Public Bank News: Oakland and More

Councilmember Kaplan Reports on Oakland Public Banking Forum

Our February 9 Public Banking Forum at Oakland City Hall was a huge success with overflow crowds, great speakers, and lots of audience questions. We’re receiving many requests for more information and how to volunteer. To get involved, click here.

Oakland Councilmember At Large Rebecca Kaplan emceed the evening. Here is her post-event wrap-up.

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Last night I along with the Friends of the Public Bank hosted a full house at City Hall for a Public Banking forum.

The forum featured public banking experts from across the United States, all of whom support the goal of developing socially responsible financial institutions, that are responsive to the needs of the local community, and help save money for tax payers.  In Oakland, a public bank could also help solve the problem of access to banking with the strong and growing cannabis industry.

Last November, I initiated Oakland’s public banking effort by authoring a Resolution calling on city staff to research the costs of a feasibility study of a public bank for the City of Oakland and/or the larger region (in partnership with other cities). A status update on the feasibility study, which is co-sponsored by myself and Councilmember’s Kalb and Guillen, is scheduled to return to the Finance Committee on February 28th, which commences at 9:30am in Hearing Room 1. (To read the Resolution, click here.) Click here for a map to Oakland City Hall.

In introducing the forum last night, I voiced to those in attendance that creating a bank that is accountable to the community is one of the ways we can put our money where our mouth is, fund needed projects, and invest in accordance with our values. We can protect our cannabis community by not forcing them to use cash transactions, and, like our recent successful efforts to create Community Choice Energy, we can harness local community support to take action that improves the environment, public health, and the local economy.  As distrust in big corporate banks and lack of oversight at the Federal level are growing problems — this is how we can be part of the solution.

Since the financial crash of 2008-09, there has been an uptick in efforts to create public banks at the state, county, and city level. These efforts are borne out of many reasons, including a demand for socially responsible investments and dealings within the community and the environment.

Nichoe Lichen, a lead advocate for public banking in Santa Fe, New Mexico and a panelist last night, says, “The goal of a feasibility study of a public bank, is ultimately to receive a bank charter.”

When public banks are chartered, they can fund locally needed projects, directly give back to its community, and uphold its social responsibility, including for projects such as affordable housing and offering direct lower interest loans.

Panelist Marc Armstrong, President of Commonomics USA and co-founder of Public Banking Institute, says that a public bank will increase economic development, “…it is important when a financial institution is funding their values, and how do you implement your values? You fund them!”

“Instead of seeking to regulate the financial institutions that we already have, why not create one with credible ethos. Start the institution that way and not the other way around.” says Tom Sgouros, author of Checking the Banks and former senior advisor to the Treasurer of Rhode Island.

Currently, the permitted cannabis industry is not able to utilize banks due to Federal regulations, therefore, forcing the exchange of cash for all transactions, including when paying their taxes.

“Not allowing the industry to use banks creates multiple problems with the law. Think about having to only use cash. This creates a healthy environment for unfortunate events to happen, and there are unnecessary targets for crime and harm.” says panelist Henry Wykowski who is the lead attorney for Harborside Health Center dispensary and also worked as a past federal prosecutor.

Also in attendance as a panelist was Mayor of Berkeley, Jesse Arreguin who said, “Berkeley, Oakland, and the Bay Area need to lead the way to move our country forward, especially under the Trump administration.” Arreguin also stated that there needs to be a financial institution that is socially responsible which will serve the needs of the community, including affordable housing, allowing the cannabis industry to bank, and divest from the Dakota Access Pipeline and the prison industry.

Thank you

Elizabeth Warren on Cannabis and Banking

s.e. smith has a fine article at Truthout about Senator Elizabeth Warren’s support for cannabis access to banks:

If the question of whether your friendly neighborhood cannabis cooperative can access the bank doesn’t seem pressing to you, consider this: In 2016, the industry pushed $7 billion in sales — and much of that money was processed in cash transactions.

Only around 300 banks offer services to marijuana-based businesses because they occupy a strange regulatory limbo that makes them risky customers. Warren and some of her cohorts want to change that.

While “marijuana-based business” may trigger a mental image of a dispensary or head shop, the industry is much, much larger than that. It includes growers and facilities that produce a variety of marijuana products like tinctures, extracts and edibles, along with the companies that supply equipment to those operations.

We believe that public banking is one solution to this social problem, which smith describes in some detail at the link. Cannabis cash is also one solution to capitalizing public banks.

Vermont Introduces Public Bank Legislation!

State Representative Brian Cina and State Senator Anthony Pollina have introduced a public banking bill in Vermont’s state legislature  that is being submitted to the legislature to create a commission to establish a statewide public bank in Vermont. The bill would establish a commission “charged with designing a results-based public banking model.”

Help Us Grow Our Network!

Oakland and the East Bay are rich with organizations and groups who would support a public bank. We have a starting list of supporters, but we want lots more!

If you know an organization (or more than one) that you think would sign a letter of support, encourage its members to come to the Forum, and join us in other ways, you can enter its information here.

If you would be willing to help us reach out to them (we’ll give you materials), put your name in the “FBPO Liaison” column, and make sure we have your contact info.

Every additional name on this list brings us closer to The Public Bank of Oakland!

Our Own Susan Harman at Oakland’s January 4 Housing Forum

Susan discusses the advantages of The Public Bank of Oakland!

Thanks to TDL on Twitter for doing such a great job reporting on and recording Oakland meetings!

Op-Ed Lays Out Details for Santa Fe Public Bank

Christmas Eve brought us a new op-ed supporting the effort to create a Public Bank of Santa Fe.

Brass Tacks Team learned from Santa Fe’s 2011-15 Comprehensive Annual Financial Reports and debt service documents that Santa Fe spent $7 million in bond issuance costs and fiscal agent fees, and will pay $25 million in interest to Wall Street. If Santa Fe had had a public bank that refinanced that debt at 4 percent, its debt service costs would have been reduced by $282,425 and total debt by $52,439,584.

Though a public bank’s mission can expand over time, the immediate need is for financing (or refinancing) public projects. This is a much simpler, lower risk model than the partnership model described in the Building Solutions study. A public bank that finances infrastructure can support economic development, substantially lower city costs and debt, and return a share of profit from those loans to the city.

Check out the “Five Year Model” for starting a small chartered public bank that funds public projects. Learn why we call it a “Debt Reduction, Budget Easing, Income Generating Strategy for the City of Santa Fe.”