[mintdollar]

Communities making their own currencies
Diana Felber brought her groceries to the checkout and counted out her cash -- purple, blue and green bills that are good at only businesses in western Massachusetts.

Known as "BerkShares," the colorful currency is printed by a nonprofit group to encourage people to spend close to home in the state's Berkshire region. Customers who use the money also get a built-in 10 percent discount, since they can get 100 BerkShares for just $90 at local banks.

"I like all the ideas about local," said Felber, 64, an artist shopping at the Berkshire Co-op Market. "I also like that it's a discount. Who wouldn't like that"

The BerkShares program is one of the most successful of its kind in the country, and it is attracting attention as other communities look for ways to insulate their economies from the deepening financial crisis.

Susan Witt, co-founder of the nonprofit Berkshire Inc., said her group receives about three calls a day from other people interested in creating local currencies.

So far, more than $2 million in BerkShares have circulated through 350 businesses since the bills were first printed two years ago.

BerkShares look similar to real money for good reason: They are printed on specialty paper from Crane & Co., a local company that has been the sole provider of paper for U.S. currency since 1879.

The bills come in denominations of 5, 10, 20 and 50, and feature portraits of well-known local figures: a Mohican Indian, the original inhabitants of the area; civil rights leader W.E.B. DuBois, who was born in Great Barrington; community leader Robyn Van En, who died in 1997; Herman Melville, author of Moby-Dick; and painter Norman Rockwell, who lived in Stockbridge.
http://waronyou.com/topics/communities- ... urrencies/

[Golgo13]

Wonder how long it will be before the Fed comes in and shuts them down like they did with those people making the Ron paul dollar.

[steam_cannon]

Wonder how long it will be before the Fed comes in and shuts them down like they did with those people making the Ron paul dollar.

Probably 1-3 years.

But on the other hand, if these "dollars" are exchangeable for
FRN's, they might be fine. The problem the fed had with Liberty
Dollars was that they were exchangeable for tangible metals, not
Federal Reserver Notes. The FED likes to be the only game in town,
so if these dollars are basically FRN's that you can only use in a local
area, the FED probably wouldn't care. Like if you go to a fair and
they have tickets you have to buy to use the concession stands
(saw that in AR).

post-gazette.com

The U.S. Constitution prohibits states from coining their own
currency, but it is silent on local paper money. The courts
have allowed private groups to print complementary
currency, provided it does not compete with federal money and
does not circulate beyond a limited area.



For accounting purposes, the Internal Revenue Service requires that income received in BerkShares and other local currencies be declared in U.S. dollars.



Machal Snyder, a bookkeeper for several businesses, said he stopped going to the bank to get BerkShares.

"I just started using my debit card for everything," he said. "I hate to admit it, but I think that I have become a bit more about convenience."

From all this, I take it that basically a business goes to a bank to
get these and to exchange these for federal reserve notes. Kind of
like tickets at a fair. So it's not really a local currency, it's regular
currency in disguise with special restrictions.

[s0cks]

The only attraction is the discount. The businesses still have to convert back to US$ for operating outside of the community (e.g their suppliers).

And if you live and work locally you still have to declare income of BerkShares in US$.

Does this currency even hold its own value or is it always 1BS$ = 0.90US$?

[Quinny]

Quite a few Transition Towns in the UK and NZ are developing their own LETS (Local Exchange Trading Systems).

I'm hoping to start one locally.

[bratticus]