Council seeks information on creating a public bank

City Council on Thursday approved a resolution by Council Member Zo Qadri directing the city manager to research the question of the city of Austin starting a “public bank.” Unlike commercial banks, public banks are required to operate in the public interest. The cities of Philadelphia, San Francisco and Los Angeles have filed legislation requesting that they be allowed to create public banks.

American Samoa, a U.S. territory, also has such a bank. But the only governmental entity operating such a bank within the continental United States is the state of North Dakota, according to the Public Banking Institute.

Qadri’s resolution says “a public bank can help support the investment of City revenues for local benefit in ways that are consistent with the City’s values and policy goals” and “a public bank supports the local economy and provides fair and equitable financial services to the City, businesses, and residents.”

Joining Qadri in sponsoring the motion were Council members Ryan Alter, Vanessa Fuentes, Chito Vela, José Velásquez and Mayor Pro Tem Leslie Pool. Council members Alison Alter and Paige Ellis abstained, and Council Member Mackenzie Kelly voted no.

The resolution asks City Manager T.C. Broadnax to return to Council with the results of a feasibility study by Nov. 1.

Although the item did not attract much public attention, there was at least one speaker who supported the idea. Jay Popham praised the idea of a public bank, saying, “It’s a forward and beneficial program to be considering … for our long-term financial stability.” He quoted Rashida Tlaib, a member of Congress who is sponsoring federal legislation to allow establishment of such banks.

Although he was not in town, longtime Austin political observer Alfred Stanley said on Facebook, “Don’t waste public $$ on a feasibility study. You don’t need to be a rocket scientist to know this idea will never take off in Texas.”

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