Although Coloradans have been campaigning for public banks at the state and city levels since at least 2011, the movement has now taken off in full force. On January 31, the group Be the Change-USA sponsored a public banking conference with more than 120 attendees, moderated by Denver city officials and community bankers, and featuring speakers such as Ellen Brown, Mike Krauss, Gwen Hallsmith, and Nomi Prins.
Shortly after the conference, Be the Change-USA co-director Earl Staelin published an OpEd in the Denver Post:
Colorado entrepreneurs seeking green energy solutions and small business start-ups scramble for funding. Needed infrastructure projects like repairing our state bridges are not keeping up with civil engineers' recommendations. Meanwhile, the marijuana industry has no place to bank its cash....A public bank here in Colorado working together with our locally owned community banks is a promising option for expanding real prosperity and well-being here. It would be required to lend in Colorado. Its mission would not include paying commissions or bonuses, making risky investments in subprime loans or derivatives, or profiting at the expense of our community. A public bank's mission would be to serve our communities by helping them thrive and our citizens prosper — through supporting small and medium sized businesses, green energy, lower student debt, reduced home foreclosures, sustainable farming, infrastructure, and more.
And from Caitlin Rockett, in the Boulder Weekly, comes this great analysis of the Boulder public banking movement's synthesis of the public finance and environmental sustainability visions:
For Alison Burchell, a geologist and founding member of Clean Energy Action, Boulder’s muncipialization effort is a pressing priority. Burchell says that she began to seriously look into how public banking could push municipalization forward about two and a half years ago.
Burchell took a look at the city’s financial statement for 2013 and found that all combined — from general reserves to waste water and downtown funds — the city has $269 million in reserve funds.
“So [on average] you need $25 million to set up a bank,” Burchell says. “Every $25 million gets you $250 million in loan credits. The thing that stopped me in my tracks is what is the other $250 million number we know floating around our community?”
The estimated funds needed to municipalize Boulder’s electric utility.
“The interesting thing about that money, [and] I don’t know where that money sits, but let’s say it sits in Wells Fargo. What’s the interest we’re getting on it now — 1 percent, something like that?” Burchell says. “When we go to borrow it back we have to pay loan fees and interest on what we borrow back.
“Whether with municipalization or not, there are going to be improvements to the way we produce and consume our electrons,” she says. “It’s very, very expensive if we go through a series of banks and a series of loan agencies … These are high risk projects, and it’s very expensive to loan or bond them. If we set up our own bank, we can begin to loan to ourselves and collect interest on our own money, and it doesn’t have to be these exorbitant interests, it could be more reasonable rates of interest, 3 or 4 percent, and still make a great profit.”
As a geologist, Burchell says she is drawn to concepts like public banking because of the environmental projects such institutions can fund. She makes no attempt to disguise that for her, municipalization is key where public banking in Boulder is concerned — and she’s not alone.
Amanda Bybee, vice president of Namesté Solar in Boulder, originally hails from Austin, Texas, where the utility is municipally owned. Bybee sat on a panel at the Jan. 31 public banking conference in Denver to discuss the need for local funding.
“I think there’s a lot to be said of public institutions that are accountable to the public. In Austin the utility is the primary fund that supports every other budget the city has, and that’s a great thing,” Bybee says. “And they’re able to say, ‘We care about where our energy comes from, we care about climate change, we care about economic development’ … but it’s hard to do. Look at what Boulder has had to put in place to even get as far as it is has [with municipalization].”
Beyond municpalization, Bybee says that public banking could simply provide a better option for individuals and businesses that want to get loans to install solar systems.
“So [the] solar [industry] is in a good position in the sense we have a good number of financing options, and there are a number of groups out there that provide solar loans and opportunities to make this accessible to people,” she says. “But the question for [Namesté Solar] is less about ‘Do we have access at all?’ and more about ‘Is there a better way to go about it that benefits the local economy?’”
Share this blog post with your friends!