FOR IMMEDIATE RELEASE: May 15, 2024
Contact: Andy Morrison, andy@neweconomynyc.org
GROUPS, ELECTEDS HOLD PRESS CONFERENCE AT CAPITOL CALLING ON ALBANY TO BRING PUBLIC BANKING TO NEW YORK — AS BOLD STRATEGY FOR INVESTING IN LOW-INCOME COMMUNITIES & COMMUNITIES OF COLOR
COALITION ANNOUNCES SUPPORT FOR NEW BILL ESTABLISHING A ROCHESTER PUBLIC BANK, URGES PASSAGE THIS SESSION
ALBANY, NY – On Wednesday, lawmakers joined community and labor groups at the Capitol to demand Albany bring public banking to New York this legislative session. The coalition declared its strong support for a new bill, the Bank of Rochester Act (S9326/A10134) and continued to call for passage of the broadly-supported New York Public Banking Act (S1754/A3352).
The New York Public Banking Act, first introduced in 2019 and sponsored by Senate Banks Committee Chair James Sanders Jr. and Assembly Banks Committee Chair Pamela Hunter, would create a safe and appropriate regulatory framework for local governments to establish public banks. Local public banks would hold municipal deposits and partner with responsible lenders to make sorely needed investments in affordable housing and green infrastructure, as well as expand access to equitable financial services in historically-redlined communities. A majority of the NYS Senate and more than 60 NYS Assemblymembers support the Act, as do more than 100 local elected officials representing 33 cities and counties across the state and more than 160 community, labor, and local economic development organizations. The banking industry has continually lobbied to stymie the bill’s progress.
The new bill, just introduced by State Senator Samra Brouk and Assembly Member Harry Bronson, would establish a public bank in Rochester, where the Mayor, City Council, and local advocates are united in their call for public banking. Under the bill, Rochester could apply for a state charter for a public bank from the NYS Department of Financial Services. Once approved, it would become the country’s first full-fledged municipal public bank, and would be able to hold state, municipal, and Monroe County deposits.
At the press conference, organized by NYS Community Equity Agenda, Public Bank NYC and the Rochester Public Banking Coalition, public banking advocates from across the state strongly endorsed the Bank of Rochester Act, which they lauded as one of the strongest public banking bills in the country. They further praised the bill for largely adopting the framework set by the New York Public Banking Act.
Advocates referenced a plethora of recent research showing that the big banks that currently hold the vast majority of government deposits are failing to serve New York’s Black and brown communities. Last year, the NYS Attorney General released a report exposing pervasive systemic racial inequities in mortgage lending statewide, and recommending public banking as an urgently-needed structural solution to banking inequality. In addition, research by New Economy Project found that the four biggest banks on New York City’s depository list were responsible for egregious racial disparities in mortgage and small business lending and bank branch distribution.
Research also demonstrates how public banking would help to spur transformative investments in historically-redlined communities. A 2023 report by the New School’s Center for NYC Affairs found that within five years, a NYC-based public bank would generate almost 71,000 new jobs, 18,000 affordable housing units, $1.1 billion for climate solutions, and $5.8 billion in new loans to Black and brown neighborhoods through partnerships with Community Development Financial Institutions, including community credit unions, and other responsible lenders.
At the rally, community credit union representatives emphasized that working with public banks would help them expand their capacity and lending output. In recent years, national demand for CDFI products has skyrocketed; according to a 2023 survey, three out of four CDFIs reported experiencing increased demand for their products over the past year, and less than half of those were able to fully meet the demand.
QUOTES:
“Our coalitions have built a powerful movement to bring public banking to New York State,” said Tousif Ahsan of New Economy Project, which coordinates the NYS Community Equity Agenda and Public Bank NYC coalitions. “Public banking is a transformative solution that will enable local governments to divest public dollars from banks that harm New Yorkers and New York communities, and reinvest in low-income, Black, brown, and immigrant neighborhoods. Our coalition strongly endorses the establishment of a Rochester public bank, which we see as a launching pad for making public banking a reality throughout New York State, and we urge the legislature to act this session.”
“We are thrilled to work with Senator Brouk and Asssemblymember Bronson to bring public banking to Rochester, which has one of the highest rates of poverty in the country and which is now facing the threat of speculator-driven gentrification and displacement. A public bank will enable local financial institutions like ours to grow and serve Rochesterians at the scale needed to truly create thriving communities,” said Melissa Marquez, Chief Executive Officer at Genesee Co-op Federal Credit Union in Rochester. “As members of the Rochester Public Banking Coalition, we are proud to have led the charge alongside the NYS Community Equity Agenda and Public Bank NYC to make public banking a reality in New York State.”
“Public banks help to bring equity, justice and fairness into our economy. They are powerful drivers of economic investment that demonstrate direct impact by strengthening local economies, supporting community driven economic development programs and addressing infrastructure and housing needs for localities – all without negative impact to existing financial institutions,” said Assemblymember Harry Bronson. “I am proud to sponsor the Bank of Rochester Act in the Assembly which will establish a Rochester public bank in one of the most underserved cities in the state. This legislation has the support of my fellow Rochester lawmakers, the Mayor and City Council, and is an important step forward to making public banking accessible throughout New York State.”
“This week I introduced the Bank of Rochester Act, S9326, as part of our ongoing efforts to support community-led development and build an economy that works for all,” said State Senator Samra Brouk. “Public banks play an important role in fostering long-term economic stability and promoting the creation of safe, healthy, and thriving communities.”
“The New York Public Banking Act and the Bank of Rochester Act have the potential to create new ways to invest in our communities and small businesses,” said Assembly Banks Chair Pamela J. Hunter. “With the recent developments in regional banking, public banking is something to be thoroughly considered. As the Chair of the Assembly Banks Committee and lead sponsor of the New York Public Banking Act legislation, I am happy to facilitate and prioritize these vital discussions.”
“I am thrilled to support the New York Public Banking Act, which offers a transformative solution to democratize our financial system and uplift underserved communities,” said Assemblymember Steven Raga. “We are sending a clear message that it’s time to prioritize people over profits. As we witness cities like New York City and Rochester leading the charge in establishing municipal banks, it’s evident that a more equitable and inclusive financial future is within our grasp.”
“Currently, New York State’s taxpayer dollars sit in private banks on Wall Street where the funds are invested in destructive industries like fossil fuel companies and private prisons,” said Assemblymember Harvey Epstein. “On top of this, some of these banks are unstable, like Silicon Valley Bank and Signature Bank and put New York’s future investments at risk. A public bank gives New Yorkers the voice they deserve, placing the money where it is publicly accountable and utilized for investment in New York priorities like affordable housing, clean energy initiatives, a just transition and fair banking services. This has the potential to transform our banking system by making it more equitable, accountable and profitable for New York. We don’t have time to waste in protecting New Yorkers.”
“With widespread support in both the Senate and Assembly, we have an opportunity this year to make the transformative solution of public banking a reality,” said Assemblymember Anna Kelles. “Public banks exist in other states and around the world, and New York can seize on the successes of those models, bringing responsible lending and banking services to underserved communities while investing in renewable energy and climate solutions for the public good. Now is the time for us to establish public banking rooted in our communities and not let this critical piece of legislation stall any longer.”
“Public banking will serve vulnerable communities across the state, like the community of Red Hook in AD 51, which is a banking desert,” said Assemblymember Marcela Mitaynes. “The New York Public Banking Act will expand opportunities for working people, and will give localities like NYC an alternative to doing business with banks that invest in the fossil fuel industry. When we create a public option, we’ll create a more equitable future. No longer will working people be deprioritized and discriminated against. That’s why we must pass the New York Public Banking Act now.”
“As an organization deeply committed to systems change so the law works for all New Yorkers, we see the Bank of Rochester Act not only as a historic opportunity for Rochester to advance economic justice, but also as a stepping stone for establishing public banks in counties and municipalities throughout the state,” said Barb Van Kerkhove, policy analyst at the Empire Justice Center. “By placing their public monies in public banks, Rochester and other local governments in New York can ensure they’re doing all they possibly can to create affordable housing in redlined communities, boost access to affordable financial services, and support community wealth-building.”
“Our community credit union, which serves Ithaca and its surrounding counties, has worked for 45 years to create economic opportunities and provide fair financial services for marginalized communities,” said Kevin Mietlicki, President and Chief Executive Officer of Alternatives Federal Credit Union. “Public banks, which would partner with Community Development Financial Institutions (CDFIs) like ours to boost lending capacity, would make a tremendous difference in the lives of low and moderate-income people in Central New York. We need Albany to enact the New York Public Banking Act immediately.”
“Recent disastrous bank failures make it clear the New York Public Banking Act is too important to be put off any longer,” said Jodie Leidecker, a Cooper Square Committee Housing Organizer. “Tenants have experienced harassment and displacement for years and want to know their tax dollars are supporting affordable housing–not bad-acting landlords. A public bank will support community land trusts and other tenant-owned and controlled housing that will go far in curbing housing profiteering.”
“For far too long, the private banking system has enabled and exacerbated conditions of structural economic deprivation. They have done this both in overt ways, including the redlining of neighborhoods and discriminatory mortgage lending practices, and more covert ways through inequitably distributed access to banking services, credit, and debt, which have trapped countless New Yorkers in cycles of poverty,” said Joseph Jones, Director of Policy, Advocacy, & Research at the Federation of Protestant Welfare Agencies (FPWA). “As we continue to dismantle the structures and systems that impede true economic security for all New Yorkers, especially for those with low incomes, we are also calling on New York State to bring public banking to New York. A public bank will allow local governments to utilize both the credit and the revenue generated by public funds to invest in local communities, including supporting CDFIs, credit unions, and financial institutions that promote community investment and wealth development for low-wealth communities that have been historically underserved. We will continue to closely monitor any public bank created to ensure it lives up to its transformative potential for helping achieve economic security for all.”
“As a college student and a young person, climate change is a very important issue for me. It’s unconscionable that our tax dollars are deposited with Wall Street banks that invest in fossil fuel companies, exacerbating the climate crisis and increasing carbon emissions. New York has already suffered terrible loss of life and property with recent superstorms like Sandy and Ida, and as our planet continues to warm, it is likely more superstorms will devastate our city,” said Damien Andrade, the chairperson of NYPIRG’s Board of Directors and a Brooklyn College student. “With a public bank, we could divest from Wall Street and finally put our public dollars to work building a green, sustainable future, including by developing solar co-operatives, reducing building emissions, and making other renewable energy upgrades to our city.”
“Thanks to the incredible work of a statewide grassroots coalition, New York has a unique opportunity to make history with the Rochester Public Banking Act, which would capitalize the first public bank in the domestic U.S. in over 100 years,” said Geeta Minocha, Executive Director of the Public Banking Institute and Founder of the Ohio Public Banking Coalition. “This would be a huge victory for Rochester residents, but is not enough — we’ve got to democratize money and bank the unbanked all over New York State. I urge the Legislature to pass both the New York Public Banking Act and the Rochester Public Banking Act.”
“New York communities need public banking legislation. Municipally chartered public banks can fill the void created by private banking institutions in underbanked and historically redlined communities of color, which have left people and whole neighborhoods vulnerable to predatory lending,” said Christie Peale, Executive Director of the Center for NYC Neighborhoods. “Public banking can also provide critical capital to fuel a range of affordable solutions for working and middle-class homeowners, including home upgrades to future-proof homes through decarbonization and towards climate resilience.”
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