By Steven Tavares.
Oakland officials are putting a down payment on the possible creation of a public bank. The Oakland City Council Finance and Management Committee approved the allocation Tuesday of $100,000 to study the feasibility of the potentially landmark public bank in Oakland, or possibly regionally.
The proposed public bank would give Oakland residents in underserved areas a viable option for seeking mortgage and personal loans. It’s a response to the lack of interest from Big Banks to provide mortgage loans to minorities in Oakland.
The committee approved the item, 3-1, with Councilmembers Abel Guillen, Dan Kalb, and Anne Campbell Washington voting yes, and Noel Gallo voting no. The resolution heads to the non-consent portion of the full city council’s June 20 agenda.
But proponents also say a public bank gives the city’s cash-based cannabis industry an ability to participate in the banking system. Since the federal government still considers commerce in cannabis illegal, many banking institutions are wary about opening accounts for such businesses.
The issue was put on hold during a committee hearing on April 25 after some councilmembers voiced skepticism over whether the amount was a sufficient outlay for the consultant Global Investment Company of Oakland to perform the scope of work needed to conduct the feasibility study. Those concerns, though, have subsided.
“While I don’t think problems are going to be solved by this public bank and I think there’s a lot work ahead,” said Guillen. “I think it’s worth Oakland’s investment to start the conversation and to figure out ways in which Oakland’s local dollars can be invested more strategically and more locally.”
Councilmember Rebecca Kaplan, who is a co-author of the resolution, but not a member of the finance and management committee, testified, “Fundamentally, we lack adequate services in terms of financial services that are focused on the needs of the community.”
Kaplan added the continuing debate on the creation of a regional public bank should be viewed through the same lens that led Oakland and a number of East Bay cities recently form the Community Choice Aggregation program that gives local control for the purchase of clean and renewable energy.
As other municipalities join Oakland’s effort to create a public bank, they will help defray start-up costs down the line, Kaplan told the committee. “It is our hope and belief that other cities would share in the next step.”
Maintaining an equal, two-pronged focus on Oakland, but also a regional public bank going forward, was adamantly urged by Kalb, who requested specific language in the resolution on the matter.
Gallo, in voting no, said he supports the overall idea of a public bank, but not the process the city is proposing. He again suggested Tuesday that private interests in the cannabis community, instead, pay for the feasibility study.