NOVEMBER1996
Philanthropy Journal of North Carolina
7
Melvin
Continued from page 6
The land will be used to expand
Bryan Park, named for the Triad phi
lanthropist who died last year at 99.
Melvin, who was one of Bryan’s clos
est friends, got the idea to purchase
the land when he drove by and
noticed a “for sale” sign posted there
last year.
The land purchase is the Bryan
foundation’s largest gift to date.
Other gifts include $500,000 for a new
golf practice area at Bryan Park and
$500,000 for renovations to Bryan’s
Irving Park home for use by the chan
cellor of the University of North
Carolina at Greensboro.
Melvin, 62, will take early retire
ment Dec. 31 from his job as Guilford
County executive for Central
CaroUna Bank and will begin working
for the new foundation January 1.
“I don’t look at it as a retirement,”
he says. “I view it as a brand new
exciting occupation.”
The foundation will not be fully
endowed until Bryan’s estate is set
tled. Court records put his weath at
about $64 million.
Melvin, who served as co-executor
of Bryan’s estate, says the new foun
dation will make grants of about $3
million annually. In keeping with
Bryan’s giving style, no applications
will be taken; Instead, grants vGU be
made in response to perceived needs
in the community
“If you look at his giving, most of it
Jim Melvin
was self-directed rather than
requested,” says Melvin. “He had a
great interest in
innovation and
entrepreneurial
types of things.”
When the $64
million from
Bryan’s estate is
transferred, the
new foundation
will become one of
the 15 largest in
the state. By com
parison, the Greensboro-based
Kathleen Price Bryan Famfly Fund -
which was set up by Bryan’s late wife
- has assets of $50 million.
Melvin, who served as Greensboro
mayor from 1971 to 1981, cites his
long tenure in the Triad as one of the
advantages he will bring to his new
role as foundation executive.
“Fve been living in this community
for about 60 years,” he says. “I’ve also
had the opportunity to be with Mr.
Bryan and understand what he was
all about.
“One time, years ago when I was
mayor, the federal government cut
back on a summer jobs program. Mr.
Bryan called me up on the phone and
gave $100,000 right then because he
didn’t want kids not to have opportu
nities over the summer.”
Melvin has been meeting with
nonprofit leaders such as William
Friday, executive director of the
William R. Kenan Jr. Charitable Trust
in Chapel Hill, and Tom Lambeth,
executive director of the Z. Smith
Reynolds Foundation in Winston-
Salem, to discuss the direction of the
new Bryan foundation. And he plans
to visit other U.S. foundations with a
reputation for innovation.
Melvin says he will rely heavily on
the foundation’s new board, which
includes a number of well-known
community leaders appointed by
Bryan, including developer Mike
Weaver, attorney Carole Bruce and
television executive Shirley Frye.
Greensboro newspapers report
that Melvin has received $132,529
from Bryan’s will in his role as co
executor of the estate. His salary as
foundation president has not yet been
determined.
Greensboro foundation leaders
say the infusion of new grantmaking
dollars Is coming at a time when com
munity needs are increasing.
“We are very excited about this for
a couple of reasons,” says Worth
Durgin, who heads the Foundation for
Greater Greensboro. “Even if you
combine the grantmaking of the Joe
Bryan [foundation] and Wesley Long
[a foundation that could result from
the merger of two local hospitals],
you’re looking at about $5.5 million of
new philanthropic money a year.
That’s fantastic, but it’s a long way
from what the need is. We will all be
working together coUaboratively And
all of us will be better off for it.”
Melvin hopes the new foun
dation win remain true to Bryan’s
big-picture approach to philanthropy
“We want to keep it simple and not
build up a lot of bureaucracy,” he
says.
Merrill Lynch
Continued from page 6
grants of more than $652 million to
U.S. nonprofits.
Throu^ its sales force of financial
consultants, Merrill Lynch will help
educate donors about the benefits of
contributing to community founda
tions as they plan their current and
future charitable gifts. The company
will collect fees for managing funds
that clients place with community
foundations, but the foundations
themselves will pay no fees to Merrill
Lynch.
“This alliance allows us to meet
our clients needs and, I think, meet
needs that community foundations
are facing in local communities,”
Singleton says.
North Carolina foundation offi
cials agree.
“This [alliance] is a way for the
community to preserve its philan
thropic resources,” says Fred Stang,
development officer for the Triangle
Community Foundation. “It brings
into play the skills that a community
foundation can bring to bear, as well
as the skflls that an Investment firm
such as Merrill Lynch can bring to
bear. It ends up being a triple-win sit
uation” - for the donors, the founda
tion and the investment company.
Worth Durgin, who heads the
Foundation for Greater Greensboro,
says his community foundation has
received about $1 million in new
donations as a result of the Merrill
Lynch alliance. The foundation -
working throu^ the state association
of community foundations - also has
developed a standard agreement that
can be used by other community foun
dations that want to build relation
ships with financial services compa
nies.
“One of the challenges our founda
tion now has is that in addition to our
main portfolio, we also have relation
ships with five or sk different organi
zations” that have set up funds,
Durgin says. “On a real functional
level, it does get complicated. So the
benefit of offering donors and organi
zations investment alternatives [such
as Merrill Lynch’s program] is a
necessity.”
To date, Merrill Lynch clients have
transferred almost $2.5 billion to non
profit organizations. Overall, the com
pany manages $756 billion in client
assets.
Singleton hopes that MerrUl Lynch
will eventually have investment
agreements with all 400 U.S. commu
nity foundations.
“This is a new concept for commu
nity foundations for a firm like Merrill
Lynch to assist them,” he says. “The
foundations in North Carolina have
embraced this more so as a total
group than we’ve had in any other
state, with the exception of Ohio.
They are clearly at the cutting edge of
understanding the needs of individu
als.”
For information about the
alliance, call Singleton at Merrill
Lynch’s Philanthropic Advisory
Services office in New Jersey,
(609) 282-1370.
Hospitals
Continued from page 6
at a news conference announcing the
merger. “Both not-for-profit, commu
nity-based systems are increasingly
focused on improving the health of
the entire community - an effort that
will be greatly enhanced by the for
mation of the new foundation.”
Lanty Smith, chairman of the
board of Moses Cone Health System -
which includes Moses Cone Memorial
Hospital and Women’s Hospital of
Greensboro - says the foundation rep
resents an ongoing commitment to
more responsive health care.
“This [new foundation] is more
pro-actively trying to address com
munity he^th issues - issues such as
access and preventive care,” he says.
The boards of the two hospitals
voted September 16 to merge, citing
cost savings they could achieve as a
consolidated health system. Since
then, hospital officials have launched
a study to further detail those cost
savings and will file an application
with federal authorities, who must
decide whether the proposed merger
violates anti-trust laws. The study is
expected to be finished by January 1.
The proposed foundation is not
the first in North Carolina to be
formed as the result of the sale or
merger of a nonprofit hospital.
A $115 million-asset foundation
was formed in the wake of the 1995
sale of two nonprofit hospitals run by
The Sisters of Mercy in Charlotte to
the Charlotte-Mecklenburg Hospital
Authority. And a $30 million-asset
foundation was formed after this
year’s sale of Cape Fear Memorial
Hospital in Wilmington to the for-
profit Columbia/HCA hospital chain.
Throu^out the U.S., similar foun
dations are being created as more
hospitals seek to mei^e or are sold to
for-profit businesses. Federal law
requires that the assets of nonprofits
he given to charity if their status
changes.
Nationally, the number of those
transactions is increasing as the
health-care industry becomes more
competitive. Studies show that the
number of mergers or acquisitions
among U.S. hospitals rose from 60 in
the early 1990s to 674 in 1994 alone.
But in North Carolina, hospital
mergers are still relatively rare, says
Roberts Fitzgerald, assistant director
of the state Division of Facilities
Services, which grants certificates to
health-care organizations for merg
ers or partnerships.
“We don’t have much of a history
of this,” he says. “The only time this
has gone on here recently - where
there have been two facilities in the
same community that have done this
- is a year ago in Asheville,” when St.
Joseph’s and Memorial Mission
Hospitals set up a partnership
arrangement to provide joint health
programs.
Funds for the new health-care
foundation in Greensboro will come
from an endowment resulting from
the sale of Wesley Long’s shares in
PHP Inc. - a for-profit health mainte
nance organization. Hospital officials
say Wesley Long made about $45 mil
lion in the stock sale and will add $5
million from its cash reserve to make
up the $50 million total.
If the merger is approved, grants
from the new foundation would be
made beginning in 1997 to health pro
grams in Guilford, Rockingham,
Randolph and Alamance counties.
Specific areas of interest would
include efforts to improve health and
parental education, prenatal and
postpartum care for women and
health care for low-income adults.
Officials at the two hospitals say a
15-raemher board for the new founda
tion will be named later this year.
Seven members will come from each
hospital and Wesley Long will appoint
the foundation board chair.
Other North Carolina health-care
funders are still trying to figure out
how the new foundation will affect
their grantmaking.
“It’s too early to determine what it
will mean,” says John Frank, director
of the Healthcare Division of the
Kate. B. Reynolds Charitable Trust -
the state’s second-largest health-care
funder. “We get a lot of requests from
the Greensboro area and we’ve fund
ed a lot of things there. That may
change in time. But until the founda
tion is set up. I’m not sure we know or
they really know”
Worth Durgin, head of the
Foundation for Greater Greensboro,
notes that in addition to the new hos
pital foundation, the Cemala
Foundation and the Joseph Bryan
Fhmily Foundation have also set up
grantmaking shop in the Triad in the
past two years.
“For a community of our size,
these are enormous developments
and wonderful developments,”
Durgin says. “What we’re probably
going to see is our continuing to make
grants the way that we have, with the
awareness of the new funding that’s
going on.”
There are other implications of
the hospital merger that remain
unclear, including how many staff
positions may be lost or what
changes might be made in health
care services now offered by Moses
Cone and Wesley Long.
Leaders of some of the community
health programs that have been
launched recently by Moses Cone say
they expect their work will continue
under a consohdated system.
For example, a $100,000
Community Health Improvement
Fund that Moses Cone created earlier
this year is now considering grant
proposals for programs to meet
pressing health-care needs.
“We’re right in the middle of the
process,” says Kelley Roberts of the
Greensboro United Way - the agency
Special Issue: Special Events
The December 1996 issue of the Journal is a
special issue focusing on special events. Stories will include the
pros and cons of special events, planning and execution and a list
of nonprofit facilities.
For advertising Information
call Marguerite LeBlanc at (919) 899-3741.
that is coordinating the fund’s grant
making. ”We have $100,000 to allocate
and it’s quite a task. I have not heard
anything contrary to this being an
ongoing program.”
Even without the addition of a
new foundation, mergers such as the
one proposed between Wesley Long
and Moses Cone can be a positive
development for North Carolina com
munities, experts say.
“They have the potential for mak
ing our health-care delivery system a
little more rational and saving some
money,” says Ellen MacMillan, of the
state Hospital Association. ‘At the
same time, they will create larger sys-
tems that can take care of people
from wellness through chronic or ter
minal illness. “
Smith, the board chairman of
Moses Cone, believes the proposed
merger could become an example of
how to preserve nonprofit hospitals.
“I tMnk we have an opportunity in
Greensboro to be a model for the rest
of the country as to how this kind of
consoUdation should occur and how
community health should be empha
sized and addressed,” he says. “I
beUeve a decade from now we will
look back and say that Greensboro
has something really quite unique.”
Douglas J. Lewis, CFP
Certified Financiai Planner
National Alliance of RENAISSANCE Associates
Specializing in Charitable Tax Planning
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