Event:2015/11/02 Fundraising

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'Until the Revolution'/Fundraising Working Group Meeting - 2 Nov 2015

Attendees

  • remote-jenny (not feeling well), laura, joe, rob, yar, josh, joel

Updates

Last Week's Call w/ Lender

Email and new proposal from lender:

Possible approach with OmniCommons: KISS

Set up an LLC to buy the property:

  • LLC would be owned by the Open Library of Richmond (501c(3)) which owns 3 properties for permanent non-profit use already
  • LLC would have a board: omni, OpenLibrary, maybe bay area land trust fellow?, others?
  • Initial capital for purchase would come from OpenLibrary of Richmond
  • LLC would pay OpenLibrary of Richmond 5% of initial capital amount each year, adjusted cpi

Rent to the occupants would be calculated as

  • capital-cost + ($50k/year if $1M initial capital)
  • taxes + (apply for welfare exemption (real estate tax) for maybe $20k onetime lawyer fees)
  • lawyer&accounting&insurance + ($1k+$1k+15k? based on Internet Archive building)
  • maintenance-and-repair-fund ($70k/year ? guess maybe could be lowered later).
  • maybe $135k/year or $11k/month? (then would move up with CPI)

OmniCommons would get 10 (?), 20 (?), X (?) year lease from LLC and seat on board of LLC

  • It could raise the initial-capital cost at any time and then get a permanent rent abatement (the capital cost line item above would go away).

Omni could contract with Bay Area Land Trust fellow to advise if they want to help with budgeting.

message sent trying to explain a bit:

Forwarded Message --------

Subject: Re: Omni Commons followup Date: Fri, 30 Oct 2015 09:43:41 -0700 From:

Sorry the conversation was crammed at the end of the day when I had to leave.

What I was trying to solve is how to have the omni owned by a non-profit that could care for it physically and financially in a simple, long lasting, inexpensive, and positive way. Bay Area Land Trust would not take any financial risk nor help with "bad guy" status if finances turned bad. At least he was clear, but then of limited value. I am reluctantly taking that on in what I wrote.

In my google doc I was suggesting using an entity that exists for this purpose already and putting $1M+ in initial capital (for 5% ongoing). Then the LLC that would be the actual owner of the property could be set up any way we want, most importantly a board that works for this purpose.

One thing you might want to consider are the fees required for the Bay Area Land Trust. If I understand it, they have ongoing expenses that will be paid for by the renters of their properties. If they are successful and build staff, then it could be thousands a month. It might be worth it, but if they own the land, they can charge whatever they want, no recourse.

The Open Library of Richmond does not need any money from its properties (now 3 of them). All the money (except the cost of the initial capital) stays serving the building inside the LLC. In other words, no fees.

The new LLC would manage the maintenance fund, legal and such. The Omni would get to make the decisions on the use of the space.

If the Omni thinks it needs property management services to help it run, then you may want to contract for that, maybe with the bay area land trust guys maybe others, but allowing yourselves to renegotiate in the future can be helpful.

If this feels more "other" than the non-profit structures you were thinking about, then don't do this. Really. The only upside in this for me is to help keep a property supporting non-profit purposes. What I don't want is a bad scene-- not worth it. This has to be simple, long lasting, and

discussion

  • laura answers josh & robb's questions
  • unclear whether that capital cost pays down the principle, or whether it's perpetual
  • yar thinks it's better than what we have now - lower monthly cost, more stability, locks in the purchase price for longer than 2017. EXCEPT for the part where it's locked into his nonprofits forever. i think our eventual goal has to be running the building as a collective, and not as a hierarchical board, and we have to make that clear. if he wanted to just own the land and give us the building when we're ready, that'd be a better pill to swallow
  • Need to get Jesse's opinion. - Laura
  • can we really raise a million? yeah, just need more time
  • rob: the ingredients are here in the kitchen but we're so used to eating hot dogs
  • we have until summer 2017, but every month that goes by we throw more money into that hole. if we wait til then we've lost another quarter mil
    • laura: if we had a quarter million we could get a loan from broccoli & pay that back in 10 years
  • mari is planning a party
    • rob: we're not gonna party our way into owning this building

potential donors

  • dress mentions california sustainable arts trust & kenneth rainin foundation
    • 15k went to fnb but not part of indiegogo. nobody remembers how or why
    • https://medium.com/@KR_Foundation/
    • how to follow up? what led to the donation? who has the relationship?
  • rob wants to shamelessly ask people like google. no strings but ask.
  • dress is tied into the mj world
  • rob: tech has all the money around here
    • yar: nooo there's oil companies, kaiser
    • debate over having a health worker conference
  • some random person named AK offering us money to get the building up to code? nobody has any idea?
  • joe met somebody at the phat beets farmers market who runs the SF commons. small scale donations
  • burlington coat factory bail guilt from 1969

banks

  • what about a loan from the bank?
    • yar: no, too much value in the land if you build condos. if a bank gets its teeth in this property they'll have people whose full time job is to take it out from under us
  • or credit union or community development bank?

grants

  • major donor is willing to pay an experienced grant writer. didn't say an upper limit. let's find somebody
  • laura can ask her friend
  • joe remembers someone in the brower building
  • could give them a percentage, or an hourly rate
  • andrew's working on one

new tenants

  • rise above
  • disco room
  • basement rooms

phone-a-thon

501c3 App

  • Jenny: We're pretty much ready with the exception of our Financial Statement. Our bookkeepers are working on it, but if we want to send the application off before the end of the month we'd need to pay them to prioritize it. $75/hr or roughly $2500 total (via Matt G), potentially open to an installment plan.
    • Laura : I spoke to Loren and Kelly Rose, the bookkeepers. They say that the books are in very bad shape and they need info from the collectives. I think FInance needs more help.

Grants

Action Items

  • Ping Jesse re: Broccoli's proposal [Laura]
  • Attend Finance Mtg this week [Jenny, you?]
  • find pro grantwriters
  • yar will try to find a list of people who've had events here before

Previously

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