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forms. In version 1, operating until 2001, volunteers in various charities were given a
plastic (non­banking) card as acknowledgement of their work; they could present this at
participating shops to claim a discount – typically 15 per cent – in exchange for their
volunteer hours. The idea was that there would be a three­way gain: volunteer
organisations would attract more help; volunteers would receive discounted meals and
other goods; and shops with excess capacity would be saved from advertising. Both the
Mall of America and the Hennepin County Board of Commissioners were involved in the
early efforts. One volunteer hour was worth ten Community Service Dollars, and one
Community Service Dollar was worth US$1 in purchasing power.
Version 2, which operated from 2001 to 2004, saw the introduction of a magnetic
stripe card that could be used in combination with a participant’s own cash, cheques or
credit cards. This ‘loyalty rebate card’ was swiped through the retailer’s Verifone
machine after the purchase and connected through phone lines to the office of CHC
Data, the company that licensed limited rights to develop Joel’s patented dual currency
system. CHC Data then processed the various volunteers’ hours worked, rebates earned
and cash spent at participating businesses. CHC Data also tracked merchant
contributions and donations to non­profit organisations through a web­based transaction
system.
The Community HeroCard programme relied on merchant rebates to participants
to drive the volunteer incentive programme. From the average merchant rebate of 10 per
cent, CHC Data subtracted 20 per cent to pay for the scheme and gave 40 per cent to a
charity of the cardholder’s choice. The remaining 40 per cent of the merchant’s rebate
went back to the customer as a cash rebate, which he or she could spend anywhere
within the network of participating businesses.
However, through various errors of market positioning, programme design and
leadership, the initiative failed to achieve a critical mass of participation and transactions,
closing its doors in January 2004 when CHC Data went belly­up. The ideals of the
programme never gained enough momentum to push through the barriers it faced.
Many individuals from the sectors of business, government, charitable foundations and
community organisations felt drawn by the vision of Community Service Dollars as a
reward for volunteers and as a way to bring more customers to community businesses.
However, the challenges related to the understanding of rebates, volunteer incentives,
private ownership and intellectual property laws were beyond the resources and
management capabilities of the personnel involved.
Version 2 of the scheme advanced the technology application of cash debit cards
and incorporated an important incentive for merchants: closed­circuit cash rebates.
Essentially, the concept of this is: ‘Spend $100 here and we will give you an immediate
cash rebate to spend elsewhere in the network of more than 50 businesses.’ In this sense
the scheme was of greatest benefit to merchants and contributed to the local multiplier
effect. However, both the merchants and the volunteers found version 2 very confusing