Ashland could see community currency system

If your next-door neighbor rakes your yard, you could reward him or her in Trade Dollars under a new system being developed by two local women.

Sharon Miranda and Libby VanWyhe hope to have Ashland residents and business owners using community currency to purchase goods and services and compensate people for volunteer work through their OurNexChange system.

"The whole idea is to harness the resources of our businesses, organizations and government into a system that provides sustainability," Miranda said.

This would be done through a Web-based system that would track the exchange of currency units through users' accounts. There would be no tangible money.

"The idea is it's an online complementary currency exchange program," VanWyhe said.

Miranda founded Ashland's WebSpirit Community, a social networking Web site, six years ago and has been working on the currency project for almost two years, she said. VanWyhe, WebSpirit's community assistant, began helping Miranda with OurNexChange about 10 months ago, and they're hoping to have testers start using the system by the end of the year, Miranda said. They've sought advice from experts and will have economic advisers continue to offer guidance, she said.

To participate, an individual would start out by applying for an exchange account, VanWyhe said. In the beginning, that person would have no currency but could receive some exchange units — called Trade Dollars — by taking training to understand the system or by volunteering with organizations that have accounts. An individual could also receive currency by doing some work for a neighbor or bartering possessions, VanWyhe said.

Transactions would take place through the online system, which has a built-in accounting application, searchable directory and networking abilities. Users can rate each other and provide feedback on their experience with the system, Miranda said.

"Through the online system there's a lot of transparency," VanWyhe said, adding that users will be able to see each other's transactions. "It's transparent economics."

To get the flow of currency started, organizations and businesses using the system will be granted a credit line that allows them to issue units, Miranda said.

All users can dip below zero into the negative side of their accounts, but businesses and organizations that have proven to be stable and trustworthy will have a lower cap, Miranda said.

Users will then have to bring their accounts back to the positive side by selling goods or services, she said.

"The businesses and organizations will all be expected to flow back and forth," Miranda said. "It's the flow of currency."

The system acts somewhat like a mutual credit and debit system, VanWyhe said.

"What it really means is we're banking on the stability of their trustworthiness," VanWyhe said. "They're really the issuers of the currency."

Bartering and volunteer and neighborly work — such as helping your neighbor with a chore — are not subject to taxation, VanWyhe said, although for-profit work or sales is taxable.

A fair-market-value compensation rate will be set, and a conversion factor will help translate Trade Dollars into U.S. dollars for tax purposes.

Businesses can accept a combination of Trade Dollars and real dollars by setting up PayPal in the system's Web booths, Miranda said.

"This is not intended to be a replacement of the U.S. dollar," she said.

The system is intended to enhance the current economic system, she said.

"We're working in tandem with the U.S. dollar," VanWyhe said.

The more successful the system, the less need there is for U.S. dollars, Miranda said.

"The utility of the unit goes up as the market for the unit increases," VanWyhe said.

They've tried to remove the sense that the value is in the currency, as each unit really represents a fraction of someone's time, Miranda said.

"The value is in a person's energy output," she said. "The value of our dollar can fluctuate, but the value of our time can't."

The scarcity of the dollar and the current state of the economy make the system valuable, VanWyhe said, and it also provides a promotion service as well as encouraging people to patronize local businesses.

"It increases the market for their services in a climate in which the dollar may be scarce," VanWyhe said.

Crystal Arnold, who graduated with a degree in international economics from Southern Oregon University and serves as an advisor to the project, said the region's high unemployment, low wages and high elderly population make it an excellent place for a complementary currency.

Complementary currencies "tap into unused capacity in a region (empty seats in a workshop, restaurant or movie theater) and increase the sourcing of local goods," she said. "They are designed to fulfill a different role than national currencies, and because there is no interest charged for accumulating the credits, there is no incentive for hoarding."

Ashlander Ulla Mentzel, whom Miranda has asked to be a tester for OurNexChange, said the currency will be an important addition to the current monetary system.

"A complementary currency provides an additional means of exchange in our gift-rich but cash-poor community, especially in times of recession or depression," she said.

Transaction fees will provide funding for OurNexChange, which will be run by a community cooperative, Miranda said. She plans to form a separate LLC that will maintain and improve the system's technology.

A key to the project's success will likely be the 2,800 members of WebSpirit, Miranda said.

Although WebSpirit membership is not required to join OurNexChange, those members already know and trust each other, VanWyhe said.

"The most absolute requirement for success is trust," Miranda said. "The whole backing of the currency is based on trust."

They're hoping to increase community awareness of the project and are seeking public input to gauge interest.

For more information, visit www.ournexchange.com or e-mail orient@ournexchange.com.

"We're certainly wanting the community to realize this is a community-owned operation," Miranda said. "We're developing a conscious community of choice. It requires everyone to stand up into their roles. That's a change of consciousness that I'm calling for in this community."

Kira Rubenthaler can be reached at 482-3456 ext. 225 or krubenthaler@dailytidings.com.