REPORT TO COUNCIL
SUBJECT
Title
Update on Worker Cooperative Initiative
Report
COUNCIL PILLAR
Promote and Enhance Economic, Housing and Transportation Development
BACKGROUND
The Worker Cooperative, or Employee Ownership, business model is values-driven and puts worker and community benefit at the core of its purpose. The two central characteristics of worker cooperatives are: 1) workers own the business and they participate in its financial success on the basis of their labor contribution to the cooperative and 2) workers have representation on and vote for the board of directors, adhering to the principle of one worker, one vote. Traditional economic development strategies rarely look at succession planning let alone providing resources to educate businesses about what options exist. Employee Ownership is an option that allows owners to retire well while keeping the business locally rooted. A majority if businesses in Santa Clara are small businesses and are the backbone of our community. This initiative will provide another tool in our toolkit to assist our businesses with succession planning with the hope of keeping them rooted and thriving in Santa Clara.
In July 2019 the City Council held a Study Session on the Worker Cooperative Business Model and referred the item to the Economic Development, Communications and Marketing (EDCM) Committee for review (Attachment 1 and 2). In November 2019, at the recommendation of the EDCM Committee, City Council allocated $100,000 toward the effort (Attachment 3).
The City adopted a Resolution No. 20-8823 in Support of Worker Cooperatives (Attachment 4) in March 2020 and over the Summer of 2020 entered into a contract with Project Equity to conduct a Business Landscape Analysis to help the City understand the risk to business retention among established companies, the potential future impact on jobs, business tax base, priority industry sectors, and economic development goals. Further, Project Equity will execut...
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