Time to push for a state bank of WA

[eridani]

http://www.nwprogressive.org/weblog/2010/02/hasegawa-proposes-state-owned-bank-of.html

Many experts say that the key to economic recovery lies in small business growth, but many of these very businesses are having a hard time accessing capital as traditional financial institutions become increasingly risk-averse.

Could this be the time for a new kind of bank? One state legislator thinks so.

Imagine controlling our money and investing to stimulate the economy. Imagine financing student aid, infrastructure, industry and community development. Imagine providing access to capital for small businesses, or otherwise leveraging our resources instead of having to do it with tax incentives. Imagine keeping our resources local instead of exporting them as profits, never to be seen again—that’s what this bank could do.”
That's how Rep. Bob Hasegawa (D-Seattle), vice chair of the House Finance Committee, describes HB 3162, which would create the State Bank of Washington. Under this bill all state funds would be deposited at this bank and would be guaranteed by the state.

The State Bank of Washington would promote agriculture, education, community development, economic development, commerce and industry.

As we weather this depression, the lack of accessible capital for small businesses is worsening the economic hardships that hundreds of working families are going through. Small businesses are the economic drivers that help Washington’s commerce run smoothly, but when they cannot access the capital they need, the consequences result in chain reactions that invariably end up hurting most, if not all, working families, small businesses and family farms in our state.
Currently, the State Treasurer invests the state's operating cash in short-term, interest bearing accounts in public depositories. This provides the state with a return while preserving the state’s ability to access the funds. Public depositories are banks and thrifts that are approved to hold state and local government deposits. They may be small community banks or large national banks.

If Washington had a state-owned bank, the Treasurer would deposit state funds into it. This way the state bank could lend money, assume debt and invest in private companies just like a private bank does. This could lead to greater returns on the state funds. It could also provide access to capital to businesses that desperately need it to not only stay afloat, but to thrive.

The state could assume risk and could make money, which would lead to greater sums that could be reinvested in loans or provided to the General Fund.

Here's Hasegawa again:

My bill is modeled after the Bank of North Dakota, the only state-owned bank in the nation. By the way, North Dakota isn’t going through a financial crisis right now and the Bank of North Dakota is credited with being a large part of the reason for that.
Creating a Bank of Washington would require an amendment to the state Constitution, meaning some Republicans would have to support the idea.

HB 3162 was referred to the House Financial Institutions & Insurance Committee, but since it has not been scheduled for a hearing, it is unlikely to go anywhere.

[seattle_blue]

1. AM 1090

Just listening to Jack Rice on the radio and he's rockin that mother &%#)*$^&*(* HOUSE!!!! He's simply awesome!

[eridani]

2. There will be a hearing on this bill at 8AM March 2nd

It's a House bill--don't have the room # yet.

[eridani]

3. Update and details

Rep. Hasegawa wanted to inform you that a public hearing has been scheduled next Tuesday for HB 3162 – a bill that authorizes the creation of a state bank. There has been so much interest in this idea that Chair Kirby of the FI & I committee has scheduled a special work session on the bill. So there will be plenty of time for testimony. If your schedule will allow Rep. Hasegawa would very much appreciate your presence and testimony in support of this idea.

Here are the details:

Financial Institutions & Insurance Committee - Tuesday, 03/02/10 8:00 am
House Hearing Room D
John L. O'Brien Building
Olympia, WA
Public Hearing: HB 3162 - Authorizing the creation of a state bank.

If you can’t make it in person you can also feel free to send any written support to the members of the committee, which you can find here.

Thank you,
Marissa

Marissa Chávez
Legislative Assistant to Rep. Bob Hasegawa
Washington State House of Representatives | 11th Legislative District
425 JLOB | PO Box 40600 | Olympia, WA 98504-0600 | 360.786.7862
District office|219 1st Ave. S| Seattle, WA 98104 | 206.587.5554

[eridani]

4. My report on the hearing

Hearing on the state bank bill HB 3162 (HJR 4224) 3-2-2010
Financial Institutions and Insurance Committee
http://www.leg.wa.gov/House/Committees/FII/Pages/MembersStaff.aspx

Presentation by Rep Bob Hasegawa (D-LD11)

Reasons for establishing a state bank
• Better access to capital for small businesses and farms
• Promote economic development
• Smart government
• Best use of taxpayers’ resources

The legislation creates a bank that is modeled after the very successful Bank of North Dakota. http://www.banknd.nd.gov/ The bank has 175 employees. It was established in 1919 as a response to a serious credit crunch that was impoverishing farmers. People were angry about the outside control of both credit and grain markets by people from outside the state. Politics as usual was not working, so a new political party, the Nonpartisan League, ran on the platform of establishing a state bank.

The BND is run by a three member Industrial Commission consisting of the governor, the agricultural commissioner and the attorney general. It is not like a regular bank taking deposits from and lending to individual consumers; it is more of a “bankers’ bank,” or a mini-Federal Reserve bank. It pays 0.25% less interest than state agencies would get from a commercial bank. It pays no federal or state taxes: North Dakota taxpayers are on the hook for any losses—luckily there haven’t been any recently. It has ~$4 billion in assets, a $2.67 billion loan portfolio, and $58 million in profits for 2009.

It has survived the worst situation for state governments since the Great Depression. They had little fallout from the 2008 crisis because they had no exposure to derivatives or sub-prime loans. Certainly it helps that resource prices for ND oil and minerals are high, but many other oil states have very serious budget problems now (OK, for example) and ND does not.

It does not compete with commercial banks, though CDs are available to the public. It is involved in housing only with secondary loans. The legislature can and does create loan programs as a cheaper alternative to tax incentives. Bob showed a short PBS clip featuring commercial bankers in ND testifying about the highly favorable partnerships that they have established with the state bank.

The one disadvantage to having a state bank would be the loss in the interest earned from commercial banks (about $4 million), though as of now this would be mitigated by the unusually low interest rates in effect. The advantages would be—
• The ability to self-fund capital projects
• The strong multiplier effect of keeping money local
• The ability to subsidize student loans
• The ability to use secondary financing to absorb debt capacity, thereby enabling us to keep more people in their homes and on their farms.

Activity in other states on banking issues includes—
• NM passed a bill 65-0 to give preferential treatment to local community banks for its deposit.
• OR gubernatorial candidate Bill Bradbury (D) is running on the issue of establishing a state bank.
• ID state representative Stivers (R) is running for state senate on the issue of a state bank
• The MA senate is introducing similar legislation
• IN VT, a House committee is exploring the issue.

Bob had to leave early to run the Finance Committee hearing on the revenue bill, and was not able to hear most of the testimony. I actually got there early enough to sign in first for an 8AM hearing. I wanted to formally offer the 11th LD’s support to Representative Hasegawa (also cosponsored by Representative Hudgins) for this innovative legislation, and just made a few brief points—
• There is a great deal of public outrage over bailouts and banker bonuses
• Despite that and record-low interest rates, banks lending less than ever
• More individuals are participating in the Move Your Money campaign, moving their own funds into locally-owned banks and credit unions http://moveyourmoney.info/
• Public money should consider doing the same: it’s our money!

There were a number of other witnesses testifying in favor. Sarajane Seigfriedt (co-chair of the King County Democrats Legislative Action Committee) summarized the issue as it will be included in the King County Democrats platform. Sustainable growth advocate Brian Derdowski pointed out that participation in secondary markets is a direct boost to community banks, that it could raise our state’s bond rating, and that it opens up revenue options without taxation. Cindy Cole of the 34th LD read a written statement that she sent to me. (If you want a copy, email me.) She is a member of a study group organized by Seattle Fellowship of Reconciliation that has been meeting since the financial collapse of 2008 to study banking and its effect on our economy and ecology. As a result, they met with Bob and did research that aided in writing this legislation.

The most significant testimony against was given by the State Treasurer, Jim McIntire, who would be tasked with implementing the legislation. He raised the issues of safety, liquidity and return, stating that our actual revenue from interest was closer to $160 million than to $4 million. He wants to keep the recently imposed (post-WAMU implosion) requirement of 100% collateral instead of the 10/1 deposit leverage that the BND uses. Could the bank meet both federal and state requirements for capitalization? Would a constitutional amendment be required first? Would withdrawal of fund from existing banks threaten their liquidity? I’d suggest arranging a chat with the ND State Treasurer to reassure McIntire on these issues.


There is a good article on the state bank issue from the Northwest Progressive Institute
http://www.nwprogressive.org/weblog/2010/03/washington-state-bank-progressive.html

The Progressive States Network has a good overview of progressive monetary policies that are being implemented at the state level. http://www.progressivestates.net/policy/issue/215

[eridani]

5. Observations from Cindy of the 34th LD

Statement: Hearing for HB3162 before the Washington State House Financial & Insurance Committee March 2, 2010.

Summary: HB 3162 would establish a state bank modeled after the Bank of North Dakota which could create billions of dollars in new credit for Washington citizens and return millions to the general fund.

Thank you for the opportunity to speak at this hearing. My name is Cindy Cole. I am a member of a study group organized by Seattle Fellowship of Reconciliation that has been meeting since the financial collapse of 2008 to study banking and its effect on our economy and ecology. We learned about the concept of a state bank in December of 2008 and were intrigued. Last fall we heard that Representative Hasegawa was considering introducing a bill to create a State Bank of Washington, several of us met with him and our committee did research that aided in writing this legislation.

The State Bank of Washington is modeled on the Bank of North Dakota. This state bank has functioned very well in North Dakota for years. Therefore, we know the concept of a state bank is a viable one.

The following information is taken from the Bank of North Dakota’s website.

http://www.banknd.nd.gov/about_BND/index.html and from an interview in Mother Jones with the President of the Bank. http://motherjones.com/mojo/2009/03/how-nation%e2%80%99s-only-state-owned-bank-became-envy-wall-street Also I refer to statements from the web sites of the North Dakota and Washington State governments about their revenues.

I am going to speak about the Bank of North Dakota, since HB3162 is modeled after this bank. By law, all state funds and funds of state institutions and local governments must be deposited in the Bank of North Dakota. The taxes collected by the state are the deposit base of the bank. The Bank of North Dakota makes loans based upon the amount of its deposits using the same fractional reserve system that all banks use.

An interesting aspect of the Bank of North Dakota is the way it partners with over 104 private banks in the state. It does much of the lending as a partner with a local bank. The local bank originates the loan and the Bank of North Dakota participates in the loan and shares the risk. So the state bank actually helps small private banks in North Dakota prosper. It can also originate loans on its own to farmers, home buyers, businesses and students. We think that it is important that loans are made to small businesses and agricultural projects within the State of Washington and HB3162 should reflect this. We hope it could help launch new green jobs for the Washington economy.

The Bank of North Dakota also acts like a mini-Fed, helping private banks with liquidity and it does check clearing for many of them as well as for many municipalities around the state. It is itself a member of the Federal Reserve, but it is not insured by the FDIC. If you think about it, because the state retains the power to tax and tax money must be deposited in the bank, there is no possibility of a bank run. Also, the bank is managed very conservatively. It did not do sub-prime lending, derivatives trading nor did it engage in any of the other risky behaviors that caused the crash. We believe that safeguards need to written into the bill and in the rules of the bank so that risk is minimized.

What could a Bank of Washington State accomplish for economic development, job creation and the fiscal health of our state if it followed the Bank of North Dakota model?

Once established, the State Bank of Washington will not only foster economic development in Washington State but it will pay its own operating costs and any profits can be given as dividends to the state, its only shareholder. I will give you some rough numbers. The revenue forecast for the state of North Dakota for the biennium 2009-2011 is $2.6 billion while the revenue forecast for Washington State from all sources excluding Federal grants for the biennium is $52.3 billion. That means Washington State has access to about 21 times the amount of tax revenue of North Dakota. The Bank of North Dakota loan portfolio in 2008 was $2.6 billion, so using the number 21 as a multiplier, a State Bank of Washington after a few years of operations, could loan out to its citizens $54 billion. That is a huge amount of new credit the citizens and businesses of our state could access.

Unlike a private bank which must, by law, make as much money for the stockholders as it can, the Bank of Washington State has other purposes. It will plow funds back into the state for productive ventures rather than putting the tax money not immediately spent into “investments” with private banks, many which are large out of state banks. And those private banks may use the monies as a deposit base for loans to speculators, loans for corporate mergers or loans for corporations to move factories offshore. That deposit base will, through the creation of a state bank, remain in Washington. Also, because it is not a private for-profit bank, the Bank of Washington State can make low rate interest loans to achieve its mission.

To help offset taxes in North Dakota part of the earnings the bank makes on the interest and fees it charges for its loans and services goes back to the state legislature as part of the general fund. Last year the bank returned $30 million to the state. A comparable figure for Washington State is $630 million. In 2001, the State of North Dakota did have a budget deficit, so the Governor, who sits on the Board of the Bank, got the bank to declare a dividend from its many years of retained earnings and they made up the shortfall. The State Bank would function as a buffer to an economic downturn in Washington State.

In conclusion, a State Bank is a wise investment for the people of Washington. Thank you.

Cindy Ann Cole


Observations on testimony

Jean Darsie and I (Representing the Fellowship of Reconciliation Just and Sustainable Economy Committee )gave testimony today at the hearing before the House Financial Institutions and Insurance Committee concerning HB3162 establishing a State Bank. We carpooled with Sarajane Siegfriedt who is on the King County Democratic Legislative Committee and has done lobbying in Olympia.

Bob Hasegawa gave a power point presentation about the Bank of North Dakota (BND) and John, you will be happy to know, that he even showed a short portion of the video we gave him about the State Bank of North Dakota highlighting the President of the bank and the Governor stating how it had been very good for the state.

His presentation highlighted how the state bank was keeping resources in the state, had one location and was the best use of tax payer $. He also highlighted other states that are looking into establishing state banks: New Mexico, Idaho, Oregon, Michigan, Florida.

He also quoted two bankers from local community banks in North Dakota who stated that the State Bank has good relations with the private banks of the state and they did not feel there was competition.

He acknowledged that the Washington State Treasurer, McIntyre, was concerned about the governance in the bill and that the bill still needs work. There needs to be adjustments so that community banks do not feel the loss of the state’s investments in their banks and also the loss to the state of the $4 million in interest needs to be addressed.
Bob Hasegawa mentioned that the 100% collateral rule passed last year needs to exempt the State Bank.

We heard that the Speaker, Frank Chopp is interested in the bill.

Questions brought up by a Republican, I am sorry I did not catch her name. she was concerned that a State Bank would be unfair competition for private banks. She also questioned that those who first set up the bank of North Dakota were socialists and failed farmers. Hasegawa said that the party that established the bank was the Non-Partisan League and that the BND worked in partnership with private community banks. Another concern was that the times are different now from when the BND was established and why is there only one state that has a state bank since it was established in 1919. Must not be very good.

The Treasurer of the state, Jim McIntyre, had the most comprehensive concerns and I know that I was not able to write them all down nor understand some of them.

He is most concerned about the safety of the state’s money, which is his job.
He is concerned about capitalizing the bank, where will the money come from to establish the bank at this time of deficits.
He contradicted Bob Hasegawa and said that the state now gets $160 million in interest from community banks, not $4 million.
Problem, that last year the legislature passed a 100% collateral rule.
He said HB3162 would allows private investors. ( Answer: We agree that private investors should not be allowed for the State Bank and the bill can be changed to make this explicit.)
Liquidity is a problem as the Bank could tie up tax dollars that need to be used. (answer: If the bank is allowed to use the fractional reserve system that all other banks can use, a lot more money will be created that the state can use. )
The Treasurer is wary about the constitutional amendment that will be needed ( Answer: The constitution can remain as written except that the State Bank can be exempt from the provisions that deny the right of the state to extend credit)
Investments should not be limited by Geography, investments should be diverse.
Because Bank exempt from State and Federal Taxes as well as FDIC insurance will pose unfair competition to other private banks.
Questions what the bank will be used for: Real estate, mortgages, local government, loans that other banks will not do?
He thinks that we are doing good now and taking care of taxpayer money, He recommends that the Legislature not establish a State Bank.

Another Legislator wondered how we would come up with the capital to start a bank. Right now the State is short on funds. Rep Parker asked, “How long before it would be profitable . Another concern was that the Legislature could tell the bank what to do, could they take over another bank?

Jean and I gave our statements, as did other interested parties. Some of the Treasurer’s concerns were addressed by Martha Koester of the 11th Legislative District.

Brian Derdowski, I hope I have spelled his name correctly, gave a very good testimony and brought in personal stories from his clients about how credit is very tight. Some banks have lots of cash but are unwilling to lend it because they need it for their own ratings.
He pointed out that the state could save $100,000 in interest costs, that we collect 3 % interest now but that we could leverage $100 million and then make lots more $.
With a State Bank we could increase the bond rating of the state and raise new revenue without raising taxes. Right now states are selling off assets to raise capital, we would not have to do that we could use those assets as collateral to leverage into loans. (We mentioned this to Bob Hasegawa when first talking to him about the state bank but his advisors were wary of this.)
Contrary to the Treasurer, Mr. Derdowski said the bank would diversify the investments of Washington State.
He offered to work with the Treasurer and the House Financial Institutions and Insurance Committee on legislation for a State Bank of Washington.

Someone mentioned that the capital requirement would be 20 million to start using an inter-fund transfer and then leverage that to build a State Bank.

The Constitutional Amendment should be narrowly crafted.

Sarajane testified that the King County Executive committee has put establishing a State Bank of Washington in their platform. She mentioned that 70% of new jobs come from start ups, but that now there is no credit to do that. It is urgent that we get credit flowing.
The State Bank will be a bankers’ bank, it will not sell stock, it is part of the solution for revenue, keeping college affordable and can be used in disaster relief as has the BND.

An antique dealer spoke and said that he had been pushing the chairman of the committee for a year to bring this up. He said that the last six months has been very difficult for his business but it seems to finally be getting a little better. He feels that a state bank is important for Washington’s future. He also mentioned that “State Bank of Washington” is the name of another private bank in Washington State. (John and I, in our draft of the bill called the state bank the “Bank of Washington State” because of this very reason, however, the aides who re-wrote the bill changed the name., just tooting our horn, )

We were encouraged by the testimony of Skip Chilberg, Spokane County Treasurer. He had similar concerns of Jim McIntyre but said that he was encouraged by the concept. He feels there is a crisis in credit. He has lots of experience in banking. His counties investment income has dropped 80%. He is very concerned about the Federal level, that we are dependent on the Chinese and Arabs for credit. He thinks that concerns can be worked out and he is willing to work on the bill with the house committee.

Representatives from the Banks and Credit Unions testified and are very concerned about unfair competition that the State bank would pose, especially because it would be exempt from taxes and FDIC insurance payments. Argued that North Dakota is a very different state than Washington.

Stacy from the credit unions said that she knew very little about the State Bank. She therefore called her counterpart in North Dakota and asked. She said that the BND is helpful to credit unions and acts as a mini fed, 60% of student loans in the state are done by the BND. She thinks the bill needs work and that credit unions need to be represented on the 11 member advisory board. Credit unions can now only make $1 million in loans with a reserve of $100, 000. Before the crash they could loan up to $2 million.

The last word was from a banker who said that capitalization was very difficult and that they should not take 8 billion from the private sector, the legislature needs to go another way. (mmmm)


Regards,
Cindy

[eridani]

6. TruthOut article

http://www.truthout.org/the-growing-movement-publicly-owned-banks57812

The State Bank of Washington

A similar bill, HB 3162, was introduced to the Washington State Legislature on February 1. The bill has generated so much interest that Steve Kirby, chair of the Financial Institutions and Insurance Committee, has scheduled a special work session on it. According to John Nichols in The Nation, the State Bank of Washington was formally proposed by House Finance Committee Vice Chair Bob Hasegawa, a Seattle Democrat. Nichols quotes Hasegawa:

Imagine financing student aid, infrastructure, industry and community development. Imagine providing access to capital for small businesses, or otherwise leveraging our resources instead of having to do it with tax incentives. Imagine keeping our resources local instead of exporting them as profits, never to be seen again - that's what this bank could do.

Leveraging rather than taxing is how private banks have been creating "credit" for centuries. States could do the same thing, cutting the middlemen out of the equation, saving significant sums in interest and fees and generating revenue for the state.

A nonpartisan analysis of the Washington bill prepared for the state legislature noted that the bank would be the depository for all state funds and the funds of state institutions, and that these deposits would be guaranteed by the state. The bank would be run by a board of 11 members

[eridani]

7. Fellowship of Reconciliation is having a workshop on state banks 4/17 (among other things)

Our workshop is this Saturday, April 17th. The Spring Assembly is being held at Fauntleroy Church in West Seattle, 9260 California Ave SW. Registration at 9:00, $15.00. Coffee and Continental Breakfast. Meeting of Western Washington FOR 9:30 (what has been happening). Workshops, (ours included) start at 10:30. 12:00 Break for Lunch, then some other workshops in the afternoon. More information at www.wwfor.org.

[eridani]

8. More arguments in favor

http://www.truthout.org/banks-profit-near-zero-interest-rates-another-reason-states-own-their-own-banks60176

While individuals, businesses and governments suffer from a credit crisis created on Wall Street, the banks responsible for the crisis are tapping into nearly-interest-free credit lines and using the money to speculate or to make commercial loans at much higher rates. By forming their own banks, states too can tap into very low interest rates, and can buffer themselves from another Lehman-style credit collapse.

Keeping interest rates low is considered the first line of defense for central banks bent on easing the credit crisis and getting banks to lend again. The Federal Reserve's target for the federal funds rate - the overnight interest rate that banks charge each other - has been kept at a rock-bottom 0% to 0.25% ever since December 2008. A growing number of economists now think it could stay there well into 2011 or even 2012, prompted by fears that a spreading debt crisis in Europe could hurt a budding U.S. recovery.

Dirk van Dijk, writing for the investor website Zacks.com, explains what a good deal this is for the banks:

"Keeping short-term rates low . . . is particularly helpful to the big banks like Bank of America (BAC) and JPMorgan (JPM). Their raw material is short-term money, which is effectively free right now. They can borrow at 0.25% or less, and then turn around and invest those funds in, say, a 5-year T-note at 2.50%, locking in an almost risk-free profit of 2.25%. On big enough sums of money, this can be very profitable, and will help to recapitalize the banking system (provided they don't drain capital by paying it out in dividends or frittering it away in outrageous bonuses to their top executives)."

This can be very profitable indeed for the big Wall Street banks, but the purpose of the near-zero interest rates was supposed to be to get the banks to lend again. Instead, they are investing this virtually interest-free money in risk-free government bonds, on which we the taxpayers are paying 2.5% interest; or are using the money to engage in the same sort of unregulated speculation that nearly brought down the economy in 2008, or to buy up smaller local banks, or to pay "outrageous bonuses to their top executives." Even when banks do deign to use their nearly-interest-free funds to support loans, they do not pass these very low rates on to borrowers. The fed funds rate was lowered by 5% between August 2007 and December 2008; yet the 30 year fixed mortgage rate dropped less than 1%, from 6.75% to only about 6%.

[eridani]

9. Sign up to be on Rep. Hasegawa's State Bank list

Saturday June 5, we were able to meet with Bob Hasegawa, the first sponsor of the bill HB 3162 2009-2010 to establish a state bank in Washington State. We attended his town hall meeting. We were very encouraged by this meeting. Bob said the Majority Leader of the House, Sam Hunt, told him there is a good chance the bill could pass in next year’s regular session. Bob said a state bank is a top priority for him. He will be meeting soon with other legislators from the Progressive States Network who will form a committee on the idea of state-owned banks.
http://www.progressivestates.org/

Between now and the next year’s session, he encouraged us to be talking to our state legislators. We need to educate them and the general public about a state bank. Bob will speak to your group about a state bank if you organize the meeting. See his homepage to contact him. http://housedemocrats.wa.gov/members/hasegawa/

hasegawa.bob {at} leg.wa.gov
Subject. Please sign me up for Bob's state-owned bank stakeholder list.

On his homepage, you also can sign up to get e-mails about progress about bill as a stakeholder by clicking on the right hand side, bottom of the home page where it says. To be added to Bob's state-owned bank stakeholder list, write to. hasegawa.bob {at} leg.wa.gov
Subject line. Please sign me up for Bob's state-owned bank stakeholder list.


Over the weekend, Cindy and I also met with Marcee Stone who is running in the 34th for an open seat. She is on board at this point. We have appointments to meet with the Eileen Cody and Sharon Nelson (Sharon is running for State Senate in the 34th.) We think this is a good time to start talking to your district’s politicians. Their ears are open during election season. We need these people to get a bill passed through the Legislature.

We also met with Craig Salins of WashClean, the organization working for public-funded elections. He gave us some ideas and encouragement.

We were sent a link last week with a good 4 minute video about the Bank of North Dakota.
http://www.youtube.com/watch?v=r0rJWnRFUJA Our contacts through this listserv have been very helpful. For example, that is how we learned about Bob’s meeting and about the You Tube video. Thank you.

Sincerely,
John and Cindy

[eridani]

10. Talking Points for a State Bank – Invest in Washington

1. There is a great deal of public outrage over bailouts and banker bonuses.
And banks on the national level have not been adequately regulated to prevent future risky lending and investments. Now despite record low interest rates, banks are lending less than ever.

2. The State of Washington is running huge deficits that cause public programs to be cut, negatively impacting Washington’s citizens.

3.. A Bank of Washington State would have the ability to self-fund capital projects, keep money local, subsidize student loans and provide new credit sources.

4. Our plan is to introduce a bill in the Washington State Legislature to charter a Public Bank, the Bank of Washington State. This is a Public, not for profit bank.

5. The Mission is written into the law establishing the bank: Develop agriculture, industry and commerce in Washington State.

6. All tax moneys and fees of Washington will be deposited in the bank. The bank would be a member of the Federal Reserve so that it could have access to the cheapest money available through the Federal Reserve Discount Window.

7. By using the deposits of the bank to make long term loans to small business and helping small farmers, jobs will be created; this in turn will increase the revenue tax base of the state.

8. The Office of the State Treasury uses tax monies now for short term investments in big banks, Federal treasury bonds, Fanny Mae etc. Instead the monies would be invested in long term loans to business here in Washington State.

9. The chartering of a public state bank will not solve all the problems of the recession. However, there is a credit problem in Washington State at the present time and the bank will get credit flowing to where it is needed.

10. The model the bank would follow is the one in North Dakota. The Bank of North Dakota (BND) has helped north Dakota prosper even during these recession times. The bank is conservative and did not participate in risky behavior. North Dakota is the only state in the Union that is not suffering a deficit budget and they have very low unemployment. www.banknd.nd.gov/

11. Like the BND the state bank of Washington would partner with community banks and credit unions in their loan practices. The BND is well thought of by banks in that state and acts as a “mini-Fed” where banks can go for low cost loans.



Project of Western Washington Fellowship of Reconciliation Just Sustainable Economy Study Group. www.justsustainableeconomy.org/

[eridani]

11. Talking to our State Representatives and State Senators

In talking with our State Representatives and State Senators, Bob Hasegawa suggested we avoid focusing on the concept of a “state bank” as much as possible and instead focus on how we want to redirect the state’s investment policy for that is the whole intent of this reform. This is the advice Bob got from the powerful House Speaker Frank Chopp.

Currently all state money not immediately spent by the state is invested by the Office of the State Treasurer. The Office of the State Treasurer website has a page labeled “The Year at a Glance”. http://www.tre.wa.gov/documents/annualReports/ar09-6_year.pdf There it is reported that the average daily investment balance of state money in 2009 was $4 billion dollars. And the average investment balance of local government (e.g. county) money which is also managed by the Office of the State Treasurer is $7 billion. Most of this money is invested in short term instruments, 1 to 30 days, 31 to 60 days and 61 to 90 days for example with large out-of-state governmental and private financial institutions. These investments are considered very secure, but they have also most recently helped finance the world-wide real estate bubble.

The “Invest in Washington” (tentative title) Act (hereafter The Act) would instead charter a bank which would be the depository of the state and local government tax receipts. The bank is thus a means to an end not an end in itself. This bank would also become a member of the Federal Reserve so that it could have access to the cheapest money available through the Federal Reserve discount window. With this access, it could begin to loan money to farmers, local business, and students in Washington State for productive use and for longer periods. That is the desired end or intent of the bank.

How could a bank loan money for longer terms when that money would be needed, generally within 90 days for state expenses? With the average daily balance of today’s Office of the Treasury at $4 billion, then, we know tax receipts will be coming in throughout the year just as the state is paying its bills throughout the year. That flow of money into the state bank from taxes and fees plus the ability of the state bank to access the Federal Reserve discount window would allow the bank to make long term investments (i.e. loans) in local productive economic activity. The Act must insist that the bank be extremely conservative in its loan practices since this is taxpayer’s money. We hear, mostly from farmers and small business, there is a credit shortage for farmers and small businesses but opponents of this idea, mostly bankers, say there is a customer shortage. Whatever the case, if there is not enough credit-worthy farmer’s and small businesses in Washington State, the state bank can continue the practices of the current Office of the Treasurer.

The mission of the bank will be to finance productive economic activity here in Washington State rather than maximize profits for the state. That mission will be written into the law. The current version HB # 3162 2009-2010 states: “The mission of the state bank of Washington is to promote agriculture, education, community development, economic development, commerce, and industry in Washington State”. The bank can also partner with community banks here in Washington State like the Bank of North Dakota does with community banks there.

_______________________________________________________________________

Unfortunately, we may be in the similar situation as the Bank of North Dakota found themselves in from 1919 to 1939 where the economy, especially in their case, the farm economy, was so depressed that the new Bank of North Dakota could not function as its founders intended. Instead of helping farmer’s get cheap credit in the 1920’s and 1930’s, the Bank made loans and later foreclosed on thousands of farmers. That certainly was not the intention of the founders. It was only much later, in the 1940’s and 1960’s when the economy improved that the Bank began to really help the citizens of North Dakota. We might need to start thinking about more powerful medicine to heal our ailing economy, medicine that can only be applied at the Federal level.

Currently, we face political gridlock. The progressive left wants to follow the advice of Stiglitz and Krugman, Keynesians, who suggest more economic stimulus which would increase the national debt at least in the short run and which assumes more growth must occur in the long run so the debts can be paid down later. But the environmental movement questions whether we can tolerate more growth in the future, particularly the kind of growth we have most recently experienced.

Basically we have been following the Keynesian approach since the end of WWII, mostly in the form of “military Keynesianism”, especially during the Bush Administration who started two wars and cut taxes at the same time. But we did not get the robust economic growth the theory predicted, probably because the spending was on non-productive uses i.e. war and wealth became very concentrated at the top. In addition, we had the successful movement to deregulate finance and to globalize corporate manufacturing. As a result we got a financial crisis and a severe economic crisis. The bailouts and the continuing recession (with fewer tax receipts) have massively increased the deficits and we are seeing severe cuts in education and health care at the state level. Currently the right wing is screaming about the deficits which make it very difficult to get more economic stimulus passed now. I fear the “Great Recession” will be long for those at the bottom end of our society.

There are ways out of this gridlock but they would require a political shift. We progressives know that one way is to return to more progressive taxation at the state level (Initiative #1098) and Federal level (let the Bush tax cuts for the wealth expire). Both those efforts may succeed. But much more may be required to move us toward a just and sustainable economy.

We saw the videos that showed our money supply is being created by the private banking system by means of the fractional reserve system, money as debt. What is the solution to this problem? David Korten in the first edition of Agenda For A New Economy(2009) makes point 12 of his 12 point program: “Transfer to the federal government the responsibility for issuing money” (p.142). Ed Dreby in the Quaker Eco-Bulletin entitled “Money and Growth: Another Inconvenient Truth?” writes on page four: “Governments could reclaim their traditional monopoly of issuing money which would be interest free.” Korten references Stephen Zarlenga’s book The Lost Science of Money (2002 with addendum from April 2010) which is a massive historical study of money systems throughout (mostly) western civilization showing the very long-term effects of the various systems. When the money system is based on wealth like gold or silver or even agricultural products, the wealthy who have the most control the society. When the money system is based on bank credits (like ours) the bankers control the society. When the money system is based on law, then, at least potentially, the society has its fate in its own hands. Zarlenga thinks that the source of most of our problems, from wealth concentration (and all the social problems that follow described by Wilkinson and Pickett) to the current financial and economic crisis is due to the fact that our so-called “democratic society” does not issue most of its own money for the common good. His group, the American Monetary Institute http://www.monetary.org/ has written the American Monetary Act which will do three things; 1) Restore the power to create money to the Federal government 2) Take away the power of banks to create money by prohibiting the practice of fractional reserve banking, and 3) Have the Federal Government buy down its debt with newly issued interest free money and have the Congress spend new money by rebuilding our physical and energy infrastructure including our healthcare and education systems. Dennis Kucinich will introduce the American Monetary Act.

Project of Western Washington Fellowship of Reconciliation Just Sustainable Economy Study Group. www.justsustainableeconomy.org/

[eridani]

12. Report on the state bank, Oct 11, 2010

Cindy and I met with Rep. Bob Hasegawa on October 6th about a state bank. He has been contacting many legislators including the Speaker of the House and State Senators, stakeholders like community bankers as well as the president of the Bank of North Dakota. We were impressed with his dedication to this project. He now sees the state bank as a longer-term project that can only produce results after several years of operation. It will need to be capitalized with bonds to start and it will take several years to become fully functional.

The Bank of North Dakota could not change the low prices the farmer’s faced in the 1920’s nor could it prevent the effects of the Great Depression in North Dakota. It did not, however, evict farmers from foreclosed farms. People stayed in their homes and were able to buy back their farms from the bank when good economic times came again. In the present, the bank has been able to help the North Dakota economy through the current crisis. Unemployment is low there relative to most of the country, state government is in the black and not one of their community banks has failed. The Bank of North Dakota helped community banks there with their portfolios as the current crisis was developing.

Bob has been able to educate the staff at the Washington State Legislature so they are now more up-to-speed on the concept of a state bank. They did not seem to understand the North Dakota model and it showed in the bill they wrote last year. Also, his vision for a bill this year will accomplish several things. It will set up the basic concept of a bank’s governance: a Board of 3 to 5 state-wide elected officials with an Advisory Board made up of banking experts and community representatives. The banks constitutionality is assumed. The bill will also outline the clear intent of the legislature in setting up a state bank as a bank to promote commerce, business and agriculture for the benefit of the health and welfare of the citizens of the state. In the balance between protecting the tax payer’s money and developing the state’s economy, protecting the taxpayer’s money must come first.

A basic outline of the structure of the bank will be included in the bill; however, the new bill will set up a blue ribbon commission to hammer out the details of the state bank within a certain deadline. Washington State is very different than North Dakota and the bank, although using the North Dakota model, is to be tailored to the needs of our state. Bob was very pleased to learn that retired officials of the Bank of North Dakota seem willing to help such a commission. He also expressed a need to find local banking experts who can help with the details of establishing a bank of Washington State. Finally, he said he was ready to hold community forums with the purpose of talking to the community about the concept as well as getting feedback from the community. So, we should start contacting people who can organize forums.

John Repp

[eridani]

13. Report on a meeting of Oct 19, 2010 on the state bank project

On Tuesday, Oct 19, John attended a meeting Rep. Bob Hasegawa called to map out community outreach for the effort to establish a bank in Washington State on the model of the state-owned Bank of North Dakota (BND). Attending were about a dozen organizers from several unions and several community organizations. I really got the sense that the effort to establish a state bank is much bigger than I realized. Bob gave us an update on his progress. He intends to drop a bill by December 15 and expects it will have to go through three committees to reach the floor. He is lining up a Senator to sponsor a companion bill in the Senate.

After discussion, there was agreement that the most important next step is to find a Republican prime co-sponsor, maybe from a rural area where the lack of credit resources is hurting farming and small business. It was felt this would change the whole dynamic. Bob told us how the Republicans of North Dakota love their bank and once the actual functioning of the ND model is explained to R’s here, it may be possible for an R to jump aboard.

I learned that there is a group called Center for State Innovation http://www.stateinnovation.org/ that has written a 24 page report on the impact a state bank would have on Oregon and a similar report will be published for WA in a few weeks. When we get that report we will pass it on. We talked about the fact that BND is not insured by the FDIC; it was made clear that the reason is that the deposits of the state’s tax receipts and fees in the state bank is so much larger than the $250,000 limit that the FDIC is able to insure, it makes no sense for BND to pay the insurance. The same would be true of a bank here. Currently, the State of Washington deposits all its state money in a “concentration account” at the Bank of America which averages 5 billion dollars at any one time. (The Office of the State Treasurer then invests money not immediately used to pay the state’s bills)

Bob is still looking for a name for the bank. One popular suggestion at this meeting was “Washington Community Investment Bank”. Several of the attending organizers volunteered for tasks like bringing to the table other key players and finding stories of small business people or farmer’s who have been denied credit in the past few years.

John M Repp jmrepp {at} comcast.net


Regards,

Cindy

[eridani]

14. Reintroduced in 2011

http://www.truth-out.org/washington-state-joins-movement-public-banking67119

Washington State Rep. Bob Hasegawa, a prime sponsor of the Washington legislation, called the proposal for a publicly owned bank "a simple concept that will reap huge benefits for Washington." In a letter to constituents, he explained, "The concept (is) to keep taxpayers' money working here in Washington to build our economy. Currently, all tax revenues go into a 'Concentration Account' held by the Bank of America. BoA makes money off our money and we never see those profits again. Instead, we can create our own institution and keep taxpayers' dollars here in Washington, working for Washington."

Hasegawa said a key feature of the Washington banking institution is that it will work in partnership with financial institutions, community-based organizations, economic development groups, guaranty agencies, and others. He said the Washington Investment Trust will offer "transparency, accountability, and accuracy of financial reporting," a welcome change from the accounting tricks common among the large, Wall Street, money-center banks today.

A public hearing on HB 1320 is scheduled for Tuesday, January 25, at 1:30 PM. The bill is assigned to the Business and Financial Services Committee in the House and the Financial Institutions, Housing and Insurance Committee in the Senate.

For more information on the movement for publicly owned banks, see http://PublicBankingInstitute.org.

[LeFleur1]

15. Good Idea

BUT...North Dakota has a whole lot of oil that is contributing greatly to their economy.

[eridani]

16. So do Texas and Oklahoma, but they are not running surpluses

No bank failures in ND also.

[eridani]

17. Writeup on the Progressive States blog

http://progressivestates.org/node/26273#article3

At the basic level, a development bank is capitalized by state money, publicly governed, can serve as a depository for state revenue, and returns a portion of its profits to the state. Rather than sending state funds to big banks, the development bank would keep deposits in-state. As such, a development bank reduces state dependence on large financial corporations and allows states to invest dollars in local communities rather than line the pockets of Wall Street CEOs.

A development bank would also be a source of job creation. The Center for State Innovation finds that such a bank could create or save up to 13,500 small business jobs in Oregon - about 6,700 of which would be supported by the augmented loan activity and ability to invest in local industry that the bank would permit. It would also increase state revenues. In 2009, the Bank of North Dakota “delivered a $30 million dividend to the state.” Interestingly, North Dakota has one of the lowest unemployment rates in the country and is one of the states with a budget surplus in recent years.

Messaging: Recent polling indicates strong public and small business support for a development bank. In Maryland, people were asked, "The state of Maryland keeps billions in tax dollars in big out-of-state banks like Bank of America and M&T. Would you favor or oppose the state using these funds to create a public bank that will keep Maryland tax dollars at home, create more local jobs and support local banks that provide credit to small businesses in Maryland?" In total, 67 percent of respondents favored the idea, with 42 percent strongly favoring the policy. Further, MSA polling found that 75 percent of small businesses polled would support the creation of an Oregon state bank like North Dakota’s.

[eridani]

18. Well, back to the drawing board for 2012

Many of you may be aware of this already and I am sorry if it is a repeat. The Washington Investment Trust (State Bank) bills did not pass out of committee before the cut off date in February.

Our main opposition came from the Treasurer, Jim McIntire, and the fiscal note attached to the bill was based on McIntire’s idea of a state bank with many branches analogous to the Bank of America’s many branches which receives our state taxes and fees. It never occurs to McIntire that a state bank could have one office, like the Bank of North Dakota, and that businesses, for example, would transfer the tax receipts to the state bank office through their checking account just like they would pay any other bill.

McIntire is also convinced that a state bank would be unconstitutional. He said lawyers in his office are convinced of this. We wonder if they are constitutional lawyers. We do not agree. The clauses in the state constitutional stating that “credit not be loaned” are “‘to prevent state funds from being used to benefit private interests where the public interest is not primarily served.’ ” Id. (quoting Japan Line, Ltd. v. McCaffree, 88 Wn.2d 93, 98, 558 P.2d 211 (1977)). http://www.atg.wa.gov/opinion.aspx?id=23724 . We think a state bank will serve the public interest. Also, the constitutional argument put up by opponents ignores the fact that the state already loans money to private parties through several revolving loan funds..

McIntire also sides with the community banks who were not convinced that the state bank would not compete with them. We think the policy of not competing with the private banks should be written into the law.

We will be working on improving the language of the bills to deal with McIntire’s objections. We remain committed to keeping tax money invested in Washington State and buffering our state from the excesses of Wall Street Banks. We are also committed to educating people on this topic and building support for passage of legislation next year. The Working Families Party in Oregon is working on this issue and has a bill modeled on the Bank of North Dakota. Oregon’s Treasurer has offered a plan he calls a “virtual” bank. We think it is simply a centralization of their state’s revolving loan funds and is not a bank in the true sense. McIntire has a similar plan for the revolving funds of our state and wants to call it an “infrastructure bank”. Again this is not a bank that would allow all taxes and fees to be processed by a state bank and used for productive investment in the state. We think it would undercut the state bank idea. It would not use the fractional reserve system. This is the power the private banks want to use for themselves, the power they have abused when they crashed the global economy. There is lots to do.

Cindy and John

[rhett o rick]

20. Thank you for your efforts. nm

[pscot]

22. Let's remember McIntire's obstruction

when he's up for reelection.

[eridani]

19. Join Hasegawa and others on a State Bank conference call 3/24 at 6PM PDT

JOIN US for the LIVE Webcast Conference call on the State Bank Movement with some of its Rising Stars!
TODAY! Thursday, March 24, 6-7pm (Pacific)


Tomorrow, Thursday March 24 at 6pm (Pacific), Backbone Campaign will host a webcast conference call on the issue of State Banks featuring Rep. Bob Hasegawa, (WA), Jared Gardner of Oregonians for a State Bank, and Web of Debt author Ellen Brown of (CA). RSVP right now.

Ever since speaking with author Ellen Brown last year I have been curious about State Banks and their potential to be part of a viable alternative financial system. When combined with establishing or strengthening credit unions and community banks, appropriate taxation of (or dismantling of) the giant Wall Street banks, auditing and/or federalizing the Federal Reserve - this idea begins to make "Moving Our Money" - including our tax dollars - a much more realistic and powerful call to action.

"The current interest in financial reform has prompted a number of legislators and political candidates to explore the idea of state-run banks.

The Bank of North Dakota(BND)is the country's only state-run bank. Opened in 1919 with $2 million in capital, the Bank originally intended to help farmers by increasing access to farm loans. Today the bank operates with more than $270 million in capital operates primarily as a banker's bank, as a secondary mortgage market, and as a provider of agricultural, small business, and until July 1 2010, student loans.

Perhaps what has prompted the strongest push for other state banks has been the success with which BND has survived the economic downturn. The Bank of North Dakota earned a record profit last year, and even contributed $30 million of its profits back to the North Dakota General Fund." (From the Center for State Innovation)

So, I called the WA State Treasure's office last week to ask about their opposition to the WA State Bank legislation offered by Rep. Bob Hasegawa. His staff pointed me to Treasurer McIntyre's blog which actually quoted the Pres. of the Bank of North Dakota deflecting credit for that state's unique fiscal health.

We'll ask our guests to explain the idea of establishing a State Bank; speak to the necessary steps for doing so; and share with us strategies for moving forward. I'll also ask them analyze Treasurer McIntyre's position, as he would certainly be a key ally to move this idea forward in our State.

Below are links to a variety of articles, including an in depth analysis by the Center for State Innovation that recommends the State Bank as a positive economic tool. So RSVP right now.

In collaboration and gratitude,

Bill Moyer
Backbone Campaign


Three ways to participate:

1. CONFERENCE CALL: First, RSVP by email with "State Banks" in the subject line, so we can reserve a spot for you on the call and send you instructions for cueing up for "on air" questions in the chatroom. At the time of call, dial
1-[phone],

follow prompts and enter access code 1037729 followed by #.
and/or
2. WEB RADIO: Go to Voice of Vashon http://voiceofvashon.org/ and see "click here to listen" at the top right corner.
To ask questions while you listen, you will need to RSVP for a password and log in at the live chat.
and/or
3. Email: [e-mail]
Subject line: State_Bank

[BanzaiBonnie]

23. Please keep us updated on this effort

In Clark County, we amost feel more a part of Oregon because the disconnect between SW Washington and Olympia is so wide. The Columbian only minimally keeps us aware of activities in the capitol and around the rest of the state.

[BanzaiBonnie]

21. Thom Hartmann was just talking

about state banks this morning.

[eridani]

24. One last attempt at progress this year

Last month we sent out notice that the Washington Investment Trust bill 1320 did not make it out of committee. It is considered NTIB (necessary to implement the budget) which means it is not entirely dead this session but it is a very long shot. However, another bill has been drafted HB2040 Providing for assistance for financing infrastructure and economic development, a hybrid of HB 1320 and HB 1915 a State Treasurer’s request bill. HB 2040 is Prime Sponsored by Rep. Hans Dunshee who chairs the Capital budget Committee, to which the bill has been assigned. It has 28 co-signers. It creates a task force, similar to the previous bill, that will create an operational plan for a state agency that supports financing infrastructure, student loans and economic development. The task force will make recommendations back to the 2012 Legislative Session for implementation of that plan. Also this bill allows the State Treasurer to enter into contingent loan agreements with local governments.



Rep Bob Hasegawa of the 11th District drafted this bill and has asked that people contact their legislators to support it. A public hearing was held on April 5th and the only opposition was from the Bank Lobby. The bill has a sunset clause , a way to measure the progress of the taskforce and a clear set of results. It includes language that addresses the concerns of the State Treasurer and Bob hopes these adjustments make the passage of 2040 achievable this session.



Overall, it is a step in the direction of fulfilling some of the purposes of the Washington Investment Trust.

It is scheduled for a vote in the House Committee on Capital Budget at 8 a.m. on Tuesday, April 12, so it is especially important to contact members of that committee (see list of members and phone numbers below; email addresses are in the form: [e-mail]).



Capital Budget Committee Members

Representative
Room
Phone

Dunshee, Hans (D) Chair
MOD F 103
[phone]

Ormsby, Timm (D) Vice Chair
LEG 122G
[phone]

Warnick, Judy (R) *
MOD C 201
[phone]

Zeiger, Hans (R) **
MOD D 201
[phone]

Asay, Katrina (R)
MOD A 104
[phone]

Jinkins, Laurie (D)
MOD C 103
[phone]

Lytton, Kristine (D)
MOD B 203
[phone]

Moeller, Jim (D)
LEG 429B
[phone]

Pearson, Kirk (R)
LEG 122E
[phone]

Smith, Norma (R)
MOD A 202
[phone]

Tharinger, Steve (D)
MOD E 205
[phone]

[eridani]

25. New website for a state bank set up

Members and Staff of the House Infrastructure Financing Task Force:

A webpage has been developed for this Task Force. http://www.leg.wa.gov/JointCommittees/IFTF/Pages/default.aspx We will continue to update it as items become available.

[eridani]

26. Frank Chopp designates Bob Hasegawa as chair of state bank task force

I am happy to send you the following update on our progress toward the creation of a publicly owned financial institution. Most of you already know the pros for such an institution, so I'll jump straight to the update as I can't really think of any cons to mention.

As you may, or may not know, this last legislative session we were unable to pass HB 1320, establishing the “Washington Investment Trust” out of committee. However, I was able to re-work the bill into a new piece of legislation (HB 2040) and steer it through a different committee. While HB 2040 did not pass the House, it did have very strong support from the majority party and some support from the minority party. Speaker of the House Frank Chopp, who has been very supportive of this concept, instructed the creation of an interim Infrastructure Financing Task Force (IFTF) based on HB 2040. Its mission is to bring recommendations for the implementation of a financial institution to be owned by the people of the state of Washington back for consideration by the 2012 legislative session.

Speaker Chopp has appointed the members of the Task Force and I am pleased that he designated me as chair. Over the next few months we have a ton of work to do with very little time to do it. But the Task Force members are extremely qualified and I'm optimistic that we can reach a consensus recommendation for the 2012 session.

If you would like to learn more about the task force, our work plan, and the members, you can now visit the legislative website for the task force. The website will be continually updated as we make progress over the coming months.

Our first meeting took place on Monday, August 22, 2011. If you were unable to attend in person, TVW recorded the entire meeting and you can watch it online here. The Task Force will meet again in the coming weeks. Once the date is finalized we will send you an update. It will be in Olympia; if you are unable to attend in person, TVW will again be taping it and you will be able to watch the meeting online (it will be streamed live and it will also be archived for later viewing).

Also, I was a guest on KEXP’s “Mind over Matters” with Mike McCormick to talk about the Washington Investment Trust. You can listen to it online in the station’s archives, or you can go to my website and listen to an audio copy there. I have also uploaded the PowerPoint presentation on my website.

Thank you for your continued support and, as always, please keep in touch!

Bob

[eridani]

27. State Bank task force to meet in Olympia 9/19

There was a mistake on the last video concerning the web sites. It had to be pulled. YouTube does not allow the replacement of any video to it's original address. Tough break, but that's just the way it is. Sorry for the inconvenience if you relayed it on to friends or put it on web sites, please redo.



Here's the new link to the new State Bank video
http://www.youtube.com/watch?v=hxFRqGaRyXw


Dear supporters,
Our next Infrastructure Financing Task Force meeting has been scheduled for Monday, September 19th at 9:00 a.m. The meeting will take place in Olympia. There will be a brief period for public input, however a bulk of the meeting will be dedicated to specific agenda items. You can find the outlined agenda for the meeting here. If you can’t make it to Olympia TVW will be streaming the meeting live. Also, if you miss the meeting TVW will have the video archived for viewing at a later time.

Thank you,

Bob Hasegawa
Washington State Representative
11th Legislative District
http://www.housedemocrats.wa.gov/roster/rep-bob-hasegawa/
Hotline: [phone]
Phone: [phone]
Legislative Aide: Marissa Chavez
Olympia Office:
425 John L. O'Brien Building
P.O. Box 40600
Olympia, WA 98504-0600
360/786.7862

[rhett o rick]

29. Forgive me for coming in on this late. I dont spend enough time in the WAshington the State

forum. Who is on this task force?

[eridani]

32. Rest of the meeting dates set

We’ve also been receiving questions about the dates for upcoming meetings. Below is the link to the “Work Plan” page of the website, and dates for the next three meetings.

http://www.leg.wa.gov/JointCommittees/IFTF/Documents/WorkPlan.pdf

If you’re not sure what the taskforce is about you can read the previous update that was sent out to the listserv below.

Thanks again and as always stay in touch.

-Bob


Bob Hasegawa
Washington State Representative
11th Legislative District
http://www.housedemocrats.wa.gov/roster/rep-bob-hasegawa/
Hotline: [phone]
Phone: [phone]
Legislative Aide: Marissa Chavez
Olympia Office:
425 John L. O'Brien Building
P.O. Box 40600
Olympia, WA 98504-0600
360/786.7862



http://www.leg.wa.gov/JointCommittees/IFTF/Documents/WorkPlan.pdf

If you’re not sure what the taskforce is about you can read the previous update that was sent out to the listserv below.

Thanks again and as always stay in touch.

-Bob

[eridani]

28. REport on Bob Hasegawa talk in Renton 9/10

http://waliberals.org/bob-hasegawa-promotes-a-state-bank/2011/09/10/

Today at the Renton Library, State Representative Bob Hasegawa gave a presentation and talk about the efforts to establish a Washington state bank.

Hasegawa began by saying that there’s really no downside to creating a state bank. It’s a no-brainer. (Sigh, that means most Republicans will oppose it.) Currently, sales taxes and other general funds are deposited in an account at Bank of America. Why shouldn’t Washington follow the example of North Dakota and keep the funds locally? The funds would likely have lower management fees, and could be more easily invested locally. We’d reduce or eliminate debt service costs. Washington citizens could earn interest on any funds held unspent in the account. (Hasegawa said that nowadays, revenue can’t keep up with expenditures, so fund turnaound time is fast.)

[eridani]

31. Videos of the event

Here are links to footage of the talk Rep Haswgawa gave on Sept 10th at the Renton library. Please spread the information through your organization. I am sending it out to everyone I can think of.

Sincerely,
Patti Szot
Involved Democracy

Part 1- http://www.youtube.com/watch?v=Hmt1aCdGAgg

Part 2- http://www.youtube.com/watch?v=BCixD6OwajY

Part 3- http://www.youtube.com/watch?v=aNI0cjNxXCc

[eridani]

30. State bank legislation passed in CA

AB 750, California's bill to study the feasibility of establishing a state-owned bank that would receive deposits of state funds, has passed both houses of the legislature and is now on the desk of Governor Jerry Brown awaiting his signature.

It could be the governor's chance to restore the state to its former glory. As noted in Time Magazine:

"n the 1950s and '60s, California was a liberal showcase. Governors Earl Warren and Pat Brown responded to the population growth of the postwar boom with a massive program of public infrastructure--the nation's finest public college system, the freeway system and the state aqueduct that carries water from the well-watered north to the parched south."

But that was before Proposition 13, a California constitutional amendment enacted by voter initiative in 1978. Prop 13 limited real property taxes to one percent of the full cash value of the property and required a two-thirds majority in both legislative houses for future increases of any state tax rates.

Prop 13 radically reduced the tax base, and it would be difficult to raise property taxes now. The tax savings simply drove property prices up, getting capitalized into additional debt service to the banks. Today, a rise in property taxes would lead to even more foreclosures and abandonments, reducing tax revenues even more.

Meanwhile, the state is struggling to meet its budget with a vastly shrunken tax base. What it needs is a new source of revenue, something that won't squeeze consumers, homeowners, or local business.

A state-owned bank can provide that opportunity. North Dakota, the one state that currently has its own bank, is the only state to be in continuous budget surplus since the banking crisis began. North Dakota's balance sheet is so strong that it recently reduced individual income taxes and property taxes by a combined $400 million and is debating further cuts. It also has the lowest unemployment rate, lowest foreclosure rate and lowest credit card default rate in the country, and it hasn't had a bank failure in at least the last decade.

Revenues from the Bank of North Dakota (BND) have been a major boost to the state budget. The bank has contributed over $300 million in revenues over the last decade to state coffers, a substantial sum for a state with a population less than one-tenth the size of Los Angeles County. North Dakota is an oil state, but according to a study by the Center for State Innovation, from 2007 to 2009 the BND added nearly as much money to the state's general fund as oil and gas tax revenues did. Over a 15-year period, according to other data, the BND has contributed more to the state budget than oil taxes have.


Read more at
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