Local currencies are nothing new to either Ypsilanti or Ann Arbor. In addition to 19th-century municipal banks, both cities created local currencies about 80 years ago. They weren’t created to boost local spending or civic pride. Ypsilanti created her local currency, called scrip, in the fall of 1931 because the city had no other money to pay municipal employees.

Ypsilanti "Time Scrip Money" was used to pay for municipal work. (Image links to higher resolution file.)

The currency included paper pennies.

“It was really just an IOU,” recalled Paul Ungrodt, in an April 15, 1975 Ypsilanti Press article, one of a Great Depression retrospective series. “[T]here was no money; hardly anyone could afford to pay taxes, so we made do with the scrip.” In the summer of 1929, Ungrodt was proud to have secured the prestigious job of Ypsilanti Chamber of Commerce secretary. A few months later, the stock market crashed.

Ypsilanti’s slide into the Depression wasn’t immediate, but two years after the crash, conditions were grim. Little federal help was available, aside from a few shipments of federal flour and Red Cross cloth. Ypsi Boy Scouts led door-to-door clothing drives. The used clothes were taken to the city welfare office at Michigan Avenue and River Street, “renovated,” and given to the poor.

Church and social groups held canning parties and put up thousands of quarts of food, some for distribution to the poor. One September 1932 Ypsilanti Daily Press article reported that Lincoln schoolgirls in the seventh, eighth, and ninth grades canned peaches, tomatoes, and pepper relish for winter use in their own cafeteria. The girls also put up 65 quarts of concentrated grape juice, made from grapes grown by boys in the school’s “agriculture department.”

In 1931, one city council member proposed that municipal employees in the “streets and parks departments should be put on a four day shift after Oct. 1,” reported a Sept. 22 Daily Press article, “and unemployed men put to work under them in shifts to keep the work done and provide labor for those whom the city must help. These unemployed will be paid in scrip which can be used for specified groceries in any city store.”

To get the streets and parks jobs, the unemployed had to apply for an identification card. Aside from standard questions about age and address, the applicant had to provide the name and address of their previous employer, whether they were in debt on their furniture, car, or anything else, and whether they had received any other aid in the past.

The city received 400 applications. Roughly three-quarters were married men, about half were over 40, and about half were white. Fewer than half owned a home, but rented an apartment, lived in a boarding house, or rented a single room. Almost a third of applicants were the sole supporters of their family, and almost a quarter had more than two dependents. Two women applied.

The number indicated a want that was more pressing than some believed to be the case. “It should be understood,” Paul Ungrodt was quoted in an Oct. 30, 1931 Daily Press article, “that many of these unemployed who have registered, although the total is apparently great, are not hard pressed. Many have relatives and the condition of many others is not serious because they have had work until recently. Furthermore, there are numerous instances where more than one in a family registered.”

As a representative of the city’s economic health, Ungrodt may have felt a need to downplay the problem. Years later in the 1975 Press retrospective article, he characterized the times more negatively. “If your business failed either you were lucky enough to find someone else to work for or you simply did nothing,” he [said]. “But there weren’t jobs for most people. It wasn’t a pretty picture by any means.”

This 1837 currency from the Bank of Ypsilanti features cows, a sheep, and a beehive. (Image links to higher resolution file.)

In preparation for the work program, city officials decided “the city will profit more and the poor as much by a program of work which will be of permanent benefit rather than the creation of odd jobs of no lasting value,” according to an Oct. 10, 1931 Daily Press article. City officials planned a 390-foot sewer as the first project, to be followed by work whose cost in scrip and materials could be covered by bonds issued by the city. City clerk Harvey Holmes designed the scrip, and it was printed in town.

The article concluded, “‘[A]ll who expect dole from the city will be required to give work in return,’ Mayor Matthew Max has insisted.”

Later that month, “[t]he first issue of scrip money by the city of Ypsilanti was made,” said the Oct. 21, 1931 Daily Press, “when City Clerk Harvey Holmes paid seven men a total of $89.25 [$1,250 today, or an average of $180 each].

“Scrip will be accepted only for the articles printed on the back of the money,” continued the article, “and each piece must be signed by the man presenting it. If he cannot write, the merchant accepting the scrip signs for him, and his thumb print is made on the scrip. There will be no change made in either cash or scrip. Persons using it must purchase the full amount they present.

“Scrip is issued in denominations of 1 cent, 5 cents, 10 cents, 25 cents, or $1.”

The list of items scrip could buy was restricted, the article said, to “coal, coke [fuel], bread, navy beans, bacon, baking powder, corn meal, corn starch, canned soup, canned peas, canned tomatoes, canned hominy, canned corn, coffee, crackers, flour, lard, matches, milk, macaroni, oleo, oatmeal, onions, potatoes, pepper, prunes, pancake flour, rice, soap, sugar, salt, [baking] soda, salt pork, tea, and yeast.”

Fresh meat and fish, butter, eggs, cheese, and fresh fruits and vegetables were not allowed.

A year and a half later, President Franklin D. Roosevelt passed the Federal Emergency Relief Act which granted money to the poor. FERA was followed by other New Deal programs that addressed unemployment. Ypsilanti scrip was phased out.

Today, the surviving examples are only a reminder of the onetime local currency, earned with a pick and shovel, that put food on Ypsilanti tables.

Thanks to Gerry Pety and Derek Spinei for help with images. Images courtesy of Ypsilanti Archives.

Mystery Artifact

This biweekly column features a Mystery Artifact contest. You are invited to take a look at the artifact and try to deduce its function.

The previous Mystery Artifact was guessed correctly by Larry Works: a glue pot. He added, “Most likely used by woodworkers to put on hide glue in the last millennium. Had to be heated over a fire in order to soften the glue before it could be applied.” That may be – the Ypsilanti Historical Museum information for this artifact indicates that its inner chamber could be removed to add hot coals into the outer chamber.

This week’s Mystery Artifact, about two feet wide, bristles with a square of pointed metal teeth. Take your best guess and good luck!

“In the Archives” is a biweekly series written for The Ann Arbor Chronicle by Laura Bien. Her work can also be found in the Ypsilanti Citizen, the Ypsilanti Courier, and YpsiNews.com as well as the Ann Arbor Observer. She is the author of “Tales from the Ypsilanti Archives.” Bien also writes the historical blog “Dusty Diary” and may be contacted at ypsidixit@gmail.com.

Backround trio from left to right: Kathy Ciesinski with Think Local First; Andrew Cluley, who was covering the event for WEMU radio; and Bob Van Bemmelen, proponent of the Unity model. Foreground trio: Ingrid Ault, executive director of Think Local First; Samantha Nielsen Misiak and Krissa Rumsey, both facilitators for TLF. (Photos by the writer.)

On Tuesday evening at the downtown Ann Arbor District Library’s lower level multipurpose room, Think Local First held the first of three meetings designed to gauge interest and support for the idea of a local currency. Ingrid Ault, Think Local First’s executive director, said she was hoping that more than the 10 people who dropped by would attend.

But there’ll be two additional meetings with the same content, both from 6-8 p.m.: Thurs., Feb. 25 at the Ypsilanti Senior Center; and Wed., March 3 at Vitosha Guest Haus Inn.

One couple, Larry An and Eileen Ho, dropped by the Tuesday event, even though that wasn’t the reason they were visiting the library. They’d come with their fourth- and six-grade kids, who were looking for their artwork – the lower level of the library is regularly updated with exhibits of art created by students in Ann Arbor’s local schools.

What piqued An and Ho’s curiosity was the idea of adding a local currency as a tool in their cohousing development – Sunward Cohousing – to aid the distribution of the work. Currently, members of the development are supposed to work four hours a month on tasks that are determined by the development’s work committee. For example, An said he’d put in some time shoveling snow in the wake of the storm that hit Ann Arbor earlier in the week.

Larry An, who dropped by the Think Local First event on Tuesday, is pointed in the right direction by Kathy Ciesinski, who was volunteering for the nonprofit.

An’s effort at snow shoveling didn’t match another resident’s, he said, who spent the entire day shoveling – that exceeded the four-hour monthly requirement in short order. But there’s no way to store that extra labor. And as the residents of the development get older, An said, people might not be able to contribute to the kind of work they did when they were younger.

The idea of using a currency primarily as a way of banking time was one of four basic approaches to local currency presented on poster printouts at different “stations” in the multipurpose room on Tuesday night. A parade example of such an approach receiving national attention is Ithaca Hours.

Closer to home, a time-centered approach to local currency has been implemented by the Dexter Miller Community Co-op, a neighborhood cooperative on the city’s west side. [Chronicle coverage: "Another Day, Another Dex-Mil"] On payment of the membership fee and dues for the Dexter Miller community, members are issued 16 DexMills – each note is worth 15 minutes, for a total of four hours.

How you get your hands on the “money” is one way to distinguish among various approaches to local currency. A second main approach presented at Tuesday’s meeting was basically to conceive of a local currency as an alternative to ordinary U.S. federal currency. The local currency can be purchased with those federal dollars at some agreed rate of exchange. In Traverse City, Mich., Bay Bucks are an example of that approach.

Also visiting the Think Local First event on Tuesday was Stephen Ranzini, president of University Bank, who had spoken to the DDA at their October 2009 meeting about his experience with the paper currency model of local currency. From The Chronicle’s report of that meeting:

DDA board members were alerted to some existing experience with local currencies in the Ann Arbor banking community, when Stephen Ranzini addressed them during public commentary at the conclusion of the meeting. Ranzini is president of University Bank. He described how he’d begun his banking career in Newberry, Mich., near Sault Ste. Marie, and how he’d developed a local currency there. In the first year, they’d circulated around $0.5 million of local scrip, and found that it had increased local shopping. So it was an idea he thought was worth looking at.

The Traverse Area Community Currency Corporation, which issues Bay Bucks, describes on its website how most businesses that accept Bay Bucks don’t accept them for 100% of payment. The idea is to keep the Bucks in circulation and circulating –  to achieve that goal, businesses can’t accept more Bucks in payment than they can reasonably expect to spend themselves.

The idea of using local currency for only partial payment for goods and services is key to the coupon model, which was the third main approach presented at the Think Local First event. At the meeting was a proponent of the coupon, or Unity model, Bob Van Bemmelen.

Samantha Nielsen Misiak talks with Bob Van Bemmelen about the coupon model of local currency.

Van Bemmelen is a pharmacist, and he appealed to a medical model to explain part of his enthusiasm for this approach. Money is like blood, essential for getting goods and services (nutrients and oxygen) to the people who need them (cells of the body). While a newborn baby might have a few ounces of blood, he said, as the baby grows, it generates a sufficient amount of blood to deliver nourishment to the rest of the body.

One advantage of the coupon model, Van Bemmelen said, is that you can easily inject money into the system – you simply give it to people.

The fourth and final approach to local currency presented on posters was a barter system with “trade dollars” used as an accounting tool. An example of such a system is the Michigan Barter Marketplace.

Participants in the event Tuesday evening were asked to visit each station where the different currency models were explained on posters, and then fill out a sheet indicating their level of support for each approach.

The next two meetings will have the same format: Thurs., Feb. 25 at the Ypsilanti Senior Center; and Wed., March 3 at Vitosha Guest Haus Inn. More input will be eventually be solicited through an online survey, said Ault.