Neighborhood Bonds are one way to raise community money for something like a food co-op.

Having  grown up in Ft.Collins a recent article about a Food Co-op expansion in Ft. Collins, Colorado caught my eye. What I found extremely interesting is how they are looking to finance the new project. The Co-op is currently located at 250 E. Mountain Avenue and has limited parking and room to grow. To service the needs of its member-owners, the co-op must triple its retail space. To do this, they are considering a new downtown site with enough room to accommodate its expansion and long sought-after community market and kitchen. The Co-op is looking at fulfilling a vision conceived by the Downtown Development Authority for a community marketplace and kitchen.

A feasibility study released in 2011 showed the desire for a project anchored by both the co-op and a community marketplace that could provide space for a year-round farmers market, kitchen and demonstration area. Now, the co-op might be able to take the lead on bringing that project to fruition. The co-op is eyeing a new method of funding that would allow the community to buy bonds for as little as $200. A Co-op in Madison, Wisconsin used this financing tool to help raise $600,000 in 60 days. I have never heard of this type of method of fund raising in the cooperative space, but can see how it could be very effective.

When I think of bonds, I either think of my 101.5 year grandfather who just passed away, and was a big fan of Treasury Bonds, as they provided a low risk, and low interest bearing investment. On the flip side, my brother works in the commercial real-estate field and has educated me a bit on how mortgages are packaged and sold as bonds to investors. With these two examples, I would be curious to learn more about how exactly the Neighborhood Bond is structured and presented to the community of investors and stakeholders?