Meeting Notes 2018 02 06

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These are the notes from the The 9,999th Meeting of Noisebridge. Date: 6 Feb 2018 Note-taker: @mister_name; Moderators: John Shutt

   Matt, recent transplant to SF, from Crashspace in LA
   Adele, transplant from NY, NYC Resistor member
   Jared, transplant from Vancouver, DCtrl
   Neal, rebel, first time to be here
   Aimi, been here a few times, here for the meeting
   Dany, been around for awhile, book scanner stuff
   Rabble, from Portland, CtrlH
   Mark, does game dev at NB on Tuesdays, game archiving (occasional Friday)
   Jarrod, does woodworking at NB when they can
   Jeremy, been coming around for a few months, likes to build contraptions, program things
   Alan, from Borderland Books, interest
   Kevin, coming to Noisebridge for about a year, likes working with electronics and gadgets and teaches the Arduino hacking class on 2nd and 4th Mondays of the month
   Patrick, works on computer security stuff by day, NB stuff by night
   X, brought free pizza!  Hot, exquisite, tasty pizza at 444 Townsend. OpenLate by OpenDNS, every other Wednesday. Likes microPython, esp8266 etc. 
    One or two bullet points of high-level meeting summary.

Meeting Summary FIXME FILL OUT AT END OF MEETING AND SEND TO MAILING LIST TLDR what happened at the meeting:

    Announcements:
   Feb 28th @ 7-10pm: Doctor Enigma will be coming to NB, with a fully-functioning Enigma machine (the German encryption device, made famous in Cryptonomical by Neal Stephenson). Hands-on demonstration. Will be a fund-raiser, to cover speaker fees, and looking for people to offer matching donations.
   5MOF next Thursday, Feb 13th (via X)
   There's a new coworking space by OAK airport, CircuitLaunch. Memberships starting at $100/mo. They have a PCB printer. Noisebridge fundraising event will be held there in the next couple of space. Corporate-ish, but very maker community and supportive.
   Mark, Jarrod, Jeremy are planning to build a classic arcade games console. See Slack channel #nbgamingarchivists
   Maker Faire is coming up May 18-20th, 2018. We have submitted an application. We're gonna need people to come together and help with projects. Please consider being part of the team. More info to come, on a wiki page.
   Power Racing Series (PRS): will be at Maker Faire, X suggests NB put in an entry. It's Barbie-type kids electric cars driven by adults. Also there will be an autonomous car racing series.


    Finances:
   Mini-financial report: $95K in the bank, after paying end-of-year expenses and rent. Good chance of breaking $100K during Feb. NoiseTor has about $20K of the bank balance allocated (bandwidth). They run two exit nodes, plus a bridge. NB acts as a 501(c)3 umbrella for NoiseTor. We also have an equipment fund, which will pay for half the cost of a piece of equipment.  About $5K remaining in the fund (started at $15K). Broadcast fund (over $1K): equipment for A/V, projectors, mics, etc. Qualified equipment can be paid 50% from Broadcast Fund & 50% from Equipment Fund.
   How does Noisebridge get money? (Aimi) We get cash donations, donate.noisebridge.net, Patreon, regular donations from philanthropists and members.
   Noisebridge is a place you can edit like a wiki.  You can work on it by yourself, or with others.  Be excellent to each other. NB is a Do-ocratic space, which essentially means we're all empowered to make changes to the space, make it better.  It's an anarchist do-ocratic space, meaning you don't have to ask permission to customize NB to fit your needs. Being excellent to each other means asking if you plan on making a big change.
   Noisebridge is a Safe Space: is a place where we all come together to work on stuff, together or individually. Any kind of behavior that's harassing others, that's objectifying other people, anything that makes NB not a safe space for others to come work on stuff is NOT EXCELLENT. If you feel anyone is being unexcellent, you can ask them to leave. If you want, you can ask for help. If someone asks you to leave, you should leave. Come back later when things have cooled off, mellowed, and you can address the issue. For example: if somebody is messed up on substances, passed out on the couch, they can't be here in the space. If someone is openly harassing someone that's not okay. If someone's giving too much unwanted attention that's not okay, it can be distracting. If someone is secretly living in the walls, under or over the elevators, that's not cool. Causes us trouble with the landlord, which has affected their perception of us and perhaps whether we can continue renting the space from them. If you're asked to leave, and don't, that's a big red flag. Fighting, stealing from the space, doign bad stuff.
    Participation:
   IF you're new to the space, and found that you had to be buzzed in from the ground floor, that's how you start. You can also get an RFID token with which you may enter the space during business hours, 11am-10pm. Once you've come around for a bit, you can also join as a Philanthropist, which gives you 24/7 access, and costs $80 (lower price available for hungry hackers; requires one member to sponsor). The next level is Member, with the same benefits and cost, but confers the ability to be involved in consensus decisionmaking (requires two members to sponsor). None of these positions grant anybody authority over anybody else in the space. We all have equal authority, responsibility in the space to maintain NB and to be excellent to each other. You do not have to become a member or philanthropist to hold events in the space, or to raise issues during meetings, or to comment on consensus items. All of these are possible even if you are new to NB.
    Consensus Items: 
   Consensus is for items that affect the entire space. Requires at least two meetings for a consensus item to be presented at, so that people have time to review and decide. Many things at NB were built that did not require consensus; it's a rare thing and is really for things that affect everybody, e.g. changing to a new location, which we might have to do this August (2018). Talking about Big "C" consensus; whereas little consensus is getting buy-in from people who would be affected or annoyed by your action.
   Small C consensus example: (Alex) If someone said "let's move the couches over there" it's okay, but they might not stay there for very long, and someone else might move them back. Sometimes it's helpful, to increase the acceptance and permanence of a change, is to ask others who will be affected. Painting over a mural, for example. But painting a new mural over a blank space would be cool.
   No consensus items for this week, though a consensus item is currently being redrafted (see Discussion Items).
    Discussion Items:
   There is a big-C consensus item around finances for purchasing a building. To do that, we would need to raise a ton of money.
   Eric Miller: 2018 Musicians and DIY Electronics Swap Meet. In the east bay @ Omni Commons. Sunday, 18 February 2018, 11AM-3PM (opens at 10AM for seller loading). 4799 Shattuck Ave, Oakland. Free to shop, $20 per table. http://www.eutronics.us/swap
   Ryan proposes that Noisebridge set up a table at the swap meet. Eric suggests that we use it to fundraise.
   John S: we need volunteers to review documents once we get into leases or purchasing contracts.
   X proposes that business hours be changed: 10am to 11pm (currently 11am to 10pm)
   Alan from Borderland Books will be speaking about his experiences raising $2 million for their shop. Instead of being displaced from the City, they now own a building and have a permanent foothold in San Francisco.
   Almost closed because of the minimum wage increase in SF. Started a sponsorship program to cover the wage gap.
   Their old lease was running out, and so the problem to address was to purchase the building. Spent 1.5 years looking at places. Found a record shop, heard about through the Internet Archive via his parter who works there, started talking to the building owner about purchasing the place in September, signed contract in October, got into the bldg in November.
   Raised $2 million in loans by people he knew in the business. 43 lenders (one more than they wanted!) Raised $100K from the 43.
   $2.27 million: purchase price for the building. 
   Different zoning/use for their building, but we're probably looking at $3-4 million. He ran into problem of pricing predicated on tearing down purchased building and replacing with condo developments. City protections for "PDR" spaces make those more protected against residential use, so we should focus on them.
   He just asked people to help. There was a deposit of 3% which would've been lost if they exited the contract without fulfilling. It was right down to the wire whether they would raise the money or not.
   Being direct with people, what they needed, why they needed it. Having 28 years of positive reputation helped much. NB has a reputation and people that believe in us, and will allow us to raise the money. Be really clear and direct with people. Try really hard, talk with everybody.
   Some people said "I'd love to lend you money, but for high interest rate." He had to turn those down, still friends. The math didn't support making high interest payments. This was all done on a basis of trust.
   Question (John S): Did Alan talk to lenders before going into contract? Given the terms of the contract, there's no risk -up to a certain point in time. Once you cross that date, you lose the deposit. Be careful about people who have promised money but haven't delivered. He had previously been ready to make an offer on a building, spoke to sponsors of the store, and realized if he had gotten into contract he'd have to run around fast to raise the money. He sent an email asking which people would make a loan of $50K on 7-days notice. "I'm trying to borrow $X, and I already have $Y" and this gave credibility when others were approached, having the $400K pledged.
   Question (Alex): Did people make a deposit on their pledged amount, or did they just make the full amount? Alan: he just counted on money in the bank.
   Question (Rabble): What's the terms of the loan? Alan: a simple promissory note. The interest is due annually, on the amount borrowed, the principle is due after nine years, and the entire principle is due. If they paid a loan off early, prorated interest, no penalty.
   The building is owned by an LLC. The bookshop pays rent to the LLC. There's also apartments in the building. They are actively not evicting the tenants, and not jacking up their rent.
   Reasons for the LLC: legal & financial liability. The Valentine Smith Corp owns Borderlands, which Alan owns. He also owns the LLC. Liability separation is to protect the entire arrangement, in case of accidents and stuff and the like. Keeps the building and the bookstore separate. Also protects the people who lent money. 
   Question (John S): How hard is it to set up a LLC that owns a building?  Cost $7K, and about 32 hours work, that's expedited. An S-Corp might be the way we need to go. When a nonprofit owns a for-profit it creates a messy set of books, but the govt likes because taxes.
   The company names come from Robert A. Heinlein novels (Valentine Smith from Stranger in a Strange Land, and DD Harriman from The Man Who Sold The Moon).
   Question (Jared): Could you have a nonprofit that ??? A nonprofit that owns a building doesn't have to pay property tax on it.  But the building would have to be owned by a nonprofit.  
   Question (Lizzie): A big constraint with NB is that we want community control over the things we do, so we may not trust one person to own a building, instead a group. 
   (Ryan) A financier of the NPO could own the building, instead of NB owning the building?
   What about the Women's Building and Omni Commins? How are they doing it? We should meet with them.
   Alan: It's good to think for the future, but the real problem is getting the money and finding the building. Noisebridge as a community needs to retain control of the building and its direction, but the building needs separate ownership for liability purposes.
   Alex: Worst-case, if NB were destroyed by a lawsuit, total strangers could make a Noisebridge2 in that building, and continue as before.
   Alan: As neat as NB is, one of the greatest toy shop around, there's nothing worth suing us for. If NB owned the building, we'd become a lawsuit magnet.
   Kevin: moves to name the holding company "NullPointerException" (yes Java)
   Alan: the thing about building purposes is it's a tremendously complex contract. Seven initial pages, but total stack of paperwork was 196 pages. One thing very central is specific timelines on which things have to happen. Asking and offers have to happen within a short timeframe, 2-3 days. If accepted, the bidder must move forward with the contract. Offers can't sit still. Ask/offer/counter-offer is a well-defined process with certain time periods for responses, otherwise the deal dies.  A good death, a nonprofit's death.
   Once you have a contract, there are performance requirements. For example within seven days, the seller has to provide tenant, lien, and other reports. The buyer has to review and respond within three days. And so on. No response == acceptance, the default.
   Some deadlines revolve around inspections, reporting problems, accepting or rejecting. For example, once you own the building, and you discover it's a hazardous waste site, you the new owner own that problem, and have to foot the bill.
   X: Many industrial properties have had underground tanks, there's a chance they may not have been remediated. The whole thing's a negotiation. Contingencies.
   Alan: it's a seller's market. Any contingency added by a buyer that makes the deal harder can lower chances of acceptance, and might increase the price. You need a good realtor to help negotiate these things.
   X: a former real estate broker, says it's a poor time to buy right now. Rent for now, then wait for the market to come down and have reasonable prices.
   X: The city has passed ordinances to protect PDR properties, and those properties are having trouble moving, and they might be current opportunities.
   PDR: "Production, distribution, repair." PDR-IA: Industrial, Art. City law protects these spaces from being converted to residential.
   2169#3 used to be a garment shop, and it was zoned for that. City has ruled that we're a public facility, we countered that we're a community facility, but we might be able to do an in-kind donation (~$20K) of providing free training to members of the public.
   If we took over 2169 we could make the building property tax-exempt.
   Jarrod: (needing a good realtor) What was their reaction to the loan structure. Was there anything about fundraising that affected the deal or was unusual. Alan's realtor said this was a most unusual deal, and they've been in business 62 years combined. "You seem like you know what you're doing, though it seems completely insane. But we'll give it a try." A realtor with a lot of experience, especially commercial properties, not residential.
   X: what was the commission? Seller pays commission. Buyer's realtor's commission is paid by the seller's agent. Alan says his experience contradict's some of X's statements.
   Ryan: during the process of looking at buildings, did Alan do FOIA requests, look at city databases, and such? Alan: kept his eyes open.
   X: did Alan come across "pocket listings?" Unadvertised, unlisted properties. Alan: many commercial properties are sold that way. This is another reason to have a good realtor.
   X: Does Alan have a referral for a broker? Alan will respond offline, after the meeting.
   Jarrod: Did Alan have people that were willing to lend money but didn't like his terms? Alan: that happened a few times. Some people wanted a lien on the property. A lien gives ownership rights to a lender until the term is up. Alan didn't want thte complexity of a bunch of different liens with 43 individual lenders. Also with some having liens and some not, it would confer advantage to the lien-holders. People advised by attorneys were told to get liens; people who actually were attorneys didn't even bring up liens. He got average interest rate of 2.85% across all the loans. Others wanted 4-5% but Alan turned them down.