BOSTON/Government Center – When the City Council adjourned its meeting Wednesday afternoon, At-Large City Councilor Felix Arroyo was beaming. “I’m just grateful; it’s been a four year fight.”

The “fight” to which the councilor referred was the effort to pass a bill that significantly changes the way banks and other financial corporations are expected to do business in Boston. Officially, an ordinance “Amending the Municipal Banking Commission and Providing for Responsible Banking Practices,” the measure requires banks looking to win contracts with the city to prove they are investing in local residential and commercial development and social and cultural institutions.

The primary goal, say supporters, is to encourage banks to take an active role in improving Boston’s neighborhoods. The biggest prize for those institutions with the best record of community investing is the one billion dollars the city deposits annually.

The ordinance establishes a nine member commission whose task it is to evaluate financial institutions and rank them based on information provided to the City’s Treasurer on such things as residential lending, numbers of foreclosures vs. mortgage loan modifications, small business lending, and community development investments.

Passed unanimously by the Council on September 18th, the “Invest In Boston” ordinance – as it is referred to by supporters – was vetoed by Mayor Menino about two weeks later. Subsequently, he submitted to the Council a far less comprehensive version of the ordinance.

The Mayor, in a letter to the Council that accompanied his veto, said his administration doesn’t believe the ordinance will result in meaningful changes to current business practices. Those practices include no-fault home foreclosures and a dearth of investments in local small businesses and not for profit social and cultural institutions. Menino also fears, he said, that the cost of doing financial business for the city will rise as banks pass along the extra cost of the ordinance’s reporting requirements.

Arroyo and nine others on the Council, countered that Boston now joins other major cities – such as New York and Los Angeles – with responsible banking laws on the books. And that banks doing business with the city must now take an active role improving Boston’s neighborhoods.

Wednesday, by a vote of 10 to 3, the Council overrode the Mayor’s veto. Two of the three dissenters, Michael Ross and Council President Stephen Murphy, expressed concern over the Council’s parliamentary process: the Mayor’s proposed bill had not been sent to committee for review and public hearings, they argued. Salvatore Lamattina also voted against the override.

Earlier in the meeting, Murphy offered a motion to vote on sending both Councilor Arroyo’s original ordinance and the Mayor’s revisions to the Committee on Government Operations. Following a recess and an animated conversation between Murphy, Arroyo, and several other members, the council voted 10 to 3 to defeat the motion.

Arroyo - who placed fifth in the recent preliminary election for Mayor and will be leaving the Council when his term ends later this year – considers the Invest In Boston initiative one of his signature accomplishments. Following the meeting, an elated Arroyo said he disagreed with the motion to send the bill to committee because “we’ve had many hearings on Invest in Boston already. It shouldn’t take four years to vet.”

But there have been suggestions the measure is largely symbolic. The bank with the largest holdings of city deposits – 70 percent - RBS Citizens Financial Group and its local Citizens Bank – has a pretty good community investing track record. Federal regulators have called the bank’s community service “superior.”

In a statement provided by the Citizens Bank media relations department, the bank says, “We have experience working with similar ordinances in other cities and also frequently provide this kind of information to our Government Banking clients through the [request for proposal] process. We believe strongly in the importance of supporting local communities and consider ourselves fortunate to be able to work with so many great community partners across Boston. We are making significant investments in Boston and other Massachusetts communities as part of our recent commitment to provide $1 billion for community development initiatives across our footprint over the next five years.”

Still, activists and supporters welcomed the Council’s favorable vote. Steve Meacham, Lead Organizer for the Jamaica Plain-based City Life/Vida Urbana housing advocacy organization, said the ordinance sets a dynamic precedent that “cities can use social justice criteria to set financial policy.”

[story updated 11.4.2013 to include statements from Mayor Tom Menino and RBS Citizens Financial Group]