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An association or corporation established for the purpose of providing services on a nonprofit basis to its shareholders or members who own and control it.

The nature and functions of cooperatives differ considerably—such as purchasing cooperatives, consumer cooperatives, and marketing cooperatives.

In the context of agriculture, a farmers' cooperative refers to an organization of farmers residing in the same locale that is established for their mutual benefit in regard to the cultivation and harvest of their products, the purchase of farm equipment and supplies at the lowest possible cost, and the sale of their products at the maximum possible price.

The term cooperative also signifies the ownership of an apartment building by a nonprofit corporation that holds title to it and the property upon which it is situated. Stock in the corporation is allotted among the apartment units on the basis of their relative value or size. The right of occupancy to a particular apartment is granted to each cooperative member, who purchases the shares assigned to the desired unit. The member subsequently receives a long-term proprietary lease to that unit. The rent payable pursuant to the lease is that member's proportionate share of the expenses the corporation incurs in operating the cooperative—such as insurance, taxes, maintenance, management, and debt service. The cooperative concept evolved in New York City during the early 1900s as a mode of accommodating the public's desire for home ownership; it subsequently expanded to other large urban centers.

In order to finance the purchase or construction of the cooperative building, the cooperative places a blanket mortgage on the property, which is pledged to support the given debt. Lenders usually are hesitant to accept an individual member's stock and proprietary lease as security for a long-term loan. The members' lien (a claim on property to satisfy a debt) on the lease would be subordinate to the blanket mortgage on the property. The purchaser of a cooperative apartment usually must have sufficient cash available to pay for the stock allotted to the unit he or she wishes to obtain. The initial price of the stock generally does not exceed the amount required for a down payment on a single-family residence. As cooperative members accumulate Equity (the value of property exceeding the total debts on it) in their stock, subsequent purchasers must either have a substantial amount of cash available or locate a seller who is willing to recoup the equity in installments over several years.

Cooperative members are also financially dependent on each other. The existence of a single blanket mortgage paid by rent receipts means that if several members default in their rent payments, the corporation might not have sufficient funds to pay a mortgage loan installment. Foreclosure will ensue in regard to the entire membership unless it acts to satisfy the default. Although special reserves and assessments are generally employed to cover such a contingency, the available funds might be inadequate to prevent default.


n. an association of individual businesses, farmers, ranchers, or manufacturers with similar interests, intending to cooperate in marketing, shipping and related activities (sometimes under a single brand name) to sell their products efficiently, and then share the profits based on the production, capital or effort of each. "Sunkist" oranges is an example of a large cooperative. Cooperatives include dairy milk producers, cotton gins, and thousands of other enterprises of all sizes. There are also cooperatives in which consumers form retail outlets like grocery stores and share the profits based on the amount of patronage of each member, but they have found it difficult to compete with the giant supermarket chains.


noun alliance, association, collective, communal business establishment, communal society, commune, concurrent effort, federation, guild, joint action, joint operation, joint possession, partnership, teamwork, union
See also: ancillary, associated, beneficial, benevolent, coadunate, collective, common, concerted, concurrent, consensual, constructive, favorable, harmonious, joint, mutual, synergetic, united
References in periodicals archive ?
For consumers, that could mean joining a food co-op or credit union, buying co-op branded foods and other products, looking for a co-op preschool for your children, etc.
The most successful group of black co-ops is the Federation of Southern Cooperatives/ Land Assistance Fund, which is a "network of rural cooperatives, credit unions, and state associations of cooperatives and cooperative development centers in the southern United States," says Nembhard.
These risks may be exacerbated when owners are away, especially where condos and co-ops are purchased as seasonal residences.
Furthermore, in response to totalitarianism abroad, America re-committed itself to democracy during the 1930s and 1940s, a set of values explicitly promoted by co-op nursery schools both in their organizational structure and their progressive philosophy of early childhood education.
NOTE TO EDITORS: Past CO-OP recipients are available to discuss the benfits of the CO-OP with the media.
In today's rigid Sarbanes-Oxley climate, having co-op channel reporting you can trust is no longer a luxury, it's critical to meeting rigorous reporting requirements.
I know how busy co-op managers and directors are, but this effort does not have to be a big time-consumer.
Mindy Goldstein, NCB's senior vice president, arranged nearly $30 million in loans during September, including a $9 million first mortgage and a $3 million line of credit for a 149-unit co-op located at 136 East 56th Street in Manhattan.
The Grove attracts consumers that are on the leading-edge of fashion, shopping for the latest contemporary styles and casual luxury products, which defines the BARNEYS NEW YORK CO-OP customer.
But farmer co-ops are only one sector of the co-op economy.
8 million first mortgage and a $500,000 line of credit for the Gilsey House, a 45-unit co-op located at 1200 Broadway in Manhattan; a $3.