The following comments were made to City Council during the May 7, 2013 meeting on the agenda item dealing with the Renaissance Center redevelopment proposals. RCC Steering Committee Members Tavish Warren, Louis Beveridge and Casey Thomas spoke about the RCC project and it’s vision. Visit the City of Greensboro website to view video of this meeting.
Good evening. My name is Tavish Warren. I’m the Secretary of the Renaissance Cooperative Committee, or RCC, the group that’s working to bring a community-owned grocery store to my neighborhood in Northeast Greensboro. Thank you so much for this opportunity to tell you about what this effort means to me personally, and to my community.
As you know, our neighborhood lost its grocery store in 1998, and since then we have lived in a “food desert,” a place where people have no access to the healthy, affordable food that other people in our city take for granted. In my neighborhood, this is serious, because many of us—like myself—don’t have cars. We have to rely on the local convenience stores, where the food is over-priced, limited, and unhealthy. It’s not just a health and economics issue—it’s demeaning and discouraging, knowing that just a few miles away, other people in our city have their choice of healthy food at reasonable prices. There is something wrong with this.
Winn-Dixie didn’t leave because people in my neighborhood weren’t buying food, or because their store wasn’t profitable, but because Winn-Dixie, was seeking a higher level of profit. No other grocery chain came in—for the same reason—despite more than a decade’s effort and the many great deals being offered by the City, which purchased the shopping center.
Winn-Dixie’s departure was the beginning of a decline, not just for the shopping center, but also in my community’s sense of itself: our worth, our value, our potential. You may think I’m too young to have observed this decline, but I hear about it from my elders all the time. Hazel Jones and Leo Steward, who serve with me on the RCC Steering Committee, have lived just blocks from the Bessemer Center for years, and they talk about the discouragement and hopelessness for the community that they feel every time they look at the decaying shopping center. My family and I live just blocks away, and we feel it too, even though we’ve only been in the area a few years.
In the midst of this discouragement, however, something interesting started to happen. Some folks started to think, “Well, it looks like ‘they’ are not going to bring us a grocery store. Maybe it’s time to quit waiting on ‘them’. Maybe we should get together and do this for ourselves.”
As a nineteen year old, that got my attention. I’m just starting out in my adult life, and I knew that this kind of “do for ourselves” spirit was something I wanted to be part of. I need that kind of energy and attitude to achieve my dreams. That’s why, since last fall, I spend ten to twenty hours each week, working on this fascinating, uplifting, difficult project of building our grocery store in our neighborhood.
Part of this is about bringing food into a food desert. But it’s more than that. It’s about building community, too. Now, you know you have something interesting going on when the age range of the Steering Committee goes from 19 to 70-something! (Although Leo often reminds us that he is the youngest one of us!)
It’s also about the empowerment of learning about something you really, really need to know about—not just because some teacher told you it was important. Did I think a few months ago that I’d know how to read a financial statement? That I’d be calling up the mayor and Council members to ask them to sit down with me to talk about our plans? Did I imagine that I’d be speaking at City Council? No! But I’m doing all these things, with the support of my RCC community and F4DC, who work together to figure out what we need to learn next and how we’re going to learn it together.
This project is also about community self-determination and democracy. A coop grocery store—a store owned by the community for the benefit of the community—is governed by its members. This means the owners of the store can’t decide to just pick up and leave when they see ways to make more profit elsewhere. That’s what happened with Winn-Dixie.
We know that our store has to be profitable to succeed, but that’s not our only purpose. Our purpose is to provide healthy, affordable food to my neighborhood, along with dignified, good-paying jobs to people who live in the neighborhood. If we want to meet our mission, the store has to stick around, and if it is to stick around, it has to operate as a smart, well-managed business. That’s why we’ll be doing a nationwide search to hire an experienced grocery store general manager to make sure our store will be successful.
Another key thing in this project is that the profit will be in the control of the community. Each year, the community will get to decide what it wants to do with the profit. I can hardly wait to hear and weigh all the ideas people have. One way we could spend our profit is to save it up as the down payment for purchasing the entire shopping center! Imagine a community coming together to control and democratically govern major asset like that! That’s a far cry from the discouraging scenario we have now! And we know that with the support of the city and lenders like Self-Help Credit Union working alongside us, this dream can become a reality.
That’s why I spend so much time every week in steering committee meetings, and community meetings, and going anywhere anyone wants to hear about the coop. That’s why I am chronically behind on my political science work at Greensboro College—because I am studying up on democracy, and I have a real-life laboratory to see how it works. I hope you all on City Council are going to be part of this democratic, community-based effort too. We need you.
I’ve been pretty passionate in explaining the importance of our dream. The next speaker, Louis Beveridge, is going to fill you in on the specifics of our progress.
Hello. My name is Louis Beveridge. Thanks for letting me follow up with more detail on the Renaissance Community Coop and how far we’ve come in turning our dream into a reality. No matter how compelling or beautiful, a dream can’t bring itself into reality. That’s the job of the people who share the dream.
Our first step toward reality was doing the due diligence to see if a full-service grocery store at Bessemer Center was financially viable. To answer this question, we commissioned a professional market study by Russ and Associates, a grocery consulting firm with over 30 years experience. Based on census and industry data, plus a site visit, that study showed that a 10,000 square foot grocery store in Bessemer Center would gross $4 million per year, with the very conservative assumption of pulling only 5% of existing market share. Council members have received a copy of this study in the packets we left with each of you.
Next, we worked with certified coop developers at F4DC to prepare a set of three-year financial projections that looked at revenue, expenses, cash flow, capital needs, debt service, and so on. Again, using very conservative assumptions, our projections showed the viability of the effort: we would begin operating in the black within the first year, even including debt service. The projections also showed start-up costs of over $2 million, to pay for leasehold improvements, design and business consultation, equipment, fixtures and furnishings, inventory, pre-opening staffing, and contingency.
Satisfied that the grocery store was viable, we then set about the task of building our own capacity to take on this project. Through our own fundraising and the support of F4DC, we sent five steering committee members to a three-day intensive workshop on opening coop grocery stores, sponsored by the Food Coop Initiative, in Bloomington, Indiana. That’s just one of the many ways we are consciously building our know-how in every aspect of launching and governing our store, from store design to grocery operations to community outreach to democratic governance.
One of the main benefits of attending this kind of workshop is the opportunity to learn when we can do something ourselves, and when it’s time to call in the experts. Believe me, we know how important expertise is in launching a successful store, and we are working with experts across the board, from our attorney who specializes in coop business law to a raft of resource people in the grocery and coop grocery world. Most recently, we’ve been invited by two different grocery stores—Deep Roots Market and Bestway—to tour their stores and ask them for any kinds of information we need. Both connections will help us identify vendors and gain entrée into distribution networks that can bring down our prices. A partnership with NC A&T’s urban farm project is also in the works – another key to good food at affordable prices.
You may be wondering where we are in raising the $2 million we need in start up costs. We know $100,000 will come from member equity: At least 1,000 households will pay a one-time membership fee of $100 to become an owner of the coop. This isn’t just about adding $100,000 to the bottom line. If that were the case, then a Sam’s Club membership would be the same thing (if only you didn’t have to renew your Sam’s Club membership each year). This $100 ownership fee buys you one share and one vote in the coop. It’s the member owners who elect the board of directors and participate in the annual meeting where the big decisions are made. That’s what having skin in the game means—it’s fundamental to community ownership. Of course, anyone will be able to shop at the coop grocery store, but it’s the member owners—the people who put money on the line—that have the privilege and duty of shared democratic control.
Now, how are we going to sell 1,000 memberships? Already people are clamoring to become members, even though we haven’t officially launched our membership drive. We have paying members from all across Greensboro, signaling strong support for this innovative approach to economic development that extends even beyond the neighborhood.
To reach 1,000 memberships is going to take a well-organized, community-wide effort, and that’s going to require a paid Membership/Fundraising Coordinator. We are in serious conversations with the Community Foundation of Greater Greensboro and other local foundations about a grant to pay the salary and overhead for this position as well as other start up work. With a coordinator in place, we are confident we will have at least 750 memberships by the end of 2013, and 1,000 by the time we open our doors in 2014.
That $100,000 in member equity is critical to any coop’s success, but it’s just 5% of the $2 million we need. Where will we get the balance of our start-up funds? Through a combination of grassroots fundraising, grants, and loans. If that sounds complicated to you, let me say that this is a very normal trajectory for food coops. One of the innovative ways that food coops raise money is through owner loans, in which individuals make small to medium sized loans to the coop. Deep Roots Market, for example, has raised almost $500,000 in owner loans to pay for its expansion. We haven’t even launched our full-scale owner loan drive, and already seven people have stated that they are interested in lending $33,500 in total. Our overall goal for the owner loan program is $300,000, and with a Membership/Fundraising Coordinator in place, we are confident we will reach this goal.
All this individual support is important, but it has to be complemented by institutional support. That’s where the City comes in, along with lenders who are committed to community development. We are in conversation with North Country Development Fund, one of the lenders behind Deep Roots’ expansion, and a loan is very possible there. And, as every Council member knows, we just last week received a term sheet from Self Help Credit Union offering $700,000 in lending, at very reasonable interest rates! Self Help’s review of our financial documents, market study, and proposal to Council led them to decide this was a viable and exciting venture. We hope Council will agree to be part of it, because the City’s partnership is key to this project. It’s what makes this a paradigm-shifting model that can scale to other neighborhoods and to other cities.
Our next speaker, Casey Thomas, will say more about the ways we are hoping the City will step up to join this project.
My name is Casey Thomas. I have been working on the RCC Steering Committee for many months now, focusing mostly on fundraising and outreach. Over the past three weeks, we RCC-ers have attempted to schedule meetings with each and every one of you Council members, so we could discuss our plans for the coop grocery store, explain our preferences and reasoning, and answer any questions you might have. We managed to meet face-to-face with eight of you, and we dropped off a packet of information for the one member whom we were not able to meet.
Through this process, we’ve provided each of you with a wealth of financial projections, a market study, detailed proposals, financial commitment letters, and a host of other materials that prove the viability of this project. One aspect of this project’s viability that’s hard to document in paper form is the strength of community commitment to this effort. You’ve maybe gotten a glimmer of it through face-to-face meetings, through our website, and via postcards, emails, and phone calls. Now I want you to see one more proof that the community wants the coop.
Can everyone here tonight who supports Renaissance Community Coop please stand, so Council can see how many of us there are, and how diverse we are?
We are young and old. We are black, white, and brown. Many of us are struggling to get by, some of us are smack-dab middle class, and a few of us are downright affluent. The vast majority of us live in Northeast Greensboro—our Steering Committee is dominated by people who live within blocks of Bessemer Center. But this innovative approach to economic development, which puts the community squarely in the center, democratically deciding its future and making it happen, is so exciting that we are joined by people from all over Greensboro who want to be part of this new approach.
People all over Greensboro—all over the country, even—see that the old forms of economic development haven’t worked. They see that we have to invent new ways of doing business, ways that put communities and people’s needs right on par with the economic imperative of making money. There is a distinct role for individuals, their communities, and City government in this new way of doing business.
In our visits to Council, we’ve made clear our preference regarding current and near-term ownership of the shopping center. We have a preference for City ownership over the next few years, because we think that’s the only path toward the community ever coming to own and control the shopping center. That’s the big vision that this grocery store project is linked to, and our partnership with supportive lenders like Self Help makes us think we have a real shot at it.
That being said, we so much appreciate the willingness of both developers with proposals before Council to include the coop in their plans and to offer equally supportive rent arrangements. We take this willingness to mean that the coop has a home, one way or another.
What we need now, though, is certainty. Certainty about exactly who will own the center, what the terms of the lease will be, and what kinds of financial support we can count on from the City. Without this certainty, we’re unable to get additional commitments from the thousand-plus members we need. People want to know that this thing is really going to happen before they put their hard-earned money down. Without certainty, we can’t get serious about promoting our owner loan program. People aren’t going to invest their savings with us, unless they know that a real, operating grocery store will have a revenue stream from which we will pay them back. Our outreach to local and regional foundations is similarly stalled—their program officers rightly want to know that this project has a home and sufficient support to make their investments worthwhile.
For the last eight months, the RCC has dutifully gone about its work of learning, community-building and fundraising. We have fundraised our way to $740,000, and spread the word so that hundreds of people are ready to join. We’ve done our part. Now it’s your turn. We need Council to stand up and say, “Yes” to these three requests:
- We request a supportive lease arrangement, of a term of 25 years and at a rent capped at $2,000 per month. We will use this generous rent deal to make sure our prices stay low and so we can offer great jobs with health benefits, starting at $11.00 per hour. Having such a long lease term, with leasehold rights attached, also provides a bankable certainty that helps us secure financing.
- We request an economic development grant of $100,000, which is in line with the grant provided to Proctor & Gamble, given that we will create a minimum of 23 good-paying jobs with benefits.
- We request an economic development loan of $600,000, at 0% interest, to round out our financing picture.
If we can have a commitment from Council in these three matters, we feel confident that we can raise our memberships and the rest of our financing. Then we can get on with the business of building a community owned grocery store in Northeast Greensboro that everyone can be proud of!