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- 1. Convening on Co-‐operatives NOFA-‐VT Winter Conference, Burlington, VT Sunday, 16th Feb 2014
- 2. Agenda 1. Welcome & Introduc1ons • Roger Noonan, President & Erbin Crowell, Vice President • Diane Bothfield, VT Deputy Secretary of Agriculture 3. Challenges & Opportuni1es • Discussion 4. NEFU’s Co-‐opera1ve Legacy — Current & Future Work • NEFU Board & Staff 5. Next Steps • Roger Noonan NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2. Opportuni1es in the Regional Food System & Economy
- 3. PrioriOes for the Day • Make connecOons • Explore opportuniOes and challenges • Share NEFU’s policy & development prioriOes • Invite your ideas and parOcipaOon as we move forward NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Why a Convening on Co-‐ops?
- 4. • Officially known as the “Farmers' EducaOonal and CooperaOve Union of America” (1902) • Key role in passage of Capper Volstead Act in 1922 & CooperaOve MarkeOng Act of 1926 • Founded Farmers Union Central Exchange in 1931; merged with Harvest States Co-‐ operaOve to form CHS: • Largest US-‐based co-‐op by revenue (2012) • 69th on Fortune 500 list by revenue (2012) • 25th largest convenience store chain in US NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 The Farmers Union & Co-‐ops
- 5. Democracy, sustainability, relocaliza1on • 2012: InternaOonal Year of Co-‐operaOves • 2013: Blueprint for a Co-‐operaOve Decade • 2014: InternaOonal Year of Family Farming NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 1. Our Opportunity
- 6. What’s going on? • Global economy in disarray • Poverty, inequality, unemployment • UN Millennium Development Goals at risk • Focus on local & regional food systems • Food security becoming a major concern • For family producers and consumers NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Our Opportunity
- 7. Co-‐opera1ves seen as a solu1on • Community ownership & democraOc control • Focus on service, meeOng needs before profit • Develop local skills & assets • Ability to assemble limited resources • Anchor community wealth locally • Create economic efficiencies for small producers while retaining local ownership • More sustainable and resilient NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Our Opportunity
- 8. 2011 -‐ Farmer, rancher and fishery co-‐ops posted record sales, surpassing the previous record sales year of 2008 by $10 billion while besOng the old income record by $500 million. Co-‐op employment levels remained strong, with co-‐operaOves employing 184,000 full-‐Ome, part-‐Ome and seasonal workers, up slightly from 2010. • "These new co-‐opera/ve sales and income records for 2011 underscore the strength and produc/vity of the na/on's farmer-‐ and rancher-‐owned coopera/ves, and the vital role they play in the na/on's economy," said Undersecretary for Rural Development Dallas Tonsager. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Growth in the Midst of Recession
- 9. 2012 -‐ U.S. farmer, rancher and fishery co-‐ops set records for sales, income and assets in 2012. Sales nearly $235 billion surpassed the 2011 record by $18 billion, an 8.3 percent gain. • "Agricultural co-‐opera/ves are a driving force in the na/on's thriving farm economy. Because they are farmer-‐owned and operated businesses, the sales dollars and income generated are much more likely to be returned and spent in rural areas and communi/es," Vilsack said. "Ag co-‐opera/ves are also vital to the rural economy because they support 185,000 full-‐ and part-‐/me jobs, and are oKen the major employer in many rural towns." NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Growth in the Midst of Recession
- 10. • Agricultural Co-‐ops • Fishery Co-‐ops • Producer Credit • Food Co-‐ops • Worker Co-‐ops • ArOsan Co-‐ops • Credit Unions • Housing Co-‐ops • Childcare Co-‐ops • UOlity Co-‐ops • Health & Insurance • Etc. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 A Flexible Business Model
- 11. 312 F A R M E R S (1,817 Nationally) • Organic Valley Co-‐op Member Farmers ConnecOcut 1 Maine 29 Massachuseks 2 New Hampshire 9 New York 134 Vermont 137 35 FOOD CO-OPS (90,000 Members) Food Co-‐ops & Farmer Co-‐ops: Working together for a more just, sustainable and resilient regional food system. Neighboring Food Co-‐op Associa1on Member Food Co-‐ops & Start-‐Ups www.nfca.coop // www.organicvalley.coop Map Updated 9/2013
- 12. • 35 food co-‐ops and start-‐ups • 90,000+ member-‐ owners • 7,000+ new member-‐ owners • 1,480+ employees • Together, VT members are in top 25 employers in state • $215 million in annual revenue • $30+ million in local purchases NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Neighboring Food Co-‐op Association (2012)
- 13. New England & New York • 8,860 co-‐ops • 9.5 million members • Employ 55,000 people • $2 billion in wages • $100 billion in assets • $14 billion in revenue hkp://reic.uwcc.wisc.edu/ hkp://nfca.coop/co-‐opeconomy NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Scale at the Regional Level
- 14. A Model with Scale • I billion co-‐op member worldwide • 30,000 co-‐ops in the US • Vermont (UW Study, 2009) • 129 co-‐ops and mutuals • 348,000 memberships • $1 billion in revenue • 1,450 employees NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 • More than direct investors in corporaOons
- 15. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 A Model with Resilience
- 16. • Old Creamery Co-‐op (MA) – Rural grocery store converted to community co-‐op. • Stone Soup CSA (MA) – Farm converted to worker co-‐op. • Real Pickles (MA) – Sole proprietorship converted to worker co-‐op. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 A Tool for Retaining Economic Infrastructure
- 17. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 United Nations International Year of Co-operatives www.social.un.org/coopsyear
- 18. Co-‐ops “in their various forms, promote the fullest possible parOcipaOon in the economic and social development of all people, including women, youth, older persons, persons with disabiliOes and indigenous peoples, are becoming a major factor of economic and social development and contribute to the eradicaOon of poverty.” United NaOons ResoluOon 64/136 (2010) NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2012: The United Nations International Year of Co-‐ops
- 19. Contribu1on of Co-‐opera1ve Enterprise to • Poverty ReducOon • Employment GeneraOon • Social IntegraOon • Fairness & GlobalizaOon • Conflict ResoluOon • Food Security for Producers & Consumers NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2012: The United Nations International Year of Co-‐ops
- 20. Goals • Increase public awareness • Promote formaOon and growth • Encourage governments to establish policies, laws and regulaOons conducive to the formaOon, growth and stability of co-‐operaOves NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2012: The United Nations International Year of Co-‐ops
- 21. INTERNATIONAL CO-OPERATIVE ALLIANCE BLUEPRINT FOR A CO-OPERATIVE DECADE NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 JANUARY 2013 2013: International Co-operative Alliance Blueprint hkp://ica.coop/en/blueprint
- 22. Global Challenges • Environmental degradaOon • Unstable financial sector • Global governance gap • Disenfranchised younger generaOon • Loss of trust in poliOcal & economic organizaOons NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 International Co-‐operative Alliance (ICA)
- 23. 2013: ICA Blueprint for a Co-‐operative Decade INTERNATIONAL CO-OPERATIVE ALLIANCE BLUEPRINT FOR A CO-OPERATIVE DECADE JANUARY 2013 NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Co-‐ops are a Be]er Business Model • ParOcipaOon through ownership & governance, • Economic, social & environmental sustainability, • Place people before profit.
- 24. 2013: ICA Blueprint for a Co-‐operative Decade INTERNATIONAL CO-OPERATIVE ALLIANCE BLUEPRINT FOR A CO-OPERATIVE DECADE JANUARY 2013 NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 By 2020, co-‐opera1ve enterprise will be… • The leader in economic, social and environmental sustainability, • The business model preferred by people around the world, • The fastest growing form of enterprise.
- 25. Strategy • Elevate parOcipaOon to a new level • Co-‐operaOves as builders of sustainability • Build the co-‐operaOve message & idenOty • Legal frameworks for co-‐operaOve growth • Reliable co-‐operaOve capital that also guarantees member control and reinforces the co-‐op idenOty NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2013: ICA Blueprint for a Co-‐operative Decade
- 26. 2013: ICA Blueprint for a Co-‐operative Decade Member ParOcipaOon NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Sustainable Business Co-‐opera1ve Iden1ty Co-‐op Capital Legal Framework
- 27. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2014: United Nations International Year of Family Farming hkp://www.fao.org/family-‐farming-‐2014/en/
- 28. “The 2014 InternaOonal Year of Family Farming (IYFF) aims to raise the profile of family farming and smallholder farming by focusing world akenOon on its significant role in eradicaOng hunger and poverty, providing food security and nutriOon, improving livelihoods, managing natural resources, protecOng the environment, and achieving sustainable development, in parOcular in rural areas.” NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2014: United Nations International Year of Family Farming
- 29. Objec1ves • Policies conducive to family farming • Increase knowledge, communicaOon, public awareness • Understand needs, potenOal, constraints, support • Synergies for sustainability -‐ parOcularly with UN Year of Co-‐ops NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2014: United Nation International Year of Family Farming
- 30. Linkage with Year of Co-‐ops • Co-‐ops strengthen bargaining power and resource sharing that lead to food security and poverty reducOon for millions of small producers… • Offer men and women smallholders market opportuniOes, and services such as training in natural resource mgmt, and access to informaOon, technologies, innovaOons & extension services. • “The importance of agricultural co-‐operaOves in improving the lives of millions of smallholder farmers and their families cannot be overstated.” NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 2014: United Nations International Year of Family Farming
- 31. • How can we take advantage of this opportunity to grow co-‐operaOve enterprises? • Where are the key opportuni1es to use the co-‐op model in the regional economy? • What are the obstacles to growth and development? • What can NEFU do to support co-‐op development and cross sector collaboraOon among co-‐ops? • Your quesOons and feedback. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Key Questions for Today
- 32. New England Farmers Union Opportunities in the Regional Food System & Economy February 16, 2014 Burlington, VT
- 33. Opportunities in the Regional Food System & Economy • Regional Strengths • Regional Weaknesses • Regional Opportunities • Regional Threats
- 34. Opportunities in the Regional Food System & Economy • Regional Strengths ▫ Conservation and protection of farmland ▫ Consuming population- southern New England ▫ Open Farmland – concentration northern New England ▫ Adequate rainfall and good soils ▫ Transportation corridors between North and South ▫ Farmers – men and women, young and old ▫ Value Added Agriculture ▫ Connection of farms to institutions – schools, hospitals, colleges and consumers
- 35. Opportunities in the Regional Food System & Economy • Regional Weaknesses ▫ 10 months of winter and 2 months of hard sledding – the weather and growing season ▫ Light food processing – vegetables especially ▫ Slaughter and processing capacity ▫ One way hauling – no back hauling – cost ▫ Feed costs and availability ▫ Farm profitability – especially dairy ▫ Small-farm production aggregation
- 36. Opportunities in the Regional Food System & Economy • Regional Threats ▫ Loss of farmland - Urban development pressure and large rural residential parcels ▫ Right to farm issues ▫ Laws/ordinances restricting agricultural activity as a result of residential/commercial pressure. ▫ Food Safety Concerns – FSMA ▫ Importation of food from other regions ▫ Global warming – pests and changing maple sugaring season ▫ Exclusive language around local vs. regional
- 37. Opportunities in the Regional Food System & Economy • Regional Opportunities ▫ Connection of southern population centers with northern production areas – how to benefit all Role of Harvest New England Farm to Institution New England market development ▫ Continue and increase direct marketing opportunities Boston Public Market, Connecticut Market Space, NYC market New CSA outlets – regional CSA’s?, State Employee CSA’s Continue work with Farmers Markets and income challenged population
- 38. Opportunities in the Regional Food System & Economy • Regional Opportunities ▫ Ag and Culinary tourism opportunities – see it made, restaurants and visitors to all our states DigIn VT Cheese maps Wine Trails ▫ Renewable Energy on farms – reduce costs, shared benefits and co-op ventures with towns Methane Digestion – off farm food wastes, wind, solar Heat as well as electricity Connect different types of farms – heat from methane digester for greenhouses – dairy and produce on one farm All season growing opportunities
- 39. Opportunities in the Regional Food System & Economy • How do Cooperative fit in by sector? • Dairy ▫ Cooperatives exist but are they the right type New Law in Vermont and other states allow for investment in Co-ops by non-members but allow farmers members to remain in control ▫ Support and market value added as well as conventional dairy products from the region Smaller value added processors can they aggregate and distribute together through a cooperative
- 40. Opportunities in the Regional Food System & Economy • How do Cooperative fit in by sector? • Meat ▫ Increase slaughter and processing capacity – regionally Potential ownership model of cooperative – owners move own animals through facility ▫ How to match herd, flock and swine production on farm to meet growing demand – not too much or too little Can cooperatives of growers work with private owned slaughter facilities and or cooperative slaughter facilities – vertical integration? ▫ Creative partnerships between growers and buyers
- 41. Opportunities in the Regional Food System & Economy • Produce – fruit and vegetable ▫ Continue growth in Farm to School and Farm to Institution locally and regionally Alignment of product specifications within sectors and across region ▫ Direct Markets sales one arena Expand farmer sales beyond direct market cooperative marketing ▫ Food hubs – many definitions but are these acting as marketing co-ops Is this a concern? Aggregation and distribution roles ▫ Light processing – location and number needed – improve year round market to schools and institutions Grower remain independent but form a co-op to have light processing facilities ▫ Food Safety Modernization Act – can we work together as a region? Cooperative model could provide staff to assist farms in meeting FSMA requirements Hire staff to work with each farm to implement FSMA
- 42. Opportunities in the Regional Food System & Economy • Opportunity to expand producer-owned cooperatives? ▫ Deep Root Organic Cooperative as a transferable model
- 43. Opportunities in the Regional Food System & Economy • Importance of this meeting ▫ Continue and enhance the discussion of cooperatives in the changing world of agriculture ▫ Profitability and how to enhance farmers access to markets, processing and distribution • Overview ▫ Opportunities for strengthening the regions farm economy are there ▫ How do we advance these opportunities?
- 44. Discussion • QuesOons & Feedback • What are some of the core challenges to growing exisOng co-‐ops and to starOng new ones? • What are the key opportuniOes for applying the model to an evolving food system? • What role can NEFU play in addressing these quesOons moving forward? NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 3. Challenges & Opportunities
- 45. • Officially known as the “Farmers' EducaOonal and CooperaOve Union of America” (1902) • Key role in passage of Capper Volstead Act in 1922 & CooperaOve MarkeOng Act of 1926 • Founded Farmers Union Central Exchange in 1931; merged with Harvest States Co-‐ operaOve to form CHS: • Largest US-‐based co-‐op by revenue (2012) • 69th on Fortune 500 list by revenue (2012) • 25th largest convenience store chain in US NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 4. Farmers Union Co-‐operative Legacy
- 46. • NEFU Policy Statement • Recruitment of co-‐op members • Establishment of a Commikee on Co-‐ operaOve Development to assess needs and prioriOes of members • Grant opportuniOes that address opportuniOes in the food system, our policy statement and the prioriOes of members NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 NEFU Activities
- 47. • Needs to be more responsive to needs and interests of exisOng co-‐ops • Need for reliable technical support • Focus tends to be on development of new co-‐ops rather than exisOng enterprises • Basic principles of co-‐op enterprise not well understood by gov’ts, developers, lawyers, etc. • State statutes vary widely and some proposals for change threaten co-‐operaOve idenOty • Development relies too heavily on outside consultants rather than the experOse and experience of co-‐op pracOOoners NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 The State of Co-‐operative Development in New England
- 48. • Defend the unique character of co-‐operaOve enterprise • OpportuniOes for cross sector collaboraOon that maximize impact in the regional food system • Support development of exisOng co-‐ops before the development of new co-‐ops, and avoid compeOOon with exisOng co-‐ops • Facilitate the work, prioriOes and experOse of member co-‐ops in development • Educate public & decision makers on the impact and potenOal of co-‐ops in the food system NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 NEFU Co-‐operative Priorities
- 49. • High Meadows FoundaOon to organize a “Convening of Co-‐ops,” including farmers, co-‐ op members, co-‐op staff and other stakeholders to discuss the role of co-‐ops in enhancing Vermont’s farm and food system. • USDA Rural Business Enterprise Grant “to help producers scale up producOon and markeOng of regionally produced food through co-‐operaOve business ventures” in W. Massachuseks NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Grant Supported Projects
- 50. • MERCK FoundaOon “to scale up producOon and markeOng of regionally produced food by educaOng farmers and fishermen about co-‐operaOve business models, providing them with technical assistance, and eliminaOng legal barriers that new farm and fishing co-‐operaOves face…” • CompilaOon and analysis of New England co-‐operaOve statutes NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Grant Supported Projects
- 51. USDA Value Added Producer Grant to Deep Root Organic Co-‐ op to explore processing and regional distribuOon in collaboraOon with Neighboring Food Co-‐ op AssociaOon (NFCA). NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Grant Supported Projects
- 52. Jane's Trust grant to support Healthy Food Access work of the NFCA addressing affordability of healthy, local food and access to co-‐operaOve membership for people with limited incomes. NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Grant Supported Projects
- 53. Producer Co-‐op Principles • One member, one vote • ConOnuing educaOon • Open membership • Patronage refund • CompeOOve pricing • Limited return on investment • ConOnuous expansion • PoliOcal & religious neutrality NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Policy Priorities
- 54. • Promote the co-‐operaOve idenOty • Revitalize USDA co-‐op services • PromoOon of co-‐operaOve educaOon • Defense of Capper-‐Volstead NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 NEFU Supports
- 55. • Joint ventures with mulOnaOonal corporaOons • Outsourcing of product to non-‐members • Defense fund schemes that avoid full equity payment to member patrons • ModificaOon of state laws that undermines core principles of member ownership, control, financing, and distribuOon of patronage based on use • E.g., Limited Co-‐operaOve AssociaOon statutes NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 NEFU Opposes
- 56. • Promote the co-‐operaOve idenOty • Revitalize USDA co-‐op services • PromoOon of co-‐operaOve educaOon • Defense of Capper-‐Volstead NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 Policy Priorities
- 57. • Where do we go from here? • How can we align NEFU’s acOviOes with opportuniOes in the food system? • How can we best collaborate with partners to advance our vision & prioriOes? • How would you like to be involved? NEFU Convening on Co-‐operaOves, NOFA-‐VT 16th Feb 2014 5. Next Steps
- 58. Thank-‐you. New England Farmers Union www.newenglandfarmersunion.org