Check out Executive Director Matthew Epperson presenting Georgia Cooperative Development Center for 1 Million Cups Athens on May Day 2019. 1MC is a project of the Kaufman Foundation, which believes that it takes a million cups of coffee to successfully launch a new business. In this video, Matthew details some of the history of both cooperatives, and GCDC in particular, the opportunity we see for supporting development in the state of Georgia, and why today is the day, and we are the ones we’ve been waiting for. A short Q&A follows the presentation.

By Matthew Epperson, Executive Director, Georgia Cooperative Development Center, 4/8/2019

GCDC was invited to the inaugural network gathering of the Southern Reparations Loan Fund (SRLF). SRLF has been an active loan fund in the South for a few years, helping to finance 4 projects to date: the Renaissance Community Co-op in Greensboro, NC, Rebel Threads printmaking co-op in Miami, FL, Emma Community Power in Asheville, NC, and one other project. SRLF had been a member of the Working World, an international leader in non-extractive finance and progressive philanthropy, but has decided that instead of being a lender itself, it has pivoted into the role of being an umbrella organization for a multitude of smaller loan funds working on the ground with those most impacted by extractive (or “zombie”) finance. GCDC was invited as a proto-loan fund, exploring what lending in Georgia might look like.

Day 1 was “the why”. To the SRLF paradigm, why make non-extractive loans to disenfranchised and oppressed communities? Because changing the ownership of capital to be inclusive and heal the wounds of extractive finance will mean transforming our world into one where people own the surplus value of their labor, and the capital necessary to be productive, healthy, happy and in community without the draconian shadow looming overhead. This sounds lofty, and it is, but what I so deeply admire about the work Ed and Marnie do (Ed and Marnie are co-Executive Directors of the Fund for Democratic Communities, an anchor partner with SRLF) is that they so effectively soar into the abstract and then dive deeply into the earth, the grassroots, to offer a method of 

finding real solutions to those systemic problems. There is a cosmology here you might say, of what Ed called Bones, Blood and Dirt. And in this story of human history, the enclosure of land and labor into commodities was physically assured by military might (the club, the gun, etc.), but then psychologically assured by modern extractive finance. Thus, to address finance and put it back into the hands of people who do the labor that creates surplus value, and capital, will mean transforming the whole system into another world that works for the many, not just the few.

Day 2 was the how. The mechanics of Seed Commons: The national loan pool seeks philanthropic capital to keep itself solvent. The fundraising is done mostly by Brendan Martin (Working World) and Marnie Thompson (F4DC) who are connected to alternative philanthropists (like the Chorus Foundation, Resource Generation) and seek out values-aligned donors and lenders for the main pool. This seed funding is then applied for by primarily people of color led worker cooperatives that are in alignment with the Seed Commons values, to be assisted by the micro loan funds on the ground near those co-op steering committees (also aligned with SC’s values), as well as to be assigned a loan coach from Seed Commons to help ensure the success of the co-op. The loan coach is modeled on the “padrino” or “godfather” model used by the Mondragon co-ops. There is an application process to access the national pool of funds, all of which is processed through a software called Madeline (developed for Working World). Rarely will the selection committee say “no”, but they will often say “not yet, work on these things…” before a loan is first made. The values of Seed Commons are: non-extractive finance (see above), building solvent businesses, and paying it forward. On paying it forward, once the co-op achieves profitability, it begins to repay the loan, but only a small % goes back to the national loan fund. Most of it goes into the local pool, which will then be used for another co-op project. If the co-op defaults on the loan, nothing will be repaid by the co-op. Intentionally, these are non-collateralized loans. The loan funds are truly sharing the risk of default, but working closely with the projects to help defray this possibility of default. So far, this method is working and the repayments have been consistent.

Day 3 was next steps. Each loan fund used a Getting Started worksheet to help plot out where their organization is now, and who might need to be involved to get a proto loan fund to being a bona fide loan fund. We also laid out next steps, which for GCDC I defined as:

• Share the learnings of this gathering back with key stakeholders, deeply and broadly
• Work more closely with the Highlander Center on strategies for community organizing
• Work on Steps to Startup
• Work on a culture exchange between Pinewoods community in Athens and Poder Emma in Asheville

From here, GCDC will explore how this all might work in Georgia. The board of directors and ED will be going into strategic planning soon to more deeply answer these questions. But I can say without a shred of doubt that I walk away from Germinate feeling inspired and challenged, and want to see this great work growing in Georgia soil where the work of repair is so crucially needed. It was touching to hear people share so deeply about their relationships with money, and articulation of a new vision of people in relationship with money they own, because it came from the sweat of their brows, and their ancestor’s brows. Stay tuned!

Post by Matthew Epperson, Executive Director, Georgia Cooperative Development Center, 4/7/2019

January is a cold month, even in Georgia, and it leaves much room for grimacing and other displeased facial expressions. But take one look at the faces in the photos from SJS 2019 and you’ll see, this was a positively uplifting experience for many, if not all of those involved, particularly me. Georgia Co-op Development Center submitted a panel presentation titled “An Athens Economy That Works for More Folx” and we were accepted! The panel featured 4 great panelists: Kara Brown, General Manager  of Daily Groceries Co-op, Almeta Tulloss with Cherokee Moon Mixology, Greg Wagstaff with Swadeshi Co-op, Zack Godfrey with B Lab UGA, and Patrick Davenport with Peachy Green Clean Co-op [Zachary with Normal Landscape Co-op was unable to join us].

After some introductions to what is an eco-nomy (from the Greek oikos house + nemein to manage; just think of a circle that links together land, labor, capital, reuse/disposal and worldview) I contrasted the dominant extractive economy of today (think take, make, waste in a single forward line) with a future economy of regeneration and reparations (solidarity and intersectionality, in a circle) dominated by cooperatives and other democratic players. To help think about that future, I invited these Athenians who are pre-figuring that future economy to share their experiences.

We shared some of what’s working (empowered workers, local value chains that strengthen the Athens community keeping dollars local) and what’s most challenging (poverty at 37% in ACC, lack of capital access and co-op education, missed opportunities to collaborate across silos like UGA with the community, racism, among others), and discussed if building more co-ops was a kind of reparations. We didn’t get very far on that last crucial question, but thanks to the distinguished presence of Dr. June Gary Hopps, we got to learn Mayor Maynard Jackson was able to do reparations work in the building of Jackson-Hartsfield Airport, intentionally setting the expectation that the general contractor hire Black owned building companies.

It was a lot to do in an hour! If you’d like to hear the audio, you can follow this link to listen to the whole recording: https://drive.google.com/open?id=1SiUXUfPyIOqGwUrkuWoQBmuQOtO4otkd

Southern Journeys LLC, a worker-owned sewing company, connects skill, craft and cultural practice to basic needs and basic needs to collective resourcefulness and capacity. The members of Southern Journeys represent a long and revered tradition of hard-working, enterprising women, mothers, community leaders and activists. Southern rural Black communities have survived and thrived due not only to their perseverance, but because of internal networks of cooperation and collective action in the face of seemingly insurmountable odds.

In 2004 the Southern Rural Black Women’s Initiative (SRBWI), a nonprofit collaboration committed to Black women’s leadership and empowerment, asked women in rural communities spanning the Alabama and Georgia Black Belt and Mississippi Delta – If you could improve your lives and your community, what would you need?  What would you do? Some of the women attending listening session across 77 counties in the Alabama and Georgia Black Belt and Mississippi Delta responded by expressing their desire to utilize their sewing skills as a means of generating additional income and perpetuating African American quilting and sewing traditions and so Southern Journeys began.

SRBWI provided legal and technical expertise to advise the women on creating a worker owned structure. “There is a difference between sewing for yourself and doing a line that has been decided on (by the group),” said Shirley, a Southern Journeys worker-owner whose mother made clothing for her and her seven siblings from flour sacks. “We went through a lot of training just to get our mindset from thinking as home sewers to thinking as a company,” adds Sonya, a worker-owner who served as a machinist in the Navy.

In addition to fabrics purchased at a discount in bulk, initial collections were created utilizing up-cycled feed sacks and colorful hand dyed fabric purchased from a women’s collective in Ghana. Consultants worked with the company to explore market and product development ideas that incorporated the goals of cultural preservation and sustainability. In 2010, after organizing and working with staff and technical experts on marketing, sales, product development, business structures, and the intricacies of cooperation, Southern Journeys LLC, a worker-owned cooperative enterprise, was incorporated as a worker-owned company under an LLC structure (see Roland Hall’s recent post for more on this type of legal organization).

Today, nine Southern Journeys’ Member Owners and other women who sew on contract, are committed to harvesting the seeds planted. “We have gained not only skills and business revenues at this point, but also a deep commitment to building a sustainable company”; a company that Southern Journeys worker-owner Dorothea envisions will provide “jobs and products for a new generation”.

Over the past 10 years Southern Journeys has been propelled by a small and committed team of members who have stuck together, formed meaningful relationships and friendships and remained committed to the big picture in spite of logistical, economic and personal challenges.  Without this internal engine of women driving, inspiring and rallying others to join and committed to a long term vision, there would be no Southern Journeys.  Additionally, the development of Southern Journeys has depended on core support for organizing, training and technical assistance from the Mary Reynolds Babcock Foundation, the Kellogg Foundation and in the early years, the Ford Foundation, providing women with the opportunities to build technical, practical and relational skills and leadership capacity.

The informal economies of rural life, cultures and communities do not receive recognition as social innovations and innovators in a capitalist system that rewards competition and greed. When they do it is usually granted to someone from “the outside” that has come to help.  However, within a system that has historically oppressed and isolated communities of color, both socially and economically, it is cooperative networks that have provided a means of meeting basic needs of food and clothing, generating livelihood opportunities, and building community and economic assets. In isolation, small scale cooperative initiatives achieve important goals. But collectively, they represent a larger vision of shared prosperity and cultural and artistic value, not just from the communities that have given birth to them, but to society as a whole.

You can visit the Southern Journeys website at www.sourthernjourneyscollective.com

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Sarah began at Goddard College in 2008 as faculty for the Sustainable Business and Communities MA and helped to found the MA in Social Innovation and Sustainability. For the past 14 years she has served as the Asset and Finance Development Director for the Southern Rural Black Women’s Initiative for Economic and Social Justice.

One of the initial questions for a group forming a cooperative in Georgia is whether the cooperative should be legally organized in Georgia or in another state.  This question most often comes up because Georgia, unlike some other states, has limited options for legally organizing cooperatives.  While other states may have specific statutes for forming worker cooperatives or grocery cooperatives, Georgia’s statutes only address electric cooperatives, telephone cooperatives, and certain types of agricultural cooperatives.  The impression that Georgia is a “cooperative desert” leads some to the conclusion that their cooperative cannot be organized in Georgia and should be organized elsewhere.

Although there are few statutory options in Georgia specifically aimed at cooperatives, it is relatively easy to organize a Georgia limited liability company or for-profit or nonprofit corporation as a cooperative in a way that complies with the cooperative principles and with cooperative tax laws and accounting practices.  While explaining how this is done is best reserved for a separate blog post, the point is that cooperatives can be organized in Georgia without difficulty.

If the cooperative will be physically based in Georgia and will be performing work or services or selling products primarily in Georgia, I generally advise that the cooperative be legally organized in Georgia as well unless there is a compelling reason to organize elsewhere.  If under these circumstances the cooperative is organized elsewhere, it will incur additional expenses for registering to conduct business in Georgia and for complying with regulatory requirements and paying company fees in both Georgia and the other state.  Organizing the cooperative elsewhere will also involve the time and expense involved in research the other state’s state-specific requirements, including licensing and taxation, and in performing the related administrative tasks.

Organizing a Georgia-based cooperative in another state could also complicate the cooperative’s attempt to issue securities to raise capital.  When small businesses such as new cooperatives want to issue preferred stock, promissory notes or other instruments to raise capital, they typically rely on one of the intrastate exemptions that require all such securities to be sold only to persons in the state in which the business is organized.  Although the recent revisions to Georgia’s crowdfunding exemption may relax this restriction with respect to some out-of-state companies, organizing a Georgia-based cooperative out of Georgia will at a minimum require additional research when issuing securities.

On the other hand, the planned cooperative may have special circumstances that warrant organizing the cooperative in another state.  For example, the cooperative may want to organize as a limited cooperative association using another state’s limited cooperative association statute.  (Limited cooperative associations are useful for cooperatives that want to raise capital from non-patrons and give some governance rights to such patrons).  The cooperative may be performing business, selling products or hiring employees in multiple states, in which case a decision can be made as to which state’s statutory scheme is most favorable.  Cooperatives may also want to take advantage of cooperative statutes in other states that expressly provide for grocery cooperatives, multi-stakeholder cooperatives and worker cooperatives and that may provide special protections or rights for the cooperative and its directors and members.

In summary, while it will ordinarily make the most sense for a new cooperative based in Georgia to legally organize in Georgia, there may be special circumstances that warrant organizing elsewhere.  However, deciding to organize in another state, the cooperative’s organizing group should carefully consider the financial, legal and administrative consequences that will result from this decision.

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Roland has been a member of the Georgia Bar since 1994. Roland’s practice includes representing electric cooperatives and related entities in corporate, finance and regulatory matters, negotiating and drafting contracts, including construction contracts, and handling complex business transactions and commercial litigation. Find out more at www.ahclaw.com or by email: hall@ahclaw.com.