Oakland's City Council voted Tuesday not to extend the city's municipal banking contract with JPMorgan Chase & Co. to protest the bank's investment in the Dakota Access Pipeline, private prisons, and a branch closure — but later held a re-vote to keep the relationship for another year.
City staff said the move could have interfered with Oakland’s ability to pay employees and contractors at the end of the current contract with Chase on March 17. City Administrator Sabrina Landreth asked for a year to take proposals from other banks and prepare a new contract.
Chase’s relationship with private prisons, its behavior while operating in Oakland, and its investments in companies involved with the Dakota Access Pipeline were all cited as reasons why several members wanted to end the contract. Three voted to end the contract immediately, while Dan Kalb and Noel Gallo voted to keep it for now.
"When we do bid for banking services, we make sure that any bank or institution that wants to do business in Oakland is not an investor in the Dakota Access Pipeline," Gallo said.
Part of the city’s strategy in moving away from Chase could involve its early plans to create a public bank; the City Council is waiting to find out how much a feasibility study for the bank will cost.
The pipeline generated widespread protests, but the Trump administration signed an order to move forward with construction in his first week in office.
Regardless, demonstrations have continued nationwide, including in Oakland, where a large group marched to banks downtown just hours before the City Council vote. Divestment proponents held a symbolic boxing match between the various banks and "Planet Earth," with Earth ultimately triumphing.
Some protesters at the meeting argued that the city should end its relationship with Chase but recognized that without a plan in place, the city could not withdraw funds immediately. Instead, they called for a resolution to end the relationship in 2018 after the bidding process.
The initial vote to cancel the Chase contract came as a surprise. Needing five votes to pass it, the council voted 4-3 while Councilwoman Lynette Gibson McElhaney was out of the room.
When Councilwoman Rebecca Kaplan, a vocal opponent of the pipeline project, allowed a re-vote, McElhaney explained she had stepped away because a friend was having a medical emergency and said ending the Chase contract immediately was irresponsible.
“We have 5,000 employees that would have been impacted by our loss of payroll," McElhaney said.
The council has officially opposed the DAPL pipeline by passing a resolution against its construction and by encouraging CalPERS, the state’s retirement system, to divest from banks that have invested in the pipeline’s construction.
In voting no, Reid, who represents East Oakland, said he was opposed to Chase because it closed its office in his district.
"They abandoned my district and they have yet to justify to me closing their office down in Durant Square," he said. "They have inconvenienced my constituents and now we have to either do our banking in city of San Leandro or come to downtown Oakland."
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