[permaculture] Green investments

Vint Lawrence vlawrence at nets.com
Tue Oct 18 14:45:55 EDT 2005

Back in Mid June,

Lawrence F. London, Jr. wrote:

> Can anyone describe what opportunities exist in the realm of Green 
> investments and what role the Permaculture Credit Union is playing in 
> that arena?
It is a great question and it has taken a while to put together a reply. 
For those of you who haven't become members of the PCU, here is the lead 
article I wrote for the most recent member newsletter

A few months ago, Larry London asked, “Can anyone describe what 
opportunities exist in the realm of “Green” investments and what role 
the Permaculture Credit Union (PCU) is playing in that arena?”
First and foremost, we are a credit union and that is dissimilar from 
any normal form of “green” investment. Beginning with the premise that 
ecologically aware and enlightened people want their resources to 
support growth and healing of the planet rather than exploitation and 
destruction of Earth’s ecosystems, we provide loans and financial 
services for people and projects that are consistent with the ethics of 
permaculture – “Care of the Earth, Care for people, Recycling surplus/no 
waste”. We are chartered to operate by these ethics and we are chartered 
specifically to serve a membership that can subscribe to these values. 
We are a non-profit institution (501-c-14) that returns our “profit” to 
the membership as dividends and interest payments to depositors and 
reduced rates to borrowers on loans for “earth-friendly” projects and 
products. We exist as a financial institution to serve the permaculture 
community and our values, policies, and “assets” are generated by that 
same community. We were formed so as to pool the financial resources of 
this community and make them available to serve the needs of members as 
well as to help generate an economic model that expresses the shared 
values of permaculture .
Unlike banks and investment funds that are owned, controlled and funded 
by private capital investment, we are owned and democratically 
controlled by our members, and our operations are audited, regulated, 
and reviewed by the NCUA and NMFID who provide us with the charter to 
operate and insurance on our members’ accounts up to $100,000. Very few, 
if any, “ green investments” are so regulated, governed, or insured. For 
all of these reasons, we are unique in the field. Our assets come from 
the community and are returned to serve and benefit the community.
The funds we have used to finance the start-up phase of the PCU have 
been raised as donations from private individuals and non-profit 
foundations. These funds amount to over $200,000 that have been raised 
over a period of seven years and demonstrate the degree to which each of 
our donors, both large and small, have shared the vision of people 
regaining control over how their financial resources are used in the 
world and the purposes to which they are applied.
What shade of “Green”?
All of this is admirable as rhetoric, but the most important proof is in 
the numbers and what the money in the PCU is actually doing. So, lets do 
the numbers as of July 2005.
Since the inception of our loan programs in 2001, the PCU has made 252 
loans representing over $3.6 million in funds. Of this total, 101 loans 
(or 40%) have qualified for the sustainability discount. The dollar 
amount of these loans is $2.39 million or 65.4% of actual monies loaned. 
A “snapshot” of the current loan portfolio taken in July of this year 
reveals some even more startling figures. The portfolio of 142 loans, 
representing $2.037 million, has 74 loans (52%) that qualified for the 
sustainability discount. These loans total almost $1.68 million or over 
82% of the actual dollars that are currently loaned out to members. Of 
this amount, almost $1.2 million is allocated to 28 mortgages. 27 of 
which (97.5%) are for sustainable dwellings and projects that range from 
water catchment and energy efficiency improvements to strawbale houses, 
yurts, off-grid electricity generation and solar systems.
Other loans that are somewhat unique include three loans for biodiesel 
vehicle conversions, three for greenhouse construction, two for 
permaculture landscaping, and seven for various types of other 
ecological home improvements.
There are 62 auto loans in the current portfolio of which 37 (60%) 
qualified for a fuel-efficiency discount. The actual dollar value of 
these loans, $472,750, is over 70% of the monies loaned for and secured 
by vehicles.
Surplus (non-loaned) cash represents 31 % of the total assets of the 
PCU. These funds are placed in short-term accounts and CD’s with other 
credit unions. 21% of these funds are placed in local credit unions, 34% 
is placed with other progressive, ethical, “socially conscious” credit 
unions and banks, and the remainder is in a “corporate” credit union 
(similar to a clearing house) to cover and facilitate funds transfers, 
interstate loan financing, and ACH transactions.
Perhaps the most amazing factor in our operation is that while we have 
loaned out a total of over $3.6 million in four years, our default rate 
(the percentage of loans that are not paid back or are chronically 
delinquent) is an astoundingly low 0.18%. In real terms, this reflects 
the fact that no borrower of PCU funds has failed to pay back their loan 
and only one person out of the 252 who have borrowed money has been 
delinquent for over 12 months. When compared to the national average of 
2.56% (a fourteenfold difference), this clearly demonstrates the 
integrity of our field of membership and the extraordinary commitment we 
all have to creating an ethical permaculture economy.

Several final thoughts....
The delinquency rate figures also reflect the commitment of the PCU to 
the second PC ethic - respect for people- we work with members who have 
difficulty with their loan schedule to make it work for them. We have 
not yet had to write off a single loan.
We are currently at a "break-even" point for our current operations. 
However, there is so much more we want to do and we certainly can use 
donations from individuals and foundation sources to continue to grow 
and develop. Contributions can be sent to PAL c/o Permaculture Credit 
Union, P.O. Box 29300, Santa Fe, NM, 87507-9300. We also have a 
toll-free phone # 1-866-954-3479 and a website @ www.pcuonline.org

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