|RE: Equitable distribution of costs||<– Date –> <– Thread –>|
|From: Rob Sandelin (robsanmicrosoft.com)|
|Date: Thu, 27 Jan 94 09:35:09 PST|
Another point of view is to ask, why should costs be equitable? In most cases the people who come in early take all the financial risks, put in most of the effort and do much of the vision. Why shouldn't they be rewarded for that with a price advantage? Or, to put it the other way, why would anyone want to take the risks and make the effort if they can wait and buy in when everything is figured out, at the same cost without any of the effort? All four built out groups in our area (Winslow, Puget Ridge, Sharingwood and Talking Circle) all had trouble getting people on board when there was lots of risk and design and other work to do, but had a large influx as the project neared, or was close to finalizing. At Sharingwood Cohousing, the founders paid cost for the lots ($20,000). The last lot sold was at $43,000. Some of that difference in cost was reflected in the development costs accrued but also some of that difference went into the common account of the group, and for those who bought an extra lot to give the group development capital when it was desparately needed, that difference is profit for them. The founders took all the financial risks, did all the development efforts and got essentially value returned for that work and risk in the form of cheaper lots. Now that all the work in our first phase is largely done, its amazing how many people we have who want to join the first phase and how none of those same people are interested in doing the development work in the second phase. That's why we are selling the first three memberships in the second phase (first phase is sold out) at a reduced rate and the rest of the memberships for $8,000 more. Rob Sandelin Sharingwood Cohousing Puget Sound Cohousing Network ---------- From: "Fred H. Olson WB0YQM" <netmail!fholson [at] maroon.tc.umn.edu> To: Rob Sandelin Subject: RE: Equitable distribution of costs Date: Wednesday, January 26, 1994 8:19AM I've been reviewing the messages from the last month about assessing member fees. I plan to use them as the basis of an article for our local newsletter. Note that I have not been a part of a cohousing core group that has gotten so far as raising significant amounts of money for development costs. The scheme I currently like is similar to New View's but in thinking about it I think my wifeand I have had an insight that I'd like your comments on. Suppose: Money would be raised to cover early development costs as they arise from member households in some equitable way - per household maybe with an adjustment for household size. Records would be kept of who paid what and would later be counted toward house purchase. Costs would be added to the cost of the houses and common space shares. Thus when the community is completed the development costs are paid for in proportion to house cost. But if costs are eventually in proportion to house cost what difference does it make how members raise this money as long as enough money can be raised? Why, for example, not essentially borrow from members who have liquid assets that they can essentially prepay toward their house? Note the case of the community that fails and everyone looses the money they have put in so far (no post failure transfers). In this case people would lose in proportion to the fee assessment formula. Thus an equitable fee assessment formula essentially spreads the risk equitably. It also enforces a level of monetary commitment among members. Similarly, I'm inclined toward keeping a record of hours worked but I'm also sympathetic to arguments about individual circumstances. The group has the potential to take these into account in enforcement. Keeping track would allow differences in time to be open knowledge and exert some peer pressure for members to do what they can rather than a source of private resentment. Fred Olson Minneapolis,MN Seward Cohousing Group *and* fholson [at] uci.com Anderson Lane Core Group COHOUSING-L sysop Hopefully one of them will get built!
Results generated by Tiger Technologies Web hosting using MHonArc.