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Largest HOUR Loan in History
|by Paul Glover|
World's Largest Local Currency Loan: Ithaca HOURS Makes 3,000-HOUR ($30,000) Loan to Credit Union
The world's largest local currency loan to date has been made by the Ithaca HOUR system, in Ithaca, New York. Alternatives Federal Credit Union/CUSO received $30,000 in the form of 3,000 Ithaca HOURS. The HOURS will be spent to pay 5% of contract work for building the credit union's new headquarters at State and Fulton Streets.
"Alternatives Federal Credit Union pioneered HOUR use, since HOURS were first issued in 1991," said Bill Myers, manager of the credit union. "HOURS complement our mission of local re-investment." Myers says the credit union will spend the HOURS for plumbing, carpentry, electric work, and a wide range of other services, among about two dozen area contractors.
Ithaca HOURS are local paper money that began circulating in Ithaca in 1991. One HOUR equals an hour of basic labor or $10.00. "This is by far the largest of the 31 loans we have made thus far," said Dan Cogan, President of the Board of Ithaca HOURS, Inc. "It is a large step beyond our usual microloans of 10 to 100 HOURS" ($100 to $1,000). The AFCU loan will be repaid over ten years. The Ithaca HOUR system does not charge interest on loans. "The benefits of local currency loans spread throughout the entire community," he said, " The whole community earns community interest when accepting HOURS."
Thousands of area residents and over 466 businesses accept HOURS. Many are listed in HOUR Town, the system's quarterly directory. Millions of dollars worth of HOURS have been traded, according to Cogan. HOUR grants have been made to 54 community groups so far, totalling $9,581.25. During the past three years, the Cayuga Medical Center began accepting HOURS, the Ithaca Health Fund accepts HOURS for membership in its rudimentary "health security" system, the Public Library accepts HOURS for fines, and 200 additional businesses have enrolled, he said.
Cogan says that the expanded use of local currency could enable the community to accomplish additional work that dollars are less readily available for. He gave such examples as protecting local farmland, financing small business incubators, solar power, transporation alternatives, biulding low-cost innovative housing.
According to Bridgett DeBell, director of Conventions and Visitors for the Tompkins County Chamber of Commerce, "Ithaca HOURS are part of Ithaca's culture now. Locals are proud of the fact that we work together to make local currency happen. There's a level of trust involved that dollars don't require." The Chamber accepts HOURS for admission to its events. As a result of publicity, there are now about 65 HOUR systems operating worldwide, based on Ithaca's example.
HOUR Board Vicepresident LeGrace Benson said, "We've gradually and carefully expanded the HOUR supply, to make sure they circulate well," she said. "However, because of major media exposure, many HOURS have been taken from Ithaca as souvenirs. So this exceptionally large loan will quickly replenish the supply of HOURS.
"We are requesting tax-deductible donations of dollars to administer the expansion and take it to the next level. While many of our system expenses can be purchased with HOURS, it would still be inflationary to pay all our costs with HOURS. While we're working to make the network strong enough to rely entirely on HOURS we need bridge money."
Paul Glover is founder of Citizen Planners of Los Angeles (1983). He is author of "Where Does Ithaca's Food Come From" (1987) and "Ithaca Power" (Ithaca's fuel supply, 1988), and holds a degree in City Management.