http://yesmagazine.org/article.asp?id=3512
Cleveland’s Worker-Owned Boom
by Gar Alperovitz, Ted Howard and Steve Dubb
Rust-belt to recovery.

What’s so special about this laundry? In a word, ownership. The business
will be 100 percent owned by its 50 employees, virtually all of whom
live in the surrounding community. Life is tough in this neighborhood,
where the poverty rate exceeded 30 percent and thousands of homes lay
stripped and abandoned even before the current recession began.

In the midst of this urban distress, the Evergreen Laundry
employee-owners will earn a living wage and health benefits. As members
of the co-op, they will enjoy greater job security than workers at more
traditional businesses, and, after seven years on the job, they will
have built an ownership stake of as much as $65,000.

The laundry is the flagship of a wider network of Evergreen Cooperative
businesses, part of an effort to transform the quality of life for
Cleveland’s low- and moderate-income residents.

While its planners—the Cleveland Foundation, the Ohio Employee Ownership
Center at Kent State University, ShoreBank Enterprise and others -- drew
on experiences gained in cities around the country, the Evergreen
initiative represents some important firsts. It is the first attempt to
bring together the economic power of “anchor institutions” --
universities and hospitals, in this case -- that have a long-term
commitment to the city. Instead of luring outside corporations with
promises of tax breaks and lax standards for labor and environmental
practices, the Evergreen strategy develops home-grown worker-owned
enterprises that can offer ongoing services to these anchor institutions.

This represents the first significant effort to create green jobs that
not only pay a decent wage, but also build assets and wealth for
employees, since they are not only workers, but also owners. If
successful, this initiative could become a national model.

Solar Cleveland

Later this summer, Ohio Cooperative Solar (OCS) will begin installing
solar panels on the roofs of the city’s biggest nonprofit health,
education, and municipal buildings. These institutions will lease their
roofs to the employee-owned energy co-op, and in turn will purchase
electricity from OCS. Within a few years, OCS and its worker/owners will
own and reap the income from the largest installation of solar panels in
the Midwest. The long-term goal is to develop a workforce capable of
carrying out similar installations throughout the state.

Another co-op will advance large-scale urban agriculture—something
missing in an area that spends $7 billion on food shipped in from
California, Arizona, and even Hawai‘i.

Evergreen City Growers will build and operate a year-round hydroponic
greenhouse located in the heart of Cleveland capable of producing more
than 3 million heads of fresh lettuce and nearly 1 million pounds of
basil per year. The company will employ about 50 local low-income residents.

That Cleveland may become a center of an innovative, green,
wealth-sharing economy is especially remarkable because the city has
been one of the hardest hit by the flight of capital and jobs. Cleveland
was once home to major steel producers and auto-makers, and at its peak
in 1950, it was the nation’s fifth-largest city, with a population of
915,000.

Today, the population is 440,000 and falling. Cleveland is among the
five poorest cities in America. There are at least 15,000 vacant
buildings in the city and more than 3,300 acres of vacant land.

Is there a future for older industrial cities like Cleveland? That was
the question Ronn Richard, president of the Cleveland Foundation, asked
himself when he was appointed in 2003.

The answer, he and his colleagues concluded, lay in building on the
city’s most significant assets: the network of health care, higher
education, and cultural “anchor institutions” that are a legacy of the
city’s once-strong manufacturing base. The university and hospitals are
prominent among them.

These institutions together purchase many billions of dollars of goods
and services, and they are among the only institutions still growing.
Because they are rooted in place, they have a self-interest in ensuring
their surrounding neighborhoods are safe, healthy, and vital communities.

“If we could work with these institutions, particularly in helping them
focus their business and investment practices locally, we could create
economic energy and opportunity for local residents,” he says.

Thus was born the Greater University Circle Initiative, which includes
the Cleveland Clinic, University Hospitals, Case Western Reserve
University, and a number of other health and cultural institutions in
the city.

The Evergreen Cooperatives represents the Initiative’s best bet for
Cleveland’s future, and other stakeholders are getting on board. Local
foundations, hospitals, nursing homes, banks, a university, and City
Hall are each investing in the Evergreen network of community- and
worker-owned enterprises. These co-ops are structured to serve the
anchor institutions’ ongoing needs for laundry services, energy, food,
janitorial services, records retention, and so on. The goal is to create
jobs and wealth within the city, multiply the impact of local dollars by
keeping them in the community, and regenerate the local economy,
particularly in the city’s most distressed neighborhoods.

Evergreen companies will hire and train employees from low- and
moderate-income neighborhoods for jobs in the cooperative enterprises. A
local nonprofit specializing in workforce development is recruiting
workers through church and other networks. More than 90 neighborhood
residents—some who have been laid off during the current recession,
others who have been underemployed for years—attended the first
community hiring meetings. Some of these men and women will become the
first Evergreen employee-owners.

By linking green jobs to wealth creation, Evergreen is pioneering a new
approach to organizing the green economy. After all, if green jobs are
good, isn’t a green job you “own” even better?

Green Jobs You Own

The Evergreen businesses are aptly named: all aim to be environmentally
sustainable. The Evergreen Laundry, for instance, will be the greenest
commercial-scale laundry in Northeast Ohio. The cooperative plans to
construct its building to LEED silver certification standards, and it
will use energy-efficient washing machines and dryers along with
processes to reuse waste heat and water.

These green features give the cooperatives a competitive advantage. Most
of the city’s anchor institutions are committed to decreasing their
carbon footprints, and doing business with the Evergreen enterprises
will help them deliver on their goals.

These co-ops are a good start, but there are many people in Cleveland
who need good, stable employment.

So the issue of “moving to scale” is central to Evergreens’ economic
development strategy. Put simply, how do you move from 50 jobs to 500,
and then to 5,000?

Access to capital is the key to expanding impact. In Cleveland, the
Evergreen Cooperative Development Fund was formed to provide seed
financing for the next generations of worker cooperatives. The Fund is
modeled in part on Spain’s Caja Laboral bank, with initial funding from
foundations. But as they grow, the Evergreen co-ops will be an
increasingly important source of funding for other co-ops; each will
dedicate at least 10 percent of their pre-tax profits to the Fund to
help build the cooperative network.

Cleveland Mayor Frank Jackson probably speaks for many mayors when he
says: “In these tough economic times, our cities need not only good
jobs, but ways for working people to build up their family assets and
wealth. Why shouldn’t all of our citizens have access to meaningful jobs
in workplaces where they can own a piece of the company and participate
in the company’s direction?”

Matching words to deeds, this spring the mayor’s Department of Economic
Development became an “investor” in the Evergreen Cooperative Laundry
with a low-interest loan of $1.5 million.

Ted Howard, Steve Dubb, and Gar Alperowitz wrote this article as part of
The New Economy, the Summer 2009 issue of YES! Magazine. Ted is the
executive director of The Democracy Collaborative at the University of
Maryland. Steve is the senior research associate of The Democracy
Collaborative. Gar is the Lionel Bauman Professor of Political Economy
at the University of Maryland and the author of Unjust Deserts. The
Democracy Collaborative worked with the Greater University Circle
Initiative on the development and implementation of this economic
development strategy.

http://www.Community-Wealth.org.

--
Dan Clore

My collected fiction: _The Unspeakable and Others_
(Wait for the new edition: http://hplmythos.com/ )
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