Building Local Economies Massachusetts Downtown Initiative Workshop May 12,

”... production from local resources for local needs is the most rational way of economic life,while dependence on imports from afar and the consequent need to produce for export to unknown and distant peoples is highly uneconomic and justifiable only in exceptional cases and on a small scale.” from Small Is Beautiful E. F. Schumacher

Citizen Based Tools If we accept Schumacher’s argument, what can citizens do to shape local production and build economies of permanence? Share risk with producers. –Community Supported Agriculture –Affordable Access to Land –Social Entrepreneur Local Currencies elegant tool, according to Jane Jacobs, to build diverse regional economies –US economy originally built on system of multiple local currencies –National currencies drain wealth from rural areas and empower government to raise funds for non-productive purposes

Issuing a Local Currency Classic way to issue money is through productive loans. Organizational structure of issuer –Non-profit –Regionally based –Open Membership –Democratically run The question of backing Exchange rate with national currency Redemption Strategy for launching--convenience for businesses

Place-Based Money BerkShares are a local currency for Southern Berkshire region of Massachusetts (population 19,000) Defines a trading area, an economic footprint Distinguishes the local businesses that accept the currency from those that do not Builds loyalty between those local businesses and the citizens of that place in which the currency circulates Encourages community self-reliance as purchase choices are connected to responsibility for the health and wellbeing of community

Designing BerkShares

Pittsfield Co-op, Great Barrington Berkshire Bank, Great Barrington (Main Street & Stockbridge road), Stockbridge, Lee, West Stockbridge, and Sheffield Branches Lee Bank, Great Barrington, Stockbridge, and Lee Salisbury Bank, Egremont & Sheffield Branches Bank Participation--BerkShares are placed in circulation when citizens exchange federal dollars for BerkShares at any of thirteen participating bank locations: Lenox National Bank Main Street, Lenox

BerkShares Exchange BerkShares can be exchanged for federal dollars at a rate of $0.95 / BerkShare. One BerkShare can be exchanged for $0.95; ten BerkShares for $9.50; and one hundred BerkShares for $95.00.

400 plus businesses formally accept BerkShares in trade. Another 200 businesses and cottage industries informally accept BerkShares on occasion. People with BerkShares in hand will look for the BerkShares sticker to identify where they can spend their BerkShares. They may also have a wallet sized directory, or may look online at to view a complete list of participating businesses.

Note the wording “Some Restrictions may Apply” Each business may add restrictions to accepting BerkShares as needed to make the program work to their greatest benefit. Any restrictions should be made clear to customers.

Slow Money Advantages and Challenges

Future Plans BerkShare checking accounts and debit cards Expand to central and north Berkshire County Stable Local Currency Loans for import-replacement businesses Social Entrepreneurs developing business plans

Further Questions? BerkShares website, Additional background material on local currencies at

“A good community, as we know, insures itself by trust, by good faith and good will, by mutual help, A good community, in other words, is a good local economy.” -Wendell Berry