SUBMITTED AGENDA ITEMS:

Key Bank Representative Ken Noteboom Visit
· Ken Noteboom, our banker from Key Bank, discussed our loans, our financials, what goes into calculating a business's rating factor, and how that affects the amount of interest on commercial loans.
o Specifically, (Ken) has identified a potentially key area that he thinks could contribute more money to accomplishing the co-op's goals and strengthening its financial position. If the co-op can earn money for its community outreach endeavors before spending it, it will serve these ends.
o The co-op's outreach levels are tied to sales levels rather than to gross profitability. This leaves us more susceptible to effects such the bridge outage or general economic downturn.
o The co-op may be able to concentrate on saving a portion of outreach spending, which over time, could then be used for more outreach spending. When the co-op spends rather than saves, it weakens financials and raises risk factors. Risk factors are key determinants in setting interest rates.
o By setting aside this type of savings, it will more accurately show how much profit the co-op makes during the year, and reduce risk factors.
o After a few years' savings, the co-op will have set aside enough money to fund an average outreach program. The money that will be saved on interest could then potentially allow the co-op to spend even more on outreach.
· We will continue to discuss these concepts at the March Finance Committee meeting.

Review of Dec. Financial statements and 2006 Non-Operating Expenses
· Due to the nature of our zero balance accounts, there can be fluctuations in our line of credit, in which it can look significantly lower than it actually is. The thirty-first was one of those days so our debt to equity ratio looks much better than it has in previous months, and conversely, the current ratio looks worse.
· In the past we have directly expensed kitchen inventory rather than making it an inventory asset. This one time reclass was done in December, so as a result, the cost of goods looks much better than it actually is in the month of December, while the yearly figures are correct.
· Sales in January are above budget for the month. We have not finished closing the month so we cannot analyze the margin we achieved or the bottom line.

Patronage Dividend Discussion
· Since we are likely to finish with a negative bottom line, the GM, finance manager, and finance committee do not see a possibility for issuing a dividend this year.

Meeting adjourned: 6:35pm