Catholic Dioceses of Rochester, Buffalo Sue Sba for Refusal of Pandemic Emergency Loans
By Gary Craig
The Roman Catholic Dioceses of Rochester and Buffalo have sued the federal Small Business Administration for refusing to allow the dioceses to seek emergency loans to offset the loss of money during the novel coronavirus pandemic. The refusal of the Small Business Administration, or SBA, has nothing to do with the fact that the dioceses are religious institutions; faith-based and nonprofit organizations can seek the loans. However, the SBA is not providing financial help to businesses in bankruptcy proceedings. Both the Diocese of Rochester and the Diocese of Buffalo are seeking bankruptcy protection in the wake of hundreds of claims of sex abuse by priests and nuns. The lawsuit could have far-reaching consequences, given that the emergency loans are now denied to entities seeking bankruptcy protection from creditors. And the dioceses are seeking a quick hearing because the SBA loans are being distributed on a "first-come, first-served" basis, so the $349 billion designated for the program could be exhausted quickly. The dioceses, "like many other businesses, have been financially affected by the COVID-19 pandemic in ways that could not be foreseen," attorneys write in the lawsuit, filed Wednesday in federal court. Parishes have been closed during the "stay-at-home" orders, reducing monetary offerings, the lawsuit states. "The parishes derive a significant portion of their revenue from offertory collection during masses and a significant portion of the offertory collections occur during Holy Week, which includes Easter Sunday Mass," the lawsuit says. As long as "stay-at-home" orders are in place the dioceses will "struggle to continue making payroll payments," according to the lawsuit.
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