Diocese Has Used up Half of Reserve Funds since 2008
By Erin Andersen
For the first time, the Diocese of Lincoln publicly released its annual finance report, revealing that more than half of its $21.29 million in reserve funds have been used to cover yearly expenses since 2008. The statement, published in the Nov. 26 issue of the diocese’s newspaper, the Southern Nebraska Register, included a letter from Bishop James Conley, noting that the diocese is at “an important crossroads.” At the crux of that crossroads is a $53 million capital campaign the diocese will launch in early January. Called Joy of the Gospel campaign, money will be earmarked to create more sustainable options supporting Catholic education, retired priests and seminarians, and help parishes and religious orders with needed building projects -- without subsidies from budget reserves. While dioceses across the country -- including Omaha, Wichita and Denver -- long have made financial reports public, the Lincoln diocese never has, said JD Flynn, special assistant to the bishop. By publishing the report, Conley hoped to tell the truth about the diocese’s financial position and demonstrate its need for creative fundraising and financial planning in the years to come, Flynn said. “Transparency in leadership is important to Bishop Conley,” Flynn said. It is also important to the Vatican. Earlier this week Cardinal George Pell announced that the Vatican’s finances are in a fair amount of dysfunction, and that outside expertise is needed. According to his exclusive interview with the Catholic Herald, auditors found millions of euros had been tucked away in accounts, not appearing on Pope Francis’ balance sheets. The good news is “the situation is much healthier than it seemed,” Pell said of Vatican finances in the Catholic Herald article. Audits of the Lincoln diocese found no such dysfunction, but highlighted a need to find other sources of funding -- and quickly. According to the report, as of June 30, the diocese had $62.95 million in assets and $54.67 million in liabilities, with a net reserve of $8.18 million -- $13.1 million less than it had in 2008. (Construction of the Newman Center and St. Thomas Aquinas church is not part of this budget, nor is the Diocese using reserve funds for the project.) Making the finance report public is “a good thing to do,” Conley said. "It lets people know where we stand financially." The publication is the latest in Conley’s efforts to be transparent with diocese financials. Since coming to Lincoln in November 2012, Conley hired Kevin Fitzpatrick as a lay chief financial officer; added several lay experts to the diocesan Finance Council, which serves as an advisory board; implemented new accounting software and management policies; and developed an updated budgeting process for the diocese. Conley said it is important for the diocese’s 90,000 Catholics to know where things stand -- especially as the diocese embarks on a five-year $53 million capital campaign. To date, 12 parishes -- large, small, urban, rural, those with schools and those without -- have quietly piloted the fundraising campaign to measure parishioners’ response. The diocese held its last capital campaign in 1999. Conley said that although there is really no good time to ask for money, “the need is very great -- especially with our schools,” he said. “And this is what bishops need to do. The apostle St. Paul had to go around and raise money in the early church.” The Joy of the Gospel capital campaign comes on the heels of comprehensive studies looking at the sustainability of Catholic schools into the future; the growing number of seminarians enrolling at St. Gregory the Great in Seward as well as other seminaries across the country; and an anticipated leap in the number of diocesan priests who will be retiring in the next 10 to 15 years. “When I first came to the diocese of Lincoln in 2012, almost within the first month, people came to me with these (financial) concerns -- especially for the schools,” Conley said. Of particular concern were schools like St. Mary’s and Sacred Heart in Lincoln, which serve low-income and minority families and are struggling financially. “We need to look at those schools and make sure they are on firm footing for the future,” he said. Through the capital campaign Conley hopes to earmark $20 million for Catholic schools. Money will be used for innovations in curriculum, teacher pay and creating marketing, retention and development plans. "We believe we have a wonderful school system, but we need to convince others of that," Conley said. "That requires marketing our schools and being able to tell the good story -- the story of our schools." About the same time Conley heard about school-funding issues, the rector of St. Gregory the Great Seminary came to him with a problem. With 48 seminarians, the school was at capacity, and couldn't keep pace the the growing number of men called to priesthood. The rector suggested adding a new wing to the seminary, increasing capacity to 75 or 80 seminarians. “We pray for vocations, and God is answering our prayers,” Conley said, but it comes with a cost of $1.3 million a year to house and educate seminarians. Shortly after the St. Gregory meeting, Conley learned that the diocese’s retirement fund was severely underfunded and would not cover the costs of the estimated number of priests retiring in the next 10 to 15 years. “All that happened in my first month here,” Conley recalled. “I thought maybe it is time for a capital campaign.” Plus, the new bishop had his own projects -- he wanted to reach out to Catholics who had fallen away from the church. He wanted to meet the needs of those who had divorced and remarried, Hispanics and people in prison. "I am very passionate about that," Conley said. He also is committed to creating Catholic studies institute where students (Catholic and non-Catholic) can learn about the philosophy, literature and history of the church. He points to a similar program started at Arizona State University in 2012, as a model for Lincoln. “As a convert to the Catholic faith I know how powerful it can be,” Conley said. Before going forward with the Joy of the Gospel campaign, the bishop conducted a feasibility study in which he interviewed every pastor in the diocese and looked at the needs of all 135 parishes. “We came back with a $53 million figure and decided let’s try to do this,” Conley said. “To successfully proclaim the Kingdom of God in the diocese of Lincoln, we need new resources and new plans for the future,” Conley wrote in his letter to dioceses. “The Joy of the Gospel campaign … will allow us to secure funding for the important work of the diocese of Lincoln and to help ensure our financial sustainability well into the future.” Reach the writer at 402-473-7217 or eandersen@journalstar.com
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