A Public Bank In LA May Become A Reality
The idea of opening a public bank in L.A. is one step closer to reality.
The City Council has voted unanimously to hire consultants to figure out how to do this.
Councilmember Curren Price authored this motion. He says a city-owned bank could help more people build wealth, especially those without access to private banking services — such as credit or a savings account.
“We think a public bank can be an important tool in the toolbox to assisting individuals and their families achieve the kind of financial stability that's so important — if we're serious about providing greater opportunities and greater equity for all citizens.” Price says.
A public bank could also help small business owners recover economically from the COVID-19 pandemic. And it could finance infrastructure projects such as renewable energy and affordable housing.
There have been calls over the years for L.A. to open a public bank. Tuesday’s vote comes after former City Council President Herb Wesson introduced his own public banking proposal in 2019. His goal was to provide services to local the cannabis industry, which can't use commercial banks because of federal drug laws. Price said the city's consultants could explore how a public bank could help these and other enterprises. Gov. Newsom signed a state law that allows cities to form these financial institutions in 2019, too.
There is currently only one government-owned bank in the United States — that's the state-owned Bank of North Dakota.