Two state assembly members introduced legislation that would let the California Infrastructure and Economic Development Bank accept deposits from public entities and provide financing to small businesses and local governments.
All U.S. states will be able to have at least two cities or counties eligible to directly issue notes to the Municipal Liquidity Facility program regardless of population.
The central bank expanded the reach of the program as pressure mounts on the government to support localities struggling economically because of the coronavirus pandemic.
Community banks in the state have struggled to attract the funds to meet surging loan demand, but that could change now that a new law has made it easier for them to accept government deposits.
