Twin hit of abuse claims and pandemic could push NJ Catholic dioceses toward bankruptcy

The Record

October 19, 2020

By Deena Yellin

For Catholic churches around the country, it has become a familiar refrain: After shelling out millions of dollars in settlements to survivors of clergy abuse, a diocese says it’s broke and declares bankruptcy.

The Diocese of Camden, representing a half-million Catholics in 62 South Jersey parishes, became the latest to file for bankruptcy protection on Oct. 1 — 10 months after a new state law waived the statute of limitations on decades-old abuse claims.

It’s unlikely to be the last. If history is any guide, bankruptcy experts say, when one diocese in a state files for Chapter 11, others often follow. In North Jersey, the dioceses of Newark and Paterson, representing some 1.7 million worshippers, are caught in the same vise of legal attacks and COVID-19 financial strains, said Charles Zech, a professor emeritus at the Villanova School of Business in Pennsylvania.

“Given the uncertainty associated with the statute-of-limitations window in New Jersey, I suspect that every diocese in the state is in danger,” he said.

To parishioners, the legal maneuvers may have little visible impact on the ground. A Camden diocese spokesman said there are no plans to cut churches, staff or programs. But the filings have angered victims’ advocates and plaintiffs attorneys, who say bankruptcy is a ploy by the church to dodge legal accountability for past crimes.

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