Catholic Diocese of Spokane, Washington

From the

Official News Magazine of the Diocese of Spokane

Deacon Eric Meisfjord, Editor
P.O. Box 48, Spokane WA 99210
(509) 358-7340; FAX: (509) 358-7302

Parishes take major step toward satisfying financial commitment

by Father Michael Savelesky, for the Inland Register

(From the Oct. 4, 2007 edition of the Inland Register)

Faithful to a commitment made under terms in the Second Amended Plan of Reorganization approved by the U.S. Bankruptcy Court in the Diocese of Spokane’s bankruptcy case, as of Oct. 1, the 82 parishes in the Diocese have deposited nearly $7 million in the bankruptcy’s Plan Trust.

Ten million dollars are required from the parishes as their part of the bankruptcy’s total settlement sum of $48 million. On Oct. 1, the outstanding balance of approximately $3 million started accruing 6% interest until it is fully satisfied on or before a Dec. 31 deadline.

Without the hire of an outside professional firm, the individual parishes in the diocese have been conducting a Chapter 11 Settlement Campaign since May in order to solicit the required funds. The campaign has included mailings from Bishop Skylstad to all households, letters and information shared by pastors, small group gatherings and pulpit presentations.

By consensual agreement among the pastors, each parish assumed responsibility for its pro-rata share of the aggregate $10 million obligation. The shares were determined on the basis of a formula used by the diocese in its Annual Catholic Appeal for the solicitation of funds for diocesan administrative expenses and various ministerial services.

During the Campaign every Catholic household in the diocese was asked to make an immediate financial contribution to the Settlement Campaign as well as an on-going four-year pledge. According to a Sept. 27 press release issued by the Association of Parishes (AOP), parish pastors report that the majority of their parishioners have opted to make large, one-time payments.

The press release noted that the solicitation of funds will continue until Dec. 31. Anticipating a shortfall in solicited funds, the leadership of the AOP has coordinated an effort to procure a collective loan by those parishes unable to satisfy their pro-rata share of the $10 million by Dec. 31.

As mediation in this case moved all the parties toward resolution, it became increasingly clear that it was in everyone’s interest to agree upon the $48 million settlement sum and terminate the costly and open-ended legal battle of who owned parish property. The question became one of the most complicated issues in the litigation.

While technically the ownership issue remains an unsettled legal question, the court-approved Plan of Reorganization provided a practical means for the diocese to settle scores of abuse cases and for parishes to become separate legal entities which can hold title to their own property by contributing financially to the $48 million settlement sum. Last May every parish in the diocese became a non-profit corporation and titles were transferred to the name of those entities.

The titles, however, remain held by the Plan Trustee until the parishes’ $10 million commitment is satisfied on Dec. 31.

The ability of the parishes to raise $10 million has been a central question in the bankruptcy proceedings. Based on a study of parish finances and the history of fund raisings efforts in the diocese, the AOP has consistently represented to the bankruptcy court that this figure reflects the “best effort” of the Catholic faithful.

The AOP’s press release observed that “the rapidity with which the parishes have been able to provide nearly $7 million does not reflect their ready access to sequestered funds. The people in the pews have been incredibly generous – and they have made real financial sacrifice – often using personal savings, even portions of Social Security or retirement payments – to facilitate the resolution of the Diocese’s bankruptcy case.”

“Several parishes have borrowed from funds set aside for other purposes and other projects (money which will need to be replaced). Every parish can speak to the increased financial pressure resulting from its participation in the Settlement Campaign,” according to the statement.

“The willingness of parishioners to contribute so generously and sacrificially to the Chapter 11 Settlement Campaign is evidence of their living faith. As Christians they have recognized the Gospel invitation to help their brothers and sisters without regard to whether they were being fair to themselves. They have desired to not only bring finality to the Diocese’s bankruptcy litigation, but also to help provide just compensation for the victims of sexual abuse by priests and other Church ministers.”

After more than two years of costly and painful litigation, the Catholic faithful in the diocese clearly have expressed their desire to concentrate once again on the ministry and mission of the Church in the diocese. The AOP’s press release observed that a significant element of that ministry is the continuing effort on the part of parishes to foster the education and welfare of children under the light of the Gospel and to assure their safety.

(Father Savelesky is pastor of Assumption Parish, Spokane, and priest co-chair of the Association of Parishes (AOP). The AOP, co-chaired by Robert Hailey, was formed in October 2004 at the initiative of pastors and parish administrators in order to provide legal defense of the temporal goods of parishes.)

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