(from the San Francisco Chronicle, 12/21/11):
Oakland council adds debit-card ability to city ID
Matthai Kuruvila, Chronicle Staff Writer
San Francisco Chronicle December 21, 2011 04:00 AM
The Oakland City Council authorized drafting a contract Tuesday to put a debit-card function on the city’s proposed municipal identification card.
The debit-card function had proved to be a major hurdle to issuing the cards, which are designed primarily to give undocumented immigrants a way to prove their identity.
City staffers declared that they didn’t have the expertise to analyze the legal and banking aspects of administering a debit card, something only one city in the nation, much smaller than Oakland, is believed to have done.
In addition, the staff had questions about whether the bank chosen to oversee the card had sufficient financial resources to cover “fraud, theft, market downturns and other problems that could jeopardize cardholder funds.”
Tuesday night, the council members overwhelmingly declared that they were satisfied. The only member who didn’t vote for it was Councilwoman Desley Brooks, who abstained.
“I’m very excited,” said Mayor Jean Quan, who helped draft the original proposal more than 2 1/2 years ago with Councilman Ignacio De La Fuente when she was a member of the council. “I don’t think people realize how complex it is.”
The debit-card function is critical to covering the city’s costs. But there are broader reasons, such as giving those who don’t have bank accounts a secure way to store their money.
“This is an issue of human rights,” said Manuel De Paz, a coordinator with the East Bay Sanctuary Covenant, one of dozens of speakers who advocated for passage of the card.
De Paz said that it would encourage residents to report crimes, work more closely with police and protect immigrants from being robbed because they’re carrying too much cash.
“It’s a very big issue,” he said.
De La Fuente said the community had been done a disservice by the delays.
“People have been desperately waiting for years,” he said. “It’s imperative that we pass this tonight.”
It will take the city at least three months to write the contract with University National Bank of St. Paul, Minn., and SF Global Group of Venice (Los Angeles County), which would be responsible for the card’s operations.
University National Bank has $258 million in assets. Roughly 7 percent of its assets are leveraged, high enough to merit concern from city staff and an outside consultant. De La Fuente has proposed triggers that would go into effect if the bank’s debt becomes too high.
The bank has had experience handling 3.5 million debit cards as of this year.
The cards are estimated to cost holders $15 each, and the vendor estimates that the city will issue 30,000 cards in the first year.