New York City's "Workers Development is raising $500,000 for Workers Diner by means of a "direct public offering" or DPO. These funds will be employed to build the restaurant, purchase equipment, train new worker-owners, and obtain the appropriate city and state permits. Until the minimum offering amount of $450,000 is achieved, all funds will remain in an "impound" account at Lower East Side People's Federal Credit Union. Workers Diner is legally qualified to accept stock investments from local supporters in New York and Connecticut. Furthermore, due to unique securities laws meant to encourage small business, we will also gain permission to advertise its stock sales by means of traditional media, such as magazines, newspapers, radio and the internet. Importantly, Workers Diner will only sell cooperative "preferred shares:" this type of share guarantees that profit and voting control remain in the hands of worker-owners. At the same time, investors can expect a fair and fixed return on their investment. In the future, worker-owners will also be required to invest in the business."
An inner-city cooperative is inviting the general public to buy investment shares as a way of promoting “economic healing”. Today Neechi Foods Co-Op launched its first Investment Share Offering. The purpose of the share offering is to help raise capital needed to complete the development of Neechi Commons Community Business Complex at 865 Main St. The Investment Shares are being sold to the general public, marking the first time that any cooperative in Manitoba has offered shares to non-members as well as to members. Residents of Manitoba will be eligible for the Province’s 30 % Community Enterprise Development Tax Credit on share purchases of up to $30,000. These Class A Shares are modestly priced at $100 per share to encourage broad public participation. Class B shares, which sell for $1,000 each, are geared to organizations and to individuals who do not qualify for the provincial tax credit.
Neechi is hoping to tap into the growing public interest in socially responsible investment (SRI), whereby monetary returns are balanced with social and environmental benefits. Neechi’s president, Louise Champagne, emphasized that, “investing in Neechi Commons is not about chasing speculative cash gains”. “Instead, it is about investing in a down-to-earth business that projects large community benefits alongside relatively modest financial returns. It is hoped that Neechi Commons will open in June, helping to bring badly needed revitalization to Main Street north of the CPR tracks and to adjoining north-end neighbourhoods. It will feature a neighbourhood supermarket, a fruit and vegetable courtyard and farmers’ market, cafeteria restaurant, specialty boutiques, a bakery and an Aboriginal arts centre. About 60 jobs will be created, drawing heavily on local area residents in a part of town that has one of the highest urban unemployment rates in Canada. Many of the jobs will go to youth. “It is high time that dignified and meaningful jobs start replacing street gangs”, says Champagne. “Economic balance and self-reliance in Aboriginal communities have been undermined for a very long time. We hope that Neechi Commons will be part of the economic healing that is needed to support personal and social healing.”
The Neechi Commons facility is a make-over and expansion of the old California Fruit Market premises. Now close to 90 per cent complete, it includes geo-thermal heating and cooling and already has been awarded Green Globes certification for its high environmental standards. Project costs for Neechi Commons include property acquisition, construction and opening costs totaling over $7 million. Neechi’s business plan projects $1.5 million in share capital. Both the provincial and federal governments have provided substantial capital grants to help cover construction costs and Assiniboine Credit Union, The Jubilee fund, the Canadian Worker Co-op Federation, co-op members and other individuals have provided credit to advance the construction. “Now we need public support to complete the long-term financing required to make the Commons a success”, says Champagne. “Neechi” (often spelled “Nijii”) is an Ojibwa and Cree term for friend, or sister or brother.
The components of the Investment Share Offering Package can be opened in the following pfd files:
In a recent meeting at the Small Business Administration, NCBA discussed the different types of cooperatives and how they relate to the agency’s lending programs. SBA staff determined that worker cooperatives are eligible for loans from intermediary lenders participating in the new ILP program. ILP Intermediaries will be selected this summer, and should be ready to start making loans under the program in the fall. NCBA will continue to assist SBA on this issue, including exploring the financing of all types of cooperatives under SBA’s other lending programs, and looks forward to working with them in the future.
For more information, please contact NCBA’s Director of Public Policy R.L. Condra at email@example.com or 202-383-5480.