What benefits would there be from establishing the D.C. Public Bank?

  1. Create new jobs and spur economic growth. The D.C. Public Bank would be a participation lender, meaning it partners—never competes—with local banks to drive lending through local banks to small businesses. The proposed bank could help local private banks, community banks and credit unions expand lending by billions of dollars in the District and help small businesses create thousands of new jobs for local workers.
  2. Promote a Sustainable DC. The many ambitious and innovative proposals coming out of the Sustainable DC process need a source of investment to make them a reality. The D.C. Public Bank could be an important source of such investments, particularly for capital-intensive initiatives like ensuring energy-efficient, affordable housing to retain the District’s economic and ethnic diversity.
  3. Generate new revenues for DC. This could be done directly, through bank dividend payments, and indirectly by creating jobs and spurring local economic growth.
  4. Lower borrowing costs for DC government. The D.C. Public Bank could provide access to low-cost funds for revolving lines of credit on open deposit accounts held by D.C. government agencies.  It could also potentially provide loans for public infrastructure projects.
  5. Strengthen local private banks, community banks, and credit unions, even out credit cycles, and preserve real competition in local credit markets. There have been no bank failures in North Dakota during the financial crisis. BND’s charter is clear that its goal is to “be helpful to and to assist in the development of [North Dakota banks]… and not, in any manner, to destroy or to be harmful to existing financial institutions.” By partnering with them on large loans and providing other support, the D.C. Public Bank would strengthen small banks in an era when federal policy encourages bank consolidation.
  6. Build up small businesses. Surveys in other states show at least 75 percent support among small business owners for public banking. The D.C. Public Bank would increase lending capabilities at the smaller banks that provide the majority of small business loans in America.

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