Worker Cooperatives

Small businesses are the foundation of the City and the City’s well-being is inextricably linked to a strong business environment. One of the City’s Strategic Plan primary goals is to implement policies and strategies for economic development to encourage businesses to grow and prosper that provide living-wage jobs, reduce unemployment, and improve the quality of life for its residents.

WHAT IS A WORKER COOPERATIVE?

Worker cooperatives are businesses owned and operated solely by its workers. These businesses provide local goods and services, stable jobs for residents, and offer new economic opportunities for lower income workers in the City.  A worker cooperative is different from a typical business structure in that the profits are shared amongst the owners and each worker has an equal vote in the direction and actions of the business.

RESOURCES AVAILABLE TO START A WORKER COOPERATIVE

Today, there still exist several barriers to the development of worker cooperatives which include: lack of public awareness of its benefits; limited technical support in forming, operating, or converting existing businesses to a worker cooperative; difficulties obtaining financing for cooperative formation or conversion; and high startup costs (permit fees, license fees, lease rates) that many small businesses experience in California. As local municipalities look for new and strategic forms of community economic development efforts, Santa Ana has the opportunity to be a leader in Orange County to support and reduce barriers for the development and future of a cooperative economy in the City. 

Online Resources Available

SANTA ANA WORKER COOPERATIVE RESOLUTION OF SUPPORT

On August 1, 2017, the City of Santa Ana took the first step in community wealth building by becoming the first city in Orange County to adopt a Resolution of Support for worker cooperatives.  This community economic development initiative was aimed at increasing the wealth of the City’s residents and providing the necessary resources for residents to become business owners in the City.

Resolution - Supporting Development and Growth of Worker Cooperatives in Santa Ana

SANTA ANA WORKER COOPERATIVE SUPPORT PROGRAM AND POLICIES

The purpose of this program is to encourage and support the development of worker-owned businesses in Santa Ana by creating new markets and providing technical support to enable worker cooperatives to grow and succeed in the City. 

Policies

  1. Designate City Liaison and broaden specialization of staff to include worker cooperative expertise within the Economic Development Division of the Community Development Agency.  Staff will work with community organizations, stakeholders and existing worker cooperatives to evaluate and assist in the removal of barriers to development and growth, assist in identifying potential incentives and financial resources, and promote worker cooperative conversion as a path to worker ownership.
     
  2. Coordinate business development efforts and develop partnerships among the cooperative ecosystem (City departments, worker cooperatives, technical assistance providers, financial institutions).  Staff will coordinate efforts to support and promote worker cooperatives with other City Agencies to assist in the streamlining of permits and city approvals required to start up a worker cooperative.  Staff will create a strategy for connecting worker cooperatives with demand markets, technical assistance providers, and resources for financial assistance.  Staff will develop partnerships and meet regularly with community-based organizations, existing worker cooperatives, technical and financial partners and others.   These meetings will help guide the strategy for worker cooperative development.
     
  3. Identify obstacles deterring local entrepreneurs from starting worker cooperatives, or employees and business owners from converting their businesses to worker cooperatives.  There still exist several barriers to the development of worker cooperatives which include: lack of public awareness of its benefits; limited technical support in forming, operating, or converting existing businesses to a worker cooperative; difficulties obtaining financing for cooperative formation or conversion; and high startup costs (permit fees, license fees, lease rates) that many small businesses experience in California.  Staff will work to assist in connecting worker cooperatives to the necessary resources to alleviate some of these barriers.  The City will also take a proactive position to support legislation that reduces the cost of doing business for worker cooperatives, as well as supporting efforts to remove barriers, decrease unnecessary burden and regulations and assist in the streamlining of starting up a worker cooperative in Santa Ana.
     
  4. Promote knowledge and awareness of worker cooperatives as a local economic development strategy.  Staff will promote awareness of worker cooperatives as a business model, economic development strategy, and local wealth creation tool through the City’s website, flyers, and informational seminars.
     
  5. Develop City webpage identifying resources for cooperative start-ups and conversion.  The City’s Economic Development website will feature informational materials about worker cooperatives, including, but not limited to, resources for formation, conversion, financial resources, relevant local and regional events, and a reference list of worker cooperative federations, associations, and development organizations.
     
  6. Promote worker cooperative job opportunities at the City’s WORK Center.  City staff will proactively promote job opportunities for local worker cooperatives through the City’s workforce development job center.
     
  7. Support and promote the conversion of businesses into worker cooperatives. Staff will identify businesses that have been in the City over 25 years and provide information on the option of conversion to worker cooperatives for retiring business owners.  Staff will also jointly host workshops with local community stakeholders and experts on conversion.  Staff will assist in providing access to technical assistance and information for employees and business owners seeking to convert existing businesses into worker cooperatives.
     
  8. Submit annual report on worker cooperative development to the Community Development Agency Director for City Council. Staff will produce a report for the City Council as an update on the progress of worker cooperative development in the City. The data in the report can also be used to develop future strategies and identify future funding sources for continued worker cooperative support in Santa Ana.

 

QUESTIONS ABOUT WORKER COOPERATIVES? Please call Marc Morley or email mmorley@santa-ana.org for more information.