Coop Forced To Get Loans For Program

The Coop's large-scale program of expansion, based on an expected increase in student enrollment, has forced the society to seek a loan of up to $100,000, it was learned yesterday. Moreover, loans of up to $200,000 may be needed before the Coop can take over the present quarters of the Harvard Trust Company by the fall of 1957.

The expansion is justified, according to John G. Morrill, general manager of the store, because management expects the student body to grow in the near future. "We take President Pusey's word for it," Morrill said, explaining the reason for this assumption.

The current loan is necessary because of the low level of the Coop's cash reserves, Morrill said. He expects the loans to be paid back within 90 days, and that the '55-'56 patronage refunds of 8-10 percent, which have already been voted, will not be changed.

Budget Burdens

The recent cash shortage resulted from the large amount spent on expansion, which, added to last year's patronage refunds, amounted to about $500,000. The society had bought a building on Bow Street last year for its trucks and new accounting department and had enlarged its text book department.

An added burden on last year's budget was a sum of $8000 for three years' back taxes on membership fees. In previous years, the Coop had claimed that the fees were an untaxable "contribution to capital," not to be considered as income. This year, the directors decided to avoid counsels' fees and interest and pay what the government demanded.

The net income for the year 1954-55 was only $8886 as compared to the 1953-54 total of $22,643 because of the additional expenses.