Re: investment -- who says it has to be equal?
From: David L. Mandel (75407.2361compuserve.com)
Date: Tue, 14 Feb 95 03:02 CST
In reply to the many who've been debating what formula to use for determining 
the investment everyone's required to make and particularly Rob's comment that
the seriousness of a group should be judged by the number of people who have 
invested $5,000 or more....

Here's a very different mind-set from Southside Park Cohousing in Sacramento: 
We set out from the start as a very mixed-income group. It was what we wanted,
what the city wanted for the very low-income, downtown neighborhood our site 
is in, and especially, it was the reality of who we were.

At the point we got serious and had to raise significant funds, we set as 
goals that members who could should invest 10 percent of their projected unit 
costs or 5 percent for low-income members. Anything over those amounts got 
preferred return at a higher rate (much higher, it turns out, since there's 
not enough left in the pot to pay more than a pittance of a return on the 10 
or 5 percent). But it was made very clear from the start that this was 
voluntary, set by people's comfort levels and most of all by their resources. 
So we had a couple members who before construction was far along invested far 
more than the suggested amount and a few people who invested far less. And 
that was perfectly OK for us. In the end, low-income buyers were able to get 
loans with only 3 percent down and for some, even that was partly borrowed 
(don't tell the bank). Whatever folks had in the pot was credited toward down 
payment and closing costs, and when the last units sold (the last one closed 
last week, finally; Yaayy!!) everyone got principal back and some return. 

We also sought and raised more than $100,000 from outsiders, mostly parents 
and friends, and with help from the city, we were able to leverage a very 
conservative construction loan made when no one was making construction loans.
Lots of crises and some rip-offs along the way -- but that's another story. 
For this posting, we managed to raise enough and get it built without imposing
minimum amounts, and a few of our members who had virtually no money proved 
just as committed and hard-working as those who invested lots.

Anyone who wants more details about how we did some of these things, please 
feel free to contact me directly.
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