MINNEAPOLIS -- Wells Fargo is narrowing its focus in philanthropy this year and pledging to boost funding for affordable housing by $1?billion through 2025.
The corporation announced this week that its Minnesota-based foundation will shift its focus nationwide to fund programs that work on affordable housing, financial health and growing small businesses instead of a broader set of goals.
"This is a big change for us to go really deep into really complex issues," Wells Fargo Foundation President Jon Campbell said. "It's a trend within philanthropy that you focus on fewer things ... go deeper on those fewer things and become an active participant in those things instead of just using your checkbook."
Minnesota, like the rest of the nation, faces a major shortage of affordable housing. Shelters are full, communities report low apartment vacancy rates and rents are rising statewide.
More than one in four households are cost-burdened, meaning they pay more than 30% of their income on housing. And earlier this year, a new report said the state's homeless population of more than 10,000 people had reached a record high number.
In response, local cities, counties and nonprofits are trying to build more affordable housing to combat its growing scarcity in the Twin Cities' and buy apartment buildings to preserve affordable units before they can be sold and converted into luxury units with higher rents.
"The challenge is the need is so great," said Chris Coleman, the former St. Paul mayor who now is the CEO of Twin Cities Habitat for Humanity. Habitat has received funding from Wells Fargo for 25 years, including nearly $1.3?million recently to support building 16 homes in five years. "It doesn't happen unless there are partners like Wells Fargo stepping up."
The announcement by Wells Fargo, which is headquartered in San Francisco and is the ninth-largest Minnesota employer, follows other corporations and organizations changing how they give.
This year, the Target Foundation announced it was revamping its funding priorities and Greater Twin Cities United Way narrowed its focus, eliminating some grant-making categories.
For the first time in recent history, Wells Fargo said it will donate 2% of its earnings after taxes starting this year.