1. Current Budget

• 134 Members
• 160 Pledges
• $5/month/pledge
• Income
  • pledges: $800
  • members: $680

• Current Monthly Expenses

  • $969.85

• 'Deficit: $169.85' ($1.06/pledge, $1.26/member)

• 34 additional pledges needed to break even (60 additional members
  • without pledges)

1.1. Questions

What is our accumulated peer1 deficit?

2. Migration Expenses

• Server Hardware: $3500
• New Colocation: ~$600/month * 2
  • Actual cost pending
  • We would be carrying this in addition to peer1 for up to 60 days

2.1. Migration Cost Per Member

• 2 months at both colos
  • Pledges: $29.38
  • Members: $35.07
• 1 month at both colos
  • Pledges: $25.64
  • Members: $30.60

3. Dues Restructuring

3.1. Overview

• Dues pegged to ceiling(recurring expenses / pledges)

• The board would be authorized to add $0-$3 per share for projected
  • non-recurring costs and debts
• Dues would be adjusted quarterly based on new costs and member counts
• Plan would be enacted for November billing cycle

3.2. Short Term Increase

All numbers involving new setup are pending known colocation cost.

Assuming 160 pledges

• Adjusted to November Real Cost = ~$1561.60
  • Pending known value for new colocation
• Per pledge: $9.76 ($10)
• Surplus: ~$38.40 (too insignificant to count)
• No debt repayment / non-recurring costs adjustment

3.2.1. End Peer1 Dec 1

• December real cost:$711.60
• Surplus: ~$888.40
  • Per Pledge: $5.55
  • Per Member: $6.63
• Remaining migration debt Feb 1: $2323.20

3.3. Dues adjusted Feb 1

• Adjusted to February real costs: $711.60
  • Per pledge: $4.45 ($5)
  • Per member: $5.31 ($6)
• Additional debt-repayment surcharge: $2
• Surplus (@ $7/share)
  • With pledges: $408.40
  • Without pledges: $226.40
• Remaining migration debt May 1: $1644.00
  • Not terrible; completely paid off by the end of 2010

4. Numbers Look Better With New Members

Each new member joining before quarterly adjustment is paying 100% toward migration debt / expansion funding.

New members therefore essentially pay for the capacity expansion required to handle them.

5. Long Term Reduction

With 300 members:

• Projected real costs: $711.60
  • Per member: $2.37 (3)
• Expansion fund: $1
• Total cost: $4
• Monthly surplus: $488.40

This is feasible within a year given our new hardware.

6. Related Ideas

6.1. Join National Cooperatives Bank

A while ago we looked at leaving Wells Fargo and joining the NCB, but the discussion died with no resolution. Do we qualify to have a business account with NCB? If we do we might qualify for an interest bearing checking account.

I can't find anything to indicate that we wouldn't be eligible for a business account with the NCB. [http://www.ncb.coop/uploadedFiles/Applications_and_Forms/Commercial/Business%20Deposit%20Account%20Application.pdf] is the NCB application for a business deposit account. Interest-bearing checking accounts are available to nonprofits, but "some nonprofit organizations may not qualify." The website has phone numbers for banking and nonprofit specialists, as well as a general contact form.

6.2. Moving Member Deposits to an Interest Bearing Account

We could open an account for storing member deposits into a savings or similar type of account and perhaps make a small amount of interest. Member deposits tend to not be touched often (if needed only the lower 2/3 of the balance could be stored in the interest bearing account), and so would be ideal for storing this way. What are the rules for HCoop as a non-profit corporation with regard to interest? Do we have to disburse gained interest to member balances, or could it instead go into a general use fund?