California cities could open their own banks under bill backed by Democratic lawmakers

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.