Cascadian Energy Exchange (CEE)¶
“In community we trust”
Creating a Local Currency
A local currency provides an economic “cul-de-sac” that keeps wealth within a community. Local money tends to stay close to home. This means that profits do not get exported via chain stores and multinational corporations. (explain how money leaves community) Instead, people buy and sell goods and services among themselves, with the currency being an accounting tool.
Our society is fraught with a contradiction: on the one hand, we have vast needs that go unmet; on the other hand, we have vast amounts of labor, wasted resources, and productive capacity that could in principle meet those needs. Money is supposed to bring them together, but it is failing to do so. We can see a local complementary currency as a way to bridge the gap.
The value of printing our own money becomes very apparent when we watch Federal dollars come to town, shake a few hands, then leave to buy rainforest lumber and fight wars. Cascadian Energy Exchange hours, by contrast, stay in our region to help us hire each other. While dollars make us increasingly dependent on transnational corporations and bankers, CEE reinforces community trading and expands commerce that is more accountable to our concerns for ecology and social justice.
Community currency can be made to have similar security features as other world currency, they can be printed on locally-made paper, like handmade hemp paper, and/or with non-xeroxable thermal ink, all with serial numbers, all are harder to counterfeit than dollars.
Local currency is legal. CEE’s are taxable income when traded for professional goods or services. IRS and FED officials have been contacted by media, and repeatedly have said there is no prohibition of local currency, as long as it does not look like dollars, as long as denominations are at least $1.00 value, and if it is regarded as taxable income.
As we discover new ways to provide for each other, we replace dependence on imports. Yet our greater self-reliance, rather than isolating our local area, gives us more potential to reach outward with an ecological export industry. We can capitalize new businesses with interest-free loans of our own cash.
Cascadian Energy Exchange¶
Our current goal is to attain a “statement of interest” in Cascadian Energy Exchange (CEE) from as many local businesses as possible, no obligation is required. Once a substantial interest is obtained, from enough local businesses and services, we will begin to hold meetings to discuss how to begin. We would like to see acceptance of the currency by local bookstores, groceries, healthcare providers, crafters, farmers, farmer’s market vendors, restaurants, credit unions, Artisans, gas stations, and more.
CEE will not be dollar based, grain based, resource based, or gold based. CEE will be exchange based, or community based. Hence, ‘in community we trust’. Our local community IS the resource, our collective goods, our collective skills, and our collective labor. CEE seeks to simply be a representation of that abundance, an accounting tool for the fair exchange of those resources.
CEE’s will be a bottom-up design. Given to the common citizen for free, as a gift, by the members of Cascadian Energy Exchange. Some currency’s are lent into existence, others are spent into existence, CEE’s will be given into existence. CEE’s should always be seen as a gift.
Members would be considered those people who agree to accept payment, in full or partial, in CEE’s, and be included in the CEE directory. Participating members get the currency for free (minus printing costs), and would be given equitably their share of CEE notes, and would be in charge of distribution of the notes to their own customers and employees, for free. This could be in the form of bonuses to employee’s, and incentive’s to customers (for instance if over a certain sum of money is spent in one transaction, one CEE hour note could be given.) These customers/employees would be informed of participating businesses where they could spend their local notes. Then eventually the notes would come back to the distributing businesses, who could then spend them at participating locales, or give them back to interested customers as change for transaction, or straight exchange for federal reserve notes. This would essentially be an economic stimulus for the participating businesses. Ideally these businesses would already have common customers or regular business transactions between each other.
CEE members will decide via consensus when and how much money to print at any given time. This framework provides an excellent feedback system, as any member who feels they are getting more currency than they can spend, even after adjusting their acceptance levels, can block any proposal to print more currency.
In this way the CEE’s actually become active once they are given by the businesses to their customers and employee’s, along with a directory of where they are accepted. From this moment on they are given their ‘value’. This will increase customer loyalty, and do the business itself no financial harm so long as the business can keep the CEE’s circulating. By taking caution when printing, and by having membership spread along already existing business networks, and by spreading the CEE’s equally out among the community via the participating members, we ensure the money does not end up concentrated in any one place.
The success of a community currency depends completely on the number and kinds of people who will accept it. That acceptance must have high visibility. One of our goals is to gain recognition from the local government.
Participating retailers can place a sign in their window, with a recognizable logo, stating “We Accept Cascadian Energy Exchange.” We will print a quarterly newspaper which contains the directory of participants, and organize local business/barter fair events to bring people together, bumper stickers and brochures to educate the public on what a community currency is and how it works, as well as other print advertising. Avoiding long paragraphs of political rhetoric, the handouts can deliver short, declarative sentences, a list of websites and other resources.
The Cascadian Energy Exchange Unit can equal a Local Hour, based on a “living wage” (currently $10 per hour for a single adult as calculated for Lane County) So denominations in bills can go from ½ hour ($5) to 1 hour ($10) to up to 10 hours ($100). This provides an exchange rate to the CEE from the Dollar, while still leaving it independent from the changing value of the Federal Reserve Note. As living wage increases (the dollar’s value decreases) the value of CEE stays the same (increases compared to the dollar), maintaining a 1 hour living wage value. This lifts the lowest paid up without knocking down higher wages. As one CEE local hour has a minimum value of $10, while still leaving room to charge more than one CEE per hour.
Printing of said currency will be in the control of the members, real people that use and accept the currency. The meetings where printing is being decided can include economists (like local professors of economics), money experts (like from local credit unions), where their opinions can be heard. Decisions can be made by consensus.
Regarding when to print more currency, and how much, there must be an understanding of supply and demand. Namely, if too many notes are printed, there will be a surplus of CEE with not enough demand to exchange them. With too little CEE hours printed, there will not be enough to do the local economy any good.
expand the local money supply.
promote and expand local shopping, with an endless multiplier
increase the local minimum wage to $10.00, benefiting not only workers but businesses as well, who find new and loyal customers.
enable shoppers to afford premium prices for locally-crafted goods and services, and for locally-grown organic food.
help start new businesses and jobs.
reduce dependence on imports and transport fuels.
make grants to nonprofit community organizations, and make zero-interest loans.
stimulate community pride.
encourage the use of under-used resources.
Frequently Asked Questions
How does my business handle accounting for CEE?*
Treat CEE just as you would cash. Because the government views local currencies as a cash equivalent, no special accounting procedure is needed. However, until CEE is accepted for deposit at area banks, you will need to total these separately from U.S. Currency. Many businesses count and use local currency as petty cash.
How should my business set an acceptance policy?
You could accept 100% CEE for a transaction if you are able to spend them as quickly as you earn them. Other businesses may choose one day a week or some specific service or item for which they accept 100% CEE.
If you run a business that plans to accept CEE, you’ll want to set a reasonable acceptance policy. This can be a percentage of CEE you’ll accept on any given transaction, or it can be a set dollar amount of CEE. For example, a computer repair service may choose to accept 50% in CEE or simply say they’ll accept 1 CEE hour per job.
Accept more for services than for goods. For example, an auto mechanic might accept 1CEE hour + $20 per hour, but not accept CEE for parts.
Accept more CEE during slow business times. For example, a local restaurant could accept 25% CEE every day but Wednesday, when they accept 100%.
Accept more CEE for slow moving items or items connected to vendors that are members of CEE. For example, a winery can accept more CEE on last year’s stock, or for a ìpicnic kitî that combines wine with local processed foods or plates from a local potter.
How do I pay employees with CEE?
First, make sure employees are happy to accept a portion of their pay in CEE. Have them sign an acceptance contract. Assure them they can opt out at any time, and encourage them to consider how they will spend their CEE before they accept a high percentage.
Remember that you need to consider how many CEE your business will bring in as well as what the employees will accept.
At payroll time, figure the employee’s pay exactly as you normally would. Calculate the regular taxes and other deductions and determine the net pay. Now, subtract the amount in CEE each employee has agreed to accept (Remember 1 Cascadian Energy Exchange Unity=1 local hour=$10 USD). Most payroll programs have an “after-taxes deduction” space for medical savings accounts or other payments; include amount in CEE here. The resulting paycheck can be written, printed and direct deposited as usual. Now pay the remainder in CEE.
If you find your business doesn’t have enough CEE to meet payroll needs, adjust the ratio of apy as needed (and raise your acceptance level).
You can also give end of year bonuses in CEE, and employees can trade U.S. dollar tips for CEE.
Businesses can also use their CEE to reimburse consenting employees for out-of-pocket expenses that would normally be paid with petty cash.
How do I work with CEE at the cash register?
Use CEE to make change for purchases in CEE. You may offer CEE as change on any transaction if the customer agrees. Lots of tourists will be curious about Cascadia’s beautiful money and may view it as a souvenir.
While you may use U.S. dollars to make change for purchases in CEE, it is not recommended, particularly for businesses that have a low acceptance rate. Making change in U.S. dollars for purchases in CEE is like setting an acceptance rate at more than 100% and could result in receiving more CEE than your business can easily spend.
At the end of the day, during the daily accounting, treat CEE like cash. The only difference is that instead of going in to the deposit envelope, they should stay on site as a type of petty cash.
What is Local Currency?
Local Currency is paper money, or any other medium of exchange, issued by a community to add wealth to the local economy, to support locally owned businesses, and to enhance economic sustainability and social justice.
According to Paul Glover, founder of Ithaca Hours, America’s most successful local currency, local currency returns control over creation and distribution of money to communities in order to strengthen local trading, reinforce local business, make grants to community organizations, encourage equitable pay, and make new friends.
Has This Been Done Before?*
At least 60 communities in the US and Canada have local money systems. For instance, the internationally recognized system in Ithaca, New York where 1,500 people and 4000 businesses accept local currency in exchange for clothing, housing, movie tickets, massage, dentistry, legal advice, home repairs, bank fees, and hundreds of other services and goods.
What Is the CEE Based On? Where Does Its Value Come From?*
The same thing that gives US dollars value: the belief of the people who use them. CEE have a much smaller geographic and economic base than dollars, but the principle is the same. CEE is backed by our faith in our community—our demand for goods and services and the ability to provide them.
CEE is a medium of economic exchange, like cash, checks, frequent flier miles and gift certificates. Put another way, if CEE hours are in your pocket, you can spend them nearby for things you want and need. Knowing how, where, and why to use CEE is where the added value comes from. Every time you use CEE you are expressing a commitment to our community.
Because it is locally controlled, if high inflation in the national currency should arise, the CEE system can revalue its unit of account to a more equitable measure upon which the community agrees. Therefore the CEE system could be insulated from shocks if the national currency has a problem.
How do Individuals Get CEE hours?*
CEE’s are printed and distributed to the community via member businesses, individuals, and co-ops. They are freely given to their employee’s and customers alike. You could consider it a customer loyalty card for your business. This money will come back to the business, which can then be spent through other local participating businesses, or through employee paychecks, or via customers getting their change back in CEE’s.
Why Don’t All Member Businesses Accept 100% CEE For Goods or Services?
We recommend that businesses develop an acceptance policy that brings in CEE at a rate which they can reliably be spent. It is important for businesses and for the CEE system as a whole that CEE be spent soon—their value is realized as they circulate. Individual business circumstances differ, and all businesses always have the right to determine and change their own acceptance policy.
Who Controls The Supply Of CEE?
The issuance of CEE is managed by the Members of the Cascadian Energy Exchange. Issuance information will be public and posted regularly via web site.
Cascadian Energy Exchange Goals
To increase abundance.
To strengthen local community.
To be accepted by as many local businesses as possible.
To be accepted by local government.
Cascadian Energy Exchange Directory Wish List¶
Smith Family Bookstore
Natural healthcare providers
Yoga, Tai Chi, and dance instructors.
Local auto mechanics
Saurday Market Vendors