berkshares, ithaca hours, and what might be possible in ypsilanti

The national press is giving some coverage to the subject of local currency again, and it’s got some Ypsilantians buzzing. I’ve heard from three people about it in the last two hours. One of the notes came from a reader named David, who had an interesting spin on it. If I understood him correctly, he was saying that having one’s own currency was the first step toward throwing off the shackles of serfdom. Or at least that was my interpretation… Actually, why don’t I just print what he said and you can decide? Here’s the pertinent part of his note:

…Considering that Colonial Scrip pissed off the Brits and was historically significant in terms of an impetus for the American Revolution, maybe introducing such would lead to the Huron River Scrip Revolt. Local money to buy local goods from local merchants – what a concept. McCoy, Tucker, and Iggy on the bills!

I don’t know that I’d go so far as to suggest that we do it as a first step toward secession, but I do think it’s worth considering for other reasons. Here are a few clips from the Reuters article on Massachusetts BerkShares that I think get at some of those reasons:

A walk down Main Street in this New England town calls to mind the pictures of Norman Rockwell, who lived nearby and chronicled small-town American life in the mid-20th Century.

So it is fitting that the artist’s face adorns the 50 BerkShares note, one of five denominations in a currency adopted by towns in western Massachusetts to support locally owned businesses over national chains.

“I just love the feel of using a local currency,” said Trice Atchison, 43, a teacher who used BerkShares to buy a snack at a cafe in Great Barrington, a town of about 7,400 people. “It keeps the profit within the community.”

…There are about 844,000 BerkShares in circulation, worth $759,600 at the fixed exchange rate of 1 BerkShare to 90 U.S. cents, according to program organizers. The paper scrip is available in denominations of one, five, 10, 20 and 50.

…In their 10 months of circulation, they’ve become a regular feature of the local economy. Businesses that accept BerkShares treat them interchangeably with dollars: a $1 cup of coffee sells for 1 BerkShare, a 10 percent discount for people paying in BerkShares.

…U.S. law prevents states from issuing their own currency but allows private groups to print paper scrip, though not coins, said Lewis Solomon, a professor of law at George Washington University, who studies local currencies.

“As long as you don’t turn out quarters and you don’t turn out something that looks like the U.S. dollar, it’s legal,” Solomon said.

…Meanwhile, Berkshire Hills Bancorp Inc., a western Massachusetts bank that exchanges BerkShares for dollars, is considering BerkShares-denominated checks and debit cards…

As far as I know, the Ithaca Hours program, which started in 1991, was the first modern experiment with non-federal currency that really seemed to take root and thrive. Since then, there have been several others, the most recent of which is this BerkShares initiative. All of the programs are a bit different, but they all, from what I can tell, have the same goal in mind — to keep their dollars circulating in the local community, instead of being sucked out, into the corporate bank accounts of national chains. The thought being that locally spent dollars spread prosperity more broadly.

Here’s an example. If I buy a cup of coffee at Starbucks, some small percentage goes to the employees working there, who live in my community, but, by far, the larger percentage goes back to the company’s corporate headquarters. If, however, I spent that same dollar at a local coffee shop, it might in turn be given to a local dairy in exchange for milk, and the owner of that dairy might then use it to pay an employee, who might then turn around and use it at the local brewery. You get the picture. Everyone does better, and the community grows more stable. The main point, at least as I see it, is that locally minted currency, by being visually different, demands that people think about such things. And, if there’s an economic incentive to using it, as there is in the BerkShares model, then all the better.

So, what’s stopping us? Surely there’s an economist at one of our local universities that would help us hammer out the details, and I’m sure there’s a banker somewhere who would get onboard. I’ve never talked with Lisa at Think Local First about this specifically, but I can’t imagine that she wouldn’t like it. And I’ve exchanged notes with the folks at Sustainable Ypsi about it, so I know they’d be up for it. It seems, at the very least, we should all sit down in a room together and hash out the pros and cons? Ypsi needs something. Maybe this is it.

And, while we’re at it, why not also be the first ad free city in the U.S.?

[Folks interested in the subject of local currency might also want to check out the E.F. Schumacher Society. They’re the ones responsible for getting the Ithaca Hours off the ground.]

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  1. mark
    Posted June 20, 2007 at 10:56 pm | Permalink

    My big concern would be counterfeiting, but I imagine that there are precautions that can be taken. Most of the technologies that countries use to protect their currency are probably availlable to everyone, right?

  2. BVos
    Posted June 20, 2007 at 10:57 pm | Permalink


    Sustainable Ypsi is already working on this:

  3. mark
    Posted June 20, 2007 at 11:01 pm | Permalink

    Thanks for the link, Brian. I went to their website and scrolled through a few pages, but couldn’t find anything. I knew they were interested in the subject though.

  4. Ol' E Cross
    Posted June 20, 2007 at 11:22 pm | Permalink

    As Ithaca is the one city in the U.S., that, in theory, could lure me away from Ypsi, I’ve been jealous of their dollars for some time.

    So I’ve been minting my own series of Ypsi dollars for some time, each contains a special sample of my DNA, to prevent counterfeiting. (Mark, you are on the two-dollar bill!)

    In support of the cause, I will go now and bottle more of my soon-to-be patented anti-counterfeiting secretions.

  5. egpenet
    Posted June 20, 2007 at 11:36 pm | Permalink

    You can achieve all of these benefits by shopping locally. Food Cop-op & Bakery, Corner Brewery, VGkids, Terry’s Bakery, Hair Weaving salons … Haab’s … it all stays local for the4 most part. Avoid the chains: Kroger’s, KFC, etc. Even the Dairy Queen is mostly local kids and is locally owned. The BP is abiout 20% local. Have breakfast at the Wolverine. Check out Biggie’s on N. Washington. The VU supports a few local employees but most of the ladies are out of townwers and the money goes who knows where. Enjioy the Tap Room/Annex. Check out Fast Eddie’s. And on.
    Spend local and it stays here. Check out the downtown Farmer’s Market. Friday music on N. Washington. You don’t neewd special script … just bring your butt there and dance it off. As I always say, “Your buck stops here … in Ypsilanti.”

  6. Robert
    Posted June 21, 2007 at 8:03 am | Permalink

    I’m guessing it’s more an expression of community pride than a practical thing. I think it’s worth doing.

  7. Posted June 21, 2007 at 9:24 am | Permalink

    Yes, we’ve been working on the local currency kind of under the radar, I guess, since last August. I’ve met with the mayor about it and talked to a few local merchants, and both Paul Schreiber and Rene Greff have agreed to sign a run of the currency. Mark, would you consider signing a run of the currency? We have had a lot of ideas about preventing counterfeiting (including a holographic seal on each bill). Ithaca does things like make the paper out of local bullrushes, etc., making it very distinctive and not easy to duplicate.

    We are currently running an Art Contest [] to design the bucks! We did a poll over the winter on our blog to name the currency and there was a tie between Tower Hours & Y-Notes — I like Tower Hours better, so that’s what got picked!

    I’m meeting next week to discuss the idea with the DDA further. I’m so glad to see this on MM because I think Ypsilanti is the PERFECT location to reap all the benefits of a local currency — activist, artistic, iconoclastic, smart, driven. We can do it!

  8. Posted June 21, 2007 at 9:39 am | Permalink

    BTW, Sustainable Ypsilanti is meeting tonight, 7:30 at Bombadill’s cafe (217 W Michigan Ave) — anyone who is interested in working on or just discussing the local currency definitely is invited to stop by.

  9. dr. teddy glass
    Posted June 21, 2007 at 10:34 am | Permalink

    I wonder how this might impact prostitution?

  10. BVos
    Posted June 21, 2007 at 1:34 pm | Permalink


    Only in Ypsi!

  11. Posted June 21, 2007 at 2:23 pm | Permalink

    There’s already a local currency project in Michigan, called Bay Bucks [] in the Traverse City area — that’s where the idea first came from for me.

    The idea is to keep the bucks circulating so… I guess… as long as prostitutes keep spending the local bucks in Ypsilanti, the goal is achieved. However, it does add a certain je ne said quoi to the entire concept of Tower… Hours…

  12. Mike
    Posted June 21, 2007 at 2:40 pm | Permalink


    I think most of the people who would use this would already be shopping at locally owned businesses, but this helps to take it a step further. I can shop at a local business, and know that the direct profits of what I have spent will stay in town. However, I cannot know that the products and services bought by the merchant are local. For example, a restaurant being paid only in US currency can purchase every bit of food from GFS or SYSCO, but if I am paying in a local currency, I know that my dollar will stay in Ypsi even further as they buy that food from a local provider. This goes beyond just shops and bars, though. There’s only so much food, supplies, beer, etc, that a merchant needs to buy. To make this really effective, we also need to have accountants, lawyers, and other business services pledge to accept local currency as payment.

    Personally, I really like the idea, if only for starting the shop local conversation every time someone says, “what the hell is that?”

  13. Posted June 21, 2007 at 7:34 pm | Permalink

    Somewhere around here, I’ve got some of what was the local currency for Lawrence, Kansas, a few years ago. A lot of people got really into it at the beginning, but I think it kind of fizzled out after some of the main architects left town.

  14. Mike
    Posted June 21, 2007 at 8:45 pm | Permalink

    At the job I quit a few months ago, I was working with a girl who had gone to college in Ithaca. When this first came up, I asked her what she knew about Ithaca Hours. She was confused at first, but after I explained, she said,

    “Oh, that. I don’t know. I know the townies and dirty hippies got into it.”

    I’m happy to be included in either of those.

  15. mark
    Posted June 21, 2007 at 8:48 pm | Permalink

    My inclination is to say that, in order to really make it work, Ann Arbor would have to be onboard. As an “Ypsi first” kind of guy, it irks me a bit to say that, but I think if you really want for something like this to prosper, you need their shops, service providers and consumers. The Ann Arbor Co-op, Downtown Home and Garden, the folks at the Farmers Market, Arbor Brewing, Zingermans, the Michigan Theater, the AATA, the Hands On Museum, the golf courses, the attorneys, the accountants, etc. I’d hate for this to start too small and fizzle. Anyway, that’s my two cents.

    I also have an idea for a name, if anyone’s interested. I’d call them “YpsiAnns” in memory of the old streetcar line that ran between our fine cities.

    And sorry I missed the Sustainable Ypsi meeting this evening. I was teaching DJ Clementine how to play records.

  16. mark
    Posted June 21, 2007 at 9:30 pm | Permalink

    And Eric B, can you tell Rakim we said hello?

  17. Posted June 22, 2007 at 9:52 am | Permalink

    Mark, I was thinking the same thing about having to get together with Ann Arbor businesses as well. I was afraid to say it though, because I didn’t want to seem like one of those Arbor-centric types.

    As far as names for the notes go, I think people are always partial to the monosyllabic. I was going to suggest ‘YIPS’ for a Ypsi-only currency. But I didn’t, again, out of fear. It sounds too much like a derogatory term or something.

    With Ann Arbor on board, ‘Yarbs’ might work, but people might associate that term with ‘yarbles’ from A Clockwork Orange. Hey, I like it!

  18. Posted June 22, 2007 at 10:00 am | Permalink

    Yes, periodically people ask Think Local First about community currency. I think the idea is great, and we’re just getting to the size where we might be able to spend some resources doing something like that somewhat soon.

    However, I’ve seen very few communities where they’ve had a really big effect, and many communities where they are pretty marginal (I think Berkshares are going to work really well because they tie into local banks).

    What I have my eye on is an emerging idea that has some of the same effects of keeping money at locally-owned businesses, called a ‘locals care card’. It is basically a card that rewards you for shopping at locally-owned independent merchants (and can also be a credit or debit card if you find a sponsoring bank, or a gift card). It gives a percentage of your purchases back to you, and a percentage back to local nonprofits. They are piloting it in Sante Fe – see for more information. I’d love to hear people’s feedback about this idea.

  19. Posted June 22, 2007 at 10:07 am | Permalink

    Actually, now that I think about it, the locals-care card could be used WITH a local currency. For a $10 purchase, you give a participating owner $5 in local currency, $5 in regular money, and you swipe your rewards card so that the $10 gets credited to your account.

  20. dr. teddy glass
    Posted June 22, 2007 at 10:13 am | Permalink

    I agree that a card might be the way to go, although I think there probably is some value to seeing the actual bills float through a local ecosystem.

    There’s a new person at EMU (perhaps in marketing) that is said to be working on a local purchasing card kind of thing for students. You might want to touch base with him, Lisa.

  21. Posted June 22, 2007 at 11:30 am | Permalink

    “And Eric B, can you tell Rakim we said hello?”

    Sure thing. Never met the guy, but if I do, I’ll extend your greetings and give him your URL.

  22. Posted June 22, 2007 at 12:06 pm | Permalink

    A couple of points: I don’t think that Ann Arbor needs to be involved. This has been a successful program for 15 years in Ithaca, with a population of 29,000, a very similar size to Ypsilanti. Also, this is not a program just for merchants. It’s a program that emphasizes employing one another and giving a high value for services from individuals as well as merchants. So, for example, if you were a person offering bookkeeping or snow removal, etc., you could sign up as an individual. Then when you sign up, you receive a few bills as a reward — thus controlling both how much currency circulates (not flooding the economy with bills one can’t spend) and bringing more people into participation. An important goal is getting LOTS of participation.

    Of course, ALL these fine points are to be decided, so there’s no reason why Ann Arbor should not be included. I just don’t think they would have to to be successful.

    When I met with Paul Schreiber about the local currency, he mentioned the new person at EMU who is working on a local purchasing card. Apparently, he formerly worked at Wayne State and promoted a successful card program there. However, this kind of idea excludes individuals offering services — here in Ypsi, we have so many original entrepreneurs and artists; another reason why it seems uniquely suited to us.

  23. Ol' E Cross
    Posted June 22, 2007 at 12:41 pm | Permalink


    Again, I like it, but one thing we have to evaluate in the Ithaca comparison is we’re surrounded by urbansprawls and they’re surrounded by waterfalls. Ithaca is similiar in size but much more much diverse in retail/economic hubness.

    Just think the plan for YpsiBuckies should consider our metropolitanacity.

  24. Murph
    Posted June 22, 2007 at 12:47 pm | Permalink

    The Eastern deal is the Eagle Discount Program, championed by Ted Coutilish, the new “associate vice president for university marketing and communications”. As Lisele notes, it’s a formal business thing, and is targeted at getting students/staff/alumni to spend more of their time/money at local businesses rather than elsewhere. (Their press release claims 100,000 alumni in SE Michigan – if the program inspires even a fraction of them to make just one more trip to Ypsi, it’ll be a wild success.) They seem to be off to a good start, with everything from pizza to “$400 off closing costs” signed up.

    As Lisele notes, though, I think an important part of local currencies is in recognizing the value of personal skills, and tying value to human time, rather than to past access to expensive higher education. (In theory, I think, you pay the babysitter or the kid who mows your lawn or the neighbor who helps fix your car with one Y-Note/YpsiAnn/Tower Hour per hour of work, even if you might pay them more or less than $10 in American currency for the same work.)

    As long as there’s critical mass, I think it could work for just Ypsi. It would probably be easier to reach critical mass if the total available population was increased to include Ann Arborites, but with enough marketing/recruitment effort, it might not be necessary.

  25. Citizen Blogger
    Posted June 22, 2007 at 9:33 pm | Permalink

    Will anybody ever be able to say “I paid the babysitter in Tower
    Hours” with a straight face?

  26. Ol' E Cross
    Posted June 23, 2007 at 10:05 pm | Permalink

    No, but I’d like to give the babysitter a few Ypsibuckies, if you get my drift…

  27. Robert
    Posted June 24, 2007 at 10:17 am | Permalink

    Why stop at paper money? Let’s go back….way back…back before the days of paper script…back before the coin even. Why not use stones with designs chiseled into them? We could make them a little classier than just rocks though. We could design a set of polished spherical stones of various sizes, representing the different denominations. This is where my idea to call them ‘yarbles’ would make even more sense.

  28. Posted March 31, 2009 at 9:50 pm | Permalink

    For those who haven’t seen it, the Detroit News had a piece on Monday about a new local currency being tried in the city. It’s called the Detroit Cheers.

  29. Steph
    Posted April 2, 2009 at 11:19 am | Permalink

    The new World Currency has been leaked.

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