In 2012, Brunswick County Economic Development Director Jim Bradshaw announced his office was forming a nonprofit foundation to raise private money to assist the economic development commission with industry recruitment and business development.
Since that time, according to tax records, the foundation has raised more than $215,000 in private donations.
But the foundation may not be a properly filed nonprofit, at least when it comes to the federal government.
While the foundation filed its initial paperwork to become a nonprofit with the N.C. Secretary of State’s Office in January 2012, “they never, for some reason,” filed the proper paperwork with the IRS to be a nonprofit, according to Brunswick County Manager Ann Hardy.
“Foundation tax returns were provided to the IRS,” Bradshaw said. “The foundation is still waiting on final designation as a 501(c)(3). The contributors contributed not for tax purposes but to support the economic development efforts. Based upon input from our legal counsel, we are very confident that the foundation is engaged in an appropriate nonprofit function and its tax-exempt status will be approved.”
The foundation received its start-up funding through donations from Atlantic Telephone Membership Corp. (ATMC), Brunswick Electric Membership Corp. (BEMC), Dosher Memorial Hospital, South Brunswick Islands Committee of 100, Southport-Oak Island Committee of 100 and Monteith Construction, according to its 2012 tax returns provided to Port City Daily through a public records requests.
ATMC, BEMC, Dosher and South Brunswick Islands Committee of 100 gave $10,000 each, while Southport-Oak Island Committee of 100 and Monteith Construction both gave $5,000. The foundation spent $43,745 in 2012.
In tax years 2013 and 2014, the IRS forms 990 have the foundation’s total revenues and expenditures but they do not list individuals or companies who donated to the foundation. In 2013, the foundation reported $82,067 in revenue and $66,520 in expenses. In 2014, the foundation reported $81,333 in revenue and $78,909 in expenses.
“I do believe it’s in the benefit of the county to have a foundation to do things for economic development with private money that the county can’t do,” Hardy said. “And I have some recommendations on how they can do that.”
During an April meeting of the board of directors, Bradshaw said most of the economic development marketing is paid for through the foundation, not the county-funded commission. Travel is also paid for through the foundation.
A board member asked Bradshaw about media inquiries into agency spending on travel or other expenditures.
“That’s why we don’t do it,” Bradshaw said about using commission money for travel purposes. “We take it out of the foundation. They come to us and say, ‘we want to see your spending,’ and we say, ‘sorry, that’s foundation money.”
“As you know when you taking industrial prospects out to dinner they may request wine or liquor,” Bradshaw told Port City Daily. “You may have to host them golfing. There are a number of scenarios that if I used taxpayer money to entertain clients, the media would be all over it. That’s where an Economic Development Foundation comes into play and using private sector funds, an ED director can provide the necessities for our industrial prospects without having to use tax payer money.”
Caroline Curran is the managing editor of Port City Daily. Reach her at (910) 772-6336 or firstname.lastname@example.org.