A $1.25 Billion Bet

There were three men on the stage at March’s Greater Wilmington Business Journal Power Breakfast, but only one the crowd really wanted to see: William Buster, the newly hired president and CEO of the $1.25 billion New Hanover Community Endowment. 

The moment Buster accepted the position in January 2022, he became the most sought-after man in the Port City, which is why he was sitting centerstage only a few days after starting his new job. He hadn’t even unpacked his car yet, Buster joked.

Wilmington had waited a year to see who would lead the endowment that the February 2021 sale of the county-owned New Hanover Regional Medical Center to Novant Health created. The New Hanover Community Endowment, according to its bylaws, will focus on four main areas: education, health, safety, and economic opportunity. In North Carolina, only the $3.8 billion Duke Endowment is bigger when it comes to philanthropic organizations.

But what makes New Hanover’s endowment unique is that it is bound by the county line. Unlike the Duke funds, which serve both North and South Carolina, the New Hanover Community Endowment must use up to 4 percent of its total market value for annual philanthropic giving within New Hanover County limits. That means about $52 million per year will soon be flowing into one of North Carolina’s tiniest counties.

The influx of money has created quite a bit of anticipation for how it might be spent. Locals see the wealth as a potential panacea for everything from housing shortages to community violence to infrastructure failings. One of the first questions the crowd of local politicians, business leaders, and nonprofit directors asked at the March 2022 event was if the endowment would fund a replacement for the Cape Fear Memorial bridge, the two-tower vertical lift bridge over the river that is in dire need of replacement.

“What is it?” Buster asked, before quickly saying no.

He didn’t come to the coast to chip away at aging infrastructure. Buster came to make a seismic change on issues like poverty and health. But as experts point out, the endowment speaks to key questions about philanthropy's role in society.

“Are foundations truly able to change the economic, social, and political structures that organize society?” wrote Dr. Doug Easterling, a Wake Forest University health policy professor, in a study of 33 health foundations. “Is this truly a leverage point that is available to foundations? And is this a legitimate strategic direction for foundations to take?”

Buster is down to find out.

New Hanover Regional Medical Center in Wilmington was sold to Novant Health in February 2021. The sale created the $1.25 billion New Hanover Community Endowment.

New Hanover Regional Medical Center in Wilmington was sold to Novant Health in February 2021.

A Region Transformed

New Hanover County is a sliver of land on the southern end of the North Carolina coast at the mouth of the Cape Fear. The river borders it to the west, and the Atlantic Ocean on the east. Beyond Wilmington’s downtown, most of the county is suburban sprawl leading to three beach towns and two rural, unincorporated sections in the north and south.

After the Civil War, Wilmington was North Carolina’s largest city. It grew into a mixed-race community with a thriving Black middle class, before an 1898 coup orchestrated by white politicians, newspaper publishers, and citizens destroyed it. Many Black residents fled the city after the coup, and white residents claimed their property, creating deep chasms between the races that still linger 120 years later. Today, 82 percent of New Hanover County residents are white. Black residents make up only 13 percent of the county, and Latino residents nearly 6 percent. 

The county’s poverty is segregated and concentrated, for the most part, in downtown Wilmington, according to 2020 Census data. These neighborhoods are predominantly Black. New Hanover County’s poverty rate is about 10 percent, but among Black residents, it’s just over 33 percent. 

New Hanover County Schools are also segregated, with white students concentrated in the county’s better-performing schools, according to state test scores. Black students in New Hanover County averaged three grades behind white students, a 2018 ProPublica investigation found. This disparity ripples into the job market, where non-white New Hanover residents, particularly women, earn significantly less than their white counterparts.

While it is the state’s second-smallest county by land area, New Hanover has one of the fastest-growing populations. New residents are numbering 10,000 per year—a growth rate of about 1.5 percent annually, higher than North Carolina’s overall growth rate.. Many of them are northerners fleeing cold winters and high taxes.

This influx of new residents, coupled with an economy founded on beach tourism, has created a tale of two cities. One is made up of predominantly white, rich, suburban business- and homeowners. The other is the Black and Latino community in the city’s north, south, and east sides. At the same time, gentrification is squeezing low-income residents in those neighborhoods into the unincorporated rural areas. Homeownership is increasingly out of reach for many Black and Latino residents.

While most American communities face similar issues, few have $52 million dollars a year to address them. The endowment’s areas of focus overlap with the county’s largest pain points.

How exactly it addresses those pain points falls to Buster, a North Carolina native with two decades of experience and a front row seat to several philanthropic efforts across the state. 

A Double Agent

Buster’s story starts on a farm in Rowan County.

He grew up in Kannapolis, a mill town where everyone was poor, he said. The “rich kids” there might have been the children of the plant manager, which wouldn’t make them rich anywhere else.

“The wealthy people lived in Concord, and we hated Concord,” he said.

Buster, now 51, spent a lot of time on a farm his grandmother owned. Mary Parks Lipe cut her own path through life. She divorced her husband soon after Buster’s father was born and moved from Florida back to the family farm in North Carolina.

She was proud of the fact that she owned the land.

She had no qualms about telling a sheriff’s deputy to stay off her porch, or confronting her neighbors when her property was stolen from her front lawn, even though they were known members of the Ku Klux Klan. 

“My grandma, man, you know, she didn't take no shit,” Buster said. “As long as you treated her with respect, she treated you with respect.”

When Buster talks about his grandmother, a smile creases his lips. His face brightens and his voice tinges with pride, especially when he explains her core values that he has adopted.

“One, you're not afraid of anyone,” he said. “Two, you treat everybody with respect. Three, family is the core of everything.”

Lipe was instrumental in Buster’s development, though he didn’t know it at the time. After high school, he started as a football player at a small private liberal arts university. But he disagreed with his coaches on why he was there; football wasn’t Buster’s priority. 

Buster transferred to North Carolina Agricultural and Technical State University, now the country’s largest historically Black university. In Greensboro, he joined a group of community activists working on school redistricting and community programs in underserved neighborhoods. That work earned Buster a reputation, and Dr. Ridgely Mu’min, an A&T professor of agricultural economics, recruited him to work on land issues with Black farmers. 

Farmers told Buster stories about how they’d turn in a loan application, only to watch the banker take it from their hand and put it in the trash can. His work gathering these stories in North Carolina, South Carolina, and Virginia eventually led to the 1997 class-action lawsuit Pigford v. Glickman, filed in the U.S. District Court for the District of Columbia against Clinton-era Agriculture Secretary Dan Glickman. The suit argued the USDA had denied Black farmers loans and debt restructuring, forcing many into foreclosure. The lawsuit was eventually settled, with payouts of up to $50,000 per farmer.

During a visit home to Rowan County, Buster’s grandmother asked him about his work. He told her about the Black farmers, which brought a smile to her face.

“I always wondered who was going to get bitten by the bug,” she told him. “I’m proud of you.”

That was it for Buster. He’d found his life’s work.

Buster graduated from A&T in 1996 with a degree in history. He was interested in African nationalist movements and southern history and spent time after graduation studying in Ghana. He was considering pursuing a doctorate when the Winston-Salem-based Mary Reynolds Babcock Foundation recruited him for a job as a rural program officer focused on the South. 

Buster wasn’t sure he was going to take the job until he spoke to one of the farmers he’d worked with during the Pigford lawsuit. The farmer told him he could make sure those who needed the money most got it.

“I've been given an assignment,” Buster said. “I'm a double agent. That was my sole reason for taking that job. I'm going to bust this up and give money to the folks who deserve it.”

Buster spent seven years working with farmers and rural communities, time that he said showed him how lived experience should inform grant-making. 

“I could walk into any room in Jackson, Mississippi, or Little Rock,” Buster said. “I'm doing things for folks that I know would never get in those rooms. I'm bringing a perspective into a room that had never been brought before.”

He went on to the childhood development and health-focused W.K. Kellogg Foundation, starting as a program officer before being promoted to director of Mississippi and New Orleans. He ended as a special adviser to the foundation’s president, focused on young men and boys of color.

Kellogg is the seventh-largest foundation in the U.S.;  it was a lesson in managing and deploying vast sums of money. He also saw that decision-makers at the national level often didn’t have any sense of what was happening on the ground. 

His next job, as executive vice president of community investments at St. David's Foundation in Texas, helped him put all that together. 

Operating on proceeds from St. David’s HealthCare, the foundation aims to make the five-county area around Austin the world’s healthiest community. Like the New Hanover Community Endowment, it is focused on a single geographic area. 

Buster points to the time as his coming of age as a leader under the mentorship of Earl Maxwell. Maxwell had grown the foundation into one of the 10 largest in the nation and everyone in Texas knew Maxwell. But Buster remembers him as humble, never losing sight of who he served. 

“St. David’s was an excellent place to learn how to lead a very sophisticated organization,” Buster said. “You really can't be a human being and have access to millions, billions of dollars and not be fazed by it all.”

It was also his last stop before returning home, to serve as the senior vice president for impact for the Dogwood Health Trust in 2020. The Asheville-based foundation, created in 2018 when Mission Health sold to HCA Healthcare, was off to a rocky start. 

“It was a mess,” he said. “They just did it wrong. They didn't listen.”

The February 2021 sale of Novant Health created the $1.25 billion New Hanover Community Endowment.

The February 2021 sale of Novant Health created the $1.25 billion New Hanover Community Endowment.

Learning From Stumbles

The $1.1 billion Dogwood Health Trust is working on improving the well-being of 18 counties in western North Carolina, with a focus on housing, employment, education, and health. 

But Dogwood stumbled from the start, as multiple sources The Assembly spoke to acknowledged.

“They took a showy approach,” said one nonprofit professional familiar with the Dogwood launch who asked to speak anonymously to be more candid. “They talked about how they’d dramatically improve the region.”

The highly publicized search for a CEO didn’t help. Antony Chiang beat out 125 candidates to become Dogwood’s first chief executive, but many in the area met his lack of local roots with skepticism. The foundation fell short of its goal of allocating $50 million in grants, and Chiang left less than a year later. 

Susan Mims was named the interim and later permanent CEO, bringing Buster on to take over Dogwood’s grant-making and program-related investment strategies. Buster attributes Dogwood’s early missteps to a lack of experience, but also a failure to learn what the community wanted. The region had never seen that amount of resources before. Instead of seeking advice and input, Dogwood’s leaders had tried to figure it out on their own.

Easterling, the Wake Forest health policy professor, largely agrees. “I would not be the first to say that they were naive in terms of what they understood it took to make smart investments at that scale.”

Under Buster’s leadership, Dogwood held more than 30 listening sessions and established an operation structure to improve allocations. Colleagues there described Buster as an “empathetic leader” who is impossible to replace. Mims said Buster, despite his short tenure, left his mark: “I have no doubt William will continue to bring that same emphasis and approach to the New Hanover Community Endowment."

But others in the philanthropic world flagged his departure as a sign of ongoing trouble at Dogwood; several other Black employees have left over the last year because they felt undervalued, and didn't think the organization’s internal culture has lived up to its public rhetoric on equity.

Which brings us to Buster’s arrival in New Hanover this March. Philanthropy is an industry, so when New Hanover announced its plans, everyone was watching who would be tapped to guide it. New Hanover Endowment Vice-Chair Hannah Gage said Buster’s talent and experience made him the right fit. 

“He spent most of his life doing foundation work, and he understands strategic grantmaking,” said Gage. “That's the type of grantmaking our board is interested in making: investments in the community that really do change the trajectory of people's lives.”

This is a chance to really make a difference, Buster said. He has friends at other foundations who have far more resources, but can’t tell if they are actually making a difference.

“The people who get into philanthropy do want to change something,” he said. “There's not another community where you have 200,000 people and we're going to be putting out anywhere between $30 to $50 million a year. That’s the kind of stuff that people live for in this work.”

‘We're Going To Solve A Lot Of Problems With This Money’

Before its sale to Novant Health in October 2020, New Hanover Regional Medical Center was the largest county-owned hospital in North Carolina. The $2 billion sale was approved in January 2021.

County leaders first proposed selling the medical center in 2019, hoping to capitalize on strong finances. The hospital was operating in the black because of a mixed patient population of Medicare recipients and a smaller pool of uninsured patients, but hospital leaders feared changes in insurance and regulations would cut into cash flow.

Before the sale, New Hanover County created a 24-member advisory group to determine if selling the hospital was the best course of action. The advisory group recommended the sale. Since the hospital was county-owned, creating the endowment to safeguard the proceeds and remove them from the regular budget cycle, which is susceptible to the politics of the day.

Under the deal New Hanover County commissioners and the hospital’s trustees reached, the endowment is an independent organization with a 13-member board appointed by the county and Novant. The structure is designed to reduce the chance elected officials could dip into it for pet projects.

“The endowment was envisioned to be a way for the county to take the equity out of the hospital and keep it in the county,” Jason Thompson, a former county commissioner who served on the advisory group, told The Assembly. “The principle should be sacred. And politics should be out of it. We don't want this to become a piggy bank for special interests.”

The endowment’s focus on health, equity, education, and safety means that, if it is effective, New Hanover County should have the best schools, the best parks, and the strongest economy, Thompson said.

“We are going to be one of the richest counties in the country with our own private endowment that can only be used inside our tiny little border,” Thompson said. “We're going to solve a lot of problems with this money.”

Johanna Anderson, executive director of the Charlotte-based Belk Foundation, who will step down later this month, was excited when she heard about the endowment’s creation. 

“I’m a big believer in the unique and additive role philanthropy can play in the community,” she said. “Doling out big checks is an important part of their job, but it certainly isn’t the only part. The assets are incredible. The dollars are very valuable. But it really matters how they interact with the community.”

Anderson said the endowment can be more innovative and take more risks than government or for-profit business, and set an agenda for where New Hanover County is headed without political pressure.

“It is a big responsibility,” Anderson said. “I don’t know William Buster well, but I do know he is committed to this process. If they can bring other philanthropic assets into the community that can be a mark of success. Sometimes these foundations invest in research and data that has value for other communities.”

Buster has been busy taking meetings with community leaders, launching a series of information sessions, and establishing a community advisory board to consult on programming to galvanize the community around the endowment’s priorities.

“I want to keep reminding people that I may be able to bring a big checkbook to the table,” Buster said. “But I've seen money wasted in communities because people didn't know how to work together.”

While the potential for impact in a tiny county is huge, it also creates limits. Few, if any, New Hanover nonprofits are set up to handle a massive influx of funds, a fact Buster talked about during the March event.

“If you're not used to deploying the level of resources that we're going to be deploying, it can do more harm than good,” Buster warned the crowd. “And you get one chance to start.”

New Hanover County has historically been underfunded when it comes to philanthropic giving, at $1,359 per capita compared to Buncombe—one of the counties Dogwood supports—which receives $7,633 or Forsyth, at $19,635, according to 2019 data from the IRS.

“They're not ready to scale up to do all the ambitious work that a foundation may have in mind,” Easterling said. “The last thing you want to do is just flood a bunch of money, drown them in the process.”

For now, Wilmington leaders are taking a wait-and-see stance because the endowment is still building its infrastructure. As a private, nonprofit organization, the endowment is shielded from public-records laws. But endowment board chair Spence Broadhurst, who is also president of the Eastern North Carolina region for First National Bank and a former mayor of Wilmington, said numerous times the endowment will be transparent in its decision making—that is, once it gets started.

A few weeks after the breakfast, Buster still wasn’t ready to talk about specific programs or issues. He has hinted that the first grants could go out the door by the end of 2022, but as of May, he is still pulling together a staff and strategic plan. Buster is taking the longview.

“If we say, 10 years from now, we're going to have whatever in this community, what do you need between now and then to get there?” Buster said. “It’s about setting those clear goals.”

If Buster gets it right, New Hanover could become one of North Carolina’s healthiest and most prosperous communities, and in doing so help define what foundations can do to right some of the nation’s systemic wrongs.

But only if he gets it right.

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William Buster, the newly hired president and CEO of the $1.25 billion New Hanover Community Endowment.

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Kevin Maurer is an award-winning journalist and three-time New York Times bestselling co-author. His books include No Easy Day, the inside story of the Bin Laden raid, co-written with former Navy SEAL Mark Owen. He has covered war, politics, and general interest stories for GQ, Men’s Journal, The Daily Beast and The Washington Post. Maurer also serves as director of community engagement for the Cape Fear Collective, a New Hanover-based nonprofit.