Testimony Re: Merger of Notwest and Wells Fargo Banks 

Mary Tittgerthal, President and CEO 

National Equity Fund, Inc. 

September I7,1998 

Good afternoon. My name is Mary Tingerthal and I am here to give 

testimony regarding the merger of Norwest Bank and Wells Fargo Bank. 

I am here as president and chief executive officer of the National Equity 

Fund, Inc., commonly referred to as NEF. In this position, I also am here 

speaking on behalf of the National Equity Fund’s parent organization, the 

Local Initiatives Support Corporation, commonly referred to as LISC. 

To understand the relationship of Not-west and Wells Fargo with LISC and 

NEF, let me first explain what LISC and NEF are. 
M. Tingerthal Testimony 

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LISC, the Local Initiatives Support Corporation, is the nation’s largest 

community development intermediary and is a certified Community 

Development Financial Institution. 

Since its founding 19 years ago, LISC has helped nearly 1,800 community 

development corporations in more than 100 cities, as well as rural 

communities across 39 states and Puerto Rico. ln this work, LISC has 

attracted support from almost 2,000 donors and investors - including 

Norwest and Wells Fargo. 

Through this support, LISC has raised $3.1 billion in grants, loans, and 

equity investments for community development corporations and leveraged 

an additional $3.5 billion in public and private support. These dollars have 

produced more than 80,000 affordable homes and nearly 12 million square 

feet of community facilities, commercial and industrial space. 
M. Tingerthal Testimony 

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These focused investments catalyzed the transformation of some of the most 

infamous neighborhoods in the country - extending from South Central 

Los Angeles to New York’s South BTOIIX - into decent and desirable places 

to live. Norwest and Wells Fargo have been instrumental in their support of 

LISC in bringing about revitalized neighborhoods in the cities where they 

operate. 

Both banks have been integral to the community development work of the 

National Equity Fund as well. NEF is the nation’s largest nonprofit 

syndicator of the federal government’s Low Income Housing Tax Credit 

program. NEF was founded in 1987 by the parent company, LISC. 

For 11 years now, NEF has utilized the Tax Credit program to stimulate 

investment in affordable housing developments built and owned by 

nonprofit organizations, including community development corporations. 
IV. Tingerthal Teshmony 

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To date, NEF has raised nearly $2.4 billion from more than 140 investors. 

This action has generated the development of an estimated 44,000 rental 

homes targeted for struggling families, individuals with special needs, the 

elderly, and the homeless. 

Because of their participation in the NEF investment program, Norwest and 

Wells Fargo have been key to helping provide housing for low income and 

special needs populations, and in bringing blighted neighborhoods back to 

life. 

I can point to Norwest and Wells Fargo being instrumental in community 

development because of their historical core contributions to LISC and 

investments in NEF, as well as their long-term active involvement in local 

communities’ working toward revitalization. “Financing” investments and 

providing the “people” leadership are two areas in which both banks excell. 
M. Tingerthal Testimony 

Norwest ~4. Wells Fargo Merge1 

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Within the banking industry, Norwest and Wells Fargo have provided 

resources to the field of community development, and together have 

invested millions of dollars in poor communities across the country. 

From 1989 through today in 1998, Norwest has invested $14,345,000 in 

LISC and NEF. This total includes $14,000,000 of NEFequity investments 

since 1990. This total also includes $345,000 in grants to LISC since 1989 

which have supported six local LISC programs (Minneapolis, Duluth, Las 

Vegas, Milwaukee, Phoenix, and St. Paul). 

From 1983 through today, Wells Fargo Bank has invested $120,162,700 in 

LISC and NEF. This total includes $117,200,000 of combined equity 

investments in NEF’s National Fund ($42,000,000) and California Fund 

($75,200,000) since 1987. This total also includes $2,962,700 of grants to 

LISC since 1983 which have supported seven local LISC programs (Bay 

Area, Houston, Las Vegas, Los Angeles, Phoenix, San Diego, and Puget 

Sound) as well as LISC’s National Rural program. 
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The financial support of Norwest and Wells Fargo over the years has been 

matched with the “people leadership” as bank executives serve on advisory 

committees in eight LISC local program areas and the Rural LISC program 

area. Here are a few examples that demonstrate their commitment to 

community development. 

l Both Norwest and Wells Fargo serve on the local advisory committee for 

the LISC Las Vegas, Nevada, office. This leadership is provided through 

bank executives Paul Kadavy, Nor-west Nevada president, and Sam 

Culotta, Jr., Wells Fargo’s vice president for community development. 

Both men also serve on the executive subcommittee and strategic 

planning subcommittee. Sam also serves on the Board of the North Las 

Vegas Neighborhood Housing Services. 

l Additional Norwest staff provide expertise to Las Vegas LISC by 

serving on the CDC capacity building subcommittee (Nancy 
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Hamilton, CRA officer) and the project review subcommittee (Rick 

Frank, commercial loan officer). 

l Norwest sponsored a $200,000 FHLB of San Francisco (Federal 

Home Loan Bank of San Francisco) Affordable Housing Program 

award to the East Las Vegas Community Outreach Corporation for 

the 40 homeownership unit Mi Casa En El Sol project. 

l Norwest also has issued a $1 million revolving construction loan 

letter of intent for the project and is expected to provide 

approximately $2.6 million in homebuyer permanent mortgages. 

Two Norwest staffers participate in the project marketing 

committee. 

l Wells Fargo Foundation provided $25,000 to Las Vegas LISC in its 

current fundraising campaign. Additionally, First Interstate Bank, 

which was purchased by Wells, provided $50,000 to Las Vegas LISC 

in a previous fundraising campaign. 
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l In Milwaukee, Wisconsin, J. Lamer Little, a Norwest bank regional 

president, has been a member of the local LISC advisory committee for 

over two years and serves as credit committee chairman. Lanny is active 

with NOHIM, an organization titled New Opportunities for Home 

Ownership in Milwaukee. This is a coalition of lenders and nonprofit 

home buyer counselor groups. 

l In Houston, Texas, Wells Fargo actively works with the LISC local 

program as the bank’s senior vice president, Effie Booker, is a member 

of the local advisory committee. 

l Community development in California has benefited from Wells Fargo’s 

“financial and people” leadership. 

l Since 1983, Wells Fargo has contributed a combined total of 

$1,446,000 in grants to LISC program areas in the Bay Area, Los 

Angeles, and San Diego. Since 1990, Wells Fargo’s investments in 
I 

M. Tingerthal Testimony 

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affordable housing through the California Equity Fund has totaled 

$75,200,000. 

l Executive vice president for corporate community development 

Karen Wegmann has been instrumental in leading Wells Fargo to 

make these major LISC grants and investments in community 

development. Similarly, Tim Hanlon, vice president of corporate 

community development and head of the foundation, also has been 

instrumental in providing support to LISC efforts. 

l Wells Fargo executives share their expertise through membership on 

local advisory committees of three LISC California program sites: 

vice president Mel Carriere is on the LISC San Francisco LAC; 

regional vice president Phyllis Klein is on the LISC Los Angeles 

LAC; and vice president for community development Robert Taylor 

is chair of the LISC San Diego LAC. 

l Mr. Taylor recently encouraged Wells Fargo to make a long-term 

$1 ,OOO,OOO zero percent loan (for the first 5 years; then a nominal 2% 

rate for the next 10 years) to the Phoenix LISC program. 
4 

M. Tingerthal Testimony 

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l In addition to Wells Fargo presence on these California LACs, and 

the Houston and Las Vegas LACs mentioned earlier, Wells Fargo 

executives also serve on LISC local advisory committees in the Puget 

Sound area and in Phoenix, as well as the Rural LISC program’s 

LAC. 

l Norwest has been a supporter of the LISC Duluth, l%uiesota, program 

since the program’s inception in 1997, having contributed to the 

program’s original assessment and then having been one of the first five 

program funders. 

Not-west has worked with LISC on the development of housing 

programs and neighborhood strategies. Currently, Norwest is serving 

on LISC’s Employer Assisted Home Ownership Task Force, and is 

working with LISC in developing a new Single Family Purchase 

Rehab Program. 

Also, Norwest has been involved with the Board of the Duluth 

Housing Trust Fund, Inc.; and has administered a locally held $4 
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million mortgage program that provides relaxed underwriting to help 

low income families gain home ownership (known as the CAMP 

program). 

l In addition to housing, Norwest also has administered two loan funds 

through Lutheran Social Services which provide low-interest loans 

and credit to low-income households or to those who are working to 

move from welfare-to-work. 

These are just a few examples of the active involvement Norwest and Wells 

Fargo have in LISC areas of community development. I hope this 

information is helpful, and I appreciate the opportunity to report on LISC 

and NEF’s relationship with these banks. 
NORWEST PUBLIC HEARING 

I want to thank the Board of Governors for the opportunity to speak today. Atlantis 

Community Incorporated is a twenty-three-old Colorado not for profit corporation 

providing services to people with disabilities in Metropolitan Denver and when necessary 

throughout Colorado. Atlantis’ services include: home health, housing, benefits advocacy, 

independent living skills training, basic education, and a home ownership counseling and 

education program. Atlantis is recognized nationally for its’ work in disability rights and 

for creating new and innovative programs. 

In nineteen ninety-two Atlantis Community Incorporated brought to Norwest Bank a 

unique concept that became the first home mortgage program for people with disabilities in 

America. In conjunction with Atlantis, Norwcst created the Disability Community Home 

Mortgage Program (DCHOP). The DCHOP home mortgage program for people with 

disabilities was the first to offer an opportunity to participate in the American Dream, 

home ownership. Norwest at 

Atlantis’ direction developed a program that accepts alternative incomes such as; Social 

Security, Food Stamps, Tax Credits, and more. Higher debt to income ratios play a large 

part in the success of the program as well as reduced closing costs and only a two percent 

down payment. 

The American Dream of owning your own home was just that, a dream for people with 

disabilities until Norwest introduced the DCHOP Program in nineteen ninety-three. Prior 

to the DCHOP Program people with disabilities and/or their families only choice was to 

rent an apartment or someone else’s home. That apartment or home was most likely 

inaccessible too. With a population that is eighty percent unemployed and living on a fixed 

income from Social Security of seven hundred dollars a month or less had little chance to 

even dream of home ownership. The DCHOP Program offers more than just a dream, it 

offers hut does not guarantee the reality of home ownership. People with disabilities still 

must qualify for home loans just as everyone else must. Norwest simply leveled the playing 

field. 

Nonvest’s hold move to create the Disability Community Home Ownership Program when 

no other lending institution had the courage to take the first step must he applauded. Had 

not, Norwest taken that step people with disabilities still today would be excluded from the 

American Dream. Those first steps designed a program that proved to people with 

disabilities coukl be home owners without high foreclosure rates and without high 

delinquency rates using alternative using alternative forms of credit. The DCHOP Program 

encouraged US Banks’ Disability Advantage Program because another lending institution 

had taken the initial risk. 
Norwest success with the DCHOP Program brought Fannie Mae to Denver to learn about 

and to study its’ workings. From that visit came Fannie Mae’s Home Choice Program, 

sixteen states, fifty-million -dollar pilot program modeled after the DCHOP Program. 

Fannie Mae’s pilot project and US Bank Disability Home Advantage Program validate 

Norwest’s wisdom in nineteen ninety-two. 

After live years of providing home ownership counseling and education to people with 

disabilities I have realized that these potential home buyers have the ability and the desire 

to be home owners. Atlantis’ Home Ownership Program aspires to increase awareness and 

availability of home ownership opportunities for people with disabilities. Atlantis’ 

commitment is to assist potential buyers in understanding the complex process by providing 

them with the information that along with their own determination will prepare them to 

become responsible home owners and improve their quality of life. My goal is to see people 

feel confident about the home buying process and comfortable as a homeowners armed with 

the knowledge and empowered to make important decisions to undertake the responsibility 

of home ownership. I personally believe in home ownership counseling/education partnered 

with the DCHOP Program Atlantis and Norwest have pioneered home ownership for 

individuals with disabilities. 

It is Atlantis’ hope that with the merger of Norwest and Wells Fargo that the commitment 

to the DCHOP Program not only continue but the size of the program increase to reflect 

the size of the merger. To date, Norwest has provided nine hundred and fifty-five 

mortgages to people with disabilities and/or families in Colorado valued in excess of sixtyfour million dollars. Norwest has made it possible for people with disabilities to dream the 

impossible dream... 

HOME OWNERSHIP!!! 
Chicanos Por La Causa, Inc. has had an extensive 

partnership with Wells Fargo Bank and Nor-west 

Bank. As a member of Nor-west Banks Minority 

Advisory Council, we have provided input and set 

top management on a number of key 

factors that affect our communities in Arizona. These 

include mortgages, affordable housing, small business 

lending, minority contracting/vendors. Our small 

business and SBA micro loan programs have received 
loan loss reserve funds from Nor-west Bank and Wells 

Fargo Bank, which has helped us lend over 

$2,000,000 to over 200 small businesses in Arizona_&- -If ti 

/ 

Nor-west’s $100,000 deposit and Wells Fargo’s 

$100,000 deposit in Chicanos Por La Causa, Inc.‘s 

Federal Credit Union has enabled us to lend over $1.7 

million to 1600 members of our Credit Union, most of 

which are first time borrowers and mono-lingual 

Spanish speaking. Nor-west’s and Wells Fargo’s 

investment in CPLC’s small business incubator has 
started the opportunity for small businesses in South 

Central Phoenix to access affordable work space. A 

second business incubator in Phoenix is under 

construction and a rural small business incubator will 

go to construction in Nogales, Arizona in early 1999. 

Other investments/grants have targeted our special 

events and organizational capacity building in 

Phoenix and Tucson. Our affordable housing 

programs in Somerton, Nogales, Tucson, South 

Tucson, Guadalupe and Phoenix have also benefited 
3 

via mortgages, write downs for closing cost, and funds 

to make housing affordable. Investment of Norwest 

jJ&L? cLVA/Q&Jk~~_ 

staff as board members on our organization and our 

subsidiary boards also contributes to a sound nonprofit sector. 

f 

Our expanding partnership with Wells Fargo 

Bank has also been rewarding and in many instances 

very creative and challenging. Our purchase of the 

Wells Fargo Branch in South Central Phoenix enabled 

-1ble our Federal Credit Union’s space , 
maintain Wells Fargo’s presence in the Grant Park 

area and provide small business incubator space for 

minority entrepreneurs. Wells Fargo bank’s 

investment of $1,250,000 at 0% interest for 5 years, 

with ten additional years at 2% is beyond the cutting 

edge. This investment expands our ability to lend to 

micro borrowers, creates a “venture capital pool”, a 

revolving line for new housing construction in 

Tucson(for our for-protit construction 

company/subsidiary) enables us to leverage $600,000 
to build a new office building in Tucson and pay off 

an office complex mortgage in a small rural town in 

southwest Arizona that leases office space to the State 

of Arizona. Funding of special projects and 

community celebrations has made Wells Fargo a new 

power in the Arizona bank market. Grants to 

organizations involved in small business lending, 

social work, and arts, round out a true concept of 

partnering in our communities, not just taking our 

deposits. We would point to their exemplary record, 
staff involvement and outreach on how community 

reinvestment is truly done in America. Management 

of both the institutions still need to work on board 

membership, upper level executives are still lacking 

s 

but through our on-going efforts these are problems 

we can solve together. Branching duplication can be 

solved through partnerships with non-profits to benefit 

the total community as was my first example with the 

Wells Fargo Branch in South Central Phoenix. Our 

community meetings with citizens, organizations and 
community leaders and the upcoming follow-up 

meetings statewide leaves us with very strong 

indicators that more progress will occur with the 

merged institution and we encourage your positive 

confirmation of this merger and invite you to visit and 

see community reinvestment at work in Arizona. 

Thank you.