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 Serv-
ices, 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 com-
mittee concerned 
A BILL 
To provide for the Federal charter of certain public banks, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Public Banking Act of 2020’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
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(C) digital dollar services as a pass- 
through intermediary for the Federal Govern-
ment; 
(D) depository services; 
(E) postal banking services; 
(F) securities-related services; or 
(G) any lending product approved by the 
Board of Governors. 
(c) PUBLIC PAYMENT BANK DEFINED.—The term 
‘‘public payment bank’’ means a person that— 
(1) is wholly owned and controlled by an entity 
described in subsection (b)(1); 
(2) provides at least one of the services speci-
fied in subparagraphs (A) through (E) of subsection 
(b)(2); and 
(3) does not provide the services specified in 
subparagraph (F) or (G) of subsection (b)(2). 
(d) EXCEPTION
OF
CERTAIN
PUBLIC
LENDING 
BANKS FROM CONSIDERATION AS BANK HOLDING COM-
PANY.—A person described in subsection (b) shall not be 
considered a bank holding company under the Bank Hold-
ing Company Act of 1956 (12 U.S.C. 1841 et seq.) or 
any other law, solely due to the person’s ownership or con-
trol of a public lending bank, public payment bank, or non- 
federally chartered bank. 
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(e) GUIDANCE WITH RESPECT TO EXCLUDED AND 
MARGINALIZED GROUPS.—The Board of Governors shall 
issue guidance to public lending banks and public payment 
banks to ensure that the services provided by such banks 
are universal and comprehensively include historically ex-
cluded and marginalized groups. 
SEC. 102. FEDERAL RECOGNITION OF NON-FEDERALLY 
CHARTERED BANKS. 
(a) CERTIFICATES OF RECOGNITION.—The Board of 
Governors shall issue certificates of Federal recognition to 
non-federally chartered banks. 
(b) 
NON-FEDERALLY
CHARTERED
BANK
DE-
FINED.—The term ‘‘non-federally chartered bank’’ means 
a person that is— 
(1) wholly owned and controlled by an entity 
described in section 101(b)(1); and 
(2) either— 
(A) chartered as a non-depository institu-
tion by an approved non-Federal financial regu-
lator described in subsection (c); or 
(B) insured as a depository institution by 
the Corporation, or under an alternate public 
deposit insurance scheme approved by the Cor-
poration. 
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(c) LIST OF APPROVED NON-FEDERAL FINANCIAL 
REGULATORS.—The Board of Governors shall establish 
and maintain on a public website of the Board of Gov-
ernors a list of approved non-Federal financial regulators 
for the purpose of determining eligibility for a certificate 
of Federal recognition under this section. 
(d) CONVERSION.—At the request of a non-federally 
chartered bank, the Board of Governors may convert such 
bank into a public payment bank or a public lending bank. 
(e) SERVICES.—A non-federally chartered bank— 
(1) may not offer depository services before— 
(A) obtaining— 
(i) deposit insurance or conditional 
deposit insurance from the Corporation; or 
(ii) deposit insurance from alternate 
public deposit insurance scheme approved 
by the Corporation; and 
(B) becoming a public member bank or a 
conditional public member in accordance with 
section 103(b); and 
(2) may— 
(A) invest any funds held on behalf of an 
entity described in section 101(b)(1) in a fiscal 
agent account; 
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(B) provide fiscal agent services, including 
sending and receiving money and effectuating 
payments to and from any entity whose funds 
are invested in a fiscal agent account; 
(C) invest any funds held on behalf of an 
entity not described in section 101(b)(1) in a 
payments account or as digital dollar products; 
and 
(D) provide money transmitter and digital 
dollar services. 
(f) GUIDANCE WITH RESPECT TO EXCLUDED AND 
MARGINALIZED GROUPS.—Not later than 1 year after the 
date of the enactment of this Act, the Board of Governors 
shall issue guidance to non-federally chartered banks to 
ensure that the services provided by such banks are uni-
versal and comprehensively include historically excluded 
and marginalized groups. 
SEC. 103. FEDERAL RESERVE SYSTEM MEMBERSHIP. 
(a) ELIGIBILITY.—A covered bank shall be eligible 
for membership in the Federal Reserve System as a public 
member bank and, except as provided in subsection (c), 
shall be treated in the same manner as a member bank 
under section 4 of the Federal Reserve Act (12 U.S.C. 
308). 
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(b) CONDITIONAL PUBLIC MEMBER BANK.—The 
Board of Governors shall establish a special category of 
public member bank, called a ‘‘conditional public member 
bank’’, for persons that are in the process of applying for 
becoming a covered bank. Such conditional public member 
banks shall be subject to such conditions and restrictions 
as the Board of Governors determines to be necessary and 
appropriate to promote public welfare, provided that such 
conditions and restrictions are not arbitrary, punitive, or 
unduly burdensome. 
(c) PURCHASING STOCK.—The Board of Governors 
may not require a covered bank to purchase stock in a 
Federal Reserve Bank or otherwise maintain paid-in cap-
ital in the Federal Reserve System. 
SEC. 104. PUBLIC MEMBER BANK SERVICES. 
(a) PURPOSES OF SERVICES.—The Board of Gov-
ernors shall offer the services described in subsection (b) 
to public member banks in order to— 
(1) promote the safety, soundness, viability, and 
resiliency of publicly owned and operated financial 
institutions; 
(2) facilitate the provision of payments, credit, 
and other financial services as a public good; and 
(3) support the financial and budgetary health 
of State and Tribal governments, local government 
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units, government agencies, State or tribally char-
tered corporations, nonprofit entities designated by a 
State or Tribal government to be acting in the pub-
lic interest of a community within such State or 
Tribe, or an association of one or more of such enti-
ties. 
(b) SERVICES.—The Board of Governors shall offer 
the following services to public member banks: 
(1) Fiscal agent accounts— 
(A) in which public member banks may in-
vest funds held on behalf of any entity de-
scribed in section 101(b)(1); and 
(B) under which— 
(i) the Board of Governors shall pay 
interest on all balances held overnight in 
such fiscal agent accounts at a rate that is 
greater than or equal to the greater of— 
(I) the sum of the overnight pol-
icy target rate plus two percent; or 
(II) the daily rate on 30-year 
marketable Treasury bonds; and 
(ii) the interest described in clause (i) 
(minus a reasonable administrative fee im-
posed by the public member bank) shall be 
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paid to the entity for which the public 
member bank invested such funds. 
(2) Payment accounts— 
(A) in which public member banks may in-
vest funds held on behalf of any entity other 
than an entity described in section 101(b)(1) 
for purposes of providing money transmitter 
services; and 
(B) under which the Board of Governors 
shall pay interest (minus a reasonable adminis-
trative fee) on all balances held overnight in 
such fiscal agent accounts at a rate that is 
greater than or equal to the greater of the fol-
lowing: 
(i) The overnight rate paid on re-
quired reserves. 
(ii) The overnight night paid on ex-
cess reserves. 
(3)(A) Digital dollar services in which public 
member banks may operate as pass-through inter-
mediaries for any digital dollar or other financial 
services offered by the Federal Government, includ-
ing— 
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(i) digital dollar account wallets ad-
ministered by the Board of Governors 
(commonly known as ‘‘FedAccounts’’); 
(ii) digital dollar cash wallets adminis-
tered by the Secretary (commonly known 
as ‘‘eCash’’); and 
(iii) postal banking services provided 
by the United States Postal Service. 
(B) The Board of Governors may issue regula-
tions as necessary to ensure effective harmonization 
and coordination between covered banks and any en-
tities responsible for administering digital dollar 
services on behalf of the Federal Government. 
(4)(A) A facility (to be known as the ‘‘Public 
Bank Primary Liquidity Facility’’) to provide liquid-
ity to public member banks by buying or lending (at 
a reasonable rate of interest that is not greater than 
the overnight policy target rate) against federally 
recognized public loans (as described in section 105) 
and federally-recognized public securities (as de-
scribed in section 201(b)), under terms and condi-
tions that the Board of Governors determines to be 
necessary and appropriate to promote public welfare. 
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(B) The facility under subparagraph (A) shall 
purchase or accept loans or securities under such 
subparagraph at face value. 
(5)(A) A facility (to be known as the ‘‘Public 
Bank Supplementary Liquidity Facility’’) to provide 
liquidity to public member banks by buying or lend-
ing (at a reasonable rate of interest that is not 
greater than the overnight policy target rate) 
against assets not otherwise eligible to be purchased 
or accepted as collateral under paragraph (4). 
(B) The facility under subparagraph (A) may 
purchase or accept assets as collateral under such 
subparagraph at a reasonable discount. 
(6) A facility (to be known as the ‘‘Public Bank 
Credit Facility’’) to provide credit to public member 
banks on an unsecured basis, in such amounts and 
such rates of interests as the Board of Governors 
determines to be necessary and appropriate to pro-
mote public welfare. 
(7) A facility (to be known as the ‘‘Federally 
Recognized Public Loan Facility’’) to, in consulta-
tion with the Corporation— 
(A) develop rules, standards, and criteria 
for Federal recognition of loans, mortgages, 
credit cards, account overdrafts, and other di-
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rect lending products issued by public member 
banks; and 
(B) provide prepurchase agreements under 
which the facility will purchase loans and agree 
that such loans will be repurchased by the pub-
lic member bank at such time as is agreed upon 
by such facility and member bank. 
(c) ADMINISTRATIVE, OPERATING, AND MAINTE-
NANCE COSTS.—The Board of Governors shall pay all ad-
ministrative, operating, and maintenance costs associated 
with the accounts, services, and facilities described in sub-
section (b). 
(d) REIMBURSEMENT.—The Board of Governors 
shall reimburse a public member bank for any expenses 
reasonably incurred in the process of operating as a pass- 
through intermediary described in subsection (b)(3). 
(e) EXPENSES.— 
(1) MEMBER
SERVICES.—Any expenses in-
curred by the Board of Governors under paragraphs 
(1) through (3) of subsection (b) and under sub-
sections (c) and (d) shall be recorded— 
(A) in an account to be known as the 
‘‘Special Public Member Bank Services Ac-
count’’ established at the Federal Reserve Bank 
of New York; and 
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(B) as a deferred asset (as described in 
section 11.96 of the Financial Accounting Man-
ual for Federal Reserve Banks, as in effect on 
the date of the enactment of this Act) and 
maintained separately from the balance sheet of 
the Federal Reserve Bank of New York and the 
Federal Reserve System, so as to not reduce or 
impact the calculation of total income or rev-
enue generated by the Federal Reserve System, 
or otherwise reduce the total amount of net op-
erating profits to be made available for remit-
tance to the Treasury on an ongoing basis. 
(2) FACILITIES.—Any expenses incurred by the 
Board of Governors under paragraphs (4) through 
(7) of subsection (b) shall be recorded— 
(A) in an account to be known as the 
‘‘Special Public Member Bank Liquidity and 
Credit Account’’ established at the Federal Re-
serve Bank of New York; and 
(B) as a deferred asset (as described in 
section 11.96 of the Financial Accounting Man-
ual for Federal Reserve Banks, as in effect on 
the date of the enactment of this Act) and 
maintained separately from the balance sheet of 
the Federal Reserve Bank of New York and the 
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Federal Reserve System, so as to not reduce or 
impact the calculation of total income or rev-
enue generated by the Federal Reserve System, 
or otherwise reduce the total amount of net op-
erating profits to be made available for remit-
tance to the Treasury on an ongoing basis. 
SEC. 105. SPECIFIC REQUIREMENTS RELATING TO COV-
ERED BANKS. 
(a) TERMS OF RETAIL ACCOUNT SERVICES.—Any 
covered bank that holds, administers, or manages funds 
on behalf of any unincorporated person in a payments ac-
count, or otherwise accepts funds on deposit or for the 
purpose of providing public depository accounts services— 
(1) may not— 
(A) impose any fees, minimum balances, or 
maximum balances on such payments accounts 
or public depository accounts; or 
(B) include on such payments accounts or 
public depository accounts; 
(2) shall— 
(A) prominently brand any such payments 
account or public depository account as a ‘‘pub-
lic bank account’’ in all account statements, 
marketing materials, and other communications 
of the public bank; and 
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(B) provide such account holders with rea-
sonable protection against losses caused by 
fraud or security breaches, as determined by 
the Corporation or the Director of the Bureau 
of Consumer Financial Protection, or both; and 
(3) may only close or restrict access to such 
payments accounts or public depository accounts on 
the basis of the mandate of the covered bank. 
(b) TERMS OF RETAIL CREDIT.— 
(1) IN GENERAL.—Notwithstanding any provi-
sion of law, the annual percentage rate applicable to 
any extension of credit by a covered bank may not 
exceed the lesser of— 
(A) 15 percent on unpaid balances, inclu-
sive of all finance charges; or 
(B) the maximum rate permitted by the 
laws of the State in which the consumer resides. 
(2) OTHER FEES.—Any fees that are not con-
sidered finance charges under paragraph (1), includ-
ing fees for ancillary products and services, may 
not— 
(A) exceed the total amount of finance 
charges assessed; and 
(B) be imposed in such a way as to evade 
or frustrate the purpose of limiting the total in-
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terest and related costs that may be charged in 
relation to any lending product issued by cov-
ered banks under this Act. 
(3) PENALTIES FOR CHARGING HIGHER RATES 
ON RETAIL CREDIT.— 
(A) VIOLATION.—The taking, receiving, re-
serving, or charging of an annual percentage 
rate or fee greater than that permitted by para-
graph (1), when knowingly done, shall be a vio-
lation of this subsection, and a forfeiture of the 
entire interest which the note, bill, or other evi-
dence of the obligation carries with it, or which 
has been agreed to be paid thereon. 
(B) REFUND OF INTEREST AMOUNTS.— 
(i) IN GENERAL.—With respect to a 
person charging interest, a finance charge, 
or a fee greater than that permitted by 
paragraph (1), the person paying such in-
terest, finance charge, or fee may notify 
the Bureau of Consumer Financial Protec-
tion, and the Bureau of Consumer Finan-
cial Protection shall take such enforcement 
actions as the Director of the Bureau of 
Consumer Financial Protection determines 
appropriate. 
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(ii) LACK OF BUREAU ACTION.—If a 
person notifies the Bureau of Consumer 
Financial Protection under clause (i), and 
the Bureau of Consumer Financial Protec-
tion takes no action with respect to such 
notice during the 60-day period following 
such notice, such person may bring an ac-
tion in a Federal district court to recover 
the entire amount of interest, finance 
charges, or fees paid. 
(C) CIVIL
LIABILITY.—Any creditor who 
violates this subsection shall be subject to the 
provisions of section 130(a) of the Truth in 
Lending Act (15 U.S.C. 1640(a)). 
(D) BANK SECRECY ACT.—In establishing 
and maintaining personal accounts, each cov-
ered bank shall comply with— 
(i) section 21 of the Federal Deposit 
Insurance Act (12 U.S.C. 1829b); 
(ii) section 123 of Public Law 91– 
508; and 
(iii) subchapter II of chapter 53 of 
title 31, United States Code. 
(c) ANNUAL
REPORTING
REQUIREMENTS.—Each 
covered bank shall make publicly available an annual re-
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port on the activities of such covered bank, including re-
cipients of financial services, sources of funding, financial 
reporting, and evaluation of the effectiveness of the cov-
ered bank’s services in achieving the public purposes for 
which it was chartered, as well as any other purposes, 
goals, and targets under this Act or other law or regula-
tion. 
SEC. 106. REGULATIONS. 
(a) IN GENERAL.—Not later than 1 year after the 
date of the enactment of this Act, the Board of Governors, 
the Director of the Bureau of Consumer Financial Protec-
tion, and the Corporation shall jointly— 
(1) establish a separate regulatory scheme with 
respect to public lending banks, public payment 
banks, and non-federally chartered banks that re-
ceive or are in the process of receiving a certificate 
of Federal recognition under section 102; and 
(2) after a notice and comment period during 
which consumer advocacy organizations shall be in-
vited to submit feedback and suggestions, and issue 
such regulations as are necessary and appropriate to 
promote public welfare with respect to public lending 
banks, public payment banks, and non-federally 
chartered banks that receive or are in the process of 
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receiving a certificate of Federal recognition under 
section 102. 
(b) REGULATIONS WITH RESPECT TO EXCLUDED 
AND MARGINALIZED GROUPS.— 
(1) IN GENERAL.—Not later than 1 year after 
the date of the enactment of this Act, the Board of 
Governors shall issue regulations for public lending 
banks and public payment banks to ensure that the 
services provided by such banks are universal and 
comprehensively include historically excluded and 
marginalized groups. 
(2) LIMITATIONS.—A regulation issued under 
this subsection may not— 
(A) supersede or supplant any other 
stronger regulations or standards promulgated 
by other Federal or applicable State regulatory 
entities, including any such regulation issued by 
the Corporation or the Director of the Bureau 
of Consumer Financial Protection; and 
(B) result in less robust or less stringent 
protections to consumers than protections that 
exist on the date of the enactment of this Act 
for consumers served by other existing cat-
egories of depository institutions, including pro-
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tection under the Community Reinvestment Act 
of 1977 (12 U.S.C. 2901 et seq.). 
(3) DATA
REPORTING.—The Board of Gov-
ernors and the Corporation shall jointly, in a man-
ner that respects the privacy of covered bank cus-
tomers to the greatest extent possible, develop an 
annual assessment for determining if covered banks 
have appropriately provided services to all customers 
within the jurisdiction of service, based on demo-
graphic information chosen by regulators, including 
race, gender, and area median income of such cus-
tomers. 
(c) ECOLOGICAL SUSTAINABILITY CONSIDERATIONS 
AND PROHIBITIONS ON FOSSIL FUEL INVESTMENT.— 
(1) IN GENERAL.—The Board of Governors, the 
Corporation, and the Commission shall jointly de-
velop and promulgate rules and regulations to— 
(A) ensure that any and all activities un-
dertaken and services offered by a covered 
bank, or any person seeking or in the process 
of becoming a covered bank, are consistent with 
Federal and scientifically established standards, 
goals, and targets with respect to ecological sus-
tainability, 
climate 
crisis-mitigation, 
and 
decarbonization; and 
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(B) require that any covered bank or per-
son seeking or in the process of becoming a cov-
ered bank, may not facilitate fossil fuel produc-
tion or infrastructure, including by— 
(i) providing loans to, making invest-
ments in, or otherwise engaging in any ac-
tivity that is financial in nature, or inci-
dental to such financial activity, with a fos-
sil fuel company; 
(ii) providing loans to, making invest-
ments in, or otherwise engaging in any ac-
tivity that is financial in nature, or inci-
dental to such financial activity, for a fossil 
fuel project; 
(iii) taking compensation to arrange 
or facilitate a transaction that provides 
funds for fossil fuel production from new 
sources; 
(iv) securitizing assets that provide 
funds for fossil fuel production from new 
sources; 
(v) entering into a derivatives trans-
action designed to provide funding for, fa-
cilitate, or hedge risks from fossil fuel pro-
duction from new sources; and 
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(vi) engaging in any activity that is 
complementary to a financial activity in-
volving fossil fuel production from new 
sources, including financing the inter-
national trade thereof; or any other form 
of activity defined by regulators or super-
visors of the covered bank. 
(2) DEFINITIONS.—In this subsection: 
(A) FOSSIL FUEL.—The term ‘‘fossil fuel’’ 
means coal, petroleum, natural gas, or any de-
rivative of coal, petroleum, or natural gas that 
is used for fuel. 
(B) FOSSIL INFRASTRUCTURE.—The term 
‘‘fossil infrastructure’’ means fossil fuel-related 
projects, including wells, rail infrastructure, 
pipelines, terminals, refineries, and power 
plants. 
(C) NEW
SOURCES.—The term ‘‘new 
sources’’ means— 
(i) any production in excess of proven 
developed producing reserves of fossil fuels 
as of the date of enactment of this section; 
or 
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(ii) new or expanded fossil infrastruc-
ture that would facilitate the production 
described in subparagraph (A). 
(D) PRODUCTION.—The term ‘‘produc-
tion’’ means extractive or production activities 
that result in fossil fuels being made available 
for refining or use. 
(d) STATE LAW.—Nothing in this section may be 
construed to preempt any provision of State law that pro-
vides greater protection to consumers, or establishes more 
stringent environmental or ecological regulations, than is 
provided in this section. 
SEC. 107. TECHNICAL ASSISTANCE. 
The Board of Governors shall provide technical as-
sistance to public member banks to develop, use, and share 
financial and infrastructure technologies, practices, and 
operational and business practice data that promote the 
public welfare, however such data may not include any 
customer data, including transactional and identifying in-
formation. 
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TITLE 
II—FEDERAL 
RECOGNI-
TION OF PUBLIC SECURITIES 
SEC. 201. REGULATION OF PUBLIC LENDING BANKS AND 
NON-FEDERALLY CHARTERED BANKS. 
(a) IN GENERAL.—The Commission shall establish a 
separate registration and regulatory scheme for licensing 
and regulating as public investment entities all public 
lending banks and non-federally chartered banks that en-
gage or seek to engage in securities-related activities, in-
cluding origination, investment brokering, dealing, and 
trading of federally-recognized public securities. 
(b) 
FEDERALLY-RECOGNIZED
PUBLIC
SECURI-
TIES.—The Board of Governors shall, in consultation with 
the Commission, develop rules, standards, and criteria for 
Federal recognition of securities issued by public member 
banks (to be known as ‘‘federally-recognized public securi-
ties’’) as the Commission determines to be necessary and 
appropriate to promote public welfare. 
(c) CONDITIONAL LICENSE.—The Commission shall 
establish a special category of public investment entity li-
cense for entities that are in the process of applying for, 
but have not yet received, any license to issue federally- 
recognized public securities, which shall be subject to such 
conditions and restrictions as the Commission determines 
to be necessary and appropriate to promote public welfare. 
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TITLE III—PUBLIC DEPOSIT 
INSURANCE 
SEC. 301. IN GENERAL. 
(a) PUBLIC DEPOSIT INSURANCE.—The Corporation 
shall establish a separate registration and regulatory 
scheme for providing deposit insurance (to be known as 
‘‘public deposit insurance’’) to covered banks and make 
such deposit insurance available to covered banks without 
regard to the total deposit amount. 
(b) CONDITIONAL
INSURANCE.—The Corporation 
shall establish a separate registration and regulatory 
scheme for providing deposit insurance (to be known as 
‘‘conditional public deposit insurance’’) for entities that 
are in the process of applying for, but have not yet re-
ceived, public deposit insurance, which shall be subject to 
such conditions and restrictions as the Corporation deter-
mines to be necessary and appropriate to promote public 
welfare. 
TITLE IV—POSTAL BANKING 
SEC. 401. PARTNERSHIPS WITH COVERED BANKS FOR 
POSTAL BANKING SERVICES. 
(a) PARTNERSHIP WITH USPS.—Notwithstanding 
section 404(e)(2) of title 36, United States Code, the 
Postmaster General shall, to the maximum extent prac-
ticable, partner with covered banks to make available re-
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tail account and payment services provided by covered 
banks at post offices, and via any postal banking plat-
forms established by the United States Postal Service. 
(b) FUNDING.—The Board of Governors shall provide 
such funding to the United States Postal Service as the 
Postmaster General determines to be necessary to achieve 
carry out subsection (a). 
(c) TREATMENT OF EXPENSES.—Any expenses in-
curred by the Board of Governors under this section shall 
be recorded— 
(1) in an account to be known as the ‘‘Special 
Public Member Bank Services Account’’ established 
at the Federal Reserve Bank of New York; and 
(2) as a deferred asset (as described in section 
11.96 of the Financial Accounting Manual for Fed-
eral Reserve Banks, as in effect on the date of the 
enactment of this Act) and maintained separately 
from the balance sheet of the Federal Reserve Bank 
of New York and the Federal Reserve System, so as 
to not reduce or impact the calculation of total in-
come or revenue generated by the Federal Reserve 
System, or otherwise reduce the total amount of net 
operating profits to be made available for remittance 
to the Treasury on an ongoing basis. 
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TITLE V—PUBLIC BANK 
DEVELOPMENT PROGRAMS 
SEC. 501. PUBLIC BANK GRANT PROGRAM. 
(a) PROGRAM ESTABLISHED.— 
(1) IN
GENERAL.—The Board of Governors 
shall, jointly with the Secretary, carry out a grant 
program to make grants to covered banks, or per-
sons seeking to become or in the process of becom-
ing covered banks, to carry out the activities de-
scribed in subsection (b). 
(2) CONSIDERATIONS FOR ELIGIBILITY.— 
(A) REQUIRED
CONSIDERATIONS.—When 
determining eligibility for grants under this sec-
tion, the Board of Governors and the Secretary 
shall consider, among other factors, the extent 
to which a grant applicant has established an 
appropriate degree of community involvement 
and oversight, including dedicated community 
representation on the governing board, and evi-
dence of support or commitment from commu-
nity representative organizations. 
(B) PROHIBITED CONSIDERATION.—When 
determining eligibility for grants under this sec-
tion, the Board of Governors and the Secretary 
may not consider the budgetary or financial 
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health of the entity that wholly owns or controls 
a covered bank. 
(b) USE OF FUNDS.—An entity that receives a grant 
under this section may use the grant funds— 
(1) to carry out activities related to bank for-
mation, chartering, and regulatory compliance; 
(2) for capitalization; 
(3) to make payments and develop financial 
market infrastructure; 
(4) to carry out activities related to information 
and communications technology; 
(5) to support operations; 
(6) to cover unexpected losses; and 
(7) to carry out such other activities as the 
Board of Governors and the Secretary determine ap-
propriate. 
(c) MATCHING FUNDS.—The Board of Governors 
and the Secretary may not require that an entity that re-
ceives a grant under this section provide matching funds 
with respect to such grant. 
SEC. 502. PUBLIC BANK INCUBATOR PROGRAM. 
(a) IN GENERAL.—The Board of Governors shall es-
tablish an incubator program to provide technical and 
technological assistance to persons seeking to be chartered 
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by the Board of Governors under section 101 or to obtain 
a certificate of Federal recognition under section 102. 
(b) APPLICATION.—The Board of Governors, in co-
ordination with the Secretary, the Corporation, and the 
Commission, shall establish a single application and review 
process for persons seeking to— 
(1) be federally chartered under section 101; 
(2) obtain a certificate of Federal recognition 
under section 102; 
(3) become a public member bank; 
(4) obtain a license to issue federally-recognized 
public securities under section 201; 
(5) obtain public deposit insurance pursuant to 
section 301 or from a Corporation-approved alter-
native provider; and 
(6) apply for a grant under section 401. 
SEC. 503. COMMUNITY DEVELOPMENT GRANT PROGRAM. 
(a) REASONABLE EFFORTS TO COORDINATE.—Cov-
ered banks shall, where and as appropriate, make reason-
able efforts to coordinate activities with community devel-
opment financial institutions, minority deposit institu-
tions, and credit unions to promote community develop-
ment and ensure community-oriented financial services are 
universal and comprehensively include historically ex-
cluded and marginalized groups. 
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(b) GRANTS
FOR COORDINATION.—The Board of 
Governors shall, jointly with the Secretary, award grants 
to covered banks, community development financial insti-
tutions, minority deposit institutions, and credit unions to 
facilitate coordination of activities under subsection (a). 
(c) DEFINITIONS.—In this section: 
(1) COMMUNITY DEVELOPMENT FINANCIAL IN-
STITUTION.—The term ‘‘community development fi-
nancial institution’’ has the meaning given the term 
in section 103(5) of the Riegle Community Develop-
ment and Regulatory Improvement Act of 1994 (12 
U.S.C. 4702(5)). 
(2) CREDIT UNION.—The term ‘‘credit union’’ 
means a Federal credit union or a State credit union 
(as such terms are defined in section 101 of the 
Federal Credit Union Act (12 U.S.C. 1752)). 
(3) MINORITY
DEPOSIT
INSTITUTION.—The 
term ‘‘minority deposit institution’’ has the meaning 
given the term in section 308(b)(1) of the Financial 
Institutions Reform, Recovery, and Enforcement Act 
of 1989 (12 U.S.C. 1463(b)(1)). 
SEC. 504. TREATMENT OF FUNDING. 
Any expenses incurred by the Board of Governors 
under this title shall be recorded— 
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(1) in an account to be known as the ‘‘Special 
Public Bank Development Programs’’ established at 
the Federal Reserve Bank of New York; and 
(2) as a deferred asset (as described in section 
11.96 of the Financial Accounting Manual for Fed-
eral Reserve Banks, as in effect on the date of the 
enactment of this Act) and maintained separately 
from the balance sheet of the Federal Reserve Bank 
of New York and the Federal Reserve System, so as 
to not reduce or impact the calculation of total in-
come or revenue generated by the Federal Reserve 
System, or otherwise reduce the total amount of net 
operating profits to be made available for remittance 
to the Treasury on an ongoing basis. 
Æ 
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