,,ii #aaith ,,congress #ast ,session ,s4 #bjb ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,january #bc1 #bjbe,mrs4 ,shaheen 7for herself and ,mr4 ,cassidy7 introduced the following bill2 which was read twice and referred to the ,committee on ,small ,business and ,entrepreneurship ,a ,,bill ,to require the ,administrator of the ,small ,business ,administration to establish a program to allow small business concerns to purchase certain commodities futures1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,helping ,small ,businesses ,to ,hedge ,risk and ,insure against ,volatile ,expenses ,act or the ,helping ,small ,businesses ,,thrive ,act4 #b4 ,definitions ,in this ,act3 7#a7 ,administrator ,the term ,administrator means the ,administrator of the ,small ,business ,administration4 7#b7 ,commission2 commodity2 commodity pool2 commodity trading advisor2 future delivery2 futures commission merchant ,the terms ,commission1 commodity1 commodity pool1 commodity trading advisor1 future delivery1 and futures commission merchant have the meanings given those terms in section #a;a of the ,commodity ,exchange ,act 7#g ,u4,s4,c4 #a;a74 7#c7 ,covered commodity ,the term covered commodity means a commodity that the ,administrator1 under section #d7;b71 determines is eligible to be the subject of an agreement entered into under section #d7;a74 7#d7 ,eligible entity ,the term eligible entity-- 7,a7 means a small business concern2 and 7,b7 does not include a small business concern that-- 7i7 is1 or is owned or controlled by an entity that is1 a financial institution 7as defined in section #eji of the ,gramm-,leach-,bliley ,act 7#ae ,u4,s4,c4 #fhji772 7ii7 is1 or is owned or controlled by an entity that is1 with respect to any financial activity1 subject to the jurisdiction of the ,commission under the ,commodity ,exchange ,act 7#g ,u4,s4,c4 #a et seq472 7iii7 is1 or is owned or controlled by1 an investment adviser 7as defined in section #bjb7;a7 of the ,investment ,advisers ,act of #aidj 7#ae ,u4,s4,c4 #hj;b-#b7;a777 that is required to register with the ,securities and ,exchange ,commission under section #bjc of that ,act 7#ae ,u4,s4,c4 #hj;b-#c72 7iv7 is1 or is owned or controlled by1 a broker 7as defined in section #c7;a7 of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gh;c7a7772 7v7 has been in operation for less than #a year1 as of the date on which the small business concern submits an application under section #c7;b72 or 7vi7 the ,administrator otherwise determines should be excluded in order-- 7,i7 to preserve the integrity of the ,program2 and 7,,ii7 to ensure that the focus of the ,program remains on small business concerns desiring to participate in the ,program to maximize stability with respect to the direct operating costs of those small business concerns4 7#e7 ,program ,the term ,program means the ,helping ,small ,businesses ,thrive ,program established under section #c7;a74 7#f7 ,resource partners ,the term resource partners means-- 7,a7 small business development centers2 7,b7 women's business centers described in section #bi of the ,small ,business ,act 7#ae ,u4,s4,c4 #fef72 7,c7 chapters of the ,service ,corps of ,retired ,executives established under section #h7;b77#a77;,b7 of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcg7;b77#a77;,b772 and 7,d7 ,veteran ,business ,outreach ,centers described in section #cb of the ,small ,business ,act 7#ae ,u4,s4,c4 #feg;b74 7#g7 ,small business concern2 small business development center ,the terms small business concern and small business development center have the meanings given those terms in section #c of the ,small ,business ,act 7#ae ,u4,s4,c4 #fcb74 #c4 ,helping ,small ,businesses ,thrive ,program 7a7 ,establishment and purpose ,not later than #a year after the date of enactment of this ,act1 the ,administrator shall1 in consultation with the ,commission1 the ,secretary of the ,treasury1 and such other ,federal officials determined appropriate by the ,administrator1 establish within the ,small ,business ,administration a pilot program-- 7#a7 which shall be known as the ,helping ,small ,businesses ,thrive ,program2 and 7#b7 the purpose of which shall be to assist eligible entities in limiting the risk faced by those eligible entities with respect to rising input costs from commodities4 7b7 ,application 7#a7 ,in general ,an eligible entity seeking to participate in the ,program shall submit an application-- 7,a7 at such time1 in such manner1 and containing such information as the ,administrator determines to be necessary2 7,b7 that shall include information necessary to establish that the entity submitting the application is an eligible entity2 and 7,c7 that may include additional information to ensure that the ,administrator1 through the ,program1 is able to properly assist the eligible entity in determining whether entering into an agreement under section #d7;a7 would be beneficial for the eligible entity1 including a description of expenses incurred by the eligible entity relating to commodities4 7#b7 ,guidance ,the ,administrator shall develop guidance1 which shall be posted on a publicly available website of the ,small ,business ,administration1 to assist an eligible entity in determining whether the eligible entity should submit an application to participate in the ,program and whether entering into an agreement under section #d7;a7 would be beneficial for the eligible entity1 including information regarding-- 7,a7 the purpose of the ,program1 the products the ,program offers1 and how those products can reduce exposure to price volatility for eligible entities with respect to covered commodities2 7,b7 determining the cost of covered commodities2 7,c7 the expenses of eligible entities relating to each covered commodity1 including when expenses for covered commodities incurred by an eligible entity reach a level such that it might not be beneficial for the eligible entity to participate in the ,program2 and 7,d7 the percentages of commodity-related expenses for the eligible entity that are most likely beneficial to offset through participation in the ,program2 and 7,e7 the impact of the type of revenue of an eligible entity1 such as a cost-plus or highly variable pricing model for revenue or long-term recurring revenue4 7c7 ,outreach and consultation ,in carrying out the ,program1 the ,administrator shall conduct outreach to small business concerns1 including small business concerns that are not eligible entities by operation of section #b7d77;,b77v71 to share information regarding the ,program and the benefits of the ,program1 including by-- 7#a7 providing informational materials to the small business centers of the ,small ,business ,administration1 small business stakeholders and trade associations1 and resource partners for distribution to small business concerns2 7#b7 conducting webinars or in-person events with small business concerns regarding the ,program2 and 7#c7 operating a website and telephone line that-- 7,a7 offers additional information regarding the ,program2 and 7,b7 allows a small business concern to ask questions and obtain assistance in determining whether the small business concern would benefit from participating in the ,program4 7d7 ,administration of ,program ,in carrying out the ,program1 the following shall apply3 7#a7 ,the ,administrator may-- 7,a7 issue such rules as may be necessary2 and 7,b7 in consultation with the ,commission1 form a commodity pool and apply for registration as a commodity pool operator under the ,commodity ,exchange ,act 7#g ,u4,s4,c4 #a et seq474 7#b7 7,a7 ,the ,administrator may not take delivery of any physical commodity except in extreme and exigent circumstances4 7,b7 ,the ,administrator shall conduct such purchases and sales to close positions with respect to covered commodities as are necessary to ensure that the ,administrator remains in compliance with the prohibition under subparagraph 7,a74 7e7 ,authorization of appropriations ,there are authorized to be appropriated to the ,administrator such sums as may be necessary to establish and operate the ,program1 which shall remain available until the date that is #e years after the date of enactment of this ,act4 #d4 ,assisting small businesses transacting in commodity futures markets 7a7 ,agreements 7#a7 ,in general ,the ,administrator1 in accordance with the other provisions of this subsection1 shall enter into agreements with eligible entities that have been accepted for participation in the ,program for the purpose of assisting those eligible entities in transacting in commodity futures markets with respect to any commodity selected by the ,administrator under subsection 7b74 7#b7 ,requirements 7,a7 ,in general ,subject to subparagraphs 7,c7 and 7,d71 an eligible entity may enter into #a or more agreements under this subsection under which the eligible entity agrees to purchase a covered commodity 7or a derivative1 the price of which is related to a covered commodity7 at a price established by the ,administrator for the duration of the agreement4 7,b7 ,agreements offered ,in determining which agreements to offer to an eligible entity under this subsection1 the ,administrator shall consider-- 7i7 how closely the agreement correlates with the actual costs of the eligible entity and whether an agreement already offered under this subsection provides similar benefits2 7ii7 how to minimize complexity for the eligible entity2 7iii7 how to reduce friction in trading costs with respect to covered commodities2 and 7iv7 how to minimize the number and type of market positions of the ,program in order to reduce costs and the potential for errors4 7,c7 ,offered at cost ,an agreement under this subsection shall offer to the applicable eligible entity the covered commodity 7or derivative1 as applicable7 that is the subject of the agreement at cost1 including any fees and commissions incurred by the ,administrator in procuring the covered commodity or derivative4 7,d7 ,types of agreements 7i7 ,in general ,the ,administrator1 through the ,program1 may offer to enter into a call option purchase agreement with an eligible entity to protect the eligible entity in any case in which the price of the applicable covered commodity increases by more than #e percent4 7ii7 ,payment ,each agreement under this subsection shall clearly state that-- 7,i7 the applicable eligible entity shall be responsible for all costs associated with the agreement2 and 7,,ii7 any initial costs shall be paid at the time that the applicable eligible entity enters into the agreement4 7,e7 ,duration 7i7 ,in general ,an agreement entered into under this subsection shall be for a duration of not less than #fj days and not more than #c years4 7ii7 ,requirement ,the ,administrator shall ensure that the majority of agreements entered into under this subsection shall be for a duration of not less than #abj days4 7b7 ,covered commodities 7#a7 ,in general ,subject to paragraph 7#b71 the ,administrator shall determine which commodities shall be eligible to be the subject of agreements entered into under subsection 7a74 7#b7 ,requirements ,in carrying out paragraph 7#a71 the ,administrator-- 7,a7 shall ensure that gasoline and diesel gasoline are covered commodities2 7,b7 may offer agreements under subsection 7a7 relating to not more than #c covered commodities in addition to gasoline and diesel gasoline during the #a-year period beginning on the date on which the ,administrator establishes the ,program1 of which only #a covered commodity may be intended for specific industry use2 7,c7 may remove a commodity from being eligible to be the subject of an agreement entered into subsection 7a7 only after providing not less than #ij days notice to participants in the ,program2 and 7,d7 shall use contracts available through entities regulated by the ,commission1 such as designated contract markets1 to the maximum extent practicable4 7#c7 ,factors for consideration ,in determining additional commodities that can be the subject of agreements entered into under subsection 7a7 7beyond the commodities that are required to be included for that purpose under paragraph 7#b7 of this subsection71 or in removing a commodity that is eligible to be the subject of an agreement entered into under subsection 7a71 the ,administrator1 in consultation with the ,commission1 shall-- 7,a7 take into consideration-- 7i7 feedback from eligible entities and stakeholders1 including survey data that the ,administrator may collect1 relating to demand from eligible entities for the ,administrator to add to the list of covered commodities 7beyond the commodities that are required to be classified as covered commodities under paragraph 7#b7 of this subsection71 including whether certain commodities may see higher demand from eligible entities in specific industries1 even if demand is not as widespread across all industries2 7ii7 demand and transaction volume in particular commodities2 7iii7 available liquidity in new commodity markets2 and 7iv7 the capacity of the ,program with respect to funding and staff expertise relating to commodities2 and 7,b7 give particular consideration to classifying standard utilities1 such as electricity and natural gas1 as covered commodities4 7c7 ,commodity transactions by ,administrator ,the ,administrator-- 7#a7 shall conduct or facilitate such transactions in commodity derivatives markets as the ,administrator determines to be necessary to fulfill the obligations of the ,program under agreements entered into with eligible entities under subsection 7a72 and 7#b7 may enter into an agreement with a commodity trading advisor or futures commission merchant to carry out paragraph 7#a74 7d7 ,use of proceeds ,the ,administrator shall-- 7#a7 use any proceeds earned by the ,program in a fiscal year to offset the operating costs of the ,program for that fiscal year2 and 7#b7 return any proceeds beyond the proceeds required to carry out paragraph 7#a7 to the general fund of the ,treasury4 #e4 ,reports 7a7 ,initial report ,not later than #abj days after the date of enactment of this ,act1 the ,administrator shall submit to the ,committee on ,small ,business and ,entrepreneurship of the ,senate and the ,committee on ,small ,business of the ,house of ,representatives a report1 which shall include-- 7#a7 a description of the structure of1 and procedures for1 the ,program1 including how covered commodities are selected2 7#b7 a plan for management of the ,program2 and 7#c7 a description of the merit-based review process to be used in selecting eligible entities to participate in the ,program4 7b7 ,annual reports 7#a7 ,in general ,not later than #a year after the date of enactment of this ,act1 and annually thereafter1 the ,administrator shall submit to the ,committee on ,small ,business and ,entrepreneurship of the ,senate and the ,committee on ,small ,business of the ,house of ,representatives a report regarding the ,program1 which shall include1 for the period covered by the report-- 7,a7 the number of applications submitted by eligible entities for participation in the ,program2 7,b7 the number of agreements entered into under section #d7;a72 7,c7 the total notional value of the covered commodities that were the subjects of the agreements described in subparagraph 7,b71 which shall be disaggregated by covered commodity2 and 7,d7 the effect of the ,program on the eligible entities participating the ,program1 including feedback from those eligible entities on any costs and benefits of the ,program with respect to the business operations of those eligible entities1 in particular with respect to expansion and growth plans4 7#b7 ,limitation 7,a7 ,in general ,except as provided in subparagraph 7,b71 in collecting information from eligible entities for the purpose of carrying out paragraph 7#a77;,d71 the ,administrator may not require an eligible entity to report to the ,administrator more frequently than upon the termination of an agreement under section #d7;a7 to which the eligible entity is a party or annually1 whichever is less frequent4 7,b7 ,exception ,for the first #b fiscal years after the fiscal year in which an eligible entity enters into an agreement under section #d7;a71 the ,administrator1 for the purpose of carrying out paragraph 7#a77;,d71 may not require an eligible entity to report to the ,administrator more frequently than upon the termination of an agreement under section #d7;a7 to which the eligible entity is a party or annually1 whichever is more frequent4