Friday January 7, 2011

I was hoping to be able to report on the membership of Senate committees early today but there's been a short delay. The Senate is presently meeting in a joint caucus on the Senate floor for a briefing on Vermont's fiscal picture by the Joint Fiscal Office. After that, I expect the Senate will go into session and the assignments will be announced. As soon as I get them I will post the relevant committee memberships.
Senator Giard of Addison is introducing S. 7, a bill authorizing the creation of a new type of business entity- the limited cooperative association. Here’s the link to the bill:
A similar house bill was introduced January 30, 2009, referred to the House Commerce Committee; passed the House in February; and was referred to the Senate Committee on Agriculture where it died. It seems, this year,that the proponents want to try to get it through the Senate first.
You can find a summary of the bill here.It’s been adopted already in Nebraska, Oklahoma, and Utah. The National Conference of Commissioners on Uniform State Laws lists the following as why states should adopt this act:
“The ‘cooperative’ as a business entity is an important tool for economic development and business transactions in rural and urban settings. The industry encompasses many different forms of cooperatives organized for the common benefit of their members. Within recent years, the federal government’s interest in cooperatives has increased due to changes in farm subsidy programs, globalization pressures for larger and more flexible entities, and the utility and benefits of cooperatives as a business structure. Many states have considered revising their laws governing cooperatives, and several have enacted legislation to consolidate their special purpose cooperative statutes into a coherent, centralized statutory structure. However the law governing cooperatives in the states is in flux, and despite a growing and substantive trend toward broader, comprehensive, and more flexible governing statutes for the organizations, there is a marked lack of uniformity in the structure and development of such.

“The Uniform Limited Cooperative Association Act (ULCAA), drafted and approved by the National Conference of Commissioners on Uniform State Laws in 2007, addresses the need among the states for a centralized statutory scheme to govern cooperatives. The Act is designed to promote rural development by creating the option of a statutorily-defined entity that combines traditional cooperative values with modern financing mechanisms. The Act will be equally useful in an urban setting, where the cooperative value of individuals getting together to democratically own, run, and share in the benefit of their business can be combined with modern financing techniques. The ULCAA builds on traditional law governing cooperatives, but recognizes a growing trend toward the “New Generation Cooperative” (NGC), which can include combinations of features not readily available under traditional law, such as legally binding delivery contracts or the opportunity for outside equity investment. This Act creates a new form of business entity and is an alternative to other cooperative and unincorporated structures. It is more flexible than most current law, and provides a default template that encourages planners to utilize tested cooperative principles for a broad range of entities and purposes.”