Bank On Denver Program to Promote Greater Financial Stability for Denver Residents
Denver has been selected by the National League of Cities’ (NLC) Institute for Youth, Education and Families as one of eight cities to participate in the Bank On Cities Campaign, an initiative that expands the ability of communities to help residents achieve greater financial stability. Denver’s selection entitles it to technical assistance to develop a Bank On Denver program that will help residents build and protect assets by promoting connections to the financial mainstream at a time when many families are struggling to make ends meet.
“We are excited at the opportunity this award creates for us to help Denver families toward long-term financial stability,” said Denver Mayor John Hickenlooper. “We look forward to taking full advantage of the expertise of the National League of Cities’ Youth, Education and Families Institute as we develop a Bank On Denver initiative that will give responsible, hard-working citizens a chance to achieve prosperity and financial security.”
Joining the City and County of Denver as lead partners for the program are the Colorado Bankers Association, Credit Union Association of Colorado and Mile High United Way. An additional 12 business and nonprofit partners supported Denver’s application to the NLC.
Modeled after the Bank On San Francisco initiative developed by San Francisco Mayor Gavin Newsom and Treasurer José Cisneros, the Bank On Cities Campaign helps create relationships among local governments, citizens, local banks and credit unions, and community partners to ensure that all residents have access to bank accounts, financial education and other asset-building opportunities. Many families, particularly those with low incomes, rely on payday lenders, check cashers and other high-cost fringe financial services for their banking needs. The project aims to expand families’ access to free and low-cost bank accounts to help them keep more of their paychecks, build savings and establish a credit history.
Bank On Denver will engage banks, credit unions, government and non-profits in a new way of working together to develop programs and products that benefit all stakeholders and the community. With a focus on meeting the market demand of potential customers who currently do not have a bank account, the program will be designed to increase consumer desire to establish relationships with mainstream financial services.
“This program provides a tremendous opportunity for cities to engage their citizens in an effort to build assets and create financially stable households,” said Kathleen M. Novak, president, National League of Cities, and mayor of Northglenn, Colo. “The opportunities this program provides are critical to enhancing the broader economic vitality of cities.”
Throughout the one-year project, Denver will receive intensive technical assistance from NLC through conference calls, Web seminars and convenings with other project cities to engage in peer networking and share successful ideas. The Denver Office of Economic Development will convene local stakeholders for the Bank On Cities Campaign within the next month to initiate Denver’s work on this initiative. City officials will develop action plans to outline the City’s goals in the campaign, using advice and resources from NLC staff and national experts.
The NLC award is a result of recommendations developed by the Denver Economic Prosperity Task Force, a group of citizens, policy makers, businesses, representatives and practitioners convened by the Denver Mayor’s Office and Denver City Council in March 2008. Led by Councilman Doug Linkhart and Denver Office of Economic Development Executive Director André Pettigrew, the task force is making recommendations of strategies, programs and policies that aim to improve the economic prosperity of Denver residents.
Included among the task force recommendations is a strategy to focus on connecting adults with financial resources. The task force identified the use of high-cost financial services such as check cashing and payday lending as one of the key barriers preventing residents from building credit, savings and other assets. According to a Brookings Institute report, Denver residents spent $26 million on payday loan and check cashing fees in 2006, and the average full-time worker who is not using a bank or credit union will spend $40,000 over a lifetime to turn his or her salary into cash.
“After exploring a number of avenues to advance economic prosperity among residents, the task force quickly centered on the need to establish more banking relationships among residents who lack them,” said City Councilman Doug Linkhart. “The task force met with representatives from Bank On San Francisco to investigate this model, and we look forward to laying the groundwork for a similar program in Denver.”
Other cities selected for the project include: Bryan, Texas; Gaithersburg, Md.; Indianapolis, Ind.; Louisville, Ky.; Newark, N.J.; Rapid City, S.D.; and St. Petersburg, Fla.
“Denver is proud to join the ranks of other cities that are actively taking measures to improve financial literacy among residents, and thus creating the means for our citizens to generate more wealth throughout our community,” said Pettigrew.
The Bank On Cities Campaign is supported by the Annie E. Casey Foundation and the Ford Foundation. In 2008, the YEF Institute’s Bank On Cities Campaign provided technical assistance to ten cities, many of which have already launched successful programs to reach “unbanked” residents.
The National League of Cities is the nation’s oldest and largest organization devoted to strengthening and promoting cities as centers of opportunity, leadership and governance. NLC is a resource and advocate for 19,000 cities, towns and villages, representing more than 218 million Americans. www.nlc.org
The Denver Office of Economic Development (OED) is dedicated to advancing economic prosperity for the City of Denver, its businesses, neighborhoods and residents. Working with a wide variety of community partners, OED operates to create a local environment that stimulates balanced growth through job creation, business assistance, housing options, neighborhood redevelopment and the development of a skilled workforce.
National League of Cities