At meeting with senior White House officials, a call for more co-op stories

In a visit to the White House, members of NCBA CLUSA’s Board of Directors made the case that co-ops are bipartisan solutions to some of America’s toughest challenges.

In Morganton, West Virginia—a 45-minute drive from Asheville—an innovation hub called The Industrial Commons is rebuilding a diverse working class based on locally-rooted wealth. Partnering with textile cooperatives, other employee-owned businesses and local research institutions, The Industrial Commons is leading the broader textile industry’s embrace of recycled and repurposed materials while providing high quality, well-paying jobs and kickstarting American manufacturing in the region.

Thanks to advocacy efforts by NCBA CLUSA and the U.S. Federation of Worker Cooperatives (USFWC) that ensured co-ops were eligible for the Biden Administration’s CHIPS and Science Act, the Industrial Commons won a grant to drive advances in smart textiles, wearable technology and other innovations.

“Here they are in a rural economy, a red district in a purple state, and they have this amazing success story that illustrates the extent to which cooperatives are incredibly bipartisan,” USFWC Executive Director Esteban Kelly said during a meeting at the White House earlier this month. “Co-ops are one of the few things you can advance without it being a third rail issue for a lot of people.”

A call for co-op stories

Kelly shared The Industrial Commons’ story during a May 7 meeting between members of NCBA CLUSA’s Board of Directors and senior White House officials on how the cooperative ecosystem can engage with and support the Biden Administration’s priorities.

From left: Esteban Kelly, chair of NCBA CLUSA’s Board of Directors; Doug O’Brien, president and CEO of NCBA CLUSA; Will McIntee, Director of Strategic Engagement in the Office of Public Engagement; and Kelliann Blazek, Special Assistant to the President for Rural and Ag Policy in the Domestic Policy Council.

Stories like this one are exactly what the Administration wants to hear, said Kelliann Blazek, Special Assistant to the President for Rural and Ag Policy in the Domestic Policy Council; and Will McIntee, Director of Strategic Engagement in the Office of Public Engagement. Blazek and McIntee were joined by Laurie Schoeman, Senior Policy Advisor for Housing and Urban Policy in the Domestic Policy Council; and Kate Balcerzak, Director of Private Sector Engagemen in the Office of Public Engagement.

“Our focus right now is lifting up the success stories, but also lifting up opportunities for communities to access resources from the federal government,” McIntee said. “We want to make sure that communities that have historically been left out of these opportunities are really in the driver’s seat going forward.”

In a conversation that illustrated both the potential and existing impact of the cooperative business model and spanned sectors from finance and food to housing and worker co-ops, NCBA CLUSA board members raised the co-op flag.

Christina Jennings, Executive Director of Shared Capital Cooperative, a national CDFI loan fund that connects co-ops and capital to build economic democracy, shared how her co-op empowered a group of immigrant and refugee business owners. Against a backdrop of absentee landlords and investor owners in commercial real estate, these women embodied a growing desire for community ownership of real estate. “Just this past year, we provided a loan together with a CDFI to help them purchase a strip mall in suburban Minneapolis-St Paul where they live. They also got some state funding—resources that were passed on by the federal government—that were critical in making that happen,” Jennings said.

Opportunities and challenges on the horizon

There are similar opportunities to leverage existing federal funding—or advocate for more—in other sectors. NCBA CLUSA member ROC USA® is leading efforts to transfer ownership of manufactured home communities to their residents. “That sector is one of the most notorious for private equity coming in and just extracting whatever value they can,” said NCBA CLUSA president and CEO Doug O’Brien, adding that ROC USA recently received a HUD grant to accelerate their work.

In the retail food and agriculture sector, grocery co-op impact is growing. “Because they are rooted in their communities, food co-ops are economic engines for local economies,” said Erbin Crowell, Executive Director of the Neighboring Food Co-op Association. On average, local products make up 25 percent of sales at member co-ops, compared to just 2-5 percent at grocery chains, he added. Still, food co-ops face challenges complying with the requirements of SNAP, WIC and other federally funded nutrition programs. “But by working together, they’ve created Healthy Food Access programs that provide discounts to people who qualify for food assistance,” Crowell said.

John Holdsclaw IV, president and CEO of Rochdale Capital (center), shares the story of Fredericksburg Food Co-op, the first co-op in the U.S. financed with 7(a) loan from the Small Business Administration. The SBA’s personal loan guarantee requirement blocks most co-ops from accessing funding.

LaDonna Sanders Redmond, a DEI consultant with Columinate with deep experience in the retail food and agriculture industry, amplified the need for food co-ops to recoup the discounts they offer customers. “With the market share being as tight as it is, co-ops can’t really compete with Whole Foods or major grocery chains. But the advantage they do have is they can sink deeply into a community and impact that community in ways that don’t cause gentrification,” Sanders Redmond said. And that’s something worth investing in.

It’s a challenge, McIntee agreed. “How do you build a food system that provide healthy, nutritious food to people regardless of their zip code while also bringing wealth to those who grow and produce that food and provide opportunities—especially for younger folks who are entering the agricultural field?” All of the White House officials reiterated that closer partnership between co-op advocates and the Biden Administration can help surface solutions moving forward.

Sylandi Brown, Communications Manager for the U.S. Overseas Cooperative Development Council, shared remarks informed by her work with a rural electric cooperative serving 4,800 members in central Georgia. There, access to broadband remains a huge challenge; students often drive to distant parking lots with insecure public Wi-Fi to do their homework, she said. Some rural electric cooperatives are told they need to wait for more federal funding for broadband; meanwhile, “our communities can’t wait,” Brown said.

At the same time, the cooperative business model is resonating with younger generations, she added, leaving White House officials with a challenge: “What we see is that co-op businesses are really attracting this new generation in a unique way. How can we ensure that [co-op] initiatives not only take root, but also flourish in the diverse and dynamic environment of our rural communities?”

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