Public Banking: Oakland, New Mexico, California and more

Here in Oakland, we’ve been attending the budget meetings of all the City Councilmembers and making our case for funding the public bank feasibility study now. One of our key messages is that the city is throwing away $200,000 a day for every day we don’t have a functioning public bank. This number is based on the $70M of savings profit the bank would generate per year, which in turn is based on roughly 50% of what the Bank of North Dakota generated this year, as Oakland’s budget is about half the size of North Dakota’s

Here we are, speaking at Councilmember Kalb’s budget hearing on May 13:

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Meanwhile, outside of Oakland, the Santa Fe, New Mexico City Council has voted unanimously to set up a public bank task force! All kudos to our allies at Banking on New Mexico, who made this happen.

And on May 20, at the California State Democratic Party Convention, candidate for governor Gavin Newsom gave a rallying cry for a public bank in California:

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Oakland councilmembers: If you want to be first, you’d better get moving!

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.”