United States

Department of

Agriculture

Rural Business–

Cooperative

Service

RBS Research

Report 200

Measuring the Economic

Impact of Cooperatives

in Minnesota
Acknowledgments The author wishes to acknowledge the many individuals and organizations that assisted in the creation of this report:

Organizations: Minnesota Association of Cooperatives and Minnesota Secretary of

State’s office.

Project Assistant: Alison Behning

Reviewers: Mary Edwards, Saint Cloud State University; George Morse, University

of Minnesota; William F. Lazarus, University of Minnesota; Bruce

Reynolds, USDA Rural Business-Cooperative Service; James

Wadsworth, USDA Rural Business-Cooperative Service; Deb MillerSlipek, USDA Rural Development and Rob King, University of Minnesota

December 2003

i
Measuring the Economic Impact

of Cooperatives in Minnesota

Joe Folsom

USDA/Rural Development/Minnesota

I. Executive Summary

Cooperatives as a form of business have been a

part of Minnesota’s economic and cultural history. Its

1,026 cooperatives make it one of the leading states in

the country with this form of business structure. The

ability to collectively create an organizational structure

to meet community needs makes them an effective tool

for economic and community development.

Input-output analysis provides some measure of

quantifying economic and employment impacts of

businesses. With this tool, we can measure the direct

effects attributable to the firm, those resulting from

purchases made by the firm, and the induced effects as

a result of local spending by firms attributable to the

demand change resulting from the firm’s actions. The

study methodology measures the total impact and the

impact of local ownership and a single-level taxation.

Revenue data collected from 311 respondents to a

survey of Minnesota cooperatives was used for

IMPLAN, an input-output economic analysis software

tool. The value-added component within the IMPLAN

model includes employee compensation, proprietary

income, other property income, and indirect taxes.

Treating the "other property income" element as "proprietary income" determines the impact of local ownership and single level taxation.

Responding cooperatives represented 44 business

sectors and had 943,450 members, representing an estimated 50 percent of the total co-op membership. The

185 credit unions serve another 1,457,183 members.

The $6.07 billion in revenues generated by the 311

cooperatives and 185 credit unions result in total

direct, indirect, and induced impacts of $10.89 billion

in output and total employment of 79,363. Most significant, however, are the benefits attributable to local

ownership and single level taxation that increases $600

million in output, employment of 7,725, and tax revenues of $210.5 million.

The benefits of local ownership and single-level

taxation are also attributable to business structures

such as sole proprietorships with these characteristics.

Policy considerations should foster an environment

conducive to development of and investment in locally

owned business enterprises, such as cooperatives.

II. Introduction

Mention the word “cooperative “ in rural

Minnesota and the response will likely refer to the

local grain elevator, agricultural supply cooperative, or

rural electric cooperative. If the discussion were to go

further, one might hear the name Land O' Lakes or

CHS Cooperatives. Few know that the cooperative

form of business also includes Ace Hardware,

TruValue Hardware, Associated Press, REI, and

Roundy's Inc.

Minnesota is a leading State in the nation in

using the cooperative form of business with 841 cooperatives1 and 185 credit unions

(http://www.ncua.gov/data/directory/cudir.html,

April 26, 2002). Cooperatives have been a part of

1

1 Compilation of 2001 reregistrations of cooperatives and 2001

registrations of new cooperatives with the Minnesota Secretary of

State’s office.
Minnesota’s historical legacy, beginning with the opening of stores in rural communities for purchasing farm

production supplies in the 1860s.

What defines a business as a cooperative? The

definition is not universal, but in practice is considered

a democratically controlled business that is:

● User owned

● User controlled

● User benefited

It is often

supplemented

with the seven

principles adopted

by the

International

Cooperative

Alliance (ICA).

Just what is

the economic

impact of the

cooperative business structure on

the State’s economy and upon rural communities in particular? Having

some measure of the value shows that cooperatives are

an excellent tool in promoting rural economic growth

and leadership development.

III. Economic Development Tool

Cooperatives provide tangible and intangible

benefits to the communities in which they operate.

Martin and Stiefelmeyer cite numerous examples of

cooperatives and their strategic alliances enhancing

the rural communities they call home.

Congress, recognizing the value of cooperatives

in economic development, directed USDA’s Rural

Development to study the role cooperatives may fill in

rural development and economic development. This

report (Cooperatives and Rural Development, 1989)

provides numerous examples of the variety of cooperatives that have been used to meet member and community needs. It concludes that cooperatives can be an

effective economic development tool to meet challenges of market failure due to a lack of presence or

the need for the provision of goods and services.

Nadeau and Wilson (Merrett and Walzer, 2001)

conclude from their case studies looking at the positive

and negative impacts of cooperatives on communities

that "cooperative development can be an effective

strategy for creating and expanding locally based businesses and for creating and retaining jobs."

IV. Evaluating Economic 

Impact of Cooperatives

A review of published literature on the impact of

cooperatives in their community and region finds

researchers have generally used either the case study

approach, an analysis of the fiscal and employment

impacts related to the cooperative’s business, or some

form of analysis to evaluate impacts.

Case Study Approach

The case study approach has been used to evaluate the community and economic impact of cooperatives. Most recent research work has studied new generation cooperatives.2 Three reports that look at

specific impacts of these cooperatives on rural communities using the case study approach are "New

Generation Cooperatives: Case Studies Expanded 2001"

(Holmes et al.), "A Cooperative Approach to Local

Economic Development" (Merrett & Walzer), and "The

Impact of New Generation Cooperatives on Their

Communities" (Trechter et al., 2001).

"New Generation Cooperatives: Case Studies

Expanded 2001" focuses on the developmental process,

factors leading to success or failure, challenges, some

discussion on lessons learned, and community

impacts.

The book, "A Cooperative Approach to Local

Economic Development," has targeted a number of

objectives: first to provide information on new generation cooperatives and second to give its readers an

approach to improving the overall economic wellbeing of rural communities through awareness of the

cooperative form of business and how it can add value

to local resources. Economic impacts are quantified in

terms of annual sales and employment along with

impacts of a subjective nature such as environmental

concerns, access to goods, changes in communication,

education, and building leadership capacity.

2

ICA 7 Co-op Principles

● Voluntary and open membership

● Democratic member control

● Member’s economic participation

● Autonomy and independence

● Education, training and information

● Cooperation among cooperatives

● Concern for community

2 New Generation Cooperatives have defined or limited

membership, require up-front capital contribution, and have

delivery rights and obligations in the form of marketing

agreements tied to the up-front capital contribution. (Holmes et al,

2001).
The research objectives in the report, "The Impact

of New Generation Cooperatives on Their

Communities," are focused on how and why cooperatives contribute to economic development. Again, the

results are more descriptive in nature with some financial, employment, and statistical data provided. The

report discusses the difficulty in quantifying benefits

in dollar terms and concludes, "Because the relationship between cooperatives and their communities is so

important, cooperatives face the challenge of clearly

documenting and describing the benefits they create,

not just for their members but also for the broader

community (Trechter, 2001)."

The case study method does not lend itself to

quantifying the magnitude of the impacts, particularly

in terms of dollars. The measures evaluated are

process oriented and descriptive in nature. The

research done on these cooperatives indicates they

have an impact on their membership and communities. Lorendahl (1996) concluded in an earlier case

analysis of six cooperatives in Sweden "a scanning of

the literature shows their impact on local economic

development is a neglected research problem."

Fiscal/Employment/Income Impacts

The use of fiscal or employment changes takes us

a step closer to quantifying impacts. There has been no

recent work examining the cooperative sector as a

whole in Minnesota. In fact, until the recent reregistration of cooperatives in the State, there has been no

accurate data on their number within the State.

The best informational resource using this

approach has been the data collected by USDA’s Rural

Business-Cooperative Service in its annual survey of

agricultural and ethanol cooperatives. The reports give

us a fairly good state and national picture of the agricultural and cooperative sectors, but do not address

housing, consumer cooperatives, and other non-agricultural cooperatives. The most recent, "Farmer

Cooperative Statistics, 2000," includes 148 marketing,

154 farm supply and service, 36 rural electric cooperatives, and 35 rural credit unions in Minnesota. Gross

and net business volume for these sectors by State are

included.

The Centre for The Study of Co-operatives,

University of Saskatchewan, used a similar approach

in measuring the impact of cooperatives in the

province of Saskatchewan in its report, "An Economic

Impact Analysis of the Co-operative Sector in

Saskatchewan, Update 1998." Its report is broader than

the USDA report and includes all cooperatives and

sectors. Cooperatives are grouped into the categories

of agriculture and resource, community development,

recreation, childcare and preschool, retail and wholesale, financial, community service, and other. The

breadth of these categories and the sectors themselves

reflect the importance of this business structure in

community and economic development in the

province. Periodic reports to the province’s

Department of Justice was the primary source of the

data for the research report, which included financial

statement data, memberships, employment and wages,

and capital investment. Key statistics derived from

these data indicated that the 1,306 cooperatives in the

province through its 963,415 members generate $6.9

billion in revenue and directly employ 15,046 people.

Input-Output Analysis (I/O)

Input-output analysis measures economic

impacts businesses have on their local economies. It is

a model of the economy for a defined area such as

county or State and shows how we can view the interactions and behavior in that economic region on a sector basis. It measures the flows of economic transactions. The descriptive data provided by the analysis

will give us a more in depth perspective beyond the

direct impacts of our interactions in the economy being

studied.

The model predicts the effect a given change in

output will have on final demand within the economy.

These direct, indirect, and induced effects are defined

as follows:

● Direct effects are attributable to the actions of

the firm as a result of the change in final

demand.

● Indirect effects are generated in the regional

economy being studied resulting from purchases by the firm to meet the change in final

demand. An example would be the inputs purchased by the firm in response to the change in

production to meet the new final demand.

● Induced effects are the changes in local spending by households from income changes (primarily wages) as a result of the direct and indirect effects of the demand change.

These effects are expressed in the form of multipliers. Type I reflects the direct and indirect effects.

Type II includes the induced effects along with the

direct and indirect effects. Social Accounting Matrix

(SAM) multipliers include direct, indirect, and

induced effects. The SAM multiplier accounts for institutional trade flows and transactions within the economy such as Social Security and income tax. The output

3
analysis is based on the impact of changes in final

demand resulting from a change in expenditures

(shock) within the study area.

This analysis makes a number of assumptions

regarding the economy and its reaction to the shock

applied to it in the analysis (Shaffer, 1989 and Maki

and Lichty 2000). Assumptions applied to the model

include:

● Supply of labor and other resources are sufficient and don’t change prices.

● The percentage of imports relative to the economy as a whole will not change with demand.

● Household consumption will change in direct

proportion to its income.

● Production technology is known and fixed

resulting in constant production coefficients.

● There are no economies of scale.

● No substitution of inputs due to price changes.

Input-output models can be constructed in several ways. The methodologies require extensive work

using survey and non-survey techniques (Schaffer,

1999). For example, the North Dakota model was

developed from primary survey data from firms and

households in the State (Bangsund and Leistritz, 1998).

Fortunately, there are several sources available that can

either provide the models themselves or the tools for

constructing them that do not require conducting

extensive surveys. The most readily available are RIMS

and IMPLAN. RIMS is a product of the Regional

Economic Analysis Division of the Bureau of Economic

Analysis (BEA). The BEA can construct models for

states, counties and multi-county areas. IMPLAN is a

product of Minnesota IMPLAN Group, Inc. (MIG).

MIG markets IMPLAN as Windows-based software

with the necessary databases to construct models

based upon State, county, and zip code areas.

Research work to study the economic impact of

cooperatives has been conducted in North Dakota

using the North Dakota State model, in Wisconsin

using the IMPLAN model, and in Minnesota with a

single cooperative using IMPLAN. The models and

approaches used have both strengths and weaknesses.

North Dakota Model

The North Dakota model was used to study the

impact of cooperatives in that State in 1996 (Bhuyan

and Leistritz) and again in 2001 (Coon and Leistritz).

These two studies used surveys of all the cooperatives

in the State to gather information on revenues, number

of employees, future expansion and plans, expenses,

and taxes paid. The North Dakota input-output model

analyzed data to ascertain the impact of cooperatives

on the State economy. Direct and indirect effects were

measured.

The 2001 report estimated the economic contribution (direct plus indirect effect) from North Dakota’s

337 cooperatives, 26 utility cooperatives and 62 credit

unions at $5.2 billion. They provide 9,078 direct jobs

and secondary or induced job creation of 42,290.

Induced effects to personal income amounted to $1.9

billion (Coon and Leistritz, 2001).

The two North Dakota studies imply that if cooperative businesses did not exist, the products and services would neither be provided nor exist in the economy. This assumption does not compare one business

structure with another.

A third study conducted on the sugar beet sector

used the North Dakota model. This 1998 report,

"Economic Contribution of the Sugarbeet Industry to

North Dakota and Minnesota (Bangsund and

Leistritz)," measured the direct and indirect impacts of

the sugar beet sector in both states including the production stage. Total economic activity (direct and indirect) was estimated at $2.3 billion for both states with

about 55 percent attributed to Minnesota. Direct and

indirect impacts in the household sector were $350

million and $496 million, respectively. This study

linked the production and processing impacts, for

without each other neither would exist, as there are no

processing facilities in the region.

IMPLAN I/O Analysis

A recent University of Wisconsin Center for

Cooperatives report, "Assessing State and Community

Impacts of Agricultural and Rural Cooperatives,"

(Zeuli, 2002) was based upon the social accounting

matrix (SAM) using IMPLAN. The report found 17,413

fulltime and 6,021 part-time jobs directly created by

the 798 cooperatives in the State. When multiplier

effects are considered, this translates into support for

nearly 30,000 full-time jobs. Sales generated by the

cooperatives totaled $5.5 billion in the State.

To distinguish the impact of the cooperative organizational structure from other forms of business, the

economic impact of the cash patronage refunds3 distributed in the State was estimated. When the refunds

are measured, the direct effects amounted to $11.1 million, resulted in the support of 4,637 jobs and generated over $114 million in income (Zeuli, 2002). The

4

3 The cash portion returned to patrons based upon the amount of

business done with the cooperative.
authors noted the methodology did not account for the

organizational structure and differentiate the impacts

that may be attributed solely to the structure itself.

The IMPLAN model has also been used to measure the economic impact of individual cooperative

projects. For example, Golden Oval Eggs in Renville,

MN, was found to have direct economic impacts of

$51,035,000 and total direct, indirect, and induced

impacts of $60,425,073 (Merrett, Holmes, Walzer,

Brown. 2002).

V. Hypothesis and Research 

Methodology

Hypothesis

The economic value of cooperatives as measured

by employment, revenues or business volume, and net

income can be measured. The question unanswered is

whether the structure or form of business results in a

different level of economic impact in the community or

region. This study suggests that cooperatives, by

nature of their being locally owned and having benefits accrue to the local member-owners, result in a

higher level of impact than businesses such as a corporations where benefits (dividends) are mainly distributed outside the community and local ownership is

missing.

Research Methodology

RIMs and IMPLAN modeling tools use the most

current economic data. IMPLAN, however, provides

additional flexibility in use and the ability to work

with the value- added component of the economy. It

divides the value-added component into four sub components of 1) employee compensation, 2) proprietary

income, 3) other property type income, and 4) indirect

business taxes. Employee compensation is wage and

salary payments including benefits; proprietary

income consists of self-employed individuals; other

property type income consists of royalty payments,

rents and dividends including corporate profits and

dividends; and indirect business taxes consist primarily of sales and excise taxes.

To determine the impact of the cooperative business structure compared with the traditional investorowned firms, some assumptions and understanding of

the tax treatment and characteristics of cooperatives is

essential.

Cooperatives, like other business models, pay

taxes. Contrary to some perceptions they pay property,

sales, employment, and income taxes. Income taxes are

paid at the ownership level, providing a single-level

taxation, much like other business models such as sole

proprietorships, partnerships, sub-chapter S corporations, and limited liability companies.

Cooperatives are subject to the single level taxation for member-derived income and, in the case of

some agricultural cooperatives, the nonmember

income. Non-member-derived income is taxed at both

the organizational and ownership levels much like a

regular C corporation for all other situations.

Cooperatives are unique from other business

structures in that the earnings are not distributed

based upon investment, but rather on the use or

amount of business the owner/member conducts with

the cooperative. Cooperatives are locally owned and

the patronage or dividends received are spent locally

similar to profits in a sole proprietorship.

Proprietary income in the IMPLAN model is

treated as if it were all spent locally, or within the

region, and with single-level taxation. This would be

the same as treating patronage dividends as being

spent locally and with a single level of taxation in the

first round of spending. Within the IMPLAN model,

"other property income" is like subject to corporatelevel taxation with a leakage of revenues out of the

region. The assumed leakage is for payment to nonlocal investors who are not a part of the local economy

defined by the IMPLAN model. Treating cooperatives

in the model as if they were sole proprietorships will

show the benefits attributable to the cooperative business form.

The economic impact as measured by sector sales

will be applied to the model twice. The first measures

impacts using IMPLAN’s default values for proprietary and property income for the sectors and region

being studied. The second application will be performed with the value-added components modified by

treating "other property income" as if it were all proprietary income. This comparison will demonstrate

whether local ownership and single level taxation have

an impact on a local economy.

A survey of cooperatives in the State was conducted. The survey requested information necessary to

provide the input data into the input-output model.

Key data consisted of revenues by sector within the

5

4 Gross revenues for regional cooperatives and others with earnings

generated outside of Minnesota were reduced by the amount of

Out of State earnings. Gross revenues were also reduced by

intercooperative transactions to eliminate double counting.
state. The survey was sent to all registered cooperatives with a series of followup procedures for those

who did not respond. A copy of the survey and the

cover letter are included in Appendix A. Sector data

were compiled for the model.4

A careful review of survey responses eliminated

the potential for double counting, particularly for

inter-cooperative transactions.

Data produced and reported includes jobs, wage,

and salary income plus total income tax flows.

VI. Cooperative Minnesota Survey

In 1999, a list of 2,770 cooperatives registered in

the State was obtained from the Secretary of State’s

office. The list, however, did not contain current information. Cooperatives at the time were not required to

periodically reregister. Consequently, unless the

Secretary of State’s office was notified, it had no way

of knowing if the registered contact information was

current or even if the cooperative was in business. 

Backed by the Secretary of State’s office and the

Minnesota Association of Cooperatives, a periodic

reregistration requirement was passed by the

Minnesota legislature. The first required reregistration

was conducted during 2001. Copies of the submitted

reregistration forms were obtained from the Secretary

of State’s office and formed the core of the database of

cooperatives. Added to the reregistrations were cooperatives that had filed incorporation documents from

July 7, 1999 to Sept. 10, 2001.

The initial database of 880 names was reduced to

868. The survey (Exhibit A) was mailed on June 28,

2002 with cover letter from Minnesota Association of

Cooperatives. Results were compiled by USDA Rural

Development.

One hundred forty-five valid surveys were

returned. Sixteen were no longer in business, and 5

were not cooperatives. Forty-one of those who did not

reregister, but were included in the registration filings

from the time period July 7, 1999 to Sept. 10, 2001,

were returned "addressee unknown."

Follow-up phone calls were made to the nonrespondents with telephone numbers. The calls

focused on obtaining correct contact information,

membership numbers, sales information, and sector

data.

A follow-up mailing was conducted with those

cooperatives for whom correct addresses could be

found and for which we did not have phone numbers.

The number of active cooperatives in the State is 841

plus 185 credit unions for a total of 1,026. This is based

on the information from the Secretary of State reregistrations adjusting for known changes such as dissolutions, cooperatives known to still be operating and did

not reregister and those not required to reregister in

2001.

The Secretary of State’s office posted a listing of

dissolved cooperatives based upon the reregistrations.

A number of cooperatives listed as dissolved were still

operational. Some failed to reregister and some were

errors in the reregistration process. Refinement and

updating of the list of registered cooperatives is in

progress.

Credit unions were not surveyed. Data for the

period ending December 2001 for the credit unions

were taken from the National Credit Union

Administration (NCUA) data posted web site

(http://www.ncua.gov/data/custmqry.html).

VII. Economic Impact Analysis

A total of 429 cooperatives provided full or partial responses from the initial mailing, the subsequent

mailing and followup phone calls. These cooperatives

represent 44 of the 528 sectors in the IMPLAN industrial sector classification scheme. 

Cooperatives provide products and services for

agricultural marketing/supply, agricultural processing, electric, telephone, housing, debt collection,

shared purchasing, health care, funeral home, water

supply, recreational products, food, educational services, rural fire protection, worker owned businesses,

and craft marketing.

Minnesota’s 429 cooperatives have 943,450 members.

Gross revenues, including those derived from

operations outside of the State, were obtained from 311

cooperatives and amounted to $18.4 billion.

Adjustments to eliminate out-of-state revenues and

inter-cooperative transactions reduce the gross revenues of the respondents, for the purpose of determining economic impact, to $6.47 billion. The 311 were:

189 agricultural (supply, marketing, production and

processing), 49 utility (electric, telephone, TV and

radio), 24 housing, and 20 food cooperatives.

Minnesota’s 185 credit unions regulated by the

NCUA form that database. They generated

$743,856,020 in revenues, employed 4,112 employees,

and served 1,457,183 members in 2001.

6
7

Table 1—IMPLAN sectors represented by survey respondents

7 HOGS, PIGS AND SWINE 26 AGRICULTURAL, FORESTRY, FISHERY SERVICES

27 LANDSCAPE AND HORTICULTURAL SERVICES 48 NEW RESIDENTIAL STRUCTURES

49 NEW INDUSTRIAL AND COMMERCIAL

BUILDINGS 55 MAINTENANCE AND REPAIR, RESIDENTIAL

58 MEAT PACKING PLANTS 59 SAUSAGES AND OTHER PREPARED MEATS

60 POULTRY PROCESSING 61 CREAMERY BUTTER

62 CHEESE, NATURAL AND PROCESSED 64 ICE CREAM AND FROZEN DESSERTS

65 FLUID MILK 70 FROZEN FRUITS, JUICES AND VEGETABLES

72 FLOUR AND OTHER GRAIN MILL PRODUCTS 76 CORN MILLING

78 PREPARED FEEDS, N.E.C 79 BREAD, CAKE, AND RELATED PRODUCTS

81 SUGAR 138 WOOD KITCHEN CABINETS

210 PETROLEUM REFINING 435 MOTOR FREIGHT TRANSPORT AND

WAREHOUSING

440 TRANSPORTATION SERVICES 441 COMMUNICATIONS, EXCEPT RADIO AND TV

442 RADIO AND TV BROADCASTING 443 ELECTRIC SERVICES

447 WHOLESALE TRADE 449 GENERAL MERCHANDISE STORES

450 FOOD STORES 451 AUTOMOTIVE DEALERS & SERVICE STATIONS

455 MISCELLANEOUS RETAIL 456 BANKING

457 CREDIT AGENCIES 459 INSURANCE CARRIERS

460 INSURANCE AGENTS AND BROKERS 461 OWNER-OCCUPIED DWELLINGS

462 REAL ESTATE 463 HOTELS AND LODGING PLACES

464 LAUNDRY, CLEANING AND SHOE REPAIR 467 FUNERAL SERVICE AND CREMATORIES

479 AUTOMOBILE REPAIR AND SERVICES 482 MISCELLANEOUS REPAIR SHOPS

489 MEMBERSHIP SPORTS AND

RECREATION CLUBS 497 OTHER EDUCATIONAL SERVICES

501 RESIDENTIAL CARE 502 OTHER NONPROFIT ORGANIZATIONS

506 ENGINEERING, ARCHITECTURAL SERVICES 508 MANAGEMENT AND CONSULTING SERVICES

Table 2—Business Sector Capture ($ in millions)

Sector Total Revenue5 Cooperative portion6 Percentage cooperative

Dairy $3,261.93 $3,077.87 94

Sugar $761.59 $728.00 96

Electric $6,320.68 $514.54 8

Banking $13,089.27 $678.60 5

Soybean milling $554.37 $81.26 15

5 IMPLAN, 1999 Database, sum of industry output and total value added.

6 USDA, Rural Business-Cooperative Servive publication, “Farmer Cooperative Statistics, 2000.” and survey data.
Table 2 shows examples where cooperatives represent

a significant portion of the business activity in some

business sectors.

Overall Economic Impacts

The sum of the $6.47 billion in revenues from the

survey respondents and the $0.74 billion in credit

union revenues reduced by the default values for nonlocal portion of the trade flows results in $6.07 billion

in revenues to be applied to the Implan model.

Applying the $6.07 billion in revenues to a normal mix

of business structures including corporations, partnerships, limited liability companies, cooperatives and

sole proprietorships in the Implan model enables us to

ascertain the economic impact of local ownership and

tax implications of the cooperative business structures.

The results are summarized in Table 3.

Direct output impacts for the 311 cooperatives

and 185 credit unions are $6.721 billion. Using the

SAM multiplier, they in turn generate indirect and

induced impacts totaling $10.89 billion within the

Minnesota economy. Direct employment generated is

estimated at 45,922 with direct, indirect, and induced

employment generated estimated at 79,363. These estimates are based upon the first round of spending

(direct impacts) being 100 percent local and with a single level of taxation, a characteristic of cooperatives

and sole proprietorships.

The benefits of the local ownership amount to

$600 million in total economic impacts, an increased

level of employment of 7,725 jobs and State and local

tax impacts of $64 million.

Housing Cooperatives

Though not all housing cooperative respondents

provided revenue information, unit data was provided

and obtained for 91 housing cooperatives totaling

5,064 housing units. It is estimated there may be as

many as 230 housing cooperatives in the State based

upon a review of the non-respondents and communication with organizations associated with cooperative

housing. Housing cooperatives were treated as owneroccupied housing in the IMPLAN analysis. Owneroccupied housing generates no indirect impacts,

induced impacts or employment impacts. This is different from the construction of housing, which does

generate economic impact.

Agricultural Sector

It is estimated there are 347 agricultural cooperatives.7 One hundred eighty-nine responded to the survey and reported $5.455 billion in revenues. These 189

cooperatives generate $8.4 billion in economic impacts.

The USDA Rural Business-Cooperative Service

publication, "Farmer Cooperative tatistics, 2000," gathered data on 305 agricultural cooperatives for the year

1999 and reports net business volume of $9.3 billion.8

The net business volume has been adjusted for intercooperative transactions and non-local activities. Data

is summarized in Table 4.

Due to the cooperative types not matching fully

with the Implan sectors an input output analysis of

8

Table 3—Overall Economic Impacts ($ in millions) of the 311 respondents

Indirect Induced Total Direct State and Indirect State

Entity Total Output Output Output Direct Employment and Local Tax and Local Tax

Type Impactst Impacts Impacts Impacts Impact Impact Impact

Co-op $10,890 $2,267 $1,901 $6,721 79,363 $146 $476

Non-coop $10,290 $2,267 $1,301 $6,721 71,638 $116 $442

Difference $600 $0 $600 $0 7,725 $30 $34

7 Estimate is based upon the author’s review of the list of

agricultural cooperatives maintained by USDA Rural BusinessCooperative Service (1999), respondents to the survey, and

personal knowledge of the cooperatives comprising the database

of reregistered cooperatives.

8 Data covering operations of cooperatives, whoe businesss years

ended in calendar 1999, includes independent local cooperatives,

federations, centralized regionals, and those with mixed

organizational structures. Products marketed were allocated to the

States in which they were originated and farm supply sales were

allocated to the States in which they were sold; service volume and

other income were allocated to the States of origin when services

related to farm products marketed or to the State of destination

when related to farm supplies sold. Gross business volume

includes sales between cooperatives while net business volume

excludes such sales.
this data creates a best guess estimate. The author's

best estimate of the total economic impact of agricultural cooperatives in the State using the USDA data is

$17.257 billion with $647 million attributable to the

cooperative business structure.

Another approach to estimating the total impact

of the agricultural cooperatives is to extrapolate from

the survey results of the 311 cooperatives. The number

of agricultural cooperatives responding to the survey

represents 55 percent of the estimated number of agricultural cooperatives in the State and about 58 percent

of the known net revenues of the agricultural cooperatives in the State. Assuming the non-respondents are

similar in type and income as the respondents and one

adjusts for the non-responses, about $14.5 billion in

economic impact would be realized by the agricultural

cooperatives and a benefit attributable to the agricultural cooperative business structure of $439 million.

Credit Unions

The 185 credit unions generate total economic

impact of $1.059 billion. The benefit of local ownership

translates into $123 million when compared with the

rest of the banking sector.

Electric Cooperative Impacts

Minnesota has 43 electric distribution cooperatives and 3 generation and transmission cooperatives

9

Table 4—Summary of USDA cooperative data for Minnesota ($ in thousand)

Cooperative type Number Members Gross business volume Net business volume IMPLAN Sectors

Dairy 35 17,097 $3,538,065 $3,077,872 61,62,64,65

Fruit & Vegetable 3 221 $1,680 $1,680 447

Grain & Oilseed 94 52,651 $3,028,311 $2,162,165 447

Sugar 3 2,467 $728,081 $728,081 81

Misc. Mktg. 5 11,069 $920,260 $810,166 447

Total Marketing 143 85,225 $8,571,499 $7,082,996

Crop Protectants $323,664 $263,001 447

Feed $604,214 $420,152 447

Fertilizer $609,418 $358,865 447

Petroleum $712,220 $543,442 447

Seed $64,306 $48,170 447

Misc. $262,306 $222,648 447

Farm Supply 142 96,651 $2,576,129 $1,856,279

Services 20 5,026 $366,614 $366,614 26

Total 305 186,902 $11,514,242,000 $9,305,888,000

Source: USDA Rural Business-Cooperative Service publication, "Farmer Cooperative Statistics, 2000"

Table 5—Credit Union Impacts

Total Total State and

Total Output Indirect Output Induced Output Employment Local Tax

Entity Type Impacts Impacts Impacts Impact Impact

Credit union $1,059 $146 $234 6668 $133

Banking Sector $936 $146 $111 5087 $90

Difference $123 $0 $123 1581 $43
(GTE). The GTE’s provide power to the distribution

cooperatives. Thirty-eight of the distribution cooperatives responded to the survey and reported revenues

of $715,866,000. Revenues of the GTE cooperatives are

not included in the IMPLAN analysis to avoid double

counting. The impact of the power generation is captured in the indirect effects of the 39 distribution cooperatives, which serve 516,600 members.

This report does not address the aspect that if not

for the cooperative form of business in some areas the

services would not be available to community members. Rural electric cooperatives that were formed in

the early part of the 20th century are a prime example

of providing service in rural areas not served by

investor-owned firms. Consideration of this aspect

would increase overall impacts.

Tax impacts

The ability to keep the dividend and other property-type income within the local economy, in this case

the State of Minnesota, increases the level of household expenditures and employee compensation as a

result of the employment generated by the increase in

household expenditures. The result is an increase in

State and local tax revenue due to household expenditures of $43.1 million and State and local tax revenue

from increased employee compensation of $351 thousand. Indirect business taxes increase by $33.5 million

while enterprise (corporate) taxes decline by $13.1 million. The bulk of the corporate tax decline is in corporate profit taxes. Appendixes B and C detail the tax

impacts.

The net increase in tax revenues counters the perception that there is a loss in revenue due to singlelevel taxation with the cooperative business structure.

VIII. Summary

The analysis used as a tool provides some measure of quantifying economic and employment

impacts of Minnesota's cooperative businesses and in

particular the impact of local ownership and a single

level taxation.

The economic impact (direct, indirect, and

induced) from the 311 cooperatives and 185 credit

unions totals $10.89 billion and total estimated direct,

indirect, and induced employment of 79,365.

The net gain to the economy of the local ownership and single-level taxation as a result of the nature

of the cooperative business structure is $600 million. A

net gain in tax revenue of $210.5 million and 7,725 jobs

is also realized. The 311 cooperatives represent slightly

more than one-third of the cooperatives in the State.

The benefits are attributable to local ownership

and single-level taxation and being able to retain the

economic benefits, primarily in the form of profits and

dividends, within the local community. These are normal characteristics of cooperative and sole proprietorships. However, they may at times also be characteristics of other business structures such as limited

liability companies, partnership, and S corporations.

The results of this research demonstrate the value

of locally owned businesses. Policy considerations

should foster an environment conducive to the development and investment in local business enterprises

by community members. These policy considerations

include:

● Providing technical and financial resources for entrepreneurial business development that engage members of the community in local business development.

10

Table 6—Electric Cooperative Impacts ($ in million)

Total Total State and

Total Output Indirect Output Induced Output Employment Local Tax

Entity Type Impacts Impacts Impact Impact Impact

Credit union $1,059 $146 $234 6,668 $133

Electric Co-op $1,043 $74 $257 5,431 $196

Non-coop $876 $74 $90 3,283 $138

Difference $167 $0 $167 2,148 $58
● Supporting infrastructure that helps to develop and

grow locally owned businesses such as the small

business development centers, business incubators,

community development financial institutions, and

the various cooperative development programs.

● Developing and supporting programs that improve

the access to equity capital for locally developed

projects from local investors. This could include the

removal of the 8 percent cap on the payment of dividends on capital stock for cooperatives and creation

of a market forum for local investors and

businesses.9

● Tax incentives or credits for local investors for local

investments modeled after those now available for

investments made in designated communities such

as renewal communities and the empowerment and

enterprise zones.

● Supporting cooperative and/or collaborative purchasing alliances can reduce the cost of purchasing

non-local goods and services. This has been very

effective for schools, non-profit organizations, and

local governments in a number of Minnesota rural

communities.

● Using cooperative models to reduce costs and provide access to services that are either unavailable or

at high cost such as cooperative and/or collaborative purchasing alliances for healthcare insurance

and wellness programs.

These are just a few ideas for consideration and

discussion that have the potential to increase local

investment within local communities and foster local

community development.

IX. References

Bangsund, Dean and F. Larry Leistritz. 1998."The 

Economic Contribution of the Sugarbeet Industry

to North Dakota and Minnesota." AE395

Department of Agricultural Economics, North

Dakota State University.

Bhuyan and F. Larry Leistritz. 1996. "Economic 

Impacts of Cooperatives Make in North Dakota."

AE96009 Department of Agricultural Economics,

North Dakota State University.

Coon, Randal C. and F. Larry Leistritz. 2001. 

"Economic Contribution North Dakota

Cooperatives Make to the State Economy."

AE20011 Department of Agricultural Economics,

North Dakota State University.

Herman, Roger and Murray Fulton. 2001. "An 

Economic Impact Analysis of the Co-operative

Sector in Saskatchewan, Update 1998." Centre for

The Study of Co-operatives, University of

Saskatchewan Canada.

Holmes, Mary, Norman Walzer, Christopher D. 

Merrett. 2001. " New Generation Cooperatives:

Case Studies Expanded 2001." p.1.

Kraenzle, Charles A., Ralph M. Richardson, Celestine 

C. Adams, Katherine DeVille, and Jacqueline E.

Penn. 2000. "Farmer Cooperative Statistics 1999."

RBS Service Report 59.

Lindall, Scott A. and Douglas C. Olson. 1996. "The 

IMPLAN Input-Output System." Stillwater MN.

Lorendahl, Bengt. 1996. "New Cooperatives and Local 

Development: A Study of Six Cases in Jämtland,

Sweden." Journal of Rural Studies, Vol. 12 No. 2

pp. 143-150.

Maki, Wilbur R and Richard W. Lichty. 2000. "Urban 

Regional Economics." Iowa State University

Press, Ames, pp.221-222.

Martin, Larry and Kate Steifemeyer. Chapter, "Strategic

Alliances and Cooperatives Aiding in Rural

Development in North America," and "Exploring

Policy Options for New Rural America." Kansas

City Federal Reserve Bank. p. 94.

Merrett, Chris, Mary Holmes, Norman Walzer, and 

Roger Brown. April 3, 2002. "New Generation

Cooperatives: Alternative Measures of Success."

Illinois Institute for Rural Affairs presentation at

Madison, WI, value-added conference.

11

9 Minnesota statute 308.131 limits the dividend paid on capital stock

to 8 percent thereby limiting a cooperative’s access to equity

capital where market and associated risk factors demand a higher

return than 8 percent.
Merrett, Christopher and Norman Walzer. 2001. 

Chapter 5, "New Generation Cooperatives and

Community Development" of "A Cooperative

Approach to Local Economic Development,"

Quorum Books.

Trechter, David, Robert King, et al., 2001."The Impact 

of New Generation Cooperatives on Their

Communities." USDA Rural BusinessCooperative Service Research Report 177.

Schaffer, William A. 1999. "Regional Impact Models." 

Regional Research Institute, West Virginia

University.

Shaffer, Ron. 1989. "Community Economics." Iowa 

State University Press, Ames, p. 275.

Stafford, Thomas, Alan Borst, Donald Frederick, 

Thomas Gray, Andrew Jermolowicz, and

Rosemary Mahoney. 1989. "Cooperatives and

Rural Development," USDA’s Agricultural

Cooperative Service.

Zeuli, Kimberly, Greg Lawless, Steven Deller, Robert 

Cropp, and Will Hughes. 2002. "Assessing State

and Community Impacts of Agricultural and

Rural Cooperatives." May 3, 2002. Final report to

USDA Rural Business-Cooperative Service to fulfill the requirements of contract RBS-99-23.

12
APPENDIXES

13
Appendix A, Survey Cover Letter and Survey

Economic Impact of Cooperatives

A Study by USDA Rural Development

Information in the box below (with the exception of email address) will go into a public directory.

Please correct any inaccurate information. An explanation of terms is on the back of this page.

ALL ANSWERS BELOW WILL BE KEPT STRICTLY CONFIDENTIAL

1. Membership: a. Total b. Minnesota . . . . . . . . . . . . .

2. Annual Meeting Month . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3. a. Total assets b. Total liabilities . . . . . . . . . .

4. Gross Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5. Expenditures: a. Operating b. Capital . . . . . . . . . . . . . . . .

6. Percentage of Expenditures Paid to Minnesota Firms & Employees . . . . . . . . . .

7. Please List up to 5 Primary Products/Services Provided By Your Cooperative :

Percentage of total sales

Product/Service associated with products/services

(SIC/NAICs code if known) (total should equal 100%)

8. Net Margin (Before Income Taxes and Distributions) . . . . . . . . . . . . . . . . . . . . . .

9. Unallocated equity retained for the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10. Cash Patronage Paid for the Year within MN . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11. Member equity revolved or paid out to MN members for the year . . . . . . . . . .

12. Patronage Retained for the Year within MN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

13. Federal Income Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

14. Minnesota Income Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15. Number of Full-Time Employees in Minnesota . . . . . . . . . . . . . . . . . . . . . . . . . . .

16. Number of Part-Time Employees in Minnesota . . . . . . . . . . . . . . . . . . . . . . . . . . .

17. Wages, Salaries & Benefits Paid in Minnesota . . . . . . . . . . . . . . . . . . . . . . . . . . . .

18. Estimated Number of Hours Employees and Directors Donate 

To Community Service and Community Activities . . . . . . . . . . . . . . . . . . . . . . .

Please check this box if you would like a copy of the study's summary results.

Thank you for taking the time to complete this survey.

14

Name of Cooperative:

Type of Cooperative: Open/Closed membership (circle one)

Board President:

General Manager/Contact:

Main

Address: 

Telephone: Web Page:

Fax: Email contact (confidential):

Use most recent fiscal year

a.

b.

c.

d.

e.

f. Other

Total 100%
Name of Cooperative- provide the legal name of the cooperative

Type of cooperative- for example: ag supply, ag marketing, dairy, housing, electric, worker, consumer, and ag

processing. If not sure, list products/services provided to the membership

Open/closed membership- please indicate if membership is open or if the cooperative has a defined or limited

number of members.

Board President- provide the name of the cooperative’s board president or chairperson.

General Manager/contact- provide the name of the general manager, CEO, or organizational contact

Main address- provide the legal or primary mailing address for the cooperative.

Telephone- provide the telephone number for the organization or organizational contact.

Web page- please provide the web address/URL if the cooperative has a website.

Fax- provide a fax number, if any for the cooperative or organizational contact.

Email contact- provide the e-mail address of the cooperative’s key contact.

1a. Total membership- provide the total number of members. If a regional or federated cooperative provide a

separate number for member cooperatives and individual members.

1b. Minnesota membership- provide the number of members based in Minnesota. If a regional or federated

cooperative, provide a separate number for member cooperatives and individual members.

2. Annual meeting month- indicate the month of the annual meeting.

3a. Total assets- provide the dollar value of total assets based upon the year end balance sheet from the last

completed fiscal year.

3b.Total liabilities- provide the dollar value of total liabilities not including equity based upon the year-end

balance sheet from the last completed fiscal year.

4. Gross sales- provide gross sales from the last complete fiscal year-end income statement.

5a. Operating expenditures- provide gross sales from the last complete fiscal year end income statement.

5b. Capital Expenditures- provide the total capital expenditures from the last completed fiscal year. Contained

in Statement of Cash Flows on the year-end financial statement, Cash Provided By (Used In) Investing

Activities.

6. The percentage of line 5 paid to Minnesota firms and employees- estimate this percentage if it is not readily

available.

7. Primary products and services provided by your cooperative- please list up to 5 primary products/services

your cooperative provides to members. If the NAICS or SIC code is known provide it. The percentage should

be based upon annual sales. The total should equal 100%. Products/services making up small percentage of

sales should be listed under Other.

8. Net margins earned or net profit-provide net margins or profits earned.

15
9. Unallocated equity retained for the year- provide the dollar amount of retained unallocated equity earned

for the past year.

10. Cash Patronage Paid for the Year within MN- provide the dollar amount of allocated cash patronage paid

on earnings from the past year.

11. Member equity revolved or paid out to MN members for the year- provide the dollar amount of member

equity retained form prior years (not including he most recent year) revolved or paid back to members.

12. Patronage Retained for the Year within MN- Provide the dollar amount of allotted patronage retained form

the most recent year’s earnings.

13. Federal Income Taxes- enter the amount paid for the most recent year.

14. Minnesota Income Taxes- enter state taxes paid for the most recent year.

15. Number of Full-Time Employees in Minnesota- provide the average number of full-time employees

employed in Minnesota.

16. Number of Part-Time Employees in Minnesota- provide the average number of full-time employees

employed in Minnesota.

17. Wages, Salaries & Benefits Paid in Minnesota- provide total wages, salaries and benefits paid to full-time

and part-time employees employed in Minnesota the past year.

18. Estimated Number of Hours Employees and Directors Donate To Community Service and Community

Activities- provide and estimate of the number of hours of service to community by employees and directors. Include uncompensated volunteer time for board meetings.

16
17

Appendix B, Non Cooperative Tax Impact

TAX IMPACT November 22, 2002

IMPACT NAME: non cooperative MULTIPLIER: Type SAM

Copyright MIG 2002 MN non 

cooperative.iap Indirect 

Employee Proprietary Household Enterprises Business

Compensation Income Expenditures (Corporations) Taxes Total

Transfers 2,067,588 2,067,588

Enterprices Total 2,067,588 0 0 0 0 2,067,588(Corporations)

Corporate Profits Tax 95,480,345 95,480,345

Indirect Bus Tax: Custom Duty 13,235,720 13,235,720

Federal Indirect Bus Tax: Excise Taxes 45,222,042 45,222,042Government Indirect Bus Tax: Fed NonTaxes 10,891,895 10,891,895NonDefense Personal Tax: Estate and Gift Tax 0

Personal Tax: Income Tax 235,782,844 235,782,844Personal Tax: NonTaxes (Fines- Fees) 2,379,120 2,379,120Social Ins Tax- Employee Contribution 127,089,379 14,427,032 141,516,411Social Ins Tax- Employ-er Contribution 132,107,710 132,107,710

Total 259,197,089 14,427,032 238,161,964 95,480,345 69,349,656 676,616,086

Corporate Profits Tax 20,561,437 20,561,437

State/ Dividends 228,205 228,205

Local Indirect Bus Tax: Motor Vehicle Lic 6,641,900 6,641,900

Govt

Continued
18

Appendix B, Non Cooperative Tax Impact (Continued)

TAX IMPACT November 22, 2002

IMPACT NAME: non cooperative MULTIPLIER: Type SAM

Copyright MIG 2002 MN non 

cooperative.iap Indirect 

Employee Proprietary Household Enterprises Business

Compensation Income Expenditures (Corporations) Taxes Total

NonEducation Indirect Bus Tax: Other Taxes 17,956,746 17,956,746

Indirect Bus Tax: Property Tax 173,351.241 173,351.241Indirect Bus Tax: S/L Non Taxes 47,656,558 47,656,558Indirect Bus Tax: Sales Tax 196,533,164 196,533,164Indirect Bus Tax: Severance Tax 89,097 89,097Personal Tax: Estate and Gift 0Personal Tax: Income Tax 77,597,015 77,597,015Personal Tax: Motor Vehicle Licence 5,763,712 5,763,712Personal Tax: NonTaxes (Fines- Fees) 5,424,571 5,424,571Personal Tax: Other Tax (Fish/Hunt) 1,569,868 1,569,868Personal Tax: Property Taxes 1,271,936 1,271,936Social Ins Tax- Employee Contribution 741,192 741,192Social Ins Tax- Employer Contribution 3,003,777 3,003,777

Total 3,744,969 0 91,627,102 20,789,642 442,228,706 558,390,419

Total 265,009,645 14,427,032 329,789,066 116,269,987 511,578,363 1,237,074,092
19

Appendix C, Cooperative Tax Impact 

TAX IMPACT November 22, 2002

IMPACT NAME: cooperative MULTIPLIER: Type SAM

Copyright MIG 2002 MN 

cooperative.iap Indirect 

Employee Proprietary Household Enterprises Business

Compensation Income Expenditures (Corporations) Taxes Total

Enterprices Transfers 2,261,189 2,261,829(Corporations)

Total 2,261,189 0 0 0 0 2,261,189

Corporate Profits Tax 35,426,855 35,426,855Indirect Bus Tax: Custom Duty 14,240,443 14,240,443

Federal Indirect Bus Tax: Excise Taxes 48,654,847 48,654,847Government Indirect Bus Tax: Fed NonTaxes 11,718,698 11,718,698NonDefense Personal Tax: Estate and Gift Tax 0

Personal Tax: Income Tax 348,483,562 348,483,562Personal Tax: NonTaxes (Fines- Fees) 3,516,304 3,516,304Social Ins Tax- Employee Contribution 139,028,871 77,472,199 216,501,070Social Ins Tax- Employer Contribution 144,518,653 144,518,653

Total 283,547,523 77,472,199 351,999,866 35,426,855 74,613,988 823,060,432

Continued
20 Appendix C, Cooperative Tax Impact (Continued)

TAX IMPACT November 22, 2002

IMPACT NAME: cooperative MULTIPLIER: Type SAM

Copyright MIG 2002 MN 

cooperative.iap Indirect 

Employee Proprietary Household Enterprises Business

Compensation Income Expenditures (Corporations) Taxes Total

Corporate Profits Tax 7,629,079 7,629,079Dividends 84,673 84,673Indirect Bus Tax: Motor Vehicle Lic 7,146,086 7,146,086

State/Local Indirect Bus Tax: Other Taxes 19,319,843 19,319,843Govt Indirect Bus Tax: Property Tax 186,510,333 186,510,333NonEducation Indirect Bus Tax: S/L NonTaxes 51,274,167 51,274,167

Indirect Bus Tax: Sales Tax 211,451,995 211,451,995Indirect Bus Tax: Severance Tax 95,860 95,860Personal Tax: Estate and Gift Tax 0Personal Tax: Income Tax 114,135,842 114,135,842Personal Tax: Motor Vehicle License 8,477,724 8,477,724Personal Tax: NonTaxes (Fines- Fees) 7,926,120 7,926,120Personal Tax: Other Tax (Fish/Hunt) 2,308,857 2,308,857Personal Tax: Property Taxes 1,858,492 1,858,492Social Ins Tax- Employee Contribution 810,823 810,823Social Ins Tax- Employer Contribution 3,285,969 3,285,969

Total 4,096,792 0 134,707,035 7,713,751 475,798,285 622,315,864Total 289,906,144 77,472,199 486,706,901 43,140,606 550,412.2 1,477,638.125
U.S. Department of Agriculture

Rural Business–Cooperative Service

Stop 3250

Washington, D.C. 20250-3250

Rural Business–Cooperative Service (RBS) provides research,

management, and educational assistance to cooperatives to

strengthen the economic position of farmers and other rural

residents. It works directly with cooperative leaders and

Federal and State agencies to improve organization,

leadership, and operation of cooperatives and to give guidance

to further development.

The cooperative segment of RBS (1) helps farmers and other

rural residents develop cooperatives to obtain supplies and

services at lower cost and to get better prices for products they

sell; (2) advises rural residents on developing existing

resources through cooperative action to enhance rural living;

(3) helps cooperatives improve services and operating

efficiency; (4) informs members, directors, employees, and the

public on how cooperatives work and benefit their members

and their communities; and (5) encourages international

cooperative programs. RBS also publishes research and

educational materials and issues Rural Cooperatives magazine.

The U.S. Department of Agriculture (USDA) prohibits

discrimination in all its programs and activities on the basis of

race, color, national origin, sex, religion, age, disability,

political beliefs, sexual orientation, and marital or family

status. (Not all prohibited bases apply to all programs.)

Persons with disabilities who require alternative means for

communication of program information (braille, large print,

audiotape, etc.) should contact USDA’s TARGET Center at

(202) 720-2600 (voice and TDD).

To file a complaint of discrimination, write USDA, Director,

Office of Civil Rights, Room 326-W, Whitten Building, 14th and

Independence Avenue, SW, Washington, D.C. 20250-9410 or

call (202) 720-5964 (voice or TDD). USDA is an equal

opportunity provider and employer.