The San Francisco Board of Supervisors voted 9-2 Tuesday to place a measure on the November ballot that would be a step towards creating the first city-run public bank in the country.
A public bank would let the city issue low-cost loans to affordable housing developers, small businesses, green infrastructure projects, and other entities that struggle to get loans from traditional banks.
“We can build a public bank that prioritizes reinvesting back into what we all need to sustain our local communities,” said Supervisor Chyanne Chen, who sponsored the measure. It will appear on the Nov. 3 ballot and requires over 50 percent of the vote to pass.
Supervisors Stephen Sherrill and Alan Wong were the two dissenters.
“A public bank involves decisions about deposits, lending, credit regulation, and risk management. Those decisions carry real financial consequences. They demand institutional discipline, insulation from political pressure, transparency, and deep banking expertise,” Wong said. “Our city’s track record shows that meeting those demands is harder than it sounds.”
It is unclear whether Mayor Daniel Lurie will support the measure.
Professional bankers would be hired to administer the bank. Though they are rare in the United States — the only one that currently exists is the Bank of North Dakota — they are common worldwide.
This November ballot measure is a first step: It would create the governance structure for a “municipal finance corporation,” an entity that would eventually turn into a public bank. For the bank to actually start functioning and dispersing loans, about $325 million in start-up money is needed.
After that, the bank would be self-sustaining.
On Feb. 3, Supervisor Jackie Fielder, a longtime proponent of the public bank, introduced a ballot measure that would have taxed certain financial institutions to fund the bank. That measure was withdrawn in March, and Fielder co-sponsored Tuesday’s measure.
It is possible that the bank could get funding through sources other than a local tax — the 2022 Inflation Reduction Act created grants for green finance institutions, for instance.
Supporters of the public bank are celebrating, calling it the product of years of advocacy. In 2019, California passed a state law allowing cities to create public banks. San Francisco then convened a Reinvestment Working Group, which in 2023 presented a plan for how the city could actually create such a bank.
“This is monumental,” said Misha Steier, spokesperson for the San Francisco Public Bank Coalition. “The S.F. Public Bank will put people over profits to invest in what we all need — affordable housing, infrastructure, local small business, and green energy.”
Genuine question, what does this achieve? You got on the ballot, let’s assume it passes. What’s next? Who benefits? Why use this over the plethora of banks available? Delusion that no existing bank serves people well?
You did not read the article Jack.
So one of the most corrupt city administrations in the country wants to start a bank, eh? I can’t imagine anything going wrong with this.
Let’s face it.all Jackie Fielder’s interested in is getting a cushy seat on the bank’s board.
Alan Wong hits the nail on the head. Only thing to add is how the typical public bank around the world is not in the business of supporting bleeding-heart causes. She maintains underwriting standards and controls just like any other bank does.
Another slush fund. Just what we need.
The public bank is just a guise to fund their pet cronies with cheap loans paid by SF citizen’s. The last thing S.F. needs is a distraction from the pressing issues.
Ms. Fielder, now your back from ‘looking after yourself on the public dime’ for a few months PLEASE DO YOUR JOB and start addressing the biggest problems in your district: 16th & Mission, and 24th & Mission Bart plazas. This should be your #1 issue to resolve… or do you not want to address the real issues? Easier to ‘create a distraction’ than address the real problems…. Easier to spend other people money than to actually take risks to make it.