REFERENCE TITLE: state-owned bank task force; study

State of Arizona House of Representatives Fifty-third Legislature Second Regular Session 2018

HB 2446

Introduced by Representatives Powers Hannley: Blanc, Cardenas, Descheenie, Espinoza, Fernandez, Friese, Gabaldón, Gonzales, Navarrete, Peten, Salman

 

AN ACT

 

establishing a state‑owned bank task force.

 

 

(TEXT OF BILL BEGINS ON NEXT PAGE)

 

Be it enacted by the Legislature of the State of Arizona:

Section 1.  State bank panel; nonpartisan state‑owned bank task force; members; duties; delayed repeal

A.  A state bank panel is established.  The panel consists of the following members:

1.  The governor or the governor's designee.

2.  One member of the senate who is appointed by the president of the senate and who is not of the same political party as the member appointed pursuant to paragraph 3 of this subsection.

3.  One member of the house of representatives who is appointed by the speaker of the house of representatives and who is not of the same political party as the member appointed pursuant to paragraph 2 of this subsection.

4.  The state treasurer or the state treasurer's designee.

5.  The chief executive officer of the Arizona commerce authority or the chief executive officer's designee.

B.  The state bank panel shall appoint all members of the nonpartisan state‑owned bank task force that is established by subsection C of this section.

C.  A nonpartisan state‑owned bank task force is established, consisting of members who represent the state government and key stakeholder groups or individuals who are involved in or interested in sustainable or economic development through public banking.  The task force consists of the following members who are appointed by the state bank panel established by subsection A of this section:

1.  One member of the senate and one member of the house of representatives who are not members of the same political party.

2.  The superintendent of financial institutions or the superintendent's designee.

3.  A representative from the Arizona commerce authority.

4.  A representative from the department of administration.

5.  The state treasurer or the state treasurer's designee.

6.  A representative from the department of revenue.

7.  A representative from a bank that has a permit that is issued pursuant to title 6, chapter 2, Arizona Revised Statutes.

8.  A representative from a public bank advocacy organization.

9.  A representative from an economic research department of a university under the jurisdiction of the Arizona board of regents.

10.  A person who owns a business with fewer than two hundred employees that is located in a rural area in this state.

11.  A person who owns a business with fewer than two hundred employees that is located in an urban area of this state.

12.  A person who is a mayor of a town that is located in a rural area of this state.

13.  A person who is a mayor of a city or town that has a population of more than two hundred fifty thousand persons.

D.  The state treasurer or the state treasurer's designee shall serve as the chairperson of the task force.

E.  Task force members serve without compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2, Arizona Revised Statutes.

F.  The task force shall explore and evaluate the feasibility of establishing a state-owned bank.  The task force shall review and evaluate the following:

1.  The Bank of North Dakota, including its enabling statutes, governing structure, financial performance and programs.

2.  The findings from studies or pilot projects conducted by other states and cities including those conducted by Massachusetts, New Jersey, Santa Fe and Philadelphia and Tucson's community banking project.

3.  White papers and reports produced by independent research groups.

4.  The effectiveness of this state's current economic development strategies based on tax abatement and other incentives.

5.  The long‑term broad economic impact that having a state‑owned bank could have on education, innovation, small business development, student loan affordability, economic diversification, state revenue, job creation, the health of community banks, the availability of affordable credit and the overall financial health and stability of this state.

6.  Any effects a state-owned bank will have on existing banks and financial institutions in this state.

7.  Reciprocal relationships that the public bank will have with community banks and other financial institutions.

8.  Steps required in establishing a public bank.

9.  The capital requirements of a state-owned bank.

10.  Initial capitalization options for a state-owned bank.

11.  The cash management and banking needs of this state.

12.  An estimate of the short-term operating costs and projected revenues of a state-owned bank.

13.  The structure of the bank and its board.

14.  Potential revenue‑generating loan programs such as small business loans and student loans.

15.  Potential uses for revenue generated by the public bank's low‑interest loan program, such as public education, transportation‑related infrastructure and stabilization of pension monies.

16.  The laws, statutes and rules applicable to establishing a state‑owned bank, including the possibility of amending the Constitution of Arizona to make a state‑owned bank in this state viable.

G.  The task force may:

1.  Establish investigative subgroups.

2.  Invite experts in relevant fields, including banking, finance, economics and community development, to provide information and assistance to the task force.

H.  The task force shall submit a report of its findings and recommendations to the governor, the president of the senate and the speaker of the house of representatives on or before December 1, 2018 and shall provide a copy of this report to the secretary of state.

I.  This section is repealed from and after September 30, 2019.