Urbana's Own Money?

As the Great Depression continued to spiral out of control in 1933, it's effects pressed harder and harder on Urbana. Already in January, 1932, all of the banks in town closed on a "bank holiday" and only reopened when the majority of depositors agreed to keep their money in the them. Only a year later, the banks were again under intense pressure, and after several banks in Chicago closed their doors, another run on the banks loomed.

Both the Federal and State governments ordered the banks to close during the first week of March. Businesses and private persons alike feared that Urbana banks were next, and city officials realized a run on the banks in Urbana was in the offing. Additionally, the various crises drastically reduced the amount of currency available locally, and businesses were unwilling or unable to extend credit to buyers, even for necessities like food.

And so, to keep the local economy going during the bank holiday, community leaders held an all-day meeting and decided on a novel approach: they would make their own money. Specifically, businesses and Urbana citizens would trade in their U.S. currency for Urbana certificates, which could then be used to make transactions.

The city appointed a Board of Trustees to oversee the money, and $10,000 of the Urbana currency was printed. This insured there was a sorely needed local reserve of Federal money, and allowed local economic transactions to keep moving while the banks were closed. Once the crisis passed and the banks reopened, certificate holders were able to redeem the Urbana funds for U.S. dollars.

So, yes: for about three weeks in March, 1933, Urbana printed its own money.