FAQ BayBucks Users

What is Local Currency?
Local Currency is paper money, or any other medium of exchange, issued by a community to add wealth to the local economy, to support locally owned businesses, and to enhance economic sustainability and social justice.

According to Paul Glover, founder of Ithaca Hours, America's most successful local currency, local currency returns control over creation and distribution of money to communities in order to strengthen local trading, reinforce local business, make grants to community organizations, encourage equitable pay, and make new friends.

What are Bay Bucks?
Bay Bucks is a beautifully designed paper currency circulating within the Traverse region of northwestern Lower Michigan. Conceived of by a group of volunteers including business people, farmers, students, artists, professionals and community activists, Bay Bucks was launched in November, 2005.

Why Use Bay Bucks?
By accepting and spending Bay Bucks you support local community enterprise, help build social capital and regional economic resilience. Unlike federal dollars, Bay Bucks are spent into existence--not lent at interest into existence. Because it is backed by the faith and trust of this community, the wealth Bay Bucks represents stays at or near home, and holds the promise of helping us all live better.

The benefits of using a local currency may include:


  • Reinforcing trade within the community and expanding forms of commerce more accountable to the highest local standards of fairness and sustainability.
  • Influencing the wider community by reclaiming local economics.
  • Re-circulating local wealth within the region.
  • Empowering new businesses and job creation.
  • Highlighting possibilities for import replacement, reducing dependence on fossil-fueled transport.
  • Helping shoppers to afford premium prices for locally created goods and locally grown organic food.
  • Renewing community spirit.

Is Local Currency Legal?
Local currency is an entirely legal means to supplement to use of the federal currency within a community. Bills must not resemble US dollars--Bay Bucks are a different size and far more colorful (and beautiful) than US dollars.

Has This Been Done Before?
At least 60 communities in the US and Canada have local money systems. Bay Bucks is partially modeled on an internationally recognized system in Ithaca, New York where 1,500 people and 4000 businesses accept local currency in exchange for clothing, housing, movie tickets, massage, dentistry, legal advice, home repairs, bank fees, and hundreds of other services and goods.

Are Bay Bucks Taxable?
If you are a "taxpayer" under the provisions of the Internal Revenue Code, then transacting commerce with Bay Bucks may constitute a taxable activity. You will need to make that determination for yourself.

How Does A Bay Buck Work?
Just like other currency/money. Bay Bucks come in $1, $5, $10 and $20 denominations and are locally equivalent to federal dollars (Federal Reserve Notes). In other words, at participating businesses, $1 in Bay Bucks buys you as much as one federal dollar.

What Is the Bay Buck Based On? Where Does Its Value Come From?
The same thing that gives US dollars value: the belief of the people who use them. Bay Bucks have a much smaller geographic and economic base than dollars, but the principle is the same. Bay Bucks is not related to the federal currency as a standard of value but as a unit of account. Bay Bucks is backed by our faith in our community--our demand for goods and services and the ability to provide them.

Bay Bucks is a medium of economic exchange, like cash, checks, frequent flier miles and gift certificates. Put another way, if Bay Bucks are in your pocket, you can spend them nearby for things you want and need. Knowing how, where, and why to use Bay Bucks is where the added value comes from. Every time you use Bay Bucks you are expressing a commitment to our community.

Because it is locally controlled, if high inflation in the national currency should arise, the Bay Bucks system can revalue its unit of account to a more equitable measure upon which the community agrees. Therefore the Bay Bucks system could be insulated from shocks if the national currency has a problem.

Where Can I Spend My Bay Bucks?
A directory lists scores of participating businesses and individuals in the greater Traverse region. Local goods and services such as food, plumbing, carpentry, chiropractic care, massage, book keeping/accounting, and many others are among the offerings. As more people learn about the power of local currency, we expect the list to grow.

You can also ask any business to accept your Bay Bucks as cash--show them a copy of this brochure and the directory and let them know they can call or e-mail for more information. Try spending your Bay Bucks at garage sales and leaving them as tips (and don't forget to mention the directory).

How Do Businesses Participate?
There are different categories of membership, or a business may simply begin accepting and spending Bay Bucks. In exchange for a membership fee in US dollars, members receive an equal or greater amount in Bay Bucks, and either a listing or a display ad in the quarterly directory. Businesses use Bay Bucks in making change, paying suppliers, or as a portion of a paycheck to a willing employee.

Of course, nonmember businesses, along with everybody else in the region, are free to use Bay Bucks.

How Does My Business Handle Accounting for Bay Bucks?
Treat Bay Bucks just as you would cash. Because the government views local currencies as a cash equivalent, no special accounting procedure is needed. However, until Bay Bucks are accepted for deposit at area banks, you will need to total them separately from US currency. Many businesses count and use local currency as petty cash.

How do Individuals Get Bay Bucks?
Individuals can obtain Bay Bucks from participating businesses either by asking for your change in Bay Bucks, or by trading Federal Reserve Notes for Bay Bucks. If you work for a business that accepts Bay Bucks, then ask for part or all of your pay in Bay Bucks.

Why Don't All Member Businesses Accept 100% Bay Bucks For Goods or Services?
We recommend that businesses develop an acceptance policy that brings in Bay Bucks at a rate which they can reliably be spent. It is important for businesses and for the Bay Bucks system as a whole that Bay Bucks be spent soon--their value is realized as they circulate. Individual business circumstances differ, and all businesses always have the right to determine and change their own acceptance policy. Many businesses do accept 100% Bay Bucks, and are able to spend them as quickly as they earn them. Some businesses have one day a week, or some specific service or item for which they accept 100% Bay Bucks.

Who Controls The Supply Of Bay Bucks?
The issuance of Bay Bucks is managed by the Board of Directors of the Traverse Area Community Currency Corporation (TACCC). Issuance information is public and posted regularly on our web site as well as being published in the Bay Bucks directory.

What Do I Do If Some Of My Bay Bucks Get Torn Or Worn Out?
You can exchange your worn out Bay bucks for fresh ones by mailing them to TACCC with a stamped, self-addressed envelope. We'll return an equivalent amount of fresh Bay Bucks ASAP.