US Conference of Mayors to Consider Wall Street Bank Fees & Public Banking
by Pamela Powers Hannley
Posted June 29, 2015
At their meeting on June 19-22, the US Conference of Mayors will be considering hundreds of resolutions on everything from gun safety to tax incentives to jobs and education. Tucked into that long list of resolutions is the “Mayors Resolution on Strengthening Municipal Finances”.
This resolution addresses the millions of dollars in fees that Wall Street banks charge cities and challenges mayors to negotiate with bankers to reduce these fees or, alternatively, seek other more affordable means of financing– like establishment of a public bank.
How do cities amass such high banking service fees? A major way that cities accrue debt (and related fees and interest) is through bond issues. For example, in recent years voters approved a city bond issue to fix the roads and a county bond issue to build a new animal shelter. On Election Day 2015, voters will be asked to approve yet another bond issue— this one covering everything but the kitchen sink. Listen up, people! Bond issues are not a panacea for all local funding needs. Yes, bond issues allow us to have the services, facilities, and infrastructure improvements we need but can’t fit into the budget– thanks to budget cuts by the Legislature– but bond issues carry a hefty long-term price tag. More…