Measure Z: Measure Z - City Of Berkeley - Initiative - Public Bank Measure

In plain language

Measure Z would create a new tax in Berkeley to help start a public bank. A YES vote sets up a tax on buildings. Homes would pay 6 cents per square foot. Other buildings would pay 9 cents per square foot. The money would fund a public bank. That bank would invest in affordable housing, green energy, infrastructure, and small businesses. The City Council would review and approve the bank's funds. The bank would be audited regularly. The tax would last six years. It is expected to raise about $9,200,000 in its first year. Over six years it would raise about $58,300,000 total. A NO vote means this tax and public bank would not be created.

Fiscal impact

The tax rates are $0.06 per square foot of residential building improvements and $0.09 per square foot of non-residential building improvements, expected to raise about $9,200,000 in the first year and about $58,300,000 over its six-year duration.

Impartial analysis

This measure was placed on the ballot by an initiative petition signed by the requisite number of registered voters in the City of Berkeley. It requires a majority vote for passage. This measure would levy a special parcel tax to fund a public bank, defined as a nonprofit corporation organized under California law to engage in commercial or industrial banking business, that is wholly owned by one or more local agencies, or a joint powers authority of local agencies. California law authorizes a local agency to create a public bank subject to the conduct of a feasibility study, approval by the California Department of Financial Protection and Innovation, and a statewide cap of two per year and a total of no more than 10 public banks in California. If adopted, the tax would be imposed starting January 1, 2027, at a rate of $0.06 per square foot of improvements for all residential property and $0.09 per square foot of improvements for all non-residential property. The City estimates the tax would raise approximately $9,200,000 in the first year, and $58,300,000 over its six-year duration. Proceeds from the tax would be placed into a special fund to capitalize and support a public bank to fund long-term investments in affordable housing, green energy/infrastructure and small businesses. “Affordable housing” means housing below 120% of Area Median Income. “Green energy/infrastructure” means improvements to property, buildings and structures to further carbon and fossil fuel reduction, including energy savings, community resilience, zero-carbon energy generation, electrified transportation and industry, sustainable materials management, and waste reduction. “Small businesses” means businesses, especially those run by minorities, women, and people of color, which meet any of the following: 1. Are growing businesses too small to receive adequate traditional bank support, or are expected to grow with loan support unavailable from traditional banks; 2. Need early-stage start-up support; 3. Have longer-term receivables and shorter-term payables; or 4. Are funds specializing in employee ownership transitions. Returns earned from the special fund would be reinvested into the fund. If a public bank cannot secure authorization to conduct business by June 30, 2033, the special fund could be used to offer loans to support affordable housing, green energy/infrastructure, and small businesses until authorization is secured. During that time, tax proceeds could be used for City staff costs for performing work related to such loans. All funds would be subject to review, allocation and approval by the City Council. The City Council would annually increase the tax rate based on inflation. The City Manager would submit to the City Council an annual report of funds collected and expended, and performance metrics, outcomes and accomplishments reflecting the public bank’s progress. At least every three years, the City Auditor would audit all expenditures and the progress made toward achieving the parcel tax’s purposes to confirm that expenditures and reports are accurate and consistent with the intent of the ordinance. /s/ Farimah Faiz Brown Berkeley City Attorney

Official ballot arguments

Filed for the official voter guide by each side, printed as submitted.

The official arguments will appear here once both sides’ arguments are on file.