rorybowman (rorybowman) wrote in vancouverfood,

VFC News 2008-09 September 2008

Following the depressing and contentious owner meeting of August 27, things have gone from bad to worse for the Vancouver Food Cooperative, as was screamingly evident to anyone who has taken part in the recent Food Co-Op 500 webinars.

The September 10th session was on the CDS "four cornerstones" model, with Bill Gesnner. Under this model VFC is in a worse position than it was a year ago, as the August 27 meeting clearly indicated. VFC's vision has been diluted from a modest store in a clearly defined area to a larger store in a much more ambiguous area, nearly ten times as large as the original "primary market area." Rather than site south of 39th and west of Main, they are now looking at the area south of 78th Street and west of Andresen Road, where there are already several grocery stores. The second cornerstore of talent has been severely depleted, as key volunteers have been mistreated and lied to. In addition to losing the only interim board members with business development experience, they have also lost five of nine elected board members within four months and a competent newsletter editor. Under the guidance of founders Heather Lehman and Sunrise O'Mahoney, existing systems for basic tasks such as board communication and web publishing were dismantled, as was the only available owner forum (VFC-Discussion), while recommendations and work on new systems by the technical committee were completely ignored, further eroding confidence in what remains of talent and vision. On the capital front, things are even worse. By making the vision larger and more ambiguous, VFC has created a $1.5 million project even as it abandons previous, more modest goals. VFC is spending money faster than it can raise it, has voted to let itself spend owner equity for development, while utterly failing in the previously-stated goal of 600 owners by the end of 2008 and 1000 to open by the end of 2009. Not only will VFC fail to meet its lower goal of 300 owners by the end of 2008, but they are actually *losing* owners and do not have the cash on hand to provide full refunds to those who have purchased a share. Given their noncompliance with state securities law, this places them in a very bad capital situation indeed.

The September 17th session by Stuart Reid on "skills and Tools for the organizing stage " was equally depressing, as those familiar with VFC's progress will recognize. On clear issues of organization, transparency, honesty and accountability, VFC has failed mightily in 2008, in ways that shall become apparent. The Moxie Village debacle is a terrific case in point. Interim president Sunrise O'Mahoney entered into private and unauthorized negotiations which could have moved the store location from west Vancouver to west Camas, nearly thirteen miles away, hiding this fact from other board members for fear it would hurt her faction in upcoming elections. Instead, this duplicity disgusted key board members and alienated key volunteers, completely destroying trust within the organization. When owners called for a special meeting to address this, the board moved to avoid a minimize such a meeting, even going so far as to accuse a petitioner of criminal activity for legally announcing it. VFC is now a "low-trust" organization, with very great credibility problems, which are about to be become legal ones.

The September 24 session shall be on legal issues facing cooperatives, and VFC has several of these in play, the most serious of which is its violation of state securities law. As I've explained elsewhere, VFC had written its share subscription agreement in a particular way and has performed a variety of legal steps out of order. Concerned about this and convinced that Sunrise O'Mahoney would not come into compliance with state law so long as I was on the board, I resigned from the board in February, 2008. My hope was to spur the interim board to prompt action, but from ignorance or arrogance they have not done so. Beginning in June of 2007, VFC has accepted money for shares it was legally not entitled to issue under its own articles of incorporation, although it filed for a securities exemption with the Washington Department of Financial Institutions to do so. Even after I drove to Olympia to ensure that the articles were revised, VFC has refused to accept share agreements or issue shares. They even went so far as to pass bylaws which they assert give them the right NOT to refund shares in accordance with state law, and I think I can predict how *that* will turn out.

I am very sad to see that the promise of the VFC is dead. I just hope that the rank incompetence and idiocy of a few does not destroy the hopes and opportunity of many.
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