Public Banking is the ONLY way for cities such as San Francisco and Seattle to fully divest their bank accounts from fossil fuels.
We are pleased that Public Bank Santa Rosa work group (formerly North Coast Public Banking - NCPB) moved their meeting to earlier the same day and same location as our divestment meeting. This will make it much easier for our divestment team to work with PBSR where it makes sense to do so. Our divestment team and PBSR are considering merging the two groups.
Why a Public Bank? Individuals can move their money to local banks, credit unions and savings and loans which tend to be much more socially responsible and which focus on investing in the local economy. But when city governments and institutions divest, where can they take their accounts?
Local banks and credit unions cannot insure accounts larger than $250,000. So when cities like San Francisco, Seattle and Berkeley divest from DAPL investor Wells Fargo, their only option is to bank with another Wall Street bank such as Citibank, JP Morgan Chase and Bank of America, which are just as invested in dirty fossil fuels, predatory lending practices, etc. (See BankOnGood.com to see how dirty your bank is.) How can large institutions like the City of Los Angeles really divest if there is no alternative? The only answer is a public bank.
So now along with promoting individual divestment, the Divestment Team's goal for institutional divestment is getting the City of Santa Rosa to start a public bank.
Public banks are widespread in Europe and other parts of the world. For instance, 40% of banks in Germany are public banks. However public banks are virtually unknown in the US. Ironically, the only public bank in the US is the Bank of North Dakota.
In addition to being able to divest from fossil fuel industries, there are huge local benefits:
A public bank is a wholesale bank. It does not compete with local banks.
When a city owns a public bank, it can save millions of dollars per year on fees normally charged by Wall Street banks.
A public bank has lower costs and can offer lower interest loans.
A city-owned public bank would be able to re-invest its earnings into the local economy and into clean energy programs.
A public bank partners with local banks and credit unions, so the local banks can in turn offer lower interest loans.
A public bank can be set up to be socially responsible, it can be forbidden to invest in dirty fossil fuels, and it can be required to invest locally - all the things we want from our banks.
Wells Fargo Downgraded to Less Than Satisfactory CRA rating
A public bank can seem like a 'pie in the sky' dream. However according to the L.A. Times, in March Wells Fargo has received a "rating of 'needs to improve' on its lending and other activities under the Community Reinvestment Act." The L.A. Times says, "bank regulators have given Wells Fargo & Co. a poor grade when it comes to serving low-income communities." As a result, public entities such as the City of Berkeley and the City of Santa Rosa and other cities are required to stop banking with Wells Fargo, since "some public agencies have policies that restrict them from doing business with banks that have less than a 'satisfactory' CRA rating." This puts additional pressure on local governments to start a public bank, as there are NO socially responsible Wall Street banks large enough to insure their accounts. California State Treasurer John Chiang (who is running for state governor 2018), the City of Oakland and the City of Los Angeles are in the forefront of a public banking movement that is growing as a result of Standing Rock and mounting concern over fossil fuels catastrophic impact on climate change. It is time for the City of Santa Rosa to start a public bank, so it can reap the many benefits to the local economy, as well as enabling the City to invest in many socially responsible endeavors such as expanding clean energy. The city and local economy stands to lose millions in tax revenues if we do not start a public bank in Santa Rosa.
A public bank will allow us to truly defund big oil. Otherwise, what is the point of large institutions divesting?
We need people to put pressure on the city council and city staff to start a public bank.
We need people to write letters to the editor and articles.
We need bodies to show up at a city council meeting.
We need people to give talks about what a public bank will do for Santa Rosa.
We need to figure out how to fund the feasibility study.
In California, we can lead the way for other cities and states to pull their money out of Wall Street banks and their dirty fossil fuel investments, and put that money back into the local economy. Join us.
Message from PBSR: We are calling on Santa Rosa to get on board, bring our money home and establish a Public Bank of Santa Rosa to partner with local banks and credit unions in providing affordable credit to fund small businesses, housing construction, student loans, public infrastructure and renewable energy programs. - Public Banking Santa Rosa working group
Meetings Join our meetings on the second Saturday of the month from 2 to 4pm at the Peace & Justice Center, 467 Sebastopol Ave., Santa Rosa, CA, but the date does change once in a while. Check our Facebook events page for latest updates on meetings and upcoming events, or get on our mailing list.
Conference Calls Another way to work on public banking is to join the Divest/Build Coalition's conference call. Marc Armstrong hosts twice monthly Divest/Build conference calls with participants from across the state two Thursdays a month from 6-7 pm.