History of the Salt Spring Dollars

The Birth of a Currency

Bob McGinn and Eric Booth of the Salt Spring Island Monetary Foundation
(Photo by Derrick Lundy)

The concept of Salt Spring Island Dollars was the result of roundtable discussions of the Sustainable Salt Spring Island Coalition. In the fall of 2000, the group was looking at different island nations around the world (Isle of Man, Jersey, Cayman Islands, etc.) examining how their governments and economies functioned. One of the common factors of these islands was that they each had their own local currency. Two questions arose – would it be possible to establish a local currency for Salt Spring, and if so, how could it benefit the community?

The Problems

Further research examined a wide range of "alternative" currencies (e.g. Toronto Dollars, LETS and Hours systems). It appeared that none of the alternative currencies had achieved 'near universal acceptance.' The primary limiting factor identified was that none of the local currencies were 100% redeemable into their national currency, and, as a result, the majority of merchants were hesitant or unwilling to accept a currency unless it could "pay the bills." Next was the question of how a currency goes into circulation and receives and/or maintains any value to the holder. It also appeared that, in most cases, operation of local currencies were segregated from local financial institutions.

The Solutions

Having identified these problems, it was decided any solutions must address all of these concerns. Several brainstorming sessions later, an idea surfaced that provided an answer directly and indirectly, to all of the major problems. It was suggested that if our currency had a two year expiry date, any bills that had not been redeemed by the expiry date (e.g. collected, left the island, lost, etc.) would represent a "profit." By creating a profit, to cover costs, it would be possible to have the currency go into circulation through a one-to-one exchange with the Canadian dollar. This meant it could be backed 100% by the Canadian dollar. To our knowledge this had never been done by any local currency, anywhere in the world.

Limited Editions

Next came the idea to have limited editions of Salt Spring Island art featured on the back. This would help to make the bills collectible, after the expiry date. It was soon pointed out that with a year round population of 10,000, an annual tourist flow of over 200,000 and tens of thousands of currency collectors around the world, the potential income from an edition of 20,000 of each bill was significant. It was then decided to form a not-for-profit society, the Salt Spring Island Monetary Foundation, to facilitate the process of returning the proceeds of the venture back to the community.

Mission Statement

Thus, on July 17th, 2001, the SS IMF was registered with the Province of British Columbia. It's mission statement is as follows: "The purposes of the Society are to design, issue and maintain a local currency for Salt Spring Island with the goal of raising funds for worthwhile community projects while promoting local commerce and goodwill." Following the formation of the IMF, major institutions (Island Savings Credit Union, CIBC, Bank of Montreal, Canada Post, SSI Chamber of Commerce, etc.) on the Island were approached with the concept. With these institutions lending their support to this community initiative, it came to pass that Salt Spring Dollars are now available and accepted on Salt Spring on the same basis as the national currency. The Salt Spring Island Dollars were introduced to the Island on September 15th, 2001, at Salt Spring's largest annual gathering, the Farmer's Institute's Fall Fair.

Evolution of the Solution

As we approached the first expiry date, the Board of Directors discussed the successes and challenges of the future. During these discussions, it was brought forward that the expiry date was causing some concern with members of the community. It was decided that our role in the community would be either to offer loans, at no interest, to worthwhile community projects, co-invest with those groups, or invest on our own. The reason we did this was to ensure we did not deplete the assets which back the Salt Spring Dollars in circulation. As a result, we decided to eliminate all expiry dates from the bills, and, to move towards an asset based currency. Although the currency is now backed mainly by Canadian Dollars, it has always been our intention to back it with solid community investment. This will maintain the assets while, at the same time, benefiting the community long term.

The Next Step - Silver

In the spring of 2006, we began planning our first silver coin edition. Recognizing the long standing history of currencies backed by precious metals, we felt this was a natural progression for a local currency. Our first silver coin was issued in December 2007.

A Note from the Salt Spring Island Chamber of Commerce

Doug Mitchell, President of the Salt Spring Island Chamber of Commerce says, "The Chamber wholeheartedly supports Salt Spring Dollars. We immediately realized the many benefits of having a local currency and we believe it will be an enormous marketing success."

Islanders can buy groceries, gas or clothes with $$ as initial support from local merchants has been overwhelming.

Some merchants have decided, from time to time, to offer a premium exchange rate for $$ to help promote on island shopping.

As Salt Spring dollars are backed by CND$'s at our local banks, an immediate trust in the business community has been created in the local currency.

Some merchants interviewed said that they would be using their "overflow" bill compartment in their cash register to handle the $$, just as they do American dollars.

The SSI Chamber of Commerce's website address (saltspringtoday.com) has been placed on the front of every bill.

"This is just one more way Salt Spring dollars will help to generate revenue for the Island. It's like putting a Salt Spring Island business card in someone's wallet," says Eric Booth, Director of the SS IMF. "We will also be promoting the $$ dollars via the internet to currency collectors around the world."