On Tuesday, Feb. 7, 2023, state legislators joined student advocates outside the state Senate chamber to show support for a bill that would create public banks in the state of New York.
“I am here with the best people money can’t buy,” said Sen. James Sanders Jr., D-Queens, who chairs the Senate Banks Committee and is the main sponsor of the bill. “I say that we should go to public banking. As a matter of fact, we should do it in this budget.”
The bill (S.1754 / A.3352) would establish the “New York Public Banking Act,” and would enable municipal and local governments to create public banks which would support local communities by providing lower cost banking services, such as loans, mortgages and financial support for small businesses.
Public banks received positive attention during the COVID-19 pandemic, due to their ability to work quickly without layers of bureaucracy and have better understandings of their local clients.
Other members of the state Legislature spoke in favor of the bill, including Senators Robert Jackson, Rachel May and Assembly Members Ron Kim, Emily Gallagher and Amanda Septimo. Also present were supporters and members of NYPIRG, and the East New York Community Land Trust, which supports communities of color in the areas of East New York and Brownsville in Brooklyn.
“Imagine a bank where you could get a loan for a 1 percent interest rate,” said Senator Robert Jackson, D-Washington Heights. “It would change the lives of so many people in New York.”
Several speakers, including East New York CLT President Albert Scott Jr., also noted that funding public banks would take money away from commercial banks that use their funds to support environmentally harmful ventures, such as the fossil fuel industry.
According to the bill memo, the Bank of North Dakota, founded in 1919, is currently the only public bank that exists in the United States, although many public banks exists in Europe and Costa Rica.
Since 2010, 28 states in the U.S. have passed legislation to establish a public banking task force or to create a public bank in the state. The state of California enacted a law in 2019 allowing municipalities to form a public bank.
The timing of the rally comes a week after Gov. Kathy Hochul released her 2024 Executive Budget. Supporters of the bill are hoping to see some of the budget’s sizable surplus used to support the public banking initiative.
“Governor Kathy Hochul, it is reported by the Comptroller that you have an $8.7 billion surplus. If there was ever a time to do public banking, it is now,” said Sen. Sanders. “I want you to listen to the roar of the people instead of the whispers of private interest.”