Make Co-ops Great Again

V.2, N.60

If the new Republican majority wants to prove that it’s friendly to small businesses, to forgotten communities, and to fewer regulations, here’s a great place to start: Enact a federal statute that allows communities to organize cooperatives for any purpose, including local investment. 

In Alberta, arguably the most conservative province in Canada and home to the oil/tar sands industry, investment cooperatives have been legal since 2009. The Sangudo Opportunity Development Co-op, for example, helped a small rural town save a butcher shop, convert an old Legion Hall into a public market, and build new affordable housing.

Today, the United States has a crazy quilt of federal and state laws governing cooperatives, and many consign these important business structures to the fringes of our economy. (Cooperatives currently employ just over one percent of the US workforce.) As our first article on the virtues of “mutualism” laments, some laws prohibit communities from creating internet companies, while others prohibit cooperative solar utilities. And no community is allowed to create a cooperative for investment purposes. (If more than 40% of a cooperative’s capital is invested in other businesses or cooperatives, it is considered an investment company and huge regulatory burdens follow.)

Despite these legal challenges, interest in cooperatives is spreading. Below, you will find another article about the new Drivers Cooperative - Colorado, which enables former Uber and Lyft drivers—who, once expenses are tallied, had been earning below a minimum wage—to improve their incomes by owning and running their own rideshare company. 

A third article describes the role Canadian cooperatives are playing in getting the country to net zero.

We also linked the latest study by Good Jobs First, which has evaluated the transparency of local economic development departments. For context, there’s a mountain of evidence that state and local incentive programs to attract outside companies are economically nuts. The cost of producing a job through attraction can reach over $500K, while the cost of creating a job by rewarding local businesses that expand is typically $1-2K. Transparency can help prevent these foolish decisions by exposing the culprits. Good Jobs First’s report card on the incentive programs of 229 small- and medium-sized cities found, shockingly, that only 11 percent “meet transparency expectations.”

Our fifth article reports on some of the amazing work happening in Baltimore to revive small-scale manufacturing. The number of “product-based businesses” in the city has doubled in the last five years thanks to a growing network of incubators, accelerators, and makerspaces.

Finally, a heads up that we will send you a note around Thanksgiving encouraging you to upgrade your subscription. Paying subscribers get the MSJ Extra! in off-weeks, featuring great original interviews with movers and shakers in the local investment universe. They also get our latest listings of local investment opportunities from coast to coast. But there is no need to wait for the pitch—just upgrade today through the link below. Or give a gift subscription for Christmas!

- Michael Shuman, Publisher

NEWS

• Restoring Community Economies by Reestablishing the Right to Associate, Nonprofit Quarterly (November 13)

• Denver Rideshare Drivers Launch Worker-Owned Co-op, High Country News (October 31)

• Economic Development Transparency in Small- and Medium-Sized US Cities, Good Jobs First (November 14)

• Achieving Net-Zero Emissions Through Community Wealth Building in Canada, Policy Options (November 4)

• Made in Baltimore Program Boosts Locally Produced Goods, NextCity (November 7)

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WHAT YOU MISSED IN THE LAST MSJ EXTRA!

SPONSOR CORNER

The National Coalition for Community Capital (NC3) is dedicated to educating, advocating, and activating community capital—and serves as MSJ's fiscal sponsor. Thank you for being a part of a growing movement! Contact NC3 for support integrating local investing in your work: info@nc3now.org.

NC3 UPDATES AND ANNOUNCEMENTS

Changing the Paradigm: Mobilizing Community Investment Funds: Community investment funds are the structures NC3 is building in communities across the nation to facilitate wealth-building. Join us on March 7, 2025, in East Lansing, MI, to hear the insights from communities we're working in and to meet experts on a fund for your community. Stay tuned for registration details coming soon!

Coalition Conversations: Tune into our monthly conversations with leaders in the field. NC3's CEO, Chris Miller, speaks with Kate Redmond, Co-Executive Director of Commongrounds Cooperative. With the support of over 400 community investors, the community-funded cooperative project in Michigan raised $1.8M of the $18M total project. Kate shares how Commongrounds' investment crowdfunding campaigns fit into their broader fundraising, why they chose to pursue investment crowdfunding, and what promise this strategy holds for wealth-building in communities across the country. The Coalition Conversation will be posted to NC3's LinkedIn, Facebook, and Instagram accounts next Tuesday at 2 pm ET.

PARTNER NEWS & VOICES

• Economic Change Precedes Political Change, ImpactAlpha - featuring Candide Group (November 7)

• CfPA Summit Provides a Vision for the Future, Superpower for Good (November 6)

• Moving Ownership’s Moment Into a Movement, Ownership Capital Lab (October 28)

NEW INVESTMENT OPPORTUNITIES

Our complete list of recently posted investment opportunities has moved to MSJ Extra! As a teaser, here is an offering from our list. (Please note that our listing of these opportunities is not an endorsement. Remember that all investments are risky, so click on the hyperlinks and read all the details carefully before investing.)

• West Lombard (Scappoose, OR) - Small Change: Building new Net Zero multifamily residences.

NOTABLE NEW RESOURCES

• Community Capital Live with Lyneir Richardson of Chicago TREND (November 21)

• How Has Structural Racism Held Back the Co-op Movement? Media Economies Design Lab (November 4)

MSJ EVENTS

• Community Capital Live: Adriana Abizadeh of Kensington Corridor Trust - Virtual Event: December 4, at 2 pm ET

MORE EVENTS

• Ujima Fund 2024 Business & Investor Relations Gathering - Hybrid Event (Roxbury, MA): November 22, at 6 pm ET

• The Future of Work: Employee Ownership and Economic Transformation - In-Person Event (Australia): November 25

• Bringing the Economy Home: Degrowth and Local Investing for a Sustainable Future - Virtual Event: December 3, at 2 pm ET

• Next Economy Living Q & A Session - Virtual Event: December 19, at 4 pm ET

JOBS BOARD

• East Bay Permanent Real Estate Cooperative: Real Estate & Finance Analyst

• North Carolina Employee Ownership Center: Executive Director

• Project Equity: Content Manager

• SV2 - Director of Impact Investing

• Wholehearted Bookkeeping Cooperative: Cooperative Bookkeeper

ASKS

If you or your community has a project on local investment or local economies that needs help, please let us know. We invite our readers to assist each other.

• Independent businesses and community members will celebrate Plaid Friday, the day after Thanksgiving. This year’s event falls on Friday, November 29, 2024. Wear plaid on Friday to show your support for your local economy and commitment to buying local this holiday season.

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