FRESNO (CA)
Bakersfield.com [Bakersfield, CA]
September 15, 2026
By John Cox
The Roman Catholic Diocese of Fresno is dealing with a new set of financial troubles, one that’s unrelated to the sexual abuse claims that last year prompted it to file bankruptcy — and this time the problem directly impacts former and current church workers.
Bishop Joseph Brennan sent a letter last month to members of its retirement plan saying their pensions will be reduced because the benefit is “significantly underfunded,” along with those of tens of thousands of other enrollees around the country.
He noted that accrued benefits under the plan were frozen effective June 30, meaning that despite their continued contributions, active employees’ pensions have not risen in value since then.
At the heart of the issue is an estimated $800 million gap between assets held by the pension fund’s manager and the liabilities it faces. If U.S. dioceses don’t greatly increase their contributions to the benefit — and there appears to be little hope they will — then retirees who paid into the plan will receive substantially less money than they expected.
The dilemma is just the latest hit to a diocese that faces 153 claims of clergy sexual abuse, many dating back decades and involving priests who died long ago. Because the diocese responded by filing for Chapter 11 bankruptcy reorganization last summer, local Catholic churches stand to lose most or all the money their parishioners have contributed during years-long fundraising campaigns for special projects such as new church buildings.
Illinois-based nonprofit Christian Brothers Services has blamed the pension shortfall partly on financial losses originating with the Great Recession. It has also pointed to the fact that more people are drawing upon the benefit in retirement than there are parish workers and church school employees still paying into the plan.
National Catholic Register has reported Christian Brothers’ assets of about $1.55 billion represent only about 66% of what’s needed to cover pension payments. The news service noted those holdings fall well below the 80% benchmark often cited as a minimum for a healthy pension fund.
A representative of Christian Brothers, which according to the Register serves 40,000 employees across more than 180 member organizations, did not reply to a request for comment Tuesday.
Brennan’s letter emphasized the diocese has faithfully made all the contributions the plan requires. It added that the underfunding “is the result of actions or inactions by Christian Brothers and was not caused by the (Fresno-based diocese’s) pending bankruptcy proceedings.”
The diocese’s preferred solution would be to “spin off” the retirement plan from Christian Brothers and create its own plan, Brennan wrote in his Aug. 5 letter.
But it appears that won’t be possible, he said, because Christian Brothers indicated it would only cooperate if the diocese indemnifies the nonprofit against any accusations of wrongdoing. Doing so would disrupt the bankruptcy plan and, at any rate, a judge in the case probably would not approve of such a condition.
An alternative Brennan called the “only realistic option available to the Fresno Diocese” is to ask the bankruptcy court permission to withdraw from the Christian Brothers plan and create a new retirement plan. The Illinois nonprofit would continue administering the existing plan, subject to benefit reductions.
Such a withdrawal would likely lead Christian Brothers to file a claim against the diocese for millions of dollars, Brennan wrote, adding that an obligation of that size would be treated as a pre-bankruptcy claim by a general, unsecured creditor. That could suggest the amount the nonprofit recovers would likely be less money than it wants.
Brennan’s letter went on to note the diocese is working to establish a new benefits plan that will offer employees the opportunity to choose among options for how their retirement money will be invested.
He said the diocese expects in the future to share details of the new plan with those who have contributed to the retirement plan.
“Thank you for your patience and your prayers as we are called upon once again to overcome this most recent challenge facing the diocese,” he wrote.