Commons Credit
= a project by ReCommon: "a whole-systems accounting and valuation methodology for community-held land" [1]
Description
"The Commons Credit is a whole-systems accounting and valuation methodology for community-held land. It serves two primary functions. The first is to properly value any given piece of land, including the ecosystem health, economic capacity, housing, food production, etc. The second is to create a way for ethical investors to finance the purchase of land and get a return on their investment, while keeping the ownership within a perpetual trust and stewardship within the community. The purchasers of these ‘Commons Credits’ are considered Patrons, representing 20 percent of voting power on both the global ReCommon level and on the Bioregional Node level, depending on the physical origination of the commons credit.
The Commons Credit serves as the digital record of a piece of land that is in the ReCommon network. When a piece of land enters a Bioregional Node’s stewardship, a Commons Credit is created as the digital representation of the value of that land at that moment, and is forever tethered to that piece of land. As the valuation of the property is assessed and changes over time, it is recorded and updated in the commons credit, using a smart-contract NFT such as Charged Particles. This ongoing assessment is the whole-systems valuation methodology, and as MRV (measurement, recording and verification) tools improve over time, the rate at which this assessment happens will trend towards nearly live-updates.
The Commons Credit becomes a way to finance community-centered land regeneration by serving as the fertile middle ground between a philanthropic donation and conventional real-estate investment. The Patron who purchases a commons credit for a particular piece of land doesn’t own that land, which is owned by the bioregional node’s trust, but they are included in both governance and upside in the appreciation of the value of that land.
The value of the commons credit tracks with the holistic evaluation of that piece of land, which will increase through regenerative use and sustainable development. When the land value goes up, it is reflected in the Commons Credit, and the Patron (the holder of the Commons Credit) can choose to sell it on the open market for profit.
A ‘royalty’ is attached to the sale of the Commons Credit, ensuring that whenever it changes hands and profit is made, some of this profit always returns to the Bioregional Node. This aligns previously unaligned incentives, connecting speculative profit made by exchanging Commons Credits directly to the ongoing funding regenerative projects on the ground. All of this happens within the container of a perpetual land-tenure model, which ensures that land is properly stewarded by community in perpetuity and that all stakeholders have a voice at the table.
In this way, the Commons Credit separates the right to finance and invest in real estate for speculation or impact from the right of ownership, while creating a recurring revenue stream for the Bioregional Node and ReCommon. By reserving 1/5th of the voting power for Patrons, the RegenCLT model weaves these financiers into the participatory governance of the land but ensures their say is always in balance with other stakeholders."