I 

116TH CONGRESS 

2D SESSION H. R. 8721 

To provide for the Federal charter of certain public banks, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

OCTOBER 30, 2020 

Ms. TLAIB (for herself, Ms. OCASIO-CORTEZ, Ms. PRESSLEY, Ms. JAYAPAL, 

Ms. OMAR, Mr. GREEN of Texas, Mr. THOMPSON of Mississippi, Mr. 

BLUMENAUER, Ms. LEE of California, and Ms. SCHAKOWSKY) introduced 

the following bill; which was referred to the Committee on Financial Services, and in addition to the Committee on Oversight and Reform, for a 

period to be subsequently determined by the Speaker, in each case for 

consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To provide for the Federal charter of certain public banks, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Public Banking Act of 2020’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 


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Sec. 1. Short title; table of contents. 

Sec. 2. Definitions. 

TITLE I—FEDERAL RECOGNITION OF PUBLIC BANKS 

Sec. 101. Federal charter of public lending banks and public payment banks. 

Sec. 102. Federal recognition of non-federally chartered banks. 

Sec. 103. Federal Reserve System membership. 

Sec. 104. Public member bank services. 

Sec. 105. Specific requirements relating to covered banks. 

Sec. 106. Regulations. 

Sec. 107. Technical assistance. 

TITLE II—FEDERAL RECOGNITION OF PUBLIC SECURITIES 

Sec. 201. Regulation of public lending banks and non-federally chartered banks. 

TITLE III—PUBLIC DEPOSIT INSURANCE 

Sec. 301. In general. 

TITLE IV—POSTAL BANKING 

Sec. 401. Partnerships with covered banks for postal banking services. 

TITLE V—PUBLIC BANK DEVELOPMENT PROGRAMS 

Sec. 501. Public bank grant program. 

Sec. 502. Public bank incubator program. 

Sec. 503. Community development grant program. 

Sec. 504. Treatment of funding. 

1 SEC. 2. DEFINITIONS. 

2 In this Act: 

3 (1) BOARD OF GOVERNORS.—The term ‘‘Board 

4 of Governors’’ means the Board of Governors of the 

5 Federal Reserve System. 

6 (2) COMMISSION.—The term ‘‘Commission’’ 

7 means the Securities and Exchange Commission. 

8 (3) CORPORATION.—The term ‘‘Corporation’’ 

9 means the Federal Deposit Insurance Corporation. 

10 (4) COVERED BANK.—The term ‘‘covered bank’’ 

11 means— 


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1 (A) a public lending bank (as defined in 

2 section 101(b)); 

3 (B) a public payment bank (as defined in 

4 section 101(c)); and 

5 (C) a non-federally chartered bank (as de6 fined in section 102(b)) that obtains a certifi7 cate of Federal recognition under section 102. 

8 (5) PUBLIC MEMBER BANK.—The term ‘‘public 

9 member bank’’ means a covered bank that is a mem10 ber of the Federal Reserve System. 

11 (6) SECRETARY.—The term ‘‘Secretary’’ means 

12 the Secretary of the Treasury. 

13 (7) STATE.—The term ‘‘State’’ means each of 

14 the several States, the District of Columbia, and any 

15 commonwealth, territory, or possession of the United 

16 States. 

17 TITLE I—FEDERAL RECOGNI18 TION OF PUBLIC BANKS 

19 SEC. 101. FEDERAL CHARTER OF PUBLIC LENDING BANKS 

20 AND PUBLIC PAYMENT BANKS. 

21 (a) IN GENERAL.—The Board of Governors shall 

22 charter public lending banks and public payment banks. 

23 (b) PUBLIC LENDING BANK DEFINED.—The term 

24 ‘‘public lending bank’’ means a person that— 

25 (1) is wholly owned and controlled by— 


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1 (A) a State or Tribal government, includ2 ing a unit of local government, government 

3 agency; 

4 (B) a State or Tribally chartered corpora5 tion; 

6 (C) a nonprofit instrumentality designated 

7 by a State or Tribal government as acting in 

8 the public interest of a community within such 

9 State or Tribe, including an unincorporated 

10 community; or 

11 (D) an association of 1 or more entities de12 scribed in subparagraphs (A) through (C); 

13 (2) that— 

14 (A) is not owned or governed by, operated 

15 as a subsidiary of, or otherwise affiliated with 

16 any for-profit entity; 

17 (B) does not own, govern, or operate as a 

18 subsidiary of any for-profit entity; and 

19 (C) does not compensate any employee, ex20 ecutive, or board member at a rate to exceed 

21 the salary of the President of the United States 

22 for that equivalent period; and 

23 (3) provides— 

24 (A) fiscal agent services; 

25 (B) money transmitter services; 


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1 (C) digital dollar services as a pass2 through intermediary for the Federal Govern3 ment; 

4 (D) depository services; 

5 (E) postal banking services; 

6 (F) securities-related services; or 

7 (G) any lending product approved by the 

8 Board of Governors. 

9 (c) PUBLIC PAYMENT BANK DEFINED.—The term 

10 ‘‘public payment bank’’ means a person that— 

11 (1) is wholly owned and controlled by an entity 

12 described in subsection (b)(1); 

13 (2) provides at least one of the services speci14 fied in subparagraphs (A) through (E) of subsection 

15 (b)(2); and 

16 (3) does not provide the services specified in 

17 subparagraph (F) or (G) of subsection (b)(2). 

18 (d) EXCEPTION OF CERTAIN PUBLIC LENDING

19 BANKS FROM CONSIDERATION AS BANK HOLDING COM20 PANY.—A person described in subsection (b) shall not be 

21 considered a bank holding company under the Bank Hold22 ing Company Act of 1956 (12 U.S.C. 1841 et seq.) or 

23 any other law, solely due to the person’s ownership or con24 trol of a public lending bank, public payment bank, or non25 federally chartered bank. 


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1 (e) GUIDANCE WITH RESPECT TO EXCLUDED AND

2 MARGINALIZED GROUPS.—The Board of Governors shall 

3 issue guidance to public lending banks and public payment 

4 banks to ensure that the services provided by such banks 

5 are universal and comprehensively include historically ex6 cluded and marginalized groups. 

7 SEC. 102. FEDERAL RECOGNITION OF NON-FEDERALLY 

8 CHARTERED BANKS. 

9 (a) CERTIFICATES OF RECOGNITION.—The Board of 

10 Governors shall issue certificates of Federal recognition to 

11 non-federally chartered banks. 

12 (b) NON-FEDERALLY CHARTERED BANK DE13 FINED.—The term ‘‘non-federally chartered bank’’ means 

14 a person that is— 

15 (1) wholly owned and controlled by an entity 

16 described in section 101(b)(1); and 

17 (2) either— 

18 (A) chartered as a non-depository institu19 tion by an approved non-Federal financial regu20 lator described in subsection (c); or 

21 (B) insured as a depository institution by 

22 the Corporation, or under an alternate public 

23 deposit insurance scheme approved by the Cor24 poration. 


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1 (c) LIST OF APPROVED NON-FEDERAL FINANCIAL

2 REGULATORS.—The Board of Governors shall establish 

3 and maintain on a public website of the Board of Gov4 ernors a list of approved non-Federal financial regulators 

5 for the purpose of determining eligibility for a certificate 

6 of Federal recognition under this section. 

7 (d) CONVERSION.—At the request of a non-federally 

8 chartered bank, the Board of Governors may convert such 

9 bank into a public payment bank or a public lending bank. 

10 (e) SERVICES.—A non-federally chartered bank— 

11 (1) may not offer depository services before— 

12 (A) obtaining— 

13 (i) deposit insurance or conditional 

14 deposit insurance from the Corporation; or 

15 (ii) deposit insurance from alternate 

16 public deposit insurance scheme approved 

17 by the Corporation; and 

18 (B) becoming a public member bank or a 

19 conditional public member in accordance with 

20 section 103(b); and 

21 (2) may— 

22 (A) invest any funds held on behalf of an 

23 entity described in section 101(b)(1) in a fiscal 

24 agent account; 


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1 (B) provide fiscal agent services, including 

2 sending and receiving money and effectuating 

3 payments to and from any entity whose funds 

4 are invested in a fiscal agent account; 

5 (C) invest any funds held on behalf of an 

6 entity not described in section 101(b)(1) in a 

7 payments account or as digital dollar products; 

8 and 

9 (D) provide money transmitter and digital 

10 dollar services. 

11 (f) GUIDANCE WITH RESPECT TO EXCLUDED AND

12 MARGINALIZED GROUPS.—Not later than 1 year after the 

13 date of the enactment of this Act, the Board of Governors 

14 shall issue guidance to non-federally chartered banks to 

15 ensure that the services provided by such banks are uni16 versal and comprehensively include historically excluded 

17 and marginalized groups. 

18 SEC. 103. FEDERAL RESERVE SYSTEM MEMBERSHIP. 

19 (a) ELIGIBILITY.—A covered bank shall be eligible 

20 for membership in the Federal Reserve System as a public 

21 member bank and, except as provided in subsection (c), 

22 shall be treated in the same manner as a member bank 

23 under section 4 of the Federal Reserve Act (12 U.S.C. 

24 308). 


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1 (b) CONDITIONAL PUBLIC MEMBER BANK.—The 

2 Board of Governors shall establish a special category of 

3 public member bank, called a ‘‘conditional public member 

4 bank’’, for persons that are in the process of applying for 

5 becoming a covered bank. Such conditional public member 

6 banks shall be subject to such conditions and restrictions 

7 as the Board of Governors determines to be necessary and 

8 appropriate to promote public welfare, provided that such 

9 conditions and restrictions are not arbitrary, punitive, or 

10 unduly burdensome. 

11 (c) PURCHASING STOCK.—The Board of Governors 

12 may not require a covered bank to purchase stock in a 

13 Federal Reserve Bank or otherwise maintain paid-in cap14 ital in the Federal Reserve System. 

15 SEC. 104. PUBLIC MEMBER BANK SERVICES. 

16 (a) PURPOSES OF SERVICES.—The Board of Gov17 ernors shall offer the services described in subsection (b) 

18 to public member banks in order to— 

19 (1) promote the safety, soundness, viability, and 

20 resiliency of publicly owned and operated financial 

21 institutions; 

22 (2) facilitate the provision of payments, credit, 

23 and other financial services as a public good; and 

24 (3) support the financial and budgetary health 

25 of State and Tribal governments, local government 


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1 units, government agencies, State or tribally char2 tered corporations, nonprofit entities designated by a 

3 State or Tribal government to be acting in the pub4 lic interest of a community within such State or 

5 Tribe, or an association of one or more of such enti6 ties. 

7 (b) SERVICES.—The Board of Governors shall offer 

8 the following services to public member banks: 

9 (1) Fiscal agent accounts— 

10 (A) in which public member banks may in11 vest funds held on behalf of any entity de12 scribed in section 101(b)(1); and 

13 (B) under which— 

14 (i) the Board of Governors shall pay 

15 interest on all balances held overnight in 

16 such fiscal agent accounts at a rate that is 

17 greater than or equal to the greater of— 

18 (I) the sum of the overnight pol19 icy target rate plus two percent; or 

20 (II) the daily rate on 30-year 

21 marketable Treasury bonds; and 

22 (ii) the interest described in clause (i) 

23 (minus a reasonable administrative fee im24 posed by the public member bank) shall be 


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1 paid to the entity for which the public 

2 member bank invested such funds. 

3 (2) Payment accounts— 

4 (A) in which public member banks may in5 vest funds held on behalf of any entity other 

6 than an entity described in section 101(b)(1) 

7 for purposes of providing money transmitter 

8 services; and 

9 (B) under which the Board of Governors 

10 shall pay interest (minus a reasonable adminis11 trative fee) on all balances held overnight in 

12 such fiscal agent accounts at a rate that is 

13 greater than or equal to the greater of the fol14 lowing: 

15 (i) The overnight rate paid on re16 quired reserves. 

17 (ii) The overnight night paid on ex18 cess reserves. 

19 (3)(A) Digital dollar services in which public 

20 member banks may operate as pass-through inter21 mediaries for any digital dollar or other financial 

22 services offered by the Federal Government, includ23 ing— 


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1 (i) digital dollar account wallets ad2 ministered by the Board of Governors 

3 (commonly known as ‘‘FedAccounts’’); 

4 (ii) digital dollar cash wallets adminis5 tered by the Secretary (commonly known 

6 as ‘‘eCash’’); and 

7 (iii) postal banking services provided 

8 by the United States Postal Service. 

9 (B) The Board of Governors may issue regula10 tions as necessary to ensure effective harmonization 

11 and coordination between covered banks and any en12 tities responsible for administering digital dollar 

13 services on behalf of the Federal Government. 

14 (4)(A) A facility (to be known as the ‘‘Public 

15 Bank Primary Liquidity Facility’’) to provide liquid16 ity to public member banks by buying or lending (at 

17 a reasonable rate of interest that is not greater than 

18 the overnight policy target rate) against federally 

19 recognized public loans (as described in section 105) 

20 and federally-recognized public securities (as de21 scribed in section 201(b)), under terms and condi22 tions that the Board of Governors determines to be 

23 necessary and appropriate to promote public welfare. 


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1 (B) The facility under subparagraph (A) shall 

2 purchase or accept loans or securities under such 

3 subparagraph at face value. 

4 (5)(A) A facility (to be known as the ‘‘Public 

5 Bank Supplementary Liquidity Facility’’) to provide 

6 liquidity to public member banks by buying or lend7 ing (at a reasonable rate of interest that is not 

8 greater than the overnight policy target rate) 

9 against assets not otherwise eligible to be purchased 

10 or accepted as collateral under paragraph (4). 

11 (B) The facility under subparagraph (A) may 

12 purchase or accept assets as collateral under such 

13 subparagraph at a reasonable discount. 

14 (6) A facility (to be known as the ‘‘Public Bank 

15 Credit Facility’’) to provide credit to public member 

16 banks on an unsecured basis, in such amounts and 

17 such rates of interests as the Board of Governors 

18 determines to be necessary and appropriate to pro19 mote public welfare. 

20 (7) A facility (to be known as the ‘‘Federally 

21 Recognized Public Loan Facility’’) to, in consulta22 tion with the Corporation— 

23 (A) develop rules, standards, and criteria 

24 for Federal recognition of loans, mortgages, 

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1 rect lending products issued by public member 

2 banks; and 

3 (B) provide prepurchase agreements under 

4 which the facility will purchase loans and agree 

5 that such loans will be repurchased by the pub6 lic member bank at such time as is agreed upon 

7 by such facility and member bank. 

8 (c) ADMINISTRATIVE, OPERATING, AND MAINTE9 NANCE COSTS.—The Board of Governors shall pay all ad10 ministrative, operating, and maintenance costs associated 

11 with the accounts, services, and facilities described in sub12 section (b). 

13 (d) REIMBURSEMENT.—The Board of Governors 

14 shall reimburse a public member bank for any expenses 

15 reasonably incurred in the process of operating as a pass16 through intermediary described in subsection (b)(3). 

17 (e) EXPENSES.— 

18 (1) MEMBER SERVICES.—Any expenses in19 curred by the Board of Governors under paragraphs 

20 (1) through (3) of subsection (b) and under sub21 sections (c) and (d) shall be recorded— 

22 (A) in an account to be known as the 

23 ‘‘Special Public Member Bank Services Ac24 count’’ established at the Federal Reserve Bank 

25 of New York; and 


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1 (B) as a deferred asset (as described in 

2 section 11.96 of the Financial Accounting Man3 ual for Federal Reserve Banks, as in effect on 

4 the date of the enactment of this Act) and 

5 maintained separately from the balance sheet of 

6 the Federal Reserve Bank of New York and the 

7 Federal Reserve System, so as to not reduce or 

8 impact the calculation of total income or rev9 enue generated by the Federal Reserve System, 

10 or otherwise reduce the total amount of net op11 erating profits to be made available for remit12 tance to the Treasury on an ongoing basis. 

13 (2) FACILITIES.—Any expenses incurred by the 

14 Board of Governors under paragraphs (4) through 

15 (7) of subsection (b) shall be recorded— 

16 (A) in an account to be known as the 

17 ‘‘Special Public Member Bank Liquidity and 

18 Credit Account’’ established at the Federal Re19 serve Bank of New York; and 

20 (B) as a deferred asset (as described in 

21 section 11.96 of the Financial Accounting Man22 ual for Federal Reserve Banks, as in effect on 

23 the date of the enactment of this Act) and 

24 maintained separately from the balance sheet of 

25 the Federal Reserve Bank of New York and the 


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1 Federal Reserve System, so as to not reduce or 

2 impact the calculation of total income or rev3 enue generated by the Federal Reserve System, 

4 or otherwise reduce the total amount of net op5 erating profits to be made available for remit6 tance to the Treasury on an ongoing basis. 

7 SEC. 105. SPECIFIC REQUIREMENTS RELATING TO COV8 ERED BANKS. 

9 (a) TERMS OF RETAIL ACCOUNT SERVICES.—Any 

10 covered bank that holds, administers, or manages funds 

11 on behalf of any unincorporated person in a payments ac12 count, or otherwise accepts funds on deposit or for the 

13 purpose of providing public depository accounts services— 

14 (1) may not— 

15 (A) impose any fees, minimum balances, or 

16 maximum balances on such payments accounts 

17 or public depository accounts; or 

18 (B) include on such payments accounts or 

19 public depository accounts; 

20 (2) shall— 

21 (A) prominently brand any such payments 

22 account or public depository account as a ‘‘pub23 lic bank account’’ in all account statements, 

24 marketing materials, and other communications 

25 of the public bank; and 


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1 (B) provide such account holders with rea2 sonable protection against losses caused by 

3 fraud or security breaches, as determined by 

4 the Corporation or the Director of the Bureau 

5 of Consumer Financial Protection, or both; and 

6 (3) may only close or restrict access to such 

7 payments accounts or public depository accounts on 

8 the basis of the mandate of the covered bank. 

9 (b) TERMS OF RETAIL CREDIT.— 

10 (1) IN GENERAL.—Notwithstanding any provi11 sion of law, the annual percentage rate applicable to 

12 any extension of credit by a covered bank may not 

13 exceed the lesser of— 

14 (A) 15 percent on unpaid balances, inclu15 sive of all finance charges; or 

16 (B) the maximum rate permitted by the 

17 laws of the State in which the consumer resides. 

18 (2) OTHER FEES.—Any fees that are not con19 sidered finance charges under paragraph (1), includ20 ing fees for ancillary products and services, may 

21 not— 

22 (A) exceed the total amount of finance 

23 charges assessed; and 

24 (B) be imposed in such a way as to evade 

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1 terest and related costs that may be charged in 

2 relation to any lending product issued by cov3 ered banks under this Act. 

4 (3) PENALTIES FOR CHARGING HIGHER RATES

5 ON RETAIL CREDIT.— 

6 (A) VIOLATION.—The taking, receiving, re7 serving, or charging of an annual percentage 

8 rate or fee greater than that permitted by para9 graph (1), when knowingly done, shall be a vio10 lation of this subsection, and a forfeiture of the 

11 entire interest which the note, bill, or other evi12 dence of the obligation carries with it, or which 

13 has been agreed to be paid thereon. 

14 (B) REFUND OF INTEREST AMOUNTS.— 

15 (i) IN GENERAL.—With respect to a 

16 person charging interest, a finance charge, 

17 or a fee greater than that permitted by 

18 paragraph (1), the person paying such in19 terest, finance charge, or fee may notify 

20 the Bureau of Consumer Financial Protec21 tion, and the Bureau of Consumer Finan22 cial Protection shall take such enforcement 

23 actions as the Director of the Bureau of 

24 Consumer Financial Protection determines 

25 appropriate. 


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1 (ii) LACK OF BUREAU ACTION.—If a 

2 person notifies the Bureau of Consumer 

3 Financial Protection under clause (i), and 

4 the Bureau of Consumer Financial Protec5 tion takes no action with respect to such 

6 notice during the 60-day period following 

7 such notice, such person may bring an ac8 tion in a Federal district court to recover 

9 the entire amount of interest, finance 

10 charges, or fees paid. 

11 (C) CIVIL LIABILITY.—Any creditor who 

12 violates this subsection shall be subject to the 

13 provisions of section 130(a) of the Truth in 

14 Lending Act (15 U.S.C. 1640(a)). 

15 (D) BANK SECRECY ACT.—In establishing 

16 and maintaining personal accounts, each cov17 ered bank shall comply with— 

18 (i) section 21 of the Federal Deposit 

19 Insurance Act (12 U.S.C. 1829b); 

20 (ii) section 123 of Public Law 91– 

21 508; and 

22 (iii) subchapter II of chapter 53 of 

23 title 31, United States Code. 

24 (c) ANNUAL REPORTING REQUIREMENTS.—Each 

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1 port on the activities of such covered bank, including re2 cipients of financial services, sources of funding, financial 

3 reporting, and evaluation of the effectiveness of the cov4 ered bank’s services in achieving the public purposes for 

5 which it was chartered, as well as any other purposes, 

6 goals, and targets under this Act or other law or regula7 tion. 

8 SEC. 106. REGULATIONS. 

9 (a) IN GENERAL.—Not later than 1 year after the 

10 date of the enactment of this Act, the Board of Governors, 

11 the Director of the Bureau of Consumer Financial Protec12 tion, and the Corporation shall jointly— 

13 (1) establish a separate regulatory scheme with 

14 respect to public lending banks, public payment 

15 banks, and non-federally chartered banks that re16 ceive or are in the process of receiving a certificate 

17 of Federal recognition under section 102; and 

18 (2) after a notice and comment period during 

19 which consumer advocacy organizations shall be in20 vited to submit feedback and suggestions, and issue 

21 such regulations as are necessary and appropriate to 

22 promote public welfare with respect to public lending 

23 banks, public payment banks, and non-federally 

24 chartered banks that receive or are in the process of 


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1 receiving a certificate of Federal recognition under 

2 section 102. 

3 (b) REGULATIONS WITH RESPECT TO EXCLUDED

4 AND MARGINALIZED GROUPS.— 

5 (1) IN GENERAL.—Not later than 1 year after 

6 the date of the enactment of this Act, the Board of 

7 Governors shall issue regulations for public lending 

8 banks and public payment banks to ensure that the 

9 services provided by such banks are universal and 

10 comprehensively include historically excluded and 

11 marginalized groups. 

12 (2) LIMITATIONS.—A regulation issued under 

13 this subsection may not— 

14 (A) supersede or supplant any other 

15 stronger regulations or standards promulgated 

16 by other Federal or applicable State regulatory 

17 entities, including any such regulation issued by 

18 the Corporation or the Director of the Bureau 

19 of Consumer Financial Protection; and 

20 (B) result in less robust or less stringent 

21 protections to consumers than protections that 

22 exist on the date of the enactment of this Act 

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1 tection under the Community Reinvestment Act 

2 of 1977 (12 U.S.C. 2901 et seq.). 

3 (3) DATA REPORTING.—The Board of Gov4 ernors and the Corporation shall jointly, in a man5 ner that respects the privacy of covered bank cus6 tomers to the greatest extent possible, develop an 

7 annual assessment for determining if covered banks 

8 have appropriately provided services to all customers 

9 within the jurisdiction of service, based on demo10 graphic information chosen by regulators, including 

11 race, gender, and area median income of such cus12 tomers. 

13 (c) ECOLOGICAL SUSTAINABILITY CONSIDERATIONS

14 AND PROHIBITIONS ON FOSSIL FUEL INVESTMENT.— 

15 (1) IN GENERAL.—The Board of Governors, the 

16 Corporation, and the Commission shall jointly de17 velop and promulgate rules and regulations to— 

18 (A) ensure that any and all activities un19 dertaken and services offered by a covered 

20 bank, or any person seeking or in the process 

21 of becoming a covered bank, are consistent with 

22 Federal and scientifically established standards, 

23 goals, and targets with respect to ecological sus24 tainability, climate crisis-mitigation, and 

25 decarbonization; and 


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1 (B) require that any covered bank or per2 son seeking or in the process of becoming a cov3 ered bank, may not facilitate fossil fuel produc4 tion or infrastructure, including by— 

5 (i) providing loans to, making invest6 ments in, or otherwise engaging in any ac7 tivity that is financial in nature, or inci8 dental to such financial activity, with a fos9 sil fuel company; 

10 (ii) providing loans to, making invest11 ments in, or otherwise engaging in any ac12 tivity that is financial in nature, or inci13 dental to such financial activity, for a fossil 

14 fuel project; 

15 (iii) taking compensation to arrange 

16 or facilitate a transaction that provides 

17 funds for fossil fuel production from new 

18 sources; 

19 (iv) securitizing assets that provide 

20 funds for fossil fuel production from new 

21 sources; 

22 (v) entering into a derivatives trans23 action designed to provide funding for, fa24 cilitate, or hedge risks from fossil fuel pro25 duction from new sources; and 


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1 (vi) engaging in any activity that is 

2 complementary to a financial activity in3 volving fossil fuel production from new 

4 sources, including financing the inter5 national trade thereof; or any other form 

6 of activity defined by regulators or super7 visors of the covered bank. 

8 (2) DEFINITIONS.—In this subsection: 

9 (A) FOSSIL FUEL.—The term ‘‘fossil fuel’’ 

10 means coal, petroleum, natural gas, or any de11 rivative of coal, petroleum, or natural gas that 

12 is used for fuel. 

13 (B) FOSSIL INFRASTRUCTURE.—The term 

14 ‘‘fossil infrastructure’’ means fossil fuel-related 

15 projects, including wells, rail infrastructure, 

16 pipelines, terminals, refineries, and power 

17 plants. 

18 (C) NEW SOURCES.—The term ‘‘new 

19 sources’’ means— 

20 (i) any production in excess of proven 

21 developed producing reserves of fossil fuels 

22 as of the date of enactment of this section; 

23 or 


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1 (ii) new or expanded fossil infrastruc2 ture that would facilitate the production 

3 described in subparagraph (A). 

4 (D) PRODUCTION.—The term ‘‘produc5 tion’’ means extractive or production activities 

6 that result in fossil fuels being made available 

7 for refining or use. 

8 (d) STATE LAW.—Nothing in this section may be 

9 construed to preempt any provision of State law that pro10 vides greater protection to consumers, or establishes more 

11 stringent environmental or ecological regulations, than is 

12 provided in this section. 

13 SEC. 107. TECHNICAL ASSISTANCE. 

14 The Board of Governors shall provide technical as15 sistance to public member banks to develop, use, and share 

16 financial and infrastructure technologies, practices, and 

17 operational and business practice data that promote the 

18 public welfare, however such data may not include any 

19 customer data, including transactional and identifying in20 formation. 


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1 TITLE II—FEDERAL RECOGNI2 TION OF PUBLIC SECURITIES 

3 SEC. 201. REGULATION OF PUBLIC LENDING BANKS AND 

4 NON-FEDERALLY CHARTERED BANKS. 

5 (a) IN GENERAL.—The Commission shall establish a 

6 separate registration and regulatory scheme for licensing 

7 and regulating as public investment entities all public 

8 lending banks and non-federally chartered banks that en9 gage or seek to engage in securities-related activities, in10 cluding origination, investment brokering, dealing, and 

11 trading of federally-recognized public securities. 

12 (b) FEDERALLY-RECOGNIZED PUBLIC SECURI13 TIES.—The Board of Governors shall, in consultation with 

14 the Commission, develop rules, standards, and criteria for 

15 Federal recognition of securities issued by public member 

16 banks (to be known as ‘‘federally-recognized public securi17 ties’’) as the Commission determines to be necessary and 

18 appropriate to promote public welfare. 

19 (c) CONDITIONAL LICENSE.—The Commission shall 

20 establish a special category of public investment entity li21 cense for entities that are in the process of applying for, 

22 but have not yet received, any license to issue federally23 recognized public securities, which shall be subject to such 

24 conditions and restrictions as the Commission determines 

25 to be necessary and appropriate to promote public welfare. 


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1 TITLE III—PUBLIC DEPOSIT 

2 INSURANCE 

3 SEC. 301. IN GENERAL. 

4 (a) PUBLIC DEPOSIT INSURANCE.—The Corporation 

5 shall establish a separate registration and regulatory 

6 scheme for providing deposit insurance (to be known as 

7 ‘‘public deposit insurance’’) to covered banks and make 

8 such deposit insurance available to covered banks without 

9 regard to the total deposit amount. 

10 (b) CONDITIONAL INSURANCE.—The Corporation 

11 shall establish a separate registration and regulatory 

12 scheme for providing deposit insurance (to be known as 

13 ‘‘conditional public deposit insurance’’) for entities that 

14 are in the process of applying for, but have not yet re15 ceived, public deposit insurance, which shall be subject to 

16 such conditions and restrictions as the Corporation deter17 mines to be necessary and appropriate to promote public 

18 welfare. 

19 TITLE IV—POSTAL BANKING 

20 SEC. 401. PARTNERSHIPS WITH COVERED BANKS FOR 

21 POSTAL BANKING SERVICES. 

22 (a) PARTNERSHIP WITH USPS.—Notwithstanding 

23 section 404(e)(2) of title 36, United States Code, the 

24 Postmaster General shall, to the maximum extent prac25 ticable, partner with covered banks to make available reVerDate Sep 11 2014 02:07 Nov 24, 2020 Jkt 019200 PO 00000 Frm 00027 Fmt 6652 Sfmt 6201 E:\BILLS\H8721.IH H8721

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1 tail account and payment services provided by covered 

2 banks at post offices, and via any postal banking plat3 forms established by the United States Postal Service. 

4 (b) FUNDING.—The Board of Governors shall provide 

5 such funding to the United States Postal Service as the 

6 Postmaster General determines to be necessary to achieve 

7 carry out subsection (a). 

8 (c) TREATMENT OF EXPENSES.—Any expenses in9 curred by the Board of Governors under this section shall 

10 be recorded— 

11 (1) in an account to be known as the ‘‘Special 

12 Public Member Bank Services Account’’ established 

13 at the Federal Reserve Bank of New York; and 

14 (2) as a deferred asset (as described in section 

15 11.96 of the Financial Accounting Manual for Fed16 eral Reserve Banks, as in effect on the date of the 

17 enactment of this Act) and maintained separately 

18 from the balance sheet of the Federal Reserve Bank 

19 of New York and the Federal Reserve System, so as 

20 to not reduce or impact the calculation of total in21 come or revenue generated by the Federal Reserve 

22 System, or otherwise reduce the total amount of net 

23 operating profits to be made available for remittance 

24 to the Treasury on an ongoing basis. 


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1 TITLE V—PUBLIC BANK 

2 DEVELOPMENT PROGRAMS 

3 SEC. 501. PUBLIC BANK GRANT PROGRAM. 

4 (a) PROGRAM ESTABLISHED.— 

5 (1) IN GENERAL.—The Board of Governors 

6 shall, jointly with the Secretary, carry out a grant 

7 program to make grants to covered banks, or per8 sons seeking to become or in the process of becom9 ing covered banks, to carry out the activities de10 scribed in subsection (b). 

11 (2) CONSIDERATIONS FOR ELIGIBILITY.— 

12 (A) REQUIRED CONSIDERATIONS.—When 

13 determining eligibility for grants under this sec14 tion, the Board of Governors and the Secretary 

15 shall consider, among other factors, the extent 

16 to which a grant applicant has established an 

17 appropriate degree of community involvement 

18 and oversight, including dedicated community 

19 representation on the governing board, and evi20 dence of support or commitment from commu21 nity representative organizations. 

22 (B) PROHIBITED CONSIDERATION.—When 

23 determining eligibility for grants under this sec24 tion, the Board of Governors and the Secretary 

25 may not consider the budgetary or financial 


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1 health of the entity that wholly owns or controls 

2 a covered bank. 

3 (b) USE OF FUNDS.—An entity that receives a grant 

4 under this section may use the grant funds— 

5 (1) to carry out activities related to bank for6 mation, chartering, and regulatory compliance; 

7 (2) for capitalization; 

8 (3) to make payments and develop financial 

9 market infrastructure; 

10 (4) to carry out activities related to information 

11 and communications technology; 

12 (5) to support operations; 

13 (6) to cover unexpected losses; and 

14 (7) to carry out such other activities as the 

15 Board of Governors and the Secretary determine ap16 propriate. 

17 (c) MATCHING FUNDS.—The Board of Governors 

18 and the Secretary may not require that an entity that re19 ceives a grant under this section provide matching funds 

20 with respect to such grant. 

21 SEC. 502. PUBLIC BANK INCUBATOR PROGRAM. 

22 (a) IN GENERAL.—The Board of Governors shall es23 tablish an incubator program to provide technical and 

24 technological assistance to persons seeking to be chartered 


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1 by the Board of Governors under section 101 or to obtain 

2 a certificate of Federal recognition under section 102. 

3 (b) APPLICATION.—The Board of Governors, in co4 ordination with the Secretary, the Corporation, and the 

5 Commission, shall establish a single application and review 

6 process for persons seeking to— 

7 (1) be federally chartered under section 101; 

8 (2) obtain a certificate of Federal recognition 

9 under section 102; 

10 (3) become a public member bank; 

11 (4) obtain a license to issue federally-recognized 

12 public securities under section 201; 

13 (5) obtain public deposit insurance pursuant to 

14 section 301 or from a Corporation-approved alter15 native provider; and 

16 (6) apply for a grant under section 401. 

17 SEC. 503. COMMUNITY DEVELOPMENT GRANT PROGRAM. 

18 (a) REASONABLE EFFORTS TO COORDINATE.—Cov19 ered banks shall, where and as appropriate, make reason20 able efforts to coordinate activities with community devel21 opment financial institutions, minority deposit institu22 tions, and credit unions to promote community develop23 ment and ensure community-oriented financial services are 

24 universal and comprehensively include historically ex25 cluded and marginalized groups. 


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1 (b) GRANTS FOR COORDINATION.—The Board of 

2 Governors shall, jointly with the Secretary, award grants 

3 to covered banks, community development financial insti4 tutions, minority deposit institutions, and credit unions to 

5 facilitate coordination of activities under subsection (a). 

6 (c) DEFINITIONS.—In this section: 

7 (1) COMMUNITY DEVELOPMENT FINANCIAL IN8 STITUTION.—The term ‘‘community development fi9 nancial institution’’ has the meaning given the term 

10 in section 103(5) of the Riegle Community Develop11 ment and Regulatory Improvement Act of 1994 (12 

12 U.S.C. 4702(5)). 

13 (2) CREDIT UNION.—The term ‘‘credit union’’ 

14 means a Federal credit union or a State credit union 

15 (as such terms are defined in section 101 of the 

16 Federal Credit Union Act (12 U.S.C. 1752)). 

17 (3) MINORITY DEPOSIT INSTITUTION.—The 

18 term ‘‘minority deposit institution’’ has the meaning 

19 given the term in section 308(b)(1) of the Financial 

20 Institutions Reform, Recovery, and Enforcement Act 

21 of 1989 (12 U.S.C. 1463(b)(1)). 

22 SEC. 504. TREATMENT OF FUNDING. 

23 Any expenses incurred by the Board of Governors 

24 under this title shall be recorded— 


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1 (1) in an account to be known as the ‘‘Special 

2 Public Bank Development Programs’’ established at 

3 the Federal Reserve Bank of New York; and 

4 (2) as a deferred asset (as described in section 

5 11.96 of the Financial Accounting Manual for Fed6 eral Reserve Banks, as in effect on the date of the 

7 enactment of this Act) and maintained separately 

8 from the balance sheet of the Federal Reserve Bank 

9 of New York and the Federal Reserve System, so as 

10 to not reduce or impact the calculation of total in11 come or revenue generated by the Federal Reserve 

12 System, or otherwise reduce the total amount of net 

13 operating profits to be made available for remittance 

14 to the Treasury on an ongoing basis. 

Æ 


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