A handful of banks such as JPMorgan Chase and Wells Fargo are funding the climate crisis by investing in fossil fuel companies and projects like the KXL and DAPL pipelines, fracking, coal mines, etc. 350 Colorado and allies have been working for 3 years to urge our cities to stop banking with these banks, but currently there aren’t many options.

So we and other groups around the US have started looking at public banking and/or banking with credit unions as a great alternative that keeps $ local, supporting local priorities (instead of fossil fuel projects). There is interest. However in CO, enabling legislation is needed to authorize cities and counties to create public banks and/or to bank with NCUA-insured credit unions (currently they can only bank with FDIC-insured banks, even though NCUA insurance is more protective). Similar legislation just passed in CA. Legislators here are potentially interested and need widespread support.

Please share with anyone else who you think may like to sign! Thank you!

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Sign-on Letter of Support for Legislation Enabling Cities and Counties in Colorado to Create Public Banks and Bank with Credit Unions

We, the undersigned organizations, businesses, community leaders and individuals, support opportunities in our state to create public banks and allow banking with NCUA-insured institutions such as credit unions. This letter is co-signed by entities representing tens of thousands of Coloradans who support socially responsible banking and consider it a vital part of addressing climate and social justice and providing alternate banking models that support local community health and vitality.

Recognizing that social responsibility includes where we invest public funds, the ability to create public banks and/or to bank with credit unions will ensure options are available to communities that do not wish to bank with financial institutions that fund human rights abuses and climate disasters. Instead, taxpayer dollars can be invested in local priorities, such as low-income housing and clean renewable energy.

According to the Banking on Climate Change 2019 report, 33 banks funneled over $1.9 trillion into fossil fuel projects since 2016. JPMorgan Chase has funneled over $196 billion into fossil fuel projects and infrastructure investments since the Paris Climate Agreement. Other top banking funders of fossil fuel projects include Wells Fargo, Citi and US Bank, which invest billions of dollars every year in controversial fossil fuel projects, including the Dakota Access and Keystone XL Pipelines and fracking across Colorado. These projects disproportionately harm low-income communities of color, have ignored indigenous rights, and contribute significantly to the climate crisis. They are incompatible with the emissions reductions targets laid out in the Paris Climate Agreement, as well as recently passed legislation in our state aiming to significantly reduce GHG emissions. Many of the same companies fund private prisons and ICE detention centers.

We, the undersigned, support enabling banking options for Colorado cities and counties, including authority to create public banks and to bank with NCUA-insured credit unions, to provide much-needed alternatives that align with local values and support local priorities.

Sign on here. 

*Further information on Public Banking and why it is needed now follows.

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What is a Public Bank? A Public Bank is a chartered depository bank in which public funds are deposited. It is owned by a government unit — a state, county, city, or tribe — and mandated to serve a public mission that reflects the values and needs of the public that it represents. In existing and proposed US Public Bank models, skilled bankers, not the government, make bank decisions and provide accountability and transparency to the public for how public funds are used.

What is public banking? Public banking is banking operated in the public interest, through institutions owned by the people through their representative governments. Public banks can exist at all levels, from local to state to national or even international. Any governmental body which can meet local banking requirements may, theoretically, create such a financial institution.

Public banking is distinguished from private banking in that its mandate begins with the public‘s interest. Privately-owned banks, by contrast, have shareholders who generally seek short-term profits as their highest priority. Public banks are able to reduce taxes within their jurisdictions, because their profits are returned to the general fund of the public entity. The costs of public projects undertaken by governmental bodies are also greatly reduced, because public banks do not need to charge interest to themselves. Eliminating interest has been shown to reduce the cost of such projects, on average, by 50%.

What legislation is needed? Legislation is needed to clarify that cities and counties are authorized 1) to bank with financial institutions that carry NCUA insurance (not only FDIC insurance as is now the law), which would enable banking with local credit unions, and 2) to establish their own public banks, likely under a charter from the state banking commission.  Although we believe public banking may already be legal for home rule cities and counties, enabling legislation would eliminate doubt about it.  Public banks can work together with credit unions or community banks to support community priorities through loans.

Why is Public Banking important now? Cities and counties are often strapped for funds, facing cuts to public services, and tough decisions regarding selling off valuable assets.  A public bank enables local governments to make substantially more funds available by loans for urgent needs such as affordable housing, clean energy, infrastructure (roads, bridges, parks, etc.), health care, education, environmental cleanup, etc. and a portion of the income of the bank could be paid into the general fund.

If the bank is established as a “TABOR enterprise”, its income and expenditures would be exempt from the TABOR limits that have so strapped government in Colorado.  Representatives of numerous stakeholder groups–climate change, clean energy, affordable housing, education and student loans, health care, small business, infrastructure are very enthusiastic about the potential for public banks to help meet local needs and budget shortfalls.

Furthermore, public banking addresses the issue of the funding of extreme fossil fuel projects inadvertently through many of the major Wall Street banks. For those concerned about the climate crisis and looking for solutions, shifting our banking model to withdraw public funds from fossil fuel companies is an essential step.

For more information on public banking visit Rocky Mountain Public Banking Institute’s website: http://bankingoncolorado.org/