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Consumers’ Cooperatives in 1949:
Operations and Developments
Bulletin No. 1013
UNITED STATES DEPARTMENT OF LABOR
Maurice J. Tobin, Secretary
BUREAU OF LABOR STATISTICS
E wan Clague , Com m issioner
Consumers’ Cooperatives in 1949:
Operations and Developments
Bulletin No. 1013
UNITED STATES DEPARTMENT OF LABOR
Maurice J. Tobin, Secretary
BUREAU OF LABOR STATISTICS
E wan Clague , Com m issioner
For sale by the Superintendent of Documents, U. S. Government Printing Office, Washington 25, D. C.
Price 25 cents
Letter of Transmittal
U nited States D epartment op L abor,
B ureau of L abor Statistics,
W a s h in g to n , D . <7., J u n e 1 , 1 9 5 1 .
The Secretary
of
L abor :
I have the honor to transmit herewith a report on developments and
operations in the consumers’ cooperative movement in the United States in
1949, prepared by Florence E. Parker, of the Bureau’s Office of Labor
Economics.
E wan C lague, C o m m is s io n e r .
Hon. M aurice J. T obin,
S e c r e ta r y o f L a b o r .
Contents
Progress in 1949__________________________________________________________________
Local associations_____________________________________________________________
D istributive associations in 1949___________________________________________
Nonfarm associations_________________________________________________
Operating expenses; 1949______________________________________________
Trend of development, 1942-49________________________________________
Medical-care associations__________________________________________________
Housing associations______________________________________________________
Cold-storage associations__________________________________________________
Student cooperatives___________________________________________ v--------------Central organizations_________________________________________________________
Wholesale associations____________________________________________________
M embership_________________________________________________________
D istributive facilities_________________________________________________
D istributive and service operations-------------------------------------------------------Capital and resources_________________________________________________
Services of central cooperatives____________________________________________
Expansion of service facilities__________________________________________
Service business______________________________________________________
Resources of service federations________________________________________
Production by central cooperatives_________________________________________
Productive facilities of wholesales___________________________
Productive facilities of federations_____________________________________
Goods produced______________________________________________________
Resources of productive federations____________________________________
Em ploym ent and earnings, central cooperatives_____________________________
Labor and cooperatives________________________________________________________
Cooperative activity by unionists__________________________________________
Cooperative m anagers’ association_________________________________________
Cooperative aid to strikers________________________________________________
Pension plans for cooperative employees____________________________________
Legislation affecting cooperatives___________________________________________________
Federal law s__________________________________________________________________
State law s____________________________________________________________________
H ousing_________________________________________________________________
Medical care_____________________________________________________________
Electric-power cooperatives________________________________________________
Telephone cooperatives____________________________________________________
Credit unions_____________________________________________________________
Court decisions___________________________________________________________________
Insurance_____________________________________________________ :______________
H ousing______________________________________________________________________
Cooperative colony____________________________________________________________
T axation_____________________________________________________________________
International developm ents________________________________________________________
Cooperative principles_________________________________________________________
Underdeveloped countries_____________________________________________________
Petroleum products___________________________________________________________
Appendix— Cooperative medical care in 1949_______________________________________
(V)
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Consumers’ Cooperatives in 1949
Progress in 1949
In 1949, for the first time in many years, the
total money volume of business of both the store
and petroleum associations declined, the former by
1.3 percent and the latter by 0.2 percent. Despite
this loss in dollar volume, the stores handled a
greater tonnage of goods than in 1948. This is
indicated by the fact that the retail price level of
food, for example, declined over 4.4 percent in
the year period. On the other hand, the physical
volume of business done by the petroleum associa
tions showed a real decline, since the retail price
of petroleum products rose 2.7 percent from 1948
to 1949. The combined money volume of all the
retail distributive associations in 1949 amounted
to $1,215 bilhon.
Slightly over 80 percent of the store associations
showed earnings on operations in 1949. Nearly a
third of these had larger earnings than in 1948,
but 40.3 percent had smaller earnings. Almost
96 percent of the petroleum associations showed a
gain on operations in 1949. Slightly over half
had larger earnings than in the previous year, but
for 41.7 percent, earnings dropped.
Membership of both stores and gasoline associa
tions increased, though at a lower rate than in
either 1948 or 1947.
Among the local service cooperatives, slight
declines in membership took place in the coldstorage associations and those providing meals
and/or rooms, whereas membership of the funeral,
water-supply, medical-care, and housing associa
tions increased. Declines in volume of business
were shown by the funeral and cold-storage
cooperatives, but a greater business than in 1948
was attained by the housing and medical-care
associations and those providing meals and/or
rooms.
Another record year was attained by the credit
unions, with new peaks in membership, business
(loans granted), and assets.
More than 5,100 retail cooperatives were
affiliated with regional cooperative wholesales at
the end of 1949,1 or about 290 over the preceding
year. In turn, 24 of the regional wholesales were
members of the Nation-wide buying agency,
National Cooperatives, Inc.
The reporting regional and district wholesales
had a combined distributive and service business
of nearly $351 million—an increase of 7.4 percent
over 1948. This was achieved in spite of a 6.1percent decline in wholesale prices (all commodities
combined). Operating results were less satisfac
tory than for many years previously, however.
Of 28 regionals reporting, 6 had losses on the
year’s operations (as against only 2 in 1948).
These included several with a long record of
earnings. All but one of the grocery wholesales
were in the group incurring operating losses, as
were also 2 of the wholesales dealing largely in
petroleum products. All but 4 wholesales showed
smaller earnings; in most cases, the drop was sharp.
Causes given for this were higher operating costs,
price declines, the “ squeeze” in the petroleum
market that caused sharp declines in production
and refinery gains (or even losses), and much more
difficult competitive conditions.
Patronage refunds to member associations by
the regional wholesales totaled $5,903,262; the
corresponding figure in 1948 for these associations
was $17,836,043.
The value of own production by the central
organizations continued to rise, attaining a peak
of nearly $208 million in 1949. This was an in
crease of slightly over 20 percent from 1948, and
occurred in spite of the difficulties encountered
by some of the wholesales operating refineries in
obtaining sufficient supplies of crude oil; those
owning or controlling considerable numbers of
producing wells were in a more favorable position.
The increased effort toward self-sufficiency in
1
It should be pointed out that this figure includes some duplication (where
local associations are members of more than one regional wholesale). Also,
many of these affiliatedretail associations are purely farm-supply associations
handling producer goods only, and hence not covered in this Bureau’s figures.
1
2
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
this respect raised the value of refined petroleum
output from about $70}£ million in 1948 to over
$103}£ million in 1949. Value of output of crude
oil rose from almost $11 million to nearly $13}£
million.
Other commodities that showed sizable in
creases in value of output over the year were
feed, seed and fertilizer, chemicals, and machinery
and equipment. Considerable declines were
shown in food products, lubricating oil, lumber
and shingles, printing, and vegetable oils.
Values of services provided by reporting service
federations rose from over $2.1 million in 1948
to $2.2 million in 1949. A large increase occurred
in the insurance and bonds business, but this and
smaller increases in a number of services were in
sufficient to overcome declines in others.
The figures in table 1 include not only conti
nental United States but also Alaska and Puerto
T able
1.— Estimated membership and business of consumers'
cooperatives in 1949, by type of association
Type of association
Total
number
of asso
ciations
Number
of
members
Amount of
business
Local associations
Retail distributive...................... ........
Stores and buying clubs...............
Petroleum associations.................
Other1...........................................
Service......................... ............. .........
Rooms and/or meals__________
Housing....... ..................................
Medical and/or hospital care:
On contract.... ........................
Own facilities___ _________
Burial:4
Complete funeral..................
Caskets only____ ____ ___
Burial on contract.......... ........
Cold storage fi___..........................
Other«...........................................
Electric light and power 7_..................
Telephone (mutual and cooperative)..
Credit unions 9_..................................
Insurance associations.........................
3,790
2,350
1,375
65
785
185
155
25
80
16,000
895,000
750,000
10,350,000
26,000
395,000
27
3
1,120
7,000
5,000
70,000
10
100,000
6,500,000
180
25,000
120
2,000,000
178,171,086
898 82,895,062
33,000
675,000
10,000,000
778,844,521
10,085 4,066,977
2,000 1011,500,000 “ 210,000,000
Federations 12
Wholesales:
Interregional..................................
Regional........................................
District..........................................
Service.................................................
Productive...........................................
Electric light and power7...................
2,511,000 $1,215,000,000
1,500,000
820,000,000
990,000
380,000,000
21,000
15,000,000
32,072,000
306,620
16,000
6,300,000
22,500
*5,700,000
Assns.
2
30
19
19
17
11
77
5,135
265
1,750
425
87
11,133,300
» 345,897,000
1*6,043,000
2,185,000
106,500,000
9,605,221
I Such as consumers’ creameries, dairies, bakeries, fuel yards, lumber
yards, etc.
* Gross income.
* Not including about 4,500 partly paid members.
4
Local associations only; excludes federations (which are included with
federations) and funeral departments of store associations.
* Excludes cold-storage departments of other types of associations.
6Such as water-supply, cleaning and dyeing, recreation, printing and
publishing, nursery-school associations, etc.
7Data furnished by Rural Electrification Administration.
8Number of patrons.
* Actual figures, not estimates; includes, for the first time, data on credit
unions in Puerto Rico.
10 Number of policyholders.
II Premium income.
12 Figures do not in all cases agree with those in tables 7-11, for those
given here include an allowance for nonreporting associations.
u Includes wholesale distributive, retail distributive, and service business.
Rico. Data were not available for Hawaii. The
information for Alaska was obtained directly from
the cooperatives there, whereas that for Puerto
Rico was furnished by the Office of the Inspector
of Cooperatives of Puerto Rico. According to his
report, there was as of June 30, 1949, a total of
62 distributive associations (12 more than in the
preceding year); these included 53 grocery coop
eratives, 1 farm-supply cooperative, and 2 gasoline
cooperatives, with a combined membership of
7,400 and an annual business of $3,669,451. The
3 housing associations had a combined member
ship of 437 and had income during the year
amounting to $40,023; the 1 service cooperative
had 25 members and a business of $600. Forty
credit unions, with 6,730 members, had assets of
$379,625 and made loans amounting to $665,686
during the year.
Table 1 shows the number of associations, not
number of establishments operated. Many coop
eratives have one or more branches. Also, the
table does not indicate the volume of business done
in any particular line; many associations carry on
several departments doing different kinds of
business; table 1 classifies them according to their
m a in line of business.
In 1949, as in 1948, dissolutions of store associa
tions exceeded those newly formed, reducing the
total number slightly. Among those that went
out of business were several “ closed” stores
sponsored by labor unions, which admitted to
membership only members of the sponsoring
group. It should be noted, however, that such
closed enterprises are very few, for most of the
union-sponsored cooperatives now have open
membership and make heroic efforts to enlist the
support of the whole community.
Local Associations
Distributive Associations in 1949
Membership of reporting associations averaged
819 for the stores and 719 for the petroleum coop
eratives; average volume of business done was
$413,471 and $277,166, respectively. Net earn
ings for the stores that had earnings averaged 3.9
percent on the total business done; losses for those
that suffered losses averaged 2.3 percent of sales.
(The corresponding figures for 1948 were 4.2 and
2.7 percent.) For the associations whose main
3
PROGRESS INI 1949
business was the handling of petroleum products,
earnings averaged 7.2 percent and losses 2.6 per
cent (6.7 and 2.2 percent, respectively, in 1948).
Information on patronage refunds was available
for 454 local associations; these returned a total
of $5,787,946. The rate of return, based on
amount of business done, was 2.7 percent for the
stores, 5.3 percent for the gasoline cooperatives,
3.1 percent for the “ other distributive,” and 3.7
percent for the service cooperatives.
These patronage refunds included not only the
earnings made by the local associations on their
own operations, but also cash refunds received by
them on their purchases from the wholesale asso
ciations. The latter, however, were in many cases
much smaller than in preceding years. Previously,
the refunds from the wholesales often exceeded
the entire operating earnings of the local associa
tions.
N o n f a r m a s s o c ia tio n s : The performance level
of the city associations with nonfarm member
ship— dealing mainly in food— fell below that of
the whole group of reporting cooperatives in 1949
as it did in 1948. These city associations suffered
from the fact that their wholesales were showing
losses and therefore could return no patronage
refunds. The balance sheets of these local asso
ciations were also adversely affected by write
offs of part of their share capital investment in the
wholesales as a result of the wholesales’ losses—
and consequently of the decline in the value of
the latter’s assets.
Comparison of the nonfarm associations with
the whole group of reporting associations (farm
and nonfarm) indicates that the average member
ship and sales of the nonfarm store associations
was smaller than those of the whole group,
whereas the membership and business of the non
farm petroleum associations was larger (table 2).
Considerably smaller proportions of both types
of nonfarm associations made earnings on their
operations in 1949 and substantially larger pro
portions had losses, as compared with the whole
group. Among those that had earnings, those of
both store and petroleum nonfarm associations
were smaller than was the case for all reporting
associations. Among those with losses, however,
although the nonfarm store associations’ losses
were greater compared to the farm and nonfarm
combined, the losses of the nonfarm petroleum
associations were smaller.
924619— 51------ 2
A smaller percentage of the nonfarm associa
tions than of the whole group improved their net
worth situation, and there were fewer nonfarm
associations whose net worth was 50 percent or
more of their total liabilities.
T able 2 .— Comparison
of nonfarm cooperatives with all
consumers’ cooperatives (farm and nonfarm), 1949
All farm and non
farm
Item
Average membership:
Store associations........................
Petroleum associations...............
Average amount of business:
Store associations.......................
Petroleum associations___ ____
Percent of reporting associations
having earnings:
Store associations......................
Petroleum associations_______
Percent of reporting associations
having losses:
Store associations.......................
Petroleum associations...............
Net earnings of those with earnings:
Store associations........................
Petroleum associations_______
Net losses of those with losses:
Store associations......................
Petroleum associations...............
Net worth:
Larger than in 1948..... ............
Smaller than in 1948....................
No change.................................
819
719
733
788
$413,471
$277,166
$254,430
$288,460
80.1
96.4
64.3
68.4
19.9
3.6
35.7
31.6
Percent of sales
Percent of sales
3.9
7.2
2.7
6.2
2.3
2.6
2.6
2.2
Percent of assns.
Net worth (as percent of total lia
bilities) :
Less than 50 percent...................
50 but under 75 percent..............
75 but under 90 percent-.............
90 but under 100 percent...........
100 percent..... ....... .......... .........
T a b l e 3.— Leading
Nonfarm only
57.8
40.5
1.7
Percent of assns.
51.6
46.3
2.1
13.7
36.0
29.0
19.6
1.7
25.3
32.8
27.6
13.2
1.1
consumers1cooperatives, 1949 1
Association
Mem
ber
ship,
1949
Busi
ness,
1949
Distributive associations
Consumers' Cooperative Society of Palo Alto, Calif___
1,964 $1,371,563
Rochdale Cooperative, Washington, D. C.__................ . 3,650
561,648
Cooperative Trading, Inc., Waukegan, Hl__................... 6,315 2,596,121
Greenbelt Consumers Services, Greenbelt, Md............. . 2,605 2,199,818
Harvard Cooperative Society, Cambridge, Mass.......... . 25,395 3,311,402
United Cooperative Society, Fitchburg, Mass................ 3,000 1,158,821
United Cooperative Society, Maynard, Mass................. 2,634 1,311,436
Cloquet Cooperative Society, Cloquet, Minn................. 4,270 1,797,217
Franklin Cooperative Creamery Association, Minneapo
lis, Minn......................................................................
3,500 5,736,691
Cooperative Consumers Society, Ithaca, N. Y ...............
1,900 1,194,168
Consumer-Farmer Milk Cooperative, Long Island City,
7,298 2,600,215
New Cooperative Co., Dillonvale, Ohio......................... 2,249 1,938,741
University of Oregon Cooperative Association, Eugene,
Oreg............................................................................. 3,185
566,090
Service associations
Group Health Association, Inc., Washington, D. C
Consumers Cooperative Services, New York, N. Y.
7,041
(*)
730,343
1,682,041
1Includes those having 3,000 or more members and/or a business of $1 mil
lion or more.
2No data; membership in 1947 was 8,291.
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
4
able to show earnings for the year. As already
noted, because of the reduced earnings of the
wholesales the local associations affiliated with them
received much smaller patronage refunds than in
previous years and in many cases no refunds at all.
Operating expenses of all types of associations
have risen by about 50 percent since before the war.
Comparison of the expenditures of the farm and
nonfarm associations indicates that the latter are
higher, mainly because of higher sales expense
(wages, advertising, wrappings, etc.).
T r e n d o j d e v e lo p m e n t , 1 9 4 2 - 4 9 : The 10-year
trend in operations of cooperative store and pe
troleum associations is shown in table 5.
Among the nonfarm consumers7 cooperatives
reporting to the Bureau for 1949 were 10 associa
tions having 3,000 or more members each and 12
whose 1949 business exceeded a million dollars
(table 3).
O p e r a tin g e x p e n se s , 1 9 4 9 : Table 4 presents data
on the operating expenses of 118 consumers7
cooperatives in 1949. These associations had
combined sales of $28,659,420. Their individual
sales ranged from $34,253 to $1,938,741. Of the
total group, 37 had operating losses but in 8 cases
the income from other sources (including patron
age refunds from their wholesales) was sufficient
to overcome the loss, so that the association was
T a b l e 4. — Operating
expenses of farm and nonfarm consumers’ cooperatives, 1949, by type of association
[Figures in parentheses indicate the number of associations covered]
Percent (in terms of total sales) spent for specified item
Store associations
Item of expense
Nonfarm
(52)
Farm
(29)
Petroleum associations
Total
(81)
Nonfarm
(3)
Farm
(27)
Lumber
yards,
farm
(5)
Total
(30)
Milk-dis
tributing
associa
tions,
nonfarm
(2)
Gross margin----- -------------- --------- ---------------------Operating expenses:
Wages, salaries, and commissions....... .......................
Group insurance, retirement, etc................................
Advertising________________________________
Wrappings and miscellaneous sales expense...............
17.2
13.7
16.3
22.2
17.8
19.1
22.6
32.9
10.1
(9
.5
.6
6.8
9.2
8.6
.1
.3
.1
10.1
.1
.4
.2
6.5
20.1
.4
.5
13.5
.1
.6
.2
.2
.1
.6
Total sales expense...................._.............................
11.2
7.2
10.1
14.4
9.1
10.8
6.7
20.8
Miscellaneous delivery expense, except wages--------Rent------------------------------------------------- *------Light, heat, power, water, ice____________ :------Insurance and bonds____________________ _____
Taxes and licenses:
Social security, withholding, etc------ -----State and county real estate and other taxes and
licenses_______________________________
Interest on borrowed money. ----- -------------------Office supplies and postage------------------------------Telephone and telegraph______________________
Repairs to plant and equipment----------- -------- —
Depreciation of plant and equipment____________
Bad debts________ _________________________
Inventory, audit, and professional.......... ................. .
Warehouse and plant expenses— .............................
Directors’ fees and expenses. .....................................
Travel__________________________ _____ ____
Education, public relations, publications..................
Membership dues, meetings, donations. ....................
Laundry and cleaning expenses..... ...........................
Miscellaneous..............................................................
.3
.5
.6
.3
.5
.1
.5
.4
.4
.4
.5
.3
2.0
1.2
.8
.3
1.4
.1
.4
.5
1.5
.4
.5
.4
.2
.2
.2
.3
1.6
.6
1.3
.3
.2
.1
.2
.3
.2
.2
.1
.6
.4
.1
.1
.1
.3
.7
.5
.1
.1
.1
.3
.8
.1
.1
.4
.1
.1
.1
.3
.8
.5
.5
.1
.2
.2
.2
1.0
.5
.1
.2
.1
.2
.9
.1
.1
.2
.1
.1
.2
.7
.1
.2
.1
.2
.1
.3
.2
1.8
1.2
.6
.2
1.9
(9
0)
(9
(9
(9
(9
.2
.2
.1
,1
.1
.4
(9
(9
(9
(9
.1
(9
'
(9
(9
(9
(9
(9
.1
(9
(9
.2
(9
(9
.5
.1
.3
.1
.1
.4
.3
.1
.2
.8
.2
(9
.2
.1
.1
.1
(9
.6
.3
(9
(9
(9
(9
.5
.1
.2
.1
.4
(9
.1
(9
.4
.2
'
.1
.6
Total operating expenses.........................................
15.9
11.4
14.7
22.8
14.6
17.0
10.3
32.5
Operating earnings--------- -------- ------- -------------Total earnings (including other income)....................
1.3
2.1
2.3
3.6
1.6
2.5
2.6
.9
3.2
5.6
2.1
4.2
12.3
13.3
.4
.4
Less than 0.05 percent.
5
PROGRESS INI 1949
T a b l e 5. — Trend
of operations of specified types of local consumers’ cooperatives, 194&—49
Store associations
Item
Membership:
Percent of increase over preceding year..................................
Percent reportingincrease over preceding year............................................
Decrease from preceding year________________ ____
Amount of business:
Percent of increase over preceding year.._____ __________
Percent reportingincrease over preceding year................ .................. .........
Decrease from preceding year______________________
Net earnings:
Percent going from—
Gain to loss___ ______ _________________________
__ ____________
Loss to gain___
Percent reporting—
Loss in current and preceding years________________
Increase in gain over preceding year________________
Decrease in gain over preceding year_________ ______
Petroleum associations
1949 1948 1947 1946 1945 1944 1942 1949 1948 1947 1946 1945 1944 1942
5.2
8.4
13.4
8.3
5.4
72.8 82.9
27.2 17.1
11.6
98.8 75.5
1.2 24.5
72.9
27.1
30.8
19.6 30.8
70.0
30.0
77.5 80.9
22.5 19.1
»1.3
11.3
41.4
58.6
73.0 80.8 90.5
27.0 19.2 9.5
39.9
8.8
7.4
9.0
3.3
19.4
3.7
5.8
9.1
10.9
32.6
40.3
11.8
37.0
38.9
9.1
30.8
37.0
3.3
62.5
19.2
15.9
11.5
25.6
72.9 80.3 90.8
27.1 19.7 9.2
4.2
10.7
14.4
9.5
76.9 80.2 77.5 78.2 79.9
23.1 19.8 22.5 21.8 20.1
73.8
26.2
6.5
9.6
1.2 23.2 26.3
52.4 93.2
47.6 6.8
6.4
4.2
5.4
4.9
2.8
2.1
8.4 2.0
49.4 62.3
27.2 25.1
2.2
69.5
17.9
1.5
51.9
41.7
2.9
1.8
10.8
27.9
89.7 94.1
10.3 5.9
2.4
1.0
.9
.3
.5
54.8 55.3 88.0
40.2 40.8 11.1
11.4
22.6
13.6
86.3 89.4
13.7 10.6
78.9
21.1
.8
.7
.9
2.0
1.2
78.9
20.3
.5
74.5
23.3
.4
64.7
31.7
10.7
1Decrease.
Medical-Care Associations0
Some new medical- or hospital-care associations
were being organized in 1949, especially in
Wisconsin, where a law authorizing such plans
was enacted in 1947. The progress in that State
has been slower than expected, however. In
Texas, some of the early cooperatives organized
under the 1945 law found conditions unfavorable
and either dissolved or merged with other groups
to serve a wider area. A number of others, which
had gone ahead, had turned over the hospital for
private operation by one or more physicians, or
had given up the cooperative features.2
Certain cooperatives have charged the medical
profession with obstruction and monopoly. These
charges were being investigated by the United
States Department of Justice, and in several
States cases were being tried in court.3 In
Oregon, the Antitrust Division of the United
States Department of Justice brought suit in the
Federal court against the Oregon State Medical
Society, Oregon Physicians’ Service, eight county
medical societies, and several physicians. The
charge was that of trying to monopolize prepaid
medical service through the Oregon Physicians’
Service. The case came to trial in mid-October
1949. Witnesses testified to the use by the
medical profession of boycotts, disciplinary pro
• For report on special study of medical-care cooperatives, see appendix
(p. 31).
* U. S. Department of Agriculture. Statement * * * for inclusion in
Department’s testimony before House Committee on Interstate and Foreign
Commerce, on H. R. 4312 and H. R. 4313, June 8,1949 (p. 9); also, News for
Farmer Cooperatives (Washington, Farm Credit Administration), October
1949 (p. 5),
1 Washington (D. C.) Post, October 21, October 27, and November 12,
1949; Cascade Cooperative News (Seattle, Wash.), December 1949.
ceedings, and refusal to admit to membership
doctors who desired to associate themselves with
prepaid medical-care plans not approved by the
defendants. Hospitals, they said, notified the
plans that hereafter they would admit only the
patients of associations owned and operated by
doctors. The court recessed at this point and
did not resume until 1950.4
In Seattle, Wash., Group Health Association of
Puget Sound brought suit against the King
County Medical Society, several local hospitals,
and the King County Medical Bureau. The
association requested not only damages for harm
done to the association but also an injunction against
the defendants to restrain them from further acts of
“ conspiracy.” The charges made were practically
the same as in the Oregon case above.6 The
suit came up for trial in the spring of 1950. After
5 weeks of testimony the County Court dis
missed the cooperative’s suit, holding that the
so-called monopoly had been created innocently
without malice and that the efforts of the medical
profession were simply to protect their continua
tion of ownership. The case has been appealed
by the association to the State Supreme Court.
The American Medical Association in June
1949 adopted a set of 20 standards required of
cooperative plans as a basis for recognition by the
medical profession. These were transmitted as
recommendations to State and county societies.
4 Testimony was completed early in the spring, but a decision still had not
been rendered by late fall, 1950.
8 Cascade News (Seattle, Wash.), December 1949; Group Health News
and Information (Seattle, Wash.), January 1950. An FBI investigation in
Oklahoma, reported by United Press, was summarized in Cooperative
Consumer (Kansas City, Mo.), November 16,1949.
6
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
Late in 1949, the AM A added other conditions:
That no plan could be recognized until it had
been in operation for 1 year, and that approval
of both the local and State medical societies be
obtained. Cooperative leaders met later with
a special committee to discuss these new con
ditions, which the cooperators felt were dis
criminatory. A satisfactory compromise was
worked out, but several court suits have been
started, by cooperatives or in their behalf, over
alleged violations of the agreement by three
local medical societies.
By the end of the year, 31 (of 38) clinics were
in operation and 32 (of 52) hospitals on the co
operative plan were in operation; 3 other groups
had buildings under construction.
Two important events of the year were the third
annual meeting of the Cooperative Health Fed
eration of America, in September, and the calling
of an institute by the University of Illinois in
February for union-sponsored medical-care plans
obtained under collective-bargaining agreements.
Some of these union plans are full or fraternal
members of the Cooperative Health Federation.
The aim of the Cooperative Health Federation
is to coordinate voluntary efforts for medical care
and to promote a more effective approach “ by
combining a method of prepayment with a method
of group practice and by combining preventive
services with curative services.” Among the
Federation’s essential activities are the provision
of legal advice to local groups on medical-care
matters, assistance in recruiting physicians and
nurses, and acting as representative of the volun
tary health plans in congressional hearings, in
negotiations with the American Medical Associa
tion, and in public-relations work.
New groups, it was emphasized at the annual
convention, should try to draw upon all classes
in the community for membership and should
keep the members fully informed. They need
physical facilities, as well as doctors, nurses, and
hospital administrators. Technical assistance in
obtaining all these is essential. A scale of ade
quate rates is also necessary. There is now, in
nearly every State, a source from which guidance
may be obtained.6
The meeting reaffirmed the previous position
“Information on this point is available from the Cooperative Health
Federation of America, 343 S. Dearborn Street, Chicago 4, 111.
on national health insurance— that such a system
must make adequate care available to all the
people and must make provision for voluntary
plans. All member plans were urged to seek the
approval of local and State medical societies under
the AM A “ recommended” 20-point standard for
voluntary plans. Needs to be met as soon as
possible by the Federation were the issuance of a
manual for organizing and for professional per
sonnel, an in-service training program, publication
of a monthly journal, and the collective purchase
of pharmaceutical supplies.
Housing Associations
Mortality among the housing associations
formed since the end of the war has been heavy.
Many never progressed beyond the paper stage.
Some purchased land but were unable to raise
enough capital for construction. Others obtained
financing only at the cost of their cooperative
principles. The discouragements incident to the
long lag between planning and realization, interim
costs that drained group resources, and, most
important, difficulty in obtaining long-term financ
ing, were the main reasons for the demise of these
groups, most of which dissolved before getting to
the ground-breaking stage.7
An intensive study that was made jointly by the
Housing and Home Finance Agency and the
Bureau of Labor Statistics revealed additional
dissolutions (either because of inability to solve
their problems or because of completion of a co
venture project), but also some new or previ
ously undiscovered associations. The survey dis
closed a total of 155 active associations, 8 co-ven
ture associations that had gone out of existence be
cause their project was completed, and 33 others
that had dissolved at various points before fin
ishing the project. The 128 active associations
from which data were obtained had a combined
membership of 20,549 persons. The reporting
cooperatives had a total of 21,926 dwellings com
pleted or in construction. Of these, 7,158 had
been purchased already built by “ mutuals,” from
7 Some of the difficulties faced by housing associations were set forth at
length in hearings, in the first session of the 81st Congress, before congressional
committees dealing with the so-called “middle-income housing bill.” That
bill (supported by veterans’, labor, church, and cooperative groups) would
have provided for direct Government loans for cooperative and nonprofit
organizations at the current Federal rate of interest plus H percent, admin
istration to be under a new housing agency established for the purpose. The
bill was withdrawn before the end of the session.
PROGRESS' IN 1949
Government agencies. There were 78,856 rooms
in these dwellings (51,806 were in the mutual
projects). The enactment of Section 213 in the
Housing Act of 1950, with its directive to the
Federal Housing Administration to assist housing
cooperatives with planning and technical advice,
has stimulated additional activity.
Cold-Storage Associations
“ Rougher going than at any time during the
war” was reported by the Farm Credit Administra
tion in regard to cold-storage locker plants both
privately and cooperatively owned. Their rate of
increase slowed down, and they had to raise their
charges. Although gross revenues increased, net
savings were lower because of the small volume of
meat processed and higher costs of labor, supplies,
and equipment. As demand has caught up with
supply, “ the days of long waiting lists have gone”
and some of the newer and larger plants even have
trouble renting their lockers. The problem now is
to build sufficient volume of business— especially
in slaughtering— to attain capacity operations.8
Student Cooperatives
Scattered reports on campus cooperatives in
dicate that in most places they are holding their
own, especially those operating rooming and board
ing houses. These associations are federated into
several regional leagues, all of which held annual
meetings during 1949. One of these, the Central
League of Campus Co-ops, in 1947 started a re
volving fund to aid local students’ cooperatives to
obtain suitable quarters. Its first loan from that
fund was made in 1949, to assist a Kansas student
group to buy a cooperative house for women
students.
Since the end of World War II many store asso
ciations have been formed to serve the married vet
erans (and their families) who have been complet
ing their education. As with other cooperatives
formed to meet special transitory circumstances,9
the majority of these will probably go out of
existence as the veterans leave school. This will,*•
*News for Farmer Cooperatives (Washington), January 1950.
• Others in this category have been the cooperatives in War Relocation
camps for Japanese-Americans, and cooperatives in camps for conscientious
objectors.
7
of course, be true if (as a result of school rules,
pressure from local businessmen, etc.) the mem
bership of the cooperative has been restricted to
veterans. Where that is not the case, the co
operative may persist as an organization serving
other students, faculty, and even townspeople.
Thus, in Orangeburg, N. Y., provision for the
continuing existence of the veterans’ cooperative
was made when, in 1949, the bylaws were amended
to accept into membership persons living outside
the veterans’ village.
The students’ cooperative at Vanport College,
Portland, Oreg., which was flooded out by the
rising waters of the Columbia and Willamette
Rivers in the spring of 1948, is reported not only
to have recovered but to have made great progress.
This association operates a cafeteria and book
store.
Central Organizations
The year 1949 was a fairly uneventful period
for the federations, with comparatively little
expansion in either distributive or productive
facilities.
Cooperative refineries and regional wholesales
owning their own refineries were caught in a price
“ squeeze” in 1949. Prices of crude oil remained
at the 1948 peak, whereas the selling prices of the
refined products decreased. The result was, in
many cases, to wipe out earnings. Only those
refineries in which 28-30 percent or more of the
crude oil comes from wells owned or controlled by
them— and in which the oil-production earnings
compensated for the refinery losses— were able to
come out even.10 The retail petroleum associa
tions, on the other hand, were enabled by the
reduced wholesale prices to make increased
earnings.
Summary data on membership, business, earn
ings, patronage refunds, and own production, are
given in table 6. The 74 reporting federations
had a total of 6,688 affiliated local associations.
These should not be assumed to be 6,688 different
This situation was, of course, not confined to refineries owned by coop
eratives. Small independent refiners also were hard hit, especially if they
owned no crude production and had to buy their supplies. A number were
forced to close down. It was reported, early in January 1950 (Cooperative
Consumer, Kansas City, Mo., January 2, 1950), that these enterprises had
organized the Independent Refiners Association of America, with the an
nounced purpose of preventing additional closings and “bringing about
conditions which will enable the independent refiners to survive.”
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
8
associations, however, as the figure contains a
good deal of duplication caused by the fact that
local associations may be members of more than
one central organization.
T able 6.— Summary of operations of cooperative wholesales and service and productive federations, 1949
Item
Number of organizations reporting..................
Number of member associations.....................
Total business...................................................
Wholesale distributive............... ...............
Retail distributive
______________
Service____________________________
Value of own production ______________
Net earnings, all departments-------------------Patronage refunds, all departments.................
All central
organizations
74
6,688
$470,401,739
338,072,271
19,041,786
6,895,668
207,849,285
10,043,723
9,286,427
Wholesales
Inter-regional
Regional
2
77
$11,133,336
11,084,830
48,506
1,653,800
128,033
28
5,055
$345,896,603
322,295,992
19,041, 786
4, 558,825
110,235,525
8,591, 540
5,903, 262
District
Service
federations
13
205
$4,982,419
4,691,449
17
1,056
$1,997,367
290,970
978, 725
193,036
117, 778
1,997,367
59,724
32,307
Productive
federations
14
295
$106,392,014
94,981,235
1,227,456
3,233,080
1 Loss.
Wholesale Associations
M e m b e r s h ip : The membership of both the inter
regional associations (National Cooperatives and
Cuna Supply Cooperative) remained unchanged.
Both increases and decreases occurred, however,
in the number of affiliates of the regional and
district wholesales. Of the 25 regionals that
reported to the Bureau of Labor Statistics for
1949, 21 estimated that their 4,742 member asso
ciations had 1,668,000 individual members in 1949;
12 of these regional wholesales (with 4,067 affil
iated associations having an estimated member
ship of 1,406,000) were members of National
Cooperatives.
Altogether 5,055 retail associations were mem
bers of regional wholesales, representing (for those
reporting for both 1948 and 1949) an increase of
about 2 percent. This was the smallest increase
in some years*
D is tr ib u tiv e f a c i l i t i e s :
National Cooperatives
merged the Waukesha (Wis.) branch of its milk
ing-machine factory with the Albert Lea (Minn.)
plant.
Radios were discontinued, reportedly
because of unsatisfactory market conditions.
Though the operations ended “ in the red,” the
loss was only one-tenth as large as that incurred
in 1948.
In California, a mail-order business, to build
volume and at the same time develop cooperative
activity throughout the State, was started late in
1949 by Associated Cooperatives.
Central States Cooperatives (Illinois) moved its
headquarters and grocery warehouse to Waukegan*
merging its warehouse activities with those of
Cooperative Trading, Inc. (its largest affiliate),
there. The move was expected to reduce overhead
costs. The wholesale during 1949 also began
operation of its first retail branch, a store handling
household appliances, automobile accessories,
paints, and hardware. It had already taken over
on a temporary basis a food store formerly
operated by an independent association that still
retains operation of a social hall.
In accordance with a decision made by its 1948
annual meeting, Indiana Farm Bureau Coopera
tive Association took over, effective January 1950,
the marketing operations of the Indiana Grain
Cooperative. The wholesale was already in the
marketing business, having carried on the selling
of eggs since shortly after the end of World War II.
A second expansion of its catalytic cracking plant
was announced in mid-year, with a new unit to
increase the present capacity to 10,000 barrels of
crude oil a day. It was stated that 2 years
would be required to build the new unit.
In Michigan, a new association, Farmers Pe
troleum Cooperative, took over from Farm Bureau
Services the distribution of petroleum products,
using the transport trucks purchased from that
association; the shift was made January 1, 1949.
At the annual meeting of Midland Cooperative
Wholesale (Minnesota) in March 1949, it was
reported that the special grocery committee,
created in accordance with the decision of the
1948 meeting, recommended discontinuance of the
grocery department. This was concurred in by
the general manager, who commented that a 10-
PROGRESS IN? 1949
year trial in this field had failed, and that a survey
had revealed “ too little volume, too wide an area
to be served efficiently, improper operating facili
ties, and outmoded methods.” After extended
discussion the delegates voted for a special meeting
of delegates from associations operating food
stores, to consider the problem more at length.
The decision at that meeting was that Midland
should continue handling “ co-op label” groceries
but give up nationally advertised private-brand
goods.
For the first time in many years Midland an
nounced no plans for expansion. The program
for 1949 was stated to be that of consolidation
and improvement of its present position and of
doing intensive information work among its mem
ber associations. The wholesale reported, at the
end of the year, that, with one exception (1948), the
year 1949 was the best “ in Midland’s 23-year
life.”
By the end of the year, Consumers Cooperative
Association (Missouri) expected to have com
pleted 3 new propane gas bulk plants, bringing to
38 the total number of these plants, serving about
26,000 farm families. This gas is used for cooking,
heating, refrigeration, and as fuel for farm tractors.
In March 1949, Eastern Cooperatives, Inc.,
opened a branch warehouse in Baltimore, Md., to
serve the associations in the Potomac area, since
one of the wholesale’s difficulties lay in the high
cost of transportation of goods from the central
warehouse over its 11-State area. A branch
warehouse had been in operation for a number of
years in New England. A program of decentrali
zation of the warehousing activities of ECI was
voted at its annual meeting in May 1949, with
transfer of functions (and eventually of ownership
and control) to area organizations. The central
organization would continue to arrange for pur
chase of “ co-op label” goods, carry on the coffee
roasting and any other processing desired, the
testing and grading of commodities, real-estate
holding and operation, compiling and analyzing
of comparative statistical information, and educa
tion and information services. The meeting
convened again in the fall, at which time it was
decided that decentralization efforts should be
continued and that a plan for the financial reor
ganization of the wholesale be drawn up by a
special committee representing each of the three
9
main areas served, to be submitted to the member
associations not later than January 15, 1950.
Operations reports showed that although drastic
cuts had been made in expenses, at least partial
causes of loss were sharp declines in volume (partly
as a result of dissolution of local associations that
had bought their supplies from the wholesale)
and the continuing drain entailed by the New
York warehouse which, with decentralization and
smaller sales, had become a source of dispropor
tionate expense. The warehouse was sold in
September and the headquarters office, the ware
housing operations for the New York and
Philadelphia areas, and the coffee-roasting plant
were transferred to a new location in Palisades
Park, N. J.
D is tr ib u tiv e a n d service o p e r a tio n s : Declines in
business in 1949 as compared with 1948 were
suffered by a number of wholesales (table 7).
some of which had previously had a long record
of increase from year to year.
Wholesale prices declined an average of 6.1
percent during 1949, and this accounted in most
cases for the declines in dollar volume of business
reported by some of the regional wholesales.
Notwithstanding the market conditions, a number
of the cooperative wholesales increased their
dollar volume, signifying a substantial rise in
tonnage handled.
Among the associations reporting a lower
volume was Associated Cooperatives (California)
where the decrease was attributed to a decrease in
nonmember patrons (chiefly purchasing the highermargin, nonfood items) and a shifting of patronage
by farmer cooperatives to a new farmer coopera
tive wholesale which opened in San Francisco.11
Operating losses on distributive operations were
further increased by losses in the lumber depart
ment caused by major declines in the market
price of lumber. Drastic reductions in personnel
(including most of the field workers) had been
made early in the year and in July the wholesale’s
subsidized periodical was suspended. Publication
on a reduced scale was later resumed, on a strictly
self-supporting basis. Other reductions in over
head expenses were also made.
11 Noting that it had become clear during 1949 that the wholesale Could not
become “a real factor in the farm-supply wholesaling business in California,"
the wholesale’s board of directors voted early in 1950 to find out what possi
bilities there were for selling outright its entire farm-supply and buildingmaterials business.
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
10
T a b l e 7.— Distributive
and service business, earnings, and patronage refunds of cooperative wholesales, 1948 and 1949 1
[Associations marked (*) are members of National Cooperatives, Inc.*]
Association
All associations:
Interregional:
Wholesale business...............................
Service business............ . ......................
Regional:
Wholesale business................................
Retail business.....................................
Service business....................................
District:
Wholesale business...............................
Service business....................................
A ff ilia te d
a s s o c ia tio n s
A m o u n t o f b u s in e s s
1949
1949
1948
77
/
\
$ 1 1 ,0 8 4 ,8 3 0
4 8 ,5 0 6
1
Y 5 ,0 5 5
4 ,8 6 7
(
t
l
3 2 2 ,2 9 5 ,9 9 2
1 9 ,0 4 1 ,7 8 6
4 ,5 5 8 ,8 2 5
3 1 7 ,9 1 1 ,2 6 7
7 ,7 9 4 ,0 6 3
4 ,4 5 9 ,0 8 3
205
171
/
\
4 ,6 9 1 ,4 4 9
2 9 0 ,9 7 0
5 ,0 6 7 ,6 6 5
3 1 3 ,7 7 3
1 24
24
[
\
l
1 0 ,8 1 9 ,4 6 9
1 0 ,7 4 0 ,9 6 3
4 8 ,5 0 6
2 6 5 ,3 6 1
1 2 .0 2 8 .5 7 6
1 2 .0 2 8 .5 7 6
1 ,2 4 6 ,5 7 0
1 ,1 2 1 ,4 9 7
1 2 5 ,0 7 3
1 ,4 7 3 ,2 3 8
1 ,3 3 5 ,4 0 0
1 3 7 ,8 3 8
1 ,5 4 6 ,1 4 6
1 ,1 4 8 ,2 4 3
1 ,1 2 6 ,3 4 9
1 ,0 6 1 ,9 0 6
3 5 ,3 6 4
2 9 ,0 7 9
3 6 ,0 3 9 ,4 5 7
1 ,5 9 4 ,4 8 9
1 ,5 3 8 ,4 6 8
5 6 ,0 2 1
3 7 ,0 5 8 ,8 2 7
« 3 5 ,0 6 4 ,6 8 4
9 7 4 ,7 7 3
6 ,1 6 7 ,5 9 4
ii 3 6 ,2 3 0 ,5 5 0
8 2 8 ,2 7 7
6 ,0 5 2 ,9 5 5
1 7 ,7 8 2 ,5 1 5
1 1 ,2 0 8 ,3 0 9
6 ,4 8 6 ,3 5 2
8 7 ,8 5 4
“ 1 ,8 7 6 ,5 8 8
84 1 ,7 9 6 ,5 5 2
“ 8 0 ,0 3 6
1 8 ,5 4 4 ,4 2 4
1 2 ,6 0 0 ,5 4 8
5 ,7 8 5 ,7 9 7
1 5 8 ,0 7 9
}
1949
1948
77
}
}
P a tro n a g e refu n d s
N e t e a r n in g s
1948
1949
1948
* $ 2 8 ,0 3 3
8 $ 3 7 8 ,8 4 7
1
Y
8 ,5 9 1 ,5 4 0
2 2 ,5 2 1 ,7 2 1
$ 5 ,9 0 3 ,2 6 2
$ 1 7 ,8 3 6 ,0 4 3
}
1 9 3 ,0 3 6
2 5 6 ,5 3 8
1 1 7 ,7 7 8
2 1 6 ,5 7 0
1 1 8 ,7 5 8
(8)
$ 1 2 ,2 6 5 ,6 3 5
Interregional
Illinois—National Cooperatives4 (Chicago)__
Distributive business, wholesale................
Service business..........................................
Wisconsin: Cuna Supply Cooperative * (Madison)..
53
53
51
46
12
Idaho—Idaho Grange Wholesale 7 (Shoshone)...........
Illinois—Central States Cooperatives, Inc.® (Wauke
gan i°)*......................................................................
Distributive business, wholesale..... ......... ..........
107
Distributive business, retail.................................
Service business-------------------- -----------------Indiana—Indiana Farm Bureau Cooperative Asso
ciation (Indianapolis).*
86
Distributive business, wholesale..........................
Service business............ .......................................
40
Iowa—Iowa Farm Service Co.18 (Des Moines)..........
Michigan—
Farm Bureau Services 18 (Lansing)*....................
Distributive business, wholesale.................... • 150
Distributive business, retail...........................
Service business............... ................... ..........
Farmers Petroleum Cooperative « (Lansing)___
Distributive business, wholesale___ _____ • 40
Service business..............................................
MinnesotaMidland Cooperative Wholesale (Minneapolis)*. 1
Distributive business, wholesale_________ Y 594
Service business______ ___________ ____ I
84
Minnesota Farm Bureau Service Co.15 (St. Paul).
425
Farmers Union Central Exchange (St. Paul)*__
Mississippi—Delta Purchasing Federation 4(Green
5
wood)_____________ ____ __________ ______
Missouri—
Farm Bureau Service Co. of Missouri18 (Jeffer
22
son City)-------------------------------- -----------Consumers Cooperative Association 18 (Kansas
City)*...____ _______ _________________ 1
Distributive business, wholesale................. Y 1 ,4 5 5
Service business_____________ _________ 1
126
Producers Grocery Co. (Springfield)........ ..........
Nebraska—Farmers Union State Exchange18
(Omaha)*----- ------------------------------------------Distributive business, wholesale.......................... ' 37 5
Distributive business, retail............ ...................
Service business..................................................
New Jersey—Eastern Cooperatives, Inc. (Palisades
Park 18)*....................................................... ........ .
Distributive business, wholesale.......................... ‘ 175
Service business__________________________
North Carolina—Farmers Cooperative Exchange4
(Raleigh)*---------- ------------------ ------------------43
Distributive business, wholesale..........................
Distributive business, retail.................... .......... .
Service business............ .......................................
Ohio—
Cooperative Wholesale Association (Columbus)*.
79
Farm Bureau Cooperative Association (Colum
bus)______ ____ ____ ____________ ____ _ • 90
Distributive business, wholesale.................
Service business............... .................. ..........
Ohio Farmers Grain & Supply Association
(Fostoria)..........................................................
240
Distributive business, wholesale.................. .
Distributive business, retail..........................
See footnotes at end of table.
13
* 4 2 ,8 8 8
8 4 0 1 ,2 5 9
1 4 ,8 5 5
2 2 ,4 4 2
8 6 3 ,2 4 1
8 3 0 ,6 0 6
1 2 0 ,4 2 5
8 2 ,6 5 4
8 3 6 ,4 8 5
8 2 9 ,9 7 1
'I* 2 ,5 5 3 ,6 9 5
1 * 2 ,9 1 6 ,9 5 1
|
2 3 7 ,0 5 9
Regional
California—Associated Cooperatives6 (Oakland) *___ 1
Distributive business, wholesale...................... [
Service business....... .............................................
f
\
l
250
86
40
159
-
f
\
1
78
425
2 9 ,8 1 6 ,6 7 8
2 9 ,5 4 9 ,9 7 2
2 6 6 ,7 0 6
4 ,3 2 5 ,6 1 6
3 6 ,4 1 0 ,1 4 3
5
8 8 6 ,2 7 4
8 3 7 ,5 4 2
22
1 4 6 ,9 0 7
( 8)
1 * 2 4 8 ,4 5 7
1
Y..................................
)
2 7 ,3 6 4 ,2 3 7
2 7 ,1 1 4 ,6 1 3
2 4 9 .6 2 4
4 ,7 8 4 ,4 5 4
3 4 ,9 8 9 ,6 0 9
600
1
*
1* 2 7 7 ,7 2 7
1 ,1 7 7 ,7 4 6
2 ,9 1 6 ,9 5 1
(8)
1 3 5 ,9 2 2
1 4 7 ,2 6 9
2 0 6 ,6 1 6
14 2 3 ,2 1 2
1
Y
8 1 9 7 ,1 6 4
2 ,2 7 6 ,9 2 8
( 8)
2 ,8 5 8 ,2 5 0
2 7 9 ,2 1 8
4 ,7 4 7 ,5 9 5
( 8)
( 8)
1 ,7 1 2 ,9 3 3
( 8)
1 ,8 6 3 ,2 0 4
( 8)
2 5 0 ,2 7 6
2 ,9 9 8 ,5 9 7
( 8)
1 1 ,5 5 6
1 2 ,9 6 3
8 ,3 2 0 ,2 0 6
2 4 ,3 3 4
6 ,1 7 2 ,6 0 6
2 0 ,9 3 4
3 1 ,2 5 0
17 3 4 1 ,8 1 5
6 3 8 ,9 1 9
3 0 7 ,6 4 2
5 4 0 ,0 0 0
8 9 1 ,3 9 2
8 8 4 ,9 3 9
3 2 8 ,6 1 4
( 8)
2 ,1 0 8 ,1 8 1
1 ,1 6 4 ,2 5 9
5 6 ,2 1 0 ,6 2 8
5 5 ,3 9 7 ,9 9 5
8 1 2 ,6 3 3
1 ,6 6 2 ,7 8 0
5 5 ,4 4 1 ,0 1 8
5 4 ,1 7 4 ,4 0 4
1 ,2 6 6 ,6 1 4
1 ,6 6 2 ,7 0 7
]
[
17 5 ,4 6 9 ,4 4 9
i7 4 , 0 2 8 ,0 3 7
»7 1 ,3 6 6 ,1 6 1
77 7 5 ,2 5 1
8 ,1 0 7 ,3 9 1
6 ,2 1 2 ,2 7 0
1 ,8 1 0 ,1 2 1
8 5 ,0 0 0
)
350
f
1
1
l
172
f
\
l
3 ,7 6 7 ,7 7 8
3 ,7 3 4 ,9 1 4
3 2 ,8 6 4
6 ,1 8 0 ,5 4 3
6 ,1 5 1 ,5 1 2
2 9 ,0 3 1
(4)
f
1
1
l
1 5 ,8 6 3 ,0 9 7
5 ,4 1 5 ,6 6 0
1 0 ,3 5 8 ,8 3 8
8 8 ,5 9 9
6 0 7 ,9 1 0
7 1 9 ,3 2 9
181
1 4 ,5 4 5
89
f
<
l
5 3 .9 3 2 ,9 7 7
5 3 ,4 1 7 ,9 5 5
5 1 5 ,0 2 2
5 5 ,4 3 5 ,1 2 0
5 4 ,9 2 8 ,2 0 0
5 0 6 ,9 2 0
1
Y
9 6 2 ,5 0 4
1 ,4 4 2 ,9 0 8
6 4 7 ,0 3 7
1 ,1 8 3 ,9 6 2
225
f
1
X
2 ,6 7 0 ,7 6 0
2 , 4 4 8 ,6 8 4
2 2 2 ,0 7 6
2 ,6 1 4 ,0 5 3
2 ,4 1 4 ,9 0 8
1 9 9 ,1 4 5
I
Y
7 4 ,0 1 2
9 3 ,6 8 8
3 1 ,2 7 6
7 1 ,0 2 9
1 ,4 1 1
f
\
l
116
77
l
1 7 ,0 8 8
2 7 ,3 4 7
8 6 ,3 3 4
4 5 ,8 8 6
Y
|
3 8 6 ,0 5 5
( 8)
( 8)
( 8)
J
4 ,6 0 4
PROGRESS m
T a b l e 7.— Distributive
11
1949
and service business, earnings, and patronage refunds of cooperative wholesales, 1948 and 1949 1—
Continued
[Associations marked (*) are members of National Cooperatives, Inc.2]
Affiliated
associations
Amount of business
1949
1949
Patrohage refunds
Net earnings
Association
Oregon—Oregon Grange Wholesale______________
Distributive business, wholesale..........................
Distributive business, retail_________ _____
Service business___ 1_______________ ___ __
Pennsylvania—Pennsylvania Farm Bureau Coop
erative Association (Harrisburg) *..........................
Distributive business, wholesale_____________
Service business __1. __ ________________
Texas—Consumers Cooperatives Associated8 (Ama
rillo) * ............................. .....................................
Distributive business, wholesale_____________
Service business....... 1....................... -............ ___
Utah—Utah Cooperative Association18 (Salt Lake
City) *......................................................................
Washington—
Grange Cooperative Wholesale8 (Seattle)...........
Distributive business, wholesale....... ............
Service business__ __I___ ______________
Pacific Supply Cooperative * (Walla Walla) *___
Distributive business, wholesale____ _____
Service business....... 1______ ___________
Wisconsin—
Wisconsin Cooperative Farm Supply Co.7
(Madison)................................ ............. ...........
Central Cooperative Wholesale (Superior) *.........
Distributive business, wholesale............... . ..
Service business______________________
1948
f
•
10
(8)
30
30
■ 389
269
16
15
1
>
56
57
|
127
124
62
59
1
[•
206
189
24
9
1
[
f
<
l
f
<
[
{
<
1
1948
$1,573.787
993,883
572,995
6,959
18,270,331
18,004,180
266,151
10,677,832
10,677,832
522
(8)
$18,086,759
17,843,220 [
243,539 1
1949
2 $4,726
1948
1949
(8)
1948
(8)
634,525
$280,950
$180,020
$88,908
10.320.243
10.320.243 i 2*349,320
J
615,691
56,421
473,940
22 53,048
59,812
42,614
21,953
350,707
374,983
350,707
374,983
584,814
435,696
584,814
424,803
271,218,343
1,357,504
7,503,825
7,174,232
329,593
18,055,983
17,440,962
615,021
6,915,317
6,592,808 |
322,509
i®9,188,781
i®8,928,954 t
i®259,827
3,564,609
8,928,019
8,658,247
269,772
5,999,502
9,710,732 ]
9,412,010 y
298,722
27,128
51,540
33,815
36,653
319,702
211,182
28 103,835
94,473
16,645
10,703
56,268
56,268
(8)
229,746
184,012
45,734
134,712
126,571
8,141
403,807
349,958
53,849
2,648
4,060
23,462
3,373
204,094
129,197
74,897
171,259 ]
98,256 >
73,003
14,619
11,704
12,297
9,936
22,975
27,132
14,433
23,630
32,890
40,366
26,951
29,459
D istr ic t
Iowa—Propane Gas Cooperative12 (Eagle Grove).__
Michigan—
Bruce Cooperative Services4*(Bruce Crossing)..
Distributive business._____ ___ _______
Service business..........................................
Northern Cooperatives2 (Hancock)._________
Distributive business.......................... ..........
Service business..............................................
MinnesotaFederated Co-ops of East Central Minnesota *
(Cambridge)_______ ___________________ 1
Distributive business.................................... [
Service business...................................... ......
C-A-P Cooperative Oil Association21 (Kettle
River)........... ....................................................
Distributive business......................... ...........
Service business______________________
Range Cooperative Federation (Virginia)_____
Distributive business................... .................
Service business______________ ___
Nebraska—Consumers Cooperative Propane Co.8
(Sutton)........ .......................... ............. .................
South Dakota—
Propane Service Cooperative 12 (Alpena)______
Farmers Propane Gas Cooperative Association «
(Arlington)____________________________
Farm Gas Co-op Association 12 (Lennox)______
Wisconsin—
Fox River Valley Cooperative Wholesale22
(Appleton)____________ _______________
A & B Cooperative Association 22 (Ashland).......
Cooperative Services 7 (Maple)____________ 1
Distributive business............. ............ ........... f
Service business______________ ________ J
f
8
8
<
8
8
<
32
23
\
19
19
\
24
24
\
10
4
l
j
l
f
l
2,287
(»)
3,373
232,347
192,404
39,943
1,737,924
1, 595,252
141,672
10
85,320
140, 502
1,029
12,134
(8)
10,862
4
2884,085
99, 592
7,162
14,044
(8)
9,696
7
7
<’> 7
46,380
46, 918
51, 459
68,439
6,702
3,549
(8)
7,583
(8)
2,969
51
4
48
4
1.384, 424
279, 756
376,193
374,535
1,658
1, 630,125
289,884
336,056 )
330, 750 j5,306
28,607
17,348
86,598
13,098
24,976
25,743
28,607
(8)
25,677
l
f
l
f
7 {
l
2Data are for calendar year, unless otherwise indicated.
2 Tennessee Farmers Cooperative (which does not handle consumer goods)
is also a member oi National Cooperatives. National also had 7 affiliates
in Canada.
2 Loss.
• Data are for fiscal years ending June 30.
• Data are for fiscal years ending Feb. 28, 1949, and 1960.
• Data are for fiscal years ending Oct. 31.
7Data are for fiscal years ending Sept. 30.
1No data.
2Data are for fiscal years ending Mar. 31,1949, and 1950.
70 Formerly at Chicago.
71 Including marketing business.
924610— 51------ 8
9,698
239,299
217,664
21,635
1,546,101
1,399,055
147,046
7
f
6,844
(8)
12 Including earnings from production.
12 Data are for fiscal years ending Aug. 31.
148 months' operation.
15Data are for fiscal years ending Nov. 30.
18 Data are for fiscal years ending Dec. 31, 1948, and Sept. 30,1949.
779 months’ operation.
18 Formerly at New York City.
796 months’ operation.
20 Including service business.
27 Data are for fiscal years ending Apr. 30, 1949, and 1950.
22Data are for fiscal years ending July 31.
22 Data are for fiscal years ending May 31.
6,370
85,516
4,755
25,743
12
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
Largely as a result of the price situation in the
petroleum industry, Consumers Cooperative Asso
ciation, which made savings exceeding 8% million
dollars (its all-time record) in 1947-48, had
earnings of only about 50 thousand dollars in
1948-49. Its new finance service for local co
operatives, which went into operation early in
1948, concluded its first full year on August 31,
1949, with net earnings of $546 for the year.
Pacific Supply Cooperative (Washington) suf
fered a decline in dollar volume in 1949, as com
pared with 1948, of more than a million dollars.
This was attributed to decreases in the prices of
seed and feed grains. Warehouse volume (except
in Pocatello, Idaho) also fell. The petroleum and
chemical products departments, however, both
had an increase in sales. At the annual meeting, it
was stated that the merchandising program would
hereafter be centered primarily on basic farm
supplies and that it was necessary to make
substantial progress in those lines before entering
the highly competitive field of consumer goods.
Price declines, especially in feeds, and the
generally downward trend in business were cited
as the chief reasons for the 8-percent decrease in
sales of Central Cooperative Wholesale (Wiscon
sin). The annual meeting of the wholesale, in
April, abolished the payment of interest on
common stock, increased the authorization for
preferred stock, and made several other bylaw
changes.
Among the district wholesales, new systems of
voting and elections by districts were adopted in
1949 by Trico Cooperative Oil Association (Clo
quet, Minn.) and Range Cooperative Federation
(Virginia, Minn.). The latter reported a decline in
dollar volume, for the first 5 months of the year,
in spite of larger tonnages handled. This was
attributed wholly to price declines. Operating
gains were considerably larger than in the cor
responding 1948 period.
The annual report of Range Cooperative
Services (Hurley, Wis.) showed an operating loss,
which was more than overcome by nonoperating
income. T o correct what was reported as a
“ dangerously overexpanded program,” the associ
ation’s annual meeting voted to sell an unneces
sarily large warehouse and to discontinue the
automobile sales and service department.
C a p ita l a n d re so u rc e s: Of the 26 regional whole
sales furnishing information on their capital
structure, 2 were nonstock associations. Among
the other 24, both common and preferred stock
were used by 21 organizations, to a total of
$27,042,559 in common and $38,381,297 in pre
ferred. The three associations with no stock of the
latter kind had $879,983 in common stock. Of 12
reporting district wholesales, 1 was a nonstock
organization. Eleven had common stock totaling
$445,206. Only three had preferred stock— to the
amount of $282,200.
Assets for 28 regionals and 12 district associa
tions reporting totaled $169,877,996 and $1,909,451, respectively. Among the regionals the ratio
of current assets to total assets ranged from 38.2
to 98.4 percent (in 1948 the range was from 36.9
to 97.4 percent), with an average of 47.9 percent
(56.5 percent in 1948). In 7 of the 25 associations
reporting on this point, 70 percent or more of the
assets were current in 1; on the other hand, in
4 wholesales, less than 45 percent were current.
Among the reporting district wholesales, cur
rent assets ranged from 24.8 to 52.0 percent of total
assets (34.4 to 91.4 percent in 1948) and averaged
51.1 percent (52.6 percent in 1948).
The ratio of current assets to current liabilities
ranged, among the regionals, from 0.9:1.0 to
30.3:1.0. In 6 associations current assets were
three or more times as large as the current liabili
ties. Among the district associations the range
was from 0.9:1.0 to 16.0:1.0, and the average was
3.1:1.0. These figures showed a slight improve
ment over 1948, for both regionals and district
organizations.
Member equities (i. e., ratio of net worth to total
liabilities) also showed some gain. They ranged
among the regionals from 30.7 to 92.5 percent and
averaged 69.0 percent; in 1948 the range was from
13.3 to 93.8 percent, and the average 58.4 percent.
In 15 of the organizations the member ownership
in 1949 was 60 percent or more; only 10 were in
this class in 1948.
13
PROGRESS' IN! 1949
Services of Central Cooperatives
Expansion of service facilities: At a meeting
under the auspices of the Cooperative Finance
Association of America, in October 1949, repre
sentatives of 11 regional wholesales recommended
that the association gather information looking
toward the establishment of an investment trust
for cooperatives. The activity, if undertaken,
would be carried on by the finance association.
Cooperative Finance Corporation, an organiza
tion to provide financing for local cooperatives in
California, reported that by the end of 1949 eight
local associations had become members. It had
made loans totaling $1,100.
A management service, for better and closer
relationships with member cooperatives, was
started by Consumers Cooperative Association.
An association subscribing for this service will
agree to use CCA’s auditing and business analysis,
consult on business procedures and policies and, “ to
such extent as is practical and possible,” make all
of its purchases of supplies from the wholesale.
One of the most important features in the new
plan is the finding and training of persons for man
agement and department-head jobs in local cooper
atives. The candidate will undergo an approximate
6-month course, receiving also practical experience
in the whole range of retail jobs. By midyear 15
individuals had been trained and placed in man
agerial jobs, and a half dozen more were in training.
Service business: The amount of service business
done in 1949 by central organizations fell some
what from 1948 (table 8). Most of the decline was
in the transport, finance, and cold-storage groups.
Table 9 shows the amount of each type of service
business done by the wholesales and service federa
tions in 1948 and 1949.
Resources of service federations: Fifteen service
federations reported assets totaling $1,453,463,
or an average of $96,898. Member equities
ranged, in the individual associations, from
13.0 to 100.0 percent of total assets. The average
was 63.7 percent.
T able 8 .— Value of services performed by cooperative wholesales and federations, 1943 -4 9
1949
Amount
All services
Repairs (autos, machinery, appliances, etc.)
Funeral service____________________________
Recreation______________ ____ _____________
Insurance, bonds, etc----------------------------------Auditing, accounting, tax service___________
Finance and credit_________________________
Store services (store lay-out, management, plan
ning, advertising, merchandising, etc.)_______
Business analysis and advice__________________
Transport (truck, pipeline, tank car, e t c . ) _____
Millwright service_____________________________
Printing (purchase on ly )______________________
House insulation______________________________
Cold storage__________________________________
O ther_________________________________________
Depart
ments or
Service
subsidiaries federations
Percent of wholesales
Total
T ype of service
1947
1946
1945
1943
$6,895,668
100.0
$4,898,301
$1,997, 367 $6,948,241
225,135
115, 717
3.3
1.7
225,135
77,081
8, 548
675,610
143,894
129, 486
193, 373
102,614
10, 548
210, 725
311,104
1,701,216
236,300
120,385
7,398
167,488
292,745
1,100, 414
173,076
8,144
3, 781,022
4,821
68,177
25, 523
282, 747
75,151
429,973
217,669
60,585
15,496
2,984, 713
4,995
65,241
89,149
19,853
54, 216
3,977, 795
3,139
25,172
22, 762
3,103,882
3,029
16,412
’§,"964,"808
11,001
675, 610
330,810
1,681,069
303,859
24,980
3, 208, 753
5,882
115,204
22,856
55, 748
119,044
.2
10.0
4.9
24.9
4. 5
288, 270
.4 ________
46.0
3,098, 241
.1
5,882
1.0 48,506
.3
22,856
.8
55, 748
1. 8 119,044
Production by Central Cooperatives
Productive facilities of wholesales: Comparatively
little expansion of productive plants took place
in 1949.
Early in 1949, Consumers Cooperative Associa
tion took over the operations of the Bridgeport
Oil Co., in Wichita, Kans., when that company
dissolved. This transaction involved 100 produc
ing wells and 65,000 acres of leased oil-bearing
1948
38, 636
2,453
186,916
1, 551, 583
15, 589
24,980
110, 512
66, 698
$5, 572,870 $5,485,092
154,870
168,358
350,667
242,832
321,828
$3,983, 352
$4, 550,708
153,183
97,337
4,846
246,083
167, 583
130, 412
77,981
104,073
4,864
49,912
154,357
178,884
333
land. The cooperative was the owner of over
90 percent of the corporation’s stock, the
remainder being held by about 300 individuals.
The transfer did not increase CCA’s oil supply, as
it was already receiving all the output of the
company. By the end of May 1949, CCA owned
1,080 producing wells, supplying 59 percent of
the crude oil necessary to operate its four refineries.
Acquisition of leases on 15,000 acres of land in
14
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
northeastern Wyoming in the same month added
support to the program for self-sufficiency in
petroleum. Its new fertilizer plant at Muskogee,
Okla., was dedicated in mid-1949. The association
also announced plans for expansion of its lumber
mill at Swisshome, Oreg., to produce kiln-dried
lumber.
Farm Bureau Cooperative Association (Ohio)
reported, early in the year, that 3 producing wells
had been brought in, in Franklin County, 111.
P r o d u c tiv e f a c i l i t i e s o f f e d e r a tio n s : The high
cost of crude oil and the low prices of refined
products caused a shut-down of the refinery of
Petrol Refining, Inc., at Texas City, Tex., late
in 1949. A controlling interest in this refinery
was bought by a group of regional cooperatives
in the fall of 1948. It was reported that the plant
T a b l e 9. —Service
would be “ maintained in a standby condition”
until the market situation improves.12
The National Farm Machinery Cooperative
(Ohio) modernized its foundry in 1949.
The Cooperative Publishing Association (Wis
consin) reported that its operations were back “ in
the black” for the first 6 months of 1949. It
had had a loss in 1948, for the first time in its
history.
Extensive fertilizer deposits in southern Idaho
were bought and leased, respectively, b y Central
Farmers Fertilizer Co. and Western Fertilizer
Co. These two federations are owned by groups
of farmers, cooperatives and regional wholesales.
Two new machines were installed by Grange
Cooperative Printing Association (Washington).1
3
13 Farm Bureau Mirror (Harrisburg, Pa.), November 1949.
activities of central cooperatives, 1948 and 1949 1
SERVICE DEPARTMENTS OF WHOLESALES
Amount of service business
(gross income)
State, association, and kind of service
State, association, and kind of service
1949
Total:
Interregional..........
Regional wholesales.
District wholesales.
California—Associated Cooperatives..................
Accounting..................................................
Insurance (agency)....................... ...............
Illinois:
Central States Cooperatives.........................
Auditing and accounting...................... .
Management service................................
National Cooperatives—Printing (purchase
Indiana—Indiana Farm Bureau Cooperative
Association.................................. ....................
Auditing.................. . . . ................................
Insurance (agency)............ ...........................
Finance and loans............. ...........................
Automobile and appliance repair................
Management................................................
Trucking.......................................................
Michigan—
Farm Bureau Services..................................
Management.......... ................................
Millwright..............................................
Automobile repair..................................
Trucking................................................
Farmers Petroleum Cooperative: Trucking.
Northern Cooperatives: Cold storage..........
MinnesotaMidland Cooperative Wholesale..................
Appliance and bulk-station repair.........
Trucking.................................................
Pipeline and tank-car service.................
Federated Co-ops of East Central Minne
sota...........................................................
Insulation...............................................
Insurance (agency).......... *.....................
Transport....................... ........................
C-A-P Cooperative Oil Association..............
Automobile repair..................................
Trucking.................................................
Range Cooperative Federation....................
Automobile repair.................................
Mortuary.................... ..........................
Cold-storage locker service.....................
Recreation and educational....................
See footnotes at end of table.
1948
$48,506 .......... ...........
4,558,825
$4,459,083
290,970
313,773
125,073
4,267
120,806
137,838
9,834
128,004
29.079
29.079
56,021
27,671
28,350
48,506
974,773
23,321
77,458
3109,548
38, 531
1,977
723,938
828,277
27,805
67, 417
3 124,984
27,158
87,854
11,950
5,882
6,468
63,554
80,036
45,734
158,079
7,770
4,821
580,913
145,488
53,849
249,624
24,104
35,395
190,125
266, 706
29,495
41, 221
195,990
74,897
22,856
13,172
38,869
21,635
73,003
25,523
13,679
33,801
39,943
18,395
21,548
141,672
56, 706
65,511
11, 500
7,955
21,635
147,046
51,852
77,081
10,014
8,099
Amount of service business
(gross income)
1949
Missouri—Consumers Cooperative Association..
Auditing.......................................................
Management........................................ ........
News.............................................................
Trucking.......................................................
Insurance (agency).......................................
Finance and credit.......................................
Pipeline service ............ ...............................
Nebraska—Farmers Union State Exchange:
Trucking___________ _________________
New Jersey—Eastern Cooperatives, Inc______
Merchandising..............................................
Insurance (agency).......................... ............
Supervisory service.......................................
Refrigeration repair service____________ _
North Carolina—Farmers Cooperative Ex
change, Inc.......................................................
Auditing.......................................................
Trucking............. .................. ......................
Insurance (agency)........................................
Finance....... .................................................
Machinery repair..........................................
Other............................................................
Ohio—Farm Bureau Cooperative Association...
Trucking.......................................................
Store plans and specifications.................... .
Oregon—Oregon Grange Wholesale: Finance__
Pennsylvania—Pennsylvania Farm Bureau
Cooperative Association: Trucking.................
Texas—Consumers Cooperatives Associated:
Repair of appliances, machinery, etc..............
WashingtonOrange Cooperative Wholesale....................
Auditing.................................................
Trucking.................................................
Pacific Supply Cooperative..........................
Truck repair...........................................
Trucking.................................................
WisconsinCooperative Services.....................................
Machinery repair....................................
Recreation........................................ .
Central Cooperative Wholesale....................
Trucking...............................................
Appliance repair.....................................
Advertising................................. ..........
Store lay-out...........................................
Other.......................................................
1948
$812,633
81,657
2,784
95,681
148,290
448, 278
3,638
32,305
$1,266,614
77,693
6,957
69, 725
1,112, 239
(3)
75,251
32,864
6,617
85,000
29,031
13,267
12,980
88,599
4,423
11,232
15,896
9,341
25,494
22, 213
515,022
316,476
198,545
6,959
266,151
(3)
1,625
9,217
18,189
(»)
506.920
506.920
09.........
243.539
522
329,593
1,147
328,446
615,021
53,201
561.820
322,509
1,230
321,279
259,827
21,125
238,702
1,658
1,209
449
269, 772
204.718
10, 774
16,807
36,323
1,150
5,306
4,756
550
298,722
184,547
9,408
27,994
74,827
1,946
15
PROGRESS IN! 1949
T a b l e 9. —Service
activities of central cooperatives, 1948 and 1949 1— Continued
SERVICE FEDERATIONS
Member associa
tions
State, association, and kind of service
1949
Total.......................... ......... ...................... ............. .......... ...........
California—Cooperative Finance Corporation 4 (Oakland): Fi
nance and credit-------------------------------------------------------Illinois—Cooperative Federation of Chicago 6 (Chicago): Man
agement service-------- -----------------------------------------------Iowa—Business Service Association7 (Des Moines)_____ ___ _
Auditing___________ _____________________________
Tax service----------------------- -----------------------------------Maryland—Federated Cooperatives of Maryland (Frederick)__
Business analysis and advice, and collections___ ___ ____
Finance and credit______________________________
Management---- ----------------------------- ---------------------Minnesota—
Northland Cooperative Mortuary • (Cloquet): Funeral serv-
1948
1,056
1949
$2,169,724
1 ,0 1 1
1
}
)
[
|
1
11
206
184
4
4
20
20
i
Unless otherwise indicated, data shown for service federations are for
calendar year; for fiscal years of wholesales, see table 7.
* Loans made.
»No data.
4 Data are for years ending Oct. 31.
8 Loss.
The International Lumbering Association
(Canada) owned jointly by 11 regional whole
sales, ceased operation early in 1949 and went
into dissolution. The reasons given for this
drastic action were the downward swing of demand
and prices in the cedar-shingle market, beginning
in 1948, while costs of production remained high.
The continued operating losses resulting from this
situation led to the decision to liquidate the
association.
G oods 'produ ced: Cooperative production in
creased by over 20 percent in 1949, as compared
with 1948, and in the 7-year span shown in table
10, by over 600 percent. In 1949, substantial
increases in value of product occurred in chemicals,
feed, seed and fertilizer, machinery, crude oil,
1948
$2,104,169
52
449
f
<
l
f
1
1
l
13,069
25,770
23,820
1,950
26,696
16,162
8,014
2,520
1,613
22,961
20,319
2,642
28,961
3,480
9,133
16,348
24, 299
20,925
2,453
119,891
86,389
19,124
8,818
5, 560
Net earnings
Patronage refunds
1949
1948
1949
1948
$59,724
$27,693
$32,307
$18,596
51 4 4
i 1,500
8
12
Mesaba Range Cooperative Park Association 8 (Hibbing):
Recreation____________________ ______ _______ ___
52
Cooperative Auditing Service 9 (Minneapolis)_______ ___ 1
Auditing------------------ -------------------------------------Bookkeeping and accounting________________ _____ }
447
Business analysis and advice---------------------------------Tax service___________________ ______ __________ 1
Cooperative Press, Inc.4 (Minneapolis): Collective purchase
of office supplies and printing_____ _________ _______
11
Midland Credit Corp. (Minneapolis): Finance and credit...
33
Farmers Union Cooperative Credit Association (St. Paul):
Loans to cooperatives__________ ___ __________ _____
210
Montana—Farmers Union Carriers 7 (Froid): Transport______
(3)
Nebraska—
Farmers Union Non-Stock Transport Association7 (Dodge):
Trucking---------------------- ------------------------------------2
Farmers Union Nonstock Cooperative Transport Association
(Kearney): Trucking. --------------------------- --------- ------(3)
Farmers Nonstock Cooperative Transport Association8
(Milford): Trucking----------------------- --------- ---------- 4
South Dakota—Equity Audit Co.4 (Aberdeen): Auditing and tax
40
service------------------------------ ------------------------------------Wisconsin—
5
Valley Cooperative Services 10 (Appleton): Funeral Service..
2
Central Finance, Inc. (Superior): Finance and credit...........
Amount of business (total
revenue)
2,043
103, 777 1
73,900
16,100 \
8,144
5,633 1
148
8187
309
103
3,506
5,162
3,506
5,162
2,031
1,267
1,318
429
«625
8
366
4,854
4,398
4,369
3,958
33
66,698
2 1,136,620
68,177
21,179,911
3,706
7,818
3,566
5,009
3,293
1,475
3,163
1,429
194
(3)
2313,344
31,060
2 312,576
(3)
14,211
3,201
2,107
(3)
14,211
3,201
2,107
1,429
11
2
11,112
9,402
23
1,968
50,727
41,944
13,464
4
17,613
17,113
2,603
(3)
1,222
40
50,073
48,277
3,209
2,411
5
2
14,337
2 92,105
16,178
2 74, 612
162
1,108
849
1, 253
(3)
(3)
(*)
(3)
(3)
934
919
8
8 Data are for years ending Mar. 31, 1949, and 1950.
7 Data are for years ending Sept. 30.
8 Data are for years ending Aug. 31.
9 Data are for years ending Nov. 30.
10 Data are for years ending July 31.
and refined petroleum products. Lubricating oil,
however, showed a decrease, as did also food
products, lumber and shingles, printing, coal, and
vegetable oils.
The value of the various kinds of goods pro
duced in 1949 and 1948 by the individual whole
sales and productive federations is shown in
table 11. For the productive federations, the
net earnings and patronage refunds made are
also shown.
R e so u rc e s o f p r o d u c tiv e f e d e r a tio n s : Combined
assets of the 14 productive federations that sup
plied information on this point totaled $49,663,624,
or $3,547,402 per association. Net worth (mem
ber ownership) range from 17.8 to 97.1 percent and
averaged 36.8 percent.
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
16
T a b l e 10. — Value of manufactures of cooperative wholesales and federations, 1943-49
1949
Commodity groups
Total
Amount
All products_____ ______ $207,849, 285
Food products__________
Crude oil.____ _________
Refined petroleum prod
ucts_________________
Lubricating oil...................
Grease________________
Paint_________ ___ ___
Lumber and shingles____
Printing and printing prod
ucts_________ ____ __
Coal___________ _____
C h e m i c a l s (cosmet
ics, household supplies,
insecticides, serum)____
Poultry and poultry prod
ucts________________
Feed, seed, fertilizer_____
Vegetable oils and meal__
Machinery and equipment.
Other________________
Per
cent
Depart
ments or Productive
subsidiaries
federa
tions
of whole
sales
100.0
$112,868,050 $94,981,235 $172,823,405 $128,420,867
2, 970,814
13,487, 738
1.4
6.5
103, 587, 626
4, 640, 775
395, 320
232, 657
1,189,881
49.8
207,221
261,347
.1
.1
207, 221
739, 435
.4
739,435
527,925
67,094, 441
2,872,112
9,496, 541
145,452
.3
32.3
1.4
4.6
2, 741,398
9,016,257
2.2
.2
.1
.5
.1
1948
229,416
4,471,481
3, 816,287
10,953,136
62,352, 549 41,235,077
4,640, 775
395, 320
232, 657
1,189,881
70, 281, 530
8, 754, 656
361,357
228,209
2,375,381
1947
1945
1946
1944
;, 583,814 $60,577,789
1943
;, 999,183
$29,431,499
2,120, 517
1,438,027
2,073,462
721,050
1,958,036
31,340
47,481,861 36,392,061 25,852, 711
6, 284, 424 4,891,432 4,369,325
191, 210
323, 716
183,023
119,074
272,345
71, 380
309,059
1,973, 207
2,165,002
4, 659,465
226,374
81,689
1,361,866
6, 743,901
1,358,479
223,864
1,351, 782
360, 502
192, 793
29,274
326,959
0)
2, 725,804
4,323,115
4, 285, 504
2, 693,007
261,347
419,341
315, 356
443, 692
109, 570
. 321,491
249,239
59, 610
506,116
452, 591
930, 742
182, 714
136,034
527,925
28, 752,091 38,342,350
2,872,112
2,059,441 7,437,100
132,352
13,100
434, 725
62, 732, 634
3,890, 618
7, 539, 029
215,030
298, 749
321,306
486,486
57, 557, 781 42, 673, 541 22, 503,054
369, 296
16,102,495
246,247
16, 781,157
1,868,809
11, 574
49,232
5, 692, 856
293,419
2,353, 630
124,314
2,473,036
60, 249
1 No data.
T a b l e 11.—Productive activities of central cooperatives, 1948 and 1949 1
PRODUCTIVE DEPARTMENTS OF WHOLESALES
Value of goods produced
Value of goods produced
State, association, and goods produced
State, association, and goods produced
1949
Total:
Interregional wholesales.
Regional wholesales___
District wholesales____
California—Associated Cooperatives: Lumber..
Illinois—National Cooperatives____________
Flour______________________________
Chemicals and their products___________
Hot-water heaters____________________
Milking machines and coolers____ _____
Indiana—Indiana Farm Bureau Cooperative
Association___________________________
Crude oil— 1------------------------------------Refined petroleum products____________
Printing-----------------------------------------Meat products_______________________
Chicks--- ----- --------- ---------------------- Fertilizer___ _____ __________________
Serum and virus_____________________
Michigan—Farm Bureau Services__________
Fertilizer______________________ _____
Insecticides_________________________
Minnesota—
Minnesota Farm Bureau Service Co_____
Feed-------------------------- -------- ------Fertilizer________________________
Midland Cooperative Wholesale.________
Crude oil________________________
Refined petroleum products_____ ___
Lubricating oil___________________
Feed-----------------------------------------Insecticides____________________
Farmers Union Central Exchange_______
Refined petroleum products_________
Lubricating oil___________________
Tractors______________ _____ ____
Range Cooperative Federation_________
Meat products__________ _____ ___
Butter__________________________
Cheese_________________________
Milk and cream (processed)_________
See footnotes at end of table.
1948
$1,653,800
110, 235,525
978, 725
$3,389,446
97,166,660
1,065, 475
89,135
1, 653, 800
280, 259
235, 272
1,138, 269
92, 842
3,389, 446
1,355, 911
37,014
431,340
1, 565,181
15,350,133
1, 587, 923
9, 910,687
46,123
119,930
192,993
3, 275, 836
216, 641
1,874,834
1, 844, 695
30,139
14, 576, 717
2,129,960
9,550, 969
41,296
95, 766
175,990
2, 449, 001
133, 735
817, 811
792, 705
25,106
3, 443,698
989, 292
2, 454, 406
7,157, 085
897, 856
5, 706, 210
535, 491
2,977,303
853, 845
2,123, 458
6, 282, 896
847, 559
4, 753, 026
671, 352
5,204
5, 755
12,123, 312
11,040,434
1,082, 878
17, 528
12,326,051
10, 823,617
816, 534
685,900
978, 725
49,175
190,391
204, 726
534, 433
1,065,475
77,805
414,937
341,952
230, 781
1949
Missouri—Consumers Cooperative Association.
Canned goods-----------------------------------Soft drinks. ________________________
Crude oil___________________________
Refined petroleum products____________
Lubricating oil.......................... .......... . __
Grease_____________ ____ ___________
Lumber. __________________________
Paint______________________________
Printing____________________________
Feed_______________________________
Fertilizer__ ___ ___________ ________
$38,391,087
247, 857
13,100
6,094,150
23, 901, 473
3, 288,750
395,320
1,100, 746
232,657
102, 319
2, 359, 828
654,887
1948
$33, 250,899
225, 545
13,180
4, 881, 405
16,322, 262
7,000,426
361,357
1, 345,139
228, 209
113,109
2, 553,625
206, 642
Nebraska—Farmers Union State Exchange___
Feed and seed_______________________
Poultry and eggs-------------------------------- }
574, 286
574,286 /l
135,000
100,000
35,000
New Jersey—Eastern Cooperatives, Inc......... .
Coffee (roasted)______________________
Duplicating and offset printing__________
352,416
337,137
15,279
338,985
324,718
14, 267
12,424,074
7, 776,400
183,094
4,464, 580
10,430,601
6,052,376
119, 537
4,258, 688
659,825
436,732
223,093
540,834
375,994
164,840
Pennsylvania—Pennsylvania Farm Bureau Co
operative Association___________________
Feed and seed_________ ______ ______
Insecticides_________________________
Chicks_____________________________
3,826,426
3, 632,333
42,255
151,838
4,053,903
3,899,810
49,895
104,198
Texas—Consumers Cooperatives Associated__
Crude oil. ___________________ I____
Refined petroleum products____________
Feed________ ______________________
Fertilizer and insecticides............................
6,820,458
436,328
4,016,428
524,735
1,842,967
6,418,890
620,697
5,080, 534
280, 803
436,856
Ohio—
Farm Bureau Cooperative Association...... .
Refined petroleum products..... .........
Chicks__________________________
Fertilizer________________________
Ohio Farmers Grain and Supply Associa
tion___________ __________________
Feed____ :________________ _____
Fertilizer.___ ___________________
17
PROGRESS IN? 1949
T a b l e 11.— Productive activities of central cooperatives, 1948 and 1949 1— Continued
PR O D U C TIV E D E PA R TM EN T S OF W HO L E SA L E S— C o n t i n u e d
Value of goods produced
Value of goods produced
State, association, and goods produced
State, association, and goods produced
1949
1948
Utah—Utah Cooperative Association: Refined
petroleum products____________________
$217, 734
$424, 788
Washington—Pacific Supply Cooperative __
Feed.... .......................... ...........................
Fertilizer_________________ ________
Insecticides_____ ___________ ______
4, 967, 642
3, 628, 552
906, 218
432, 872
2, 617,194
2,024, 921
337, 662
254, 611
1949
Wisconsin—
Cuna Supply Cooperative: Printing_____
Central Cooperative Wholesale_________
Bakery products ___________ _____
Coffee (roasted)_____________
_
Bananas (ripened) ________________
Feed_____ ______________________
$43,500
1, 717,141
340,960
366,129
70,401
939, 651
1948
(2)
$2,084, 685
322, 295
322,088
91,309
1,348,993
PROD U CTIV E FE D E R A T IO N S
State, association, and
product
Value of own production
Members
1949
1949 1948
T otal_____________________
Illinois—Central Farmers
Fertilizer C o .123 (Chicago):
Fertilizer________________
I n d ia n a — C o o p e ra tiv e
Plant Foods 4 (Scherer
ville): Fertilizer_________
Iowa—North Iowa Cooper
ative Processing Associa
tion 5 (M anley)_________
Feed__________________
Soybean oil___________
Kansas—National Cooper
ative Refinery Associa
tion 4 (M cPherson)______
Crude o i l . . . ...................
Refined fuels__________ I
Maryland—Fertilizer M an
ufacturing Cooperative 4
(Baltimore): F ertilizer...
Michigan—N orthland Co
operative
Federation
(Rock) e_________________
Cheese________________
Other_________________ !
Minnesota—Northwest C o
operative M ills 4 (St.
P aul)____________ ______
Flour, feed, seed_______
Soybean meal and oil__
Fertilizer______________ 1
O h io National Farm M achin
ery
Cooperative 4
(Bellevue):
Farm
equipment__________
Cooperative M ills 4
(Cincinnati): Feed
Farm Bureau Chemical
Cooperative (Glen
dale): Fertilizer_____
Oklahoma—Producers Co
operative Oil M ill 4 (Okla
homa C ity )_____________
Feed, cottonseed cake, )
and hulls____________ l
Cottonseed oil_________
Cotton linters_________
Texas—Premier Petroleum
Co. (Longview )_________
Crude oil______________
Refined
petroleum 1
products____________ 1
Washington—Grange Co
operative Printing Asso
ciation 9 (Seattle): Print
ing—
Wisconsin — Cooperative
Publishing Association
(Superior)_______________
Printing..................... .
\
Publications__________
Office forms___________ 1
1949
1948
$3,233,080
$6,348,942
6, 368, 736
6, 431, 578
6, 491, 618
59,042
57,663
14,892
42,663
1, 581,011
1, 374, 368
1, 563, 448
1, 289, 731
24,993
9,324
24,993
9,324
1, 622, 315
944,164
678,151
2, 241, 818
1,186, 597 |
1, 055, 221
1, 633, 315
2, 241, 818
194,960
295,152
165,716
265,561
f 22,209,732
4,004, 813
l 18,204,919
19, 530, 656
2, 473, 515 |
17,057,141
20, 498, 254
2,006,095
5,368,547
1,870,167
4,803,675
1, 721,651
27,848
60,800
29,048
60,800
15
6, 431, 578
4
4
(
38
{
5
\
l
1, 333, 042
3
f
\
l
7320, 444
191,553 |
37,863
5, 725, 731
3,058, 459
1, 234, 754
1,432, 518
4
*
1,269,439
19,678,85
1, 749,059
320,444
m
5,173,940
2,168,063 ■ 5, 725, 732
1, 268,021
436,158
(2)
5, 173, 940
(2)
50,838
(2)
(J)
26,684
50,838
(*)
26,684
12
12
7,437,100
5, 542, 508
19, 486,285
14, 590, 676
215, 556
652,114
215,556
551,571
4
4
21, 787,168
20, 252,956
22, 799,376
20, 825,305
820, 705
433, 914
820,705
433,914
2
2
982, 898
826, 452
982,898
826, 452
30,319
20,974
26,778
17,724
f
1, 883,071
2,216,373
59
59
\
791,512
959,207
132,352
2,028,022
2,216,373
4,566
150,487
4,104
130,528
^0 6,498
[
f 23,496,826
1
466,668
3
23, 731,651
82,218,773
1 23,030,158
7 io 13
126
1
888, 505 l
1,112,838
215, 030
127
89,300
172,047
77, 230
72, 899
21, 918
io 81,479
180, 781
86,863 |
71, 946
21,972
1Unless otherwise indicated, data for productive federations are for calendar
year; for fiscal years of wholesales, see table 7.
2 No data.
3 Data are for years ending Mar. 31, 1949, and 1950.
4 Data are for years ending June 30.
3 Data are for years ending Aug. 31.
1948
$7,079,177
15
(2)
1949
$1, 227,456
$94, 981, 235
1
1948
Patronage refunds
$76,138, 078
286
3
1949
1948
Net earnings
$65,059, 506 $106,392,014
295
*
Total amount of business
89,300
io 81,479
3,532
106,498
3,532
172,047
180, 781
7,772
82,980
6,751
8 Formerly classified with wholesales.
7 Including $91,028 distributive business.
8 Loss.
9 Data are for years ending Oct. 31.
i° Data are for 1947.
18
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
T a b l e 12.— Employment and earnings in central cooperative organizations
Type of organization
Number Total
reporting, employ
ees, 1949
1949
Total
payroll,
1949
All reporting organizations..........................
62
9,525
$29,665,930
Wholesales:
Interregional..........................................
Regional...... .........................................
District...... ..........................................
Service federations.............. .......................
Productive federations.................................
2
26
12
8
14
163
7,003
153
43
2,163
506,489
21,071,082
452,867
178,457
7,457,035
Average annual earnings
per employee, 1949 1
Range
Aver
age
$2,161-$7,880 $3,152
3,088- 3,230
2,213- 5,907
2,161- 3,562
2,691- 7,880
2,532- 4,440
3,107
3,055
3,037
6,150
3,455
Average annual earnings per employee 1
1948
1947
$2,860 $2,466
2,270
2,851
2,683
4,491
2,967
1,900
2,508
2,422
3,123
2,341
1946
1945
$2, 252 $2,160
2,478
2,294
2,049
2,710
2,313
2,124
1,963
2,459
2,364
1944
1943
$2,064
2,037
1,808
1,997
2,259
2,024
1,502
1,893
i Based on organizations reporting both employees and payroll.
Employment and Earnings, Central Cooperatives
Both employment and payrolls showed increases
in 1949 as compared with 1948 (table 12). Aver
age annual earnings per employee rose nearly $300
in the year interval.
As usual, average earnings were highest in the
productive federations; the refinery industry led the
field in that group.
Labor and Cooperatives
Cooperative Activity by Unionists
Especially in the Midwest, organized labor con
tinued its drive for development of cooperatives.
The CIO State organizations in Iowa and
Michigan, in their annual conventions, pledged
assistance in the development of consumers, co
operatives, and the national CIO convention
adopted a resolution urging the CIO unions to
affiliate with the Council for Cooperative Develop
ment. The Council is a joint labor-cooperative
organization to promote consumers’ cooperatives
in cities. Representatives of AFL and CIO act
as co-chairmen. As of the end of the year, 13
international labor unions, 3 regional cooperative
wholesales, and the Cooperative League of the
USA were members of the Council; 2 additional
unions were reported to have applied for member
ship.
In midsummer 1949, labor-supported drives for
new stores were under way in Lansing, Saginaw,
Jackson, Detroit, and Wayne, Mich., and Toledo,
Ohio. The Rubber Workers (CIO) had assigned
a full-time worker to head the campaign in Jackson; they were also active in the cooperative
expansion plan in Eau Claire, Wis., and in the
organization of a city-wide cooperative in Akron.
The Toledo campaign was being led by a full
time organizer from the United Auto Workers
(CIO). In all these cities a number of other AFL
and CIO unions were also participating.
A cooperative drive in E ast Liverpool, Ohio, by
members of the National Brotherhood of Opera
tive Potters (AFL) resulted in the opening of a
branch store in th at city by the New Cooperative
Co., a large coal miners’ cooperative with head
quarters in Dillonvale, Ohio.
Cascade Cooperative League (Seattle, Wash.)
noted th at the Washington State Federation had
appointed a special committee to work with the
League, to spread cooperation among tradeunionists. A local typographical union took sim
ilar action at about the same time.
Cooperative Managers’ Association
Early in the year the Cooperative Managers’
Association was formed in the area served by
Central Cooperative Wholesale. Any manager
of a retail cooperative affiliated with CCW is
eligible for membership, without regard to race,
creed, color, or political affiliation. The stated
purposes of the organization are to provide an
avenue for the discussion and solution of m utual
problems, to promote intercooperative good will,
to improve cooperative business and management
methods, to promote the efficiency, morale, and
character of the members with a view to raising
their standing in the cooperative movement and
with the public, and to promote vigorously the
aims and ideals of the cooperative movement.
One of the first acts of the new association was to
work out a recommended minimum salary scale
for managers, based on volume of business done
by the employing association. Also requested
were transfer of service rights when moving to the
PROGRESS IN 1949
employment of another CCW cooperative, uniform
sick leave and vacation leave, and inclusion of all
managers in the employees’ pension plan. The
association, approved by the wholesale, believes
that general adoption of these measures will help
to keep trained managers in the cooperative
movement.
Cooperative Aid to Strikers
Aid to striking industrial workers was given by
several cooperatives. During the strike of an
International Ladies’ Garment Workers’ local at
Ishpeming, Mich., the retail cooperative supplied
at cost all the food used by the strikers’ relief
kitchen. In Lansing, laid-off automobile workers
(CIO) were given a 10-percent discount on pur
chases at the local co-op store. In Negaunee,
Mich., the cooperative store (started as a result of
the 1946 strike of an independent union of iron
miners, in which the strikers received cooperative
help) and the cooperative credit union, acted to
gether for the benefit of strikers. The latters’
purchases at the store were financed by loans
from the credit union.
Strikers (members of the Mine, Mill, and
Smelter Workers, CIO) in the lead, zinc, and silver
mines of the Coeur d’Alene, Idaho, district, in
mid-1948, were assisted by donations of farm
products, canned goods, flour, etc., from individual
farmers and farmers’ cooperatives. The Pacific
Northwest Cooperator reported (issue of Decem
ber 1949) that interest in cooperation, engendered
by this experience, might result in the formation of
a new consumers’ cooperative among the miners.
Pension Plans for Cooperative Employees
The Farmers Union State Exchange (Nebraska)
voted to inaugurate a contributory retirement
system for its employees. The plan was started
January 1, 1950. All employees with 1 year of
service who have attained 30 years of age are
eligible. They will contribute 2 percent of the
first $100 of monthly salary, 2% percent of the
next $150, and 4 percent of all over $250 per
month. The wholesale will contribute about 4
19
percent of its entire payroll. Benefits include
monthly income at the rate of 1 percent of the
monthly salary for each year of participation in
the plan, but with credit for past service back to
age 40; or the employee may elect to take a smaller
amount, in order to provide payments to a de
pendent after his death. In any case, survivors
receive a refund of unpaid amounts to the em
ployee’s credit, with interest at 2 percent com
pounded annually. An employee resigning before
reaching retirement age (65 years) has the option
of receiving a refund of his contributions, with
2 percent interest, or (if he has completed 20
years’ service and is 40 years old or more) of
leaving the money in the fund, receiving at 65
whatever monthly amount his contributions, plus
those of the wholesale, will purchase. The plan
is insured with the Equitable Life Assurance
Society.
The pension system covering the employees of
Midland and Central Cooperative Wholesales and
their affiliates 13 was converted into an insured
plan in 1948, and life insurance was added. The
value of this new feature was pointed out in a
report by Mutual Service Life Insurance Co., the
insurer. The family of one deceased employee
received benefits amounting to $2,161 (as com
pared with the $102 that it would have received
under the former plan). In another case the
family received $2,772 (as compared with $323);
it also received $3,000 from the group life policy
carried by the employing cooperative for its work
ers, and $45 from the patronage group life plan—
or a grand total of $5,817. The report commented:
“ This [provision for employees] is not only con
sistent with our basic cooperative philosophy and
principles, but I am satisfied that it will do much
to attract qualified personnel toward cooperative
employment on a permanent basis.” 14 Midland’s
retirement plan covered 2,201 employees in 147
cooperatives in Michigan, Minnesota, and Wis
consin at the end of 1949. Payments to the fund
amounted to $1,182,761.
13 For a description of this plan, see U. S. Bureau of Labor Statistics Bulle
tin No. 964, pp. 13-15.
14 F. F. Rondeau, quoted in Cooperative Builder (Superior, Wis.), Aug.
18, 1949.
20
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
L egislation Affecting Cooperatives
Federal Laws
Several laws enacted in the first session of the
81st Congress were of interest to cooperatives.
One of these (Pub. No. 423) authorized the
Rural Electrification Administration to make long
term loans to private companies or cooperatives
for the building or extension of telephone facilities
in rural areas. The interest rate for such loans
was set at 2 percent— the same rate as charged on
RE A loans to electricity cooperatives.
Another act (Pub. No. 376) raised the permitted
limit for unsecured loans under the Federal Credit
Union to $400 (formerly $300). The maximum
term of loans was increased to 3 years (formerly
2). Hereafter, when a credit union’s reserve for
bad loans reaches 10 percent of its paid-in capital,
no further allocation to the fund need be made
unless the reserve drops below the 10-percent level.
Also of interest are two regulations issued in
1949 by the United States Bureau of Federal
Credit Unions which administers the Federal law.
One permits credit unions to participate in retire
ment plans, for the benefit of their employees;
they are not, however, permitted to administer a
plan of their own. The other announced approval
of a plan which would incorporate a Rochdale
principle—payment of refunds on patronage— in
credit union procedures. Optional with any credit
union’s board of directors, an interest rate may be
established by the organization that will provide
for refunds on interest paid by borrowers; in such
cases, bylaws must be revised to make this a
recognized obligation of the association.
The Public Housing Administration was author
ized (by Pub. Act. 65) to give priority, in the sale
of the three “ greenbelt” towns, to nonprofit groups
composed mainly of veterans of World War II.
(Persons residing in the town at time of sale must
be given an opportunity to join the purchasing
group and on the same terms as veterans.)
Among the groups recognized as eligible to pur
chase are mutual ownership associations, coopera
tive housing associations, and limited-dividend
corporations. The property must be sold at cost
or at its fair market value, whichever is less. If
sold on terms, a down payment of at least 10 per
cent is required and the balance must be paid
within 25 years. Interest is to be charged at 4
percent.
Several other bills of interest to cooperators
were introduced but failed to pass. Perhaps the
most important of these was the “ middle income”
housing bill (S. 2246) which would have provided
for direct Government loans to cooperative and
nonprofit groups, at the current Federal rate of
interest plus one-half percent. A new agency
would be created to administer the law.
These provisions formed Title III of the “ Hous
ing Amendments of 1949.” The bill was intro
duced rather late in the session and, although
supported by cooperative, church, veterans’ , and
labor groups, provoked much opposition, mainly
from real-estate and construction interests. The
cooperative provisions were withdrawn by their
sponsor, Senator Sparkman; and the law finally
passed under the above title contained nothing
relating to cooperatives.
After the end of the session, members of the
Banking and Currency Committees of both
Houses, to which the original bill had been referred,
toured several countries in Europe to study their
methods of dealing with cooperative housing.
A cooperative program for middle-income hous
ing was one of the items in the President’s message
to Congress, upon the convening of the 1950 ses
sion, and his proposed budget contained an appro
priation of 50 million dollars for the purpose.
In the second session, amendments to the
Sparkman bill were introduced in the Senate by
Senator Maybank and in the House by Repre
sentative Spence. Probably the most important
of these was the one creating a National Cooper
ative Mortgage Corporation and providing for
the raising of funds through the sale of its deben
tures and through forced subscription by borrow
ing cooperatives. Hearings began on January
12, 1950.16*4
3
i®The cooperative section of the bill was killed in the Senate by a vote of
43 to 38 on March 15,1950, and by the House of Representatives by a vote of
218 to 155 on March 22. The measure is therefore dead as far as the 81st
Congress is concerned.
LEGISLATION AFFECTING COOPERATIVES
Other bills introduced in the 1949 session but
not passed included (1) an amendment (S. 1679)
to the National Health Insurance bill, introduced
by Senator Humphrey, which would have specifi
cally recognized the right of voluntary prepay
ment plans, organized by cooperative or nonprofit
groups, to contract with physicians on a mutually
satisfactory basis for the furnishing of medical care
to the members; and (2) a bill (S. 1805) introduced
by the same Senator, providing an appropriation
of 25 million dollars to be used for loans to coop
erative and nonprofit groups for the acquisition,
construction, or equipment of clinics or health
centers, the program to be under the administra
tion of the Surgeon General of the United States.
State Laws
K a n s a s amended its income tax law to require
cooperatives (except those manufacturing or dis
tributing electricity) to file annual income tax
returns (ch. 458).
A M ic h ig a n act (No. 232) adds to the powers of
directors of cooperatives by permitting them to
decide whether to allow proxy voting, and if so,
when and how.
In M in n e s o ta (ch. 199) amendments were made
regarding quorums at meetings; requiring that
presidents and vice presidents must be directors,
but allowing the election of a secretary and a
treasurer who need be neither directors nor even
members of the association; and allowing coop
eratives to distribute patronage refunds in any one
of a variety of forms.
In M a s s a c h u s e tts (ch. 378) and M in n e s o ta (ch.
199) cooperative associations are authorized to
divide their territory into districts and hold meet
ings and elect delegates by districts. Massachu
setts also exempted from the Sale of Securities Law
the shares or securities of cooperative associations,
the authorized capital stock of which does not
exceed $50,000 (ch. 288). Similar action was
taken in N o r th D a k o ta (ch. 114) where exemption
was extended to all organizations distributing
their earnings on the basis of patronage.
N e v a d a Act No. 312 eliminated the former $5
fee for filing articles of incorporation by coopera
tives and substituted therefor the regular corpo
ration tax that is based on the amount of author
ized share capital.
21
The N o r th C a r o lin a revenue act was amended
(by ch. 392) to provide that cooperative and
mutual associations must hereafter pay an income
tax on all net income not allocated in patronage
refunds, and must report to the State revenue
department the names and addresses of all per
sons receiving $50 or more in such refunds or in
interest on the association’s share capital. Fur
ther, members and patrons of farmers’ cooperative
marketing or purchasing associations must in
clude, as taxable income in their own returns, all
interest and patronage returns whether received
in cash or credit.
Among the bills introduced but not passed was
a Minnesota bill, proposed as an amendment to
the bill granting a veterans’ bonus, that would
have levied a tax on cooperatives’ “ undistributed
patrons’ equity reserves” evidenced by “ written
certificates.” 16 In Utah, which has no consumers’
cooperative legislation, an attempt to enact such
a law was unsuccessful, not being reported out of
committee.
Housing
Local housing authorities in I l l i n o i s were given
permission (p. 1013) to make grants, loans, or
advances to nonprofit organizations (specifically
including therein, cooperative or mutual ownership
associations, among others) not only for the con
struction or repair of dwellings, but also for the
planning of such projects. The authority may
arrange for the lease or sale of projects owned by
them to such organizations and may use the power
of eminent domain to acquire improved or unim
proved property.
The M a s s a c h u s e tts cooperative act was amended
(by ch. 378) to permit the formation of coopera
tives to buy, sell, lease, construct, or rehabilitate
dwellings.
In N e w Y o r k , several amendments affect hous
ing projects under the limited-dividend law.17
Two have to do with the income limits of families
in such projects. One (ch. 616) provides that no
nonveteran family may continue to reside in a
limited-dividend project if its annual income
18 Cooperative Builder (Superior, Wis.), April 28, 1949.
17 Several of the cooperative apartment buildings of the Amalgamated
Housing Corp. in New York City were constructed under that law, which
gives a 20-year tax exemption on increased values arising from the project.
22
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
exceeds six times the rent plus utilities (seven
times in case of three or more dependents).
Veterans (or their widows) are allowed ratios of
7 and 8 to 1. Chapter 761 provides that in case
of projects in which tenant-members are given a
99-year lease (i. e., cooperative projects), the
ratios of 7 and 8 to 1 are also allowed; further,
over-income families may not be evicted unless
their shares of stock are repurchased by the asso
ciation, and may be allowed to remain for 3 years
or even longer, with the approval of the housing
commissioner. Another act (ch. 306) provides
that rentals in limited-dividend projects, built in
substandard areas and involving demolition of
existing structures, shall be subject to the approval
of the housing commissioner; in projects built
prior to February 1, 1947, the average rental per
room shall not exceed $15 per month in New York
County and $13 elsewhere in the State. The act
repealed a former provision setting rentals of $10
and $9, respectively, in projects that had received
a loan from the municipality and had been given
a 20-year tax exemption.
In N o r th C a r o lin a , where cooperative associa
tions are (by a 1925 amendment) called “ mutual”
associations, the Legislature in 1949 added (ch.
1042) housing to the fields authorized for such
associations. Only veterans’ organizations are,
however, permitted to be formed for housing.
The 1949 amendment also provides for the forma
tion of veterans’ low-rent housing projects, to
receive Federal assistance “ if and when available,”
as well as for “ nonprofit cooperative ownership”
housing corporations for veteran members only.
The amendment specifically states that the proper
ties of such groups “ are not exempt from the ad
valorem tax.”
An O h io act, approved July 15, 1949 (S. B. 385)
creates a new section (10186-31) of the General
Code of Ohio and provides that five or more
veterans of any war, who are citizens of the United
States and residents of the State, may form a non
profit housing corporation under the general
corporation law, to purchase property, borrow
money, and do such other things as may be appro
priate to supply themselves with housing.
In W is c o n s in , the Veterans’ Housing Trust
Fund was transferred to the department of
veterans affairs and the latter was empowered
(ch. 627) to make loans from the fund to veterans’
nonprofit and cooperative housing associations.
A cooperative housing act dating from 1919 was
amended slightly by chapter 272, to amplify the
provision prohibiting housing corporations formed
under the law from leasing to nonmembers, an
exception being made in the case of veterans;
“ veterans” was expanded to “ veterans of World
Wars I and II.” The same chapter requires landdevelopment plans within 6 miles (formerly 3
miles) of a city of the first class to have the
approval of the public land commission or city
planning commission, as well as of the common
council and the health department.
Also of interest, but not directly affecting co
operatives, was the Maine law (ch. 441) creating a
housing authority in every city and town which
elects to adopt the act, to provide low-rent hous
ing. An urban redevelopment act was adopted in
Missouri (p. 1242), replacing a 1943 law which it
repealed. In New Jersey, two laws were passed.
One provided for limited-dividend housing cor
porations, exempt from municipal taxes for not
more than 50 years and from franchise and other
State taxes, but subject to assessment to pay for
municipal services (chs. 184 and 305). The other
was an urban redevelopment act (ch. 306).
Medical Care
A P e n n s y lv a n ia act (No. 379, p. 1274) amended
the nonprofit law to include dental service among
the services permitted to be provided by nonprofit
corporations.
(Medical care was already in
cluded.)
There was no change in the pre
vious requirement that six out of nine incorpora
tors of such a corporation must be doctors. Also
continued was the statement that the act “ does
not relate to, does not affect, and does not apply
to” cooperative associations. (The provision of
medical or dental care is not among the powers
conferred upon cooperatives under the Penn
sylvania Cooperative Law.)
Among bills introduced but not passed was one
in Illinois to authorize organization of medical
care plans by consumers. In Minnesota, one bill
(opposed by the State Medical Society) would
have authorized formation of cooperative hospitals
and medical-care cooperatives. Another, in Wis
consin, would have restored to the medical pro
fession a monopoly on the operation of hospitals
(thus nullifying the 1947 law opening the field to
cooperatives). The bill was vigorously opposed
LEGISLATION’ AFFECTING COOPERATIVES
by the Wisconsin Association of Cooperatives.
It was finally withdrawn by its introducer.
Electric-Power Cooperatives
Electric-power cooperatives in C o lo ra d o were
successful in obtaining (ch. 204) repeal of a 1945
act which required them to obtain from the public
service commission a certificate of “ public in
terest.” The act had also prohibited them from
extending their lines into “ territory already served
by electric public utilities” and in which the latter
had actually constructed lines and agreed to
serve consumers “ promptly and within reasonable
time.”
A M i s s o u r i act (S. B. No. 93, approved August
8, 1949) repeals and reenacts with some changes
the previous law governing rural electric coop
eratives (Stats. 1939, sec. 5388, as amended 1943,
p. 491). A new paragraph covers rural electricity
cooperatives in areas that, by reason of growth of
population, inclusion within the limits of a
municipality, etc., have ceased to be rural in
character. Such associations may continue to
serve the nonrural sections until the service is
taken over by the municipality or until the facili
ties within that section are sold to a utility
company.
In W is c o n s in , an act (ch. 37) reportedly re
quested by rural electric cooperatives,18 designates
these associations as public utility employers, but
specifies that they are not otherwise to be governed
by the Public Utility Law (Wis. Stats., secs.
111.50-111.65). That law provides for compul
sory conciliation and arbitration of public-utility
labor disputes if the parties to the dispute fail to
reach an agreement by collective bargaining.
Rural electrification cooperatives in W y o m in g
were granted exemption from taxation for a
period of 6 years beginning February 12, 1949
(ch. 43).
Telephone Cooperatives
A la b a m a was the first State to pass any legislation
following the enactment of the Federal law (Pub.
Act 423) extending the powers of the Rural
Electrification Administration to the telephone
field. By Act No. 339, Alabama authorized
i®Midland Cooperator (Minneapolis, Minn.), April 13, 1949.
23
electrical cooperatives in the State to furnish
telephone service to members as well as to non
members, provided the number of the latter so
served did not exceed 10 percent of the total
membership of the cooperative. An electricity
cooperative that buys an existing telephone system
is allowed to serve nonmembers up to 40 percent
of the total number of members and must give
them the right to join on the same terms as
existing members. Such associations may also
make loans to assist potential member-patrons
to install apparatus and wiring.
The right to furnish telephone service is given
exclusively to electric cooperatives, and other
nonprofit organizations are expressly prohibited
from providing this service. (The effect as to
possible existent telephone mutuals and cooper
atives is not stated.) An electricity cooperative
electing to provide telephone service is prohibited
from duplicating service in any area unless existing
systems are “ unable or unwilling to provide
service.”
These associations are under the supervision of
the Alabama Public Service Commission which is
to encourage the improvement and expansion of
existing rural telephone facilities.
Credit Unions
A great deal of amendment of State credit union
laws occurred in 1949.
Amendments in I l l i n o i s (p. 628) raise the maxi
mum permitted unsecured loan to $500 (from $300)
and the maximum secured loan to $2,500 (from
$1,600); permit mergers of credit unions having
memberships with similar community or occupa
tional interest, if approved by a majority of the
board and 75 percent of the members in person or
by proxy at a special meeting; and permit a credit
union to borrow amounts not to exceed 30 percent
of its assets.
By chapter 110, I n d i a n a credit unions will
hereafter be taxed in the same manner as building
and loan associations (formerly in same manner
as savings banks).
A K a n s a s law (ch. 190) raised the maximum
permitted secured loan to $2,000 (from $1,000) or
10 percent of the credit union's total assets, which
ever is less; amplified the procedure to be followed
by the State bank commissioner in case of insol
vent associations or those that fail to make
24
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
required reports; and increased the fees charged
for audits of credit union accounts.
In M a r y l a n d , the former provision prohibiting
a board member from being a member of more
than one committee unless the total number of
credit union members is less than 11, was deleted
(ch. 139). Credit union boards of directors may,
with the approval of the State bank commissioner,
call a special meeting within 7 days after receiving
from the supervisory committee a recommendation
for the suspension of any committee member or
director. The board may also call a special meet
ing to consider any practice believed by either
that committee or the bank commissioner to be
“ unsafe and unauthorized.” (Previously, the
supervisory committee had had final authority on
these points.) Audits are required semiannually
instead of annually, and new detailed provisions
are inserted to govern the audit procedure by the
supervisory committee.
Payment of credit union dividends may here
after be made in M a s s a c h u s e tts semiannually,
instead of annually, and may be paid either from
current or previous years’ earnings (ch. 286). A
member may hereafter own up to $4,000 in
shares (ch. 287); if the credit union’s assets amount
to $200,000 or more, he may hold, alone or jointly,
up to $8,000. Shares of Federal savings and loan
associations are recognized as permitted invest
ments for credit unions, in an amount not exceeding
$5,000 for any association (ch. 341).
In M i n n e s o ta , numerous changes in the credit
union law were made by chapter 88. Hereafter,
decisions of the State commissioner of banks,
rejecting applications for charter, may be appealed
to a court of competent jurisdiction. Charters,
however, may hereafter be revoked if the share
capital is impaired or the interests of the members
are in jeopardy, as well as on grounds of insolvency
and violation of law. Amendments to bylaws
may be made by two-thirds vote (previously, by
three-fourths vote of the members present and
entitled to vote, but provided a quorum was
present). Credit unions must accept into member
ship spouses or blood relatives of members. They
are given authority to contract for life insurance
on members, to the amount of the latters’ indi
vidual share accounts, and to pay some or all of
the premium. However, if certain accounts are
not insured, their owners must be given special
dividends at the same rate as that paid on the
insurance.
Credit unions in N e w H a m p s h ir e are permitted
(by ch. 26.) to deposit their funds in savings
banks, trust companies, or national banks within
the State or (if approved by the bank commis
sioner) outside it.
Several minor amendments were made in the
N e w ! o rk credit union law. Chapter 590 amends
the previous provision allowing a maximum loan
of $4,000 or not to exceed 4 percent of the credit
union’s capital by adding “ whichever is lower.”
It also rephrases the former provision to permit
credit unions with assets of more than 5 million
dollars to make first mortgage loans on real estate
in aggregate amounts not exceeding the limits
indicated above.
Under chapter 589, hereafter only shares fully
paid at the end of the year are entitled to dividends
but shares withdrawn on any of the five calendar
days preceding the close of the year may be con
sidered as on the books at the end of the year.
Chapter 17 merely corrects a previous typograph
ical mistake and chapter 15 amends the provision
requiring the calling of a special meeting to deal
with a situation arising from the suspension of
the credit committee by the supervisory com
mittee, by inserting the phrase “ of any member”
before the words “ credit committee.”
Extensive changes and additions were made in
the O h io act, which forms 9676-9694 of the Ohio
General Code. Section 9682 was amended by the
addition of a new sentence providing that, in case
of joint memberships, a written receipt for with
drawals paid to either person or the survivor shall
be a valid release of obligation for the credit union.
Loans of central credit unions to other credit
unions are exempted from the requirement of
approval by the board of directors. Real-estate
mortgage loans may not be made in an amount
exceeding 25 percent of a credit union’s total
assets. Investment in real or personal property
by a credit union may not exceed 5 percent
(formerly 3 percent) of its assets. Credit unions
are given authority (1) to expel any member with
shares of less than $5 who has left the field of
membership or failed to meet the condition for
membership, and to transfer the money in his
account to the reserve fund 10 days after notice of
intention to do so was mailed to his last-known
LEGISLATION AFFECTING COOPERATIVES
address, and (2) to merge with other credit unions
upon approval by the State division of securities.
Section 9684 was amended by striking out, from
the former limitation on share ownership by any
member (i. e., not more than $2,000 or 10 percent
of the outstanding stock), the figure $2,000.
To section 9685 is added a new paragraph per
mitting officers, directors, and members of State
and Federal credit unions to form a credit union
in which they have membership and from which
they may borrow.
Hereafter, loans must have the approval (sec.
9686) of only a majority of the entire credit com
mittee, and of all those members present (form
erly the unanimous approval of the committee
was required). Loans to other credit unions
(except by a central credit union) must have the
approval of a majority of the board of directors
as well.
The maximum unsecured loan permitted (sec.
9687) is raised to $300 (previously $100). B y a
majority vote at an annual or special membership
meeting, directors, officers, and committee mem
bers may be permitted to borrow on the same
terms as other members, provided the total loans
to the whole group do not exceed their “ combined
equity” (this phrase meaning the ratio of their
assets in the association to the total credit union
assets). (Previously they were prohibited from
borrowing in excess of their paid-in shares, except
on the affirmative vote of two-thirds of the mem
bers present at a regular or special meeting,
written notice of which had been given.)
Yearly appropriations to the reserve fund (sec.
9688) need hereafter be only sufficient to keep
that fund at a level equal to 10 percent (formerly
20 percent) of the paid-in share capital.
A limit of $650 was placed on the annual charge
for examinations of credit union accounts (sec.
9689) .
New provisions (secs. 9690-9692) for procedure
in case of insolvency provide for temporary sus
pension of activities, to protect the members, as
well as for eventual cancellation of charter if
warranted. If the division of securities is dis
satisfied with the manner of liquidation it may
appoint a bonded agent to carry out the liquida
tion. His powers are specified, as well as the
manner of payment of his expenses, but the latter
may not exceed 10 percent of the assets existing
at the time of his appointment.
25
Two new sections (9693 and 9694) relate to
central credit unions and provide procedure for
existing credit unions in Ohio to incorporate under
the present act.
In R h o d e I s la n d (ch. 2287), issuance of a credit
union charter within 60 days after application
therefor is mandatory (formerly optional only)
when the commissioner is satisfied that the public
convenience will thereby be served (formerly
when satisfied that the proposed field of operation
was favorable to the success of the proposed
credit union). Credit union bylaws need no
longer specify the conditions of residence or
occupation qualifying persons for membership.
Every loan granted must have the approval of
the credit committee, “ subject to any limitations
set by the board of directors.” By unanimous
vote of its directors, a credit union may borrow
from another an amount not more than 25 percent
of its combined capital and surplus. Another
amendment (ch. 2337) authorizes payroll deduc
tions from salaries of State employees to the
Rhode Island State Employees Credit Union
whenever the office of the State controller is in a
position to assume the extra work involved.
Extensive changes were made in the T e x a s credit
union law by chapter 173. Credit committees
will no longer be composed of directors, but will
be elected independently. Hereafter, credit union
funds may be invested only in shares of building
and loan associations in the State insured by
the Federal Savings and Loan Insurance Corpora
tion, but the former limitation on loans to such
associations (i. e.; not over 5 percent of combined
capital and surplus) was stricken out. The
board’s authority to fix the amount of entrance
fees was transferred to the general membership
meeting (which will receive the board’s recom
mendation). A transfer in the opposite direction
was made as regards fixing of the maximum loans
and shareholdings’; hereafter this will be done by
the board instead of the membership meeting.
Fees for examination of credit union accounts
were raised to $32 per day per auditor engaged
(from $25) or a total fee of not to exceed $3.50 per
$1,000 of assets, whichever is less. Other minor
changes in phraseology were made.
The U ta h credit union law was amended (ch. 8)
to raise the total loans permitted to be made to
any one member to $6,000 (from $3,000) and to
authorize the board of directors to lend money to
26
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
or borrow from banking institutions and other
credit unions.
In W est V irg in ia , the law was amended by
chapter 25 which (1) eliminated the $10 incorpora
tion fee formerly charged, (2) revised the examina
tion fees upward, (3) eliminated the penalties for
not filing reports, (4) raised the permitted maxi
mum unsecured loan to $300 (from $50), and (5)
gave the board of directors the authority to
decrease the annual allocation to reserves when
the latter equal 20 percent (formerly 100 percent)
of the association’s capital.
A new section (ch. 403) in W isconsin provides
for (a) an annual fee based on a credit union’s
proportional share of the cost of maintaining
the State Credit Union Division, but not to exceed
$100, and (b) assessments for examination based
on the cost of the time spent by auditors and others
and “ any other expenses directly attributable
thereto.” Failure to pay these charges shall be
grounds for revocation of charter. (Formerly,
credit unions were charged not over 25 cents per
$100 of assets, or the actual cost of the examina
tion, whichever was less, but not less than $10.)
Court Decisions
Insurance
of Colorado and North Dakota set different limits
The
association’s procedures conformed to the
A final decision on a case that has been in the
Colorado
requirements and “ the court adopts it”
courts for several years was handed down by the
and
holds
that the loans made were therefore not
North Dakota Supreme Court {N ation al Farmers
excessive,
(d) The “ record does not support a
U nion L ije A ssociation v. K reu ger , 38 N. W. (2d)
finding
that
the association refused to permit
563) on July 1, 1949.
examination.”
The district court of Burleigh County, review
2. Charged: That the association failed to abide
ing a decision of the State commissioner of insur
by the terms of its own contracts in that (a) it
ance that denied a renewal of license to the Na
allocated to death benefits a flat amount from the
tional Farmers Union Life Association, had di
premiums, without regard to the age of the in
rected that the license be issued on certain
sured, and (b) it valued the patronage group
conditions. From the court’s decision the com
policies not according to the contract but accord
missioner appealed to the State supreme court.
ing to inaccurate and arbitrary reserve methods.
The association was organized under the law of
Found: (a) The association’s procedure was due
Colorado but had been licensed for business in
to lack of information on the ages of all persons
North Dakota. The grounds given by the com
under
family contract, but was a violation of the
missioner for his refusal and the finding by the
North
Dakota law. The flat-rate deduction, how
supreme court are summarized below:
ever,
produced
a reserve greater than would have
1.
Charged: That the association violated the
been
produced
by the contract method. This
statutory requirements for fraternal organizations
fact,
and
the
concurrence
of the insurance exam
in that (a) it failed to initiate members, (b) it
iner
in
the
practice,
“
indicate
that the association
made contracts payable to beneficiaries (specifi
has
acted
in
good
faith.”
The
association offered
cally the United States Government) not within
to
make
an
appropriate
change
in the contract
the permitted classification, (c) it made loans
and
its
offer
was
accepted
by
the
court.
larger than the statutory limits, and (d) it refused
3. Charged: That the association adopted prac
to permit examination of its books by the insur
tices
in fiscal management and accounting that
ance department. Found: (a) Evidence highly
endangered its solvency. Specifically (a) it in
unsatisfactory, but it appears such initiations were
vested an excessive proportion of its assets in
not held, (b) Payment to Government would be a
loans to “ new and speculative cooperative enter
violation, but as the procedure had been approved
prises,” (b) it unwarrantedly charged off certain
by the previous commissioner, the violation “ was
sums, (c) it made loans in which the officers of
neither willful nor in bad faith.” (c) The laws
COURT DECISIONS
the association had a direct personal interest, (d)
it paid the president an excessive salary, and (e)
it entered fictitious assets on its books. Found:
Charge (a) appears to be “ a pure conclusion un
supported by any evidence.” No loan was exces
sive, no loan in default as to principal or interest.
“ We know of no economically sound reason why
a business recession would be more detrimental to
a cooperative enterprise than it would be to other
modes of business activity.” (b) The commis
sioner’s “ conclusion is not sustained by the record.”
(c) One such loan was made, which was improper
“ even though the society and its certificate holders
were amply protected.” (d) Evidence not suffi
cient to prove that the president’s compensation
(salary and bonus totaling $7,000 per year) was
excessive, (e) One investment was made which
was “ unauthorized” by law. There was direct
evidence that the assets entered on the books were
not fictitious; there was no direct evidence, only
“ conclusions,” that they were. “ The direct testi
mony must prevail.”
The court decided that in view of the adequate
protection of the certificate holders, and the fact
that the violations complained of were either ap
proved by the commissioner’s predecessor or con
doned by his own examiners, cancellation of license
“ is too drastic a penalty.” The commissioner’s
decision was therefore ordered to be modified to
read that the license would be denied unless the
association “ within a reasonable time shall furnish
to the commissioner satisfactory evidence that it is
doing business in accordance with the laws of this
State” (North Dakota).
Housing
In Ohio, an attempt by adjoining property
owners to prevent a cooperative association from
operating a trailer camp on land owned by it was
frustrated by a decision of the Court of Common
Pleas rendered August 7, 1949. (.E dw ards et a l.
v. Ohio State S tu den ts ’ Trailer P a rk Cooperative,
In c., 88 N. E. (2d) 178.) The petitioners relied
upon a covenant restricting the uses of the land
in the area. The court found, however, that only
the first 11 deeds (of 66) had contained the restric
tions and that the cooperative’s land was not
among them. The association was therefore not
bound. The petition was dismissed, with costs
27
payable by the plaintiff, and the latter’s petition
for a new trial was dismissed.
Cooperative Colony
An echo from the past arose in a case involving
the now-defunct Llano Cooperative Colony, in
Newllano, La. An action was brought in behalf
of the colony in the District Court of Appeals for
the Fifth District, by George T. Pickett, former
general manager of the colony. The colony,
started in 1914 in California, moved to Louisiana
several years later. The colony had a difficult
and somewhat checkered career, and there was
considerable difference of opinion among coopera
tors as to its soundness. It remained in existence
for over 20 years, however, with membership and
assets growing slowly. In consequence of a schism
in the membership, culminating in a pitched battle
and gunfire, the colony was thrown into bank
ruptcy early in 1937. Both factions claimed the
assets, but the State court held that neither was
entitled to act for the colony. The complainant
in the case under review {Llano del B io Co. of
N evada v. A nderson-P ost H ardwood Lum ber Co.,
In c., et al., 79 Fed. Supp. 382) charged the defend
ant company, the receiver in bankruptcy, two
judges of the State court for the parish, and others,
with conspiracy to defraud the colony. It was
claimed that property worth $13,500,000 was de
valued to $40,000, of which $30,000 had “ already
been consumed as expense of said receivership,”
and that the town of Newllano (60 acres in ex
tent, with houses, hotel, shops, and industrial
enterprises, worth about $1,850,000) was sold for
$6,390. Twelve motions to dismiss the case were
filed, among them several signed by “ erstwhile
members” of the colony who claimed that no regu
lar membership meetings had been held by the
association. (This particular claim was dismissed
by the court.)
After reviewing all the facts, the Federal court
was of the opinion that “ conceding, for the purpose
of this issue, that all the charges against the several
defendants, including the judges, are true,” the
State court decisions are binding until set aside.
That can be done only in the court rendering the
decision, and then only on proof of fraud. That
being so, the court found it unnecessary to consider
the points raised by the complainant. The case
28
CONSUMERS* COOPERATIVES: OPERATIONS IN 1949
was dismissed, and the plaintiff was advised to
bring the suit in the proper court.
Taxation
Three tax cases decided in 1949 are of interest.
One case {F ountain C ity Cooperative Cream ery
A ssociation v. C om m issioner o j In tern al Revenue,
172 Fed. (2d) 666), decided February 2, 1949, was
an appeal to the United States Court of Appeals of
the Seventh Circuit from a decision of the United
States Tax Court assessing increased tax against
certain patrons’ equity certificates. After paying
the 5 percent interest on shares, the association’s
board of directors decided to put all the year’s
remaining earnings into these certificates, payable
to members and nonmembers. The certificates
were, however, subject to seizure for debts of the
association, were transferable only on its books,
bore interest only if so decided by the directors,
and (in case of liquidation) had the same status as
common stock. A year after this action was taken
it was. ratified by the members and the bylaws
were changed to cover it. The court of appeals
held: “ It is clear from the foregoing that instead of
this equity reserve belonging to the patrons, it
never left the control of the association, which con
tinued to treat it as its own. Its creation lay
within the absolute discretion of the taxpayer’s
directors and, after creation, its continued exist
ence was wholly at the will of the taxpayer’s
directors. This reserve never belonged to the
patrons. It was and always remained the prop
erty of the taxpayer and was properly included by
the commissioner in the taxpayer’s gross income.”
The judgment of the tax court was affirmed.
In the second case {Farm ers Cooperative Co. v.
B irm ingham , Collector o j In ternal Revenue, 86 Fed.
Supp. 201), the association had until 1944 operated
under the general corporation law of Iowa. At
th at time it reorganized as a nonexempt agricul
tural cooperative. Under the State cooperative
law it was obligated to pay patronage refunds to
members. The association sued the Collector of
Internal Revenue to recover taxes paid on these
refunds. In a long decision dealing with various
aspects of the taxation question as related to co
operatives and others, the United States District
Court for the Northern District of Iowa held th at
the cooperative was entitled to recover on refunds
paid out of earnings made during its period of
operation under the cooperative law—when it had
a clear and mandatory obligation to pay them—
but not for the period of operation under the cor
poration law.
The United States Tax Court rendered a deci
sion on August 2,1949, in the third case, ConsumerF arm er M ilk Cooperative, In c . v. Comr. o j In tern al
Revenue. The association, claiming that it was a
social welfare organization and, as such, exempt
from taxation, sued to recover income and excess
profits taxes which it had paid. The cooperative
had been organized by a group of welfare workers
and their organizations, both to protect the public
interest and to help the milk producers. To sup
port its tax-exemption claim, the association cited
a number of beneficial activities in which it had
engaged. Its earnings were, according to its by
laws, to be divided among the milk producers and
the patrons who bought the milk. The court
pointed out, in its decision, that consumers’
cooperatives have no exemption from Federal
income tax; also, that in order to claim a patronage
refund the customer had to clip out and return a
voucher from each carton of milk purchased.
Actually, less than 3 percent of the earnings
declared as available for customers’ refunds was
claimed in 1943 and less than 8 percent for the
years 1939 through 1943. Unclaimed refunds
became part of the net worth of the association.
The court also noted that no part of the earnings
for 1943 was put into the educational fund, nor in
fact had this been done in any year after 1942.
As neither the charter nor bylaws contained any
provision as to the distribution of surplus, pre
sumably such surplus would, in case of dissolution,
be distributed among the association’s members.
The court concluded, therefore, that the associa
tion’s contention of being operated exclusively for
the promotion of social welfare had not been
proved; and further, that the association had not
really expected “ more than a negligible number of
consumer patrons” to tear off and return the
vouchers for refund. (Refunds actually paid to
either the farmer-suppliers or the patrons had,
however, been allowed as excludable from taxa
tion by the Bureau of Internal Revenue.) The
court therefore upheld the decision of the Com
missioner of Internal Revenue that the association
was properly liable.
29
International Developments
Cooperative Principles
A redeclaration of the free and voluntary
character of cooperatives was made by the Execu
tive Committee of the International Cooperative
Alliance in Paris in November 1949. The matter
arose in connection with applications by several
countries for membership in the Alliance.
The International Cooperative Alliance rules
specify that only those cooperatives are eligible
for admission which have for their object “ the
economic and social betterment” of the members
and which conform to the Rochdale principles of
voluntary membership, democratic control, dis
tribution of earnings, and limited interest on
capital.
The committee recognized that the Alliance
would be completely changed in character if it
were to accept organizations which granted “ to
the State, in theory and practice, the right of full
control of their activities and even of incorporat
ing them into the State structure whenever re
quired to do so by the State.”
The committee pointed out that freedom of
association is absolutely essential to the growth
of cooperatives and that such freedom cannot
exist “ in countries which deny freedom of associa
tion in general to their citizens: that independence
of cooperative organizations implies that these
organizations should have the right to take a
stand on problems affecting their own or the .gen
eral interests; independence not only of the State,
but also of private organizations (political parties)
and that real cooperative democracy means, to
gether with the democrative control of the or
ganizations on the basis of free elections and
equal rights of the members required by the rules
of the International Cooperative Alliance, full
freedom from interference or pressure from out
side.”
Only by adhering to these principles, the com
mittee stated, will the cooperative movement “ be
in a position to fight against oppression and for
the liberation of all social groups, thus contribut
ing to insure peace.”
Among the membership applications pending
were those from (1) six regional unions in the
Eastern Zone of Germany, together with the
Union of German Cooperative Societies, estab
lished in August 1949, of which these unions are
members, (2) an association of Chinese industrial
cooperatives (i. e., workers' productive associa
tions), (3) a small consumers' cooperative in
Santiago, Chile, and (4) the Federation of Hun
garian Cooperatives, created by a government
decree of M ay 22, 1949, to replace a former
organization (dissolved by the same decree)
which had been denied membership in the Alliance
in June 1949. The committee postponed decision
on the German organization until its next meeting,
pending receipt of further information. Action
on the Chinese and Santiago applications was
likewise deferred, in view of the uncertain condi
tions in China, and the possibility of the creation
of a national federation in Santiago.
The Hungarian application was rejected. The
committee decided, on the basis of the accom
panying documentary information, that the Fed
eration did not meet the International Cooperative
Alliance requirements regarding “ genuine cooper
ative activity.”
Neither the Czech nor Soviet Union Representa
tives were present at the meeting.19
Underdeveloped Countries
The International Cooperative Alliance at its
congress in September 1948 had passed a resolution
urging expansion and use of cooperatives in un
derdeveloped countries. Early in 1949 a Canadian
cooperator told the United Nations Subcommittee
On Economic Development how cooperatives had
assisted in the economic rehabilitation of the
Maritime Provinces in Canada, and the com
mittee decided to make an official study of coopera
tives as part of its work. Its report, however,
contained practically no mention of cooperatives.
The report was rejected by the Economic Em
ployment Commission and the subcommittee was
abolished.
A technical meeting on cooperatives was held at
Lucknow, India, sponsored by the Food and
19 Data in this section arefrom Review of International Cooperation (Inter
national Cooperative Alliance, London), December 12,1949.
30
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
Agriculture Organization of the United Nations.
The result of this meeting was a series of recom
mendations on government action in the Far East,
urging (a) government fostering of conditions
favorable to cooperatives and guidance for them,
(b) exemption of cooperatives from taxation,
(c) encouragement of educational courses in
cooperatives in schools and colleges, and prepara
tion of an educational handbook, (d) government
assistance to cooperatives, official recognition of
their finance institutions, and guaranty of coopera
tive bonds and debentures, (e) FAO assistance in
formation of cooperative educational, auditing, and
other federations, (f) government assistance in the
organization of various types of cooperatives and
preference to cooperatives in allocation of export
and import quotas, and (g) separate government
departments for cooperatives.
The ICA proposal to place Middle East oil
resources under a U. N. authority was on the
agenda of the Economic and Social Council
meeting in September, but was postponed. It
was to be presented again at the February 1951
session.
Petroleum Products
At the second annual meeting of the Inter
national Cooperative Petroleum Association, in
Stockholm, Sweden, in June 1949, it was reported
that the association's brokerage activities in petro
leum products had netted earnings of $150,580 for
the year ending April 30, 1949. (Earnings for the
previous year were $19,355.) As $127,072 of this
amount consisted of patronage refund certificates
(payable 6 years hence) from Consumers Cooper
ative Association (Kansas City, M o.), the petro
leum association deferred the return of all its
earnings in patronage refunds until the total is
available in cash. As of the end of its fiscal year,
16 cooperatives in 16 countries were full members;
associations in 12 other countries were in process
of qualifying for membership.
The general manager reported that the growth
of the organization had been retarded by currency
restrictions and by difficulties in obtaining foreign
currencies. A resolution adopted by the meeting
urged all the members to work for relaxation of
restrictions in their respective countries. It was
reported that the cooperative wholesales in both
France and Sweden have obtained recognition
from their governments as importers of oil, and
the latter association is importing cooperative
lubricating oil from the United States in its own
tankers.
One of the important matters discussed at the
meeting was the financing of a refinery to be
situated somewhere in Europe. The petroleum
association (the headquarters of which are in New
York City) has as yet no production facilities of
its own.
Appendix.—Cooperative Medical Care in 1949
More than 92,000 persons were fully paid mem
bers of 52 associations providing medical or hos
pital care, from which the Bureau of Labor Sta
tistics obtained data in a special study covering
the year 1949. Including dependents as well as
members, some 289,000 persons were eligible for
care. The income of these cooperatives in 1949,
from all sources, totaled $6,592,775.
Of 38 associations planning to operate a medicalcare clinic, 31 had the enterprise in operation by
the end of 1949. Of 52 hospital associations, 32
had the hospital open for service. Texas accounted
for 24 of the total number of hospitals, and of
these, 18 were in operation at the end of the year.
The same State had 14 of the medical-care asso
ciations ; all of these clinics were operating (table A).
T able
A.— Geographic distribution of active,
medical-care associations, end of 1949
Associations providing
general medical care
Geographic division and State
19
Middle Atlantic:
New York_____________
Pennsylvania__________
East North Central:
Wisconsin______________
West North Central:
Iowa__________________
Kansas..............................
Minnesota— ___________
Missouri_________ ___
Nebraska....... ...................
North Dakota__________
South Dakota...................
South Atlantic:
District of Columbia........
Florida..............................
North Carolina_________
South Carolina_________
East South Central:
Mississippi_____________
Tennessee,........................
West South Central:
Arkansas___ ___________
Louisiana______________
Oklahoma......................
Texas..... .................. ........
Mountain:
Arizona________________
Colorado.......... .................
Idaho________ ______ __
New Mexico____________
Utah.................................
Pacific:
California______________
Oregon________________
Washington......................
1
38
31
11
11
4
1
1
1
Hospital asso
ciations
52
32
3
2
1
1
1
1
3
31
(2)
32
2
1
1
2 421
1
1
42 43
1
43
1
1
1
1
2
83
1 614
1
1
31
1
1
1
8
3
614 8241
1
31
31
1
1
(2)
818
31
6
33
33
32
3 2
2
42
42
44
42
1
1
1
1 Diagnostic clinic.
3 N ot including 1 association which owns building but leases it for opera
tion.
* One association operates both clinic and hospital.
4 Two associations operate both clinic and hospital.
8 Three associations operate both clinic and hospital.
8Thirteen associations operate both clinic and hospital; not including
2 associations which own building but lease it for operation.
The nonprofit law had been utilized by the
largest group (32 associations), but 14 had incor
porated under the State cooperative law and 2
under the regular corporation law (but one of
these was in process of reincorporating under the
cooperative law). One contract group had not
incorporated.
Age of Associations
As the statement below indicates, the largest
group of medical-care cooperatives was formed in
1945. That was the year in which Texas passed
its law authorizing the establishment of coopera
tive rural health associations. The following year
was productive of nearly as many medical-care
cooperatives.
Number
known
On con Own facilities
Hospital
tract:
Total in opera
Number
tion
of asso Total inClinic
opera
ciations
tion
United States................ ........
Law of Incorporation
Year of form ation:
elations
2
Before 1900___________________________
1900-10_______________
3
1926-30___________________
3
1
1931-35_________
1936-40_______________________________
4
1941-44___
4
10
1945 ________________________________
1946 ________________________________
9
1947 ________________________________
4
1948 ________________________________
6
1949 ________________________________
3
Time Required To Become Operative
Altogether, of 48 cooperatives reporting, 23 were
able to put their enterprise into operation in less
than a year after the formation of the group.
Eight of these were associations which had no
facilities of their own but simply made a contract
with established physicians to provide care for
their members. It had taken six associations
between 1 and 2 years to get the medical-care
program under way; six others, between 2 and 3
years; five, between 3 and 4 years; one, between
4 and 5 years; and one, between 6 and 7 years.
Six organizations still had not been able to put
their plan into effect. Two of these had been in
existence less than 1 year, but one had been formed
from 1 to 2 years before; one, 2 to 3 years before;
and two, 3 to 4 years before.
Sources of Funds
Membership fees provided at least part of the
funds for building and equipping the clinic and/or
hospital in 41 cooperatives, gifts in 26, and loans
31
32
CONSUMERS’ COOPERATIVES: OPERATIONS IN 1949
in 23. Five cooperatives had aid from public
sources (i. e., town, county, or Federal authori
ties), two held social events to help finance the
enterprise, and one applied the income from some
Government bonds.
Amount of the investment (usually termed
“ membership fee”) required in various associa
tions from each member is shown below:
Amount required:
association*
N one_________________________________
9
1
$ 2.00 ________ . . _______________________ _________
$ 2 .2 5 ....................................... - .........................
1
$ 20.00___________________ ______ - ______ ________
1
$ 2 5 .0 0 -..........
1
$35.00-$l50.00 1............
1
$50.00........................
8
$75.00...............
4
$100.00_________________
15
1 According to age.
Operating funds came from various sources:
members, dues (in 43 associations), fees for service
(in 31), sale of drugs (in 23), laboratory and X-ray
service (in 3), and social events held by the associa
tion (in 2). Only one of the cooperatives reporting
was a capital-stock organization, with part of its
funds coming from the sale of shares.
Facilities and Staff
Nine associations had no facilities of their own,
T a b l e B .—
but only a contract with physicians; and three
provided only cash benefits in reimbursement of
members’ expenditures. Of 40 associations with
their own facilities, 9 were operating a hospital, 10
a clinic, and 21 both hospital and clinic. One had
a ward in a hospital.
The 29 reporting hospitals that were in operation
had 1,115 beds, or an average of 37 each. Three
hospitals were under construction. One of these
was a small building with only 12 beds, and another
had 25; the size of the third was not reported.
Thirty-three cooperatives reporting had a total
of 175 full-time staff physicians, as well as 368
giving part-time service. Full-time nurses (re
ported by 34 cooperatives) totaled 422; these
groups also had 76 part-time nurses.
One group employed 1 full-time dentist; and
another, 12 dentists (full and part time).
Activities in 1949
Table B shows that, in addition to the 92,073
fully paid members, there were 5,442 persons who
had indicated their intention of joining and had
paid part of the membership fee or other require
ments. The greatest activity was shown in the
West South Central States (especially in Texas)
and in the Pacific region (notably California).
Membership and income of reporting medical-care associations, by type and geographic loaction, 1949
Associations providing medical care
On contract
Geographic division and State
United States __ __
_
__ __
8,962
8,981 $381,739
Members
Own facilities
Total Income NumNum
ber of Mem eli from all ber of
associ bers gible
for sources associ
ations
ations
care
12
Hospital associations
10
Num
Members
ber of
Total Income associ
eligible from all ations
Paid Partly for care sources
up
paid
26,162
986
186,826 $986,452
Paid
up
30 56,959
Total Income
eligible from
all
for
Partly care
sources
paid
4,457
94,317 $5,224,584
Middle Atlantic:
Pennsylvania . _
1 9,000
19,000 162,000
East North Central:
1 632 632 (9
1 489
Wisconsin___________________
1,467
18,972
West North Central:
Kansas
___ __ _
*1
150
4,000
1,250
305,238
Minnesota ___ ______
2 2,198 780 118,796 (9
South Dakota __ _
. _ _
*1 843 50 1,500
(9
South Atlantic:
1 7,041
District of Columbia_________
17,500 730,343
Florida........................ .............
5,664
602,630
2 3 11,162
North Carolina _ ___
1
42 23,662
12
East South Central:
Mississippi
1 19,165
26,535
125,120
1 36 36
Tennessee__________________
330
West South Central:
Arkansas___________________
1 1,306
1,306 40,447
Louisiana
. .
2 1,196 4,000 26,664
* 3 3,469
15 8,874
473,000
Oklahoma__________________
i
1 Texas
185
860 30,000
416 7,347 2,109 19,163 1,604,085
.........................................
648
648 12,000
215
Mountain:
Colorado. _ _ __ _ .
1 445 446 9,398
*1
500
664
31,899
164
Utah. _
1 0) (9 30,000
Pacific:
1 9,000
9,000 1,233,771
2 6,000
California___________________
16,000
3 3,230 3,230 206,000
(9
Oregon .
_ _ ___
1 380 20 12,322 (9
Washington...... .........................
2 2,876 95 98,447
82 4,075 1,633 17, 450 929,869
i No data. 21 association operates clinic also. * 3 associations operate clinic also. 412 associations operate clinic also. 82associations operate clinic also.
33
APPENDIX
Prepayment Plans
T able
Physicians’ services were available on a prepay
ment basis in 33 associations; in one case, however,
this covered physical examinations only. Twentyfive hospital cooperatives offered their services on
a prepayment plan.
Nonmembers are also admitted to service on the
prepayment plan in 29 clinics and 23 hospitals.
In some cases, however, higher rates are charged
to them than to members.
Dues are payable monthly in
13 associations, quarterly in 4, semiannually in 2,
and annually in 25.
The extreme variation in monthly dues for serv
ices on the prepayment plan in 41 associations is
shown in table C.
P r e p a y m e n t d u e s.
T able
C.— Monthly dues charged on prepayment plan, by
type of cooperative, 1949 1
Adults
Type of associa
tion, and number
Mem
ber
Dependent children
Other
de
Wife pend
ents
1st 2d
3d
All
4th 5th over
the
5th
Medical care
No. 1:
With hospital
care_______
Without hos
pital care___
No. 2............. .......
No. 3............. .......
No. 4.....................
No. 5....................
No. 6.....................
No. 7....................
No. 8..... ...............
$3.50 $3.50 $3.50 $2.25 $2.25 $2.25 $2.25 $2. 25 $2.25
3.00
1.50
3.25
2.50
1.78
.75
1. 50
1.33
3.00
1.50
2.75
1.50
.84
.38
3.00 2.00 2.00 2.00 2.00 2.00 2.00
1.50 1.50 1. 50 1. 50 1. 50 1.50 1.50
1.00 1.00 0 0 1.00 0 0
1.00 1.00 .50 .50 .40 0 0
.33
1.25 .42 .33 .33 .33 .33
.25
.25 3.13 3. 13 3.13 3. 13
0.67 0.17 0.50 0.33 0 0 0
0 0 0
3.13
0
0
Hospital care
No. 1................ .
No. 2.....................
No. 3.....................
No. 4.....................
No. 5.....................
No. 6. ...................
No. 7.....................
2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00
2.50 1.00 1.00 1. 00 1. 00 1.00 1.00
1.00 .50 1.00 .33 .17 .17 .17 .17
1.00 .50 .33 .33 .25 0 0 0
1.25
.42 1.25 .42 .25 .25 .25 .25
2.67 0
0 0 0 0 0 0
3.00 0
0 0 (9 0 0 0
3.25
2.00
1.00
.17
0.25
0
0
Medical and hos
pital care
No. 1.....................
2.00 1.00
No. 2....................
1.33
.67
No. 3.....................
1.50 .67
No. 4................
1.67 1.00
No. 5................
1.60
.67
No. 6.....................
82.17 0
No. 7.....................
1. 00 .50
No. 8.....................
1.67 .67
No. 9.....................
1.33 .67
No. 10...................
1.88 .80
No. 11....................
1.67 .33
No. 12...................
1. 42 .58
No. 13...................
1.25
.83
No. 14...................
2.17 0
No. 15........ ..........
1. 67 .42
No. 16...................
2.17 0
No. 17...................
4.00 3.00
No. 18...................
3.00 3.00
No. 19....................
2.00 1.00
See footnote at: end of table.
C.—Monthly dues charged on prepayment plan, by
type of cooperative, 19491—Continued
Dependent children
Adults
T yp e of associa
tion, and number
M em
ber
Other
de
Wife pend 1st
ents
2d
3d
4th
5th
A ll
over
the
5th
Medical and hos
pital care—Con.
N o. 20......................
N o. 2 1 ..................... /
2.00
9 4.00
\ 102.00
2.00
}«
2.00 2.00 2.00 2.00 2.00 2.00
0
0
2.00
0
0
0
0
0
0
0
0
0
0
0
0
0 0 0 0
0 0 0 0
1.00
0.75 0.50 0.50 0
0
Contract
[
1.35
N o. 1........................ \ to
l 3.83
2.00
N o. 2 ......................
3.00
No. 3............. ..........
No. 4 ....................... u 5.00
1.88
No. 5........................
1.00
0
1.88
1.00
1.00 1.00 1.00 1.00 1.00 1.00
01.88
.75
.75
1All charges (quarterly, annual, etc.) reduced to monthly basis.
2 No charge.
3 Plus $1 for first house visit in each illness.
4 N o data.
6 Includes wife.
6 Included in husband’s (i. e., “member's") rate.
7If under 15 years of age.
8If family includes children under 18 years.
9Working members.
10 Retired members.
11 Plus 10 percent of discounted doctor bills.
Cooperative Procedures
Of 41 associations reporting as to voting pro
cedures, all but 1 allow only 1 vote per member.
The one exception allows one vote for each share
of stock held. Thirty-two of the 42 cooperatives
reporting as to voting by proxy prohibit proxies;
the 10 others allow them (but in 2 cases, only in
votes on a change of bylaws or on articles of incor
poration, respectively). Nine associations allow
voting by mail; 30 do not.
One organization had closed its membership and
would admit no more.
The size of the board of directors varied widely.
The distribution of the 46 reporting associations,
by size of board, was as follows:
Number of
.33
0
0
0
1. 50
0.50
1.00
.67
.80
1.00
.67
.50
.67
.67
.33
.42
.33
.33
.67
.33
.33
.33
.33
.50
.33
.50
.42
.33
.42
.25
.33
.67
.25
.33
.33
.25
.33
.33
.33
.33
.25
.17
.17
.67
.25
.17
.33
.25
.17
.42
.17
.25
.17
.17
.67
.25
.17
.33
.25
.17
.42
.17
.25
.17
.17
.67
.25
.17
.33
.25
.17
.42
.17
.25
.17
.17
.67
.25
.17
.33
.25
.17
.42
.17
0 0 0 0
0 0 0 0
0.33 0.33 0.33 0.33
.67
1.25
.17 0
0
.42 .42 .42
.17 0
0
3.00 1. 50 1. 50 0
0 0
3.00 71.50 71. 50 71.50 71.50 71.50
81.33
81.30
8
1.33
«1.33
«1.33
0
701. 50
81.33
Number of directors:
associations
Under 5_______________________________
3
5_____________________________________
9
7 _____________________________________
10
9 ____________________________________
12
10 to 16_______________________________
8
30 or more____________________________
4
The 45 cooperatives reporting had a total of 498
directors. Of these, all but four were chosen by
the membership; the four were chosen by the
public. In no case had the medical staff any
representation on the board.
U. S. GOVERNMENT PRINTING OFFICE: 1081
@FedFRASER