Proposition for 5-3: Franchulates (redux)

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Pelanor Eldrich
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Proposition for 5-3: Franchulates (redux)

Post by Pelanor Eldrich »

Proposition for 5-3: Franchulates

In an effort to expand the CDS by expansion to the mainland, I propose the ability to create CDS franchises or "franchulates" on the mainland. This bill allows mainland holders to join the CDS without abandoning established builds and neighborhoods. The franchulate is expected to fully uphold the CDS constitution and is treated as land annexed to the CDS.

In this scenario CDS acts as a trusted mainland aggregator. The AC sets up a new franchulate zone rate using one of two options:

1)A mainland global franchulate m2 rate when this best serves the CDS and the franchulate.

2)A LL tier proportion rate (such as 75%) when this best serves the CDS and the franchulate. For example a holder of a 8,192m2 franchulate would pay $30USD in land use to the treasury instead of $40 to LL.

3)All franchulates are subject to the same rate, although this rate can be altered by the AC on the 21st of each month or by passing a bill in the RA.

Franchisees must be citizens and apply for franchulates which are approved by the AC on a case by case basis. Approved franchisees are put on a waiting list so that the CDS may grant franchise when/if city tier allowance allows a mutually beneficial arrangement.

When granted a notarized Franchise License is held by the AC and franchisee. The city buys the mainland and sells it to the franchisee. An escrow (to be determined by the AC) may be required prior to this transaction.

Once the franchulate is approved and purchsed, is now CDS territory and subject the ToS, codes and constitution. A notecard, objects to be determined (such as flags/certificates) by the SC must indicate the franchulate status of the mainland parcel. Franchulate land use fees are due every 21st of the month or at a set period set by the AC.

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Post by Patroklus Murakami »

I thought you might revive this one Pel!

Your proposal didn't get a full airing the first time around so I'm keen to understand more about it this time. Reading it for a second time I feel I understand a little more about how it might work in practice and the possible reasons behind it. But I have a few questions and scenarios I'd like you to address.

1) What problem is the proposal trying to solve? Is it primarily a way to expand which doesn't involve the (expense and bother of the)purchase of new sims, deciding a theme, building, administration etc? Or is it aimed at specific groups or individuals on the mainland?

2) What does the CDS gain from this? In terms of: finances, territory, citizenry, specialist skills or businesses.

3) What does the franchisee gain from this? Less tier, cheaper land fees, voting rights, government protection and regulation/assurance for businesses?

4) Here's a scenario: I have 8000 m2 on the mainland, 3500 is my lakeside home that I use as my main residence, the other 45oo is in two lots - one for my furniture store and one for a project I'm planning. If I bring all or most of this territory into the CDS fold what would happen? Who would pay what to whom? Who would 'own' that land in future? What would be the benefit to the CDS and to me?

I hope you don't mind me grilling you on this! I would like to hear more about the motivation for the proposal. You gave a couple of examples in the short discussion that took place last time but I didn't really grasp what you were getting at. I look forward to seeing your reply.

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Post by Claude Desmoulins »

Pat, I'm going to try to tackle this. I hope Pel will chime in if I miss something.

[quote="Patroklus Murakami":ouozuvu0]

1) What problem is the proposal trying to solve? Is it primarily a way to expand which doesn't involve the (expense and bother of the)purchase of new sims, deciding a theme, building, administration etc? Or is it aimed at specific groups or individuals on the mainland?

2) What does the CDS gain from this? In terms of: finances, territory, citizenry, specialist skills or businesses.[/quote:ouozuvu0]

We gain primarily revenue and mainland presence. It's not meant to replace sim level expansions, but to add to our profile in world.

[quote:ouozuvu0]3) What does the franchisee gain from this? Less tier, cheaper land fees, voting rights, government protection and regulation/assurance for businesses?[/quote:ouozuvu0]

Yes, yes, and yes.

[quote:ouozuvu0]4) Here's a scenario: I have 8000 m2 on the mainland, 3500 is my lakeside home that I use as my main residence, the other 45oo is in two lots - one for my furniture store and one for a project I'm planning. If I bring all or most of this territory into the CDS fold what would happen? Who would pay what to whom? Who would 'own' that land in future? What would be the benefit to the CDS and to me?
[/quote:ouozuvu0]

By yourself, it doesn't make sense, but imagine that there is also "Anonymous Entrepreneur" who owns 45oo m2 of mainland and also wants to franchulate.

You are just under the 1/8 sim tier break and pay $25 US/mo. Anonymous is well under the break and pays $25/month. By turning both these into CDS owned land, the city pays $40/month (for 12000 m2) as compared to the $50 you and Anonymous pay directly to LL. You and Anonymous get say a 10% discount over LL tier, paying $22.50 instead of $25. CDS makes $5 a month. Mainland locations of your N.Inc. or NRC are very clearly associated with the city and the commerce protections it provides. In order to provide the tier economy of scale, a single avatar would have to become the official owner of all franchulated land.

I'm sure I missed something, but I hope this clarifies a bit.

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Re: Franchulates

Post by Pelanor Eldrich »

Hi Pat! Yes it's in our platform so it got resurrected. :) Claude hit all the major points so I'll just elaborate a tiny bit.

The overall abstract goal is a mechanism by which we can expand to the mainland and offer the kind of zoning and structure many mainland residents are yearning for.

The attraction for a potential franchisee is much the same as it is for any other CDS citizen. To my mind, this chiefly boils down to: "cheap land and gov't". Cheap land is readily available for rent, but zoned land with a legal system on the mainland is not.

Finances: The CDS would only approve a slate of applications when it would be revenue positive. This means 2 or more applications "in the hopper" at once so we can get economy of scale by buying e.g. 16,384m2 for 2 x 8,192m2 sized franchulates.

Territory: CDS gains territory and sovereignty over franchulate parcels on the mainland.

Specialist Skills / Businesses: Artisans and businesses are thus able to join the CDS without having to relocate. Currently we have the option of having a citizen buy a microplot and register a NRC with the charter specifying place of business outside the CDS. Ideally though we would franchulate these mainland parcels if we could work out a deal where both the land owner gets cheaper land and the CDS increases monthly revenue.

Ok, so let's take your #4 example. 8000m2 total that you'd like to form one or multiple franchulates with. You would apply for 1-3 franchulates. We would approve these applications if we could get another 8,192m2 application. When approved you would own your plots as if they were actually in NFS. You would pay land use fee at the franchulate rate to the AC.

The franchulate rate could be, as Claude suggests, 90% of tier globally. Depending on monthly finances, etc. Sudane could specify a $L/m2 rate which also gives great flexibility, ie. a low rate which has other citizens footing part of the bill, to a high rate acting as a tax.
The AC pays tier to LL.

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Re: Franchulates

Post by Diderot Mirabeau »

[quote="Pelanor Eldrich":1u8vqzhe]The overall abstract goal is a mechanism by which we can expand to the mainland and offer the kind of zoning and structure many mainland residents are yearning for.[/quote:1u8vqzhe]

I'd be interested in hearing your answer to the following:

If some land baron wants to set up his 16,384 sqm as a Neufreistadt-chartered franchulate and he subsequently partitions his land into 16 parcels of 1,024 sqm each to rent out to tenants will these tenants have any political rights in accordance with our constitution?

In my view the essence of what ties this society together is the fusing of land holding and political rights. That's why it's currently disallowed to rent out land to other people as it would create an underclass of people who live here but have no political rights.

The idea of franchulates seems to me at a first glance to be most of all a financial setup which might just as well be conducted by a private company rather than by a government?

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Post by Claude Desmoulins »

One of the provisions of the CC&R is that sublets are not allowed. If we make that provision applicable to the franchulates, the scenario you describe would be illegal. I would very much favor this approach. One of the key concepts of the bill is that the franchulate should be like any other parcel in the republic excepting that:

1. It is not on a NFS/CDS island sim
2. Theme covenant requirements (roof pitch, window size and the like ) do not apply.

We shall have to redo CC&R anyay to accommodate CN.

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Post by Sudane Erato »

This has always been an interesting proposal. If we consider that an overall goal is expansion of our "project", the CDS network of structured society based on values and legal rights, it seems one consistent way to add to that network.

But, I must throw one technical wrench into the works. As everyone knows, private sims are "owned" in the LL sense by the "Estate Owner", a single person/avatar. Within the system of estates, that "owner" can then "deed" land to other person/avatars, providing them with significant rights. However, the "owner" always retains "Reclaim" rights over that land. This is the fundamental basis of Neufreistadt society.

By investing Rudeen with "ownership" of the sim, and making her, in effect, a "machine" of the government, we have somewhat shakily established the system by which the government of CDS wields its authority over the citizens. The effective "two levels" of ownership make this possible.

On the mainland, we do not hve this opportunity. The proposal outlines the steps by which the CDS "buys" the mainland parcel, and then "deeds" or "sells" parts of that parcel to new or existing residents. All this while somehow maintaining its volume tier rate over that land.

But it doesn't work like that on the mainland. The CDS can certainly buy large parcels, or even sims, at good rates. But as soon as it "deeds" or "sells" portions of those parcels to the new citizens, it loses completely any authority over them, and, indeed, no longer counts that land as land on which it owes tier.

This means that the only way for the CDS to maintain authority, and benficial tier rates, over mainland land is for the new citizens to be renters. I think that this is not being proposed here. If it is, we have a much larger issue to discuss, the problem of integrating renters into our social and administrative system.

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Post by Claude Desmoulins »

Maybe thisis an error of language. From speaking with Pel, I had the impression the city "machine" would remain the official owner ofthe mainland parcel. BTW will the group tool changes of 1.12 (whenever they come) help this situation?

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Post by Sudane Erato »

[quote="Claude Desmoulins":7ostc5vf]Maybe thisis an error of language. From speaking with Pel, I had the impression the city "machine" would remain the official owner ofthe mainland parcel. BTW will the group tool changes of 1.12 (whenever they come) help this situation?[/quote:7ostc5vf]If the city machine remains the owner, then the occupants are tenants... it seems quite simple.

The new group rules appear to provide all kinds of wonderful structure for a group. But they don't appear to me to alter the ownership structure for mainland land, which is the issue here.

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Post by Claude Desmoulins »

This raises a different question. If....

1) Citizens paying land fee directly to the government

[b:3be8kvx7]and[/b:3be8kvx7]

2) "Dual" ownership of land both by a government avatar and the citizen

are considered unalterable sine qua nons of our system, then the whole franchulate idea is DOA.

So let's look particularly at the second of these. Ownership of city land by Rudeen gives the government control, ie the ability to reclaim land for non payment. Citizen 'ownership', as Aliasi has pointed out is a fiction under the current SL system. There is nothing that can prevent Rudeen from nationalizing the whole sim if she wishes. So what does the citizen get by "owning" the land?

1) The ability to sell it. However, Rudeen still has to participate in any transfer.

2) "ownership tools" (bans/object returns/etc.)

In point of fact we all 'rent' from Rudeen. Being on an island just gives us a slightly better tool set. After all, we pay Rudeen; Rudeen pays LL. We can't sell the land without Rudeen's assent and participation.

If we think of a citizen as an avatar who pays a monthly land fee to the government to hold land over which the government has final control, both the current setup and a franchulate would fit. The difference between them would be that the franchulate holder wouldn't have the "owner tools". Then it becomes a trade off of losing those tools in exchange for a land fee discount relative to LL ,and our legal protections. Some will like that trade off and some won't. Why not let [i:3be8kvx7]them[/i:3be8kvx7] choose?

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Claude has it exactly right.

Post by Pelanor Eldrich »

That is in fact what I had envisioned. Sorry for the lack of clarity. Yes, Rudeen owns the franchulate in my proposal. This segways into my other measure that was defeated last term, ie. "commercial license".

Right now a mainland commercial establishment can gain SC/legal protection by company officers becoming CDS citizens, registering a NRC (Newfreistadt Registered Company) and setting up corporate HQ on a microplot. The company charter would specify the mainland or other private island sim where main business is conducted.

This is in fact what Job Finder Inc. plans to do with my help.

While the CDS benefits from $L10,001+ escrow from limited liability corp., it gains little from an unlimited liability NRC HQ on a microplot. I felt this legal protection was worth something and so floated the idea of selling commercial licenses for mainlanders or other PIs who wanted to keep full control over their land and still obtain CDS legal protection for their businesses. License holders would not pay court costs and the license fee serves as the escrow/enforcement mechanism. No court fees would be charged to license holders.

If a commercial case is brought before the SC by two non-citizens, the loser would be charged the court costs. The problem is that decisions rendered by the SC over 2 non-citizens are non-binding (and the court costs cannot be guaranteed to be collected)...

...unless they escrow funds a priori either at the SC or at Eldrich Financial.

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Re: Claude has it exactly right.

Post by Ashcroft Burnham »

[quote="Pelanor Eldrich":30lh7u20]If a commercial case is brought before the SC by two non-citizens, the loser would be charged the court costs. The problem is that decisions rendered by the SC over 2 non-citizens are non-binding (and the court costs cannot be guaranteed to be collected)...

...unless they escrow funds a priori either at the SC or at Eldrich Financial.[/quote:30lh7u20]

It is not strictly true that a decision of a court over non-citizens is non-binding, since non-citizens can always be banished. That might not be a very [i:30lh7u20]effective[/i:30lh7u20] means of enforcement when the non-citizens in question have little incentive to come to Neufreistadt, but, strictly, the decision would still be binding on them in Neufriestadt law, in the same way as a parking fine in the Ukrane is binding on you even if you leave and never go back there again, and all chance of effective enforcement is thereby lost.

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Post by Claude Desmoulins »

Here is the current form of the Franchulate bill. I would suggest that, given recent constitutional changes, references to the AC be replaced with "The Chancellor or his/her designee".

--------

Proposition for 5-3: Franchulates

In an effort to expand the CDS by expansion to the mainland, I propose
the ability to create CDS franchises or "franchulates" on the
mainland. This bill allows mainland holders to join the CDS without
abandoning established builds and neighborhoods. The franchulate is
expected to fully uphold the CDS constitution and is treated as land
annexed to the CDS.

In this scenario CDS acts as a trusted mainland aggregator. The AC
sets up a new franchulate zone rate using one of two options:

1)A mainland global franchulate m2 rate when this best serves the CDS
and the franchulate.

2)A LL tier proportion rate (such as 75%) when this best serves the
CDS and the franchulate. For example a holder of a 8,192m2 franchulate
would pay $30USD in land use to the treasury instead of $40 to LL.

3)All franchulates are subject to the same rate, although this rate
can be altered by the AC on the 21st of each month or by passing a
bill in the RA.

Franchisees must be citizens holding non mainland CDS land and apply
for franchulates which are approved by the AC on a case by case basis.
Approved franchisees are put on a waiting list so that the CDS may
grant franchise when/if city tier allowance allows a mutually
beneficial arrangement.

Franchulate land holdings shall not be taken into account when
determining in which constituency/ies a citizen may vote. All
franchulate land shall be subject to those covenant provisions which
apply to all CDS land.

Under no circumstances may franchulate holders sublet franchulate land.

When granted a notarized Franchise License is held by the AC and
franchisee. The city buys the mainland and sells it to the franchisee.
An escrow (to be determined by the AC) may be required prior to this
transaction.

Once the franchulate is approved and purchsed, is now CDS territory
and subject the ToS, codes and constitution. A notecard, objects to be
determined (such as flags/certificates) by the SC must indicate the
franchulate status of the mainland parcel. Franchulate land use fees
are due every 21st of the month or at a set period set by the AC.

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