Frequently Asked Questions
What is local currency?
Why create a local currency?
Why use a local currency?
Where does the idea for RiverHOURS come from?
Are RiverHOURS legal?
What examples of local currency systems are in use today?
How do I get RiverHOURS?
What gives RiverHOURS value?
Who can benefit from RiverHOURS?
What about Taxes and RiverHOURS?
How do I handle accounting for RiverHOURS?
What about inflation or deflation?
Local currency is a system of trade where paper notes (scrip) can be used for formal and informal commerce within a specific geographic region. Our local currency is called RiverHOURS. Imagine a local currency just for the Gorge! Local currencies are supported by real labor, real goods and real services in our own community. One RiverHOUR is equal to ten Federal dollars ($10.00). The scrip we issue acknowledges the value of local labor and goods and highlights the time and effort invested by the seller. Imagine at least $10.00 of spending power per hour!
As Susan Witt of the E.F. Schumacher Society explains, By favoring regionally based economies, local currencies are a tool for bringing a human face and sense of place back into our economic transactions... This interweaving helps bring the community together in all its mutuality - ecological, economic, social, and cultural. Local currencies are a practical way to act locally in the face of globalization.
The first Hours-based currency system was created in 1991 in Ithaca, New York. The Ithaca Hours system now has over 2000 individual and 300 business participants. There is the equivalent of about $70,000 in circulation, and about $2 million in transactions have been generated to date. Ithaca Hours serves as a model for RiverHOURS and for the dozens of similar local currencies established over the last decade around the United States. For a list of all the local currency systems registered in America operating today, go to E.F. Schumacher Society's web site http://www.smallisbeautiful.org/.
Absolutely. RiverHOURS are just getting started, but similar currency systems thrive in over 30 communities around the United States. The printing and use of local currencies like RiverHOURS has been declared legal by the IRS, FBI, US Secret Service, Federal Reserve and the Treasury Department.
There are currently local currency systems in use in Canada, Austria, Mexico, Australia, The United Kingdom, and all of the United States of America. Some local currency systems in use today in the United States include:
In Ithaca New York, people can even pay their mortgage fees with local currency at Alternatives Federal Credit Union!
The main way to get RiverHOURS is to become a goods or service provider, and advertise in the RiverHOURS trade directory and on our web site. When you advertise in the trade directory, you will be issued four RiverHOURS, the equivalent of forty federal dollars. To become an advertiser in the GLCC trade directory click here. Other ways of getting RiverHOURS is to purchase them directly from the GLCC, or accept them in payment for your labor or goods. You could also ask your employer to consider accepting RiverHOURS by agreeing to accept RiverHOURS as a percentage of your regular pay. RiverHOURS are issued into the community by the GLCC through the process of traders advertising in the barter paper or purchasing the currency directly from the GLCC.
The same thing that gives U.S. dollars value: the faith and support of the people who use them. RiverHOURS have a much smaller geographic and economic base than dollars, but the principle is the same. The more people there are who see them as useful, the more useful they will be. The RiverHOURS focus region is a thirty-five mile radius from the center of the Hood River bridge.
As far as Uncle Sam is concerned, treat RiverHOURS like federal cash. Each RiverHOUR is assigned a clear specific conversion value. Since the federal government considers them to be a cash equivalent, you must pay taxes on Hours income just as you would for cash income.
One RiverHOUR is equal to ten Federal dollars. It is unnecessary to file any special IRS forms for your local currency activity. When you receive a RiverHOUR, ask yourself, "If this were a $10 bill, would I report it as taxable income and pay tax on it?" If the answer is "yes," then add $10 to your business income and pay tax on it. If the answer is "no," then ignore it on your tax return.
Treat RiverHOURS just as you would Federal Reserve cash. Since the government views local currencies as a cash equivalent, no special accounting procedure is needed. However, because RiverHOURS are not yet accepted for deposit at any area banks, you will need to total them separately from your U.S. currency.
The GLCC steering committee monitors the flow of RiverHOURS in the community. GLCC members will occasionally be asked their opinion concerning the amount of RiverHOURS in circulation. Based on these reports, the GLCC may alter issuing policy to keep RiverHOURS a strong stimulant to our local economy. There are many factors which determine how much money is put into circulation. Just as with federal currency, if too much money is in circulation, we will experience inflation. If there is too little money in circulation, the trading of goods and services will be stifled.
2004 Gorge Local Currency Cooperative
Columbia River Gorge, USA updated 26 Nov 04