By Robert R. Raymond, Truthout. It may not come as a surprise to hear that the majority of Americans don’t trust the banking system in this country. Only 27 percent of those surveyed in a 2016 Gallup poll said they had “a great deal” or “quite a lot” of confidence in the institution — less than half of the record high set in 1979. And the lack of trust is spread relatively evenly across the political spectrum — it’s not just liberals or those on the left: Almost everyone is fed up with the banks.

And if banking institutions don’t exactly spark joy, their lead characters — morally bankrupt investment bankers whose greed and arrogance almost singlehandedly collapsed the entire country’s economy — certainly don’t spark joy either. It’s an old story: Bankers made obscene amounts of money destroying the economy, we bailed them out, they walked away from it all without a shred of accountability and there’s nothing anyone can do about it. But that’s not where the story has to end. Spurred by the need for an alternative to the for-profit, extractive model of finance exemplified by Wall Street, there is a budding movement in the United States that is working to reimagine banking as an institution that truly serves the public.

Public banking is an old idea, but it has never been very common in the United States. The first and only public bank in the country was founded exactly 100 years ago in North Dakota, and it wasn’t until relatively recently that the idea has begun to find new life in cities and states across the country. Growing largely out of the need for more democratic ownership over capital, the aim of this budding movement is to create a robust public banking infrastructure across the nation that is rooted in the principles of economic, environmental, racial and social justice.

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By Chase DiFeliciantonio, North Bay Business Journal. A bill that would allow some municipalities to establish their own banks in California edged through a state committee Wednesday.

The legislation, Assembly Bill 857, passed the Senate Governance and Finance Committee on a 4-3 vote with the support of Chairman Mike McGuire, D-Healdsburg.

Authored by Assemblymen David Chiu, D-San Francisco, and Miguel Santiago, D-Los Angeles, the bill would allow local governments of a certain size to create publicly owned banks with the goal of divesting from large banks invested in the fossil fuel industry, private prisons, and other industries while investing local tax money back into communities.

Municipalities could also band together to create joint powers authorities under the bill.

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North Bay Business Journal talks with California Public Banking Alliance members Chris Petlock, Shelly Browning and Susan Harman.

Should banks exist to make a profit, a difference, or both?

A bill in the California Legislature allowing municipalities to create their own banks could upend how they handle their money and finance long-term projects. It also has the potential to squeeze out larger financial institutions, replacing them with these so-called “public banks.”

The legislation, Assembly Bill 857, could also have a resounding impact on the North Bay.

Cities and counties could combine to found a bank that would replace larger institutions in underwriting “participation loans” made to projects in partnership with local banks and credit unions, according to Susan Harman of the Public Bank East Bay advocacy group, part of the statewide California Public Bank Alliance.

“We would replace Wall Street banks, offer local rates and the money would stay local,” Harman said. “The public bank would buy that loan essentially, back it, and provide the capital that the credit union or community bank would need.”

There are different visions for how public banks could work and how many municipalities would be involved in one. In the North Bay, some advocates envision a wide-ranging conglomeration of cities and counties participating in the bank.

Under the bill, municipalities could band together to create joint powers authorities, or JPAs, to increase their size and improve the chance of loan profitability.

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Beverly Press. The Public Banking Act, AB 857, passed its first hurdle in the California Senate on June 19. The measure passed through the Senate Banking Committee and now heads to the Senate Governance and Finance Committee.

Assemblyman Miguel Santiago (D-Los Angeles) said AB 857 has the broad support from labor unions, environmental groups, grassroots activists and municipalities throughout the state, though it’s up against heavy opposition from Wall Street banks.

“Wall Street bankers hate the idea of a public bank because it takes power away from them and gives it back to the people,” Santiago said. “AB 857 gives us the option to invest public dollars for the public good, and I say it’s high time we prioritized the people of California over the profits of billionaire investors.”

Assemblyman David Chiu (D-San Francisco) said the state is “standing up to say the public’s money should be used for the public good.”

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By Tom Gogola, Pacific Sun. There’s an effort afoot in Sacramento for public banking that’s putting the focus on how localities manage their investment portfolios. A bill that’s currently parked in a Senate committee chaired by North Bay legislator Mike McGuire would, for the first time, allow municipalities or regions to create commercial banks that would function in much the same way as Wall Street banks like JP Morgan Chase and Wells Fargo.

Assembly Bill 857, authored by Assemblymen David Chiu and Miguel Santiago, sets out to create a regulatory framework to allow California to license public banks that would give cities the option to stop doing business with big banks and invest taxpayer money into local communities.

“We don’t have control over our own money supply,” says North Bay public banking activist Shelly Browning, who’s a longtime public bank activist. Her road to advocacy for public banking leads from Egypt’s Freedom Square protests, to the domestic Occupy movement, to the spring-off Occupy effort to get public banks in the public consciousness.

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By Scott Soriano, Capitol Weekly. The concept of public banking in California is making a comeback.

By law, currently California cities and counties typically have one place to deposit the funds they collect from taxes, fees and fines: private commercial banks. Billions of dollars of public money are handled by commercial banks — for a fee.

Despite having billions of dollars banked, municipalities have no say in how their money is used by commercial banks. Bank management, owners and stockholders set policy.

But public banking advocates say that because commercial banks are loyal to their shareholders, that policy reflects the shareholders’ desire for high profit, not the interests of the community whose money they bank.

Last month, the Assembly on a bare majority vote approved AB 857, by Assembly Democrats Miguel Santiago of Los Angeles and David Chiu of San Francisco. The measure amends existing banking law to allow California municipalities to establish their own public banks. The bill was sent to the Senate, where the Banking & Financial Institutions Committee approved last week and sent to it to Governance and Finance.

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San Jose Inside talks to California Public Banking Alliance organizer Jake Tonkel with South Bay Progressive Alliance.

Silicon Valley Bank opened in 1982 to serve startups shunned by big lenders, which saw the fledgling tech sector as innately risky. But Roger Smith and Bill Biggerstaff, the Wells Fargo defectors who founded the small bank with Stanford University professor Robert Medearis, had deep roots in the derring-do culture that would transform Santa Clara Valley into the world’s innovation capital.

Now with more than $60 billion in assets, Silicon Valley Bank long ago outgrew its provincial status. Still, those early days wove it into a rich tradition of community lenders that make decisions based on nuanced understanding of specialized markets and close relationships with borrowers.

Small banks have since become an endangered breed.

Once awash in neighborhood lenders and credit unions, the South Bay has lost the vast majority to mergers and acquisitions. Beloved local brands such as Saratoga National Bank, Peninsula Bank, San Jose National Bank and the Bank of Santa Clara gradually consolidated out of existence. Cupertino National Bank and Mid-Peninsula National Bank were rolled up into Greater Bay Bancorp in the 1990s. In 2007, the 41 Bancorps branches were slurped up by Wells Fargo. Borel Private Bank & Trust was sold to Boston Private Bank. CEFCU of Peoria, Illinois, acquired Valley Credit Union. The list goes on.

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Bohemian.com talks with Friends of Public Banking Santa Rosa organizer and Alliance member Shelly Browning. PQ: “The activities of the top big banks in fossil fuels and many other activities gives us limited, to no options regarding large, socially responsible banking options. We are truly stuck between Scylla and Charybdis until a public banking option is available.”

Too Big? Public bank advocates want to see cities invest in Main Street, not Wall Street.

For Shelly Browning, it’s been a long road from the Arab Spring to the Occupy Movement to Santa Rosa’s support of a public banking bill now under consideration in Sacramento. Browning’s a Santa Rosa small-business owner who’s been active on the public banking front for years and says her inspiration to get Santa Rosa to divest from Wall Street banks begins in Cairo’s Tahrir Square—and ends, perhaps, with an eventual “North Coast” public bank that would exist alongside Chase and other Wall Street banks.

She’s been meeting with city leaders to raise awareness of the public banking bill. Browning was moved, she says, by the small-businessman who was arrested in Tunisia for failing to have a permit in 2011, and whose suicide sparked protests in Egypt that then gave rise to the Occupy moment in the United States. The economic forces that gave rise to Tahrir Square are the same that are driving the push for public banking: All roads lead to Wall Street, while Main Street gets crushed.

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A California bill that would allow San Francisco to open a city-run bank cleared a key state Senate committee on Wednesday.

Assembly Bill 857 paves the path for local jurisdictions to launch a public bank, which San Francisco and other California cities have been exploring for more than a year. It’s been urged forward by the idea to take the city’s $12 billion budget out of major banks that are known to invest in things like private prisons and oil companies and invest in issues like affordable housing, renewable energy, and low-interest student loans.

“The public’s money should serve a public purpose, not line the pockets of Wall Street investors,” said Assemblymember David Chiu, who represents San Francisco and introduced the bill in March. “Time and time again, we have seen big banks invest billions of dollars of our money in institutions most Californians are opposed to.”

Continue reading on SF Weekly.