Cooperative Community Funds

Steve Stroup, co-op and community development coordinator at Bloomington Cooperative Services (Bloomingfoods) in Bloomington, Indi., is busy working on a presentation to the Bloomingfoods board about the recent matching grant the co-op has won to begin funding a Cooperative Community Fund (CCF). (See sidebar.) Bloomingfoods is one of eight co-ops to have been awarded a matching grant of $5,000, making the total number of CCFs 18 nationwide.

A Cooperative Community Fund (CCF) is an endowment food co-ops can sponsor for the purpose of more effectively managing and highlighting their giving programs. Administered by Twin Pines Cooperative Foundation (TPCF), the CCF program puts into tightly knit practice three cooperative principles: member economic participation, cooperation among cooperatives, and concern for community.

“Making the decision to fund a CCF gives us a chance to highlight the fact that these three powerful principles can be connected,” said Stroup. Having once served on the advisory board for the local United Way, Stroup is no stranger to the art of soliciting and managing charitable contributions. Stroup was hired at Bloomingfoods in July 2005 to help with member services projects related to expansion: an upcoming member-owner loan drive, the development of a stronger local business member benefits program, and the inception of the Bloomingfoods Cooperative Community Fund (BCCF).

Also in the Midwest, at Seward Co-op Grocery & Deli in Minneapolis, Susan Hawks has just published an article in Sprout, the Seward newsletter, announcing the new Seward CCF to members.

“Education is a big piece of the process,” Hawks observed. As marketing and member services manager, she understands the importance of clear member and staff communications. A new program like the CCF needs to be differentiated from existing donations efforts, such as the (also new) Seward Grants Program. “The difference with the CCF is that it’s part of a foundation. Eventually, as the fund grows, our board may be in the position of drawing entirely on interest from the fund to award grants to local organizations.”

Partnering groups, new CCF sponsors

With the help of the matching grants, eight co-ops will begin new funds this year, with one fund started jointly by two stores. This represents a third wave of growth for the Twin Pines Cooperative Foundation, which began administering California CCFs in 1995, modeled on a fund begun in 1990 at North Coast Cooperatives in Eureka/Arcata. The California CCFs (at Briarpatch Community Market, Davis Food Co-op, Co-oportunity, Isla Vista Food Co-op, and Sacramento Natural Foods) have met with impressive success.

A second wave of growth in 2001 saw co-ops outside California join the CCF program. Food Conspiracy in Arizona, Peoples’ Food Co-op in Wisconsin, and Weaver Street Market in North Carolina all came on board. Hanover Co-op (in Hanover and Lebanon, N.H.) began the Hanover Cooperative Community Fund (HCCF), creating an advisory board responsible for running the program. Under their stewardship, the HCCF has since grown to over $170,000.

TPCF gives first priority to reinvesting the endowment to cooperative development organizations in regions where there are strong CCFs. So far, Hanover’s local success has resulted in TPCF investments of over $400,000 in New England organizations dedicated to cooperatives and nonprofits.

Hanover Co-op communicates regularly with members about all aspects of its fund, fostering a sense of ownership and pride in its achievements. The 2004 Hanover annual report highlights the fact that during the year the fund received $16,765 in patronage rebates and checks; $1,086 was given at registers; and staff raised $2,600 in an annual HCCF walkathon.

“Contributions to a CCF double the strength of your donated dollar,” explained Jean Kautt, member-owner services coordinator at Bloomingfoods, where she manages donations. She looks forward to building a more visible giving program with the CCF, one that complements and supplements other community giving efforts.

“Earnings on our CCF have the potential to make our donations to local nonprofits even more meaningful, while the principle provides loan capital and investment income to nonprofits and co-ops in our region. I was thrilled, for example, to learn about the check for $101,000 TPCF recently presented to Organic Valley in rural Wisconsin. It’s all about going around and coming around with foresight and generosity—and that’s a beautiful thing.”

David J. Thompson, president of Twin Pines Cooperative Foundation, notes with pride that TPCF is now the largest co-op investor in Organic Valley. He responded to unprecedented interest in the CCF matching grants this past year (when he received 26 inquiries from food co-ops across the country) by approaching other groups for additional funding support.

“What is truly wonderful is that Blooming Prairie Foundation, the Cooperative Foundation, and the National Cooperative Bank Development Corporation all joined TPCF to give matching grants to the new funds,” said Thompson. “As a result, $70,000 was added to the program.” Over half of the matching funds were directed to specific geographic regions, broadly scattering the CCF concept over wider ground.

“It is really exciting to be taking this very large step,” said Thompson. “We’ve not only doubled the number of co-ops participating in the CCF program, but we have co-ops involved from almost every region in the country. CCF growth is ramping up both the awareness and the funds available for cooperative development.”

Thompson continues to look ahead: “The fact that other organizations stepped forward to help us make matching grants spurs us to cast an even wider net. The TPCF board has already approved another round of grant applications to go out this year.”

Customized to local and regional needs

Individual co-ops are encouraged to begin developing their CCF in a way that supports other strategic goals. At a time when many co-ops are building new stores or remodeling, this may mean timing CCF fundraising efforts so as not to confuse member-owners.

Kris Nelson, general manager at Lakewinds Natural Foods in Minnesota, appreciates this. Lakewinds has just raised $900,000 in member loans to support the relocation and expansion of the Lakewinds Minnetonka store (scheduled for completion in early 2006), as well as a brand new footprint in Chanhassen (opening in late 2005). A whirlwind effort of this scale has meant holding off on launching the Lakewinds CCF until after the grand openings. At that point, though, Nelson predicts that the co-op’s CCF efforts will benefit from increased member loyalty and excitement, the anticipated result of the successful completion of two such ambitious expansion projects.

“The obvious reason for being involved in the CCF,” noted Nelson, “is that you multiply your efforts. Twin Pines invests in other co-ops that share our values, while we give back within our communities. It’s a way of showing our customers how we are linked and how the money we invest can keep coming around.”

At Valley Natural Foods in Burnsville, Minn., Marketing and Membership Manager Charli Mills dreams of using their new CCF to enhance the co-op’s commitment to health and environmental education.

“The exciting pinnacle will be the day our CCF becomes a contributor to our community outreach,” said Mills. “So many things are possible. We could deepen our partnerships with local schools to help them transition from pop-machine culture to a healthy environment. Already, we are sponsoring a full-day kindergarten class with plans to replace the school’s Wendy’s Night with a Shop the Co-op Night, with a percentage of the profits going back to the school. That’s an example of something the CCF could ultimately support.”

Because a CCF fund interweaves three cooperative principles to build a supportive capital web, it’s an ideal vehicle for co-op education. Even today, many co-ops continue to be small, independent, and marginal. When co-ops are invested in their local communities to the exclusion of external alliances and networks, they remain vulnerable and—paradoxically—less capable of responding to local needs.

Michelle Schry, general manager of People’s Food Cooperative in La Crosse, Wis., was an early midwestern advocate of the TPCF. “At Peoples’ Food Co-op, we are using our CCF to actively try to build cross-sector investment in the Coulee Region,” she explained.

“In our part of rural Wisconsin, there is a strong tradition of cooperatives of many kinds, but people still don’t necessarily understand that we all operate according to a similar business model. Co-ops really stand for the community ownership of resources. The fund gives us one more way to try to create connections in peoples’ minds about what it is that we do.”

Schry recently led her store through a successful expansion, adding a seasonal restaurant, Hackberries, on its second floor. “Our mission is not just to show how we positively impact the community because we are a vibrant business, but also to demonstrate how co-ops relate to each other, creating a positive impact on the overall economy of our region.”

“Our biggest challenge right now is for co-ops to take each other seriously,” Schry observed. Recently elected to the CDS (Cooperative Development Services) board and also serving on the board of the National Cooperative Grocers Association, she has been sharing this reflection with others.

“We need to be developing stronger, more visible links among and between co-ops. While we’re still early in the process of building the Coulee Region CCF, we are obviously laying the groundwork for a long-term commitment. With our recent expansion we’ve shown the community that we are a viable, thriving business. That helps create more interest in the fund. This kind of investment is the next step, another way of expanding the circle and stretching our reach.”

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Ellen Michel is marketing communications manager at Bloomingfoods in Bloomington, Indiana ([email protected]).