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Coop Types

A co-op is a business controlled by its members. Members are user-owners; they patronize the business but also own its earnings and assets. They control the co-op’s day-to-day operations, its finances, and its mission. Cooperatives offer many advantages that other businesses cannot. Saving money for their patrons while providing the best quality products at the lowest cost allows for greater economic democracy and self-determination. Since they operate for the benefit of their user-owners, co-ops can easily adapt to reflect the diverse and changing needs of their patrons. The cooperative model can be adapted to a variety of businesses. There are food co-ops, housing co-ops, rural electric co-ops, and even financial co-ops (credit unions). Despite the diversity of goals and traditions in the co-op sector, all co-ops follow certain guiding principles.

Resources

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Comparison of Housing Cooperatives to Condominiums

Due to select similarities, the chart below is a simplified display comparing the housing cooperative and condominium. While both are considered common interest communities, the internal structures are completely separate.

Basics of Consensus

The scene is almost good enough for a commercial. The atmosphere is tense, the discussion is strained, and the process is confusing. Everyone is arguing for their own interests and no one is listening. A few loud and aggressive people are dominating the floor and saying the same point over and over again in an attempt to win over a few more members to their opinions.

Differences Between Cooperatives and Other Enterprises

When you start a business, one of the first things to do is decide how the company will be legally structured. A business’ structure determines who is liable for the company’s debt and its actions. One of the simplest business structures is a sole proprietorship, which is usually a company run by a single person or by a married couple. Sole proprietors have full liability for their company’s debts, meaning that a person could lose their personal assets if the company has difficulty.

Different Types of Co-ops

The cooperative model can be adapted to a variety of businesses. There are food co-ops, housing co-ops, rural electric co-ops, and even financial co-ops (credit unions). Despite the diversity of goals and traditions in the co-op sector, all co-ops follow certain guiding principles.

Cooperatives : A Housing Alternative For Rural America

In a housing cooperative, people join to form a cooperative corporation that owns the buildings in which they live. Purchasing a share in the cooperative entitles each member to lease and occupy a dwelling unit from the cooperative and to participate in its operation. Each member pays a share of the cooperative’s monthly expenses. Housing cooperatives are democratically controlled, meaning that each member has one vote in deciding the affairs of the cooperative

Limited Cooperative Association Statutes

Traditionally, a business organized on a cooperative basis subordinates the interests of the capital investor to those of the business user, or patron. Cooperative control is in the hands of its memberpatrons, and returns on investment capital are limited. Member-patrons are the primary source of equity capital, and net earnings are allocated on the basis of patronage instead of investment.

Counting Limited-Equity Co-ops, Research

This previous research has been very useful as a guide for our current work in more precisely counting the number of housing co-ops that remain limited-equity today. What we have found is that the difference between the limited-equity co-op units accounted for in previous research and the units found in our current research is attributed to three factors.

Types Of Coops

Cooperatives span many different activities and services from childcare to transportation, farming to solar energy, financial services to purchasing school supplies. Cooperatives are owned by their members, which could be consumers, producers/farmers, workers, businesses or organizations, municipalities, and other coops.

Stock v. Nonstock Cooperatives

The advantage of incorporating as a stock cooperative is the flexibility that the structure provides for raising equity capital now or at a later date. There may be additional costs associated with incorporating as a stock cooperative in Wisconsin ($1.25 for every $1000 of capital stock), but these fees are relatively minimal.

Limited Cooperative Association Statutes

Since 2001, new cooperative laws have been adopted in five states -- Wyoming, Tennessee, Iowa, Minnesota, and Wisconsin -- and introduced in the Nebraska state legislature. These laws do not replace existing cooperative statutes. They provide for the establishment of a new type of business entity, the limited cooperative association (LCA), which has characteristics of both the traditional cooperative and the limited liability company (LLC). Because the LCA can be structured in ways that contradict fundamental principles under which cooperatives traditionally have operated, there is concern that these new laws will subvert or dilute the cooperative business model.

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