Editors Note: Anna is serving as an AmeriCorps VISTA (Volunteers In Service To America) at NEHDA for the year. Her roll involves a variety of tasks, such as recruiting volunteers and applying for funding opportunities to plan fun events that benefit the community. Anna graduated from Syracuse University with a BA in Spanish. She also works as a dance teacher and volunteers on the Mission of Miracles in El Salvador when she can. As part of Anna’s work with NEHDA, she is writing some posts for us to share. All of her posts can be found under the “NEHDA” category. To learn more about NEHDA, visit their website and Facebook.
Cooperative Federal is a credit union owned, operated and run by its members. Coop Fed prides itself on serving people and communities that are underserved by the conventional financial institutions, with 94% of their clientele being low-income, and 64% being credit invisible. Ron Ehrenreich serves as their treasurer and CEO, as well as being one of the founders. Read on to find out more about this wonderful local financial institution and all their contributions to the community.
Anna: How did you get involved with the Credit Union?
Ron: OK, well, going back to when I was not much older than you I was active in what we called then “The Movement,” and then as the activists settled into neighborhoods and communities around the country we were looking for ways to bring activism into our neighborhoods. A lot of people got involved with forming food co-ops, and I joined the food co-op here in 1976, and I helped to found the food co-op in Philadelphia when I was 21 but I was never involved in the food part. I helped to secure the building and get the backing for renting the building and so then what we were finding was people were doing that, that whole movement was having trouble getting capital. Nobody would lend to them.
Plus there were some other things going on at the same time, banks were leaving neighborhoods in urban areas, fleeing to the suburbs, plus they weren’t lending to people in the neighborhoods. Women were having trouble getting credit, particularly women who were single, separated, widowed, divorced, abandoned. At that time all the credit would be in the husband’s name. So, we even saw instances where the husband would die, leave the house to his wife but there was a mortgage on the house and she couldn’t get a mortgage to replace the mortgage that was in the husband’s name. It was ridiculous, plus the usual cast of characters who couldn’t get credit: people of color, people who were living on low income, the same kind of people who are shoved aside today. There was a big push to resist apartheid in South Africa, so there was a movement afoot then to divest money from South Africa and banks were being asked to divest money and nobody would–not a single bank in this area would. So we said, “well we could do that and we could address these other issues,” so we had a meeting, a meeting of activists, passed a hat, and we got $30 [laughs].
We were young and idealistic and we didn’t realize that you couldn’t start a financial institution with $30. (Now to be fair $30 then was more like $80 today, so if you had a meeting of low-income people and you passed the hat and got a few dollars here and five dollars there and you ended up with $80 it wouldn’t be so bad in terms of the purchasing power.) So we used that to organize a pledge campaign, we got pledges of a hundred thousand dollars, submitted our application to the national credit union administration, we got chartered. So I was on the organizing committee. We routinely set up a table outside the food co-op and at peace council events and wherever else we could and got these pledge cards signed, and then we tried to figure out what to do next. We had a series of meetings where we asked people what would you want us to lend for, and what would you want us not to lend for, so we ended up framing our lending policy then, and that stuff is still in place. I mean, we’ve elaborated on it and developed it since then but that really framed the basis of what we would lend for and what we would not lend for, and I think we had a vision of serving people who weren’t being served and trying to take into account the whole person not just a bit of them. We developed methodologies for evaluating people’s credit worthiness based on kind of alternative criteria that made sense, not just was easy for a banker, and we’ve done that since then, we’ve developed ways and methods of dealing fairly with people that the banks would just walk away from.
So anyway, that’s how I got involved, I was on the organizing committee, I was part of the board, and I became the second treasurer. As we got going more, the first treasurer said he couldn’t keep going with the work. I had bought the first personal computer in the area, and so I was able to do projections and an electronic spreadsheet was like the most miraculous thing. That helped me to become the treasurer and to work with the info that we had, we could only do projections quarterly because the computer didn’t have the brainpower to do it monthly. I had been trained at mainframes and card punching and all these obsolete things when I was in college. But I could not do the work that I do without a computer and I wouldn’t be any good at it if I had been born 20 years before,because I can’t do that stuff with my mind and paper. So anyway, I was on the board, became treasurer, and that’s how I got involved, and I’ve stuck it out.
A: The Credit Union’s 35th Anniversary was in October, what does that mean to you?
R: I think the most important thing for me is that we have kept faith with the vision of our members. I have tried to keep that vision ahead of us . . . My greatest fear is that somehow we would just become a nice credit union. We’re not just a nice credit union, we do what we do on a regular basis, year in and year out what others think is impossible. But, we have wonderful people who work at it and see what we achieve and fill part of it and make it happen. It doesn’t happen on its own.
A: What are some of the experiences that have most impacted you in your time working at the Credit Union?
R: In terms of the experiences, I think it’s step-by-step trying to do more, trying to achieve more, adapting technology, adapting when we didn’t have technology . . . We adopted to the technology that was available that we could afford and now we’re pretty much up to the state of the art technology for what we do and that’s great. And we had to update as we opened other offices, so this past year we’ve upgraded our entire network. Next year we’ll be replacing our core system that keeps track of all our members’ money and transactions.
And now our members have access to their accounts, obviously in the office, over the counter, but over the telephone, over their cellphones using an app, Web Teller, over the internet. They have home banking, mobile deposit capture, basically everything and we bring it to them affordably. We’ve done it differently than others. We take the costs, divide it up, try to break even, and we charge our members $3.00 a month. They don’t have to pay for any of those other services, the bill pay and anything like that. There’s a lot that goes on where we take the right road, we could have done something else but we’ve done something that’s fair and sometimes the members don’t realize (that).
I’m happy and content with the way we’ve done things. And it’s not to say there’s no room for improvement. We could always do things better. In fact, pretty much every week we figure out something we could do better. In terms of the other experiences that have impacted me, one of the most difficult was the crash. We reduced staffing by eleven people, and these people are friends, neighbors, but we had to do whatever was necessary to keep the credit union alive or else we all would be gone, everyone would be gone. That was very difficult but we did it and two thousand credit unions didn’t make it through the crash, so I’m glad that we did. It definitely hasn’t been easy since the crash with interest rates being so low. It’s always been uphill. I didn’t expect it to be uphill for 35 years, but it’s always been uphill, but particularly steep since the crash. We’re making it work and we’re doing our part and in part we’ve done more. We’ve been more mission-driven and I think that’s the right approach. During the crash we didn’t know if we were going to make it, but our idea was if we’re gonna go down, we’re gonna go down fighting. But we did make it and we were able to keep and motivate our people, our staffing by doing more, by achieving more. People that work here are not in it primarily for the money, they’re in it to change this corner of the world.
A: Over the 35 years it has been open, what positive neighborhood and community changes have you noticed as a result of the Credit Union’s community programming?
R: I think the biggest thing that we’ve done is to deploy capital into the community where we think it will do the most good. We have requests all the time from out of town landlords who want to buy something in the SU area and rent. We don’t do that, but over the last 35 years we’ve lent one hundred and thirty seven million dollars in this community. Pretty good for a $30 investment [laughs], but we’ve focused it on creating first time homebuyers, that’s the biggest chunk. We are primarily a mortgage lender, and I don’t know if we could do that in another community — the housing prices in Syracuse are very affordable, even for people on low and moderate income. So we’re able to create first-time homebuyers, which is the source of most inter-generational wealth in the United States.
We foster small business, small business startups and growth, and a type of small business that I would call self-employment. A lot of our small businesses would be better off having unionized manufacturing jobs but those jobs don’t exist, so if they have a skill, we can help them turn it into a business and be self-employed and support their families, and have the dignity of work.
Another thing that we aim for is people’s personal financial situation. We are a place of first opportunities and second chances, so we can help people get on the track or get back on the track. We do debt consolidation, help people establish credit, we have credit builder loans. We have over the last year developed an opportunity auto lending program for people who are getting jobs but don’t have transportation to get to their jobs. So we have figured out ways with some partners of mitigating some risk and making it possible for our members to get a quality, affordable vehicle and for us to mitigate and manage our risks in doing that. We have to pay attention to that.
In part, we have developed a methodology for lending to people who are under-resourced. When somebody loses their job it’s really not the best time to repossess their car and foreclose on their house. So we try to stick with our members through the hard times and we look to them to stick with us, and they do.
A: The Credit Union’s youth programs are receiving the proceeds from the Cooperative Federal 35th Anniversary Fundraiser and Gala. Are there expansions you are planning on making to these programs?
R: First of all, our priority is to sustain the programs that we have. We have received funding in the past to get these programs setup but once they’re setup there’s no funding that we’ve got. They’re an operating expense, and yet they’re important. Now we are looking at expanding youth programs, looking at the potential of running more youth financial education programs.
A: How do the In-School Savings Branches positively impact students’ financial futures in the long term?
R: Part of it is financial education, seeing them save and giving a place to cash their paycheck, we’ve even made a few loans for good purposes. We’ve done some loans for a lawn mower so someone could have a summer job, and that would earn more than enough money to pay back the lawnmower. Then the people who are actually involved in running the office in the high schools, if they do a reasonable job we offer them summer jobs here at the Credit Union. It’s a summer job at a financial institution, it’s something to put on your resume, and we write reference letters. It’s a way for a student to get a summer income and get something to help them either get a future job or get into college or whatever, and a couple students who did well at the summer job we have offered part time Saturday jobs at the Credit Union while they were at OCC.
A: What hopes do you have for the future of the Credit Union?
R: The hopes I have for the future is that the Credit Union will continue to grow, serve more people, reach a sustainable scale. We are a financial institution with just under 25 million in assets, that is teeny. At our current scale of operations, with the offices that we have we could probably break even with less angst and struggle if we were twice our size in assets. It’s always a struggle growing assets, but I would like to see us reach a sustainable size, serve more people, do more.
For example, over the last three years we have grown our business lending on an average of 36 or 37% per year. We’re geared up to do more. We’re hoping to find some more capital to lend and I hope that someday we’ll get into the fourth Syracuse high school, Corcoran. The most important thing is that we keep the faith and keep the vision — that we do what others view is impossible, that we serve the people. “Finance for the people,” that’s our motto and I think we’re trying to build a new society within the old one.
A: Around the office we have a running topic of food and our favorite restaurants so what is your favorite restaurant on the Northside?
R: New Century
A: What is your favorite thing to get there?
R: Pho Thai which is beef noodle soup.