Community-owned stores in Aspen?
ASPEN ” In order to ensure that locals can buy basic necessities such as underwear and pharmaceuticals in Aspen, elected leaders are considering allowing the community to share in the ownership of locally serving businesses with the government’s help.
The concept is called community-owned stores, or community enterprises; the enterprises are becoming more popular in small towns around the country. Community enterprises involve direct investment in, and ownership of, the business by residents.
For the past year, the City Council has knocked around ideas on how to preserve locally serving businesses as rents get more expensive and high-end retail stores replace mom-and-pop shops, as well as longtime bars and restaurants.
“We’ve seen enough places turn over, and the prices become too high to run a day-to-day place of necessity,” said Ben Gagnon, City Hall’s special projects planner. “It would be irresponsible to not plan for that to happen more.”
Mark White, a Kansas City-based urban planning consultant, on Tuesday presented a host of options to the City Council, which supported the concept and asked City Hall planners to pursue the concept.
That will first require reaching out to store and building owners to find out their plans for the future so city officials can map out a succession plan for the business and property. The discussion will center around suggestions to maintain the use.
The space would need to be secured either through a direct purchase or a land trust model, which involves a private nonprofit corporation that holds the land and provides secured affordable access.
The city government could then purchase the property and offer a reduced rate to a potential business owner as long as he or she agrees to a specific use, like a drug store or another essential need of the community.
Or, residents could establish a community corporation, capitalized by selling shares to locals who would collectively own the business.
The model has been successful in dozens of cities throughout the United States. In Powell, Wyo., residents banded together after the community lost its department store, leaving only a big box store 25 miles away in Cody as an option.
The community formed a board, filed papers with the state to offer stock in Powell Mercantile. Shares were offered at $500 and the enterprise sold 800 shares, generating about $400,000 in capital.
Powell residents are shareholders, who meet periodically to vote on store issues and forego dividends and appreciation in exchange for providing a city asset.
The community-owned Powell Mercantile has turned a profit for five years and doubled in size.
The concept is similar to the Green Packers, which is a business corporation whose shares are publicly traded and owned principally by its fans. The entity is a publicly owned, nonprofit corporation that offers no dividends or profits to its shareholders.
In other communities, including Madison, Wis., residents formed the Willey Street Co-op to provide food at affordable prices. The co-op priced its shares at $56. In 2007, the co-op generated $17 million in sales.
The Aspen city government could play a role in a community enterprise by becoming a shareholder, buy down part of the land or offer grants to businesses to offset startup and maintenance costs.
Community-owned businesses involves the community providing start-up capital for a company that is owned and operated by a local entrepreneur.
“The entity can take various forms,” White told the council. “You have to decide what kind entity it will be, and that’s a big policy decision.”
Recognizing that prices are higher in Aspen than most places in the country, the City Council will consider ways of generating revenue to help potential businesses succeed, which may involve purchasing land or buildings downtown.
One revenue generator could be an excise tax on residential redevelopment, or an in-lieu fee for developers. Other ways to ensure that locally serving businesses remain is to require new development to offer low rents on a portion of the site.
“In a certain sense, you are exercising your police power to protect day-to-day services,” Gagnon told the council.
City Councilman Jack Johnson characterized the entire concept as “fascinating” and one of the best solutions to combat what the community has been saying is a growing problem for more than a decade.
“It’s the most interesting thing I’ve heard yet,” he said.
City officials plan to reach out to longtime business owners to see what their long-range plans are. City Council members said they believe there are property owners and entrepreneurs who might be interested because they are philanthropic, and care about the community and want to a leave a legacy.
Planners will then find potential space in the downtown area and set up a model that incorporates one or more of the options presented to the council. It will then be taken to the public for a community-wide discussion.
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