Worker-Owners Cheer Creation of $1.2 Million Co-op Development Fund in NYC

Rebecca Burns

Worker-owners rally in New York City this May in support of a $1.2 million fund for cooperative development. (Photo via Ecomundo Cleaning cooperative).

In a vic­to­ry for new econ­o­my advo­cates, the New York City Coun­cil passed a bud­get last week that will cre­ate a $1.2 mil­lion fund for the growth of work­er-owned coop­er­a­tive busi­ness­es. The invest­ment is the largest a munic­i­pal gov­ern­ment in the U.S. has ever made in the sec­tor, break­ing new ground for the coop­er­a­tive devel­op­ment movement.

Melis­sa Hoover, exec­u­tive direc­tor of the U.S. Fed­er­a­tion of Work­er Coop­er­a­tives and the Democ­ra­cy at Work Insti­tute, hails the New York City Council’s move as his­toric.” We have seen bits and pieces here and there, but New York City is the first place to make an invest­ment at that lev­el,” she says.

New York’s coop­er­a­tive devel­op­ment fund was the brain­child of a coali­tion of com­mu­ni­ty groups — includ­ing the Fed­er­a­tion of Protes­tant Wel­fare Agen­cies, the New York City Net­work of Work­er Coop­er­a­tives, the Democ­ra­cy at Work Insti­tute, Make the Road New York and oth­ers — that came togeth­er to stage a series of pub­lic forums and advo­ca­cy days to secure wide­spread sup­port for the ini­tia­tive on the City Coun­cil. Over the next year, the fund will pro­vide finan­cial and tech­ni­cal assis­tance in the planned launch of 28 new coop­er­a­tives and the con­tin­ued growth of 20 exist­ing coop­er­a­tives, sup­port­ing the cre­ation of 234 jobs in total.

While this may just be a drop in the buck­et when it comes to the city’s $75 bil­lion total bud­get, coop­er­a­tive advo­cates are hop­ing New York’s exam­ple can help turn the tide in favor of alter­na­tive strate­gies for urban development.

We’d like to get to a tip­ping point where [coop­er­a­tives] real­ly have a mea­sur­able impact on the local econ­o­my,” says Hilary Abell, a San Fran­cis­co-based co-op devel­op­ment con­sul­tant who co-found­ed the group Project Equi­ty. She notes that while inter­est in coop­er­a­tives has surged, there are still few­er than 5,000 work­er-own­ers” nation­wide. Nev­er­the­less, the mod­el of work­er-owned coop­er­a­tives has cap­tured the imag­i­na­tions of many low-income com­mu­ni­ties of col­or hit hard­est by the Great Reces­sion, she says, cre­at­ing a win­dow of oppor­tu­ni­ty to take this to the next level.”

Last month, Abell released a report called Work­er Coop­er­a­tives: Path­ways to Scale,” which out­lines a set of strate­gies to grow the coop­er­a­tive move­ment nation­wide. While there are sev­er­al promis­ing fed­er­al pol­i­cy ini­tia­tives under­way — Sen­a­tor Bernie Sanders (I‑Vt.), for exam­ple, has intro­duced a bill that would cre­ate an Office of Employ­ee Own­er­ship and Par­tic­i­pa­tion with­in the U.S. Depart­ment of Labor, as well as anoth­er that would estab­lish a U.S. Employ­ee Own­er­ship Bank — Abell believes that advo­ca­cy for coop­er­a­tives may have the great­est momen­tum at the state and munic­i­pal levels.”

Across the coun­try, sim­i­lar local eco­nom­ic jus­tice coali­tions have been seek­ing to per­suade munic­i­pal gov­ern­ments and local insti­tu­tions to throw their resources behind the devel­op­ment of work­er-owned co-ops. It’s those resources, many advo­cates believe, that could take co-ops from a niche move­ment to a broad-based strat­e­gy for cre­at­ing liv­ing-wage jobs and putting eco­nom­ic pow­er in the hands of workers. 

To that end, Abell hopes to see more cities fol­low in New York’s foot­steps. In the Bay Area, she tells Work­ing In These Times, local orga­niz­ers are cur­rent­ly reach­ing out to local offi­cials for sup­port in scal­ing up work­er-owned coop­er­a­tives to the point that they con­sti­tute five to 10 per­cent of the local econ­o­my. The coali­tion is par­tic­u­lar­ly focused on cre­at­ing jobs for work­ers of col­or in the low-income areas of the East Bay , as past expe­ri­ences have shown that work­er-owned co-ops can be par­tic­u­lar­ly effec­tive in redress­ing racial inequities in the job mar­ket. For exam­ple, Women’s Action to Gain Eco­nom­ic Secu­ri­ty (WAGES), a net­work of near­ly 100 work­er-owned clean­ing coop­er­a­tives in Oak­land, has increased mem­bers’ incomes by more than 50 percent.

Oth­er hotbeds of co-op devel­op­ment include Rich­mond, Cal­i­for­nia, where the city has hired its own coop­er­a­tive devel­op­er and is launch­ing a loan fund under the lead­er­ship of Green Par­ty May­or Gayle McLaugh­lin. In Cleve­land, Ohio, the city’s eco­nom­ic devel­op­ment depart­ment has worked close­ly with the Ever­green Coop­er­a­tives, a net­work of work­er-owned green clean­ing, farm­ing and con­struc­tion busi­ness­es; local hos­pi­tals and uni­ver­si­ties have also thrown their pur­chas­ing pow­er behind work­er-owned busi­ness­es. And as In These Times has report­ed pre­vi­ous­ly, sev­er­al unions have made a for­ay into the co-op busi­ness, com­bin­ing place-based growth with a focus on lever­ag­ing changes across indus­tries such as homecare.

Instead of sim­ply appeal­ing to local lead­ers for sup­port, some activists have sought to build both polit­i­cal and eco­nom­ic pow­er by build­ing elec­toral cam­paigns around the issue of coop­er­a­tive devel­op­ment. No city had secured greater local sup­port for co-ops than Jack­son, Miss., a major­i­ty African-Amer­i­can munic­i­pal­i­ty where human rights attor­ney and long­time black rad­i­cal activist Chok­we Lumum­ba was elect­ed may­or last year on a plat­form that includ­ed the use of pub­lic spend­ing to pro­mote coop­er­a­tive enter­pris­es. But fol­low­ing Lumumba’s sud­den death in Feb­ru­ary, the move­ment that brought him to office has been left strug­gling to imple­ment the vision it had forged.

Local activists say new May­or Tony Yarber has been tepid in his sup­port for the coop­er­a­tive devel­op­ment plan devel­oped by Lumumba’s admin­is­tra­tion, leav­ing them uncer­tain as to whether they can count, for exam­ple, on city con­tracts being award­ed to local work­er-owned busi­ness­es. Accord­ing to bran­don king, a mem­ber of the group Coop­er­a­tion Jack­son who also worked on the Lumum­ba cam­paign, access to such con­tracts would have been a huge boon for nascent con­struc­tion and waste-man­age­ment coop­er­a­tives, as Lumumba’s cam­paign had esti­mat­ed that the city would need to spend $1.2 bil­lion over the next 10 to 15 years on infra­struc­tur­al upgrades and repairs. What often hap­pens, says king, is that con­tracts go to com­pa­nies locat­ed in wealth­i­er and major­i­ty-white sub­urbs out­side of Jack­son, with the result that peo­ple in Jack­son aren’t real­ly engaged in build­ing their own city.”

Despite the change of course in city gov­ern­ment, king says Coop­er­a­tion Jack­son is still work­ing on build­ing co-ops that are large-scale, and get­ting as many peo­ple engaged in eco­nom­ic democ­ra­cy as pos­si­ble.” The move­ment has a his­to­ry of black com­mu­ni­ty par­tic­i­pa­tion in coop­er­a­tive enter­pris­es to draw from, king notes. Mean­while, adds Coop­er­a­tion Jack­son mem­ber Iya’­Falo­la Omobo­la, while the group works to get child­care and urban farm­ing coop­er­a­tives off the ground, with or with­out city sup­port, We’re going to be ready to mobi­lize around an appro­pri­ate can­di­date in the next [may­oral] election.”

Not­ing the par­tic­u­lar con­di­tions that have helped secure local sup­port for coop­er­a­tives in New York City and Jack­son, the Democ­ra­cy at Work Institute’s Hoover acknowl­edges that activists are still explor­ing how these can be repli­cat­ed else­where. But if these cities are suc­cess­ful in retain­ing long-term sup­port for coop­er­a­tive growth, they can serve as a jump­ing-off point for oth­er areas. Our hope is that these won’t be one-off exam­ples,” Hoover says. What we need ulti­mate­ly is a shift among those doing local devel­op­ment: from, Quick, let’s get a Home Depot to come in and cre­ate jobs, but they’re low-wage and low-skilled,’ to a deep­er and more patient strat­e­gy. These places could real­ly start that shift.”

Rebec­ca Burns is an award-win­ning inves­tiga­tive reporter whose work has appeared in The Baf­fler, the Chica­go Read­er, The Inter­cept and oth­er out­lets. She is a con­tribut­ing edi­tor at In These Times. Fol­low her on Twit­ter @rejburns.
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