cooperatives: the washington (and beyond) perspective
TRANSCRIPT
Cooperatives:The Washington (and Beyond)
Perspective
By
Adam SchwartzVice President of Public Affairs & Member
ServicesNational Cooperative Business Association
Washington, DC aka Disney on the Potomac
NCBA’s Mission
To Develop, Advance & Protect Cooperatives from all Sectors
Connecting Co-ops
Media
Other Co-ops
General Public
Government
Co-ops
NCBA Benefits
The Seven Cooperative Principles
Voluntary and open membership Democratic member control Member economic participation Autonomy and independence Education, training and information Cooperation among cooperatives Concern for the community
U.S. Data on Cooperatives
29,284 cooperative firms 72,993 establishments2 million plus jobs $652 billion plus in revenue$133.5 billion in income$3 trillion in assets
THE BIG PICTURE
Connecting Indiana Co-ops to all Cooperatives
Indiana Cooperatives
State Affiliates
ICAGlobally Connected
NCBA Other National Organizations
NCBA’s Overall Public Policy Priorities
Secure Private and Public Sources of Funding for Cooperatives Promote Co-op DevelopmentDefend the Co-op Model of Business
NCBA and Capitol Hill
Health Care and Co-ops
Types of Health Care Cooperatives
Consumer Owned
Worker Owned
Purchasing by Small Businesses
The Current Health Care Bill
Small Business Administration Developments
H.R. 3854 Small Business Credit Expansion Act 2009
Passed the House ensures all co-ops not organized as tax-exempt may obtain SBA financing
Rural Cooperative Development Grants
$11.4 million in total fundingIncludes $300,000 for continued research on economic impact of all cooperatives
The National Co-op Directory
NCBA working with several partners to create an on-line directory of all 29,000 cooperatives that you will be able to search by zip code
EQUITY FUND FOR COOPERATIVES
GOALS:To create an investment vehicle that will allow individuals organizations to invest in a fund that will invest exclusively in cooperatives including credit unions
Pay investors a market or near market return
CREATE ACCESS TO CAPITAL
Outside Private Capital
Outside Private Capital
Cooperatives—and other businesses—that
Receive At Risk Capital
Cooperatives—and other businesses—that
Receive At Risk Capital
Public FinancingPublic
Financing
Cooperative Capital
Cooperative Capital
Cooperative Cooperative Capital Fund Capital Fund
(CCF)(CCF)
Cooperative Cooperative Capital Fund Capital Fund
(CCF)(CCF)
Cooperative Ownership of Fund Example with CDF-issued Co-op Investment Note
Fund ManagerOriginationMonitoringServicing
Senior Debt $2.5 MM
Junior Debt $2.5 MM
Equity $1.0 MM
Worker Co-op(ex: 7% senior)
Purchasing Co-op(ex: 10% sub-debt)
Consumer Co-op(ex: 8% preferred equity)
Producer Co-op(ex: 11% member equity)
National CooperativeEquity Fund, LLC
(NCEF)$6.0 MM Total
Cooperative Dev.Foundation (CDF)
Lends to NCEF
Retail Investors•Credit Unions sell charitable CDs •CU members buy charitable CDs•CUNA Mutual sells CDF notes •CU member buy CDF notes•Proceeds go to CDF
InvestorsDebt
Equity / Ownership
CO-OP 1 < 25%CO-OP 2 < 25%CO-OP 3 < 25%CO-OP 4 < 25%… Total 100% $1 MM
Institutional Investors(Foundations, Banks, etc.)
Lend to NCEF
Sample Investments
$2.5MM2% 5yrs
$2.5MM3% 5yrs
$2.5MM5% 5yrs
$1.0MMEquity
Fund Management
Fees
Working with Your Public Officials
Invite Candidates/Legislators to:Annual MeetingTour Your Co-opState Co-op SummitPrograms on the critical issues relevant to Hoosiers
