On October 26, 2021, Boston Foundation Vice President of Communications and Public Affairs Keith Mahoney publicly testified on behalf of the Boston Foundation in support of An Act Establishing A Massachusetts Public Bank (H.1223/S.665) and An Act Establishing a Public Bank of Massachusetts (S.682). As part of the testimony, Keith cited data from the Boston Indicators/Coalition for an Equitable Economy May 2021 report titled The Color of the Capital Gap, which revealed how the barriers to accessing capital experienced by entrepreneurs of color are perpetuating the racial wealth gap; the report explored how a public bank could remove these barriers.
Good afternoon, Chair Crighton, Chair Murphy, and other distinguished members of the committee.
My name is Keith Mahoney, and I am the Vice President of Communications and Public Affairs at the Boston Foundation. Today, I am happy to represent the many voices of the Foundation including our President, Lee Pelton, alongside our many valued nonprofit partners, and influential donors to support An Act Establishing a Massachusetts Public Bank.
As you may know, this past spring, the Boston Indicators, the research team housed at the Foundation, released a report in conjunction with the Coalition for an Equitable Economy to trace how systemic and interpersonal racism has held back Greater Boston’s entrepreneurs of color. This report, The Color of the Capital Gap: Increasing Capital Access for Entrepreneurs of Color in Massachusetts traced the historic lack of capital access for Black, Latino and Asian business owners – a result of a wide range of factors that have limited wealth accumulation and excluded entrepreneurs of color from many programs.
Our report showed that there is a nearly half-billion-dollar shortfall of capital needed by entrepreneurs of color in Massachusetts, and not for lack of good ideas, attempts, or dedication. This is not a problem of previous generations or for history books. This is a problem that our entrepreneurs face every single day.
Establishing a public bank in Massachusetts will start to remove these barriers and be a step towards closing the wealth gap. This act will address past and present inequities that our report shows and that are far too present for too many people in our state. These inequities are not just experienced by women or people of color as individuals, but are experienced by whole communities, neighborhoods, businesses, and organizations working hard to achieve economic justice.
We ended our convening on the Color of the Capital report with four recommendations:
- Increase access to small business loans
- Increase access to equity, grants and alternative financing structures
- Regulate the small business financing sector
- Increase the representation of people of color in capital allocation roles
So today, we sit before you and urge you to pass An Act to Establish a Massachusetts Public Bank in order to increase access and representation in Massachusetts. We urge you to be as bold, innovative, and dedicated to investing in our citizens as they are to investing in our economy.