Public banking in New Mexico: An update
On Sept. 19, 2017, I submitted a My View piece, “Work still happening on public bank for Santa Fe” in response to a letter published a few days earlier. Because of some cyber kerfuffle — the piece showed up Jan. 10 in the email file for Letters to the Editor — the piece was published again last Sunday.
Much has happened on the public banking front since 2017 and it is likely that this untimely publication is confusing. To bring people current on the public banking initiatives in New Mexico, I offer the following update.
Encouraged by the grassroots organization WeArePeopleHere!, the idea of a public bank in New Mexico was introduced in the New Mexico Legislature in 2012 by House Speaker Brian Egolf as a potential tool to improve the state’s faltering economic health.
WeArePeopleHere!’s initial exploration of how a public bank could serve New Mexico resulted in launching Banking on New Mexico, a new research and educational outreach organization in 2013. Banking on New Mexico undertook an extensive, in-depth examination of public banking, already attracting significant national attention. We also began discussions with business, community and political leaders across the state about the concept, which is largely based on the 100-plus years of profitability and economic stimulation fostered by the Bank of North Dakota, the first public bank in the U.S.
In 2014, we co-hosted a public banking international symposium in Santa Fe, bringing together county and city leaders with national experts in economics, government finance, U.S public banking initiatives and a representative from the German public banking system.
Even though Santa Fe was among the smallest American cities to consider public banking, the Santa Fe mayor and City Council were committed to studying whether a public bank could generate revenue and reduce expenses for the city. A city-commissioned feasibility study reported in 2016 that a city-owned public bank was feasible, and therefore in 2017, the mayor and City Council appointed a nine-member Public Banking Task Force to continue research into such a bank for Santa Fe. That task force concluded, in part, that the city of Santa Fe was too small to efficiently support a public bank.
Building on the Santa Fe Public Banking Task Force’s research and recommendations, Banking on New Mexico returned to its original vision of a statewide public bank with an enhanced understanding of the legal, regulatory and capitalization issues unique to New Mexico. Our work on the state level resumed at a time when the public banking movement continues to gain momentum nationally as public banks are currently being considered in Berkeley and Oakland, Calif., Los Angeles, Boston, Pennsylvania, Colorado, Washington, New York and Michigan.
Banking on New Mexico has joined forces with Albuquerque’s well-established Public Bank for Central New Mexico, and together we’ve formed a new organization, the Alliance for Local Economic Prosperity, to spearhead a statewide educational campaign to help people understand that keeping New Mexico money in New Mexico can grow financial resources that are safe, support local economic and educational systems, invest in job opportunities and human development, and diversify our economy.
Acting on Santa Fe’s Public Bank Task Force recommendations, in 2018 we began meeting with legislators to plan the best way forward for a statewide public bank initiative. A memorial will be introduced in the Senate calling for a State Public Banking Feasibility Study this year. The proposed study will focus on the financial feasibility, operational costs, capitalization and benefits of creating a state public bank.
With this feasibility study and our continuing educational outreach, the Alliance for Local Economic Prosperity is building support for establishing a New Mexico Public Bank in the near future. For more information about the “Alliance for Local Economic Prosperity,” go to our website: bankingonnewmexico.org.
George Gamble is a board member of the Alliance For Local Economic Prosperity and lives in Santa Fe.