The ALI provides a process for people to learn the skills and knowledge required to create resilient and self reliant land based livelihoods while at the same time earning an income and securing equity to enable them to invest in their future. We achieve this through a dynamic model of co-sufficient economy adapting a co-operative cohousing model for low impact community self-build projects designed specifically to facilitate the development of agroecological land based livelihoods. The property of the company is owned in common with all members but an investment from an individual member is secured against the value of their living space. A number of businesses and “brands” are owned by the company and developed by members not only to create an income for themselves but also, more generally, to further the aims of the organisation by supporting the creation of additional co-sufficient community farms.

With our emphasis on the importance of food sovereignty and agroecology all members will share a desire to work towards the realisation of greater economic autonomy without compromising the ability of future generations to meet their needs. Our Membership Agreement describes our values and principles and consent to abide by this ethos is a condition of joining the ALI.

Members can apply to join existing ALI projects or they can form a new community group and utilise the administrative infrastructure and businesses models to create new ALI co-housing self-build community farm projects.

Cohousing

What is cohousing? Cohousing communities are set up and run by their members for mutual benefit. Members are consciously committed to living as a community with shared values and a desire for mutual support and co-operation. They might share common space facilities, activities like community meals and other amenities such as laundries, heating systems, guest rooms, and transport. Ongoing developments within the community are designed to encourage conviviality and a sense of neighbourhood among members.

Many emerging communities or groups with an interest in creating a co-housing project face the problem of how to equitable raise finance to fund the development of the community. A common issue is that some members have money to invest from savings or inheritance while others through no fault of their own, have very little money. When entering into a co-housing scheme those with money often have concerns that they will lose the value of their investment subsumed within a common ownership organisation that could be manipulated by unscrupulous members. On the other hand, those without much money to invest may feel that there will be an imbalance in power with those investors assuming greater decision making rights with the threat of withdrawing their investment. Such suspicions are not congenial to the formation of trusting and open relationships so essential for building a strong community. We believe we have found a way through these difficulties

Community Equity

In short, we are adapting a type of equity membership cohousing or Mutual Home Ownership scheme that will allow for different levels of investment from members while retaining a principle of common ownership.

Firstly, it’s important to understand that the property is ‘owned’ by the company and therefore equally between all members. However, the company does not hold any equity in the property. Only Members hold equity in the property in exchange for their financial investment.

What is equity? In this case ‘equity’ simply means the value of an asset or property. If you have a mortgage with a bank you would still ‘own’ the house however, the bank would be entitled to a percentage of the equity. In the ALI the members hold the equity in the property. They own their financial investment which is secured against the value of the property but they do not have exclusive ownership rights. This has important consequences with regard to taxation but also with the development relationships within the community. In effect it separates capital, as finance, from property ownership.

This is not to say we want to disregard personal property. Members of the community will have their own living space, their own home. In fact the importance of “home ownership” is fundamental to the ethos of the ALI. However, they will not rent this living space through a lease. Members will instead have a ‘licence’ with the co-operative and pay a ‘‘service charge‘ that covers the running costs of the community. To have this licence to live in the community members must commit to the full amount of the value of their particular living space, a value determined by the members themselves. This will involve an ‘equity loan agreement’ equal to the value of the living space. If the member does not have the full amount of money to invest they loan what they can and make a commitment to a pay the full amount over a period of time.

Technically this means that a member’s capital is a loan against a living space or part of the value of the property as a whole. Therefore, we call this an “equity loan agreement” and because we have licences and service charges this investment is distinct from the members specific living arrangement meaning that the capital remains more flexible as is not subject to capital gains tax and stamp duty.

This model allows for prospective members with little capital to join and work towards building their equity for the future. So if some members hold more equity than the value of their living space this equity can be repaid by members who have yet to pay the full amount for their living space. Or if there is a mortgage on the property they can commit to repaying part of the mortgage.

Building Community

We hope to establish a diversity of community farms over the coming years. However, we have no interest in becoming a large land owning institution or housing association. Our aim is to help community groups get established as working co-sufficient community farms.

The membership process requires all new members to commit to our Membership Agreement, our shared values and principles that provide the foundation for the formation of our community farms. However, we want to ensure that we can have a diversity in expression of community land projects. We have no wish to create an homogeneous “one size fits all” model of farm. Of course, they will share a commitment to food sovereignty and the practice of agroecological land management but within this framework provided by the Membership Agreement there is room for a divergence in attitudes and ideologies shared by different groups. As such we ask each community group to develop Community Covenant that clearly describes the community’s shared beliefs and how they want to live together. To join a community it is an additional requirement (alongside the Membership Agreement) to agree to abide by the Community Covenant.

Therefore, although we allow for two levels of membership the process for joining a community is the same irrespective of whether you are already a member. This means we can attract skilled individuals and investors who may wish to support us but as yet don’t want to live as part of an ALI community. The time may come when they want to join an existing community but even if they are a committed and valued member of the ALI the community they wish to join must have the right to choose who they live with.

Joining an ALI Community Farm

For any member wishing to join a particular ALI community farm we ask that they rent for a six month period before fully committing, not only to make sure everyone gets on well but also to be sure that living as part of the community is right for them. In order to rent they must become an associate Residential Member of the particular community project they wish to join and commit to abide by the farm’s community covenant,

The rent they pay is the same as the general service charge that all community members pay. After the six month period, if it is decided by the community for the new resident member to join them, they agree on the value of the new member’s living space. They can then pay the full amount of the agreed value , or if they don’t have enough capital, agree to make a monthly payment for part of a mortgage or pay off loans from other private or investor members.

When they want to leave, they get their money back either by finding a new person to come in and join the community and take on the financial commitment on that space (similar to selling a house) or by selling the equity back to the company.

Under this system, because all members own everything, and, as full resident members we don’t ‘lease‘ or ‘rent‘ the property where and how you live is more flexible. This means you could move into one space and then (by agreement with the community) move over to another space that suits you better, with a suitable adjustment to your equity loan agreement, but no stamp duty or solicitor’s fees.