By Steven Tavares.
The momentum for Oakland becoming only the second public bank in the entire country was slowed Tuesday when an Oakland City Council committee declined to support a feasibility study worth $100,000.
A majority of the Finance and Management Committee strongly questioned whether the proposal recommended by city staff was sufficient to conduct a thorough study that also includes additional information for a regional or countywide public bank.
The committee also said funding avenues for a public bank should be included in the city’s upcoming budget deliberations that begin in earnest next month. Rather than move the item to the full council or register a no vote, the committee directed city staff to further study the proposal’s scope of work in time for the June 13 finance committee meeting.
Oakland Councilmember Dan Kalb, similar to all four committee members, expressed support for the general concept of a public bank, but he questioned whether the large scope of the feasibility study in relation to its relatively small price tag would be adequate. “If that is what it is, then great,” he said.
Cathy Jackson-Gent, the CEO of Oakland-based Global Investment Company, one of two companies that responded to the city’s Request for Proposal, and the firm recommended by city staff, assured the committee their feasibility study would require no additional expenditures.
Oakland Councilmember Anne Campbell Washington also questioned whether $100,000 was enough to perform a suitable study. But, Washington and other councilmembers said the timing of the expenditure is not right, bearing in mind, the city is about to begin reconciling how to close an expected large budget shortfall in coming months.
Although city staff recommended the committee select Global Investment Company to perform the study, it also encourage them to hold off until the next fiscal year budget is composed. Next year’s budget must be approved before June 30.
“Taking on this project at this time when I’m tying to argue with my neighbors about what my priorities are in terms of a budget,” said Oakland Councilmember Noel Gallo, is sending the wrong message. Gallo, added, “The goal and the intent I can support, but not the funding source at this time.”
The idea of a public bank in Oakland arose from a few differing factors, including the banking industry’s decades-long history of denying all types of loans to minority groups in the city and the inability of its burgeoning cannabis industry to obtain banking services due to the federal government’s prohibition on cannabis. Currently, the city and state’s cannabis industry is awash in revenues, but largely a cash-only enterprise. The only other public bank resides in North Dakota.
Gallo suggested whether it might be in the cannabis industry’s best interests to fund a public bank feasibility study on its own. Washington, later, expressed a similar sentiment.
Yet, attaching the proposed public bank to just Oakland, may be a misnomer with several councilmembers envisioning greater economies of scale by incorporating other East Bay municipalities.”This issue is greater than Oakland,” said Oakland Councilmember Abel Guillen. “It’s an economic justice issue that involves in the entire region, and not just Oakland.”