Event:2015/09/14 Until the Revolution Working Group
Omni "Buy the Building" working group meeting - Monday September 14, 2015
Attendees
- yar, laura, jenny
Update on Lender
- No response, it's been over a month since we heard from him
- Reportedly out of town until Thursday the 17th
- we're having a lot of anxiety about this but mostly confident based on things he's said before
Ground Lease
- Waiting on response from BACLT's meeting last week
- Since so many of the clauses are holding us to our financial committments, we are taking a huge risk if we can't fulfill them and BACLT chooses to hold us accountable to that
via Jesse from 10 Sep:
"I would like to add terms to the ground lease and/or the loan requiring the lender to notify BACLT if there was a non-payment of the loan, as well as a right by BACLT to pay to avoid default and collect the amount paid from Omni as a component of ground rent.
After considering the question of what would happen if Omni went under, I think it makes sense to give BACLT an option to purchase the improvements if Omni defaults on the lease and a right of first refusal to purchase the improvements prior to Omni selling them. The price would be an amount sufficient to repay loans.
The danger is that BACLT could try to use the property for something not intended by Omni. But the purpose of such a provision would be for BACLT to steward the land for public purposes if Omni ceases to function. Such an option to purchase is standard with affordable housing land trusts, but in that case the assumption is that the land trust can sell or re-rent the property as housing. With the Omni, it is far from obvious that BACLT would be able to find a tenant to operate anything like Omni. BACLT also might not be able to raise funds to purchase the improvements. Some land trust ground leases include a provision permitting the lessor to charge a higher ground rent if a substitute tenant doesn't operate the property for the original charitable uses, with the assumption that the additional income would help subsidize other low income housing. I think having such a provision makes sense in this case.
This means that if the lease was terminated based on a default by Omni, BACLT could either (a) purchase the improvements or (b) Omni would have to sell the improvements (since it wouldn't have a right to use them absent a ground lease). If Omni sold the improvements to a tenant that complied with non-profit restrictions of the ground lease, the original ground lease would apply, but if not BACLT would have the right to charge market rate rent under the ground lease."
our goals
- yar: our original reason for seeking a ground lease was to make sure omni would remain radical, relevant, grassroots, community-based, and fulfill the purposes in its founding document - radical commoning of space & resources, and the statement of solidarity. we should audit each of these lease terms and ask "how does this help with that? alternatively, how might this work against that or make it more difficult?"
- laura: Also the idea is to prevent the loss of the building because of taking out a loan on it and not being able to pay it back, or becasue of shenanigans that might allow one person or a small group to aquire the building and sell it or otherwise use it for their private benefit. This is one of the main concerns of the lender.
- I mentioned adding a clause about being a threat to capitalism, and Rick countered by saying this isn't necessary, because land trusts are inherently anticapitalist. This mindset concerns me. In my opinion there's nothing inherently radical or threatening about land trusts. Consider the Jewish National Fund, which has played an important role in the military occupation of Palestine. Even though they've given many 99-year leases to kibbutsim from 1901 until today, can anyone seriously argue the JNF is a threat to capitalism? Are we lowering our standards here, or potentially having our ideas be coopted and recuperated? https://en.wikipedia.org/wiki/Jewish_National_Fund
501c3 Application
Charitable Activities response
Let's review Jesse's draft and add what we can: https://pad.riseup.net/p/omniactivities
See also Jesse's recommendations on achieving 33% charitable status: https://pad.riseup.net/p/omniconsiderations
See also the spreadsheet of projects & charitable activities here: https://docs.google.com/spreadsheets/d/1zgwbWbATZhqVIKHwJagmxnjI-pnUTQVL2SrWKdgqkq8/edit#gid=0
- In particular, need approx. square footage of space usage of all collectives. Jenny started this but is kinda winging it.
- Also need to finish writing short descriptions of each project.
- Still need to reach out to: Real Vegan Cheese, Fermentation Station, and various publishing groups using TIL - Jenny emailed 9/14
- What about BACLT receiving the $1mil donation and giving the building to Omni's 501c2?
ballroom
- anxiety about being able to make money with the ballroom. if we can't rent that out, we'll never be able to survive, let alone meet all of the exciting new financial obligations we're now writing into our ground lease...
- laura wonders how Alliance Graphics manages to make money for MECA
- yar: when people have a wedding here we should force their whole family to watch an educational film for 20 minutes. seriously i've been to way weirder weddings
- apparently if we fiscally sponsor other groups, part of their income counts as well. more complicated accounting but lots of potential. lots of groups need a way to get tax deductable donations.
- after some thought, yar thinks this would be a great problem to have. we should plow ahead with c3 AND make as much money as we can with the ballroom. it's a 4 year average. if omni people in 2019 are faced with needing to make some serious charitable donations or lose c3 status, so what? there are way way way worse legacies we could leave them. don't let anxiety over this cloud our decision right now. some problems are relatively straightforward can be solved in the years to come. this is one of them.
Other ToDos
- Finalize Board of Directors: GWS has decided not to choose a director at this time. Still waiting on a bio from Jose: https://docs.google.com/document/d/15tq20ptUPe_qTPLEEynvQwSFbWtuGsFbVpy4AOGcoec/edit
- Financial Statements: Need past finance history as well as a projected budget. Jenny has forwarded this request to Finances and reminded them earlier today, they are working on it.
- Still need subleases from: Optik Allusions (Jenny meeting with them tomorrow), Material Print Machine (Jenny pinged Lara), Phat Beets (Jenny asking DK), Global Women's Strike (Niki working on this), and Food Not Bombs (Jenny asked Helen)
Action Items
- Digitize and send sublease agreements [Jenny]
- Finish bios for BoD [Jenny]
- Print, sign and send updated Bylaws [Jenny]
- Ping lender again [Jenny]
- Edit Charitable Activities response: https://pad.riseup.net/p/omniactivities
- Contact Media Alliance & SchoolFactory re: overhead for being a fiscal sponsor of multiple projects [Jenny]