In 2009, the Co-op’s owner-members voted to include in our bylaws the possibility of extending Patronage Refunds to Co-op owners.
This means that at the end of each year Co-op Owner-Members may receive a Patronage Refund based on their purchases if the following criteria are met:
1) The Co-op has been profitable,
2) The Board of Trustees determines that we have made sufficient profit (after reserving some as a “rainy day” fund to protect the financial integrity of our business), and votes to return some percentage to current Co-op owners in the form of a Patronage Refund.
3) Patronage will only be returned to Co-op Owner-Members who have kept their membership active and their contact information up-to-date (after all, we can’t mail it to you if we don’t know where you are!)
Patronage refunds come from the extra that Owners pay to insure that the Co-op can meet all of its financial obligations. If not allocated as patronage the IRS views it as taxable income. The Co-op would much prefer to return this money to our Owner-Members than to send it along to the IRS in the form of taxes!
We’re not talking hundreds of dollars per person here – for most of us, the Patronage Refund will come out to be less than the price of a grocery trip. The easiest way for you to redeem your refund will be in the form of store credit, but we will also cut you a check, if you prefer. The more you shop, the more you get back. If your purchases for the year equaled one percent of all purchases by Co-op Owners, your share would be one percent of the Patronage Refund dollars. So, big shoppers who spend more will receive more back at the end of the year. If your refund amount is not large, you may think “I’ll just let the Co-op keep it -”; but if you don’t redeem your refund then that amount becomes taxable income and we must pay taxes on it. We hope that you will use your refund as store credit and we can keep that capital circulating among Co-op Owners. (Note: The Board has voted to disallow Refunds that are less than $2: it is simply not cost-efficient to distribute such small amounts).
We put the plan into action for 2010 and distributed our first Patronage Refund in 2011. Patronage Refunds are NOT guaranteed – they are based on how profitable the business is in any given year. Our priority is to remain a viable and healthy business, and if we have a good year but not a great year, the Board may choose NOT to issue Patronage Refunds for that year, in order to retain capital for infrastructure improvements.
All Co-ops, including ours, are committed to having their Owner-Members share in their financial success. Co-ops are a powerful model of equality and fairness in today’s economy, and Patronage Refunds are an important example of that. When you join the Co-op as an Owner, you wisely put your shopping dollars to work supporting a fairer economic system and a healthy food system, which will benefit you and your family immediately and in years to come.
What can you do to help make Patronage Refunds possible?
1) Shop at the Co-op!
2) Keep your Membership up-to-date (dues and contact info)
3) Give the cashier your Member Number at the beginning of each transaction, even in the Deli
Members of other co-ops: we’re happy to continue extending our pricing to you, but if you do the bulk of your shopping with us, now is a great time to become an Owner-Member here. Our cashiers can help walk you through this process, just ask!
SENIOR MEMBERS: To qualify for Patronage Refunds, federal law requires that you become a PAYING OWNER-MEMBER of the Co-op, because patronage is payable ONLY TO OWNER-MEMBERS who make equity payments to the Co-op. Most seniors currently shopping at the Co-op receive complimentary member sale pricing solely as a benefit of their status as seniors, and are not currently required to make equity payments like regular members.
EBT customers: we offer you complimentary member pricing, but unless you are using your current member number during each transaction, it won’t count.