San Francisco is on track to create the first municipal bank in the nation after the city’s Board of Supervisors unanimously passed a business and government plan on Tuesday.
With the board’s go-ahead, San Francisco is permitted to start implementing its own publicly owned financial corporation, which would then be converted into the city’s first public bank.
Supervisor Dean Preston said the plan comes as the city continues to recover from economic hardship brought on by the COVID-19 pandemic. He added that traditional private banking has “failed” San Francisco residents and small businesses from accessing equitable financial services, especially for communities of color.
“As we continue to chart a path to economic recovery and a sustainable economy, the plans approved today provide a road map for our city to create the first municipal public bank in the country, a crucial strategy to ensure that our city funds are used to reverse inequities, not perpetuate them,” said Preston.
This plan has been over a year in the making, said Preston’s office. A working group of community leaders, public bankers, financial experts and small business owners have been collaborating on finding a path forward that considers both inclusive economic development and strategic operations and management.
Supervisor and Budget Committee and Local Agency Formation Commission Chair Connie Chan said the public bank could serve as a “green and equitable alternative to big banks.”
“Our investment in the public bank protects the future of our local economy and the financial interests of San Franciscans,” said Chan. “We will continue to build on this momentum until we get this done.”
Jackie Fielder, co-founder of the San Francisco Public Bank Coalition, said federal funding under President Joe Biden’s Inflation Reduction Act provides a “rare opportunity” for the city to take action on implementing the first public bank in the U.S.
“It’s crucial we move immediately on these plans and establish a green bank,” said Fielder.
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