Our mission is to support the growth of public banking in Massachusetts, initially focusing on an infrastructure bank to help cities and towns with the costs of upgrading buildings, roads, and water systems, with environmental remediation and adaption to a changing climate, and with improving city services. We envision a public institution managed professionally, guided by citizen oversight, and accountable to the public as its only stockholders. We promote a bank that works in partnership, not competition, with local banks, credit unions and community development financial institutions.
Why a public bank? Over past decades, investor-owned banks have put their own gain before the well-being of the people and businesses they serve and the cities in which they operate. The result has been a tightening of credit just when communities need it most. Instead, short-term profits have been sought in stocks, derivatives and other speculative investments.
Our cities and towns require a public service bank that lends at affordable rates rather than at higher rates and fees that support short-term investor profit and excessive executive pay and bonuses. We need a bank that reduces the cost of public projects because its participating municipalities will not charge themselves high interest and finance fees. We need a bank whose profits are returned to municipal coffers thereby raising revenue and protecting government services from budget cuts. Such a bank would also protect public money and pensions from risky Wall St. investments. A public bank working in partnership with community banks ensures that local money works locally and stays local supporting development and businesses that build up our neighborhoods and increase our “common wealth.”
How would a public bank be structured? A state infrastructure bank would be chartered like any bank, and would be managed by professionals, not politicians. It would operate under the supervision of a Board of Directors and an advisory board, and would prepare regular reports and would undergo periodic audits.
Based on its capitalization and deposit base, the bank would make loans to Massachusetts cities and towns for infrastructure projects. It could work in partnership with community banks which qualify borrowers and keep loan origination fees. Because it does not operate as a retail bank taking in deposits from individuals and businesses, the public bank is not in competition with local community banks. The public bank will use the latest technology to balance the needs of participating communities and to efficiently, transparently, and securely carry out its mandate.
We work with the national Public Banking Institute, and seek to work with other community banking organizations, as well as other community-minded people and groups, in and beyond Massachusetts. Public banking is an idea whose time has come and one from which we all stand to gain. We welcome your participation in making it happen.
How can you help?
We would welcome invitations to speak to local groups, including economic development organizations, community bankers, and city government, about our bill and how it will help Massachusetts communities and small banks. If you would like to host a presentation, please contact us.
We are also recruiting individuals with strong backgrounds in banking, public administration, economics or community development to serve on an advisory committee for our group.
Finally, we expect that a bill will be refiled in the 2019-2020 Massachusetts legislative session to establish a public bank, very similar to last term’s bill, H.3543, “An Act Establishing the Massachusetts Infrastructure Bank.” We will need people to ask their legislators to co-sponsor this new bill. Keep an eye on our website for the latest information.
We also welcome questions about our work and public banking in general—explore our site and check back as we post more information, or send us your questions and ideas.