(KRON) — The San Francisco Board of Supervisors voted unanimously to create the first municipal bank in the nation. The approved proposal comes at a time when the city continues to recover economically following the COVID-19 pandemic.

The plans include a business and governance plan for creating a publicly-owned municipal financial corporation and then converting it into San Francisco’s first public bank.

Public banks are not new. There are about 900 institutions worldwide controlling tens of trillions in assets. This municipal bank, however, would be a first for the United States.

“As we continue to chart a path to economic recovery and a sustainable economy, the plans approved today provide a road map for our city to create the first municipal public bank in the country, a crucial strategy to ensure that our city funds are used to reverse inequities, not perpetuate them,” said Supervisor Dean Preston. “The approved plans are a huge step forward toward establishing a San Francisco Public Bank.” 

Traditional private banking has failed to offer sufficient access to financial services for residents and small businesses, most notably in communities of color, according to Supervisor Preston.

“Given the continuing failures of our banking industry, we are stepping up in innovative ways to provide a green and equitable alternative to big banks. Our investment in the public bank protects the future of our local economy and the financial interests of San Franciscans,” said Budget Committee and Local Agency Formation Commission Chair, Supervisor Connie Chan. “We will continue to build on this momentum until we get this done.” 

Following the unanimous votes, the city can now implement a municipal financial corporation or public bank in San Francisco.