Cash-strapped Buffalo Diocese Wants to Speed up Bankruptcy Case

By Jay Tokasz
Buffalo News
October 6, 2020

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Buffalo Diocese officials, citing a sharp decline in donations and an estimated $4 million per year in bankruptcy costs, are pleading with a federal judge to speed up its reorganization by reducing the time childhood sex abuse victims can file claims and appointing a mediator to negotiate a settlement.

Diocese officials told Chief Judge Carl L. Bucki that the diocese is strapped for cash and no longer provides financial support for 19 programs and ministries, including outreach to youth and migrants, lifelong faith formation, evangelization efforts and aid to Catholic elementary schools.

The diocese discontinued tuition subsidies for 34 Catholic schools, which in the past have received as much as $4 million from the diocese, Sister Mary McCarrick, diocese chief operating officer, wrote in a letter to Bucki.

McCarrick said some schools “are in a very real danger of closing” because of the loss of diocese funding. Bishop Edward B. Scharfenberger last month appointed a task force to study consolidations of churches and schools.

The diocese also has reduced spending for campus ministry, its outreach to deaf people, its Office of Worship and support for priest retirement homes, among other programs, according to court papers.

The diocese, trying to balance its budget, will spend $9.5 million on operations this fiscal year, which is less than half of what it spent just three years ago, Charles Mendolera, executive director of financial administration, said in court papers.

But Mendolera said the costs of the bankruptcy, including lawyers and other professional fees, will outpace any of the savings from the cost-cutting moves, especially if the diocese must litigate cases instead of trying to resolve them through mediation.

He urged Bucki to reconsider a Sept. 11 order that rejected requests for a mediated settlement process and set Aug. 14, 2021, as the deadline for abuse claims to be filed against the diocese. That's the same date the extended Child Victims Act window closes in state courts.

The diocese wants a deadline of March 15, 2021. Its lawyers argued that waiting until August could delay “meaningful negotiations” regarding a Chapter 11 plan until 2022.

The diocese also is seeking a mediated settlement process, which largely would spare the diocese and 161 parishes from having to defend themselves in individual child sex abuse lawsuits. More than 400 plaintiffs since 2019 have sued the diocese and other area Catholic entities, including parishes and schools, over alleged abuse, mostly dating back decades ago.