Cooperative Business Journal

Transcription

PARTNER with NCBA
to create business opportunities with the
cooperative market.
See our ad on page 6 for sponsorship details.
JANUARY | FEBRUARY 2011
7
11
15
New Congress
Book Review:
Co-op Cinema
Humanizing the Economy in Rural Minnesota New Opportunities
CO-OPS
& RURAL
REBIRTH
See page 8
The Kingfisher, Okla. headquarters
of Pioneer Telephone Cooperative
Photo: PTC
Your primary source for
cooperative news and information
Our View
From the ceo
Volume 25,
Number 1
The Cooperative Business Journal is published by the National
Cooperative Business Association to provide news about and for
cooperative businesses from a broad perspective. The views of
columnists and authors in the CBJ are not necessarily the policy
of the National Cooperative Business Association. Acceptance of
advertising by the CBJ does not imply endorsement of the product
or services advertised by the publisher.
Post Office Publication Number: (ISSN: 1065-7207)
Published bimonthly for Jan./Feb., March/April, May/June,
July/Aug., Sept./Oct. and Nov./Dec.,
by the National Cooperative Business Association
A portion of the annual membership investment made in NCBA
pays for the distribution of this publication. Subscription U.S.
$35 per year. All other countries $45. Periodicals postage paid at
Washington, D.C. and additional entries.
why freddie mac and fannie mae
matter to cooperatives
T
he government-sponsored
enterprises, or GSEs—the Federal
National Mortgage Association
(Fannie Mae) and the Federal Home Loan
Mortgage Corporation (Freddie Mac)—
are in the news again. And you will likely
hear a lot more about them as the new
Congress comes into session.
Since the GSEs were placed into
conservatorship in 2008, the United
States Treasury has made some $150
billion in capital contributions to support
them. The Congressional Budget Office
estimates that over a 10-year period, these
GSEs will cost the American public close to
$400 billion. Clearly, it’s time for Congress to decide the fate
of these institutions. There are a number of proposals for
what to do with the GSEs, including terminate them. One
option, in particular, has NCBA’s attention.
You may be wondering why NCBA and cooperatives
should take an interest in the debate on how to restructure
Fannie and Freddie.
One of the options for restructuring that is being
discussed with growing frequency is using the cooperative
business model. The cooperative structure has figured
in reports from the Congressional Research Service, the
Federal Reserve Bank of New York and the Government
Accountability Office. Lawmakers are becoming interested
in how the cooperative model might provide stability to
these failed GSEs. For that reason, it’s vital that NCBA follow
this issue, correct erroneous information about cooperatives
and advise Congress and others about the cooperative
business model.
NCBA’s interest is in following its mission to protect,
develop and advance cooperative business. And this issue is
fully aligned with our mission.
You may recall that last year, health care cooperatives were
highlighted as an alternative to a publicly-run healthcare
system in the United States. NCBA became part of the
debate on Capitol Hill; however, we were disappointed
with the result and its acronym. The legislation that was
signed into law, the Patient Protection and Affordable Care
Act, requires the Secretary of Health and Human Services
to establish the Consumer Operated and Oriented Plan
(CO-OP). While it contains similarity to cooperatives, the
program does not mandate use of the cooperative business
model. Further, the acronym “CO-OP” can create confusion
within the American public about just what a cooperative is!
Our government is calling something a co-op that does not
have to be a co-op. And that’s a problem for all of us.
NCBA seeks to protect the brand of cooperatives—and
that includes how the term is used by media, by the federal
government and by the private sector. The cooperative
business model is special and definite. A business doesn’t
become a cooperative just by using the name. And some use
the name inappropriately.
In the Fannie and Freddie debate, NCBA also seeks to
2
C O OPE R AT I VE BUSIN ESS JOU RNA L |
JANUARY/FEBRUARY 2011
“NCBA seeks to protect the brand of
cooperatives—and that includes how the
term is used—by media, by the Federal
government and by the private sector. The
cooperative business model is special and
definite. A business doesn’t become a
cooperative just by using the name. And
some use the name inappropriately.”
Postmasters: Send change of address to Cooperative Business
Journal, 1401 New York Avenue, N.W., Suite 1100, Washington,
D.C. 20005-2160. Address all correspondences to the Editor with
the above address or e-mail info@ncba.coop.
Call NCBA at (202) 638-6222
Printed on recycled paper using soy-based and recycled inks.
Copyright ©2011 National Cooperative Business Association.
All rights reserved. The material is this periodical may not be
reproduced, distributed, transmitted, cached, or otherwise used,
except with the prior written permission of NCBA.
National Cooperative Business Association
Paul Hazen
President & Chief Executive Officer
Andrea Cumpston
Director of Communications & Marketing
protect cooperatives by correcting erroneous information
about the cooperative business model. For example, a
report from the Government Accountability Office stated
that cooperatives moved slowly on key business decisions
because they were required to reach consensus. You and I
know better! Cooperatives are democratic institutions. As it
says in the second Principle:
Cooperatives are democratic organizations controlled
by their members, who actively participate in setting their
policies and making decisions. Men and women serving as
elected representatives are accountable to the membership.
In primary cooperatives members have equal voting rights
(one member, one vote) and co-operatives at other levels are
also organized in a democratic manner.
Finally, NCBA is committed to advancing the cooperative
business model. As Congress moves to discuss how to
restructure Fannie and Freddie, the cooperative business
model should be part of their discussions. The GAO
report stated that structuring the GSEs as cooperatives
could encourage safer and sounder mortgage underwriting
practices and promote mortgage underwriting
standardization. Further, precedents exist within the federal
government for forming government sponsored enterprises
as cooperatives. Both the Federal Home Loan Bank System
and the Farm Credit System are cooperative entities.
So, I hope that you will join NCBA in educating Congress
on this issue as the debate begins. We will be working
on Capitol Hill to advance the value that the cooperative
business model can bring, correct erroneous information
about cooperatives that appears in the media and reports
and protect the cooperative brand. Your role is to remind
your legislators that your business is a cooperative, and of
the economic and social value your business delivers to
your community. In addition, NCBA may request specific
messages as the debate progresses.
Paul Hazen
President and CEO
phazen@ncba.coop
acumpston@ncba.coop
(202) 383-5447
Andrew McLeod
Editor & Advertising Manager
amcleod@ncba.coop
(202) 383-5455
Alie Walker
Copy Editor
NCBA Staff Contacts
Adam D. Schwartz
Vice President, Public Affairs & Member Services
aschwartz@ncba.coop
John Dunn
Vice President, Cooperative Development
jdunn@ncba.coop
www.ncba.coop
The mission of the
is to develop, advance and protect
cooperative business.
The Cooperative Principles
■ Voluntary and Open Membership
■ Democratic Member Control
■ Member Economic Participation
■ Autonomy and Independence
■ Education, Training and Information
■ Cooperation among Cooperatives
■ Concern for Community
Co-opNewsHighlights
Cultivate.coop Launches
A new online resource has arrived with
support from the Cooperative Fund of
New England. Cultivate.coop now provides
educational tools for the co-op community.
Project director Brian Van Slyke describes
it as “an online hub for sharing knowledge
and resources on cooperatives, as well as
a space to practice cooperation and build
educational tools for the co-op community."
International
Highlights
See page 4!
Have an item for Co-op News Highlights?
Contact Andrew McLeod at amcleod@ncba.coop.
ing cooperatives across the nation. The law
passed includes funding for “Consumer
Owned and Oriented Plans” (CO-OP),
which allows but does not mandate the creation of cooperatives, despite the name of the
plan. NCBA is concerned about the blurring
of the definition of co-ops created by use
of the “CO-OP” name and welcomes this
opportunity to protect the cooperative brand
and ensure that entities organized under
CO-OP operate as cooperatives.
the latest addition. Converting Fannie
Mae and Freddie Mac into cooperative
enterprises offers a way to reduce the risk
to the American public while
providing an important
Dunn Named to New
source of liquidity for housing
Position – VP of
finance.
Development
“As Congress organizes for
a new year, it must face the
John Dunn will lead
issue of restructuring these
NCBA’s new domestic
entities. The cooperative
cooperative development
This new wiki-based website, which
business model should be
initiative as the vice
launched in December of 2010, encourages
part of their discussions,”
president of Cooperative
participation by anyone who thinks they
said NCBA president
Development. John
have something to share with the cooperative and CEO Paul Hazen.
has been NCBA’s vice
movement. Within two weeks of launch,
“Precedents exist—both the
president of International
its postings included over 80 articles on
Federal Home Loan Bank
Development for the
dozens of topics, a job board and tips on
System and the Farm Credit
past three years, and his
interviewing cooperators. Its developers have System are governmentleadership has helped grow
helpfully provided a video tutorial explaining sponsored enterprises that are
John Dunn
the department’s business
the site’s features and functions.
cooperatives,” he continued.
by 50 percent. He has over
The CRS
32 years experience in
Nilsestuen Fund
Report, released Nov.
cooperative development, including 29 at the
18, 2010, joins a line of
Honors Hall of Fame
U.S Department of Agriculture.
documents that include the
Inductee
Earlier this year, NCBA launched a major
cooperative business model
new domestic cooperative development
Longtime Wisconsin agriculas an option for restructuring
initiative to bring cooperative solutions to
ture, cooperative and conserFreddie Mac and Fannie Mae. large-scale needs within the United States.
vation leader Rod Nilsestuen’s
In August the Federal Reserve NCBA has a bold vision and aggressive
legacy will live on with a
Bank of New York released
plans to grow the cooperative sector of
fund established in his name.
a staff report examining the
the economy. Acting as a catalyst of
Nilsestuen died last summer
cooperative model and its
development, NCBA plans to bring partners
in a drowning accident.
advantages in addressing
together to create new co-ops and expand
incentive problems within
The Rod Nilsestuen Fund
existing ones.
the current enterprises. A
has been organized as part
NCBA will conduct an extensive search
Nov. 15 report from the
of the Ralph K. Morris
for a new Vice President of International
Government Accountability
Foundation. The fund will
Development.
Rod Nilsestuen
Office suggested that the
sponsor programming that
cooperative model could
advances research, education
CROPP Co-op Gets Nod from Dairy
encourage safer mortgage underwriting
and outreach in cooperative business and
Industry Magazine
development, wise rural land use and leader- practices and promote standards.
The CROPP cooperative, known for its
ship.
Organic Valley products, has been named the
For more information or to make a contriPaul Hazen Asked to Testify to HHS
2010 Processor of the Year by Dairy Foods
bution, visit www.ralphkmorrisfoundation.org.
on Cooperatives, Healthcare
Magazine. The publication noted the co-op’s
On Jan. 13, 2011, NCBA’s president and
solid growth to approximately $630 million
Cooperative Solution Examined for
CEO Paul Hazen will testify before the U.S.
in sales despite a challenging economic year.
Home Loan GSEs
Department of Health and Human Services.
Dairy Foods also noted the cooperative’s
NCBA is pleased to note the growing
The department is working to implement the continued work on development of new
consensus that the cooperative business
2010 healthcare legislation formerly known
products, and its positive impact protecting
model offers a market-responsive option
as the Patient Protection and Affordable
rural economies.
for restructuring Fannie Mae and Freddie
Care Act. Hazen has been invited to give
CROPP is the nation’s largest organic
Mac. A recent Congressional Research
testimony on the cooperative business
farmer cooperative and the 46th-largest
Service Report to Congress, which suggests
model.
dairy processor; it has over 1,600 members
that the government sponsored enterprises
In 2009, NCBA became involved in the
in 34 states and four Canadian provinces.
become Federal Home Loan Banks, is only
healthcare debate on Capitol Hill, represent-
HELP
CBJ
GROW.
AdvERtisE!
You may have noticed that we've got a few extra pages
this issue. We hope this is just the start of a new era of
expanded coverage, but we need more advertisements
to sustain this growth.
CBJ provides a unique way to reach the people who
care about cooperatives, and your support will help
us continue to improve and expand our coverage.
For more information,
contact Andrew McLeod at
202-383-5455 or amcleod@ncba.coop.
IYC 2012
UPDATES
Official Theme Chosen by
United Nations
The United Nations has selected
an official theme to unify global
efforts to promote the International
Year of Cooperatives. “Cooperative
enterprises build a better world” is
intended to emphasize that co-ops
are more than a social movement,
and also represent a better way of
doing business. This theme has been
prepared in all six of the U.N.’s official
languages, which may be viewed
at the ICA’s co-op year website,
www.2012.coop.
This site also features a link to ICA’s
Countdown to 2012 newsletter, which
reports that “The Year should aim to
raise public awareness of cooperatives
in their diversity, especially among
the young adult population. It is
hoped that through this increase
public recognition of cooperatives'
socioeconomic impact worldwide
that cooperatives will grow, new
cooperatives will be formed and that
policy makers will ensure enabling
policy and legislation for cooperative
formation and growth.”
Donate to the U.S. 2012
Planning Effort!
NCBA seeks donations to support
the creation of materials and
initiatives planned in celebration
of the International Year of
Cooperatives. Funds raised will
support the hiring of staff dedicated
to the IYC project, conduct
marketing activities and prepare
resource materials in order to make
the most of this historic opportunity.
Please consider donating at one of
the following four levels:
Large Organizations
$20,120 and above
Mid-sized Organizations
$2,012 and above
Small Organizations
$201.20 and above
Individuals
$20.12 and above
As a show of appreciation, each
donor will receive a set of benefits
in accord with the level of support.
NCBA is currently developing an
array of special rewards for the
various levels of support.
Please watch your mail for a
fundraising solicitation with more
details. Or, please call NCBA
Director of Communications &
Marketing Andrea Cumpston at
202-383-5447.
JANUARY/FEBRUARY 2011 |
C O OPE R AT I VE BUSINE S S JOUR NA L
3
InternationalCo-opHighlights
Cooperative Becomes Switzerland’s
Largest Retailer
Coop, a nationwide retailer in Switzerland,
has passed its only rival Migros to become the
largest Swiss retail operation. In November,
Coop announced the purchase of European
wholesaler transGourmet. Including its new
acquisition, Coop now employs nearly 75,000
people at 816 locations, with $28.1 billion in
sales; in comparison, Migros employs 83,000
workers at 608 storeslocations, and has annual
sales of $26.2 billion.
Coop and Migros combine for a 70 percent
market share of groceries, as well as about a
third of Switzerland’s overall retail activity.
The 2 million-member cooperative previously
purchased the 12 “hypermarket” stores of
European rival Carrefour in 2007 after the French
chain—among the world’s largest retailers—
abandoned its expansion into Switzerland.
More information about Coop can be
found at www.coop.ch. Indian Prime Minister Addresses ICA EXPO
The 2010 International Cooperative Alliance EXPO trade show was held in Bangalore,
India, Dec. 8-10. Here keynote speaker and former prime minister H.D. Deve Gowda
greets Shri S.K. Jakhar, chairman of the Indian Farmers Fertiliser Cooperative, a massive
secondary co-op serving 500,000 farmers. NCBA president and CEO Paul Hazen was
photo: courtesy IFFCO
among the attendees. British Co-op Youth Group Supports
Student Protesters
Woodcraft Folk, the youth organization
for the British cooperative movement,
created a web site for students to report
and connect during the wave of protests
that shook the United Kingdom in
December of 2010. The site includes
resources, updates, and connections
to social media. It is named “Kettled
Generation” after a common and
controversial police tactic of trapping
entire protests.
Founded in 1924, Woodcraft Folk
grew as an alternative to the perceived
militarism of mainstream scouting, as well
as its exclusion of girls and grownups.
The organization maintains close ties to
the co-op movement and is a member of
Co-operatives UK.
More information is available at
www.woodcraft.org.uk.
NCBA Volunteer Receives Award from USAID
Dr. Tom Anderson was honored with the Presidential Volunteer Service Award for
his participation in NCBA’s CLUSA International Program Farmer-to-Farmer program.
Anderson received the award at a ceremony held by the U.S Agency for International
Development (USAID) in Washington on Dec. 7, 2010.
Anderson visited Senegal in the summer of 2010 to support the USAID-funded Wula
Nafaa project. He used his expertise in integrated pest management to improve the
pest control methods that are offered to thousands of farmers. His advice included pest
identification, pesticide safety and use of biologically-based pesticides.
Photo: Courtesy Tom Anderson
Co-op to Co-op Program for Central America Takes Shape
By William Allmart
W
ith funding from the United
States Agency for International
Development, NCBA’s CLUSA
International Program has embarked on
an exciting initiative to create market
opportunities for producer cooperatives
in Central America by developing trade
relationships with food co-ops in the United
States.
This project—also called Co-op to
Co-op—is part of NCBA’s Cooperative
Development Program, under which NCBA
helps co-ops in other countries expand
their capacity in agricultural production,
health and food security. The five-year
work plan for Central America began in
El Salvador in November of 2010 with the
gathering of baseline data on the number,
size and financial structure of potential
co-op partners, as well as their membership
composition, product lines and current
export activities.
The first stage of data gathering used the
METRICS survey, translated into Spanish
4
by NCBA staff. This instrument, which
was developed in 2009 as part of the joint
U.S. Agency for International Development
program with the Overseas Cooperative
Development Council, is called Measuring
Cooperative Success. Its use should allow
information compiled through this initiative
to be compared with data obtained by other
development organizations.
Project staff have also begun exploring
such issues as which products might be of
greatest interest to U.S. co-ops. This includes
studying what volumes, delivery schedules
and packaging types—bulk or packaged, for
instance—could make the most logistical and
market sense, as well as which distribution
channels are most appropriate.
CDS Consulting Co-op's Cooperative
Board Leadership Development Team is
engaged in the early stages of this project,
as well. The team pilots study tours as part
of its work on capacity-building among U.S.
consumer co-op boards. CDS’s tours offer
senior co-op decision-makers first-hand
experience of the challenges facing co-ops in
developing countries and, ultimately, should
encourage U.S. cooperatives to take action
in support of sister cooperatives in other
countries.
Together with CDS, NCBA hopes to
recruit co-op officers, especially purchasing
managers, to go to El Salvador in April
of 2011 to visit cooperatives, to meet
with producers and co-op managers and
to explore in person the possibilities for
mutually beneficial business. After their
return to the U.S., NCBA will work with
these pioneering participants to configure a
detailed strategy aimed at creating realistic
business opportunities.
A key challenge for the project lies in
determining which products to offer.
NCBA plans to see whether there are new
offerings that would complement products
like coffee and cocoa, which are already
established imports into the United States
from this region. There are many co-ops
in El Salvador, for instance, but the nation’s
agricultural history has always centered on
coffee, the major crop there since colonial
times; product diversity may be a challenge.
One of the cooperatives being considered
for participation produces baked goods,
medicinal teas and cashew juice; the majority
of this co-op’s members are under the age
of 30. Another, which produces gourmet
cheese said to compare favorably with
Canadian and French products, was founded
by former child soldiers who saw the need
and found the will to make a new start for
themselves, once the dark chapter of El
Salvador’s civil war closed.
The prospects for this initiative are
exciting despite the many challenges. With
the funding from USAID, NCBA and
CDS are working to open new markets for
Central American cooperatives—and to get
their products to consumers in the United
States. For more information, and to explore
participation in the April visit to El Salvador,
co-ops are encouraged to contact NCBA.
Bill Allmart is project manager for NCBA’s
Cooperative Development Program initiative in Central America. Contact him at
wallmart@ncba.coop.
InternationalProgramNews
Better Living through Shared Services
By Jonathan Mwewa and Isaac Soko
B
ydon Musukwa, 17, is a tenth grader
at Chama Day High School. He
resides in Chama District, nearly 600
miles east of Lusaka, the capital of Zambia.
An orphan, Bydon lives alone in a village
near his school and fends for himself.
After his parents died, Bydon continually
struggled to raise school fees and provide for
basic necessities in a village where people
survive on less than one U.S. dollar a day.
With families of their own, his two brothers and sister were unable to support him
completely, and Bydon resorted to begging
to make ends meet. Without sufficient funds
for tuition, books, uniforms and the administration fee, he was no longer able to attend
school regularly.
This changed in 2008 when he met Bonnix
Chawinga, a cotton buyer and qualified spray
service provider with Birchand Cotton. The
two connected through the activities of the
Sangwani Cooperative.
Bydon, Bonnix and Their Co-op
The U.S. Agency for International
Development awarded the PROFIT
(Production, Finance, and Technology)
program to NCBA CLUSA International
Program, in order to address the gap
between the inputs and related support services that Zambian small-holder farmers
need, and what is available to them. Prior
to PROFIT, NCBA helped Zambian smallholder farmers organize into cooperatives to
enable members to benefit from economies
of scale and to access markets and services
unavailable to individual farmers.
Under the Zambia PROFIT program,
NCBA is working with total production
quality control (outgrower) companies to
provide extension and support to cotton
farmers. Services include tillage for efficient
and effective land preparation—primarily
through tractors and animal traction with
specialized “ripper” plows—ginning and
through training and equipping of professional spray service providers like Bonnix
Chawinga.
Bonnix was impressed by Bydon’s hard
work, and persuaded him to plant cotton to
finance his education. Bonnix assisted Bydon
by renting him land that Bonnix inherited
from his parents. In addition, he lent Bydon
16 pounds of cotton seeds carried over from
the previous harvest. Cotton is a significant
cash crop in Zambia, and Bydon was excited
at the opportunity to manage his own field
of cotton.
Chama District
Bydon Musukwa at school.
Photo: NCBA
Cotton farming requires intensive labor.
Bydon plows, weeds and harvests his crop
by hand. Irrigation depends solely on rain.
Because of his studies and other activities to
support himself, Bydon was unable to spend
his entire time in the field to engage in proper pest management. Lacking this specific
technical and agricultural expertise, Bydon
hired Bonnix to provide scouting and spraying services for the cotton growing season.
Economies of Scale Build Capacity
Where cooperatives already exist, the
PROFIT program encourages them to identify members like Bonnix who are qualified
to be agents, spray service providers and tillage service providers. Once identified, these
individuals are trained in both technical
information and business management, so
they may skillfully and sustainably provide
their services. In addition, the outgrower
companies provide product knowledge and
other extension information to the cooperatives, capitalizing on the economies of scale
inherent in organized groups.
The presence of the service providers presents an opportunity for members to acquire
self-employment skills, which has contributed to more cohesion in the cooperatives.
In true cooperative fashion, farmer members
aggregate their demand for products and
services. This allows them to leverage their
funds to make pre-paid orders, which are
required in Zambia due to the very real risk
of non-payment by the person receiving the
service.
The service providers benefit by growing
their businesses in the cooperative because
they tend to have better social capital with
the cooperative members, who are usually
people whom they know and relate with well.
The service providers meet with the cooperatives from time to time to give the farmers
information on how to manage their fields,
and receive feedback on the problems they
encounter.
Chama district is a
rural district located along
Zambia’s eastern border
with Malawi. Chama district
is the largest in Eastern
province, with an area of
6,800 square miles. With
a population of 69,294
according to the 2000
census, Chama district
has a population density
of 3.93 people per square
mile —about that of North
Dakota. Chama’s main
crops are maize, cotton,
peanuts, rice and sorghum.
Specialists Add Value for All
Bonnix’s spraying business has expanded as
farmers recognized the value of his services. His
client base has grown from three farmers in 2008
to 15 farmers in 2010, and his territory covers
an aggregate 25 acres. Many of his clients–like
Bydon–are members of his cooperative.
Thanks to the management services provided by Bonnix, Bydon harvested 1,056
pounds of cotton from his 1.2 acre plot,
which was collected by Birchand, which
sends trucks for farm-gate collection. He
earned $122 net after repaying his loan.
From his earnings, Bydon paid his school
fees of $70, and paid Bonnix a service fee
of $13. From the money that remained; he
was able to buy school books, uniform and
clothes. He is now able to attend school regularly and is concentrating on his studies.
Farming provides a foundation for Bydon’s
finances. He now supplements his income
from cotton through casual labor—plowing
and weeding other farmers’ fields and working on road construction and repair—and also
grows tomatoes, onions, cabbage and rapeseeds during the dry season for food and cash.
Bydon is grateful for the service he got
from his fellow cooperator, without which it
would have been almost impossible for him
to tend to his crop and attend school at the
same time. He says, “I will continue growing cotton with the help of Bonnix, to raise
money for my school fees and other things
which I need.” Jonathan Mwewa has worked with NCBA for
more than 12 years, including six years on
the PROFIT program; he specializes in monitoring and evaluation, group formation and
mobilization, agricultural, and rural development. Isaac Soko has worked with NCBA
for three years on the PROFIT program; he
specializes in agricultural development.
C O OPE R AT IVE BUSI NE S S JOUR NA L
5
My View
BY heather mcCulloch
cooperatives and the asset building movement
O
ver the course of the last two
decades, a national “assetbuilding” movement has grown
rapidly in communities across the
United States. The movement is focused
on building the financial security of
working families through a broad
range of practical strategies and public
policies that expand opportunities for
low- and moderate-income individuals
to save, invest and preserve financial
assets.
With over $3 trillion in assets under their
control, the nation’s 29,000 cooperatives play
a significant role in building financial assets
among members and owners in urban and rural
communities. But, until recently, cooperatives—
and other shared ownership strategies—have
been off of the radar screen of the national assetbuilding movement, which has been largely
focused on individual ownership.
Today, the landscape is shifting as several
national organizations have begun to
document and demonstrate how shared
ownership strategies help to build financial
assets for working families.
For example, the Democracy Collaborative
has been highlighting the wealth-building
potential of cooperatives, employee stock
ownership plans (ESOPs) and other shared
ownership strategies through its website,
"Cooperative leaders can and should be reaching out to and
educating asset-building supporters —foundations, intermediaries, advocates, legislators, financial institutions and their
regulators—about the wealth-building value of cooperatives
for underserved communities in both rural and urban areas."
community-wealth.org. They have also put
their research into action through the launch
of the Evergreen Cooperatives, a partnership
with the Cleveland Foundation.
The Annie E. Casey Foundation has
worked to build bridges between the assetbuilding and shared ownership movements
for the past two years with a framing
paper and national meeting, followed
by support for national working groups,
public education and workshops to identify
common goals and priorities.
More recently, two prominent national
asset-building intermediaries—CFED and the
New America Foundation—each took steps
via webinars, blog postings and awards to
shine a light on the value of shared ownership
strategies as an alternative approach to building
financial assets for lower-income households.
It is time to build upon this momentum to
REACH
THE COOPERATIVE MARKET
Partner with NCBA to create business
opportunities with the cooperative market.
In 2011 we’re offering three packages to meet
your sponsorship and advertising needs.
Twin Pines Partner
$25,000
Honored Cooperator
$15,000 (Best Value)
Cooperative Supporter
$10,000
All of our sponsorship packages include an integrated approach to
spreading your message. We offer online advertising, conference
sponsorship and print advertising. If a package is more
than you’re looking for, take a look at our a la carte options.
Visit www.ncba.coop and click on the Reach our
Cooperative Market spotlight to see the full sponsorship packet.
Contact Carissa Heckathorn at checkathorn@ncba.coop or
202-383-5471 for more information.
6
expand the base of support for cooperatives
as an asset-building strategy. Cooperative
leaders can and should be reaching out to
and educating asset-building supporters
—foundations, intermediaries, advocates,
legislators, financial institutions and their
regulators—about the wealth-building value
of cooperatives for underserved communities
in both rural and urban areas.
Income Is Not Enough
Often, conversations about poverty
focus on income, which can be increased
in ways that bring short-term benefits
without changing families’ long-term
economic security. Fortunately, there has
been a growing national dialogue about the
importance of financial assets —cash savings,
stocks, bonds; home, business and real estate
equity—in building the financial security of
low- and moderate-income working families.
While income is critical to enabling
families to get by day-to-day, assets enable
them to weather financial crises, invest in
their children and their communities, plan
for a secure retirement and pass resources on
to future generations.
Even before the recent recession, U.S.
families were experiencing unprecedented
levels of financial insecurity. Nearly one in
four households was “asset poor” meaning
they had insufficient assets to survive—even
at the poverty level—for more than three
months if they experienced a job loss or
other income disruption. The economic
crisis has only made matters worse as it has
pushed millions of middle-class families into
income and asset poverty.
Cooperatives and Asset Building
Typically, asset-building strategies create
opportunities—through programs, services or
public policy—for low-income individuals or
families to build financial assets through access
to financial education and services; matched
savings opportunities; opportunities to invest in
a home or business; or asset protection services
like health insurances, alternatives to payday
lending or foreclosure prevention.
While cooperatives are not typically
included on the menu of asset-building
strategies promoted by national advocates,
funders and intermediaries, they should
be. Cooperatives help to build the financial
security of community residents by
increasing the profitability of local, familyowned businesses; lowering the costs of
goods and services to residents; or enabling
local residents to gain an equity stake in the
businesses where they work. In addition,
some cooperatives—especially credit unions
—provide other asset-building services
National Asset-Building
Resources
Asset Funders Network
www.assetfunders.org
Center for Social Development at
Washington University in St. Louis
http://csd.wustl.edu
CFED
(www.cfed.org)
Cities for Financial Empowerment
http://www.cfecoalition.org
Democracy Collaborative/
Community Wealth Building Program
www.community-wealth.org
Institute on Assets and Social
Policy at Brandeis University
www.iasp.brandeis.edu
New America Foundation/
Asset Building Program
www.assetbuilding.org
Yellow Wood Associates/
Ford Foundation–Wealth Creation
in Rural Communities
http://www.yellowwood.org/
wealthcreation.aspx
such as connecting members to financial
education or homeownership counseling, or
helping them to access low-cost credit and
other affordable, low-risk financial services.
Nonetheless, cooperatives rarely see
themselves as part of the national assetbuilding movement; and most movement
leaders are not aware of the asset-building
value of cooperatives.
So Where Do We Go from Here?
One way for cooperatives to start making the
connection to the asset-building movement is
by participating in state and local asset-policy
coalitions. These coalitions are now operating
in over 40 states, advancing a broad range of
policies and practices that support working
families’ efforts to build financial assets. They
offer opportunities for cooperative leaders
to engage with, learn from and educate new
partners in a way that leverages financial and
other resources. In addition, community
leaders can reach out to national asset-building
intermediaries for information on strategy
development and implementation, tools and
technical assistance.
Cooperative development may not be a
new idea, but it is a powerful wealth-building
strategy that deserves the attention of the assetbuilding field. Now is an opportune time for
cooperative leaders to join the asset-building
dialogue and make their voices heard. Heather McCulloch is the founder of
Asset Building Strategies, a consulting
firm that advances policies and strategies
to support low-wealth families to build
financial assets, as well as a consultant
with the Annie E. Casey Foundation. For more
information, visit www.assetbuildingstrategies.
com for more information. This article was
adapted from a piece published in Rural
Cooperatives magazine.
Humanizing the Economy: Co-operatives in the Age
of Capital, by John Restakis
Book Review by David Thompson
I
t is not often that a co-op classic comes
along, but one has just arrived.
Humanizing the Economy:
Co-operatives in the Age of Capital, by
Canadian co-op organizer John Restakis,
is an epic contribution to the literature on
cooperatives. Restakis’ writings about the
philosophical underpinnings of cooperatives
explore the vibrant economic thinkers of
the 17th through 20th centuries. He weaves
the macro-economic perspectives of the
era into the practical everyday efforts of
the Rochdale Pioneers, who launched the
modern cooperative movement in England
and created the origins of what we now call
the “social economy.” This book is a new
mini-Bible for cooperators. If you have the
“cooperative religion,” you need this book!
I purposefully concluded my review on
December 21—the anniversary of the first
cooperative store’s 1844 opening in Rochdale
—in honor of this book.
After showing these philosophical origins,
Restakis then persuasively shows us where
some cooperatives are going. The book’s
second part starts with the outstanding
achievements of the cooperative sector in the
Italian region of Emilia Romagna, an area in
which the author has great expertise.
Restakis is co-founder and coordinator
of the Bologna Summer Program for
Cooperative Studies at the University of
Bologna, offered by the British Columbia
Cooperative Association. His numerous
annual visits to Emilia Romagna place him in
the position of being the most knowledgeable
English-speaking resource about the
successful cooperative infrastructure of
the region. He shares with the reader his
immense on-the-ground knowledge through
valuable examples.
The impactful role of “reciprocity” among
cooperatives comes to life through Restakis’
pen. Anyone who wants a more human
economy that works for all will have much to
learn from the chapters on Emilia Romagna.
Restakis’ journey in the book looks also
at the leading role of cooperatives in the
worker takeovers following Argentina’s
2001 economic collapse, the Sri Lankan
tea industry, the social economy of Japan
and the bettering the life of prostitutes
in India. Every story is inspiring proof
of the practicality of cooperatives, and
Restakis points out a critical fact when
measuring economic models – worldwide,
cooperatives employ more people than all the
multinational companies.
Some might wonder why Mondragon gets
only a small mention in the book. When
asked about this, Restakis noted that there
is an excellent body of literature already on
Mondragon. He felt that his book would
elevate discussion of the Emilia Romagna
model and other models as additional centers
of cooperative success. Having studied the
Emilia Romagna model since the 1970s, I
am glad that this book has shone light on the
cooperative sector of the region.
Restakis has a lucid writing style, which
reflects the need to link regular members to
the philosophy of a movement. This is rooted
Don’t be afraid
to pick the right brand
for your co-op.
Humanizing the Economy: Co-operatives
in the Age of Capital is available for
$19.95 through New Society Publishers:
www.newsociety.com.
in his decades of everyday cooperative
organizing in Canada.
For those who believe in cooperatives but
have wondered how to explain why do we do
them, this book will answer those questions.
One of the strengths of Restakis’ research is
his focus on what he calls the “socialization
of capital.” This is a great eye-opener
about the importance and role of capital in
cooperatives.
Restakis shows us the strength of
cooperatives as a thriving economic
model rather than an ancient aberrant
exercise. His research into the schools of
economic thinking about cooperatives is
the most comprehensive since Professor
Lambert’s Studies in the Social Philosophy of
Co-operation. Regretfully, the cooperative
community has had to wait a half-century for
this new co-op classic by John Restakis. Yet,
the wait was worth it.
If you wonder about how you can help
build a world of cooperatives, then John
Restakis has written an excellent guide book
with interactive maps to many cooperative
successes. In preparation for 2012 the UN
Year of Cooperatives, every cooperator
should get a copy! David Thompson is president of the Twin
Pines Cooperative Foundation and a 2010
inductee into the Cooperative Hall of Fame.
What will help co-operative and credit
union managers create
a hopeful tomorrow together?
According to Sean Doyle,
the Master of Management Co-operatives and Credit Unions
delivers a business strategy and a
way of organizing the economy.
An international program with
students, faculty and curriculum
from around the world.
A distance-learning program
designed to allow you to study,
work and change your world.
“What this program really serves is taking the intellectual basis from
which co-ops came 160 years ago and carrying it forward to a new
generation of leaders, and that’s not just a business strategy but also
a way of organizing an economy. This program is very important. It
has tremendous potential. My hat’s off to the people who created it.
The world’s a better place because of it.”
Sean Doyle,
General Manager, Seward Cooperative,
Minneapolis, Minnesota
Tom Webb, Program Manager
Larry Haiven, Program Co-ordinator
Master of Management – Co-operatives and Credit Unions
Department of Management, Saint Mary’s University
Robie Street, Halifax, Nova Scotia, Canada B3H 3C3
®
Click on the .coop logo at www.ncba.coop or
call 202-383-5442 for more information.
Application deadline May 31 for
Fall. Orientation early August.
Information and Student Profiles:
www.mmccu.coop
Tom.webb@smu.ca
902 496 8170 or 902 634 4536
larry.haiven@smu.ca 902 420 5082
7
National Information Solutions Cooperative’s building in Lake St. Louis, Mo. was built in 2005; it is one of three operational centers for this growing co-op. Photo: courtesy NISC
Co-ops thrive
in the Heartland
By Nancy Jorgensen
The real estate and financial crises spurring
the recession hit hard on the nation’s coastlines
and the Southwest, where speculative
investment was concentrated. Heartland
businesses from the Dakotas to Oklahoma and
Missouri aren’t immune to this national crisis,
but we found five co-ops in the technology,
energy and telecom industries that continue to
thrive. Their success can be explained not only
by their location, but also by new technologies,
the region’s work ethic, and the co-op way of
doing business.
O
n a sunny summer
morning, Vern Dosch
likes to hop into his
kayak near his home
north of Bismarck, N.D.,
and paddle across the
Missouri River to work in Mandan. Then he
straddles a bike that he’s positioned on shore
and pedals a few miles uphill to National
Information Solutions Cooperative, where
he serves as president and CEO. This time of
8
year he straps on his snowshoes, but it’s still
not a bad commute.
This illustrates one reason that Dosch
likes living in the Heartland—the chance to
play in the great outdoors. There’s also his
rewarding job over the past few decades,
leading this growing information technology
co-op with sales poised to top $125 million
in 2010. NISC’s 830 employees work in
Mandan as well as Lake St. Louis, Mo., and
Shawano, Wis.
“This business is all about economies of
scale,” Dosch says, explaining the co-op’s
growth. “It would be extremely difficult and
certainly not cost effective for the 560 small
electric and telecommunications co-ops and
companies that we serve to hire programmers
and build their own software. We develop it
once, and install it many times.”
Author Joel Kotkin noted how Heartland
businesses like NISC have escaped the
worst of the recession in his book, The
Next Hundred Million—America in 2050.
“Although rural states and communities have
been hit by the recession that began in 2007,
on average they maintained their job levels
more than the more populated areas and
suffered far lower unemployment,” Kotkin
wrote. He predicts that a significant number
of Americans in the coming decades will
make a home in the Heartland as the U.S.
population grows by 100 million people.
Kotkin’s book didn’t focus exclusively on
co-ops, but he cites Vern Dosch in his book’s
Heartland chapter as one of many Dakotans
enjoying a good quality of life. “We now
can work in a challenging industry but live
in a place we want to live,” Dosch says in
the book. “We can send our kids to a public
school where 98 percent of the kids graduate
and 95 percent go to college. You don’t worry
about crime, and a long commute just isn’t in
the vocabulary.”
New Tech Propel Co-ops Forward
Like NISC, four other Heartland co-ops
have capitalized on new technologies in the
high-tech, telecom and energy industries.
In Williston, N.D., new horizontal drilling
techniques are fueling an oil and natural
gas boom. Mountrail-Williams Electric
Cooperative has stepped up, delivering
electricity to the new wells to power drills
and pumps. “Over the last six years, we’ve
averaged 15 percent growth a year,” reports
Mark Holter, manager of member services.
Growth isn’t quite that strong at Sioux
Valley Energy in Colman, S.D. But Carrie
Law, director of communications and
government relations, feels pretty good
about a steady growth in electric use of 5 to
7 percent at her co-op over the last several
years. Here, a different kind of energy boom
—ethanol—hit a few years ago. “We have
abundant corn resources, and ethanol and its
by-products have been a major player in the
vitality of the region,” she says. Her co-op has
successfully expanded into wireless service.
Energy ups and downs also impact
Kingfisher, Okla. Local exploration slowed
after the 1980s, but oil and gas companies
continue to operate from the area, providing
growth opportunities for Pioneer Telephone
Cooperative. But Richard Ruhl, Pioneer’s
general manager, credits most of his co-op’s
growth to new wireless, TV and Internet
technology that enabled the co-op to
Mark Holter stands by the meter for one of many new oil rigs served by the MountrailWilliams Electric Cooperative. Photo: courtesy MWEC
Sioux Valley Energy Cooperative’s line crews work year-round to expand and maintain the
co-op’s distribution system.
Photo: by Carrie Law
diversify. “Our consolidated revenues grew
38 percent from 2005 to 2009, when they
reached $165 million,” Ruhl says.
Rock Port Telephone expanded into
wireless, TV and Internet over the last 20
years. But for this Missouri co-op, it was a
data subsidiary that spurred growth despite
a decrease in the number of local residents.
Today Midwest Data Center employs
35 people, compared to 10 at the parent
company. “The local population dropped
by 25 percent in the last two decades,”
says Raymond Henagan, CEO and general
manager. “Midwest Data Center allows us to
serve customers all over the U.S.”
All of these co-ops embraced new
technologies that contributed to their success.
But they were also in the right place at the
right time. While energy, high-tech and
telecommunications industries are booming
around the world, the Heartland has especially
benefited from upward trends in agriculture.
Earnings for those who raise crops are
projected to rise even higher at least in the
short term, spurred by high demand as corn
continues to move into the ethanol pipeline
and as ag exports lead the way in brightening
the U.S. balance of trade. Corn supplies are
tight, prompting a price jump beginning in
June, and recent spikes in farmland prices in
places like Iowa have experts worrying about a
farmland price bubble. Beyond a strong ag-based economy, the
Heartland enjoys one more advantage. Our
five co-ops also credit their prosperity to the
famous Heartland work ethic. members can each purchase a different level
of service, ranging from simple billing to a
full suite of technology solutions.
NISC is months away from placing all
560 of its members on the same network
for the first time—Java programming script
with an Oracle database. Besides being more
efficient, this huge undertaking helps NISC
attract and retain the best IT employees,
most of whom want to work with this
prevalent technology.
Six years ago, NISC partnered with
challenge is helping electric co-ops move
toward the smart grid, where new technology
allows for greater energy efficiency.
Exciting projects like this help NISC retain
employees at a time when Google offers
bonuses to keep staff from bolting for greener
pastures. “In the tech industry, it’s not unusual
to see a 25 percent turnover rate,” Dosch
says. “Ours is just 3 percent a year.” NISC
researches competitors’ salaries, figures in the
cost of living—often lower in the Heartland
—and compensates its crew accordingly. But
Mike Goins (left), CTO of Rock Port Telephone,
helps technician Rafael Saucedo troublePhoto: courtesy RPT
shoot a client server.
Richard Ruhl (right), general manager, interacts with a customer at one of 25 Pioneer
Telephone Retail Centers. Photo: courtesy PTCI
Touchstone Energy, a marketing coopertive
owned by rural electric co-ops throughout
the nation. As a result, this year NISC will
manage $4 billion in utility bills for companies
like Walmart, Target and JCPenney. NISC
helps them pay bills, analyze use, save costs
and reduce carbon footprints. NISC’s next
Dosch also credits the Heartland lifestyle with
keeping employees happy.
When it comes to attracting talent, “We
grow our own,” Dosch explains. “We hire
people from the Midwest with aptitude
and train them.” NISC built a Java training
Cutting-Edge Economies of Scale
Back in North Dakota, National
Information Solutions Cooperative got its
start 45 years ago by printing invoices for
three electric and telephone co-ops. Today,
NISC employees work around the clock
to print 11 million bills each month. In
addition, the crew provides complete IT
packages, from networks to software. NISC's
Kotkin Hails the Heartland
The United States stands poised to
grow to 400 million people by 2050, and
Joel Kotkin believes a good share of the
growth will come to the Heartland.
“One of the least-anticipated
developments in the nation’s 21st-century
geography will be the resurgence of the
American Heartland, often dismissed by
coastal dwellers as ‘flyover country,’”
Kotkin says in his book, The Next
Hundred Million: America in
2050.
Kotkin cites the resurgence
of towns like Bismarck,
Omaha and Des Moines as
evidence. His book spells
out attributes that help rural
communities attract jobs:
The cost of housing in
rural areas runs lower than in
major cities. Businesses can
pay employees less because
people can live better on a
lower salary.
Good schools and colleges
attract jobs by providing
a source of new talent,
especially colleges that work
with employers to customize
training for their industries.
The Heartland views
industry positively, and its
facility in its Mandan headquarters and
invited a nearby university to use it for
classes. “This gives us access to the pick of
the litter.”
Boom Times for Hard Workers
Thanks to hard-working employees and
new technology such as that seen at NISC,
along with the oil boom and positive trends
in agriculture, North Dakota boasts the
lowest unemployment rates in the nation
—3.8 percent in November, compared to a
national average of 9.8 percent.
North Dakota’s job picture hasn’t always
been rosy. Mark Holter grew up in Williston,
but left to find a job. When he returned—he’s
been at Mountrail-Williams Electric for 31
years now—he welcomed the slower pace,
and the chance to hunt pheasant and fish for
walleye. But lately, with the influx of oil and
gas workers, traffic’s picking up.
“It’s almost impossible to find a place
to live,” Holter reports. At one point this
fall, MWEC was trying to fill 11 positions.
It has been able to hire all line workers
needed from a school in nearby Bismarck,
but recently recruited a dispatcher from
Kentucky. The co-op brings in trailers to
house recruits, while oil companies put up
“man camps,” stacking portable trailers four
stories high.
The history of oil drilling is checkered
with ups and downs. MWEC survived a
boom and bust in the 1980s, and learned
then to keep employee numbers down. Today
MWEC’s 60 employees focus on serving
the co-op’s 4,500 business and residential
members. Its membership in NISC has
helped with this growth in operations.
The co-op also turns to contractor crews to
deliver new electric lines and substations to
the oil field. “We’ve got 200 people working
for four to five companies on contract, and
CO-OPS IN THE HEARTLAND
continues on page 10
workers share a good work ethic.
Employees can work from anywhere
with high-speed Internet.
Kotkin doesn’t paint a bright picture
for the smallest towns, which may lose
population to regional trade centers. But
overall, the impact of America’s growth
on costs and congestion in big cities will
drive more people to the Heartland.
For more information, see Kotkin’s
website, www.joelkotkin.com.
9
CO-OPS IN THE HEARTLAND from page 9
we’re still 300 wells behind,” Holter says.
The co-op’s contractors work long hours,
barely slowing down during the fierce winters.
In three years peak demand has risen to 90
megawatts from 30. So Basin Electric Power
Cooperative, a large regional generation and
transmission co-op owned by local electric
co-ops, is beefing up plants and transmission
lines to make sure power is available.
“We’ve got five co-ops in the thick of
this boom,” says Dennis Hill, executive
vice president and general manager of
North Dakota Association of Rural Electric
Cooperatives. “But our co-ops offer good
jobs, and we have a reputation as a stable
employer. We don’t have the ups and downs
faced by other types of businesses.”
Pioneer Workers Plow New Ground
Just as you need electricity to power the
energy boom, you need the Internet and
other technology to bring jobs to rural areas.
Telecommunications co-ops like Pioneer
Telephone are delivering.
Newsweek recently hailed Oklahoma
City—with job growth of almost 5 percent—
as one of the 10 places you can go in the U.S.
to escape the recession. Workers here share
the Heartland work ethic, but hiring can be
a challenge at nearby Pioneer Telephone.
Local kids don’t always have the high levels
of education that you find in the Dakotas. So
Pioneer works with community colleges and
technical schools to fill its hiring needs. One
school tailored a six-month training program
just for Pioneer.
When it comes to retaining its 550
employees, part of the allure is working
with the latest technology. Pioneer was one
of the first telephone companies in the U.S.
to deliver TV over its copper phone wire,
pumping up signals with fiber and Internet
protocol.
This co-op’s diversification into new
technologies couldn’t come at a better
time. Pioneer’s traditional business with
landline telephone customers is on the
decline, reflecting a worldwide trend toward
wireless phones. Today the co-op bills
150,000 consolidated subscribers a month,
but less than half of the bills go to landline
subscribers. Most go to the co-op’s wireless,
Internet, and Internet protocol digital TV
customers—technologies that the co-op
began embracing two decades ago.
Until now, Pioneer separated employees
into telephone, wireless, TV and Internet
skill sets. “We recently reorganized to
eliminate the silos that separate our
business lines,” Ruhl says. “We’re moving
from a telephone mentality to a one-stop
communications shop. It’s a huge culture
shift for employees, but it will improve
customer service.”
Data Subsidiary Outgrows Parent
It takes four hours to drive the swath
that Pioneer’s service territory cuts across
Oklahoma and Kansas. By comparison, Rock
Port Telephone Co. in Rock Port, Mo., fills
a smaller footprint with just 1,500 members
in a territory 19 miles across. The parent
company may be small, but its subsidiary,
Midwest Data, has attracted a clientele that
includes small trucking companies operating
along nearby Interstate 29, as well as a large
bank and a multinational engineering firm.
Rock Port started Midwest Data seven
years ago when a customer needed a larger
server for his IT business. The concept
of providing IT services intrigued CEO
CELEBRATING
35 YEARS GROWING COOPS!
As members of the cooperative community, you know the
benefits of cooperation. Coops put people before profits,
contributing to a more participatory and sustainable economy.
Since 1975, the Cooperative Fund of New England has
helped coops grow, providing more than $22 million in loans
to over 500 coops and community organizations across our
region.
But we do not do this work alone. We rely on our donors
and investors — people like you — to help our coops thrive.
For more information on how you can get involved, please
contact us.
Raymond Henagan, and he brought the idea
to his board. A few months later, Rock Port
hired the customer as the first employee of
the co-op’s new data business.
Mike Goins, chief technical officer at
Midwest Data, became the second employee
after responding to a ad on the internet.
Working in Kansas City at the time, he was
seeking a slower pace.
Later, Midwest Data found a more
homespun way to recruit workers. A job
shortage pushed local kids to move to urban
areas, but after a taste of city life, some
wanted to move back home. “We advertised
openings in local papers, and mothers and
grandmothers sent the ads to their kids and
grandkids,” Henagan says.
Midwest Data is riding a new wave that
Kotkin calls insourcing. “Lower costs have
often been cited as the primary reason for
moving jobs offshore,” Kotkin wrote, “but
relocation to the Heartland brings many of
the same benefits.”
Henagan points out another plus. “Our
customers like being able to speak to someone
they can understand, who knows them and
meets their business needs quickly.”
Now the co-op works with local colleges
to fill openings. “Our churn rates are
dramatically less than like companies in
metro areas,” Goins says. “We take the time
to hire people who make a commitment to
the community.” Goins serves on the Rock
Port City Council, and other employees are
involved with the fire department, Rotary
Club and youth hunting program.
Co-op Meets Wireless Demand
Telephone systems aren’t the only co-ops
that offer high-tech services. Sioux Valley
Energy is one of a number of electric co-ops
marketing wireless Internet through a
subsidiary.
“There’s definitely competition,” Law
says. “However, we offer wireless at a low
price, and we don’t require phone lines
or contracts, and that’s helped us build
the Sioux Valley Wireless customer base.”
The electric co-op serves 20,000 members
compared to 3,000 at the wireless company,
but wireless demand is growing fast.
Together, the companies employ 105 people.
While high-tech services like wireless
Internet spur economic development,
Law stresses the importance of electricity.
“Electric cooperatives in this region benefit
from relatively low power supply costs
compared to national averages,” she says.
“We offer an attractive development and
growth area for potential businesses.” In
fact, Sioux Valley Energy and other area
electric co-ops finance business development
through a nonprofit fund, Rural Electric
Economic Development.
Sioux Valley Energy receives benefits from
being a member of NISC, and also recently
received a grant from the U.S. Department
of Energy to develop its smart grid, which
promises to improve efficiencies and hold
down costs even more.
Co-op Structure Is No Hindrance
A revolving loan fund and socially responsible investment option.
To learn more, call 1-800-818-7833 or visit www.coopfund.coop.
10
C O OPE R AT I VE BU SIN ESS JOU RNA L |
No matter where your co-op operates,
you’ve probably heard critics worry that
co-op structure slows down innovation and
responsiveness. After all, co-op members
elect fellow members to serve on a board of
directors—it’s a bottom-up form of governance.
But at Mountrail-Williams Electric, when
the board got wind of the coming oil boom,
“Our directors jumped in with both feet,”
Holter says. “Some co-ops took a slower
approach, and required oil companies to
use generators. But we talked to oil and
gas companies and learned that this time,
For More Information…
Mountrail-Williams
Electric Cooperative
Williston, N.D.
mwec.com
National Information
Solutions Cooperative
Mandan, N.D.
nisc.coop
Pioneer Telephone
Cooperative Inc.
Kingfisher, Okla.
ptci.com
Rock Port Telephone
Rock Port, Mo.
rpt.coop
Sioux Valley Energy Cooperative
Colman, S.D.
siouxvalleyenergy.com
they’ll be around for a long time.” The co-op
borrowed $60 million to meet growth needs,
and assets have since grown to $120 million.
“Some co-ops are skeptical of making this
type of investment, but it’s paying off for us.”
Ruhl’s grandfather helped form both
Pioneer and the local electric co-op, and
Ruhl believes that the co-op structure helps
Pioneer live up to its name. “We’re fortunate
to have a visionary board,” he says. Keeping
the board up-to-date can be a challenge in
the fast-paced communications industry.
Ruhl brings in experts to explain trends
during board retreats, and it seems to be
working. The board recently embraced thirdgeneration wireless technology, which allows
for more data transmission—a $10 to $15
million commitment.
Ten years ago, Henagan urged the Rock
Port Telephone board to sell and repair
computers, a sideline that now generates
$1 million annually. “Our board envisions
transforming our telephone co-op into a
technology company,” he says. “Our future is
in data.”
And Goins believes that co-op values
make his company a great place to work, and
a great place for customers. “We take the
service focus of the co-op and translate it to
an IT business,” he says. “Most IT companies
sell whatever’s hot. We only sell what’s
best for our customer’s bottom line. That’s
completely foreign to most IT businesses.”
Many co-op CEOs serve on the NISC
board. “Our board gives us a lot of rope, and
we’ve never hung ourselves,” Dosch says.
He shares Goins’ belief that the co-op way
of doing business positions NISC to offer
what people want today. For example, in
2002 Dosch asked employees to draft a set
of values that the board later adopted. They
include statements like, “We are committed
to doing the right thing, always.”
In the Heartland, co-op values resonate
with workers. As Dosch says, “Today, the
best and the brightest employees want
to go home feeling that they can trust
management. That’s the key, not just dollars.”
Based on the success of NISC and at other
Heartland co-ops, the co-op way of doing
business also resonates with customers and
owners. Not every business, and not every co-op,
can thrive in today’s economy. But these
Heartland co-ops have each built a winning
formula that includes embracing new
technology, cultivating a good work ethic
among employees, and capitalizing on the
co-op way of doing business. As Mike Goins
says, “We’ve had our best years ever during
the recession.” Cinema Brings Life to Minnesota Town
By Craig Otterness
I
t’s not every day a small town gets a
new movie theater on Main Street, but
that’s exactly what our co-op has done.
Spring Grove Communications co-op
built a cinema during a two-year, fiberoptic installation project. The fiber-optic
cable is all in the ground, and all of our
customers in our 100-square-mile rural
service area have fiber to each of their
homes and businesses. This is technology
that most large metro areas do not have,
and it should take care of our community
technology needs for years to come.
But we wouldn’t leave it at that. The
co-op is a strong supporter of our
community, and building a cinema is only
the latest project it has completed for our
“happening” town of 1,400, tucked away in
the southeastern corner of Minnesota. The
old cinema, at a different locale, had closed
a number of years ago, forcing residents
of Spring Grove to travel thirty miles for a
night at the movies.
Building Boom
The cinema is not our first major
downtown construction project.
Monday movie schedule, there have
been training seminars with a large
medical clinic, a meeting of the Southeast
Minnesota Economic Development
Authority and even a couple of video
gaming contests. A local church has held
services, shown Christian movies, and
then discussed them afterwards. Other
events have included a wedding, bluegrass
musicians, private showings of the current
movie, parties for elementary sports teams
and birthday parties.
Other activities include a partnership
with our local library, which writes grants
for different activities. One of the grants
was used to bring in performers featured
on A Prairie Home Companion. We rented
a baby grand piano for the show, and the
public library later decided to purchase
it. Now the piano sits on the stage of the
cinema, and recently, local piano students
used it for a Christmas carol sing-a-long.
We have presented a variety of
performers, including internationallyknown Norwegian artist Sigmund Aarseth,
who painted three large paintings on the
cinema stage to musical accompaniment.
Afterward the pictures were auctioned off
to benefit a new genealogy center next
door to the cinema.
Our cooperative is our community.
Our community is our cooperative.
When we help one, we help the other.
In 2004, we purchased blighted property
next to our office and built a new $1.2
million headquarters. This price may
sound excessive, until you understand
what is inside that building—a new public
library, two community meeting rooms
and three separate business offices that
currently house a graphic designer, an
attorney and an Internet business. The
co-op also owns and operates a 24-hour
fitness center with a trainer. And the
building offers more space for our co-op
to grow.
Spring Grove Communications has also
contributed $100,000 to help fund a new
aquatic center for the city, replacing an old
and inefficient pool. This facility draws
many kids and families from out of town,
boosting the local economy.
For the cinema, we spent $1.1 million
and built—from the ground up—a
stadium-style, 200-seat, full digital,
3D-capable facility with a stage for
presentations, public meetings and other
forums, as well as 900 square feet of rental
office space.
The cinema has been a huge hit and
keeps Main Street full of cars and activity.
More than Movies
The cinema opened in 2009 and has
always been more than a movie theater.
The first event there—even before showing
a movie—was a play by the local drama
organization. The space has quickly
become a vibrant center for all kinds of
community events. It even sells locallyproduced Spring Grove Soda Pop, which
has been in business for 115 years.
In addition to the Friday through
Learning by Doing
Currently the cinema has thirteen
employees, nine of whom are local youth.
We are forging a partnership with the
local K–12 public school, highlighting
the learning experiences for students
and showcasing potential careers in the
movie business. Possible projects include
developing advertising to sell to area
businesses or making short films about
area businesses.
Our cinema manager develops, designs,
sells and plays all the local ads during the
period before the previews. When she’s
not working on cinema jobs, she is in
charge of Spring Grove Communications’
own SGC-TV local channel, which we are
about to launch. Community programming
such as City Council or School Board
meetings, school activities like band and
choir concerts, student-made videos and
advertising plus many more communityminded events will be shown on the
“local channel.” And of course, anything
produced for the cinema could be played
on our local TV channel as well.
It has been a lot of hard work and
planning, but the rewards for the
community cannot be measured. Our
cooperative is our community. Our
community is our cooperative. When we
help one, we help the other. Craig Otterness is the general manager
and CEO of Spring Grove Communications.
This article was adapted from a story that
appeared in the NTCA Exchange newsletter.
For more information about the cinema
visit www.sgmovietheater.com.
The state-of-the-art Spring Grove Cinema brings first-run movies to a town of only 1,400
residents. Photo: courtesy Spring Grove Communications
Flexible & AFFordAble
boArd TrAining
Give your board the training they need—when they want
it. Purchase and download NCBA’s online board training
today to increase the success of your board. They can watch
the training as a group, individually, at work or at home.
Just $359 each for NCBA members or $399 each for
non-members. Once you purchase the module it’s
yours to use for as often as you
need with no additional cost.
Visit www.ncba.coop/education-and-training
to get started, or contact Carissa Heckathorn at
checkathorn@ncba.coop or 202-383-5471 for more info.
11
Five Strategies for a Peak-Performing Board
Your directors contribute–good or bad–to your co-op’s legacy
By Mark Condon
I
own the dubious honor of once
stopping a credit union board dead in
its tracks. An article I penned on the
responsibilities and liabilities of credit union
boards—although mild in tone and vetted by
attorneys—had panicked the directors.
I received a frantic call from the CEO,
claiming his board refused to take any action
during its most recent board meeting. While
I knew the CEO was exaggerating, I still
provided him with a letter of clarification
that he could share with his board to move
them off the dime.
A democratically-elected board of
volunteers is one of a cooperative’s greatest
strengths. It’s also one of its greatest
vulnerabilities. As the challenge to craft
policy in a complex and sophisticated
financial world becomes more difficult, a
weak board can be devastating.
Amazingly, there are still some CEOs who
prefer to keep their boards selectively in the
dark. They worry about directors who are
simply meddlesome by nature, misinformed,
or poorly-trained. No matter the reasons, it’s
the wrong approach.
Yvonne Evers is a credit union consultant
who has guided credit unions on leadership
and governance issues for years. In her
recent book, “Peak Credit Union Board
Performance,” she explains that every good
CEO needs a board that’s performing at its
peak. Like any consultant worth her salt,
she provides her advice entertainingly and
outlines five core strategic principles that
boards should strive to implement:
1. Accept
nothing less
than trust and respect.
2. Take
a proactive approach
to board member succession.
3. Ensure
the CEO compensation
package shows value.
4. Plan
for the right leader.
5. Understand
external factors
when defining success.
This approach sounds simple but it isn’t.
Some boards consistently fail to implement
one or more of these principles.
CEOs who try to restrict what their
boards are allowed to hear don’t trust or
respect their boards. And boards whose
members don’t trust and respect each other
are dysfunctional. Disagreement, debate, and
eventual compromise are essential to a wellfunctioning democracy—be it a nation or a
cooperative.
Failing to plan for board member
succession also is all too common. Longtenured members who have lost their
effectiveness compromise many boards.
Tenure doesn’t necessarily affect ability,
but constant training is vital to keep board
members up to par.
And recruiting and preparing future
board members ensures that quality people
will set policy, and better ensures that your
board’s makeup will reflect the demographics
of your membership.
Co-op management requires a very
important set of skills and qualifications
that can’t be purchased cheaply. It’s common
for some volunteer directors to measure
the CEO’s compensation by comparing it
to their own compensation—a recipe for
disaster. Running a complex enterprise
requires finding and paying for the right
talent. Otherwise you’re short-changing your
members.
Compensation, however, is just one part
of the equation. You need to plan for the
right leaders by clearly defining what your
co-op needs and why. This means finding
someone with more than a well-written
résumé. Multifaceted organizations require
a level of intangible talents that include
empathy for members and employees,
confidence in setting direction and hiring the
right people, flexibility, self-awareness, and a
touch of humility. Dig deeper than the paper.
Lastly, understanding external
circumstances when defining success means
the board must understand the world that
surrounds the co-op and the influence
of global and local trends on a co-op’s
competitive capabilities. We don’t exist in
a vacuum, and what goes on elsewhere in
some manner eventually affects us.
Volunteer boards are too critical to co-op
success to not heed the insights of people like
Yvonne Evers. Mark Condon is senior vice president,
business and consumer publishing, for the
Credit Union National Association. Contact
him at 608-231-4078. A version of this
article appeared in Credit Union Magazine,
October 10, 2010.
BizUnite would like to thank our partners for a successful 2010
If you are interested in becoming a BizUnite member contact
Barth Getto · 603-628-2343 · bgetto@bizunite.com
12
Vermont Co-ops Invest in Employee Health
with Locally-based Online Weight Loss Program
By Alexandra Tursi
O
ne of the greatest challenges in today’s
workplace is managing employee
health care and its effect on employer
health costs. City Market/Onion River Co-op
and Vermont Federal Credit Union, both in
Burlington, Vt., are solving that challenge by
making an investment in employee wellness,
starting with employee waistlines. This
health benefit for workers illustrates how the
fifth and seventh Cooperative Principles—
education and concern for community—can
improve a co-op’s bottom line.
In September 2009, Allison Weinhagen,
then benefits manager for City Market, did
not know that she would lose 106 pounds
within a year. Likewise, Donna Bogue at
Vermont Federal did not know she would
lose 26 pounds and shave 100 points off of
her cholesterol, putting her out of the risk
zone for medication.
Both women and 36 coworkers signed
up for Vtrim Online, a nonprofit behavioral
weight management program developed
at the University of Vermont by Dr. Jean
Harvey-Berino, who has discovered the
secret to weight loss isn't what you eat, but
how you eat.
Losing Weight Together
Behavioral change is the cornerstone of
Vtrim. Participants learn how to lose weight
by altering their reactions to emotional or
environmental triggers through positive reinforcement of new behaviors, or reductions of
unhealthy behaviors. Participants walk away
from the program with a toolkit for making
better eating and exercise choices.
Changing behaviors is reinforced by
instructor and peer-to-peer support.
Small groups are at the heart of success
for participants—they meet weekly and
support each other via live chat. Both
co-ops’ employees also meet outside of class
to provide and receive encouragement.
Accounting Manager Cheri Robinson notes
that “City Market’s sponsorship created a
positive environment with a great deal of
support and camaraderie amongst fellow
co-workers who participated in the program. That we all had a common goal made the
experience much more fun.”
Both co-ops chose Vtrim because of its
foundation in clinical research, proven
record of success and its status as a nonprofit
that provides funding for academic research.
The cost of Vtrim Online is $375 per
participant. City Market pays for the
program up front, offers a $100 credit and
deducts the remaining $275 from employee
paychecks over the 12 weeks of the course.
Vermont Federal offers to pay for the
program in full if employees exhibit 100
percent participation; employees pay a $10
weekly co-pay over 12 weeks and receive
a complete refund of their co-pays if they
attend all classes.
“Both co-ops have made an investment
in employee health that, over the longterm, will not only benefit each employee
personally, but enhance the overall health
of the organization: healthier employees
equal a healthier financial bottom line,” said
Beth Casey Gold, Director of Corporate
Programming at Vtrim, who worked closely
with the co-ops and their wellness-focused
benefits broker Hickok & Boardman Group
Benefits on the partnerships.
On average, City Market employees have
lost 22 pounds since completing Vtrim one
year ago with an average decrease in body
mass index of 3.35 points. At Vermont
Federal, employees lost an average of 9
pounds with an average decrease in BMI of
1.45 points. A BMI of more than 30 indicates
obesity.
Typically, Vtrim participants lose one to
two pounds per week, which translates to a
clinically meaningful weight loss of at least
five to ten percent. Weight losses within
this range can lower blood pressure, reduce
cholesterol, better control diabetes and
decrease risk of developing Type II diabetes.
“Vtrim saved my life,” said Jeff Gorham, a
City Market employee who lost 40 pounds on
the program. “I was overweight and looking
at a future of blood pressure medications and
the high possibility of becoming diabetic.
With Vtrim, I lost the weight, my cholesterol
dropped 60 points, my diabetic risk went
from 10 to almost non-existent, and my BMI
went from a 31 to a 26.”
Currently, 66 percent of Americans
are overweight and 34 percent are obese.
The estimated overweight- and obesityattributable costs for companies are high:
$175 per year for overweight employees;
$2,485 per year for obese employees.
Data on financial savings from reduced
medical claims are not yet available, but both
City Market and Vermont Federal continue
to offer Vtrim Online, Vtrim II and Vtrim
Maintenance classes.
Members of City Market’s Vtrim class of 2009 pose together in the store’s produce section.
healthier alternatives when they snack during
the work day.
Most City Market employees live in the
downtown Burlington area in which they work.
By offering employees the means to improve
their health, City Market is in turn improving
the health of the community as a whole.
Both City Market’s and Vermont Federal’s
continual pursuit to enhance benefits to
employees aligns with Co-op Principles
of education and concern for community,
to enhance the benefits to members. Both
organizations want employees to make
healthy choices that benefit them and their
families; Vtrim is a program that allows them
to augment their current benefits package
for a reasonable cost to both the co-op and
the employee while providing long-term
sustainable benefits to both.
Alexandra Tursi is a senior associate with
Kelliher Samets Volk, a marketing communications firm representing the Vtrim Online
program.
Flexibility and Social Support
Participants meet for a weekly online
class led by a certified Vtrim facilitator—
typically a registered dietitian or masterslevel counselor—and 15-20 peers. Digital
tools include an online food journal,
exercise tracker and virtual pantry.
Facilitators provide feedback on the journal,
reinforcing behavior change and providing
encouragement.
“The flexibility of the online tools and
access was a significant factor,” said Deanna
Merola, Human Resources Specialist
at Vermont Federal. “Our employee
population spans four counties in Vermont
and because the program did not require
on-site participation, the online accessibility
was key for us. Although the cost may be
slightly more than other programs, it was the
modification of behavioral habits that we felt
was a critical component and an important
tool to provide our employees.”
The changes City Market employees have
made are noticeable and sustainable. Vtrim
has become part of the culture, from the way
employees recognize one another’s healthy
habits to the way they compliment the
changes that those healthy habits create.
City Market employees regularly
meet outside of class to offer each other
encouragement and the support continues
once they have completed the program, as
both cooperatives offer a range of benefits to
encourage good health: City Market offers
to all staff health club discounts, free onsite
annual health screenings, and access to a
“Learning Library” of health and wellness
resources. Vermont Federal offers annual
health screenings, flu shots and distributes
a “Healthy Snack of the Month” with the
intention of helping employees think of
The NCB Financial Group consists of the Congressionally-chartered National Consumer Cooperative Bank (NCCB)
and NCB, FSB, a federally insured savings bank wholly owned by NCCB. The NCB Financial Group provides
financial products and services for the nation's cooperatives, their members, and socially responsible organizations.
13
DevelopingViews
Developing Views features stories about developing co-ops—the inspiration
for them, how they execute their infrastructure and how they deal with the
challenges of being a new co-op. If you would like the world to know about
your new cooperative, please contact Andrew McLeod at amcleod@ncba.coop.
Converting an Existing Grocery to a Co-op
By Michael Kalagher
I
f you are fortunate enough to be driving
through rural western Massachusetts in
an area known as the Hilltowns you will
find a vibrant, full-service grocery called The
Old Creamery.
The Old Creamery is located on Route 9 in
the town of Cummington. The surrounding
communities have strong agrarian roots and
have annually held the Cummington Fair
since 1883. Three years after the first fair, in
1886, a group of local dairy farmers started
the Cummington Cooperative Creamery.
This became a very successful co-op and
in its heyday 145 dairies produced 20,000
pounds of butter per month. The farmers who built the old creamery
building enjoyed the benefits of cooperation
for over 50 years, but refrigeration and
motorized trucking in the 1940s brought
an end to that era and the Cummington
Cooperative Creamery closed.
In the years since the old co-op’s demise,
the building has housed either a restaurant
or a general store.
The Old Creamery is now the focus of a
co-op conversion from a privately-owned
market.
Only 3,000 people live within a five mile
radius of the Creamery. But in just over five
months nearly 350 people have joined the
forming co-op.
A Community Hub
The current owners of The Old Creamery,
Alice Cozzolino and Amy Pulley, have run
the business for the last ten years. During
their ownership Amy and Alice have
more than doubled the annual revenue,
dramatically reduced the debt load and made
substantial improvements to the building
and grounds.
The nearest other small grocery is 10
miles away; the nearest big box retailer is
over 20 miles away. Folks in this community
need and love the Creamery. It functions
as a meeting place, an entertainment venue,
an outlet for local artisans, a source for
locally grown foods and a community
education facility. The Creamery houses a
sustainability library and bulk food buying
club. Local musicians perform in the winter
evening "Coffee House" series. Dozens of
local artists and authors have their work
displayed and sold at the Creamery.
Cozzolino and Pulley are constantly
looking for the best possible items to carry
with clear priority given to sources close to
home. Organic and sustainably-raised meats
and produce are supplied by 25 local farms,
and regional wines, beers, and groceries are
carried.
The owners speak openly about the
challenges associated with running the
Creamery, noting that it has taken a toll on
14
their physical and emotional stamina. They
want more balance in their lives, but they
don’t want to simply sell the Creamery and
jeopardize its community values. Cooperative Succession
Cozzolino and Pulley started investigating
the co-op model in late 2009. After a
month-long series of informal “co-op
conversations,” a community meeting was
held to inform people about co-ops and to
determine if there was adequate community
support to explore the conversion of the
Creamery to a member-owned business.
More than 300 people showed up on a cold
Sunday afternoon to demonstrate their
commitment to the Creamery. Dozens
stepped forward offering specific help.
The co-op steering group formed four
working groups and began the necessary
planning. The group was conscious of not
“reinventing….” so early on we joined NCBA
and the Cooperative Grocers’ Information
Network. We learned from NCBA resources,
purchased many of the CGIN Toolboxes,
and took advantage of the free information
available from Food Co-op Initiative.
We also visited other cooperatives in
the region: Berkshire Co-op Market, Wild
Oats Co-op, Green Fields Market, Leverett
Co-op, and the Putney Food Co-op. The
cooperation, openness, continued sharing
and active support from these wonderful
sister co-ops continues to this day. Shortly
after these visits, agreement in principle was
reached on the purchase price and terms
for buying The Old Creamery. Financing
will likely include creative seller terms,
transferable debt, member equity, memberowner loans, gifts and grants, and a bank
loan. Less than 40 percent will be long-term
debt.
The Member Drive
In July of 2010 the member equity price
and benefits were set and our founding
membership drive was launched with goals
for 300 member-owners in 2010 and 500 by
summer 2011. By Thanksgiving, The Old
Creamery Co-op had 329 members, whose
equity is being kept in an escrow account
until the business transfer is complete.
The co-op was incorporated in early
August and the steering committee then
became the founding board of directors.
The cost of organizing efforts could not be
covered by store operations, as the co-op has
not yet purchased the business. A generous
early private gift helped fund a part-time
outreach consultant and a fundraising
consultant to augment the time and skills of
the board.
The current owners have been great
supporters, both sitting on the co-op board.
In September they decided to hold a 10
percent off “Co-op Owner Appreciation
The Old Creamery occupies a central historic building.
Day” on the 10th anniversary of their
purchase of the store. The all-day event
featured several local bands, cider pressing, a
magician and local food tasting. Sixty people
joined the co-op on that day alone.
Since that event, a law firm experienced
in cooperatives has been retained, bylaws
are in place, the business purchase and
sale agreement is progressing, policy and
procedure manuals are being developed. A
buildings and grounds five-year plan, led by
the donated services of a local architect, is
well underway.
Memberships and gift fundraising
continue going very well and a member loan
campaign will launch in early 2011. The Old
Creamery Co-op has subsequently joined
the Neighboring Food Co-op Association
and the New England Farmers Union, and
is looking forward to membership in the
National Cooperative Grocers’ Association.
There are not many examples of existing
businesses converting to co-ops, so the
organizers had to find our way at times, but
in the words of Kimberly Longey, board
president, “The ingredients for success
Photo: courtesy Michael Kalagher
are pretty straightforward. Start with a
significant portion of caring owners, add an
equal amount of committed community, mix
with lots of hard (and fun) work, and add
money until done.”
The following are practices and beliefs that
are guiding the board and member-owners
of the Old Creamery Co-op on our journey:
• Providing fresh and healthy food, from
as close to home as possible
• Making business decisions that reflect
care for the environment
• Keeping jobs and money working in the
local economy
• Being welcoming and caring for all in
our communities...
We will let you know when it is baked.
Michael Kalagher is a founding member of
The Old Creamery Co-op and member of its
board. More information can be found at
www.oldcreamery.coop. He can be reached
at michael@mandafarm.com.
New Congress, New Opportunities
By Adam Schwartz
T
he November 2010 elections will
change the way legislation moves
through the government over the
next two years.
Once again, we have a divided Congress
with the Republicans in control of the
House of Representatives by a nearly 50-vote
margin while the Democrats effectively
retain control of the Senate 53-47, as the
two independent Senators caucus with the
Democrats. Of course, Democrats retain
control of the executive branch.
Does this shift in power have significance
for cooperatives?
Cooperatives operate within a diverse
range of businesses, which gives strength
to the model. The over 29,000 cooperatives
in the United States operate in all sectors of
the economy, from financial services and
agriculture to housing and purchasing. Every
member of Congress, regardless of party,
represents cooperative businesses. Therefore,
NCBA’s message about the power of the
cooperative business model and its economic
and social benefits resonates on both sides of
the aisle.
The challenge is to educate members
of Congress about the diverse range of
businesses that are cooperatives and the
need to establish legislation that gives fair
treatment to cooperatives across all sectors of
the economy. While an individual member
may know about agricultural cooperatives
because they are in her district, she may not
be aware that many small businesses are also
cooperatives or are members of purchasing
cooperatives. Similarly, another may be
aware of opportunities for cooperative
development in rural areas but unaware
that no similar programs currently exist for
development in urban areas.
NCBA’s mission is to develop, advance and
protect cooperative business. Consequently,
our focus is on the business model rather
than on a specific sector. NCBA’s public
policy focus is on issues that provide benefit
to the greatest number of cooperatives. By
advocating for policies that promote the
cooperative business model and integrate
more people into a cooperative economy,
NCBA assists all cooperatives.
Currently, NCBA is working on the
following issues:
• To ensure that cooperatives are eligible
to access Small Business Administration
lending programs. In 2009, the House
passed H.R. 3854, the Small Business
Financing and Investment Act of 2009. The
Senate did not act on this provision. In the
new 112th Congress, NCBA will continue
to leverage grassroots support to advocate
for this legislation, which must be passed by
both the House and the Senate before going
to the president for signing. To learn more,
visit http://s.coop/61t.
• To create an urban cooperative
development program similar to the
Rural Cooperative Development Grant
program. In late 2010, NCBA worked
with the CooperationWorks! Urban Circle
and Rep. Chaka Fattah (D-Pa.) to create
legislation that would establish funding
opportunities for cooperative development
in urban areas. We expect the bill to be
introduced in early 2011, and its passage
will provide key support to healthy
communities through a wide variety of
cooperative development.
• To continue our strong support for
cooperative development in all parts of
the United States and around the world.
With our membership in the Overseas
Cooperative Development Council, NCBA
supports the creation of cooperatives
through the U.S. Agency for International
Development and other sources. NCBA’s
CLUSA International Programs then
provide the on-the-ground training with
the local population.
• To ensure that that tax and accounting
policies continue to recognize the
unique aspects of cooperatives. NCBA
has been leading the battle to ensure
that the Financial Accounting Standards
Board and its international counterpart
fully understand the implications of
their actions on cooperatives. We will
continue our efforts in both the regulatory
and legislative arena to ensure the
cooperative model is well understood and
cooperatives’ ability to operate as memberowned businesses is not negatively
impacted.
• To promote and protect the cooperative
business model. Recent efforts in this
area include the reform of secondary
housing market lenders Fannie Mae and
Freddie Mac and efforts to encourage
the Administration and Congress to
participate in the International Year of
Cooperatives. We are continuing our
work with the Administration on the
implementation of health care reform
legislation.
NCBA welcomes the opportunity to assist
specific cooperative sectors on issues that
support all cooperatives, such as increasing
the amount of business lending for credit
unions. According to an independent study,
raising the cap from 12.25 percent of assets
to 25 percent could create over 108,000 jobs
and support the very real credit needs of
many other cooperative businesses without
adding to the national debt.
Of course, not every sector-specific issue
will apply to all cooperatives, and many
issues that specific cooperative sectors
pursue will be beyond NCBA’s public
policy scope. However, keeping NCBA and
other sectors informed of those issues is
advisable as other cooperatives could become
powerful allies. The Cooperative Business
Journal provides your organization or sector
with a venue for informing the U.S. and
international cooperative community of the
legislative issues affecting your sector.
Adam Schwartz is NCBA’s vice president of
public affairs and members services.
Focus
For decades, CoBank has provided loans, leases and other
financial services to food, water, energy and communications
businesses throughout rural America.
We remain focused on supporting these vital industries.
We’re a financial partner that understands their borrowing
needs – and is committed to their long-term success.
To learn more about CoBank, please call 800-542-8072 or visit
www.cobank.com.
2009 new CBJ 10 x 6.5.indd 1
9:55:53
C O OPE R AT I VE BUSINE6/4/2009
S S JOUR
NA LAM
15
What do these
COOPERATIVE
BUSINESS PEOPLE
have in common?
They all have customized policies from
Nationwide® Insurance Company.
Only Nationwide agents offer customers On Your Side®
Reviews. We’ll look over your policy to find ways to
save and offer you better coverage options — before
you even have to ask.
Trust your local Nationwide® insurance agent to give
you the kind of coverage your business deserves.
Auto • Home • Farm • Business
nationwide.com
Products underwritten by Nationwide Mutual Insurance Company and Affiliated Companies. Home Office:
Columbus, Ohio 43215. Subject to underwriting guidelines, review and approval. Products and discounts not
available to all persons in all states. Nationwide, Nationwide Insurance and the Nationwide framemark are federally
registered service marks of Nationwide Mutual Insurance Company. Copyright 2010 Nationwide Mutual Insurance
Company. All rights reserved. SRFO032b (1110)

Cooperative Business Journal

Transcription

Similar documents

Transition Black Isle

April - Boone Electric Cooperative

March 2016 - Eastern Illini Electric Cooperative

Bendale Business and Technical Institute

Local Vendor Project: Cream Nut!

Green Means Go - Financial Center Credit Union

shared branching - Frontier Financial Credit Union

The Compost - Willimantic Food Co-op

REC Section - Ravalli Electric

Newsletter dated May 1, 2015