NH Resources – May 2003
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Diocese delayed audit report to include civil payout
By Albert McKeon
The Diocese of Manchester still intends to release an audited financial statement, but it will come months later than first expected, a church spokesman said.
Bishop John McCormack wants auditors to present a clear and comprehensive picture of diocesan finances, which is the reason for the delay, diocesan spokesman Pat McGee said Thursday. The diocese will likely release the statement within the next few months, he said.
“Rather than try to have it out now, we want to have it more complete,” McGee said. “The bishop does want it done as soon as possible.”
McCormack announced in February that the diocese would release the fiscal statement by the end of March. The announcement came when McCormack spoke to about 500 Catholics invited to a state-of-the-diocese address in Concord.
At that session, McCormack unveiled a plan to strengthen the Catholic Church in New Hampshire, including a vow to include the laity more in diocesan affairs.
At a time when critics wonder how dioceses are allocating parishioners’ donations, the statement would likely attempt to show how the Manchester diocese reached fiscal agreements with abuse victims. The diocese has settled with many individual plaintiffs, and last year made two group civil settlements exceeding $6 million.
The diocese has not used parish funds to settle civil litigation, including any money from the diocesan central fund, McGee said. Parishes place money into the central fund and then borrow, at a rate lower than rates offered commercially, for the construction or repair of buildings.
“My opinion is . . . that the public is interested in what effect the settlements have had on the diocese,” McGee said.
After McCormack committed to the audit, the diocese’s auditors – Howe, Reilly and Howe of Manchester – told him a quick release of such a report was not as simple as it seemed, McGee said.
Auditors are working to include all civil payments, McGee said. If a report had come out in late March or soon thereafter, it would not have reflected such payments, he said.
The diocese released in March a statement that covered the fiscal year from July 1, 2001, to June 30, 2002. If McCormack had not promised a new fiscal statement, the next report – for the period from July 2002 to June 2003 – would have been released next March, McGee said.
Instead of releasing the fiscal statement this past March, the diocese instead announced it had started making significant budget cuts, directly affecting pastoral programs, employees and the bishop’s residence.
Over the course of several months, the diocese laid off 20 full-time and part-time employees, as part of a plan to trim $500,000 in expenses. The diocese is also studying which services it can transfer to the parish level.
The diocese will also consider selling two Manchester properties: the bishop’s residence and Emmaus House, a youth ministry retreat. And the diocese could eliminate its monthly print newspaper, Tidings, whose editor lost his job.
The clergy abuse crisis, a slow economy and stock market losses have probably led parishioners to reduce their contributions, McGee said. The diocese also lost revenue with its endowed funds when the stock market went sour, he said.
Cutting $500,000 from the diocese’s $2.5 million operating budget does not include the potential sales of the bishop’s residence or Emmaus House. Rather, only operating expenses from those properties figure into the $500,000 savings, McGee said.
The diocese owns both buildings, but the bishop’s residence was
a gift. The retreat house is valued at $766,100, while the bishop’s
residence is valued at $633,300, according to the city of Manchester’s
By Kathryn Marchocki
An attorney who represents scores of people who say they were sexually abused by priests settled four more cases against the Roman Catholic Diocese of Manchester for $815,000 this week.
Attorney Peter E. Hutchins yesterday said this brings to 79 the number of settlements he has reached with the diocese for a total $6.8 million since the clergy sexual abuse crisis exploded early last year.
The four cases settled Wednesday involve one woman and three men who were sexually abused by three diocesan priests from 1972 through 1990, the Manchester lawyer said.
Hutchins said the diocese accepted the allegations as true.
"We've accepted these as credible accusations," diocesan spokesman Pat McGee agreed.
Hutchins withheld the priests' names at his clients' request to protect the victims' identities.
None was on the list of 14 priests accused of past sexual misconduct that was released by Manchester Bishop John B. McCormack in February 2002, Hutchins said.
At least one of the priests in the most recent settlement is dead, McGee said. The others are no longer in active ministry, he said.
Neither McGee nor Hutchins would say whether any of the three priests are the current targets of criminal investigation.
The settlements will be paid through the diocese's insurance, McGee said. No funds from general collections, Catholic Charities or schools will be used, he said.
The diocese paid a total of $6.29 million in settlements involving 87 men and women in 2002, McGee said. The total amount in settlements paid this year was not immediately available, he said.
McGee said the diocese is still in negotiations with attorney Mark Abramson,
who has about 60 alleged victims who have brought claims against the diocese.
By Kathryn Marchocki
Bishop John B. McCormack likely will need court approval before he can officially move out of his Manchester residence.
Former Manchester Mayor George E. Trudel willed the stately, red-brick home to the Roman Catholic bishop of Manchester in 1947 on condition it always remain the bishop's residence.
McCormack two months ago said he intends to close the residence, at 657 North River Road, by June 30 as part of a plan to save $500,000 in operating costs.
Trudel, a wealthy church benefactor who was mayor from 1922 to 1925, died June 2, 1947.
His bequest stipulated the real estate "shall be forever used as the private residence of the person who is the Bishop of the Roman Catholic diocese of Manchester," the will filed in Hillsborough County Probate Court said.
The diocese had six months from Trudel's death to accept this condition in writing, which it did.
"The bishop has every intention of complying with state charitable trust laws in the disposition of a property that has been bequeathed to him such as this one," diocesan attorney Ovide M. Lamontagne said.
"If the bishop decides to change the use of the property or if he decides to sell, I would expect he would seek permission from the probate court under a petition of 'cy pres' or deviation in a manner consistent with similar situations involving other religious denominations throughout New Hampshire's history," he added.
Attorney Robert A. Wells of the McLane law firm in Manchester, who specializes in estate and trust law, said it appears the diocese must file a petition with the probate court to ask for a deviation from the terms of the bequest.
The petitions generally propose doing something "as analogous as possible" to the intended use, he said.
For example, if the diocese says it no longer can afford to keep the property and asks to sell it, it might ask that the proceeds from the sale be used for a housing allowance for the bishop, Wells said.
The diocese could also petition to retain the property and reoccupy it at a later time, he said.
One issue the court might examine is whether any individuals or charities have a right of reverter to the remaining estate.
"If the rest, residue and remainder of the estate went to individuals and charities, the court could say . . . the terms are not being met and the property should go to whomever the remaining beneficiaries are," Wells said.
"There is no slam dunk answer on what should be done here," Wells said.
The will says the "rest, residue and remainder" of the estate should be divided among Arthur G. Archambeault, Corinne C. Dubois, Ella Provencher, Germaine S. Grenier and their heirs.
"The will speaks directly to the residence on 657 North River Road, and there is no reverter interest that is contemplated," Lamontagne said.
In announcing its reconfiguration plan in March, the diocese said it intended to close not only the bishop's residence but also Emmaus House, the diocesan youth retreat center, and eliminate nine employees, including the part-time housekeeper and cook who staff the residence.
The bishop and his advisers have not decided whether they will use the property for something else or sell it, said the Rev. Edward J. Arsenault, diocesan chancellor.
"It's not for sale at this time," Arsenault said.
The bishop also has not yet decided where he will relocate within the diocese, he added.
"He fully intends to remain bishop of Manchester and to continue to serve the people here," he said.
Trudel was a devout Catholic and frequent contributor to the church, said his friend Frank Binette of Laconia.
Binette said the Trudels had no children and he believes all Trudel's nieces and nephews are dead.
He named the house "Beausejour," which means beautiful dwelling or retreat, said Binette, 85.
Trudel, whose successful wholesale plumbing supply business earned him a reputation as the "richest French Canadian in New Hampshire," was proud to leave his home to the bishop.
"Just the thought that a bishop would be living in his home forever,
to him that was heaven," Binette said.
By Nancy Meersman
The Manchester Diocese will pay $6.5 million to settle the lawsuits of 61 people who accused the church of looking the other way when they were being sexually preyed upon as children by Catholic priests.
The payments will be made over a three-year period starting at the end of this year, the church said yesterday.
The settlement with attorney Mark Abramson's clients brings the total number of sex-abuse cases settled in the past 11 months to 176. The church said the total payout in that time has reached $15,450,000.
The diocese believes all but a handful of the sex-abuse cases are now resolved.
The three-year payout, the diocese said, is "acceptable to the complainants and also allows for the stabilization of the financial condition of the diocese."
Abramson's clients were the last large group to settle. He said the compensation per victim is about 30 percent higher than in earlier settlements. The highest compensation to a single victim is $405,000, he said.
"Compensation is a nice thing, but it's not going to make the pain go away," the Manchester attorney said. "Some of the victims have been living with this for 20 to 40 years.
"The thing that has helped them most is public awareness of what they have been through and the fact that some priests have been given the boot. And there have been some changes in the church."
The abuses stretch back 40 to 50 years. Twenty-three priests were named as having harmed children. The diocese said all of them have either been stripped of their authority to perform as priests or have died.
Bishop John B. McCormack said the church was grateful to be able to help people who reported sexual abuse.
"I hope this response by the church will help them heal from the wounds of abuse, and I pray that they will continue to know the healing power of Christ's love through our efforts," the bishop said in a statement. "I am personally sorry for the hurt they have experienced, and I have written to each person expressing my deep regret, an apology on behalf of the church and my willingness to assist them personally in any way that is helpful."
Typically, plaintiffs' law firms are paid one-third of a settlement, which would translate to a $2 million-plus payday for Abramson, Reis, Brown and Dugan. Abramson said the total fee to his firm would be less than one-third because some of the cases were referred by other lawyers who also would be paid from the settlement.
Patrick McGee, spokesman for the diocese, said some of the latest group to be paid were covered under insurance plans. Some, he said, will be paid out of the church's insurance fund, which covers deductibles and pays insurance premiums. He said the parishes pay just under 1 percent of their assessable income into the insurance fund.
"No parish, school or other institutional funds, including N.H. Catholic Charities resources, have been used in this or any other civil settlement," the church's statement said.
Last year, Abramson said he would not settle the cases "in the dark" but would dig out all the matters the church was allegedly trying to hide. He said church officials only agreed to a better settlement in these cases because they had been forced to turn over incriminating documents and the priests' confidential personnel files.
"We also obtained some rulings that were very damaging to them from Hillsborough Superior Court judges that made them very concerned about the way the litigation was going for them," Abramson said. "And that's why they ultimately paid us, I think, on average 30 percent more."
He said most -- but not all -- of his objectives in the litigation were accomplished.
The public became aware of the massive scale of abuse against children, he said. The revelations about sexual abuse by priests also prompted the Attorney General's Office to investigate the Manchester Diocese. State prosecutors earlier this year issued a 9,000-page public report on crimes against children by Catholic priests and the church's role in allegedly hiding the facts from the public.
"What I think we were not able to accomplish was removing the hierarchy in the diocese who were responsible for the abuse of many kids," Abramson said. "I am personally calling for the bishop to resign."
McGee said the bishop is blameless in any of the New Hampshire cases, as all pre-dated his arrival in the mid-1990s.
Bishop McCormack, who handled many sexual abuse cases as a top aide to former Cardinal Bernard Law, is a defendant in lawsuits by alleged abuse victims in Massachusetts.
McGee said, in contrast to other dioceses, Manchester has quickly responded to claims. The cases were amicably settled, he said, because McCormack wanted the victims to be able to go on with their lives. He dealt with the complaints "as a pastoral problem and not a legal problem."
The church said it sought to deal individually with those who allege they were harmed to help them financially and help them heal spiritually.
"They offered my clients an opportunity to meet with them, but not
one of my clients had any interest whatever in meeting with them,"
Abramson said. "This is just baloney about their wanting to take
care of the victims because they defended the cases vigorously and they
tried in court to force the clients to identify themselves so they would
either withdraw or settle for small amounts."
Manchester (NH) Union Leader
About a half dozen protesters paced the sidewalk in front of the St. Peter Church in Auburn yesterday as Bishop John B. McCormack appeared at a 10 a.m. service.
McCormack, a central figure in the child abuse scandal that has rocked the Catholic Church and Manchester Diocese for more than a year, didn't refer as much to the scandal as he has in previous sermons.
"We need to rise above our mixed feelings of one another," he said during the sermon. ". . . We all ask ourselves that question -- 'Should I do more? Could I do more?'"
Officials at the diocese say they believe all but a handful of the sex-abuse cases in the state are now settled. A settlement last week with a group of 61 people who say they were sexually abused by priests brings the total number of sex-abuse cases settled in the past 11 months to 176. The church said the total payout in that time has reached $15,450,000.
As he has at other parishes in the area, McCormack held a question-and-answer period after yesterday's service. Diocese officials shield those discussions from the media.
Demonstrators outside St. Peter walked along the road shouting and holding posters that say McCormack and other high-ranking church officials are criminals.
The alleged abuses stretch back 40 to 50 years.
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