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Oakland Drops Chase Bank Contract, Then Reverses D...

Oakland Drops Chase Bank Contract, Then Reverses Decision

 

Council cited possible pipeline investment, failure to serve Black community for canceling

 

Council members voted last week not to renew Oakland’s contract with JP Morgan Chase & Co., which provides municipal banking services to the city, citing the bank’s possible investments in the Dakota Access Pipeline, its failure to serve the city’s Black residents and its closure of a branch in an East Oakland district.

The contract with Chase costs the city $275,000 a year.

Councilmembers Larry Reid, Rebecca Kaplan and Desley Brooks voted not to extend the city’s contract with Chase, while Abel Guillén, Dan Kalb, Noel Gallo and Annie Campbell-Washington wanted to see the contract renewed.

Larry Reid

Councilmember Lynette Gibson McElhaney was absent during that portion of the city council meeting and did not vote.

“We need to have a discussion and dialogue about how (Chase) is going to do right with the African American community and with the city of Oakland,” said Reid on Tuesday night.

“I’m not voting for it tonight,” he said.

After the vote was made, a flustered city staff warned the council that since the contract expires March 17, the city soon would be without a bank and would not be able to pay its employees or carry out any of its day-to-day financial transactions.

Staff said it was working on putting together a Request for Proposals (RFP) process to find a new bank, but that it would be a nine-month process starting in July.

Kaplan ultimately agreed to a revote and Oakland’s contract with Chase was renewed until 2018.

Meanwhile, Kaplan and Gallo are working with city staff to improve upon a linked banking ordinance that would reshape the city’s banking contracting process so that they city could refuse to work with banks that are invested in the Dakota Access Pipeline or have other business practices or investments that Oakland stands against.

This could also potentially include financial institutions tied to companies that will be involved in the construction and implementation of the Mexican border wall that the White House is backing.

This week, Councilmember Guillén introduced a resolution calling on the city to boycott any businesses complicit in the construction of the wall.

Guillén did not respond to questions about whether Chase would be on the boycott list if it is found to be financially tied to those companies.

A large group of community members protesting Oakland’s financial ties to major banks marched to City Hall just hours before the vote took place and held a demonstration to highlight the toxic connections between big banks and the environment.

Another reason council members chose to move away from contracting with Chase was to solidify the need for Oakland to establish a public bank, a concept that has been growing in support among council members and the community.

“It would be the city’s bank, and we would have control of it,” Susan Harman, an activist with Friends of the Public Bank of Oakland, told the Post.

“We won’t have to rely on the city to negotiate with Chase to do the right thing for minority- and women-owned businesses anymore but we can go to the bank board ourselves,” she said.

Other reasons that Harman cited for the city needing a public bank include avoiding a potential “cannabis crash” since most of Oakland’s cannabis industry deals in cash and isn’t able to bank due to federal regulations.

Having a Bank of Oakland would also help bolster the city if Donald Trump removes federal funding for sanctuary cities.

“The answer to all these issues is a public bank,” said Harman.


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