The editorial board recommends voting no on San Francisco’s Proposition B, which would enable the first step in creating a city-run public bank.

San Francisco isn’t exactly a city known for the transparency or efficacy of its expenditures. The city has a $16.9 billion budget and no shortage of ways to get that money out the door — with decidedly mixed results.

And yet Proposition B, a City Charter amendment on the November ballot, would potentially launch an entirely new municipal entity to disperse taxpayer money.

The details are complex.

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Prop B would allow for the creation of a Municipal Finance Corp. — the first step toward starting a city-run public bank. It would be a nonprofit, non-depository institution able to provide or arrange financing for affordable housing, home ownership, small businesses, climate infrastructure and environmental-justice projects. After at least three years of operation — and only after securing state and federal regulatory approvals — it could then transition into a full public bank.

Governance would be divided among professional boards and a public oversight commission. The Board of Supervisors would appoint four of the initial nine Municipal Finance Corp. commissioners, the mayor would appoint two, while the treasurer, controller and city attorney would each appoint one.

Prop B provides no funding. The Controller’s Office, citing a 2023 working group viability report, estimated that the city would have to come up with $310 million to $460 million to establish, capitalize and operate a public bank.

That’s quite an outlay at a time of federal funding shortfalls and perennial budget insecurity.

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Some context is helpful. In 2019, California enacted Assembly Bill 857, the........

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