The True Cost of the Settlements

March, 2010

By now it is well known that the fiscal year reports for 2008 and 2009, so long overdue, have been released by the Diocese of Springfield.  Details of diocesan reorganization remain secret for the moment, so it's hard to say what it all means.  The summary, in my understanding: "We're pretty much broke.....but it's not our fault".

The financial meltdown was reported as the weekend got underway by WWLP22 TV, which has emerged as the go-to news organization for the Diocese. The Springfield Republican will probably dig deeper into the story in time, though they seem only mildly interested these days in Diocesan stories.

The Catholic Observer which came out on Friday had an insert with balance sheets and summary.  I was troubled by the front page comments of Bishop McDonnell.

It's now clear that the parish-closing program which began in earnest in March of 2007 is a large part of this picture.  At the time, parishioners were reassured that finances had "nothing to do" with the closings. Over the next three years at least 25% of the parishes in the Diocese were closed or altered, all while parishioners were flying blind with no access to the most basic financial information about the Diocese. Now, after the closings, we learn that our bishop considers "parish debt" to the Diocese as one of the top 3 factors of the financial shortfall.

Again we see, as in the abuse crisis, the corrosive effects of secrecy. This tendency of bishops to stonewall when under pressure was memorably described as the "narcotic of secrecy" by the folks at Christifidelis and although we don't always agree with their positions, here they hit a home run.

McDonnell stated that the 8.5 million settlement amounts were covered "in large part" by the insurance companies, and that this fact should put to rest the perception that the settlements had a part in the financial woes of the diocese.

Number one, the 8.5 settlement is not just about money.  It is mainly about acting justly and with integrity.  The legalistic hair-splitting and the reluctance displayed by church officials in settling accounts with over 100 victims of sexual abuse is a long, sad story.  This drama has been playing out on center stage in Springfield for over a decade.  Despite ample opportunity to do so, church officials have not changed their tune in all this while, and continue to claim that somehow no one in charge knew anything about abuse, even though it's clear that this is no longer believable.

This conduct is the main reason, in my opinion, why many thousands of faithful Catholics in Western Massachusetts do not trust the diocese and do not support its churches. That is a recipe for a financial crisis, and guess what?  We have a financial crisis. 

When it comes to who paid what, the Bishop is referring to the fact that the 8.5 million dollars earmarked for victims came from insurance companies, and not directly from Diocesan funds.

This much is true.  But, it only tends to raise more questions.

For example, if the Diocese spent 7.75 million on the first round of 46 victims and sued the insurance companies for full reimbursement right up until the 11th hour of the lawsuit, and if the insurance lawyers found no hint of supervisory negligence during discovery, then why did the Diocese settle for only 3.5 million in reimbursement, instead of holding out for the full 7.75?

And, if 5 million was allotted for the second round of 59 victims, why was only 4.5 million awarded?  What happened to the remaining .5 million?

Also, what about the costs that were not reimbursed? They amount to a significant amount of money. How can the Bishop say that these costs played no role in the financial meltdown?

It is no exaggeration to say that direct and associated costs are likely to be more than 10 million dollars.  They may be as high as 20 million.  It is astonishing that the Bishop would seek to downplay figures of this magnitude.  Here is a short narrative about those costs:

The diocese expended $7.75 million (7 in cash, .75 in real estate) for the first round of victims in 2004, an average of 168,478 per victim, and got reimbursed 3.5 million in 2008, after a bruising 3-year insurance trial, resulting in a loss of 4.25 million. The expectations of the Diocese that the insurance companies would pay the entire tab of 7.75 million persisted until the end, as documented in Paper 111.1.

The remaining 5 million of the insurance settlement (remember, the total settlement was 8.5 million) was earmarked for the second round of victims.  But only 4.5 million went to the 59 victims, an average settlement of about 77,203. There has been no accounting for what happened to the remaining .5 million.  It could have gone to the arbitration company, to the lawyers, or to the chancery treasury.  At one time it was stated that it might go for "future counseling" but there is no way to verify if that happened, or if so, how much has been spent.

Incidentally, when we say an average of "77,203" was awarded to each victim,  you have to remember that around 30 to 40% of this amount is usually given to their lawyers as a contingency fee for the litigation.  And, that 2,000 was paid to the arbitration company for each claim, 1,000 from the victim, and 1,000 from the diocese, respectively.

To the direct Diocesan loss of 4.25 million must be added the lawyers' fees specific to the settlement, found under "Civil and Canonical Fees" in the Child Protection heading in annual reports:

Civil and Canonical Fees

2004     354,948
2005     209,328
2006     101,616
2007     229,000
2008     366,218
2009     161,013

subtotal 1,422,123

The 2005 diocesan report on abuse by Laura Reilly included these figures for Jan. 2004 - Jan. 2005:

payment for priests counseling 112,452
payment for victims counseling 145,470
subtotal     257,922

Also, there was an initial grant for future counseling to Behavioral Health Network in 2004 of $50,000. It is not known if this is a recurring annual expense.

totals: 4,250,000 + 1,422,123 + 257,922 + 50,000 = $5,980,045.00

Thus, the cost to the Diocese for these figures is nearly $6 million.

The "clergy on involuntary leave" category of the annual budget was $676,705 for the period 2004-2007, 135,686 for FY2008, and 120,433 for FY2009.

When the total of this last category (932,824) is added in, we have a new total of 6,912,869.

Then we come to a few more items.

The first settlement for 17 victims of Richard Lavigne in 1994 (handled by Attorney Michael Wiggins of the Boston area) was 1.4 million, so that brings the total up to around 8.5 million. It was said at the time that this amount came only from insurance funds.  However, this amount had ballooned to 1.7 million by the 2005 report from Reilly, so clearly, other payments were being made. It is not known who paid them, or who got them.

At this point we start to run out of gas, because counseling costs for clergy and victims in subsequent diocesan budgets are hard to trace.  We now know that there were other confidential settlements, like the one to Danny Croteau's brother in around 1996 or so, but these remain sealed. And, the most recent revelations, in June of 2010, about settlements concerning the Rev. Al Blanchard in the 90's, are yet another part of the picture. We are left with saying "at least 10 million, and probably more".

The last category to mention is perhaps the most mysterious (and possibly the most enraging for many Catholics).  I am referring to the benefits for Bishop Dupre, which began when he fled the Diocese in February of 2004.  These benefits have not ceased, as far as anyone knows.  Although on several occasions Diocesan spokesmen have admitted paying for his support, they have never said how much.

Again, it is not so much the dollar amount that hurts.  It is more damaging to the health of the Diocese that there is no explanation offered by officials to faithful parishioners of the Diocese: no transparency, no oversight, and no responsibility taken for the former Bishop. Go to the Diocesan web site right now and you will find a complete void concerning Bishop Dupre.

For these reasons we can say that the total of direct and associated costs must be more than 10 million, but how much more is anyone's guess.

The Reality of the Parish Councils

We've been talking about the parish council as envisioned by Bishop McDonnell: " is my wish that every parish of the diocese have a viable, working and dedicated Parish Pastoral Council..." These are collaborative and deliberative bodies which are supposed to play a key role in helping the laity live out their baptismal responsibilities.

Now we get to the reality of what we actually have.

The widespread closings that have affected some 25% of the parishes in the diocese provide an opportunity to see how the collaboration and deliberations of the councils have played out in a real-world environment.

Let's ponder the experience of Richard Brittain, a parishioner in South Lee.  When he learned in Sept. 2005, that his local church, St. Francis, was to temporarily close with no explanation, he sought a meeting to discuss this with his pastor.  Alternative plans, including suggestions and questions, were drawn up by Brittain and others.  Nothing happened, because the pastor avoided Brittain.  The pastor did not return phone calls, letters or anything else.  Brittain fared no better with Bishop McDonnell. Eventually, St. Francis's closed, and has not reopened since.

By the time William Euliano, a parishioner of All Saints in Agawam, had been through several years of wrestling with his pastor and Bishop McDonnell over the changes and closings in his area, he had this to say in Jan. 2009: "...When the Bishop announced closures were due to a potential shortage of priests in August that argument was bogus. When Monsignor Bonzagni pled the case, that argument was bogus. And now in retrospect that argument is still bogus. It's very hard to get the Catholic Church to tell you the real truth about anything..."

When parishioners Caroline Bobala and Phyllis Grondalski heard the news that Immaculate Conception of Indian Orchard was slated to close, they were shocked.  Wasn't it just a year ago that the parish had put in, at their own expense, a $400,000 elevator upgrade, one that was approved by the Bishop?  They were quick to register their disappointment and to push for IOICC to stay open.

In Pittsfield, St. Therese's Church was an unexpected addition to the massive closings of about half of the city's churches.  Or so said Walter Doerle, who was one of the St. Therese representatives at the listening sessions to discuss alternatives.  At least, he thought they were discussing alternatives. He said later that no consensus was reached at the planning meetings, and that diocesan representatives were careful to take names and numbers of those present for the purpose of getting back to them.  That "getting back to" never happened, and the next thing that Doerle knew, the church was closed.

The ongoing saga about the roof and other repairs for St. Mary's in Northampton gives another glimpse at parish/diocesan communication, or lack thereof.  Prominently featured in stories about the issue is parishioner Thomas McGee, one of a group that had commissioned a structural report from an engineer.  McGee has stated on more than one occasion that "...there's a great discrepancy between the information provided to the citizens of Northampton and the faithful of St. Mary's Church regarding the repairs...".

Now, what is so important about Richard Brittain, William Euliano, Caroline Bobala, Phyllis Grondalski, Walter Doerle, and Thomas McGee?

The important thing about all of these parishioners is that they are not just parishioners.  They are the parishioners who stepped forward and tried to help the bishop with his mandate.  They are all current or former members of the parish council, or members of a committee of the parish councils.

A Trial Balloon (with postscript)

"We've had some parishes express some concern over the cost, these are difficult financial times our feeling is you have to invest in the future you can't simply sit back and think that people will come without being asked, without being encouraged," said Dupont.

This is supposed to explain why Bishop McDonnell wants to begin charging parishioners $6.00 a year for a monthly magazine which will replace the bi-weekly Catholic Observer newspaper.

The first thing I notice is that once again McDonnell has looked in his mirror while shaving and seen the image of Jack Welch or Lee Iococca.  What else would explain why he would send this memo to Mark Dupont and have Mark read it to WWLP News, where Elysia Rodriguez reported on it?

Let us examine this trial balloon.

Mark "Mariano" Dupont puts an extreme spin on this one, even for him.  This ball is practically uncatchable, but we'll give it a try!

The euphemisms point in the direction of evangelicalism, in other words, you have to have a glossy, attractive media in order to attract new Catholics in this day and age, and perhaps win lapsed Catholics back into the ranks.  Fair enough.

The problem is, parishioners in this diocese already know what Bishop McDonnell's idea of media is. We have increasingly less information each year, not more.  People in the pews, without question, know what the Catholic Observer is, and what it stands for – and that explains why it is not read and loses money each year.

To put it bluntly, I gather that the Catholic Observer, by the evidence of reading it religiously for the last two years,  is not particularly interested in truth.  Journalism 101 says that truth must be the cornerstone of the media.  And truth includes not leaving out important items, just as much as it does putting them in.  The Catholic Observer follows the party line as laid down by Bishop McDonnell.  It is relentlessly clerical in tone, and, like the web site of the diocese, it is in denial.

This explains why you will see nothing in the Catholic Observer about financial support or anything else about Bishop Dupre.  And, nothing about Richard Lavigne, convicted pedophile. And, nothing about the 50 some-odd priests of the diocese credibly accused of sexual abuse - who they are, where they are, and what treatment they are receiving. And, nothing about the deliberations of the parish councils of the diocese -  the idea that the voice of the laity matters (in distinction to the voice of the clerical branch) has apparently never occurred to the people who run the newspaper.

 And yet, all of these items are of great importance to the people of God in Western Massachusetts.

So: Mark.....maybe we should work on having a newspaper that is worthy of the name, before talking about a change to another format?

The pitch that parishioners should reach into their wallet for this upgrade is another chin-scratcher.  Why on earth would we want to pour more money into an organization that does not report on the money we have already given? Does not Mark realize that the Annual Catholic Appeal already allots over $200,000 to the media of the diocese?  This trial balloon seems to be another attempt to restructure the money flow so that the parishes give more and more to the central organization with less and less accountability.

Let's look at the Annual Catholic Appeal:

From the whole budget of 2,753,398 for ACA, the school portion is 707,700  for "Education Support to Catholic Elementary and High School Students", plus 162,750 to "Diocesan School Office", so the total is 870,452. That is close to 32% for education.  Don't get me wrong, education is important.  But, it is also a part of the central administration.  It is not really what the Appeal pretends to be all about, which is the corporal works of mercy to all men, women and children of the area, Catholic or not.

What I find disturbing is that in the ACA brochure and cover letter and in follow-up mailings, one of which I got last week, the delivery system that is run by the diocese is hardly mentioned at all - and many of the parts of this system are costly.

For example, a lot of "pastoral" things that involve the parishes, plus parish religious education office (at 204,000), and stewardship and development (at 215,000), so that they can continue sending all of this mail out and processing all the checks, etc., - all of these are clearly part of the central administration of the diocese.

Instead, the bishop always leads by stressing the things that he knows most people will donate to without reservation: aid to the homeless, the sick, the elderly, the poor.

In fact, these things represent very small slices of the budget, only 10,000 or 15,000 here and there.
I'm not saying these small slices are not worthwhile, but I think that the appeal should be truthful and put the stress where it belongs: the vast majority of the budget supports the Diocesan delivery system, and is not direct aid to the corporal works of mercy.

When may I expect to see these issues addressed in the Catholic Observer?


Postscript: while reading the announcements accompanying the release of FY2008 and FY2009 over the weekend I noticed that this trial balloon is, in fact, a done deal.  Odd how the change to a magazine was portrayed as "potential", "pending approval" and so on, in the WWLP story.

In fact, the Catholic Observer will cease publication in June.

It says in the Financial Report insert that "...under a three-year pilot program, parishes will be asked to provide this magazine to all families listed in the parish...". 

Hug A Nun

a group of extremists with a narrow political agenda attempt to forestall social justice and face a moral uprising in the ranks.  no, I am not talking about the Republicans, but about the USCCB, the American bishops group that locked horns with the Catholic hospitals (largely led by nuns).

thankfully, the bishops lost. see this article by E. J. Dionne for more.

it is too soon to understand completely the dynamics which led to the majority of Catholic hospitals rejecting the stand of the bishops.  suffice it to say that the health care bill (which affects at least 30 million uninsured) would not have passed without the support of the nuns.

it reminds me of Kenneth Brigg's excellent book of a few years ago about the nun's story.  my conclusion upon finishing this book is that it is a blueprint for the laity.  every unfair and nasty thing that was done to the nuns by the hierarchy (and, more importantly, every opportunity that this rejection opened up to them) is in store for Joe and Jane Catholic.

check it out:

The Ideals of the Parish Council

The last post was quite long, but from it we extract the kernel; according to Bishop McDonnell:" is my wish and mandate that every parish of the diocese have a viable, working and dedicated Parish Pastoral Council."
Why are they so important? And, what makes them so special?

According to McDonnell, they are "... open more than ever to encouraging the participation, support, and expertise of lay people in parish life. They are meant to help us all implement the mission of being Church at the parish level, the deanery level and the diocesan level..." The Bishop is here following doctrinal advice which sees the parish as a sort of cell of the church.  In other words, the church is built from the ground up.  Certainly, the pointy end of the pyramid is the most visible part of the church, much as a mountain-top is the most visible part of the mountain.  But socially, the church always works from the base up, no less in our times than when Christ walked the earth.  Money-wise, this is also true. 

People sometimes write fanciful letters to the editor suggesting that "millions and millions of dollars in Vatican artwork" should be liquidated in order to solve local problems.  This is not really the way the money tree in the church works, as I suspect most Sunday church-goers who pop a check in their weekly envelope would confirm.  It is the people at the local level who support the upper reaches, not the other way around. So, the suggestion that the church starts locally is not really news.

McDonnell is suggesting, in conformity with church doctrine, that not only the monetary support, but also the personal qualities (the authority, good sense, and good will of the Catholic people) should percolate upward to the diocesan, regional, and international level, in order to make a whole church.  Makes good sense. Question is, how do you implement that?

McDonnell has some ideas.  If you look at the guidelines, you see "action", "input", "contribute", "collaboration"; the council is "open to all". An annual request should be made for new members. Once a plan has been made, additional input is to be continually sought. And, "...the agenda is to be published and meetings are open to parishioners..."

Wow.  It all sounds so....democratic....?

Indeed, the more you look into church doctrine, the more you find that lay equality, debate, free speech and collaboration are not just frills; they are supposed to be the cornerstones of Catholic values.  We learn in Lumen Gentium 37 and in the Decree on the Apostolate of the Laity of these lay rights and responsibilities. 

For example, in Lumen, the laity are empowered - and even obliged - to speak out on ways to improve the church. The shepherds (clergy) are supposed to encourage this speaking out, and allow the laity freedom and room for action. The experience of the laity is supposed to help guide this earthly enterprise toward the best methods, the best liturgy, the best results.  The clergy cannot do it alone.  Indeed, there is no pretense in church documents that the clergy are superior to the laity.  The church is an organic unity of lay and clerical members.

There are no passive roles; there is only a diversity of ministry.

We learn that the rights and duties of the lay apostolate do not come from the hierarchical structure of the church; rather, they come from our union with Christ. This is perhaps the most under-reported aspect of the lay vocation.  While the ecclesiastical ranks (clerical) are highly ordered, the lay vocation, and unique lay charisms (gifts) are not like that. The laity do not get their marching orders from the clerical ranks.  It's more like a direct route to the Godhead.

The laity are meant to collaborate with the clergy, to be sure, but this collaboration demands that the laity are self-directed.  Without a personal mission grounded in self-respect and dignity, collaboration cannot take place.

"For the exercise of this apostolate, the Holy Spirit Who sanctifies the people of God through ministry and the sacraments gives the faithful special gifts also, "allotting them to everyone according as He wills" in order that individuals, administering grace to others just as they have received it, may also be "good stewards of the manifold grace of God", to build up the whole body in charity. From the acceptance of these charisms, including those which are more elementary, there arise for each believer the right and duty to use them in the Church and in the world for the good of men and the building up of the Church, in the freedom of the Holy Spirit who "breathes where He wills".

The reminder that the laity have "...the right and duty to use ... [their gifts] in the Church..." as well as in the world is important. Here we come full circle, because it's obvious from all that has been said that the parish council emerges as the one place where this fruitful collaboration of clergy and laity will happen.

Human activity to be sure, but listen may hear a rising wind. Summing up, the parish council is a deliberative body of laity which has been given authority to act in a collaborative fashion with clergy by church doctrine. 

What is it that the parish council is not?  It is not a rubber stamp.  Nor is it a tool with which a pastor molds his "pastoral vision". It is not a proxy for the rest of the parish.  Parish councilors are not simply models for the rest of the parish, much as an altar boy or girl might be a totem for the laity during the liturgy.  The parish council is much more.  Parish councilors, seemingly so local, lowly and humble,  can realize some lofty goals by

"... bringing to the Church community their own and the world's problems as well as questions concerning human salvation, all of which they should examine and resolve by deliberating in common. .."