Tuesday, October 24, 2023
Chair Feeney, Chair Murphy, and Members of the Joint Committee on Financial Services:
My name is Jonathan Cohn, and I am the policy director at Progressive Massachusetts. We are a statewide, multi-issue, grassroots membership organization focused on fighting for policy that would make our Commonwealth more equitable, just, sustainable, and democratic.
We urge you to give a favorable report to S.632 / H.975: An Act to establish a Massachusetts public bank.
A Massachusetts public bank would strengthen local economies, especially those in underserved communities. It will help provide cost-effective financing for small businesses and municipalities, land trusts and cooperatives, and projects for climate change adaption and mitigation.
A public bank would put public money to work for the public. Much of our Commonwealth’s funds are deposited in the Massachusetts Municipal Depository Trust, which invests nationally and internationally. With a public bank, we could be bringing some of that money back home to Massachusetts in service of a more equitable and sustainable state and local economy.
A public bank would be good for our cities and towns. Cities and towns, constrained in how they can raise money, often lack the resources for necessary long-term investments. A public bank would offer cities and towns an affordable and flexible alternative to the bond market for important local infrastructure projects.
A public bank would be good for our small businesses. Many small businesses are still struggling due to the disastrous economic impact of the COVID-19 pandemic. A public bank would be able to extend loans to small businesses, helping them to weather such difficult time as well as to grow and expand to better serve the community. The bill would specifically target rural communities and underserved neighborhoods, where entrepreneurs often face significant obstacles to securing seed funding for new businesses, and it can help encourage the flourishing of cooperative businesses and worker-owned coops, business models that exemplify shared prosperity.
A public bank would address long-standing economic inequities. We know that women and communities of color have faced longstanding barriers in securing access to capital. A public bank can help to level the playing field.
A public bank would be good for the environment. A public bank could support initiatives to mitigate the dangers of climate change, and it could help local farms adopt and promote sustainable agricultural practices.
Importantly, the bill recognizes that while all of these are exciting possibilities unlocked by a public bank, we need the right governance in place to make them a reality. That’s why the bill ensures that the board of advisors for the bank would represent the concerns of municipalities, underserved neighborhoods, small business, community development and community development finance, community banks and credit unions, sustainable agriculture and food security, workers’ interests, climate change and green finance, and environmental justice.
Thank you for all your work on today’s hearing. Again, we urge swift action to advance S.632 / H.975: An Act to establish a Massachusetts public bank.
Sincerely,
Jonathan Cohn
Policy Director
Progressive Massachusetts
