p i h s r e n w O l a c o L f o s d r a w e R Rural COOPERATIVES COOPERATIVES USDA / Rural Development Development Rural / USDA November/December 2008 November/December Page 4 Page Commentary Co-ops and the future of rural America

he future for rural America is a bright one, channel investments into worthwhile projects. In order to studded with new economic opportunities. fully capitalize on the new demand, the traditional cooperative Many of those opportunities stem from the model is being complemented by other concepts, such as T rapid development of renewable energy and “new-generation” cooperatives which provide greater liquidity other value-added products from basic through tradable delivery rights. These co-ops also promote agricultural materials, using both proven and formation of partnerships with outside entities and other innovative, cutting-edge technologies. provisions that enable greater outside investment, along with While we have seen a significant increase in research, transparency, liquidity, transferability of ownership interest development and production of value-added products in and equal appreciation of asset value. recent years, the best is yet to come. New concepts are Where should rural Americans turn for the capital needed evolving at a rapidly escalating pace. Promising new to buy into these opportunities? An obvious investment source technologies are on the drawing board, while others are just in for agricultural producers is their farm equity, which now the conceptual stage. exceeds $2 trillion. By leveraging the value of their land, But the reality is that all will require investment capital. producers can raise the investment capital they need to America’s cooperatives have a unique opportunity to play a participate in the new rural economy, not only for energy significant role in developing this growing economic sector. development but for other value-added ventures that use new In the energy arena — because of site selection and technologies — such as broadband Internet — to market feedstock requirements — wind, solar, ethanol, biodiesel and processed goods directly to consumers. Responsible and geothermal are primarily rural resources. Expansion of this transparent leveraging of land and other assets will assist in sector offers the opportunity to harvest an increasing amount providing the equity needed to develop new high-value of energy from renewable, inexhaustible sources. opportunities which are of greater value than basic Vast stretches of the American rural landscape are ripe for commodities. solar projects. Wind energy is emerging as a potentially What does this mean for the 60 million people who call significant source of electricity in much of the country. rural America home? It presents them with the unprecedented Biofuels derived from corn and soybeans (and coming soon chance to generate wealth, job opportunities and a self- from cellulosic sources, such as switchgrass) augment energy supporting rural economy that provides a high standard of refined from petroleum. There is no question that renewable living. But in order for that to happen, a large subset of rural sources of power will continue to play an expanding role in residents will need the opportunity to participate — to America’s energy picture for generations to come. become owner-investors, providing the capital to encourage Other exciting value-added opportunities are developing as development and then reaping a share of the profits to be well, ranging from agri-tourism to production of foodstuffs realized from the sale of high-value products. that are in growing demand by consumers. Cooperatives are one potential investment vehicle available A good example of an investor-owned entity is the to rural Americans, but they’re not the only vehicle. To Plymouth Energy Ethanol Plant and Plymouth Oil in Merrill, maintain and increase market share in a rapidly changing rural Iowa. Now under construction, the ethanol plant will soon environment, cooperative managers and members need to be produce 50 million gallons of ethanol from corn each year. flexible, adaptable and willing to re-examine their business The plant has more than 300 local investors, mostly farmers. models and change them as needed. Located near the ethanol plant is Plymouth Oil, which will In the dynamic marketplace that is rural America, use byproducts from ethanol production to manufacture about investment will occur, whether through cooperatives or other 80 tons of corn oil per day for human consumption. It will sources. In that light, it is important that our cooperatives — also produce feedstock for cattle. Most of the corn will come which have served rural America for so long — position from fields within 60 miles of the two plants. The oil plant themselves to participate fully in the new rural economy. This was financed with a bank loan guaranteed by USDA Rural will benefit not just the members, but will improve the Development. economic vitality of rural America as a whole. As consumer demand grows for high-value products, such as energy and processed food, America’s cooperatives must — By Thomas Dorr, Under Secretary serve not just as an outlet for production, but as vehicles to USDA Rural Development ■

2 November/December / Rural Cooperatives Rural November/DecemberCOOPERATIVES 2008 Volume 75 Number 6 FEATURES 4 Rewards of Ownership Community-based renewable energy projects can produce big benefits By Julie Curti and Justin Goetz

10 Carbon Credits for Farmers Rural Cooperatives (1088-8845) is published p. 4 bimonthly by USDA Rural Development, 1400 Co-ops can play role for members managing dairy waste with digesters Independence Ave. SW, Stop 0705, Washington, DC. By K. Charles Ling & Carolyn Liebrand 20250-0705.

The Secretary of Agriculture has determined that 13 Vermont dairy farm turns manure into publication of this periodical is necessary in the transaction of public business required by law of renewable energy the Department. Periodicals postage paid at By Lisa Halvorsen Washington, DC. and additional mailing offices. p. 13 Copies may be obtained from the Superintendent of Documents, Government Printing Office, 16 Grain industry must evolve, adjust to a new Washington, DC, 20402, at $23 per year. Postmaster: market paradigm send address change to: Rural Cooperatives, USDA/RBS, Stop 3255, Wash., DC 20250-3255. Maintaining strong capital base critical for country elevators By Phil DiPofi Mention in Rural Cooperatives of company and brand names does not signify endorsement over other companies’ products and services. p. 16 18 Co-ops ring up additional $14 billion in sales Unless otherwise stated, contents of this publication via other ownership structures are not copyrighted and may be reprinted freely. For By E. Eldon Eversull noncopyrighted articles, mention of source will be appreciated but is not required.

The U.S. Department of Agriculture (USDA) prohibits 20 Sky’s the Limit! discrimination in all its programs and activities on Housing co-op opens doors for first-time ownership the basis of race, color, national origin, age, disabili- By Dan Campbell ty, and where applicable, sex, marital status, familial p. 20 status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or 26 CCA salutes top co-op communicators because all or part of an individual’s income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons 28 CDF’s multi-pronged efforts support co-op with disabilities who require alternative means for communication of program information (Braille, mission in America and abroad large print, audiotape, etc.) should contact USDA’s By Steven Thomas TARGET Center at (202) 720-2600 (voice and TDD). To file a complaint of discrimination, write to USDA, Director, Office of Civil Rights, 1400 Independence DEPARTMENTS Avenue, S.W., Washington, D.C. 20250-9410, or call (800) 795-3272 (voice), or (202) 720-6382 (TDD). USDA 2 COMMENTARY is an equal opportunity provider and employer. 8 FOCUS ON

Ed Schafer, Secretary of Agriculture 14 CO-OP DEVELOPMENT ACTION 22 UTILITY CO-OP CONNECTION Thomas C. Dorr, Under Secretary, USDA Rural Development 24 MANAGEMENT TIP

Dan Campbell, Editor 30 NEWSLINE 37 ANNUAL ARTICLE INDEX Vision Integrated Marketing/KOTA, Design

Have a cooperative-related question? Call (202) 720-6483, or On the Cover: Fax (202) 720-4641 On the cover: Wind turbine installation was a round-the-clock job at This publication was printed with vegetable oil-based ink. the Westmill Wind Farm Cooperative, in Oxfordshire, England. The co- op is owned by more than 2,300 members of the local community. See page 4. Photo by Martin Phelps, courtesy Westmill Wind Farm Co-op

Rural Cooperatives / November/December 2008 3 Rewards of Ownership

Community-based renewable energy projects can produce big benefits

By Julie Curti and Justin Goetz

Editor’s note: Curti and Goetz are both Truman-Albright Fellows who have been working with the Cooperative Programs of USDA Rural Development.

ike many communities around the country, the school district in Wray, L Colo., faced a sharply growing electricity bill, feasibility study and carry out the renewable energy projects on tribal coupled with state budget cuts and project. lands and family farms in rural areas. declining student enrollment. To make The community rallied around the Since the company’s founding in 2000, up for the shortfall, in 2002 a vocational project, with donations, a bond project it has sold renewable energy credits and and agricultural technology teacher at and in-kind support providing the carbon offsets to businesses and the high school suggested a creative school district with funds for the 900- individuals. Revenue from these sales solution: build a wind turbine. killowatt (kW), 335-foot-tall turbine. are then used to finance renewable Not only would the turbine bring a An innovative company, NativeEnergy, energy projects. new source of revenue, but it also provided the final funding boost by “NativeEnergy is committed to would provide hands-on opportunities purchasing the carbon benefits the solving the climate crisis by helping for students to learn about renewable turbine has been generating since it indigenous groups and at-risk energy. After receiving approval from began turning in February of 2008. communities to build renewable energy the board of education, a citizen NativeEnergy (www.native projects as a meaningful step toward committee formed to conduct a energy.com) funds community-based developing sustainable economies in

4 November/December / Rural Cooperatives Rewards of Ownership

These wind turbines, part of the Westmill Wind Farm Cooperative, provide electricity to 2,500 homes. Photo by Martin Phelps. Above, residents of Ashland, Ore., can purchase a solar panel (or a portion of one) on this city-owned building to receive a credit on their electrical bill. Photos courtesy Westmill Wind Farm and city of Ashland

Boulder Creek Hydro Project, which is time. owned by the Confederated Salish and The city of Ashland, Ore., took Kootenai Tribes on the Flathead another approach to community-based Reservation in Montana. renewable energy. In July 2008, the city-owned electric utility installed a Models for community 63.5 kW community solar electric energy projects system on a city facility. Citizens can Many successful models exist for purchase a panel or portion of a solar rural communities to follow when panel, enabling them to buy the output creating renewable energy cooperatives of the solar system for 20 years and or partnerships with private enterprise. receive a credit on their electric bill for harmony with core cultural values,” says In Nebraska, the town of Plainview the amount of renewable electricity Tom Boucher, NativeEnergy president was beginning to fade economically. their panels have generated. and CEO. Since the town of 1,350 is in the center Under this system, residents who NativeEnergy has collaborated with of a large corn-producing area, either don’t have the capital to invest in rural communities on 15 projects to residents began thinking about the a solar system for their home or date. In 2006, it provided funding by potential for ethanol production. After business, or who do not have the solar purchasing expected carbon emission conducting a resource assessment, the exposure, can still use renewable energy. reductions from the member-owned town pooled millions of dollars to build In addition, the city has a cooperative Alaska Village Electric Cooperative a 25-million-gallon, community-owned marketing partnership — called Green (www.avec.org/about-us.php), which ethanol facility. The plant has been Tags (www.b-e-f.org/offsets/ashland owns and operates several wind turbine operating for four years, and has .cfm) — with the Bonneville projects serving 53 remote villages and generated $130,000 in property tax Environmental Foundation. Under this tribal communities in Alaska. Another revenue and $30 million in added program, citizens can purchase carbon recent effort supports the low-impact income to local farmers during that offsets. For every green tag purchased,

Rural Cooperatives / November/December 2008 5 the city receives funds to Students from Rosebud Elementary School tour an Alaska into their vision for the invest in local renewable Village Electric Cooperative wind turbine. Photo courtesy future. In short, if they energy programs. Intertribal Council on Utility Policy haven’t already done so, Many countries, from communities that are India to South Africa, considering a renewable have started successful energy project should community-based renewable energy community-owned and built wind first complete a community projects and co-ops. The United cooperative in the United Kingdom. development strategic planning process. Kingdom, for example, is home to a “Westmill Co-op is a superb They also must ask how the proposed number of thriving community-owned example of what individuals intent on project will help the community achieve cooperative wind farms clustered making a difference can achieve its vision. around a dozen communities together,” says co-op director and local (www.energy4all.co.uk). farmer Adam Twine. “It’s very exciting Strategic planning process In these co-ops, community that after such a long struggle the There are four phases that comprise members purchase a portion of a wind turbines are now up and generating a community development strategic farm and receive an annual dividend on green power. I hope Westmill will planning process. They are (in order): its profits. Community ownership inspire other communities to take • Community assessment — community empowers local decision-making and similar initiatives in their own locality leaders and citizens collectively assess maximizes the local economic benefits and in their own way.” local resources and the strengths, of renewable energy projects, as more From Wray to Plainview, weaknesses, opportunities and threats money stays in the community than community-based renewable energy facing the community. when outside owners are involved. projects have already positively • Strategic planning — community impacted many rural areas. And this members use results of the assessment Community-cooperative trend has the potential to continue: to determine where the community wind farm analysts predict that in the next 20 wants to go (the vision) and how it can One successful community-based years, we will see upward of $1 trillion get there (a strategic plan). wind cooperative in the United invested in renewable energy projects. • Implementation and benchmarking — Kingdom, Westmill Wind Farm Yet, it is important to realize that the strategic plan is implemented; the Cooperative, is 100 percent locally every renewable energy project will not community takes action on specific owned by more than 2,300 co-op necessarily provide net benefits to its strategies and measures progress. members (www.westmill.coop). Since community. To ensure that a renewable • Evaluation — the overall community February 2008, the project has been energy project is beneficial, it is critical development process is judged based using five wind turbines that produce for that community to be actively upon results produced. electricity for 2,500 area households. involved in planning for a project and Ultimately, the strategic planning In addition to providing a source of to think and plan beyond just the process revolves around a community- clean energy and adding to the local feasibility study. based assessment of resources and revenue stream, Westmill Co-op Communities need to consider the opportunities, planning and the promotes energy efficiency and broad range of a project’s economic, implementation of the plan. The conservation measures in the social and environmental impact and community determines the objectives community. It is the largest integrate the project as fully as possible and timeline of the process, with citizen

6 November/December / Rural Cooperatives input and feedback The village of Kasigluk, Alaska, (seen here from the air) is the project provided a gathered every step of the getting electricity from wind turbines operated by a member- platform to engage young way through town hall owned utility cooperative. Photo courtesy Alaska Village Electric people in cutting-edge meetings, focus groups Cooperative technology education. and outreach to Ultimately, each community organizations. community needs to This input and feedback from direct economic advantages from inputs decide what kind of renewable energy community members is key to the final into the project and indirect economic projects will be best for its needs and decisions. Typically, overall authority advantages in terms of added businesses what kind of projects best fit its vision and ultimate decision-making are in the and industries that will prosper from for the future. Engaging in a hands of a steering committee made up money that is re-infused into the local community development strategic of local stakeholders, leaders and economy by the project. planning process and focusing on development experts who represent a “The success of homegrown community-driven models will help to diverse cross-section of the community. renewable energy lies in two key ensure a renewable energy project’s By completing this process, a findings,” Farrell says. “Very large success. community will be in a much better renewable power plants and It is also important to realize that place to understand its priorities and biorefineries cannot be locally owned successful renewable energy projects needs, and to make strategic choices past a certain size because the capital don’t necessarily happen quickly. The about what kinds of renewable energy costs are beyond the community’s wind turbine project in Wray took projects will best enable it to move in wherewithal. But the rewards of local more than six years to complete. In the its desired direction. ownership are significant, delivering case of the Westmill Wind Co-op, the anywhere from 25 to 300 percent more idea of a wind farm was first raised 15 Benefits of local ownership economic impact to rural communities years ago and ultimately took four years Among the most important questions than from identically sized absentee- of community planning and action to for a community to consider are those owned facilities.” bring to completion. of ownership and scale. John Farrell, a There are further tangible In some cases, where community- research associate at the Institute for advantages to community-driven driven strategic planning was not used, Local Self-Reliance, stresses that: “The renewable energy projects. Strategic rural renewable energy projects have key to sustainable rural economic planning for renewable energy brings a failed to be economically viable. But development and the renewable energy community together and allows its communities that are actively involved future of America is a series of modest citizens to focus positively on their in assessing their needs and planning sized, locally owned wind farms, solar future. It also gives a community a for their future can safeguard the plants and biofuel refineries.” direct stake in the renewable energy investments they put into renewable Locally owned renewable energy project. energy projects and ensure a bright projects are more likely to use locally- Benefits can also come in terms of future for their community, on their obtained inputs, profits are more likely working towards energy independence own terms. ■ to circulate locally and the community and improving the local environment by has an increased chance of retaining using renewable energy sources. A higher-paying management jobs renewable energy project could even be associated with the project. There are a source of tourism revenue. In Wray,

Rural Cooperatives / November/December 2008 7 Focus On Craftsmanship paired with technology as Bongards’ celebrates centennial

Bongard’s Creameries is celebrating 100 years of making prize-winning cheeses, including Champion Cheddar Awards in 2004 and 2007. Photos courtesy Bongard’s

By Anne Todd making business. The co-op made from butter and whey powder to cheese USDA Rural Development natural cheese for 30 years, and curds. Bongards’ has 490 members, and subsequently expanded production about 300 to 400 more if dairy ongards’ Creameries, a again to include processed cheese. producers who supply the co-op’s farmer-owned “feeder” plants are factored in. creamery co-op, was Traditional crafts still practiced In 2003, the co-op purchased a B launched in 1908 in the Today, Bongards’ still makes one of building from Land O’Lakes and town of Bongards, the country’s most distinctive cheeses moved its natural cheese production to Minn., when 72 area dairymen banded using the same traditional craftsmanship Perham, Minn. This was a more cost- together to market their milk. Their that the original members brought to effective option than upgrading the goals were straightforward: to produce Bongards’ starting in the 1900s. Those facility in Bongards. fresh, wholesome and great-tasting skills, now paired with 21st century The Perham plant makes all of the dairy products at a price that could technology, produce quality cheese with natural cheese and has total control sustain their livelihood. a distinctive taste. over its quality and consistency, day in Each member invested $25 a share in In the last 10 years alone, the co-op and day out. High-quality whey powder the co-op. They transported milk to has received almost a dozen awards for is also produced at the Perham location. Bongards’ in cans and trucks. Onsite, its cheddar cheese, including Champion In an average year, Perham produces they sold milk and cream and made Cheddar awards in 2004 and 2007, and millions of pounds of both natural butter. international recognition in 2005 at the cheese and whey powder. In 1942, Bongards’ Creameries British Empire Cheese Show. The Bongards site includes the expanded to include cheese-making Bongards’ Creameries currently plant for processed cheeses, a facilities, and entered into the cheese- manufactures dozens of dairy products, warehouse and a recently expanded and

8 November/December / Rural Cooperatives upgraded retail outlet. build on its success in the dairy industry while Private label focus making the Bongards’ site The majority of a destination for travelers. Bongards’ products are The co-op is now selling sold to private labels. sandwiches and ice cream However, Bongards’ name at its retail store, in brand products are sold addition to their cheese online on its website, at the and milk products. It is retail store at Bongards’ also adding a picnic area, main facility and at local and even moving the giant stores in the Upper Bongards’ cow across the Midwest. street to encourage Selling to private labels travelers to visit. has allowed Bongards’ Being able to use so much of the “We want to make it a members’ to focus on their product milk trucked into Bongards’ facilities is country stop,” says Grove. rather than on their competitors in the a big key to the co-op’s success. For more information about dairy industry. “We’re large enough to Bongards’ adds value to that milk Bongards’ Creameries, visit: serve our customers, yet small enough throughout the processing cycle, and www.bongards.com, to be responsive to their needs,” says isn’t dependant on outside Or contact General Manager Keith Bongards’ Creameries General commodities. Grove: [email protected], (952) Manager Keith Grove. In the future, Bongards’ hopes to 466-3514. ■

Strips of cheese head for the slicer, after which they will be wrapped for the co-op’s packs of individual slices (above).

Rural Cooperatives / November/December 2008 9 Carbon Credits for Farmers

Co-ops can play role for members managing dairy waste with digesters

By K. Charles Ling & Carolyn Liebrand continues to be used for consistency in greenhouse gas Agricultural Economists inventory reporting.) USDA Rural Development A business or organization may strive to reduce its contribution to global warming potential by taking steps to Editor’s note: This article is based on a forthcoming USDA report mitigate its direct or indirect greenhouse gas emissions. In on cooperative approaches for implementation of dairy manure case its effort is short of its own set mitigation goal (or cap), digesters. the firm may want to offset its shortfall by purchasing greenhouse gas reduction credits (“carbon credits”) from ethane from anaerobic digestion of dairy cow others who could provide credible net-reduction claims. manure may qualify for carbon credits if In this way, the firm disciplines itself by paying a financial collected and prevented from emitting into penalty for not meeting its own emissions reduction goal, the atmosphere. According to the Second while offering incentives to providers of offset credits, such as Assessment Report (1996) of the dairy farmers who capture methane from anaerobic digestion Intergovernmental Panel on Climate Change (IPCC), the of cow manure for use as fuel. This so-called “cap-and-trade” global warming potential of methane is equivalent to 21 system works to cut overall greenhouse gas emissions, which times that of carbon dioxide. This means the reduction of the are usually measured in carbon dioxide equivalent. emission of one metric ton of methane gas has the effect of reducing the amount of greenhouse gas emission equivalent Carbon credit trading systems to 21 metric tons of carbon dioxide. Various systems for buying and selling carbon credits are (Although IPCC has updated the global warming potential in varying stages of evolvement in the United States. These of methane to 23 carbon dioxide equivalent in its Third transactions could be made by private negotiations, or the Assessment Report (2001) and to 25 in the Fourth trading could be through formal exchange mechanisms. For Assessment Report (2007), 21 carbon dioxide equivalent example:

10 November/December / Rural Cooperatives allowances and Kyoto-based carbon credits to U.S. voluntary carbon credits, renewable energy credits and emissions allowances.” (Source: Green Exchange.) • Auction: The World Green Exchange, launched by the World Energy Exchange in February 2008, brings together buyers and sellers of carbon credits (among other green commodities) by holding auctions. The Exchange claims the auction process provides “a superior price discovery mechanism by enabling buyers and sellers to see what the market will command in real time, thus allowing the true forces of market competition to deliver the efficient pricing Sale of carbon credits result.” (Source: World Green Exchange.) Occasionally, the can at least partially Chicago Climate Exchange also conducts auctions for offset the cost of members to fulfill specific needs. treating manure in anaerobic digesters. Carbon credit trading standards Photo courtesy Just like all traded commodities, certain standards and University of Vermont specifications are required of carbon credits to facilitate the Cooperative Extension transaction. Some basic requirements of the underlying offset projects for carbon credits could be: • The methane gas that is captured from anaerobic digesters actually results in net reduction of carbon emissions, as compared to a certain base period. • The claim of carbon credits (i.e., net reduction of carbon emissions) is measurable and verifiable. • The ownership of the claim of carbon credits is clearly established. On the Chicago Climate Exchange, the closing price of Carbon Financial Instrument Vintage 2008 started the year at $1.90 per metric ton of carbon dioxide equivalent. It rose to peak at $7.40 at the end of May and the beginning of June, and then declined to $4 on July 15. The simple average for • Cash market: The Chicago Climate Exchange claims to be the first 137 trading days this year is $4.98, which amounts to “North America’s only — and the world’s first — global an extra income of about $25 per lactating cow per year for marketplace for integrating voluntary, legally binding dairy farmers who have carbon credits to sell. emissions reductions with emissions trading and offsets for This potential revenue will not fully cover the cost of all six greenhouse gases.” It was launched in 2003. (Source: installing anaerobic digesters. But the sale of carbon credits Chicago Climate Exchange.) Trading on this exchange is could at least partially offset the cost of animal waste similar to a commodity cash market. treatment. Under certain conditions, further credit also may • Futures market: The Chicago Climate Futures Exchange, a be available if the captured methane gas is used as fuel for wholly owned subsidiary of the Chicago Climate Exchange, electricity generation. “is a CFTC-designated contract market, which offers standardized and cleared futures contracts on emission Costs of carbon credit trading allowances and other environmental products.” (Source: There are costs involved in selling carbon credits to cover Chicago Climate Futures Exchange.) administrative and trading expenses. If the credits are sold The Green Exchange contracts began trading in March through an aggregator, the costs may include one or all the 2008. However, the Commodity Futures Trading following: Commission (CFTC)-regulated Green Exchange is expected • An aggregation fee charged by the aggregator, the going to launch during the first quarter of 2009. The Green rate of which is around 10 percent of the value of the carbon Exchange — a partnership between New York Mercantile credits, or about $2.50 per cow at the carbon credit value Exchange and Evolution Markets — claims that it “will be cited above. (More about aggregation is explained below.) the most globally integrated marketplace for the trading of • A trading fee, such as fees for registration and sales through environmental products. It will enable market participants to the Chicago Climate Exchange. For example, one aggregator gain exposure to environmental trading markets and manage quoted a trading fee of 20 cents per metric ton of carbon their risk via a diversified product slate, from Europe’s carbon dioxide equivalent, or $1 per cow per year.

Rural Cooperatives / November/December 2008 11 Graphic courtesy U.S. Environmental Protection Agency

• A project verification fee(s), if the anaerobic digester system lactating cows. However, only 595 dairy operations had that and the claim to the carbon credits need to be verified. many cows in 2007, representing just 3.5 percent of all U.S. Initial and annual verifications may be required. farms with more than 100 cows (USDA National Agricultural (For other examples, see: Michigan Conservation and Climate Statistics Service). Therefore, most dairy farms would need to Initiative; National Farmers Union; Iowa Farm Bureau.) register and trade through an aggregator.

Potential roles for cooperatives Co-op bargaining role As of November 2007, the U.S. Environmental Protection Through joint actions by members, a cooperative may be Agency (EPA) was aware of 95 anaerobic digester projects in able to bargain for lower marketing fees and/or higher 19 states. These digesters collectively reduce 20,892 metric returns. Depending on the needs of the members, tons of methane emissions per year (438,742 metric tons of cooperatives may play these roles in the marketplace of carbon dioxide-equivalent). carbon credits: The number of digesters in any region may not constitute • A co-op may engage a broker(s) to negotiate with carbon the kind of critical mass cooperatives would need in order to credit purchasers on prices and terms of trade. play a significant role (at this time) in marketing carbon • A co-op may act as a broker to negotiate with carbon credit credits. However, as a service to members, a dairy purchasers on prices and terms of trade. cooperative may want to inform them of the opportunity to • A co-op may engage an aggregator(s) to trade carbon generate returns by marketing carbon credits as an additional credits for members. benefit of treating waste with an anaerobic digester. Indeed, • A co-op may act as an aggregator if there is enough volume some cooperatives have already done so. of carbon credits generated by members. In essence, the If installations of anaerobic digesters on dairy farms function of an offset aggregator is similar to that of a milk- become more common, a critical mass of members may ask pool administrator, and dairy cooperatives are well their cooperative to pool and help market their carbon experienced in the pooling operations. credits. Pooling is most likely necessary to aggregate a large • A co-op may form a joint venture with other co-ops to enough volume for efficient marketing. provide aggregator services to members. The joint venture The reason for this is that a lactating cow weighing 1,376 would have a broader membership base to operate. pounds generates about 5 metric tons of carbon dioxide • Because verification of the anaerobic digester system’s equivalent of methane gas in a year through anaerobic impact on greenhouse gas reduction is usually required, a digestion of her manure. That amount is only about 20 cooperative may engage verifiers, or have verifiers on its percent of the size of a Chicago Climate Exchange’s Carbon field service staff to carry out the function. Financial Instrument contract (i.e., a contract represents 100 Thus, a cooperative could help its members maximize the metric tons of carbon dioxide equivalent). In other words, it benefit available from the sale of carbon credits by would take 20 to 25 cows a year to satisfy one single contract. negotiating the highest prices possible for the credits and The Chicago Climate Exchange defines aggregators as minimizing the costs associated with selling carbon credits. “entities that serve as the administrative representative, on Combined with other revenue streams associated with behalf of (greenhouse gas) offset project owners, of multiple byproducts of anaerobic digestion (avoided purchases and/or offset-generating projects.” The Exchange further stipulates sales of energy and of other byproducts), carbon credits could that “Offset projects involving less than 10,000 metric tons of contribute additional cash flow to enhance the economic CO2-equivalent per year should be registered and sold feasibility of digester projects. through an Offset Aggregator.” Editor’s note: References used for this article will be listed in the Offsetting 10,000 metric tons of carbon dioxide-equivalent forthcoming USDA research report upon which it is based. They by flaring methane produced from anaerobic digestion of are also available upon request from the authors: Charles.Ling@ dairy manure would require the waste of more than 2,000 wdc.usda.gov, or [email protected]. ■

12 November/December / Rural Cooperatives including pasture, crop and herd management programs; production records; conservation practices; contributions to the dairy industry and local community; and overall excellence in dairying. Glenn Rogers, a UVM Extension farm business management specialist based in St. Albans, notes that “this is a very clean, very well-kept operation. They do an outstanding job with their cows. They pay attention to detail, as indicated by their well-managed herd and quality crops going into the bunkers. “They also provide lots of outreach to the community with open houses for the public and other farmers to tour the farm and the methane digester system. An estimated 7,500 people from more Vermont dairy producers Brian Rowell (center) and Bill Rowell (right) check on the on- than 20 countries have toured the farm farm generator that produces electricity from a manure-to-methane gas digester on since 2006. That all played into the their Green Mountain Dairy Farm. Photo courtesy University of Vermont Cooperative judges’ decision to present the award to Extension this farm this year.”

Numbers needed to make By Lisa Halvorsen technologies to improve their herd system work average and increase revenue from their Green Mountain Dairy is one of the Editor’s note: The article was contributed by cows beyond what they get for their largest farms in Franklin County, the University of Vermont Cooperative milk. Installation of an anaerobic milking 900 cows and growing corn and Extension Service. methane digester system two years ago grass for haylage on 1,200 tillable acres enables them to convert manure on farms purchased in Sheldon, ike many top dairy produced on the farm into renewable Swanton and Highgate, as well as some producers in Vermont, energy. The Rowells milk 900 cows on leased land. Brian and Bill Rowell a twice daily milking schedule in a While the farm is regulated by the attribute their success double-15 milking parlor, shipping their Large Farm Operations Program of the in large part to their milk to the St. Albans Cooperative Vermont Agency of Agriculture, Food ability to think outside the box to Creamery. and Markets, Brian Rowell is quick to maximize available resources to For their innovative practices, this point out that this is a family farm. The maximize profits. Cow comfort ranks dairy farm has been named the 2008 numbers are what make it work high on their agenda, as does Vermont Dairy Farm of the Year. economically, he explains. “When we communicating effectively with their 15 University of Vermont (UVM) were in the planning stages 10 years ago fulltime employees and using Extension and the Vermont Dairy for this farm, we ran the numbers and sustainable practices to protect the Industry Association, in cooperation found we needed 800 cows. Having 400 environment and preserve the land for with the New England Green Pastures cows would have worked for us back future generations. Program, select one outstanding then, but to succeed, you need to make The owners of Green Mountain Vermont dairy operation for this it work for today and for tomorrow.” Dairy LLC, a 1,050-cow operation in prestigious award every year. Each “Every farm, be it big or small, in Sheldon, Vt., also embrace changing nominee is evaluated on several criteria continued on page 36

Rural Cooperatives / November/December 2008 13 Co-op Development Action Poultry industry explores ecological options to save energy

Rising fuel and other production costs are hitting poultry producers very hard. A USDA-funded study examined alternative fuel sources that might help reduce heating costs.

By Donna Uptagraff, have led to increased interest in to create heat. Funding for the study Cooperation Works! bioenergy systems for heating poultry was provided by a Cooperative houses. Development Grant from USDA Rural ike many agricultural Recognizing poultry producers’ Development. businesses, the poultry interest in lowering fossil fuel Fuel costs are the primary expense industry is experiencing consumption while also decreasing fuel for poultry growers, but changing a tough times. Surveys of costs, Winrock International’s Arkansas broiler house’s heating system involves poultry growers in Rural Enterprise Center engaged Jim costs as well. The initial assessment southern Missouri, northwest Arkansas Wimberly of BioEnergy Systems LLC found that typical poultry houses using and northeast Oklahoma indicate that to perform a review of biomass furnaces propane gas for heating require a propane costs and environmental issues for heating poultry houses in the savings of approximately $12,300 per are top concerns. Rising production northwest Arkansas region. Biomass year for a bioenergy system to achieve costs are making it difficult for growers furnaces burn renewable products, such break-even economic performance. to make a living. Soaring propane prices as wood, corn or litter pellets in order Fuel costs are not the only reason for

14 November/December / Rural Cooperatives poultry farmers to switch to bioenergy example, requires manual fuel loading modified to use readily available wood systems. Growers report a variety of and ash removal. Such furnaces have pellets as well. reasons for interest in the systems, been commercially available for many Litter-fired furnace systems are still including a preference for using a years and fuel is readily available. A in development, but were evaluated renewable fuel. corn-fired furnace system, on the other because of many positive features. Poultry industry explores Additionally, air emissions from hand, is available with automated fuel Litter-fired furnaces would turn waste biomass furnace systems are far below storage, handling and in-feed, but products into fuel and produce heat ecological options to save energy regulated levels, and numerous requires manual ash removal. with an extremely low-cost fuel source. environmental and economic benefits These furnace systems are While a raw litter-fired furnace system are associated with the dry heat nature commercially available, and more than was evaluated due to farmer interest, no of biomass-fired furnaces. 30 units have been installed at poultry such units are commercially available farms in the region during the past two despite numerous efforts and Study weighs efficiency of heating seasons. Recent fluctuations in investments during the past 25 years. five biomass fuels corn prices raise some questions about Likewise, pelletized litter-fired The Winrock study evaluated five the economic sustainability of this furnace systems are not commercially types of bioenergy systems. These model. available, but it is expected that some of furnaces use a variety of fuel sources, Wood pellet-fired furnace systems the commercially available corn-fired including: cordwood, corn, wood pellet, use a wood-based fuel with automated furnace systems could be modified to raw litter, and pelletized raw litter. fuel storage, handling and in-feed, with use litter-derived pellets. Wimberly Each system has its own particular manual ash removal. Several such units notes that the rate of ash production traits, and is in a different state of have been demonstrated in the past. would be significantly higher with development. Most of the commercially available litter-derived pellets than with corn or A cordwood-fired furnace, for corn-fired furnace systems can be wood pellets.

Primary conclusions After extensive examination of capital investment costs and operating costs of these five systems, the analyses indicate that: • Cordwood systems are economically feasible but labor-intensive. • Corn-fired systems are only feasible if cull corn or on-farm-produced corn can be obtained well below current market prices. • Wood pellet-fired systems are feasible, provided that assumed system efficiencies and service life are achieved. • Raw litter-fired systems would be very feasible if such systems can be designed and fabricated to meet all of the fundamental criteria set forth in the report. • Pelletized litter-fired systems are not feasible under the assumed conditions. For more information regarding the review, please contact Winrock International at www.winrock.org. To receive an electronic copy of the review, contact Marsha Burkhalter at [email protected]. ■

Rural Cooperatives / November/December 2008 15 By Phil DiPofi Executive Vice President, CoBank

t’s no secret that the GRAIN U.S. grain industry has undergone radical changes over the past INDUSTRY two years. Prices for corn, wheat and soybeans began MUST EVOLVE, climbing steeply in the fourth quarter of 2006 and climbed steadily to near historic highs earlier this year. Strong ADJUST international demand, a persistently weak dollar, biofuels production and capital from institutional investors all TO A NEW played a key role in that remarkable run-up. More recently, with the sudden MARKET onset of the global credit crisis and a strengthening dollar, grain prices have dropped sharply once again. Though PARADIGM they still remain well above historic norms, the latest downward swing further illustrates the volatile shifts that have come to punctuate the current commodities market. Traditionally, it has been rare to see corn prices move by much more than 50 cents over the course of a growing season. Today, Maintaining strong capital base price swings of more than $1.50 per bushel in a single month have occurred. critical for country elevators The same dynamic holds true for wheat and soybeans. Obviously, no one can predict the future with certainty. But it seems the reality is that we have entered an era in which significant volatility is now the market norm for grains. It’s also time for the grain industry — in particular the country grain elevator — to evolve in order to remain appropriate for this new business paradigm. Many country elevators — a linchpin of the U.S. grain handling and grain marketing system — experienced financial stress during the run-up in grain prices due to the huge new working capital requirements of their businesses. Much of that stress related to hedging positions taken in the futures market to mitigate price risk. In fact hedging, the very tool used to reduce price risk, has in some circumstances become a risk itself due to soaring capital requirements created

16 November/December / Rural Cooperatives by large and frequent price swings in workable when prices soar. overhead is balanced and appropriate. the futures market and resulting margin No one party in the grain industry In some cases, preserving working calls. should assume the financial burdens capital may require some tough In today’s volatile markets, hedging associated with protecting prices for decisions, such as putting off planned has become extraordinarily capital another level in the system. Since plant expansions, selling assets that are intensive and is one of the primary everybody benefits from hedging, the not critical to the business, holding off drivers behind the increased demand risks and costs need to be spread across on new property and equipment for debt capital on the part of grain a broader base – one that specifically purchases, or reducing dividend elevators and agricultural businesses in includes producers. For farmers, that distributions to owners to strengthen general. may mean less pricing flexibility from liquidity. At CoBank, one of the largest elevators for future crop years. Looking at the bigger picture, there financiers of grain in the country, we Recognize, however, that farmers will are a variety of steps that grain elevators have seen dramatically increased always have the option of using a can consider as they look to preserve borrowing needs for virtually all of our broker to access the futures market on and build working capital. Deciding on grain customers during the climb of their own. which, if any, of these options is right grain prices. We and other financial Most farmer-members of the nation’s for a given grain elevator requires institutions, both inside and outside the grain elevator co-ops will recognize and careful scrutiny and analysis. A Farm Credit System, have worked to appreciate the merits of this approach. profitable course of action for one accommodate these customers during After all, they have an ownership stake operation may not be the right solution for another. One of the biggest ways a “Working with another co-op in a joint venture may be a practical and cooperative grain elevator can build efficient way to spread risks and costs over multiple balance sheets.” capital is by retaining more earnings. Operators should be looking closely at their future liquidity needs as they calculate how much patronage they this unprecedented time and will to protect in their local elevator – as return to members. More of that capital continue to do so. well as a vested interest in the overall may need to stay at the elevator to fund But credit is not an unlimited health of the U.S. grain delivery system inventories of higher priced farm inputs resource — especially in the current in which the elevator plays such an or margin calls. While producers economic environment. And borrowing important part. certainly appreciate cash payments, they more, without a commensurate increase 2. Maintaining a strong capital also will appreciate having a financially in earnings and equity capital, is not a foundation — Even if elevators sound grain elevator that will be able to long-term solution to this problem. In successfully shift some of the risks buy their crops in the future. our view, the grain industry needs to associated with hedging to their Another option worth exploring is make two key adjustments going member producers, the working capital partnering with other grain elevators. forward: requirements of their businesses will Working with another co-op in a joint 1. A new approach to price-risk have the potential to spike upward as venture may be a practical and efficient management — Historically, the lion’s long as volatility in the grain market way to spread risks and costs over share of hedging risk in the system has persists. multiple balance sheets. These kinds of been borne by the country elevator. Managing those higher capital arrangements may allow smaller Elevators, furthermore, have often been requirements, first and foremost, will operations to realize the benefits of the willing to contract to purchase crops for require solid business practices that economies of scale that larger multi-year time periods – agreeing to create the basis for a strong capital organizations enjoy. purchase grains at a specific price even foundation. On the most basic level, All members of the grain industry before crops were planted. Elevators that means having a well-designed value chain — farmers, elevators, have used the futures market to hedge business plan that is flexible enough to lenders, shippers, millers, exporters, against potential price drops in the respond to market conditions. It means biofuels producers and consumers — market. More recently, country doing an excellent job of offering have a vested interest in guiding the elevators have continued to bear the farmers pricing options on crops as well sector through this important transition majority of the cost of these price-risk as timely service in accommodating period. By making these changes in management programs. high production at harvest. behavior and building foundations of But what was an acceptable business It means understanding and pricing financial strength, elevator operators practice for elevators in the days of $2- sales with appropriate margins. And it will help the industry fulfill its long- a-bushel corn is proving far less means making sure that operating term promise. ■

Rural Cooperatives / November/December 2008 17 Co-opsCo-ops ringring upup additionaladditional $14$14 billionbillion inin salessales viavia otherother ownershipownership structuresstructures

E. Eldon Eversull hereafter). This study was used to determine how many Agricultural Economist cooperatives used these ownership structures, their USDA Rural Development percentage of ownership and the sales and assets of these ventures. arm, ranch and fishery cooperatives had additional sales of at least $14 billion in 2007 Variety of incentives for ventures from other, non-cooperative business There are a wide variety of reasons for a cooperative to ventures they have formed or invested in to use a non-cooperative ownership structure. For example, a market products or sell supplies. These other cooperative that would like to build an ethanol plant or a businesses represent more than $7.5 billion in assets. food-manufacturing facility may not be able to raise enough The Cooperative Programs staff of USDA Rural Development surveyed cooperatives about their use of other ownership structures for business ventures in 2007. There Table 1—Number of ventures, sales and assets, by cooperative type were 728 respondents, with 204 noting that they used other Cooperative Type Number Ventures Total sales Total assets ownership structures to bolster revenue to the co-op. Since not all co-ops responded to the survey, the actual Number Billion $ sales total from these non-cooperative business ventures is Cotton and Cotton Gins 3 5 0.346 0.156 almost certainly higher than $14 billion — perhaps Dairy 9 43 12.764 5.078 significantly higher. If these revenues were added to the total Fruits and Vegetables 6 9 1.372 0.485 Grains and Oilseeds 85 159 7.455 3.744 co-op business volume reported annually by USDA ($147 Livestock & Artificial billion in 2007; see page 19 of the Sept.-Oct. issue of Rural Insemination 4 5 0.408 0.121 Cooperatives), co-ops would account for an even bigger share Nuts, Poultry, Dry Beans & Peas, Sugar 7 7 1.196 0.926 of the nation’s food and farm supply market. Other Marketing 5 9 0.235 0.147 Other ownership structures used by cooperatives in this Supply 80 138 28.844 11.040 study include limited liability companies (LLC), Service 5 7 0.015 0.022 corporations, limited liability partnerships (LLP), 204 382 52.635 21.720 partnerships and other types ownership structures (“other”

Table 2—Structure of the venture, percent ownership, sales, and assets by cooperative type

Ownership structure of the venture Percent ownership by your cooperative

Corp- Partner- 1% to 20% to Wholly Venture Venture Cooperative Type LLC oration LLP ship Other 20% 49% 50+% owned sales assets

Number Number Billion $

Cotton and Cotton Gins 4 1 0 0 0 0 0 0 4 0.022 0.025 Dairy 37 5 0 0 1 3 6 16 18 6.633 3.686 Fruits and Vegetables 5 3 1 0 0 1 3 2 1 0.032 0.009 Grains and Oilseeds 141 10 3 1 2 65 40 36 11 1.782 1.341 Livestock & Artificial Insemination 4 1 0 0 0 1 0 2 2 0.020 0.010 Nuts, Poultry, Dry Beans & Peas, Sugar 5 1 0 0 0 2 1 0 3 0.729 0.510 Other Marketing 5 3 0 0 1 2 0 3 4 1.661 0.217 Supply 106 20 6 2 4 21 28 48 36 2.772 1.650 Service 5 0 0 0 2 0 0 4 3 0.240 0.090

312 44 10 3 10 95 78 111 82 13.892 7.537

18 November/December / Rural Cooperatives funds from its members or through bank loans. An LLC Figure 1—Number of ventures by type might be formed to obtain funds from outside investors to make this venture possible. In another case, two cooperatives might form some other type of ownership structure for their agronomy operations, allowing the co-ops to offer more services, personnel and equipment by pooling resources. Several cooperatives might form a business using some other ownership structure as a first step toward a possible merger. If the co-ops prove compatible when working together in the venture, they might opt to eventually form a single cooperative. While there are many reasons for forming other ownership structures, this study did not ascertain why they were used nor determine whether the ventures were with other cooperatives, investor-oriented firms, or non-member investors. Some of the ventures in this study could be between cooperatives, which would lead to double counting of their sales volume. A more through analysis is planned Figure 2—Percent ownership of all different structures using information from this survey to document the use of alternative ownership structures and their importance.

LLCs most common The 204 survey respondents who reported using other business structures are involved in 382 such ventures. Of these, 312 (82 percent) were LLCs (figure 1). In 96 of these LLCs, the co-ops owned more than 50 percent of the business (figure 2), while 53 of the businesses were wholly owned by the co-ops. Thus, co-ops held a controlling interest in 48 percent of the 382 businesses. A wide variety of cooperative sizes (by sales volume) are Figure 3—Number of respondents by size of sales (million $) involved in ownership of these businesses (figure 3). On the high end were 12 co-ops with sales of more than $500 million that have invested in at least one LLC. On the other end of the scale are 11 co-ops with sales of less than $5 million that have LLCs. The largest number of cooperatives (47) with an ownership stake in one or more LLC reported annual sales of between $25 million to $49 million. The cooperatives that reported being involved in at least Table 2—Structure of the venture, percent ownership, sales, and assets by cooperative type one of these “other ownership structure” businesses account

Ownership structure of the venture Percent ownership by your cooperative for just over 34 percent of the nation’s total co-op business volume. Grain/oilseed and supply cooperatives accounted for Corp- Partner- 1% to 20% to Wholly Venture Venture most of the survey respondents (as would be expected, since Cooperative Type LLC oration LLP ship Other 20% 49% 50+% owned sales assets they represent by far the largest number of surveyed co-ops). Number Number Billion $ Responses from cotton and cotton gins, livestock, artificial insemination, nuts, poultry, dry beans/peas and sugar Cotton and Cotton Gins 4 1 0 0 0 0 0 0 4 0.022 0.025 Dairy 37 5 0 0 1 3 6 16 18 6.633 3.686 cooperatives were combined in tables 1 and 2. Fruits and Vegetables 5 3 1 0 0 1 3 2 1 0.032 0.009 About half of the sales and assets documented in this study Grains and Oilseeds 141 10 3 1 2 65 40 36 11 1.782 1.341 would not be captured in USDA’s annual statistical report on Livestock & Artificial Insemination 4 1 0 0 0 1 0 2 2 0.020 0.010 cooperatives, since the co-ops do not have a controlling Nuts, Poultry, Dry Beans interest in the venture. The sales volume would be reported & Peas, Sugar 5 1 0 0 0 2 1 0 3 0.729 0.510 as a distribution of earnings from the business venture (net Other Marketing 5 3 0 0 1 2 0 3 4 1.661 0.217 Supply 106 20 6 2 4 21 28 48 36 2.772 1.650 income) on the income statement of the respondents, Service 5 0 0 0 2 0 0 4 3 0.240 0.090 appearing in the “non-operating income” category, or as ■ 312 44 10 3 10 95 78 111 82 13.892 7.537 “income from other ventures.”

Rural Cooperatives / November/December 2008 19 Sky’s the Limit!

By Dan Campbell, Editor

high percentage of homes occupied by owners is a vital ingredient for healthy neighborhoods. When Happy together: members of the Oak Street Cooperative (above and on facing people have an ownership page) say the co-op made it possible for them to become home owners. Community stake in their homes, they naturally tend to Development Director Al Smith is wearing a cap, at rear. Background photo: cranes take better care of them and get more loom up at the Bath Iron Works shipyard, one of the state’s largest employers. involved in civic affairs. USDA photos by Dan Campbell So with the renter-vs.-ownership ratio nearing 50:50 in Bath, Maine, community development (BIW), one of the state’s largest employers, with a workforce director Al Smith began thinking about a housing that ranges from about 5,000 to 6,000 (depending on current cooperative as one way to open doors to homeownership for contracts). This is down from a peak of about 12,000 in the people who would otherwise be renters. 1980s, Smith says. “Maine is a very rural state, and like most rural areas, it Booms in shipbuilding during the two world wars and tends to have a high percentage of homeownership,” says again after World War II resulted in construction of a Smith, talking over a cup of coffee in Bath’s lovely old city number of public-financed housing developments in Bath. hall building. “I was intrigued by the idea of a co-op to “Being an older city [Bath incorporated in 1781], the provide easier access to homeownership and as a tool to housing stock is older, and renovation is an issue for many strengthen and maintain our wonderful neighborhoods. The homes,” Smith says. “So we have fair amount of affordable idea of a co-op just seemed to make a lot of sense for a housing and multifamily properties, but with a fair amount of community like Bath.” absentee landlords.” His plan was to find an older property that could be Shipbuilding roots converted to co-op ownership. Bath is a city of about 10,000 people on the Kennebec River in the Midcoast region of Maine, but the population Co-op model studied swells greatly during the summer tourism season. It has a Before a property was selected, city planners first looked at proud history as one of the nation’s primary shipbuilding the co-op model and studied how a housing co-op could be centers, having built and launched more than 5,000 ocean- developed and promoted in Bath. Funding was then secured going ships since the 1700s. for a project that would accommodate low-to-moderate Bath was a major builder of clipper ships, beautiful sailing income people. vessels that were the fastest of their day. At one time, it was “We saw this as an opportunity to showcase the idea of a home to more than 200 shipbuilding firms, and by the mid- limited-equity co-op as a path to ownership,” says Smith. 1800s it was the nation’s fifth busiest seaport. “The way we did it may not be suitable everywhere, but I This tradition is carried on today by Bath Iron Works believe this model could be replicated to provide access to

20 November/December / Rural Cooperatives Housing co-op opens doors for first-time ownership

ownership and lead to greater stability for neighborhoods.” It needed electrical renovation (which turned out to be a A Community Development Block Grant was secured bigger job than originally thought) and painting. Drains had from the Maine Department of Economic Development, to be installed around the foundation to dry out a damp which was matched by the Federal Home Loan Bank of basement. Boston. The effort was also backed by several other Members did much of this work themselves under a sweat- organizations in the community, including the Bath Housing equity program, which allowed them to cut in half the $2,000 Authority, which acted as the project developer. Coastal co-op membership fee. Members had to show that their Enterprises assisted with home homeownership and budget income was no higher than 50 to 80 percent (depending on management classes. the unit desired) of Bath’s $38,000 median income. “The city’s role was organizing the co-op and training the Smith says buying and renovating the property ran members — a fairly long process,” Smith says. roughly $450,000, of which about $240,000 was financed Attention first focused on a 35-duplex development in the through the Cooperative Fund of New England, which is Lambert Park neighborhood. “It was being operated by a charging no interest for the first three years. “That gave us a nonprofit, but the property needed a lot of improvements nice jump start.” and a large balloon payment was near due, so the owner The Oak Street Cooperative of Bath Inc. has nine basically wanted out,” Smith says. members living in five units: one three-bedroom unit, two This effort eventually stalled. Rather than risk losing the two-bedroom units and two one-bedroom units. The co-op funding already secured, the group started looking for has been fully occupied since November of 2007. another property. Part of a members’ monthly payment goes against This was in 2005, and the real estate market in Bath was principal, creating equity. “Our lease-sale formula provides still fairly strong. But reports that the nearby Brunswick that people can earn up to five years of the principal. We Naval Air Base was slated for closure resulted in a number of wanted them to gain equity, but to keep the overall property properties being placed on the market as the owners tried to affordable.” beat the base closure. Like a family Five-unit building selected The camaraderie among the members, and pride of A multifamily property with five units in two adjacent ownership, was evident when Smith led a visitor on a tour of structures caught Smith’s eye. Although this would be a the property. All households are co-op board members, smaller project than he originally conceived, it was an which Smith says has helped develop “a sense of family” and attractive property for a number of reasons. mutual support among the members. The original building dated to 1858, the other to about Some structural work still needs to be done, including a 1900 (they form an “L”-shaped structure), but it was in stone wall along the street frontage that will likely have to be reasonably good repair. “It is a great location – right on edge replaced at some point. The co-op has limited cash reserves of downtown, with short walks to the library, city hall, a food at this point, so the board has had to come to grips with market and other stores,” Smith says. “And most units have a budgeting for repairs as funds allow. water view.” continued on page 23

Rural Cooperatives / November/December 2008 21 Utility Co-op Connection Putting service ahead of profit helps utility co-ops win JD Power Award

with the trophy,” recalls SMECO President and CEO Joe Slater. “My assistant opened it and brought it to my office. A few days later, J.D. Power and Associates called us.”

Key to customer satisfaction The commitment to service of Jackson EMC employees, such as these, helped the How do Jackson EMC and SMECO co-op win the highest consumer rating for a utility of any size in the nation in J.D. run efficient utilities and simultaneously Power and Associates’ annual survey. Photo courtesy Jackson EMC keep customers satisfied? “All of our employees understand that we work for our owners — our customers,” Slater explains. “The cooperative business model allows us to By Anne Mayberry size nationwide. stay focused; we’re not distracted by Utility Programs, Jackson EMC, based in Jefferson, Ga., earnings per share. We are not driven USDA Rural Development and SMECO, based in Hughesville, by a profit motive. We put our Md., received recognition in J. D. customers first.” aintaining reliable Power and Associates’ 2008 Electric Randall Pugh, Jackson EMC electric service at Utility Residential Customer president and CEO, says: “Jackson affordable rates is the Satisfaction Award for midsized utilities EMC’s focus has never shifted from the cornerstone of the (those serving between 125,000 and day we first powered our lines in 1939; nation’s 900-plus rural 499,000 residential customers) in the the focus is providing our members electric cooperative utilities. With South and East, respectively. Two more with high quality service and reliable, increasing energy costs, that goal is rural electric cooperative utilities — affordable power. Every decision we becoming more challenging. Santee Cooper in South Carolina and make is with our members’ best Yet rural electric cooperative utilities Clay Electric Cooperative in Florida — interests in mind, and we truly are meeting that challenge. Jackson won the second and third place scores appreciate this response from our EMC and Southern Maryland Electric (respectively) in the South. The award members.” Cooperative (SMECO) recently scored is based on the results of an annual Pugh says that 2008 marked the first the highest customer satisfaction marks consumer survey conducted by J. D. year the co-op was included in the among midsize utlities in their regions, Power and Associates. study. “When I look at this award, I’m according to J.D. Power and Associates. The award to SMECO came as a reminded of 461 reasons why we Jackson EMC also was noted for complete, but very welcome, surprise. received this honor — our employees,” achieving the highest customer “Our first notice that we’d received he adds. satisfaction score among utilities of any any kind of award was receiving the box Slater says SMECO’s award is

22 November/December / Rural Cooperatives especially gratifying because it is the great reputations,” he notes. “I hear all Sky’s the Limit! result of the co-op earning high the time about how great co-ops are continued from page 21 customer satisfaction ratings. For many and how much their customers love the electric customers, the real test of service they receive from rural electric service from their utility is how the cooperatives.” company responds during emergencies. Rural electric co-ops serve 41 “It would have been very hard for “We tend to have a lot of storms in million consumers in 47 states, me to buy a place without this co-op,” southern Maryland, but we’re able to according to NRECA. Co-ops are the says Steven Cummings, the co-op provide good information to our fastest growing segment of the electric president and a first-time homeowner. customers because of our outage- utility industry, and are concerned “It feels awesome — I love it here. It’s management system,” Slater says. about how to address growing demand got a view, and the heating cost is Installed two years ago, the system for electricity. reasonable.” connects mobile laptops with SMECO’s Like most electric utilities, SMECO Cummings, like all the other computer systems, allowing crews to and Jackson EMC work hard to ensure members, has never served on any type use technology to pinpoint and quickly that long-term power supply is reliable of board of directors before, so the co- respond to outages. “People like and affordable. The fact that SMECO op classes and sessions on budgeting certainty. They want to know what and Jackson EMC are locally owned were very helpful, he says. “I highly caused the outage and when their and operated increases their recommend co-op living for anyone power is coming back on.” responsiveness, Slater says. “We’re part with lower income or poor credit.” SMECO’s involvement with the of the community we serve.” Solo Martin, who works at a community “helps touch a lot of lives Most cooperatives, by their nature, preschool, couldn’t agree more. “It’s through our scholarships and various tend to be good corporate citizens, he beautiful here and we [she shares a unit other projects,” Slater says. adds. “We have plans for conservation with her sister] are very happy. I’ve The most basic cooperative and efficiency. We have plans to build never been a homeowner before, and advantage may be the unique financial new transmission lines. We keep our being on a co-op board and working so structure of rural electric co-ops. The customers informed of our issues and closely with the other members is an cooperative business model emphasizes activities and were ranked very highly entirely new experience for me. We all reliable service at affordable costs. for that effort.” sort of look after each other!” Member equity is often listed as one of Pugh credits employees with the Since the Bath co-op was formed, the benefits of being a rural electric recognition from J. D. Power and another small housing co-op, Faire cooperative customer. This same Associates. “Jackson EMC’s employees Brande, has been developed in the city business model produces positive credit have a long-standing dedication to of Lewiston, about 26 miles away. ratings for rural electric cooperatives, provide service that exceeds our which reduces the cost of borrowing members’ expectations, whether that Co-op housing opportunities money. means quickly restoring power after a “I see tons more opportunities for “Our business model not only storm, making sure our bills are similar co-ops in this region,” says increases customer satisfaction, but also correct, promptly handling members’ Smith. “Rockland, Belfast — and takes the form of high credit ratings — requests, or planning infrastructure Brunswick with its large student higher than many investor-owned additions to ensure adequate power population — would all be good places utilities,” Slater notes. “This in turn supplies.” for housing co-ops.” translates into lower funding costs.” Slater says the detailed survey results The concept of small housing co-ops that came with the award are being like the Bath model might even have Co-op advantages studied by the co-op. “We’re really applicability for meeting the need for Martin Lowery, executive vice interested in any places where our group homes for handicapped people president of external affairs for the scores could have been higher. We’re around the nation, many more of which National Rural Electric Cooperative going to see what we can do to earn a are needed as more large residential- Association (NRECA), echoes Slater’s higher rating.” type institutions are phased out. assessment, adding that a key advantage One example Slater cites is to “I would love to see some other of the cooperative business model is expand the ability of SMECO housing co-ops formed around here so that “members have equity in customers to set their own billing due we could explore going in together on cooperatives.” dates. “This is one area we want to purchasing heating fuel and on Lowery says the reputation of continue to focus on. Our customers maintenance work,” Cummings adds. cooperatives for service is well want options, flexibility and control. “The sky’s the limit for this co-op!” ■ deserved. “Businesses that care about We’re seeing how we can accommodate serving their members tend to have those interests.” ■

Rural Cooperatives / November/December 2008 23 Management Tip Co-op boards demonstrate leadership through strategic planning process

By Jean Freeman, President when it comes to long-term leadership. process without first reaching consensus Jean Freeman & Associates One of the best tools available to on the need to do so, as it is to fail to cooperative boards in fulfilling their go through the planning process at all. Editor’s note: The author is a Fairfax, Va.- important fiduciary duties is the Once consensus is reached, the based consultant who specializes in dynamic process of strategic planning. strategic planning team can begin the governance and communication issues for Few people will disagree that important work ahead. For small cooperatives, nonprofits and for-profit planning is important. However, many boards, it is common for the team to companies. may be unclear about what strategic include all sitting board members, along planning is and why it is so critical to with the manager or CEO and key staff here is no question that the future success of the organization. members. Some co-ops may include all governing boards are What is strategic planning? Simply other stakeholders in the process. under the spotlight put, it is the process of determining today. Due to some where the co-op is going over coming Review the mission highly publicized years, how it will get there and how the Before beginning to plan for the scandals in both publicly traded co-op will know when it has succeeded. future, the board should review the co- companies and nonprofits, in which There is no one correct method of op’s statement of purpose, or mission board members did not properly fulfill planning strategically. However, there statement. This statement should their duties, many cooperative boards are some key tools which should be concisely describe why the organization are taking a closer look at their considered when a board takes on this exists, what services it provides and, in governance practices, including their process. some cases, what core values will be long-range planning and monitoring maintained in the process. systems. Reach consensus on need The mission statement is the Some boards, however, are so The board must thoughtfully explore umbrella under which all plans should enmeshed in short-term compliance the need for strategic planning. It is then fit. The board should look issues that they risk dropping the ball almost as wrong to jump into the carefully at the co-op’s mission and

24 November/December / Rural Cooperatives agree that it is still completely relevant If you have established that mission, the board at scheduled intervals. and accurate. If not, this is the and if the board feels passion for that The board of directors is responsible appropriate time to tweak the mission mission, then you’re ready to move for establishing the mission, hiring the to reflect the current culture and forward. manager or CEO, providing financial membership expectations. The board should at least revisit that oversight and monitoring the progress mission to make certain it is indeed why of the organization. Once the hard Review former plan your organization exists. Some like to work of developing a strategic plan is This may not be the first time the establish additional statements, such as done, it now becomes much easier to co-op has worked on the strategic a vision or a values statement. It isn’t make sure that goals are accomplished. planning process. If there is a strategy necessary for all organizations to adopt The board now has a plan to hand in place, this is a good place to get the same set of statements. However, over to the manager, and the manager started. the mission is a necessary statement of now has a clear guidebook for putting Board and management participants purpose. Goals and objectives will together an action plan and working (“the team”) can look with fresh eyes at naturally flow from a targeted mission toward attaining the desired goals. It is what is in place and begin thinking statement. clear what types of monitoring must

Any board member at any time should be able to answer the question: “Are we still heading toward the place we want to be?”

about how clearly the existing plan Environmental analysis — A part take place in order to keep track of reflects the purpose of the organization. of the planning process should include a progress. The board, with a solid plan, hard look at the current and the likely is positioned to demonstrate Create the strategy future environment. This analysis might transparency to its membership. Any board member at any time include legislation, consumer survey should be able to answer the question: results, economic development, Keep the plan alive “Are we still heading toward the place technology, competition and other areas Although a lot of planning takes we want to be?” The board should do a with the potential to impact the co-op’s place in any well-run company, strategic thorough analysis of current conditions, ability to stay on mission. planning is not done every month. It future projections and potential SWOT — Some find the exercise of may not even be necessary to conduct competition for its cooperative’s goods identifying strengths, weaknesses, full-blown strategic planning every year. and services. opportunities and threats (SWOT) a But it is important to review the plan Based on this thorough analysis, very helpful tool. The co-op leadership and monitor its progress on a regular board members can then develop a can benefit by including key staff and basis. strategy. At this point, it is important to stakeholders in this exercise. Of course, Many organizations “visit” their plan take a good look at membership needs the team must head into the planning on a monthly basis, simply by reviewing and the co-op’s ability to create value process open-minded and ready to hear monitoring reports from management. for its membership. from different players with different In most cases, plans should be reviewed Remember, once the strategic perspectives. at least annually. planning process has been completed, Although no board wants to re- leadership must continue to think Executing the plan strategize frequently, it is important to strategically to keep on track. No matter how beautiful a remember the plan is not static. We live completed plan may look, it is only a in rapidly changing times. Regulations, Good set of tools needed beautiful symbol of a waste of valuable technology, climate and member Mission, vision, values, goals — As time unless the board builds in expectations, to name a few, are not stated before, it would be a waste of monitoring requirements to hold others static areas. Therefore, it makes sense time for a co-op’s leadership to begin a accountable for keeping the plan in for a responsible board to be prepared strategic planning process without play. These monitoring tools typically to revisit the plan formally, as necessary. reaching consensus for a clear mission. involve reports from management to ■

Rural Cooperatives / November/December 2008 25 CCA salutes top co-op

or his three decades of commitment to cooperatives and communications excellence, Paul Wesslund, vice president of communications for the Kentucky Jim Duncan, CEO of Sumter Electric Co-op, Association of Electric Cooperatives, has won the CEO Communicator award. been awarded the H. E. Klinefelter award. The award is the Cooperative Communicators Association’s (CCA) top honor, recognizing individuals whose work has helped to further the cooperative business system and raise the successful programs he has created, and trying to find the standards of cooperative communications. ways to duplicate those efforts in my state.” The award was presented in June during CCA’s annual Wesslund is the 50th winner of the Klinefelter award, communications institute in Portland, Maine. named for a CCA founder and longtime editor at MFA Inc., Jim Duncan, CEO of Sumter Electric Cooperative who died in 1957. (SECO) in Florida, won the CEO Outstanding Communicator award. Marian Douglas, manager of Duncan communicates ‘co-op difference’ publications for Flint Energies in Warner Robins, Ga., took Duncan was saluted for championing the cooperative home the Michael Graznak Award, which honors excellence difference at SECO, which he has led since 1990. Evidence in co-op communications by a person under age 36. of this is manifested in every communications vehicle SECO Susie Bullock, who is stepping down after serving as CCA’s uses to interact with its various constituencies, both internal executive director for 18 years, was honored with a special and external, said award presenter Janet Schoniger of award and tribute, recognizing her efforts to advance the CoBank. organization and the state of co-op communications. SECO is one of the nation’s largest electric co-ops, serving 165,000 member/customers in a Central Florida service Wesslund strengthens REC system territory the size of Delaware. Following four years working for daily newspapers in “What has evolved, by design, is a total communications North Dakota, Wesslund began his cooperative career with program that constantly reinforces the seven cooperative the National Rural Electric Cooperative Association principles, philosophy and way of doing business,” said (NRECA) in 1979. During a 16-year tenure with the Schoniger. “More than that, it encourages two-way Washington, D.C.-based organization, he rose steadily communications and generates a sense of empowerment through the ranks to become associate department director of where employees, customers and other constituencies are communications services. concerned.” In 1995, Wesslund moved on to the Kentucky statewide His leadership skills in the electric industry REC, where he also serves as editor of the association’s communications arena has led to the co-op receiving some of member magazine, Kentucky Living, which has a circulation of the highest American Consumer Satisfaction Index scores in 400,000. the country for a co-op of its size. “Paul has spent much of his career bringing meaning to cooperatives in ways that clearly speak to their advantages Douglas: innovative communicator and strengths,” said nominator Jeff Almen, a coworker of Nominators said Douglas is an energetic and innovative Wesslund’s during his years at NRECA. communicator whose impact has included “more focused “Paul has been a mentor, confidant and friend throughout connections with members, more effective methods with my career,” added Darryl Gates of the Alabama Rural employees and more engaging avenues with the community.” Electric Association of Cooperatives. “I find myself studying Douglas has more than 14 years’ experience in public

26 November/December / Rural Cooperatives communicators

relations directors, graphics designers, advertising managers and Webmasters.” Changes made at CCA during her years as executive director included: establishing CCA’s six-region membership Graznak Award winner Marian Douglas and structure; developing its first website; establishing the board Klinefelter Award winner Paul Wesslund. liaison system of managing committees; computerizing bookkeeping; moving the newsletter and membership directory online; creating a number of new awards and relations, including 10 years serving the electric cooperative fellowships; developing a policy and procedures manual and industry. While working for an advertising agency in South creating the Master Cooperative Communicator program, Carolina, she managed advertising and public relations for 21 among many others. electric cooperatives in South Carolina and Georgia. “I encourage all of you to dive headlong into CCA Her resume also includes a stint as community relations activities,” said Bullock. “Get involved and make your own manager at Santee Electric Cooperative. While there, mark on CCA’s history.” Douglas successfully managed the cooperative’s crisis communications efforts during Hurricane Floyd in 1999. She Contest winners also previously served as executive director of a chamber of Best of Class award winners in CCA’s annual commerce. communications contest were: “Marian came to Flint, and to Georgia, in late 2004 with • Writer of the Year — Richard Biever of Indiana Statewide respect for cooperative tradition, as well as a fresh perspective REC Inc., (for a portfolio of articles); and innovative mind that would consolidate and exploit our • Photographer of the Year — David Lundquist of CHS- communication tools and opportunities," recalled nominator Land O’Lakes (for a portfolio of photos); Robert Ray Jr., CEO of Flint Energies. • Programs and Projects — Shane Read of Tennessee The award is named for a young Missouri cooperative Farmers Cooperative (for a print advertisement he communicator who died while on assignment. designed, “Grab the Great White”). • Publication of the Year — Brett Faber of Aurora Coopera- Bullock takes final bow tive (for Aurora’s 1908-2008 Centennial publication). Bullock announced last year that she is retiring from her USDA’s Rural Cooperatives magazine won four awards in CCA post to devote more time to assisting her husband, Jim, the contest, including: First place for serious or investigative who was recently named vice president for academic affairs at feature writing, won by contributor Catherine Merlo (for Ohio Valley University in Vienna, W. Va. “When a Co-op Dies” about the closing of a California Bullock, also a past Klinefelter award winner, joined CCA cotton cooperative); First place photo illustration, won by (then the Cooperative Editorial Association) in 1975, just Assistant Editor Stephen Thompson for a piece of art in after graduating from college. Ten years later, during the which he transformed a milk bottle into an ethanol fuel organization’s business meeting in Chicago, Bullock recalled pump; Second place for serious or investigative feature lobbying for the name change to CCA. writing, won by Editor Dan Campbell (for “Thinking “The word ‘communicators’ rather than ‘communication’ Outside the Carton,” about Fruit Growers Supply co-op in not only humanized the organization, but it was more California); Honorable mention for Writer of the Year, also descriptive of CCA’s multifaceted role in telling the won by Campbell (for a portfolio of articles). cooperative story,” Bullock said. “The name still accurately For more information on CCA and how it helps co-ops reflects the involvement of not only writers and editors, but improve their communications efforts, visit: of photographers, broadcasters, marketing specialists, public www.communicators.coop.

Rural Cooperatives / November/December 2008 27 CDF’s multi-pronged efforts support co-op mission in America and abroad

The Race for Cooperative Development raises money and awareness of co-ops every October. This year, a record 15 teams, including the ACDI/VOCA team (seen here), participated. Below:The ICA Group, a recipient organization of the CDF’s United Co-op Appeal, builds worker co-ops, such as this sewing co-op. Photos courtesy Cooperative Development Fund

By Steven Thomas, Executive Director of CDF’s most active funds. Its mission — to promote Cooperative Development Foundation consumer-owned food cooperatives in the United States — is served through he Cooperative Development Foundation — grants for education the nation’s oldest cooperative charity — and training of may not be a household name, but it has grocery cooperative T made a major impact on economic staff and board development through cooperatives for almost members. 65 years. This work was initially done under the umbrella of • The MSC Fund, the Freedom Fund (beginning in 1944), then the Fund for CDF’s largest fund, International Cooperative Development (1947), the was established in Cooperative League Fund (1969), and, ultimately, the 2004. Formerly the Cooperative Development Foundation (1988). Mutual Service Starting with the founding of CARE after World War II, Fund of the MSI CDF began by helping European farmers recover from the Insurance Foundation, it has been in operation for more destruction of the war by providing “seed” funds to help than 30 years and has awarded more than $1 million in them form cooperatives — giving them the scale to reach grants to the cooperative community. In 2005, the fund’s markets across Europe’s war-devastated infrastructure. CDF trustees decided that it would focus on projects and retained an international focus until the 1980s, when it began organizations that find and/or replicate cooperative fundraising and forming programs to assist domestic solutions for issues facing seniors in rural areas. cooperatives, particularly in rural areas. • The NCBA Fund supports the National Cooperative Business Association’s cooperative development projects Family of funds and programs in the United States and overseas. Through a combination of bequests, donations and fund • The Sollars Fund strengthens the cooperative form of additions, CDF now has 11 funds that seek to resolve business through interaction between U.S. and overseas different problems through the development of different cooperatives. The fund provides grants to cover overseas types of cooperatives. These include the following: travel expenses of U.S. cooperative leaders, enabling them • The Bowers Fund, which assists cooperative grocers, is one to visit counterparts to exchange information, strengthen

28 November/December / Rural Cooperatives trade and provide technical assistance. Nominations are received annually and reviewed by two • The Shirley K. Sullivan Education Fund was established in committees, each composed of current leaders from the 1998 by the Cooperative Communicators Association various sectors of the U.S. cooperative movement. More (CCA) to give its members scholarships for training. The information on the Cooperative Hall of Fame can be found fund offers educational grants to cooperative at www.heroes.coop. communications professionals, enabling them to attend The 5k Race for Cooperative Development is a certified professional development seminars or classes, including run/walk for all ages. The race calls attention each October National Cooperative Business Association (NCBA) and to Cooperative Month, an annual celebration of the impact of Graduate Institute of Cooperative Leadership (GICL) cooperatives on the United States and its communities. It is programs and CCA’s annual co-op communications also a fundraiser for CDF. The race normally attracts several institute. hundred runners, including teams from more than a dozen • CDF also has three revolving loan funds for cooperative cooperative organizations. More information can be found at: housing: one for senior cooperative housing, a second for www.cdf.coop/5kRace. limited equity cooperatives and a third for student housing The online Co-op Art and Crafts Auction is a fun way to cooperatives. These funds make pre-development and profile the art and craft co-op community as an example of a bridge loans, leveraging substantial additional capital for cooperative business and to help art and craft co-ops gain the creation, renovation and expansion of housing co-ops. visibility and new markets for their work. Visitors to the • The CDF Fund is a “special opportunity fund,” used to auction website and catalog learn about the basics of a make grants or loans to potentially significant cooperative cooperative business, as well as specifics about the artists and projects that don’t fall within the scope of CDF’s other the art and craft co-ops that participate in the auction. funds. The funds CDF raises from this auction will build more What is the impact of these funds? Together, they create programs in support of art and craft co-ops as the auction opportunities for seniors and working families to own quality progresses. More information can be found at: homes; for students to obtain affordable housing and take http://www.cdf.coop/node/7. responsibility for running it; for people to obtain healthy The United Co-op Appeal (UCA) is an annual workplace- food; for farmers and others in developing countries to obtain giving program that is managed by the CDF. UCA supports good prices for their goods at market; and for cooperative 16 nonprofit organizations that use the cooperative enterprise leaders to learn to better serve their co-op and its members. model to bring self-sufficiency and economic development to individuals and communities through the United States and Programs for cooperative around the world. Since it began 15 years ago, UCA has awareness and fundraising raised more than $1 million to support cooperative In addition to its family of funds, CDF also operates development projects. several programs designed to promote cooperatives and raise funds for cooperative development. Cooperative future Foremost of these efforts is the Cooperative Hall of Fame, Part of CDF’s history has been a tradition of rapid which honors individuals whose contributions to cooperative response to help cooperatives in need in disaster zones, from business have been genuinely heroic. Inductees are limited to postwar Europe in 1944, to New York City after the 9-11 a group carefully terrorist attacks, Hurricane Katrina in Louisiana and selected to Mississippi in 2005, to the present day. Most recently, CDF preserve the distributed $25,000 from its Katrina Recovery Fund to the nature of this Federation of Southern Cooperatives to help establish fishing special cooperatives in areas damaged by Katrina. recognition. With emergency cooperative relief sure to be a part of Each year CDF’s role in the future, CDF is working to create a a select few men systematic approach to emergency relief, with a dedicated and women are fund that will allow for more rapid response to disasters. honored because CDF’s longstanding role as a supporter of cooperative of their heroic housing will also play a clear role in the future; plans are in The National Rural Electric Cooperative contributions to place for a streamlining of process that will increase the Association’s International Foundation, the enhancement effectiveness of CDF’s efforts there. a recipient organization of CDF’s United of cooperative Ultimately, however, CDF’s model can be adapted to meet Co-op Appeal, works on developing electrical co-ops in Africa and other enterprise and to any future cooperative needs just as it has in the past. This developing regions. the advancement flexibility of execution and timeliness of mission will drive the of the principles changes CDF makes to prepare cooperatives for the 21st of cooperation. century. ■

Rural Cooperatives / November/December 2008 29 Newsline Co-op developments, coast to coast

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Workers and guests assemble for the grand opening of the new, $85 million Prairie Pride co-op biodiesel plant in central Missouri. Photo courtesy Prairie Pride. Below: Worldwide demand is soaring for dried sweetened cranberries, being produced by Ocean Spray at its plant in Wisconsin Rapids. Photo courtesy Ocean Spray

Prairie Pride biodiesel plant biodiesel and ethanol are good for rural their soybeans; fully operational economic development, and renewable • To reduce the United States’ Prairie Pride Inc., a new-generation fuels help ease our dependence on dependency on foreign oil; cooperative, held a grand opening foreign oil — which is a must for our • To reduce pollution by producing ceremony in August at its $80 million, country,” Skelton said. clean, biodegradable fuel. 210-acre soybean-crushing and More than 1,000 producers from biodiesel plant near Deerfield, in west- Missouri and several nearby states share Ocean Spray opens world’s central Missouri. The plant, the first in the ownership and profits of the largest cranberry-processing phase of which began operating last fall, operation. The co-op’s equity drive in facility will eventually convert 21 million 2005 raised more than $36 million in Ocean Spray has completed the bushels of soybeans annually into soy less than four months. The average per- expansion of its facility at Wisconsin oil, which will then be processed into producer investment was about 30 million gallons of biodiesel fuel. $36,000. With the opening of the soybean- USDA Rural Development provided crushing portion of the facility (which a Value Added Producers Grant of had been using purchased soy oil), the $100,000 in 2005 to help advance the plant is now fully operational. In project. addition to biodiesel, it will produce The plant employs about 40 people about 486,000 tons of soybean meal for and is expected to generate more than livestock feed. $250 million in sales annually. Missouri Congressman Ike Skelton Co-op General Manager John and representatives for Kansas Senator Nelson says the co-op has three Sam Brownback and Missouri Senator primary goals: Kit Bond joined local officials for the • To provide soybean producers with a celebration. “Renewable fuels like value-added solution to marketing

30 November/December / Rural Cooperatives Rapids, Wis., doubling the plant’s size featured as ingredients in more than state’s most abundant renewable to 440,000 square feet, making it the 1,000 different grocery, bakery and resources — and provide power to largest cranberry processing plant in the dairy products internationally. OPC’s 38 member co-ops, which supply world. electricity to nearly half of Georgia’s “Ocean Spray is exactly the kind of AMPI names new CEO population. company we are excited to have here in Associated Milk Producers Inc. “With our abundant biomass Wisconsin,” Governor Jim Doyle said (AMPI) has named Ed Welch as the resources, Georgia has the unique at an event celebrating the completion. cooperative’s president and chief opportunity to expand our use of “I am pleased the state is able to partner executive officer (CEO). He alternative energy, grow our with Ocean Spray to expand their succeeded Mark Furth, who economy and transform the facility in Wisconsin Rapids, and create is retiring after 38 years way we provide energy to 100 jobs for hardworking Wisconsin with AMPI, the last 19 as our citizens,” says Georgia families.” president and CEO, on Oct. Governor Sonny Perdue. “The Ocean Spray brand is stronger 1. “Oglethorpe Power’s than ever,” added Randy Papadellis, Welch, the current AMPI pioneering investment in president and CEO of Ocean Spray. “As chief operating officer alternative energy is we commemorate the expansion of the (COO), has held various consistent with our goal to Wisconsin Rapids sweetened dried leadership positions during grow, convert, and use cranberry production plant, we his 25 years with the biomass energy to power reinforce Ocean Spray’s partnership Midwest milk marketing our homes and businesses.” with the state of Wisconsin and our cooperative. He managed Ed Welch OPC has secured dedication to growing more cranberries AMPI cheese manufacturing options for five potential and creating additional jobs in the plants and member services sites in Appling, Echols, Badger State. If we can build on this in western Wisconsin before being Warren and Washington counties. The partnership and add more cranberries, named the cooperative’s COO. In that first two biomass power plants are there could be even more added role, he has led AMPI dairy scheduled to be built and placed into expansion and jobs at this facility in the manufacturing and marketing efforts. operation in 2014 and 2015. A third future…but we need the fruit.” “The AMPI board of directors unit could also be completed and placed Ocean Spray invested $75 million, searched for an effective leader to take into service in 2015. the largest capital investment the the helm of AMPI. We found that Capital investment in the biomass company has made in a manufacturing leader in longtime AMPI employee Ed plants will range from $400 million to facility, to add two sweetened dried Welch,” says AMPI Chairman Paul $500 million per facility, with each cranberry production lines to the Toft, a dairy producer from Rice Lake, providing about 40 full-time jobs. In Wisconsin Rapids plant. The facility Wis. “AMPI’s dedication to dairy addition, each plant will require an incorporates some of the latest farmers and our reputation in the dairy annual investment of more than $30 technologies in energy and industry will continue to grow under million for fuel stock alone and will environmental efficiency, bringing the Ed’s leadership. He understands the create a need for potentially hundreds total incremental investment in the AMPI vision and the cooperative of new jobs in the state’s forestry facility to over $90 million during the foundation on which we are built.” industry. past three years. Welch, a graduate of the University The power plants will be steam- These additions include a wastewater of Minnesota, is currently a member of electric generation stations using treatment facility, energy-efficient the American Dairy Products Institute conventional fluidized bed boiler/steam lighting and an expansion of the system board and a past president of the turbine technology. Fuel for the plants that converts methane from the Veolia Wisconsin Dairy Products Association. will consist of a woody biomass mixture, Cranberry Creek Landfill into clean including processed roundwood energy to power the plant. A fully- Oglethorpe Power to build (chipped pulpwood), primary racked warehouse for both ingredients biomass power plants manufacturing residue (wood waste and finished goods allows increased Oglethorpe Power Corporation from sawmills) and harvest residue storage on a smaller footprint. (OPC), the nation’s largest power (wood remaining in forests after Global demand for Ocean Spray supply cooperative, has announced clearing). The plants will be designed to sweetened dried cranberries has plans to build as many as three 100- allow for the co-firing of other types of doubled during the past three years and megawatt (MW) biomass electric biomass, such as pecan hulls and peanut is expected to double again over the generating facilities in Georgia. shells. There are no plans to use any next three years. Currently, Ocean Designed as carbon-neutral, the plants fossil fuels. Spray sweetened dried cranberries are will use woody biomass — one of the “With 12 million people expected to

Rural Cooperatives / November/December 2008 31 call Georgia home by the year 2030, we fund the Cooperative Development, Foremost board and its executive will need more energy to meet the Training and Research Center in committee. demand of our growing population,” Sumter County, Ala. This grant is “Ed has been instrumental in the said Chris Clark, executive director of expected to create and save more than formation and success of Foremost the Georgia Environmental Facilities 400 jobs, including those for 250 family Farms USA,” says Dave Fuhrmann, Authority. farmers and 100 fishermen. Foremost Farms president. “His In addition, two new rural contribution to this cooperative is USDA funds co-op centers cooperative development centers will nothing short of Agriculture Secretary Ed Schafer has be established with the funds remarkable.” announced that more than $4.5 million announced by Schafer: the Resource Scheevel, a in grants will go to 23 Rural Center for Value Added and Alternative graduate of the Cooperative Development Centers to Agriculture at North Carolina State University of improve rural economic conditions in University, and the Appalachian Forest Wisconsin-River 22 states. Schafer announced the Resource Center in Clarke County, Falls, is chairman funding investment during remarks at Ohio. of the Minnesota the 41st annual meeting of the USDA Rural Development helps Dairy Leaders Federation of Southern rural residents form cooperative Roundtable and Cooperatives/Land Assistance Fund businesses and improve the operations a member of the (Federation) in Epes, Ala. of existing cooperatives. It provides David Scheevel Southeast “Rural Cooperative Development technical assistance, conducts Minnesota Ag cooperative-related research and Alliance, the produces informational materials Minnesota Council of the Wisconsin (including this magazine) to promote Federation of Cooperatives and public understanding of cooperatives. Minnesota Association of Cooperatives Funding for individual recipients is (WFC-MAC). contingent upon their meeting the “These are challenging times in the conditions of the grant agreement. For dairy industry with escalating costs and a full list of the grants awarded, visit the uncertainty,” says Scheevel. “At the “News/Information room” at: same time, they are exciting times with www.rurdev.usda.gov. the emergence of international markets, milk supply growth in the Midwest and Ag Secretary Ed Schafer (far left) presents Minnesota dairy farmer Mideast, and growth in demand for a USDA Co-op Development Grant to Federation of Southern Co-ops to chair Foremost Farms finished products from this part of the officers (from left): President David Scheevel, a dairy producer U.S. I believe Foremost Farms USA is Woodrow Keown; Pam Madzima, co-op from Preston, Minn., has been elected in an excellent position to both meet development specialist; John Zippert, chairman of Foremost Farms USA. and be a major player in these changing director of program operations; Executive Scheevel has been on the board for markets.” Director Ralph Paige. Photo by more than 10 years, holding a variety of Heather Gray leadership positions, including second DFA adds Farm Services vice chair and secretary/treasurer. He Division; expanding plant has also been a member of the board’s capacity in Colorado Centers work closely to mentor personnel committee. Dairy Farmers of America (DFA) has entrepreneurs and grow local business Former chairman Edward Brooks formed a new Farm Services Division, with technical advice and research,” said indicated he would not seek another consolidating oversight of several Schafer. “This hometown support, close term as chairman after winning the member service programs, including at hand, strengthens jobs and Republican primary race for risk management, health insurance, opportunities throughout rural Wisconsin’s 50th Assembly District. financial services and bulk buying communities.” Brooks has been chairman of Foremost programs. Greg Wickham will serve as The 23 nonprofit groups and Farms and its predecessor, Wisconsin president of the division. He currently institutions of higher education selected Dairies Cooperative, for 18 years. serves as CEO of DFA-member may receive grants to finance up to 75 Brooks has been involved in the cooperative Dairylea and oversees percent of the cost to establish and leadership of cooperatives for more 30 Dairylea’s extensive agricultural services operate centers for cooperative years and has advocated cooperative and businesses, including several that are development. For example, with a farm issues at the state and federal currently in partnership with DFA. $200,000 grant, the Federation will levels. He continues to serve on the “Under Greg’s leadership of the

32 November/December / Rural Cooperatives Farm Services Division, we expect further collaborations between Dairylea and DFA in the farm services area that Washington farmers grow their own fuel will benefit members of both With the high energy demands of operating their vehicles and equipment, cooperatives,” says Rick Smith, farmers suffer from high fuel prices even more than most Americans. But a few president and CEO of DFA. producers in the Yakima Valley of Washington may have found a way to beat the Wickham will also continue in his system by growing their own fuel. current role as CEO of Dairylea and The Heritage Farm Cooperative is a small group of ethnic-minority farmers — chief operating officer of DFA’s mostly fruit, dairy and hops producers — who run their diesel engines on Northeast Area. Wickham has managed sunflower oil pressed from a crop grown on their own farms. The co-op, in the Northeast Area’s farm services team association with Flower Power USA, an engineering firm, provides technical for the past 10 years and was key to the assistance, business planning, conversion technology and crop-pressing formation of partnerships between DFA services. and Agri-Max Financial Services and Ion Manea, a sunflower farmer, founded the cooperative and Flower Power. Agri-Services health insurance. He’s originally from Romania, where sunflowers have long been an important Agri-Max Financial Services, of crop. Manea points out that using sunflower oil for diesel engines is an accepted which DFA is half owner, allows practice in Germany, where the majority of U.S.-made tractors now run on it. members to access complete dairy loan A farm with 12 percent of its cropland planted with sunflowers can produce packages for cattle, equipment and all its own fuel and save substantial amounts of money, Manea adds. The operating expenses. Members also may sunflower meal left over from crushing makes good cattle feed, and sunflowers buy farm supplies in bulk through DFA, fit well into crop rotation with the wheat and corn grown for feed in the valley. saving them money and time. The sunflower oil is not catalyzed into biodiesel, but is burned directly in DFA has also announced plans for a engines using an inexpensive conversion kit. It can be burned straight or blended $21 million expansion of a plant in Fort with regular petroleum diesel. The oil obtained from special sunflower varieties Morgan, Colo. Eastern Colorado’s milk (with an oleic acid content of 80 percent) provided by the co-op is ideal for this production is growing rapidly, with 120 purpose, says Manea. The high oleic content means it burns cleanly and doesn’t DFA member dairy farmers there gum up in diesel engines, unlike other kinds of straight vegetable oil. producing 144 million pounds of milk The cooperative brings crushing services to each member using a mobile per month. The expansion will create plant mounted on a 40-foot semitrailer. The oil is treated with ultrasound to seven new jobs and increase capacity by remove partially-dissolved gases that can cause problems in engines. Filters 2 million pounds per day. made with a special paper medium are necessary on engines burning the fuel. The Fort Morgan plant makes sweet Flower Power USA has won a USDA Rural Development Value-Added grant to cream, condensed milk and nonfat dry develop this technology. The firm has partnered with Heritage University, an milk, all ingredients used to make institution in Toppenish on the Yakima Indian reservation, to bring technical cheese, yogurt and ice cream. assistance to local small farmers. Manea says they are also considering using sunflower oil in the smudge pots Farm Credit System banks used to protect orchard crops from early freezes. “These tip over sometimes, and purchase $60 million of Farmer farmers don’t like having petroleum spilled around their trees,” he says. “Our oil Mac stock is harmless and biodegradable, as well as cheap.” The Farm Credit System in October — By Stephen Thompson, Assistant Editor announced it was making a $60 million investment in the Federal Agricultural Mortgage Corporation (Farmer Mac), which provides a secondary market for agricultural real estate loans, rural home mortgages and rural utility loans. Buying the senior cumulative perpetual preferred stock of Farmer Mac are: AgFirst FCB, AgriBank FCB, CoBank ACB, Farm Credit Bank of Texas and U.S. AgBank. An additional $5 million of Farmer Mac senior cumulative perpetual preferred stock has been purchased by Zions Bancorporation of Salt Lake City.

Rural Cooperatives / November/December 2008 33 The $65 million in total financing will Illinois and western Indiana. enable Farmer Mac to strengthen its capital position and comply with its CountryMark drilling for oil minimum regulatory capital across Illinois Basin region requirements. The Indiana-based “Farmer Mac enhances the CountryMark cooperative has availability of agricultural mortgages announced plans to drill for oil in and, more recently, rural utility loans, the Illinois Basin. The Illinois thereby assisting in the steady and Basin is a 53,000-square-mile dependable flow of capital to American depression under southern Illinois, farmers and ranchers and rural western Indiana and western America,” says Robert B. Engel, Kentucky. According to president and CEO of CoBank, CountryMark President and CEO speaking on behalf of his fellow System Charlie Smith, it is one of the most Bank presidents. “In that regard, plentiful sources of domestic crude Farmer Mac has been a valued partner oil in the Midwest. to the Farm Credit System, insurance “Approximately 40,000 barrels companies, commercial banks and the of crude oil are produced daily National Rural Utilities Cooperative from this region,” says Smith. Finance Corporation. “This is an extremely dependable, “Given the unprecedented turmoil in secure supply of energy for Indiana the broader financial services industry, and surrounding states.” at a time when so many institutions are CountryMark is the largest buyer struggling to maintain adequate levels of Illinois Basin crude and refines of capital and liquidity, we’re extremely the sweet crude at its Mt. Vernon pleased that the Farm Credit System is CountryMark cooperative is expanding Indiana refinery. favorably positioned to support Farmer its oil drilling efforts in the Illinois Basin. “As the productivity of old Mac through this new investment,” Photo courtesy CountryMark wells declines, it’s important that Engel adds. “Agriculture is a key CountryMark do its part to invest economic driver in our economy, the necessary capital for newer, providing food, thousands of jobs and delivery, lube oil and non-branded high tech recovery methods to biofuels that help make our nation transport fuel businesses. Details of the maintain, or even increase, the more energy-independent.” transaction were not disclosed. production of vital energy right here in Jamie B. Stewart Jr., president and Randy Handel, Effingham-Clay our own backyard,” Smith says. CEO of the Federal Farm Credit Banks general manager, says the deal allows To meet the needs of Indiana Funding Corporation, noted that the Effingham-Clay and Illini FS an businesses and growing world demand FCS continues to experience strong opportunity to continue a long tradition for energy, Smith says the co-op has overall financial performance. The of service to rural east-central Illinois elected to move from strictly System reported combined net income residents. “We have a strong tradition purchasing and refining American crude of over $1.5 billion in the first six of reliably supplying quality fuel and oil to becoming actively involved in months of 2008. As of June 30, 2008, lube oil products that today’s customers drilling. “We will also continue to credit quality in its $162 billion loan demand,” Handel says. purchase Illinois Basin crude, all of portfolio remained generally favorable, Effingham-Clay, founded in 1944, which will be refined at our plant in and liquidity and capital levels were in provides farm-related inputs, including southwest Indiana.” excess of all regulatory minimums, with feed, seed, plant food, crop protection, The company will invest in both the System’s combined assets totaled fuel, lubricants and grain marketing vertical and horizontal oil wells. $208 billion. services to farmers and rural residents in seven counties in east-central Illinois. Wisconsin co-ops Midwest local co-ops Illini FS provides ag-related products approve merger buy fuel business and services to farmers and rural Members of Country Horizons Effingham-Clay Service Co., Illini residents in east-central Illinois. Illini Cooperative and Valders Cooperative in FS and Lanman Oil Co. have FS, a division of GROWMARK Inc., eastern Wisconsin have approved a announced an agreement under which has offices in five counties. merger, which was effective Oct. 1. The the two agricultural cooperatives will Lanman Oil, founded in 1948, new cooperative will have eight purchase Lanman Oil’s farm fuel provides service to east-central locations and 200 employees, with

34 November/December / Rural Cooperatives projected sales of more than $85 Illinois co-op to Award for his contributions to million annually. The combined oper- build wind farm cooperatives. ations will be 40 percent ag services, 30 Plans have been announced by Baarda made numerous trips percent retail-based and 30 percent Prairie Power Cooperative to build a overseas to promote cooperatives and energy. 20-turbine wind farm in Pike County in advise govern-ments on cooperative About 75 percent of Valders western Illinois. The wind farm, laws, and has regularly taught a course Cooperative members approved the representing an investment of more on cooperative law at the University of merger, while 68 percent of Country than $65 million, will generate enough Arkansas’ Master of Laws program in Horizons Cooperative members power to supply 16,000 homes. Fayetteville, Ark. approved it. Voting was done both by This will be the first wind-power Baarda, who grew up on a small farm mail and at a membership meeting. project for Prairie Power, which in Iowa, earned a BS degree (chemistry, The co-op, which is working with a currently operates electrical plants physics and zoology) from Iowa State third-party advisor to determine its new powered by natural gas and coal. The University, a law degree from the name and some related issues, will be co-op says it will sell clean-energy University of Denver School of Law, governed by a nine-person board, with bonds to finance the project. and a PhD in economics from the five directors from Country Horizons The member-owned generation and University of Florida. and four from Valders Cooperative. transmission co-op produces, purchases He worked with what was then Robert Lowe, general manager of and delivers more than 1.5 million called USDA’s Farmer Cooperative Country Horizons, has been named megawatt-hours of electricity annually Service in Washington, D.C., for more CEO/general manager of the combined to its 11 member-owned electric than 16 years, and then spent four years company. He has more than 30 years of distribution cooperatives. These co-ops as vice president of education for the experience as a cooperative general provide retail electric service to more National Council of Farmer manager. than 83,000 consumer-members Cooperatives. After domestic and Lowe says members grasp the need throughout central Illinois. international consulting in Eastern for competitive buying and financing Europe and Former Soviet Union that only comes with combined USDA’s James Baarda retires republics, he joined a law firm in resources. “Cooperatives are unique in Dr. James Baarda, an agricultural Washington engaged in complex that decisions like these are made as economist with the Cooperative nationwide class action as well as other part of a collective group, the members Programs of USDA Rural Development litigation. and its board of directors,” Lowe says. in Washington D.C., retired Oct. 31. In 2001, Baarda returned to USDA, “Management and employees Baarda worked where he conducted research, writing, are here to help member-owned on a wide variety training and speaking activities. organizations remain of cooperative competitive and profitable so legal and USDA awards $1.8 billion in the cooperative can continue to economic issues electric loans return earnings to members.” during the past Agriculture Secretary Ed Schafer has “Our combined boards 30 years and is announced the selection of 33 rural believed it was the right time to considered by utilities and cooperatives in 26 states to merge, and I’m glad our many to be one receive $1.8 billion in loans to build and members supported that vision,” of the finest repair 7,600 miles of distribution and says Joe Holschbach, board cooperative transmission lines serving more than chair at Country Horizons and a minds and 90,000 rural customers. producer in the Manitowoc area. speakers in the “USDA partners with utilities across “Part of our past success has nation. the country to ensure the delivery of been around partnering with James Baarda His work in affordable, reliable electrical power to others,” says Paul Sorenson, recent years has rural communities,” Schafer says. board chair of Valders focused on the “These loans are investments that will Cooperative. “Our two legal, economic, spur or expand development cooperatives have worked together on financial and business characteristics of opportunities and enhance the numerous ventures, including the cooperatives that distinguish them from economic competitiveness for rural successful CP Feeds.” other forms of business in a dynamic, areas as good places to live and work.” The stock or equity held by global economy. Baarda is the recipient The funding is being provided members in each cooperative was of USDA’s Superior Service Award and through USDA Rural Development’s transferred Oct. 1 for equal value for the American Agricultural Law Utilities Programs. ■ equity in the new cooperative. Association’s Distinguished Service

Rural Cooperatives / November/December 2008 35 Vermont Dairy of Agriculture, Food and Markets. Kitsos. They follow Accepted continued from page 13 The projected payback period Agricultural Practices, established by “pencils out at 4.3 years, but in reality is the Vermont Agency of Agriculture, order to be sustainable and continue to closer to six years,” says Bill Rowell. which were designed to help farmers be viable in future years, needs sound “Right now, it’s not feasible for farms conserve and protect natural resources financial management,” says Tony with a small herd size to use this through regulated spreading of manure, Kitsos, a farm management educator technology,” Rogers points out. “For a crop rotation and installation of buffers with UVM Extension’s Farm Viability 100-cow operation, even a 300- or 400- along drainage ditches to control Enhancement Program. The Rowells cow operation, this isn’t an sediment, nutrients and pollutants in talk daily and consult with their economically sound option. But for runoff. financial advisors on a monthly basis to farms with high cow numbers, like this “We are all just stewards of the land, fine tune their ongoing financial one, capturing waste production and only here on earth for the time we are management strategy. recycling that waste into a usable com- granted,” Bill Rowell believes. “It is our The higher producing animals are modity makes smart economic sense.” responsibility to care for the land and milked three times a day. Their rolling The Rowells’ herd produces 10 resources until the next generation herd average is 22,000 pounds of milk million gallons of manure yearly, which takes over.” Both of Brian’s children, Matthew, 13, and Megan, 11, help out on the farm. “We are all just stewards of the land… Kitsos notes, “This dairy also is It is our responsibility to care for the land and working towards providing a scientific resources until the next generation takes over.” database for the state of Vermont and UVM for nutrient management in conjunction with its anaerobic digester and proposed settling pond, an per cow with 3.8 percent butterfat and is converted into enough methane to enhancement to the digester process.” 3.1 percent protein. To ensure that the produce 1.8 million kilowatt-hours of Off the farm, Brian has been a town herd gets proper nutrition, the Rowells electricity annually. The energy is selectman in Highgate for 15 years. Bill consult with two nutritionists every purchased by CVPS and sold to its was appointed by Governor Jim week. These recommendations enable customers interested in “green energy.” Douglas to the CVPS Rural them to feed their cows a total mixed The additional four cents per kilowatt- Development Executive Committee, ration of corn silage, haylage, and hour paid by the consumer goes to the which is charged with implementing grains, balanced according to the participating farmers and effectively clean energy projects in the state, and energy, protein, and fiber needs for covers the carbon offset, Brian Rowell was a member of the Dairy Task Force each group of cows according to their explains. that worked with the U.S. Secretary of stage of lactation. In addition to the projected revenue, Agriculture on the Farm Bill. He the process has resulted in other recently was asked to serve on the Managing manure for energy benefits. “It's lowered our somatic cell search committee for the new dean of As with any sizeable dairy operation, count,” Bill Rowell says, “and we are the UVM College of Agriculture and efficient management of manure is able to provide all our bedding needs Life Sciences and was instrumental in important. While many farmers invest for the milking cows.” He estimates the establishing the Farmers Wetlands in larger storage lagoons to handle the farm is saving $100,000 annually by Assistance Committee, which acts as a volume, the Rowells decided that an using the dry bio-solids from the liaison between Vermont’s dairy anaerobic methane digester system to treated manure instead of sawdust for producers and USDA/NRCS. turn manure into energy was a viable bedding in their state-of-the-art free- “Green Mountain Dairy will economic option for them. They were stall barns. They also supply dry continue to succeed into the future the third farm in Vermont to sign up bedding for two local farms and several because they have a sound vision of with Central Vermont Public Service nurseries and greenhouses. their business; are committed to solid (CVPS) for its Cow Power Program. dairy, economic, and environmental The installation of the digester cost Stewards of the land practices; and work with their families $2.37 million, which was offset partly The dairy farmers have developed a and employees to further the success of through $755,000 in grants from comprehensive nutrient management the farm,” Rogers concludes. “In USDA Rural Development, the plan in accordance with USDA’s addition, they are willing to try new Vermont Department of Public Natural Resources Conservation ideas that make sense, fit the farm, Service’s Clean Energy Development Service (NRCS) Nutrient Management improve the environment and help the Fund, CVPS and the Vermont Agency Conservation Standards, according to community.” ■

36 November/December / Rural Cooperatives 2008 Article Index Information appearing in Rural Cooperatives magazine during calendar year 2008 has been indexed to help you find past articles. Articles are indexed by issue and page. Back issues can be found on- line at: www.rurdev.usda.gov/rbs/pub/openmag.htm

TITLE FEATURES ...... ISSUE—PAGE Ag Versus Industrial Waste for Energy ...... March/April 29 Alto Dairy sold to Saputo Cheese USA ...... March/April 35 Art & science of energy independence ...... Jan./Feb. 26 Aurora Co-ops Centennial As it turns 100, Nebraska co-op still growing with most ambitious endeavor in its history ...... July/Aug. 10 Baltimore Biodiesel Micro co-op contends with growing pains in quest for cleaner air ...... May/June 28 Biodiesel at the Intersection Processors cope with high feedstock prices, eye impact of renewable diesel ...... May/June 22 Bison co-op helping Native Americans develop production, marketing strategy ...... Jan./Feb. 32 Calling All Co-ops! Carbon Credits for Farmers ...... Nov./Dec. 10 CCA salutes top co-op ...... Nov./Dec. 26 CDF’s multi-pronged efforts support co-op mission in America and abroad ...... Nov./Dec. 28 Charting a New Course Community-supported fishery project may help Maine fishing co-op stay afloat ...... Sept./Oct. 4 CHS, AGP weigh multiple factors for feedstock choices ...... May/June 25 Co-op Link to Sustainability NCFC study shows ‘farmer-owned’ message resonates with consumers on environment ...... July/Aug. 4 Co-op Summit slated for Indiana ...... July/Aug. 19 Co-op Vision & Mission ...... March/April 31 Co-ops ring up additional $14 billion in sales via other ownership structures ...... Nov./Dec. 18 Co-ops set new records for sales, income; Business volume tops $146 billion in 2007 ...... Sept./Oct. 19 Consumer cooperator achievements recognized ...... July/Aug. 41 Dairylea: A Century of Cooperation Track record shows ability to adapt in tumultuous times ...... Sept./Oct. 16 Danger, risk part of fishing trade ...... Sept./Oct. 6 Early disputes can derail co-ops ...... March/April 22 Ed Schafer takes reins at USDA ...... March/April 36 Energy innovators push technology curve ever forward ...... May/June 12 Farmers, Co-ops and Local Food Marketing ...... Sept./Oct. 10 Feeling the Squeeze Tomato growers take big hit in food scare ...... Sept./Oct. 13 Getting Connected Study sees USDA role in linking electricity from alternate energy sources to grid ...... Jan./Feb. 16 Grain Industry must evolve, adjust to a new market paradigm ...... Nov./Dec. 16 Great River Soy falls victim to soaring soybean oil prices ...... May/June 27 How the real salmonella culprit was found ...... Sept./Oct. 15 Idaho’s Bounty New food co-op helps meet growing demand for locally produced foods ...... May/June 4 Industrial lifecycle stages ...... March/April 15 Investor’s Manual New investment models could help reverse decline of local ownership of biofuel plants ...... Jan./Feb. 4 Largest 100 ag co-ops post record sales, margins ...... March/April 4

Rural Cooperatives / November/December 2008 37 Focus On… Lassoing Wyoming’s Wind Burnett Dairy Co-op; Alpha, Wisconsin ...... July/Aug. 32 Landowners band together to bargain for higher wind royalties ...... July/Aug. 8 Craftsmanship paried with technology as Bongards’ celebrates centennial . . .Nov./Dec. 8 Marketing advantages of the co-op business model ...... March/April 13 Michigan Turkey Cooperative Earns Product Center Award ...... May/June 35 In the Spotlight New Orleans group attends co-op development training ...... March/April 33 A Nice Guy Who Finished First North Wind Roy Orton’s track record at National Grape and CoBank earns top honors from Alaska Village Electric named top wind co-op ...... March/April 19 NCFC ...... March/April 25 Northwest Passage Mission to Market Co-ops Co-ops should be trail-blazers for bioenergy industries in MacDonald, NCBA Marking Committee work to expand public understanding of Northwest ...... March/April 12 cooperatives ...... Jan./Feb. 20 Organic and Beyond Consumer demand growing for differentiated farm products ...... March/April 16 Management Tip Overcoming constraints to growth in biofuels industry ...... Jan./Feb. 18 Co-op boards demonstrate leadership through strategic planning process . .Nov./Dec. 24 Ownership Manual Sharing the North Fork Canyon Run Study accesses four primary ownership models for biofuels ...... Jan./Feb. 10 Insights from game theory for cooperatives ...... Jan./Feb. 28 Paradigm shifting on nuclear power ...... May/June 10 Pledges for the future ...... May/June 11 Newsline Quilters co-op goes private ...... March/April 24 ‘Energizing Rural America’ theme of USDA Ag Outlook Conference ...... Jan./Feb. 38 Raising the Standard Income, revenue climb at Riceland Foods Ability to add value, meet needs fuels West Central’s growth ...... May/June 14 Brian Furnish to lead Burley Tobacco Co-op Renewable energy issues focus of WIREC 2008 ...... Jan./Feb. 12 GROWMARK, FS Seed Support Ag in the Classroom Rewards of Ownership Florida’s Natural squeezes out record revenue Community-based renewable energy projects can produce big benefits . .Nov./Dec. 4 Record earnings for CHS Sec. Schafer meets with NCFC leaders ...... July/Aug. 31 Pappajohn drops plan to acquire ethanol plants 75 Years of Chronicling Co-ops NCBA awarded $8 million grant to help Mozambique farmers Magazine pages reflect co-op progress, challenges, opportunities ...... Sept./Oct. 20 Blue Diamond sales hit $658 million 75 Years of Chronicling Co-ops, Part II Frederick named ‘Honored Cooperator’ On ‘the street’ and in cyberspace, Rural Cooperatives still South Central Grain to merge with CHS spreading word about power of co-ops business ...... July/Aug. 20 Florida sugar co-op and partner purchase Veracruz sugar plant 75 Years Strong: Oregon Cherry Co-op ...... March/April 7 Sunkist to consolidate citrus juice and oil units Sky’s the Limit! Housing co-op opens doors ...... Nov./Dec. 20 Walton EMC returns $3 million to members State of the Art Minn-Dak revenue tops $278 million Arts and crafts co-ops help members tap markets ...... March/April 20 Tapping farm equity key to greater local ownership ...... Jan./Feb. 7 Agri-Mark has record earnings ...... March/April 37 The New Quest for ‘Fire’ Snokist expanding processing; will exit fresh-produce sector Renewable energy experts come to grips with challenge of the century at Sioux Center ethanol plant to double fuel production WIREC ’08 ...... May/June 8 New biodiesel facility opens in Colorado USDA Rural Development funds available for disaster relief efforts ...... July/Aug. 34 Oemichen tells Senate panel about rural healthcare co-ops Using the ‘extra-value index’ to measure ag co-op performance ...... Jan./Feb. 22 ACE unveils new Web site Value definition can evolve during co-op’s life cycle ...... Jan./Feb. 36 Tennessee Farmers Co-op sets new sales record Valuing Your Co-op Co-ops to expand oilseed-crushing capability Meeting weighs value of co-ops in fast-changing business climate ...... Jan./Feb. 34 Fonterra delays farmers’ sale vote Vermont dairy farm turns manure into renewable energy ...... Nov./Dec. 13 NCBA’s Paul Hazen addresses U.N. on co-ops and job growth Washington farmers grow their own fuel ...... Nov./Dec. 33 USDA renewable energy studies on Web Washington organic farmer wins AFT top award ...... July/Aug. 39 Bill Davisson named chairman of NCFC Whatever It Takes Tobacco lawsuit ends with $100 million payment Land O’Lakes asks (and answers) some hard questions about its role in agribusiness ...... July/Aug. 16 Basin Electric forms wind subsidiary ...... May/June 31 Wheat co-op pays record dividends ...... Sept./Oct. 38 Sales, income soar for Land O’Lakes Whey to Ethanol Record $11.1 billion revenue for DFA Is there a biofuel role for dairy cooperatives? ...... March/April 10 CRI revenue tops $125 million AMPI’s Furth to retire following year of record income MAGAZINE DEPARTMENTS NCGA promotes bulk-buying options Co-op Development Action Co-op plans to buy N.D. hog plant Housing crises presents opportunity for co-ops for Landmark Co-op to build soy-crushing plant low- & moderate-income people ...... Sept./Oct. 40 Foremost reopens Waumandee cheese plant Maine Feeds Maine U.S. Premium Beef selling National Beef to JBS-Swift Teleconference aims to promote growth of state’s local food networks . .July/Aug. 18 CHS buys Provista Renewable Fuels, Spokane’s Zip Trip Poultry industry explores ecological options to save energy ...... Nov./Dec. 14 Tri-State joins renewable energy co-op Ride Sharing Organic Valley forms grower pool to ensure feed supply, price stability Equipment- and labor-sharing co-ops can help farmers Hanlin to succeed Lindgren at Sunkist save on rising costs ...... March/April 32 School’s In! Co-ops form new grain venture ...... July/Aug. 35 California parents create childcare co-op ...... Jan./Feb. 25 CWT program to be renewed for 2009 Denim mill creates Internet store for sustainable, American-made fabric Commentary New potato co-op formed A link to the past, present and future ...... July/Aug. 2 Pacific Northwest Farmers Co-op formed Biodiesel has important role to play in reducing greenhouse emissions ...... May/June 2 USDA staff lead co-op seminar for United Nations’ panel Capturing Value for Rural America: Strategic Choices for Renewable Southeast Milk to buy Winn-Dixie dairies Energy Investment ...... Jan./Feb. 2 NCBA: Cooperatives get a boost in Farm Bill Co-ops and the future of Rural America ...... Nov./Dec. 2 Masterfeeds to purchase Land O’Lakes Canada’s Ontario feed business Renewable energy: common goals, different paths ...... March/April 2 New CEO at Accelerated Genetics Stories behind the numbers ...... Sept./Oct. 2 USDA loans $266 million to nine rural electric co-ops

38 November/December / Rural Cooperatives Capacity boosted at CHS refinery Communications Growers sue Diamond in pay dispute CCA salutes top co-op communicators ...... Nov./Dec. 26 Falcone to lead National Grape Co-op, Welch’s FFA essay contest winners focus on co-ops Conferences DFA uncovers ‘improper’ payment to former chairman Energy innovators push technology curve ever forward ...... May/June 12 The New Quest for ‘Fire’ Farmer Co-ops Conference focus on stragegy, finance ...... Sept./Oct. 34 Renewable energy experts come to grips with challenge of the century at Peltier leaving NCFC to lead grape/wine group WIREC ’08 ...... May/June 8 United to expand feed facility Valuing Your Co-op Cal/West opens new HQ Meeting weighs value of co-ops in fast-changing business climate ...... Jan./Feb. 34 Virginia to build seafood market Webster Scholarship fund launched Co-op Development AGP announces sale of AGP Grain Ltd. Art & science of energy independence ...... Jan./Feb. 26 GROWMARK purchases fuels terminal Bison co-op helping Native Americans develop production ...... Jan./Feb. 32 Illinois & Iowa co-ops announce mergers CDF’s multi-pronged efforts support co-op mission in America and abroad Nov./Dec. 28 USDA awards $677 million to rural electric cooperatives Charting a New Course CHS Crop Nutrients expands Texas distribution facility Community-supported fishery project may help A&P Growers Co-op acquires Arizona orchards Maine fishing co-op stay afloat ...... Sept./Oct. 4 Student-designed device may protect utility workers Early disputes can derail co-ops ...... March/April 22 Knouse to cease applesauce production at Inwood plant Housing crisis presents opportunity for co-ops for low- & moderate-income people ...... Sept./Oct. 40 Prairie Pride biodiesel plant fully operational ...... Nov./Dec. 30 Idaho’s Bounty Ocean Spray opens world’s largest cranberry plant New food co-op helps meet growing demand for locally produced foods .May/June 4 AMPI names new CEO Lassoing Wyoming’s Wind Oglethorpe Power to build biomass power plants Landowners band together to bargain for higher wind-power royalties . . .July/Aug. 8 USDA funds co-op centers Maine Feeds Maine Minnesota dairy farmer to chair Foremost Farms Teleconference aims to promote growth of state’s local food networks . .July/Aug. 18 DFA adds Farm Services Division; explanding plant capacity in Colorado New Orleans group attends co-op development training ...... March/April 33 Farm Credit System banks purchase $60 million of Farmer Mac stock Rewards of Ownership Midwest local co-ops buy fuel business Community-based renewable energy projects can produce big benefits . .Nov./Dec. 4 CountryMark drilling for oil across Illinois Basin region Ride Sharing Wisconsin co-ops approve merger Equipment- and labor-sharing co-ops can help farmers USDA’s James Baarda retires save on rising costs ...... March/April 32 USDA awards $1.8 billion in electric loans School’s In! California parents create childcare co-op ...... Jan./Feb. 25 Page From the Past Sky’s the Limit! Housing co-op opens doors ...... Nov./Dec. 20 Cooperatives: tools for self-help ...... Jan./Feb. 47 Burlington Consumers Co-op exceeds goal in 20th year ...... March/April 44 Co-op Month Poultry industry sees exempt trucking ...... May/June 38 Calling All Co-ops! Co-ops urged to get involved in Co-op Month ’08 ...... Sept./Oct. 39 Utility Co-op Connection Mission to Market Co-ops Co-ops Get Serious About; Renewable Energy MacDonald, NCBA Marking Committee work to expand public understanding of Electric co-ops unite to form ‘Super REC’ ...... July/Aug. 14 cooperatives ...... Jan./Feb. 20 Keeping the Lights On RECs face huge challenge as energy demand grows at twice rate of new power Co-op Principles/Advantages/Theory generation ...... May/June 20 Co-op Vision & Mission ...... March/April 31 Lowering the Peak Marketing advantages of the co-op business model ...... March/April 13 Tornado impact prompts Illinois co-op to expand Northwest Passage demand-management program ...... March/April 34 Co-ops should be trail-blazers for bioenergy industries in Northwest March/April 12 Putting service ahead of profit helps utility co-ops win JD Power Award . . .Nov./Dec. 22 Sharing the North Fork Canyon Run South Carolina co-op pursuing three-pronged energy strategy ...... Jan./Feb. 31 Insights from game theory for cooperatives ...... Jan./Feb. 28 Valuing Your Co-op Value-Added Corner Meeting weighs value of co-ops in fast-changing business climate ...... Jan./Feb. 34 Ohio co-op’s soy-crushing plant produces for expanding trans-fat-free oil market ...... Jan./Feb. 27 Craft Co-ops Early disputes can derail co-ops ...... March/April 22 SUBJECTS State of the Art Anniversaries Arts and crafts co-ops help members tap markets ...... March/April 20 Aurora Co-ops Centennial Quilters co-op goes private ...... March/April 24 As it turns 100, Nebraska co-op still growing with most ambitious endeavor in its history ...... July/Aug. 10 Dairy Craftsmanship paried with technology as Alto Dairy sold to Saputo Cheese USA ...... March/April 35 Bongards’ celebrates centennial ...... Nov./Dec. 8 Burnett Dairy Co-op; Alpha, Wisconsin ...... July/Aug. 32 Dairylea: A Century of Cooperation Carbon Credits for Farmers ...... Nov./Dec. 10 Track record shows ability to adapt in tumultuous times ...... Sept./Oct. 16 Craftsmanship paried with technology as Bongards’ celebrates centennial . . .Nov./Dec. 8 Raising the Standard Dairylea: A Century of Cooperation Ability to add value, meet member needs fuels West Central’s growth . .May/June 14 Track record shows ability to adapt in tumultuous times ...... Sept./Oct. 16 75 Years of Chronicling Co-ops Vermont dairy farm turns manure into renewable energy ...... Nov./Dec. 13 Magazine pages reflect co-op progress, challenges, opportunities ...... Sept./Oct. 20 Whatever It Takes 75 Years of Chronicling Co-ops, Part II Land O’Lakes asks (and answers) some hard questions On ‘the street’ and in cyberspace, Rural Cooperatives still spreading about its role in agribusiness ...... July/Aug. 16 word about power of co-ops business ...... July/Aug. 20 Whey to Ethanol 75 Years Strong: Oregon Cherry Co-op ...... March/April 7 Is there a biofuel role for dairy cooperatives? ...... March/April 10

Rural Cooperatives / November/December 2008 39 Directors Sky’s the Limit! Housing co-op opens doors ...... Nov./Dec. 20 A Nice Guy Who Finished First Roy Orton’s track record at National Grape earns top honors from Livestock & Poultry NCFC ...... March/April 25 Bison co-op helping Native Americans develop production, marketing Co-op boards demonstrate leadership through strategic planning process . .Nov./Dec. 24 strategy ...... Jan./Feb. 32 Michigan Turkey Cooperative Earns Product Center Award ...... May/June 35 Education Poultry industry explores ecological options to save energy ...... Nov./Dec. 14 Calling All Co-ops! Co-ops urged to get involved in Co-op Month ’08 ...... Sept./Oct. 39 Management Co-ops Get Serious About; Renewable Energy Co-op boards demonstrate leadership through strategic planning process . .Nov./Dec. 24 Electric co-ops unite to form ‘Super REC’ ...... July/Aug. 14 Sharing the North Fork Canyon Run Mission to Market Co-ops Insights from game theory for cooperatives ...... Jan./Feb. 28 MacDonald, NCBA Marking Committee work to expand public understanding of Using the ‘extra-value index’ to measure ag co-op performance ...... Jan./Feb. 22 cooperatives ...... Jan./Feb. 20 Valuing Your Co-op New Orleans group attends co-op development training ...... March/April 33 Meeting weighs value of co-ops in fast-changing business climate ...... Jan./Feb. 34 School’s In! California parents create childcare co-op ...... Jan./Feb. 25 Marketing 75 Years of Chronicling Co-ops Baltimore Biodiesel Magazine pages reflect co-op progress, challenges, opportunities ...... Sept./Oct. 20 Micro co-op contends with growing pains in quest for cleaner air . . . . .May/June 28 75 Years of Chronicling Co-ops, Part II Biodiesel at the Intersection On ‘the street’ and in cyberspace, Rural Cooperatives still spreading word about Processors cope with high feedstock prices, eye impact of renewable power of co-ops business ...... July/Aug. 20 diesel ...... May/June 22 Co-op Link to Sustainability Finance/Tax/Legal NCFC study shows ‘farmer-owned’ message resonates with consumers on Getting Connected environment ...... July/Aug. 4 Study sees USDA role in linking electricity from alternate energy Co-ops ring up additional $14 billion in sales via other ownership structures Nov./Dec. 18 sources to grid ...... Jan./Feb. 16 Co-ops set new records for sales, income; Business volume tops $146 billion in Grain Industry must evolve, adjust to a new market paradigm ...... Nov./Dec. 16 2007 ...... Sept./Oct. 19 Investor’s Manual Dairylea: A Century of Cooperation New investment models could help reverse decline of local ownership of biofuel Track record shows ability to adapt in tumultuous times ...... Sept./Oct. 16 plants ...... Jan./Feb. 4 Farmers, Co-ops and Local Food Marketing ...... Sept./Oct. 10 Sec. Schafer meets with NCFC leaders ...... July/Aug. 31 Idaho’s Bounty Tapping farm equity key to greater local ownership ...... Jan./Feb. 7 New food co-op helps meet growing demand for locally produced foods .May/June 4 Largest 100 ag co-ops post record sales, margins ...... March/April 4 Fishing/Aquaculture Maine Feeds Maine Charting a New Course Teleconference aims to promote growth of state’s local food networks . .July/Aug. 18 Community-supported fishery project may help Mission to Market Co-ops Maine fishing co-op stay afloat ...... Sept./Oct. 4 MacDonald, NCBA Marking Committee work to expand public understanding of Danger, risk part of fishing trade ...... Sept./Oct. 6 cooperatives ...... Jan./Feb. 20 Organic and Beyond Food Safety Consumer demand growing for differentiated farm products ...... March/April 16 Feeling the Squeeze 75 Years Strong: Oregon Cherry Co-op ...... March/April 7 Tomato growers take big hit in food scare ...... Sept./Oct. 13 State of the Art How the real salmonella culprit was found ...... Sept./Oct. 15 Arts and crafts co-ops help members tap markets ...... March/April 20

Fruits, Nuts, Vegetables Member Relations A Nice Guy Who Finished First Whatever It Takes Roy Orton’s track record at National Grape earns top honors ...... March/April 25 Land O’Lakes asks (and answers) some hard questions about its role in Co-op Link to Sustainability agribusiness ...... July/Aug. 16 NCFC study shows ‘farmer-owned’ message resonates with consumers on environment ...... July/Aug. 4 Renewable Energy Feeling the Squeeze Ag Versus Industrial Waste for Energy ...... March/April 29 Tomato growers take big hit in food scare ...... Sept./Oct. 13 Baltimore Biodiesel How the real salmonella culprit was found ...... Sept./Oct. 15 Micro co-op contends with growing pains in quest for cleaner air . . . . .May/June 28 75 Years Strong: Oregon Cherry Co-op ...... March/April 7 Biodiesel at the Intersection Processors cope with high feedstock prices, eye impact of Grains & Oilseeds renewable diesel ...... May/June 22 Aurora Co-op’s Centennial Carbon Credits for Farmers ...... Nov./Dec. 10 As it turns 100, Nebraska co-op still growing with ambitious endeavor . .July/Aug. 10 CHS, AGP weigh multiple factors for feedstock choices ...... May/June 25 Biodiesel at the Intersection Co-ops Get Serious About Renewable Energy Processors cope with high feedstock prices, eye impact of renewable Electric co-ops unite to form ‘Super REC’ ...... July/Aug. 14 diesel ...... May/June 22 Energy innovators push technology curve ever forward ...... May/June 12 CHS, AGP weigh multiple factors for feedstock choices ...... May/June 25 Getting Connected Grain Industry must evolve, adjust to a new market paradigm ...... Nov./Dec. 16 Study sees USDA role in linking electricity from alternate energy sources to Great River Soy falls victim to soaring soybean oil prices ...... May/June 27 grid ...... Jan./Feb. 16 Ohio co-op’s soy-crushing plant produces for expanding Great River Soy falls victim to soaring soybean oil prices ...... May/June 27 trans-fat-free oil market ...... Jan./Feb. 27 Investor’s Manual Overcoming constraints to growth in biofuels industry ...... Jan./Feb. 18 New investment models could help reverse decline of local ownership of biofuel Raising the Standard plants ...... Jan./Feb. 4 Ability to add value, meet member needs fuels West Central’s growth . .May/June 14 Keeping the Lights On RECs face huge challenge as energy demand grows at twice rate of new power Housing Co-ops generation ...... May/June 20 Housing crisis presents opportunity for co-ops for low- & moderate-income Lassoing Wyoming’s Wind people ...... Sept./Oct. 40 Landowners band together to bargain for higher wind-power royalties . . .July/Aug. 8

40 November/December / Rural Cooperatives Northwest Passage Utility Co-ops Co-ops should be trail-blazers for bioenergy industries in Co-ops Get Serious About; Renewable Energy Northwest ...... March/April 12 Electric co-ops unite to form ‘Super REC’ ...... July/Aug. 14 North Wind Getting Connected Alaska Village Electric named top wind co-op ...... March/April 19 Study sees USDA role in linking electricity from alternate energy sources to Overcoming constraints to growth in biofuels industry ...... Jan./Feb. 18 grid ...... Jan./Feb. 16 Ownership Manual Keeping the Lights On Study accesses four primary ownership models for biofuels ...... Jan./Feb. 10 RECs face huge challenge as energy demand grows at twice rate Poultry industry explores ecological options to save energy ...... Nov./Dec. 14 of new power generation ...... May/June 20 Raising the Standard Lowering the Peak Ability to add value, meet member needs fuels West Central’s growth . .May/June 14 Tornado impact prompts Illinois co-op to expand demand-management Rewards of Ownership program ...... March/April 34 Community-based renewable energy projects can North Wind produce big benefits ...... Nov./Dec. 4 Alaska Village Electric named top wind co-op ...... March/April 19 South Carolina co-op pursuing three-pronged energy strategy ...... Jan./Feb. 31 Putting service ahead of profit helps utility co-ops win Tapping farm equity key to greater local ownership ...... Jan./Feb. 7 JD Power Award ...... Nov./Dec. 22 The New Quest for ‘Fire’ South Carolina co-op pursuing three-pronged energy strategy ...... Jan./Feb. 31 Renewable energy experts come to grips with challenge of the century at WIREC ’08 ...... May/June 8 Value Added Vermont dairy farm turns manure into renewable energy ...... Nov./Dec. 13 Burnett Dairy Co-op; Alpha, Wisconsin ...... July/Aug. 32 Whey to Ethanol Michigan Turkey Cooperative Earns Product Center Award ...... May/June 35 Is there a biofuel role for dairy cooperatives? ...... March/April 10 Ohio co-op’s soy-crushing plant produces for expanding trans-fat-free oil market ...... Jan./Feb. 27 Statistics Co-ops ring up additional $14 billion in sales via other AUTHORS ownership structures ...... Nov./Dec. 18 Atwood, Lindsay Co-ops set new records for sales, income; Business volume tops Co-ops Get Serious About Renewable Energy $146 billion in 2007 ...... Sept./Oct. 19 Electric co-ops unite to form ‘Super REC’ ...... July/Aug. 14 Largest 100 ag co-ops post record sales, margins ...... March/April 4 Idaho’s Bounty New co-op helps meet growing demand for locally produced foods . . . . .May/June 4 Supply Mission to Market Co-ops Aurora Co-op’s Centennial MacDonald, NCBA Marking Committee work to expand public As it turns 100, Nebraska co-op still growing with most ambitious understanding of cooperatives ...... Jan./Feb. 20 endeavor in its history ...... July/Aug. 10 Quilters co-op goes private ...... March/April 24 Co-ops set new records for sales, income; Business volume tops $146 billion State of the Art in 2007 ...... Sept./Oct. 19 Arts and crafts co-ops help members tap markets ...... March/April 20 Largest 100 ag co-ops post record sales, margins ...... March/April 4 Raising the Standard Borst, Alan Ability to add value, meet member needs fuels West Central’s growth . .May/June 14 Farmers, Co-ops and Local Food Marketing ...... Sept./Oct. 10 Whatever It Takes Getting Connected Land O’Lakes asks (and answers) some hard questions about its role in Study sees USDA role in linking electricity from alternate energy agribusiness ...... July/Aug. 16 sources to grid ...... Jan./Feb. 16

Sustainable/Local/Organic Bowden, Melanie Charting a New Course School’s In! Community-supported fishery project may help Maine fishing co-op stay California parents create childcare co-op ...... Jan./Feb. 25 afloat ...... Sept./Oct. 4 Consumer cooperator achievements recognized ...... July/Aug. 41 Bowman, Eric Co-op Link to Sustainability Northwest Passage NCFC study shows ‘farmer-owned’ message resonates with consumers on Co-ops should be trail-blazers for bioenergy industries environment ...... July/Aug. 4 in Northwest ...... March/April 12 Farmers, Co-ops and Local Food Marketing ...... Sept./Oct. 10 Idaho’s Bounty Brockhouse, Bill New food co-op helps meet growing demand for locally produced foods .May/June 4 Lassoing Wyoming’s Wind Maine Feeds Maine Landowners band together to bargain for higher Teleconference aims to promote growth of state’s local food networks . .July/Aug. 18 wind-power royalties ...... July/Aug. 8 Organic and Beyond Consumer demand growing for differentiated farm products ...... March/April 16 Campbell, Dan A link to the past, present and future ...... July/Aug. 2 Technology/Machinery Alto Dairy sold to Saputo Cheese USA ...... March/April 35 A Nice Guy Who Finished First Charting a New Course Roy Orton’s track record at National Grape and CoBank earns top honors from Community-supported fishery project may help NCFC ...... March/April 25 Maine fishing co-op stay afloat ...... Sept./Oct. 4 Ag Versus Industrial Waste for Energy ...... March/April 29 Danger, risk part of fishing trade ...... Sept./Oct. 6 Energy innovators push technology curve ever forward ...... May/June 12 Energy innovators push technology curve ever forward ...... May/June 12 Lowering the Peak Raising the Standard Tornado impact prompts Illinois co-op to expand demand-management Ability to add value, meet member needs fuels West Central’s growth . .May/June 14 program ...... March/April 34 75 Years of Chronicling Co-ops Ride Sharing Magazine pages reflect co-op progress, challenges, opportunities ...... Sept./Oct. 20 Equipment- and labor-sharing co-ops can help farmers save on rising 75 Years of Chronicling Co-ops, Part II costs ...... March/April 32 On ‘the street’ and in cyberspace, Rural Cooperatives still spreading word about power of co-ops business ...... July/Aug. 20 Transportation Sky’s the Limit! Housing co-op opens door ...... Nov./Dec. 20 Overcoming constraints to growth in biofuels industry ...... Jan./Feb. 18 Stories behind the numbers ...... Sept./Oct. 2

Rural Cooperatives / November/December 2008 41 The New Quest for ‘Fire’ Jones, Michael Renewable energy experts come to grips with challenge of the century at Ohio co-op’s soy-crushing plant produces for expanding trans-fat-free oil WIREC ’08 ...... May/June 8 market ...... Jan./Feb. 27

Chesnick, David Liebrand, Carolyn Investor’s Manual Carbon Credits for Farmers ...... Nov./Dec. 10 New investment models could help reverse decline of local ownership of biofuel Using the ‘extra-value index’ to measure ag co-op performance ...... Jan./Feb. 22 plants ...... Jan.Feb. 4 Largest 100 ag co-ops post record sales, margins ...... March/April 4 Lies, Mitch Tapping farm equity key to greater local ownership ...... Jan./Feb. 7 75 Years Strong: Oregon Cherry Co-op ...... March/April 7

Coontz, E. Kim Ling, K. Charles Housing crisis presents opportunity for co-ops for low- & moderate-income Carbon Credits for Farmers ...... Nov./Dec. 10 people ...... Sept./Oct. 40 Whey to Ethanol Is there a biofuel role for dairy cooperatives? ...... March/April 10 Crooks, Anthony Biodiesel at the Intersection Livingston, Jane Processors cope with high feedstock prices, eye impact of renewable Art & science of energy independence ...... Jan./Feb. 26 diesel ...... May/June 22 Maine Feeds Maine CHS, AGP weigh multiple factors for feedstock choices ...... May/June 25 Teleconference aims to promote growth of state’s local food networks . .July/Aug. 18 Ownership Manual Ride Sharing Study accesses four primary ownership models for biofuels ...... Jan./Feb. 10 Equipment- and labor-sharing co-ops can help farmers save on rising costs ...... March/April 32 Curti, Julie Rewards of Ownership Mayberry, Anne Community-based renewable energy projects can produce big benefits . .Nov./Dec. 4 Keeping the Lights On RECs face huge challenge as energy demand grows at twice rate of new power Daughrity, Patricia generation ...... May/June 20 A Nice Guy Who Finished First Lowering the Peak Roy Orton’s track record at National Grape and CoBank earns top honors Tornado impact prompts Illinois co-op to expand demand-management from NCFC ...... March/April 25 program ...... March/April 34 Putting service ahead of profit helps utility co-ops win JD Power Award . . .Nov./Dec. 22 DiPofi, Phil South Carolina co-op pursuing three-pronged energy strategy ...... Jan./Feb. 31 Grain Industry must evolve, adjust to a new market paradigm ...... Nov./Dec. 16 Painter, Kathleen Dorr, Thomas Organic and Beyond Capturing Value for Rural America: Strategic Choices for Renewable Energy Consumer demand growing for differentiated farm products ...... March/April 16 Investment ...... Jan./Feb. 2 Co-ops and the future of Rural America ...... Nov./Dec. 2 Pitman, Lynn Renewable energy: common goals, different paths ...... March/April 2 Valuing Your Co-op Meeting weighs value of co-ops in fast-changing business climate ...... Jan./Feb. 34 Ebert, Jessica Ag Versus Industrial Waste for Energy ...... March/April 29 Reynolds, Bruce Sharing the North Fork Canyon Run Eversull, E. Eldon Insights from game theory for cooperatives ...... Jan./Feb. 28 Co-ops ring up additional $14 billion in sales via other ownership structures ...... Nov./Dec. 18 Schofer, Dan Largest 100 ag co-ops post record sales, margins ...... March/April 4 Bison co-op helping Native Americans develop production, marketing strategy ...... Jan./Feb. 32 Frederick, Donald A. Overcoming constraints to growth in biofuels industry ...... Jan./Feb. 18 Thomas, Steven CDF’s multi-pronged efforts support co-op mission in America and abroad Nov./Dec. 28 Freeman, Jean Co-op boards demonstrate leadership through strategic planning process . .Nov./Dec. 24 Thompson, Stephen Baltimore Biodiesel Goetz, Justin Micro co-op contends with growing pains in quest for cleaner air . . . . .May/June 28 Rewards of Ownership Feeling the Squeeze Community-based renewable energy projects can produce big benefits . .Nov./Dec. 4 Tomato growers take big hit in food scare ...... Sept./Oct. 13 How the real salmonella culprit was found ...... Sept./Oct. 15 Halvorsen, Lisa Washington farmers grow their own fuel ...... Nov./Dec. 33 Vermont dairy farm turns manure into renewable energy ...... Nov./Dec. 13 Todd, Anne Heckathorn, Carissa Burnett Dairy Co-op; Alpha, Wisconsin ...... July/Aug. 32 Calling All Co-ops! Craftsmanship paried with technology as Bongards’ celebrates centennial . . .Nov./Dec. 8 Co-ops urged to get involved in Co-op Month ’08 ...... Sept./Oct. 39 Dairylea: A Century of Cooperation Track record shows ability to adapt in tumultuous times ...... Sept./Oct. 16 Jobe, Joe Great River Soy falls victim to soaring soybean oil prices ...... May/June 27 Biodiesel has important role to play in reducing greenhouse gas emissions . . .May/June 2 Uptagraff, Donna Johnson, Mark S. Poultry industry explores ecological options to save energy ...... Nov./Dec. 14 Whatever It Takes Land O’Lakes asks (and answers) some hard questions about its role in agribusiness ...... July/Aug. 16

42 November/December / Rural Cooperatives

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