02-01-17 Community Relations - Laserfiche WebLink

Home Browse Search

are made. A dominant business model currently being utilized in society is the investor-owned corporation. Though that is not inherently a bad thing, sometimes the needs and priorities that face the investors may be different or even conflict with the needs and priorities of the communities in which those businesses are located, the workers or even the consumers of that business. So broad-based ownership structure helps disperse the concentration of needs and priorities to have other types be considered. Broad-based ownership means more people's priorities and needs are being met. She then played a video in the presentation that can be found on the South Bend Common Council's website. In the video,the concepts of inequality and community wealth building were addressed by focusing on a new system of economic cooperatives. Ms. Bonnano stated Community Wealth Building is a systems approach to economic development with the goal being to create an inclusive economy built on local and broad-based ownership. This is achieved by tapping large sources of demand, fostering enterprises rooted in the community, all around trying to create a cumulative system where communities thrive and families enjoy greater economic stability. She noted that CWB is not an oppositional to the traditional way of economic development, rather it is more supplemental and complimentary. She went on to describe the importance of ownership by way of capturing the flow of all the economic benefits and harnessing the power of decision-making. A slide brought up in the presentation showed the Continuum of Wealth Building Strategies. This continuum showed the importance of micro-enterprise for individual wealth building. Whatever the importance may be, there are still those that are not able to participate in entrepreneurship for it takes a tremendous amount of assets, resources, capital and connections. CWB focuses on other ways for individuals to acquire entrepreneurship without having access to those aforementioned variables. For example, raising a pool of capital and having twenty (20) or thirty (30) employee-owners spreads the risk, necessary investment but also spreads the overall number of people benefited by the profitability. Ms. Bonnano transitioned by explaining a few different types and models of broad-based ownership. The first model described was a Community Land Trust. A Community Land Trust (CLT) is when a non-profit or some other community-based organization gets together, raises a pool of capital, buys some land and uses the land for housing development, business development or another purpose toward the community's specific problem they intend to address. Another broad-based ownership model is public ownership. These are municipal enterprises, owned by residents and taxpayers, are for-profit businesses that are set up to provide goods and services and operate like regular companies, but their profits go back into the public treasury. This allows the community to have revenue generated and also allows the company to offer lower rates, competing with already existing traditional companies. Employee-owned businesses is another broad-ownership model of business. Employee-owned businesses include workers cooperatives and are, by definition, owned by the people that work for them. Another employee-owned business model is an ESOP (Employee Stock Ownership Plan.) Worker Cooperatives and ESOPs are the two (2) most common employee-owned business structures. The ESOP is actually a trust, it is set up as a tax-advantage retirement plan for employees. The trust structure owns the business to varying percentage ratios (twenty percent(20%),thirty percent(30%), or otherwise.) Publix Supermarket is an example of an ESOP. A worker cooperative is a more direct ownership where all the controlling stock and voting stock is owned 3