San Francisco voters approved a public bank. Here is what Prop. B sets in motion, and what it does not pay for

The charter amendment opens a path to a city-owned lender and, later, a public bank, but it provides no money, and the controller puts the cost of building both at $310 million to $460 million over eight years.

By Celia Marroquín

San Francisco voters have authorized something no American city has: a path to a bank owned by the city itself. What they have not done is pay for it.

Proposition B, a charter amendment the Board of Supervisors placed on the Nov. 3 ballot, led 167,369 votes to 151,353, or roughly 52.5 percent to 47.5 percent, in the Associated Press tally published by KQED on Monday afternoon. The measure trailed on election night and pulled ahead as late ballots were counted on Thursday, The San Francisco Standard reported. The results are unofficial until the Department of Elections certifies them.

The vote is a milestone for Supervisor Jackie Fielder of District 9, who co-founded the San Francisco Public Bank Coalition as an activist in 2017. What follows is a series of decisions, most of them about money. Here is what the measure does, in order.

Step one: a lender, not a bank

Prop. B authorizes the city to create a nonprofit “municipal finance corporation.” It may make loans but cannot take deposits. Its charter mission centers on affordable housing, small businesses and environmental projects, and the measure directs it to avoid industries it deems harmful, including fossil fuels, tobacco, weapons, prisons and detention centers and predatory lenders, according to a San Francisco Public Press analysis.

The corporation does not come into being on its own. The treasurer-tax collector must first determine that there is enough money and other resources to start it; the money would have to come separately, from appropriations, grants, foundations or banks.

The design keeps elected officials away from individual loans. A nine-member oversight commission would include four appointees of the Board of Supervisors, two of the mayor and one each from the treasurer-tax collector, the controller and the city attorney. The commission would help choose a board with banking experience to run the corporation but could not intervene in lending decisions.

Step two: a public bank, if regulators agree

After at least three years of operation, and a record of turning a profit, the corporation could apply to state and federal regulators, including the California Department of Financial Protection and Innovation, to become a public bank that takes deposits. It would be the first city-run public bank in the country.

The calendar is tight. The state’s authority to license new local public banks, created by the 2019 California Public Banking Act, is set to expire in 2028 unless the Legislature extends it, the Public Press reported. On the measure’s own timeline, a corporation that opened in 2027 could not seek a bank charter before 2030, which means the coalition’s path to a full bank likely runs through Sacramento as well as City Hall.

The cost question

Controller Greg Wagner’s Aug. 20 analysis for the voter pamphlet found that Prop. B by itself would not change the cost of government, because it does not require the city to create anything. If the city does proceed, he estimated that building the corporation and then a bank could cost $310 million to $460 million over eight years, using models from the city’s 2023 Reinvestment Working Group. His breakdown: about $4 million a year to stand up and staff the corporation, about $90 million to capitalize and fund it over its first three years, about $220 million to operate a bank in years four through eight, and $550,000 to $600,000 a year for oversight commissions.

The figures could be significantly higher or lower, he cautioned. Some capitalization could come from city grants and forgivable loans “which are unlikely to be repaid,” he wrote, and the corporation becoming financially sustainable “is not guaranteed.” He added: “There may be significant unforeseen costs to the city in the event the Public Bank is not financially sustainable.” Because the commissions and boards would have “a high degree of independence,” he noted, the city would have limited control over how funds are used.

The arguments, for and against

Supporters say a public lender could offer cheaper financing to affordable-housing developers, small businesses and climate projects, often working through local banks and credit unions. “A public bank can help reduce pressure to raise taxes and issue bonds by providing steady, long-term financing for core public infrastructure,” read the official ballot argument signed by state Controller Malia M. Cohen, Assemblymember Matt Haney, Board President Rafael Mandelman and Supervisors Myrna Melgar, Matt Dorsey and Bilal Mahmood.

Opponents question both the money and the need. Supervisor Stephen Sherrill, who with Supervisor Alan Wong voted against placing the measure on the ballot, called it “redundant,” KQED reported, and told the Public Press it was “a slow, costly answer to problems we could be solving right now with tools the city already has.” Mr. Wong said it asked voters “for trust the city has not yet earned.” Mayor Daniel Lurie opposed it, arguing the city should invest directly in housing and small businesses rather than build a new institution.

Marie Hurabiell, founder of ConnectedSF, noted that the Bank of North Dakota, the country’s only state-owned bank, has a built-in deposit base because state law requires state funds to be kept there. “San Francisco is proposing something much riskier in a tighter budget with no such captive funding,” she said. The North Dakota bank, founded in 1919, earned $231.8 million in 2025.

The largest donor to the Yes on B committee was former congressional candidate Saikat Chakrabarti, who gave $150,000 of the $164,030 reported as of Sept. 23; GrowSF and Neighbors for a Better San Francisco opposed it.

What to watch

The next steps are certification of the vote; any move by the treasurer-tax collector to declare that resources are sufficient; and, most consequentially, whether Mr. Lurie and the Board of Supervisors appropriate start-up money in a future budget.

The offices of Supervisors Fielder, Sherrill and Wong, the San Francisco Public Bank Coalition and GrowSF did not respond to The Inquirer’s requests for comment on Monday.