PORTLAND, Ore. (2/13/12)--Portland, Ore., Mayor Sam Adams has introduced a resolution under which the city will re-examine its investment practices and allow more investment in local financial institutions, including credit unions.
"I believe we should do as much business locally as is feasible, as a city and as individuals," Adams told the Northwest Credit Union Association. "I've long had a 'buy local' passion. This isn't to take away from national or international corporations. Responsible banking is one of the reasons I was attracted to and supported Occupy Wall Street."
Portland currently has roughly $7.2 million in accounts with Wells Fargo, which was selected through a public bidding process in 2009. Umpqua Bank, based in Portland, also holds nearly $30 million of the city's funds. The proposal would have the city deposit up to $250,000 in 10 credit unions and community banks this year.
While the Portland recognizes the importance of national banks and the indispensable services they provide, the city also recognizes the value of having a portfolio that includes local investments in community-based institutions," Adams wrote in a blog post.
"In order to better serve these priorities--while still maintaining the stated principal, liquidity, and return goals of the Investment Policy--the city would like to be able to explore potential options for investment in credit unions and community-based banks and to include community investment practices as part of the evaluation criteria for selecting banking services in future contracting opportunities," Adams wrote. "This draft resolution seeks to accomplish those goals."
Current Oregon law only allows local governments to invest up to the limits of the National Credit Union Administration insurance, which is currently at $250,000. This will change in 2013 when Oregon House Bill 3700 takes effect. The bill will allow credit unions to become approved by the state treasurer if they meet the same collateralization requirements as banks.
While current Oregon statute does allow the city of Portland to invest up to $250,000 in local credit unions, the city's investment policy does not. The draft resolution amends the city's investment policy to allow investments up to the $250,000 in credit unions.
Adams was seeking input from the public through Friday.