MINNESOTA
National Catholic Reporter
Brian Roewe | Jan. 16, 2015
Editor’s Note: This story was last updated at 3:10 p.m., central time.
The St. Paul-Minneapolis archdiocese filed for bankruptcy Friday morning in response to pending lawsuits related to the sexual abuse of minors by clergy.
The Associated Press first reported the development, long expected in a region gripped for more than a year by a sexual abuse scandal that has seen trust deteriorate in the local church. It is the 12th U.S. diocese to file for bankruptcy.
The filing of Chapter 11 reorganization came in the U.S. Bankruptcy Court of the District of Minnesota. The archdiocese pointedly stated its current situation is “because of the scourge of sexual abuse of minors.”
The archdiocese described bankruptcy as “the fairest way” to resolve existing and future claims of sexual abuse while at the same time continuing its ministries within the local church.
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In its court filing, the archdiocese estimated assets between $10 million and $50 million, and liabilities between $50 million and $100 million. It listed its number of creditors between 200 and 1,000, with clients of attorney Jeff Anderson representing 17 of the 28 largest claimants.
In November, the archdiocese released its 2014 fiscal year financial statements that showed a $9 million deficit in operating activities, net assets down $8.9 million and total cash dropping 60 percent, from $9.5 million to $3.8 million.
At the time, Twin Cities Archbishop John Nienstedt repeatedly used the word “trouble” to describe what the documents detailed. His chief financial officer also allowed for the possibility of bankruptcy as one possible path.
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