Community development block grant
The cooperative may prepare certificates evidencing the issuance of
preferred shares, if any?
If a share is expensive, can the worker purchase it over time or find personal financing?
Although somewhat rare, there may be sources of loans to help individual cooperative members
finance the purchase of their membership share.
Value of preferred shares X dollars
May a member receive a membership share in exchange for goods or services? Some
cooperatives allow members to “pay for” their membership share in exchange for agreed upon
good or services. The value of the membership share may be taxable income to the member, so
it is important to consider whether a member would be prepared to pay taxes on the value of that
share. Note, also, that provision of services in order to purchase a membership share may create
an employment relationship. See the chapter on employment law for more details
Potential fiscal sponsors for matching funding:
Washington Area Community Investment Fund
Bread for the City
Workforce Investment Council
Non-voting equity for members:
All logged contributions that meet the following conditions will be rewarded with a 5-7% semi-annual interest return on their investment in proportion to overall business profits at the end of the fiscal year.
The value of contributions will be measured in hours of approved work or direct capital investment (or in the form of a loan). Project and task-based work will be valuated and logged at the time of execution. A timesheet or purchase order record must be submitted within a reasonable timeframe as to be determined by the board.
Paid work for customers, including referral commissions, do not qualify as non-voting equity but will be paid immediately upon customer payment of the respective services.
Non-voting equity customer, partner, or public contributions:
Customer payments may be retroactively approved as non-voting equity if the customer signs and submits the member bylaws within 3 months of the services or products purchased: