By Mark Anderson – Staff Writer, Sacramento Business Journal. California lawmakers have considered allowing public banks several times, starting in the depths of the financial crisis.

The city of Los Angeles and the city and county of San Francisco on Tuesday approved support for an assembly bill that would allow local governments to form their own public banks.

Having the two highest-profile cities in the state show support is a sign that a “coalition is coming together,” said Jonathan Underland, communications director for Assemblyman Miguel Santiago, D-Los Angeles, who, along with Assemblyman David Chiu, D-San Francisco, introduced Assembly Bill 857 in March.

“We want cities and counties to have the ability to create a public bank if that makes the most sense for their constituents,” Underland said. “Now, we don’t have the ability to even consider it. It is a local control bill. It would allow municipalities to experiment with this. It gives cities the opportunity to explore this.”

Continue reading on Sacramento Business Journal.

The public banking revolution has arrived! In Ellen Brown’s latest article, she discusses the I-Bank bill #SB528, our cities and regional public banking bill #AB857, and the momentum gaining around the country as policymakers race to form the first public bank in the United States since the Bank of North Dakota, founded in 1919.

Read the article on Truthdig.

On Tuesday morning, the Los Angeles City Council passed a resolution introduced by LA City Council President Herb J. Wesson in support of AB 857 – a bill to give California cities and municipalities the option to start their own public bank. Arguing for the measure, City Council President Wesson had this to say:

“This morning’s vote is for the people that too long have been underbanked and overcharged. The reality is our financial system is not working for a large majority of people, in particular communities of color. A public banking system in our state is a much-needed first step to bring economic justice to California’s most disadvantaged communities.”

Assemblymember Miguel Santiago (D-Los Angeles), who is a joint-author of the Public Banking Act, responded, saying: “Californians from the grassroots to the halls of power are weary of a corporate banking system that doesn’t work for them. Wall Street needs people-powered competition, and a public bank for public good is the right place to start. Council President Herb Wesson has been a bold champion of public banks for many years, and I couldn’t be more grateful for his leadership and the support we’ve seen from so many others across the state.”

The City of San Francisco – home district of AB 857 joint author Assemblymember David Chiu (D-San Francisco) – will consider a substantively identical resolution in support of the bill this afternoon.

“The public’s money should serve a public purpose, not line the pockets of Wall Street investors,” said Assemblymember Chiu. “Time and time again, we have seen big banks invest billions of dollars of our money in institutions most Californians are opposed to. I am grateful to see such broad support for our efforts to reinvest the public’s money in our local communities.”

Trinity Tran, founding member of the California Public Banking Alliance said, “This is an unprecedented multi-city coordination among the biggest local governments, representing over 6 million people in the state of California. Wall Street Banks have proven that their interests are not aligned with California’s communities. Local governments have essentially been a captive market for mega-banks and now with this legislation, we have the opportunity to build a new alternative banking system through locally-controlled, socially and environmentally responsible public banks, enabling cities and counties to recapture public dollars and have a say over the financing of our own localities.”

Continue reading on Los Angeles Sentinel.

Today on Flashpoints: The push for a public bank in California. Trinity Tran and Sushil Jacob with the California Public Banking Alliance talks to KPFA’s Dennis J. Bernstein about the groundbreaking California State Assembly Bill AB 857, the growing public banking movement and why this is a pivotal moment for Californians. Interview starts at 21 minutes on the dial.

KPFA 94.1 – The Push for Public Banks

Two California Democratic lawmakers have introduced a bill that would develop a state-owned banking system, modeling it on a program run by one of the smallest states in the union.

California Assemblymen Miguel Santiago, D-Los Angeles, and David Chiu, D-San Francisco, have introduced Assembly Bill 857, which would enable local governments to charter their own public banks.

North Dakota, with a population of fewer than 1 million people, has America’s only state-owned bank. The Bank of North Dakota this year is celebrating its centennial anniversary.

Santiago and Chiu would bring a similar system to California’s 39 million residents, arguing that a public institution might better serve the interest of low- and moderate-income households.

Continue reading on the Sacramento Bee.

Legislation introduced Monday could lay down the foundations for the creation of public banks in California and provide an alternative to San Francisco’s use of profit-driven commercial banks.

Currently there are no public banks in California, and no legal avenues to create one. But Assemblymembers David Chiu, D-San Francisco, and Miguel Santiago, D-Los Angeles, hope to change that with the introduction of Assembly Bill 857, which would allow jurisdictions to create public banks through a charter process.

The idea of a publicly-owned bank has gained traction in recent years as advocates and elected officials have called upon The City to divest its $11 billion budget out of commercial banks and into community centered projects that would better reflect San Francisco values.

“Wall Street banks have invested in oil pipelines, gun manufacturers, private prisons and companies with unfair labor practices,” Chiu said at a news conference Monday. “The opposite of what our state stands for.”

Continue reading on SF Examiner.

FOR IMMEDIATE RELEASE

Los Angeles, CA/San Francisco, March 11, 2019 – Asm. Miguel Santiago (D-Los Angeles) and Asm. David Chiu (D-San Francisco) held press conferences in their respective districts on Monday to introduce a new bill that will make it easier to establish regional and municipal public banks throughout the state of California.

The California Public Banking Alliance (CPBA) is sponsoring the legislation. CPBA designed the bill to provide localities a flexible framework for establishing public banks with appropriate terms, exceptions, and constraints.

“Public banking is one way we can start restoring economic power to our communities,” said Sushil Jacob, Senior Staff Attorney for Economic Justice with the Lawyers’ Committee for Civil Rights of the San Francisco Bay Area, one of CPBA’s founding members. “Wall Street banks routinely deny small business owners of color access to the credit they need to grow their businesses. When business owners of color do manage to get these loans, the fees and interest rates are often higher. These discriminatory patterns must end and the City can lead the way in providing an alternative.”

AB 857 will mobilize capital to take on the affordable housing goals that Assemblymembers Santiago and Chiu have already come together to champion.

“The public’s money should be used for public good.  Time and time again, we have seen big banks invest our money in institutions most Californians are opposed to–oil pipelines, gun manufacturers, private prisons, and companies with unfair labor practices.  This legislation allows us to take a first step towards ensuring the public’s money is reinvested in our local communities,” said Asm. David Chiu in a statement released this week.

Asm. Miguel Santiago released the following statement, “It’s pretty obvious that the Wall Street system of wealth distribution has created an income inequality crisis and nowhere is that more visible than right here in my district, where luxury condos loom over Skid Row. Instead of making rich men even richer, our resources should be invested in community development: parks and green spaces, free community college, new schools, smooth roads, and cleaner air. With AB 857 we’re laying the groundwork for a financial system that will give Californians access to capital they can afford, and empower communities to invest in projects that improve everyone’s quality of life.”

Around the country, as political discourse escalates on how to fund ambitious proposals for social equity and environmental justice, AB 857 may be one of the most important bills to watch.  This legislation will pave the way for reducing the cost of living in California.

“Wall Street Bank are financing climate destruction and they are doing it with our tax dollars,” said Doug Norlen, Director of the Economic and Policy Program at Friends of the Earth. “Public banks can invest our money into sustainable community projects right here in California instead of lining the pockets of Wall Street and Big Oil.”

CPBA is a coalition of grassroots public banking advocacy groups pushing for regional and municipally-owned public banks across California. Member groups include the San Francisco Public Bank Coalition, Public Bank Los Angeles, Public Bank East Bay, South Bay Progressive Alliance, Public Bank Santa Barbara, Public Bank San Diego, People for Public Banking Santa Cruz, Orange County Public Banking Coalition, and Friends of Public Banking Santa Rosa. Beneficial State Foundation, Friends of the Earth, and Lawyers’ Committee for Civil Rights of the San Francisco Bay Area are also members of CPBA.

Press Contact:
Sylvia Chi
sylviachi@gmail.com
(443) 977-4992

Originally posted in Medium.

Dianne Feinstein, our Senator, had a viral moment on Friday, February 22, when a video circulated online of her lecturing Bay Area children about why she does not support the Green New Deal. The children were her constituents, on a visit to her office as part of an action coordinated with Sunrise Movement Bay Area, a youth-led climate movement. Sen. Feinstein told them, “There’s no way to pay for it,” and went on to detail how her decades of political experience informed her pessimism on the Green New Deal.

Sen. Feinstein presented the activists with a draft of her alternative resolution, which calls for the United States alone to eliminate greenhouse gas emissions by 2050, far short of the Intergovernmental Panel on Climate Change’s warning to limit global warming to 1.5°C. (Sen. Feinstein has since abandoned this resolution, and Senate Democrats have introduced a simpler “unity” resolution on climate change.)

In contrast, the Green New Deal proposal incorporates economic, industrial, and social justice policies to effect deep, systemic change to decarbonize the country in one decade. And as the name suggests, this type of massive transformation and government intervention has a precedent in the original New Deal, which rescued our country from the worst impacts of the Great Depression. As explained by economist Stephanie Kelton and others, the federal government paid for the New Deal’s massive public investments by exercising its financial sovereignty and creating credit via the Federal Reserve. Moreover, as public banking expert Ellen Brown has highlighted, during the New Deal, the federal government’s Reconstruction Finance Corporation (RFC) lent over $2.5 billion in agricultural loans, backed vast infrastructure investments, and re-stabilized the economy through emergency loans to states and for disaster relief.

The Green New Deal relies on a network of public banks — like a decentralized version of the RFC — as part of the plan to help finance the contemplated public investments. This approach has worked in Germany, where public banks have been integral in financing renewable energy installations and energy efficiency retrofits. And it’s an idea that has taken root in California: last November, over 430,000 Angelenos voted in favor of amending Los Angeles’ city charter as a first step towards a public bank, and Oakland, Berkeley, Richmond, and Alameda County have completed a favorable feasibility study. Sen. Feinstein’s own state director, Jim Lazarus, is a member of San Francisco’s Municipal Bank Task Force, which just completed a year’s worth of research into public banking and is presenting the San Francisco Board of Supervisors a range of public bank models to choose from. The Board — of which Sen. Feinstein used to be a member — recently unanimously passed a resolution in favor of the California Public Banking Alliance’s state legislation for a new charter that will allow cities and counties to establish their own public banks.

How will local or regional public banks help pay for the Green New Deal? They will make low-interest loans for building and upgrading infrastructure, deploying clean energy resources, transforming our food and transportation systems to be more sustainable and accessible, and other projects. The federal government can help by, for example, capitalizing public banks, setting environmental or social responsibility standards for loan programs, or tying tax incentives to participating in public bank loans.

Most importantly, as one of the young activists in the video pointed out, the cost of inaction (or insufficient action) far outweighs the cost of implementing a paradigm-shifting program like the Green New Deal. The Green New Deal’s job training, research and development, retrofitting and infrastructure investments, and technology deployment will stimulate and make our economy more resilient and better adapted for the more frequent wildfires, storms, and heat waves we face right now.

Sylvia Chi is a member of Public Bank East Bay and chair of the legislative committee of the California Public Banking Alliance.

The Board of Supervisors urged the state to create a public banking charter on Tuesday, its first formal show of support for a movement to break from Wall Street.

Supervisors unanimously co-sponsored and approved a resolution that backs publicly-owned bank and called for state legislators to allow local jurisdictions like San Francisco to proceed. Supervisor Sandra Lee Fewer introduced the resolution days the same week the Treasurer’s Office released its draft report of what a public bank could look like.

A public bank is enticing to advocates like the San Francisco Public Bank Coalition who say the city’s $11 billion budget would be better invested in affordable housing, small business, clean energy, and student loans. Big banks have been known to invest customer funds in things San Francisco opposes like oil pipelines, immigrant detention centers.

Former Supervisor Malia Cohen set off a municipal bank task force that began meeting in 2018, culminating in a report supervisors will weigh in the next couple of months. Days before leaving office, she held a hearing on banking options presented in an initial report that was criticized for not going far enough and instructed them to think big.

The Treasurer’s Office updated the draft report, which task force members took up at their final meeting on Thursday. Though there’s still details left to be worked out, three models could see a bank that purely invests, purely divests from Bank of America and US Bank, or does both.

“In Sacramento, they really are eager and curious to know what stance San Francisco is going to take on this,” said Sushil Jacobs, a task force member who works with the California Public Banking Alliance. “We’re looking to pass legislation and counties to pursue charters to pass their own legislation.”

Continue reading on SF Weekly.

On Monday, February 4, ten activists from the California Public Banking Alliance went to Sacramento to attend a hearing on public banking, convened by Assembly Member Monique Limón (chair of the Assembly Banking and Finance Committee) and Assembly Member Cecelia Aguiar Curry (chair of the Assembly Local Government Committee).

Before the hearing, we had several meetings with people concerned with public banking, including a very productive long meeting with a key staff member in State Treasurer Fiona Ma’s office.

The hearing itself featured two speakers from state government (Department of Business Oversight Commissioner Jan Lynn Owen and Treasurer Fiona Ma), both of whom spoke about exercising fiduciary care and responsibility in managing taxpayer money and licensing all banks, including public banks.

They were followed by two public bank advocates — our own Sushil Jacob, and Dick Mazes, an advocate for transforming California’s Infrastructure and Economic Development Bank (the “iBank”) into an entity that could take deposits from cities and counties, and handle them the way it currently handles about $500 million in state money. The iBank is not really a bank, but a revolving loan fund providing loan guarantees and conduit bonds to California projects needing funding.

The third panel consisted of two bankers and two county treasurers. The representative of the California Bankers Association (the voice of the big banks) claimed that governments can’t handle the security and compliance requirements that banks deal with every day. (He neglected to mention the problems with security and massive disregard of compliance which the Wall Street banks are known for.) The county treasurers of Yuba and San Francisco counties both spoke about careful management of taxpayer money and the requirement to avoid risk. And a representative from the California Community Banking Network (who also sits on the California Bankers Association board) spoke approvingly of the help the state of California currently provides to community banks.

Public comment was short, and very positive about public banking.

We find it notable that while every speaker was concerned with minimizing or eliminating risk and protecting public funds, the only speaker who actively disagreed with the concept of public banking came from the California Bankers’ Association. And when Assembly Member Limón asked him if the banks were willing to engage in self-reflection about why so many Californians are dissatisfied with the current state of banking, all he could say was “We’re willing to learn more about that.” And he heard some answers in public comment, such as “stop investing in fossil fuels” and “stop prioritizing shareholders and profits over the people who are giving you their money to handle.”

***

In the immediate wake of our positive experience in Sacramento, the San Francisco Board of Supervisors unanimously passed a resolution calling on the Sacramento legislators to pass a resolution clearing the way for the Department of Business Oversight to give charters to public banks.

https://publicbankeastbay.org/2019/02/06/sacramento-lobbying-san-francisco-support/