Get the Facts

Measure Z's parcel tax is dedicated entirely to capitalizing the public bank. It can't legally be spent on anything else, and it doesn't touch the general fund. In fact, a public bank is designed to ease pressure on Berkeley's budget over time: once capitalized, it becomes a self-sustaining, revenue-producing asset that returns profits to the city, rather than a program Berkeley has to keep funding year after year. See how the tax dollars are structured and protected →

Berkeley isn't just paying into this bank; Berkeley is becoming an owner of it. A bank makes money by making loans, and the amount it can safely lend is tied directly to the size and diversity of its capital base. A larger, regionally diversified loan portfolio is lower-risk and more profitable than one that only lends in a single city. As an owner, Berkeley shares proportionally in that profit and stability. The long-term goal remains a fully regional bank, co-capitalized by Oakland, Richmond, Alameda County, and other jurisdictions, which would reduce the share Berkeley carries over time.

The tax rate is designed to keep pace with inflation so that Berkeley's investment retains its real value over the life of the measure, rather than quietly eroding. And because the goal is a bank that becomes self-sustaining and profitable within its first few years of operation, the underlying intent is to reduce Berkeley's need for new taxes over time, not to lock in indefinite tax growth.

Getting a new bank chartered is a genuinely rigorous, multi-year process, and it should be. But this isn't a leap into the unknown: California law explicitly authorizes public banks, Public Bank East Bay has an independently vetted business plan and qualified board candidates already identified, and the campaign is in active conversations with regulators. The measure also includes a safeguard: if the bank isn't authorized to operate by the ordinance's deadline, every dollar raised must still go toward affordable housing, green infrastructure, and small businesses so it won’t go towards general city spending or be wasted.

Those programs matter, but they work differently. IBank lends once from a fixed pool of state capital. SBA loans still require a private bank willing to originate and hold them. The SBA guarantees the loan, it doesn't replace the private lender's decision. Municipal bonds fund a single project and don't recycle; once spent, that money doesn't come back to lend again. A public bank is different: it holds deposits directly and re-lends that same base of capital again and again, filling gaps for borrowers — like community land trusts, employee-owned businesses, and small and mid-sized local companies — that existing programs often can't reach.

Public banking isn't an experiment; it's a century-old, proven model. North Dakota's public bank has operated successfully for more than 100 years and remains highly profitable for the state. Public Bank East Bay's business plan, capital structure, and lending priorities have been independently vetted, and the same regulatory and capital requirements that apply to every FDIC-insured bank in the country will apply here too.

The public bank won't be run by City Hall staff or elected officials. It will be run day-to-day by experienced, professional bankers who carry the same fiduciary duty, licensing requirements, and regulatory oversight as any other bank in the country. Elected officials and community members hold seats on the governing board that sets policy and lending priorities, but the institution answers to bank regulators first, exactly like every bank does.

The board overseeing the bank includes financial experts and community members alongside elected officials. And every board meeting, annual report, and major decision is open to public review. That's more transparency and accountability than Berkeley's money gets today, sitting inside a private bank where residents have no seat at the table at all.