Category: CalAccount


Governor’s Budget Blueprint Affirms California’s Commitment to Closing Financial Services and Racial Wealth Gap

Sacramento, CA – Members of the community coalition supporting the CalAccount program applauded Governor Newsom’s focus on ensuring all Californians have equitable access to financial services in the May Revision Budget proposal presented on May 13th for fiscal year 2022-23.

The May Revision budget allocates $4 million to complete the market analysis, the first step in the creation of the CalAccount program as required by the California Public Banking Option Act, AB 1177 (Santiago), signed into law in 2021. CalAccount guarantees all Californians a no-fee, no-penalty debit account, with no overdraft fees, no minimum balance requirement, automatic bill pay capacity and free ATM access at participating banks. After approval by the legislature, the CalAccount program would partner with financial institutions to close the widening wealth gap fueled by the exclusion of low-wage communities from basic banking services.

One in four California households are unbanked or underbanked, meaning they lack a bank account or pay a high price for basic financial transactions like cashing their paycheck.

Seventy-eight percent of unbanked households make less than $30,000 annually and 42% make less than $15,000 annually. Nearly half of all Black-identifying households and Hispanic-identifying households in California are unbanked or underbanked.

Assemblymember Miguel Santiago (D-Los Angeles), author of the California Public Banking Option Act,

“Thank you to Governor Newsom and Treasurer Ma for recognizing the urgency of analyzing a public banking option. This investment in the CalAccount market analysis will move California one step closer to providing public banking – no-fee, no-penalty banking – to all who want it. I look forward to working with the Legislature to ensure this funding is in the final budget.”

Glenis Murillo, a McDonald’s worker and leader in Fight for 15 and a Union,

“Free banking services make sure that Californians like me will be able to use our hard-earned dollars for food and rent, instead of paying banking fees. Too many Californians are living paycheck to paycheck but are having to pay hundreds of dollars each year just so that we can keep our bank accounts open. We are being penalized for being poor.”

Paulina Gonzalez-Brito, Executive Director, California Reinvestment Coalition,

“The state budget serves as a reflection of Californian’s priorities. The May budget revision affirms Gov. Newsom’s commitment to leveling the playing field and increasing opportunities for Black and Brown communities to participate in a financial system from which they’ve been historically excluded. We applaud Gov. Newsom’s decision to allocate resources to the California Public Banking Option Act, which should serve as a national model for other states looking to provide universal access to basic financial services.”

Trinity Tran, Lead Organizer and Political Director, California Public Banking Alliance,

“This is a major step for universal banking access which will be life-changing for millions of Californians facing barriers to basic banking from high-costs and predatory fees. With the $4M budget allocation, we hope to see CalAccount’s market analysis completed by 2023, enabling this vital program to move forward without delay.”

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California could soon have its own public banking service, under new law signed by Gavin Newsom

The Sacramento Bee – October 4, 2021. California set a course to offer the nation’s first zero-cost, public option platform for personal financial services, under a new law signed by Gov. Gavin Newsom. Assembly Bill 1177, authored by Assemblyman Miguel Santiago, D-Los Angeles, calls for the state to conduct a market analysis of a state-backed program that would give Californians a public option for banking services like debit cards. The study would aim to determine with that service would be viable within six years. The commission must complete the analysis by July 1, 2024. Then, the Legislature could decide whether to launch a public banking program.

Black and Latino families are more likely to lack access to commercial banks than white and Asian households, a trend that Santiago aims to reverse with a public bank. “Creating a public option for banking and closing the racial wealth gap isn’t only a moral imperative, but is necessary to foster greater financial security for all of our communities. This bill is a much-needed step to address the needs of the unbanked and underbanked and moves us closer to building a more equitable economy after the pandemic,” Santiago wrote in a statement urging lawmakers to pass his bill.

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California Public Banking Option Act (AB 1177) Passes the State Legislature

September 10, 2021 – Rick Girling, Steve Sittig, Trinity Tran, California Public Banking Alliance.

Today the California State Legislature approved landmark legislation guaranteeing universal free banking access to all Californians. AB 1177 sets into motion the creation of the CalAccount program guaranteeing all California residents access to basic banking services without fees or penalties. The California Public Banking Option Act addresses the inequities in financial services acutely felt by communities that have been hardest hit by the pandemic and recession, inequalities such as discrimination, predatory lending, and vicious spirals of debt.

Californians are demanding banking reform because Wall Street banks have historically failed low-income communities of color. The State Legislature’s approval of AB 1177 paves the way for a banking system centered on people instead of profits. In just a few months, AB 1177 has garnered extraordinary support in the effort to assure that all Californians gain access to banking services. The California Public Banking Alliance, along with AB 1177 co-sponsors, SEIU California and the California Reinvestment Coalition, gained endorsements from over 230 labor, community, and environmental justice groups to extend financial services to unbanked and underbanked residents. This broad support paid off handsomely as the legislation moved through the State Legislature and now heads to the Governor’s desk.

A public option for essential financial services can replace exploitative alternatives to traditional banking, reducing the wealth gap and helping Californians to avoid catastrophic debt. As many AB 1177 supporters have explained, it’s very expensive to be poor. Minimum balance requirements, late fees, overdraft fees, higher interest rate charges for loans to the financially insecure, as well as check cashing and money order fees add up to substantial financial burdens placed on those least able to pay. As Mayron Payes testified to the State Assembly, “A lot of street vendors don’t have a banking relationship because of the high fees and couldn’t maintain the minimum balance. Many of them are operating on a cash basis and couldn’t open a bank account.” This law would provide a banking card to all residents who request one that will enable them to have access to free banking services essential to everyday living.

There is a broad basis of support for this needed financial reform. The state’s largest union, SEIU California with 700,000 members, is the primary proponent. Other labor unions such as the California Labor Federation and UFCW Western States Union have joined in. Community activist groups are showing strong support. Indivisible CA: StateStrong and chapters throughout the state are mobilizing their members to advocate for AB 1177. Environmental activists such as Friends of the Earth and Greenpeace International see the benefits of making financial services available to all.

California Public Banking Alliance (Co-Sponsor)
SEIU California (Co-Sponsor)
California Reinvestment Coalition (Co-Sponsor)
Action Center on Race and the Economy (ACRE)
Active San Gabriel Valley
Alameda County Democratic Party
All Rise Alameda
Alliance for a Just Recovery, Sonoma County
Alliance of Californians for Community Empowerment Action (ACCE)
Asian Pacific Environmental Network (APEN)
Asian Pacific Islander Small Business Program
Bay Area Regional Health Inequities Initiative (BARHII)
Black Arts Movement Business District Community Development Corp. of Oakland (BAMBD, CDC)
Bay Area-System Change Not Climate Change
Beneficial State Foundation
Building the Base Face to Face
California Asset Building Coalition
California Association for Micro Enterprise Opportunity (CAMEO)
California Coalition for Worker Power
California Community Land Trust Network
California Democratic Party
California Democratic Party Delegates — 204 Delegates
California Employment Lawyers Association
California Labor Federation, AFL-CIO
California Low-Income Consumer Federation
California Progressive Alliance
California River Watch
Center for Farmworker Families
Center for LGBTQ Economic Advancement & Research (CLEAR)
City and County of San Francisco
City of Berkeley
City of Burbank
City of Long Beach
City of Los Angeles
Climate Protection and Recovery Fund
Cloverdale Indivisible
CodePink Women for Peace
Committee for Better Banks
Communities for a Better Environment (CBE)
Community Financial Resources
Community RePower Movement
Consumer Federation of California
Consumers for Auto Reliability and Safety
Contra Costa Move On
Converging Storms Action Network
Cooperation Humboldt
Cooperative Center Federal Credit Union
Courage California
Culver City Vice Mayor Daniel Lee
DSA Ecosocialists
Democratic Socialists of America, San Francisco
Democrats of the Desert
Dreams for Change
Duende Consulting
El Cerrito Progressives
Feel the Bern Democratic Club, Los Angeles
Feel the Bern San Fernando Valley
Feminists in Action
Fight For 15
Fight for 15 LA
Fight for 15 NorCal
Fossil Free California
Fresno County Democratic Party
Friends Committee on Legislation of California
Friends of Public Banking Santa Rosa
Friends of the Climate Action Plan
Friends of the Earth U.S.
Green Lining Institute
Green Party Humboldt County
Green Party of Santa Clara County
Greenpeace International
Ground Game LA
Hanmi Bank
Haven Neighborhood Services
Hillcrest Indivisible
HOPE for All: Helping Others Prosper Economically
Housing and Economic Rights Advocates (HERA)
Hull Professionals
Inclusive Action for the City
Independent Indivisible
Indivisible 30/Keep Sherman Accountable
Indivisible 36
Indivisible 39
Indivisible 41
Indivisible 43
Indivisible 52
Indivisible Auburn
Indivisible Beach Cities
Indivisible CA -7
Indivisible California Green Team
Indivisible California: StateStrong
Indivisible East Bay
Indivisible Lorin
Indivisible Los Angeles
Indivisible Marin
Indivisible OC 46
Indivisible of Sherman Oaks
Indivisible Petaluma
Indivisible Sacramento
Indivisible San Bernardino
Indivisible San Diego — Persist
Indivisible San Francisco
Indivisible San Jose
Indivisible Santa Barbara
Indivisible Sausalito
Indivisible Sebastopol
Indivisible SF Peninsula and CA-14
Indivisible Simi Valley Porter Ranch
Indivisible Sonoma County
Indivisible South Bay
Indivisible South Bay LA
Indivisible Stanislaus
Indivisible Ventura
Indivisible Windsor
Justicia Digna
LA Forward
Lassen County Democratic Central Committee
Lawyers’ Committee for Civil Rights of San Francisco Bay Area
Liberty Tree Foundation for the Democratic Revolution
LITE Initiatives
Livermore Indivisible
Los Angeles Alliance for a New Economy (LAANE)
Los Angeles City Councilmember Kevin de León
Los Angeles City Councilmember Curren Price
Los Angeles City Councilmember Nithya Raman
Los Angeles County Democratic Party
Malonga Arts Residents Association
March and Rally Los Angeles
Marin Sunshine Realty
Mayor Pro Tem G. Muir Davis, City of La Verne
Mayor Robert Garcia, City of Long Beach
Mayor Tim Sandoval, City of Pomona
Mayor Jennifer Stark, City of Claremont
McGee-Spaulding Neighbors in Action
Media Alliance
Mendocino County Public Banking Coalition
Mendocino Women’s Political Coalition
Mill Valley Community Action Network
Mobility Capital Finance, Inc. (MoCaFi)
Mothers Out Front CA
Mountain Progressives
National Domestic Workers Alliance
NextGen California
New Economics for Women
North Bay Jobs with Justice
North Bay Labor Council
Northridge Indivisible
Occupy Sonoma Valley
Orchard City Indivisible
Orinda Progressive Action Alliance
Our Revolution Long Beach
Partnership for Working Families
Peace and Justice Center of Sonoma County
People for Public Banking Central Coast
PODER (People Organizing to Demand Environmental & Economic Rights)
Pomona City Councilmember John Nolte, District 1
Progress Noe Valley
Progressive Alliance of the Inland Empire
Progressive Asian Network for Action (PANA)
Prosperity Now
Public Bank East Bay
Public Bank Long Beach
Public Bank Los Angeles (PBLA)
Public Bank Pomona Valley
Public Banking Institute
Public Counsel
Public Law Center
Ready to Help LA
Renaissance Entrepreneurship Center River Watch
Romero Institute
Rose Foundation for Communities and the Environment
San Diego County Democratic Party
San Fernando Valley Young Democrats
San Francisco Berniecrats
San Francisco Board of Supervisors
San Francisco County Treasurer José Cisneros
San Francisco Public Bank Coalition
San Francisco Supervisor Dean Preston
San Jose Nikkei Resisters
San Mateo Labor Council
Sanctuary Santa Cruz
Santa Cruz Climate Action Network
Santa Cruz County Democratic Party
Santa Cruz Indivisible
SEIU 1021
SEIU 721
SEIU International
SFV Indivisible
Shoreline Study Center
Silicon Valley Rising Action
Sister-to-Sister 2
SoCal 350 Climate Action
Social Eco Education
Sonoma County Climate Activist Network (SoCoCAN)
Sonoma County Climate Mobilization
Sonoma County Democratic Party
Sonoma County Pachamama Alliance
South Bay Progressive Alliance
South Sacramento Seniors for Systemic Equality
Southern Poverty Law Center
Strategic Actions for a Just Economy
Strike Debt Bay Area
Sunrise Movement LA
Tehama Indivisible
Thai Community Development Center
The Climate Center
The Cobb Institute
The Future Left
The Greenlining Institute
Together We Will — San José
Together We Will Contra Costa
Together We Will/Indivisible — Los Gatos
UFCW (United Food and Commercial Workers) Western States Council
UFCW Local 5
UFCW Local 770
United Farm Workers
UXO Architects
Vallejo-Benicia Indivisible
Venice Resistance
We The People SD
Western Center on Law & Poverty
Wild Solar
Wilshire Center Koreatown Neighborhood Council
Women For: Orange County
Women’s Alliance Los Angeles
Working Group for Emergency Climate Action Now
Working Partnerships USA
Yolo Indivisible
350 Butte County
350 Chico
350 Conejo / San Fernando Valley
350 Marin
350 Silicon Valley
350 Sonoma
350 South Bay Los Angeles

Assemblymember Miguel Santiago, author
Assemblymember David Chiu, author
Assemblymember Ash Kalra, author
Assemblymember Alex Lee, author
Assemblymember Wendy Carillo, author
Assemblymember Eduardo Garcia, author
Assemblymember Mike Gipson, author
Assemblymember Lorena Gonzalez, author
Assemblymember Adrin Nazarian, author
Assemblymember Phil Ting, author
Assemblymember Buffy Wicks, author
Senator Maria Elena Durazo, co-author
Senator Ben Hueso, co-author
Senator Lena Gonzalez, co-author
Senator Josh Newman, co-author
Senator Scott Wiener, co-author
Assemblymember Laura Friedman, co-author
Assemblymember Luz Rivas, co-author
Assemblymember Reggie Jones-Sawyer, co-author

Originally posted on the California Public Banking Alliance’s Medium page.

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Assembly Votes To Guarantee All Californians Free Basic Banking Services

Sacramento, CA – Today, the California State Assembly approved landmark legislation that would guarantee all Californians access to basic banking services without fees or penalties. The California Public Banking Option Act, AB 1177 (BankCal), addresses the inequities in financial services acutely felt by communities that have been hardest hit by pandemic and recession: discrimination, predatory lending, and vicious spirals of debt. AB 1177 is endorsed by SEIU California, California Reinvestment Coalition, California Public Banking Alliance, and 200 racial and economic justice groups, faith-based and climate justice organizations, businesses, and labor unions.

“Struggling families are hit by fee after fee at every corner, and BankCal will help them keep their hard-earned dollars for food and rent,” said Assemblymember Miguel Santiago, lead author of AB 1177. “Providing a public banking option for essential financial services will help close the racial wealth gap. AB 1177 is a key tool to social and economic mobility, and I’m excited to continue pushing to pass this bill in the Senate.”

“We applaud the Assembly for supporting this bill and ensuring access to financial services for all Californians regardless of how much money they make, their zip code, or the color of their skin,” said Bob Schoonover, SEIU California President and SEIU 721 Executive Director. “Limited access to basic banking services like check cashing are a problem that disproportionately impacts low-income communities and communities of color. BankCal is a concrete step in making sure that everyone has the opportunity to recover and come back stronger from the devastation caused by the pandemic.”

Seventy-eight percent of unbanked households make less than $30,000 annually and 42% make less than $15,000 annually. Nearly half of all Black-identifying households and Hispanic-identifying households in California are unbanked or underbanked.

“Today’s vote advancing BankCal, moves the state closer to being on the right side of history,” said Paulina Gonzalez-Brito, Executive Director of the California Reinvestment Coalition. “AB1177 carries with it the potential to finally build an alternative to the extractive and exclusive Wall Street banking system that has failed historically low-income communities and Black, Indigenous, People of Color. A banking system that centers people instead of profits is a start toward addressing long-standing racial and economic inequities in the state.”

“Today’s Assembly vote in support of BankCal affirms that banking services are essential in allowing full participation in our economy–it is a necessity, not a luxury,” said Trinity Tran, lead organizer of the California Public Banking Alliance. “The Assembly’s passage of AB 1177 comes at a critical moment for struggling Californians and advances the movement toward a more equitable banking system.”

AB 1177 is modeled from the success of CalSavers and CalKids, similar programs aimed at creating greater financial stability for working families. To study the most effective and efficient way to operate the BankCal program, AB 1177 requires a market analysis. Upon completion of the market analysis and approval by the Legislature, AB 1177 establishes the BankCal program.

The BankCal program would allow Californians to create a BankCal account, use a BankCal debit card, deposit funds, automate bill pay, and set up direct deposit without fees or penalties.

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A Bank Without Penalties And Fees? An Assembly Bill Aims To Help Low-Income Californians

LAist – Millions of low-income Californians might be able to bank free of penalties and fees if state lawmakers approve the latest attempt to create public banking.

AB 1177 would form a state-supported public bank board, which would partner with private banks to offer the free accounts. The program would be called “BankCal.”

“If a rich person earns money, that money makes money,” said State Assemblymember Miguel Santiago (D-LA), the bill’s author. “When a poor person earns money, that money is gouged from every corner you could possibly get it. You get gouged when you go to payday lendings, you get gouged at the banks. You get gouged on every transaction and every fee.”

The California Public Banking Alliance sponsored the measure. Co-founder Trinity Tran said the bill would help bridge the racial wealth in underserved communities:

“Because when poor folks have to pay for their financial services, that means they have fewer opportunities to grow credit, they’re rejected for loans, and that all amounts to a real disadvantage for millions of families.”

Gov. Gavin Newsom signed a bill in 2019 to allow independent municipalities to create their own public banks, but this would create a state-backed banking system.

Correction: A previous version of this article stated that previous California bills allowing public banking option failed. Actually, Newsom signed a bill years ago to allow independent municipalities to create their own public banks.

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Free banking in California? New bill tackles access and racial equity

By Margot Roosevelt, Los Angeles Time.

Escalating overdraft charges. Minimum balances. High ATM, check-cashing and debit card fees.

Banking can be expensive, especially for low-wage workers.

A score of California lawmakers have signed on to a new bill designed to offer Golden State households free financial services, taking on the state’s powerful banks at a time when easier access to banking services could help families cope with the economic fallout of the COVID-19 pandemic.

If it passes, the California Public Banking Option Act would create BankCal, the first state government program in the nation to offer universal consumer banking, according to financial policy experts. The program would provide no-fee debit cards, direct deposits from employers and government agencies, electronic bill payment and ATM access, directly competing with private banks.

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