New Hanover Community Endowment officials on Tuesday outlined a new approach to how they plan to allocate its grants starting next year.
 
The shifts include grouping the grants into formalized categories of different scopes, offering unrestricted grants to some nonprofits and researching potential solutions on issues to shape requests for proposals that groups respond to, the endowment’s president and CEO Dan Winslow said during the organization's semi-annual public meeting.
 
The fund, created from the sale of county-owned New Hanover Regional Medical Center to Novant Health in 2021, now sits at about $1.6 billion.
 
About $100 million has been distributed to 170 recipients since grants started being disbursed in 2022, officials said.
 
The grant process will lump the endowment’s strategic and responsive grants – which are awarded throughout the year – into investment categories, Winslow said to the audience of more than 200 gathered at The Harrelson Center. Those categories are:
 
     • Community grants: grants up to $5,000 sourced and recommended by the Community Advisory Council (CAC) and others;
     • Capacity grants: grants for fiscal sponsors and innovation development;
     • Project grants: one-time grants for a project or event;
     • Operations grants: investment in established non-profits to boost outcomes;
     • Strategic grants: three-to-five-year investments in pillar solutions; and
     • Social impact investing: partnerships in major social problem-solving investments.
 
Also next year, there will be the opportunity for nonprofits to receive funding to build out their operations and capacity instead of being awarded money for a specific project or initiative.
 
“We have almost 2,000 nonprofits here in New Hanover County,” Winslow said. “About 150 of them are established nonprofits that are aligned with our pillars. We’re going to be looking at the beginning of next year – we’ll start probably with 50 or 60 or 70, just to start off with – we’re going to be looking for the established, well-run nonprofits that are aligned with the pillars of our endowment (and) the objectives that we’re trying to advance, who are doing a great job in this community and simply say, ‘Here is unrestricted operating money in Q1 or Q2.’”
 
Qualifying grants are required to address one of four areas, or pillars, in the county – education, health and social equity, public safety and community development.

Some of the questions from the in-person audience members or submitted online included whether grants could benefit work outside the county, how endowment funds might address improving patient care at Novant Health NHRMC, what happens when residents don't agree with major projects requesting funds and how to mitigate bias in the board's approval process.
 
In the initial funding cycles, the endowment was limited under its bylaws to allocating up to 4 percent of its assets’ fair market value each year. But it can, and has fallen, under that as the organization has ramped up. In 2028, the endowment will fall under private foundations status, Winslow said, meaning that according to IRS requirements, it will have to allocate 5% or more of the fund’s value every year or potentially face an excise tax penalty.
 
“If we were to apply that 5% number now that would be $85 million,” Winslow said. “So, by the time we get to 2028, it’s going to be close to and then shortly after that over $100 million a year. Every year we must, by law, reinvest in this community. That’s the opportunity.”

The video of the meeting will be posted on the endowment's website, and officials pledged to post answers to questions submitted from the public there.
 
Winslow will speak at the Business Journal’s Power Breakfast event Wednesday morning. Read more about the endowment’s upcoming plans in the Business Journal’s coverage of the event in our Daily Update newsletter.