Our financial model allows for different levels of capital investment from members whilst at the same time ensuring a governance structure based on the principle of common ownership. We want to ensure that capital investment is secure but does not compromise the social relations required for the standard of development we are trying to implement.

The ALI is a not-for-profit co-operative company limited by guarantee owned by and serving it’s members. It works on similar principles to a co-housing or mutual home ownership scheme. The company owns the land but members hold the equity in the property in exchange for their capital investment through an Equity Loan Agreement. When a member wishes to leave the company, they can take their investment with them by selling this equity loan back to the company, or preferably, by finding a new member to buy them out.

New members can join with little or no capital so long as they are willing to work towards contributing a level of financial investment equal to an agreed value of their living space. This means that they would build their equity in the property by either repaying a mortgage or loans from other members or private investors.

We propose of an annual equity investment of at least £4,000 from people who join us with no capital, for several years. The company supports members in achieving this by creating the conditions for them to build up their own land-based livelihood providing the opportunity to work within one of the company businesses or by creating their own.

These opportunities to earn money through farm activities and on-site businesses reduce the need for members to travel outside to money-earning jobs. The operational rules for these businesses are described in our company by-laws. There are three types of businesses:

• ALI owned businesses
• ALI licensed businesses
• Private businesses

The company may also borrow money from members and other private investors through an interest-bearing loan agreement. We intend for this amount to be small, but we hope that having a degree of flexibility in refinancing the company will allow for more freedom if and when some members decide to move on. To this end we are arranging our finances with Triodos bank.

The external costs of the community (such as Council Tax, insurance, bulk food items, interest on loans) will be paid for out of a monthly service charge which will be paid by the people who are granted licences to live in the community. However, we will ensure that these costs are low. We will source the majority of our food supplies from the farm. Power will be supplied through on site electricity generation from hydro and PV systems, fuel will be provided through our wood harvesting and a bio-diesel processing units. In addition to this we will share vehicle and transport costs. We estimate that the approximate costs (including interest on loans) per person with 6 adults sharing would be in the region of £1,500 per annum.

According to this financial model, a member would only need to earn £6000 per year even if they started with no capital and therefore were unable to make an initial equity loan. Of course, they may choose to earn additional income to pay for personal items and may need more to invest in their living space or business development.