August 27, 2025
Can you describe the catalyst for the study… what has prompted you to take this action now?
A. The catalyst for this study stems from our organization’s commitment to long-term sustainability and continued compliance with public charity status requirements. As a relatively new nonprofit, we’ve made meaningful progress in building both our programs and infrastructure, including the establishment of a board-designated quasi-endowment. However, we’ve identified that our current level of public support—particularly contributions from the general public—may present challenges in future years when measured against the thresholds required under the IRS public support tests.
This realization prompted us to take proactive steps to better understand the dynamics of our public support and to identify strategies for increasing it. We want to ensure that our funding model aligns with both our mission and regulatory expectations, and that we are positioning ourselves for growth in community engagement and donor diversification. The timing is critical as we approach key reporting periods and strategic planning milestones, making this an opportune moment to engage expert guidance.
Do you know if other entities similar to NHF that are or were a part of the Dogwood Trust have conducted similar studies?
A. While Nantahala Health Foundation (NHF) is not formally a part of Dogwood Health Trust, it was one of several legacy health foundations created following the sale of Mission Health to HCA Healthcare. These foundations were established to continue supporting health and wellness initiatives in their respective communities, independent of Dogwood, which was tasked with stewarding the broader proceeds from the sale. To date, we are not aware of any studies conducted by these peer legacy foundations that specifically address the IRS public support test.
Has the idea of restructuring been considered previously? If so, what was the outcome?
A. Yes, the idea of restructuring has been considered previously. Over the past several months, our board has been engaged in a thoughtful journey of discovery around the alignment between our funding model and our public charity status—particularly in light of our identity as a legacy health foundation. This exploration has focused on the implications of both significant foundation support and income generated from our investments, which may pose challenges under the IRS public support test.
As a legacy health foundation, our structure and funding sources differ from many traditional public charities, and this has prompted us to ask whether our current model is the best fit for our long-term goals and regulatory obligations. Through internal discussions, consultations with legal and financial advisors, and a review of IRS guidelines, we’ve come to recognize the need for deeper expertise to identify strategies to strengthen our public support and, as applicable, to help us evaluate potential restructuring options.
This study represents the next step in that journey—an opportunity to engage resource development consultation that will guide us in aligning our funding model with both our mission and our status as a public charity.
