In a sense, the Chapel of the Cross has been an ‘endowed parish’ since 1924, when William A. Erwin provided the greater part of the funds needed to acquire additional land adjacent to the 1843 church building and its detached parish house and to build on that land a new church and a greatly enlarged parish house. Mr. Erwin established two trust funds, administered by independent trustees, to maintain and insure the buildings. The original corpus of those trusts consisted of commercial office buildings that yielded less and less income as years passed.

Today we receive only about $5,000 annually from the original Erwin trusts. Most of our endowment income comes from endowment or quasi-endowment funds that have been established within the past decade.

Endowment funds are those for which the principal may not be invaded due to restrictions placed upon the gift by the donor. Quasi-endowment funds are those for which a principal amount designated by the vestry is normally unavailable for use. The principal of quasi-endowment funds may be invaded in unusual circumstances by action of the vestry.

The total value of endowment and quasi-endowment funds currently under the control of the vestry is approximately $1.2 million. These funds are allocated among a number of separate accounting entities known as “special funds” in order to comply with restrictions placed on their use.

All of the principal of permanent endowments under vestry control is invested in shares of the Diocese of North Carolina Common Trust Fund. The diocesan trust is managed by Bank of America under the guidance and oversight of the diocesan Investment Committee. The diocesan trust distributes income quarterly at an annual rate of 5% of the three-year rolling average of the value of shares as of September 1. The remaining income is reinvested. The value of the endowment is reported in our financial reports on the accrual basis. This means that we ‘book’ unrealized gain and losses. In the past two years, unrealized losses have outpaced gains, resulting in a decline in the reported value of the endowment.

The $628,000 endowment for buildings and grounds originated in the 1950s with the gift of $100,000 by Collier Cobb, Jr., Emma Estes Cobb, and Mary Louisa Cobb. Subsequent additions have come from the estates of Nancy Dugan, Mary Arthur Stoudemire, Margaret Callie Johnson, Alice Lewis, and others, and from gifts of Collier Cobb III and Carolyn Cobb, Anne Gibson Hill, Jim Crow, and others. Several of these benefactions are restricted to specific purposes, such as maintenance of the fabric of the Chapel or the garden in front of it.

The $500,000 endowment for outreach and scholarships is derived principally from a major gift from Jim Crow. All of the income of the Outreach Endowment Fund, amounting to approximately $25,000 per year at this time, is contributed to work outside the parish through the operating budget. Other endowments in this category support scholarships for UNC-Chapel Hill students chosen by our University Ministry Committee (House and French scholarships), help offset the cost of enabling parishioners to participate in a variety of activities (Lantz Fund), or are available for use at the rector’s discretion (Duerden Fund).

Finally, three small endowments support our campus ministry program, the music program, and the work of the social ministry committee. The Campus Ministry Fund originated with a gift of $10,000 from Frank Kenan. The James Music Fund began with a $5,000 legacy from Lydia James, a long-time member of the senior choir, and the Social Ministry Fund came from an anonymous gift.

A complete listing of our “special funds” is found in the 2002 Annual Report. More detailed information is available in the annual reports of our independent auditors.

Without the income we enjoy from our endowment, it would be very difficult for the Chapel of the Cross to maintain adequately the wonderful physical plant we enjoy and impossible for us to provide the impressive array of programs we offer to our parishioners and the larger community. We owe an immense debt of gratitude to the many parishioners and friends who have remembered us in their wills and to those benefactors who saw a need and made it possible for us to respond to it.