By Chase DiFeliciantonio, North Bay Business Journal. A bill that would allow some municipalities to establish their own banks in California edged through a state committee Wednesday.

The legislation, Assembly Bill 857, passed the Senate Governance and Finance Committee on a 4-3 vote with the support of Chairman Mike McGuire, D-Healdsburg.

Authored by Assemblymen David Chiu, D-San Francisco, and Miguel Santiago, D-Los Angeles, the bill would allow local governments of a certain size to create publicly owned banks with the goal of divesting from large banks invested in the fossil fuel industry, private prisons, and other industries while investing local tax money back into communities.

Municipalities could also band together to create joint powers authorities under the bill.

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