Senate Bill 2774 Summary

• Establishes a comprehensive legal framework for incorporating and operating cooperative associations in Mississippi, allowing five or more adults (with at least one resident) to form a cooperative by filing articles of association.

• Grants cooperatives general powers including perpetual existence, ability to sue and be sued, make contracts, borrow money, invest funds, and conduct business domestically or internationally, while prohibiting cooperatives from engaging in banking, insurance, or operating public railroads.

• Requires cooperatives to maintain a board of directors with at least five members (or three for cooperatives with fewer than 50 members), all of whom must be members; establishes voting rights where each member has one vote regardless of stock holdings.

• Mandates annual distribution of net proceeds to patrons based on their patronage ratio, with provisions for setting aside educational funds (up to 5%), paying dividends on capital stock (capped at 6% annually), and distributing remainder through reserves or direct patronage distributions.

• Restricts use of the term "cooperative" to associations organized under this act or credit unions, with penalties up to $100 per day for improper use; requires annual reporting to Secretary of State and establishes filing fees ranging from $15 to $50.