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Paul Revere Cooperative information:
On October 3, 2005, the Paul Revere Community--an almost 16-acre property that includes 153 manufactured home sites, private streets, and a well--became the second resident-owned manufactured home park in the state. The Paul Revere Cooperative (made up of Paul Revere's residents) bought the park as part of a settlement agreement that resolved a class-action lawsuit that residents brought against the Community's former owners.
WHAT IS A COOPERATIVE?
A cooperative is a business entity formed by a group of people who share a common aspiration, and who join forces and work together to solve a common problem or take advantage of a common opportunity.
Cooperative members come from all walks of life, are of all ages, and belong to all income groups. Cooperatives are unique from other business entities in three ways: Member Ownership, Member Control, and Member Benefit.
Member Ownership
When you join a co-op, you invest some amount of money in the co-op. You become a member and an owner. As a member-owner, you’re concerned about whether the business is meeting the needs of its members. By contrast, in an investor-owned business, the owners or investors are concerned mainly with making money.
Member Control
As resident-owners of a co-op, each household casts one vote in any business decision. In an investor-owned business, in contrast, investors cast votes in direct proportion to the number of shares they own—that is, more shares equals more votes equals more control.
A co-op is led by a member-elected board of directors. The directors are member-owners who have agreed to serve the organization for a specific period of time, and are empowered by members to make decisions on behalf of members.
Member Benefits
A manufactured home park co-op’s main purpose is to provide affordable housing for its members, who are charged only for the actual cost of running the co-op. The co-op generally operates at-cost or on a not-for-profit basis.
An investor-owned park, in contrast, is in business to make money for the landlord, and not to benefit residents.
WHAT IS A MANUFACTURED HOME PARK COOPERATIVE?
A manufactured home park cooperative is a group of residents that have organized for the purpose of purchasing, owning, and operating their park. The organization takes the form of a cooperative corporation, owned by residents and run by residents for the benefit of residents.
The cooperative is a corporate entity that owns all of the land, and the residents are members of and shareholders in the cooperative corporation. Upon purchasing stock in the cooperative, you become a member-owner and sign a perpetual lease, called a proprietary lease or occupancy agreement, giving you a legal and exclusive right to occupy a specific lot in the park, on condition that all obligations to the cooperative are met. Only residents can own shares in the corporation can be members of the co-op and have control over what happens in the park.
The co-op is run just like the business venture of your current landlord, except that the co-op’s sole purpose is to maintain quality affordable housing for its residents. As the legal owner of the property, the cooperative corporation is responsible for meeting its financial obligations, including mortgage payments, property taxes, and management and maintenance costs. The cooperative passes on these costs to the member-owners, who pay a single monthly fee or “carrying charge” to the cooperative. In a cooperative, your monthly payment is used only to cover the park’s actual operating and maintenance costs, and not to make a profit for the residents or an outside investor.
HOW DO RESIDENTS BENEFIT FROM LIVING IN A CO-OP?
Lower and Stable Monthly Charges
A cooperative park operates at cost, meaning that 100% of your monthly payment goes toward operation of the park. In a traditional rental situation, some of your monthly payment goes to profit the owner. In a co-op, rents are more likely to remain stable, and increase only to cover increased costs of operating the park.
You will sign a lease with the co-op to occupy your site, and the lease is valid as long as you meet your obligations to the co-op.
No Risk of Displacement
As a resident of a manufactured home park, you live under the threat of the park being sold to another owner, or being sold for development. Because mobile homes are not really mobile, increases in monthly charges or a park closure put you in a difficult position. At best, you’re held captive to the owner’s wishes. At worst, you could lose your home.
A co-op removes the threat of displacement because you and your fellow co-op members own the land and control the monthly charges, providing stability for your family and your investment.
Improved Park Maintenance
Sometimes, park owners neglect to make needed improvements to their parks, including sewer, water, electric systems, roads, play areas, and common buildings. Quality of life in any community depends on the regular maintenance and improvement of these crucial systems. In a co-op, residents decide when and what to improve within their park.
Park owners make and enforce park rules. Unfortunately, park rules are not always fair, and the rules are not consistently enforced. In a cooperative, residents make the park rules, change the rules, and empower the board of directors to enforce the rules.
Equity Accumulation
Unlike renting, cooperative ownership offers the possibility of accumulating equity over time.