1. Current Budget

• 135 Members
• 161 Pledges
• $5/month/pledge
• Income
  • pledges: $805
  • members: $685

• Current Monthly Expenses

  • $969.85

• 'Monthly Deficit: $164.85' ($1.02/pledge, $1.22/member)

• 33 additional pledges needed to break even (59 additional members
  • without pledges)

1.1. Current Accumulated Deficit (up to October)

$136.30

2. Migration Expenses

• Server Hardware: ~$2000

  • PowerEdge 2970 + large raid

  • Console Server
  • Switch
• New Colocation: ~$700/month * 2
  • Actual cost pending
  • We would be carrying this in addition to peer1 for up to 60 days (ideally 30)

2.1. Migration Cost Per Member

2.1.1. Colocation

• Each month at both colos (($700 + $850) = $2250)
  • Pledges: $13.97
  • Members: $16.67

2.1.2. Hardware

• Per pledge: $14.82
• Per member: $12.42

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 December billing cycle

3.2. Short Term Increase

All numbers involving new setup are pending known colocation cost.

Assuming 161 pledges

• Adjusted to October Real Cost = $969.85
• Per pledge: $6.02
• No debt repayment / non-recurring costs adjustment

3.2.1. Deficit

October and November would run a deficit.

• October deficit: $164.85
• November deficit: $864.85

• Total: $1029'

This becomes a total migration deficit of ~$2000 + ~$1029 + $136.30 = ~$3165

3.2.2. End Peer1 Dec 1

• December real cost:$811.60
• December income (161 pledges @ $7): $1127
• Surplus: ~$315
  • Per Pledge: $1.85
  • Per Member: $2.34

• Remaining deficit Mar 1: '$2220'

• Entire deficit paid off ~7 months later (assuming zero or slow expansion)

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: $811.60
  • Per member: $2.71 (3)
• Expansion fund: $1
• Total cost: $4
• Monthly surplus: $388.40 (or $688.40 with $2 expansion fund)

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?