The City of Berkeley is one of the liberal cities in United States of America, which is struggling because of the financial woes. Berkeley is also known for being a Sanctuary city that allow migrants to access city’s resources and be safe. However, with recent change in the Federal policies which include budget cuts for sanctuary cities could bring darker clouds for the City of Berkeley.
Also, as Berkeley is home to San Francisco’s tech giants, large housing demand & premium price is but obvious. Adding to misery of low income groups is that developers are concentrating on wealthier section of the society. All this has compounded into a housing crisis for low income groups.
Last year the city counted nearly 1000 homeless people which is 17% higher than 2015 count and 43% more than 2009 count. As per analysis by a consultant and public accounting firm Novogradac & Company, the crisis can lead to shortage of 235,000 homes over next 10 years.
Blockchain to Help California for Housing
The City of Berkeley is considering launching an Initial Coin Offering (ICO) as against conventional method of only selling Municipal Bonds to finance infra projects. The ICO would raise funds by selling digital coins that would be backed by government Municipal bonds.
Post the announcement, Councilor ‘Ben Barlett’, stated, “It’s actually enabling us to fulfil our duty as a government. Our duty is to provide for our people. It’s a violation of that duty to allow people to sleep in the streets.”
Barlett further added that, “We have a jobs explosion and a super tight housing crunch. You're looking at a disaster. We thought we'd pull together the experts and find a way to finance ourselves.”
Whilst the project is in the planning phase, Councilors in Berkeley have partnered with the City Mayor ‘Jesse Arreguin’, Financial Technology startup called Neighborly and Berkeley’s UC Blockchain Laboratory to develop the technology and the platform for the ICO.
The exploratory committee behind the ICO will announce the full deal terms this spring. Right now, the proposed scheme requires democratic approval from councilors. We can expect the proposed scheme becoming a reality in May 2018.
By leveraging the Blockchain technology, Berkeley would become the first city in the USA to use ICO as a crowdfunding tool to raise funds for affordable housing and support services for the city’s growing homeless population.