WASHINGTON – U.S. Senators Bill Cassidy, M.D. (R-LA) and Jeanne Shaheen (D-NH) reintroduced the Helping Small Businesses to Hedge Risk and Insure against Volatile Expenses (Helping Small Businesses THRIVE) Act. The bill would direct the U.S. Small Business Administration (SBA) to create a new program that helps small businesses lock in the cost of commodities, like gasoline or lumber, in order to protect against the future volatile price of energy and other expenses.
“Small businesses are the first to be hurt by high inflation costs,” said Dr. Cassidy. “Let’s give small businesses in Louisiana the tools to create jobs, expand operations, and compete with large companies.”
“In the Granite State and across America, small businesses are the bread and butter of our economy – but for too many entrepreneurs, inflation and volatile expenses harm their ability to grow and maintain their businesses,” said Senator Shaheen. “Our bipartisan bill would level the playing field so that small businesses can better compete with big corporations and create good-paying jobs in our communities. I urge my colleagues to support this effort so we can keep costs under control and help small businesses thrive for generations.”
To help lower costs for small businesses, the Helping Small Businesses THRIVE Act would give them the cost-certainty, time, and confidence to build and grow their endeavors. The bipartisan legislation would direct SBA to create a program that would allow small businesses to hedge their cost exposure from commodities, like diesel or electricity. The program would offer small businesses options for how to lock in their prices going forward – with a focus on inputs that already have liquid markets and technical assistance to help businesses take full advantage of the program. Along with that guidance, SBA would conduct outreach to small businesses to ensure they are aware of the program and can benefit from it.
The program would first start to lock in costs for gasoline, diesel, and up to three additional commodities, with special attention given to standard utilities like natural gas or electricity. Additional commodities and utilities whose costs could be locked in could be added to the program after surveys and feedback from small businesses to assess which products would be most beneficial to them. Eligible small businesses would exclude traders and financial businesses to ensure this program focuses on small businesses and is not a tool for speculators.
Large businesses already protect themselves from inflation by locking in costs through hedging transactions. The Helping Small Businesses THRIVE Act gives small businesses the ability to access those same tools to protect against the volatile price of gasoline and other expenses.
A one pager on the bill is available here.
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