N.J. Diocese Bankruptcy Filing Creates Uncertainty | Editorial

South Jersey Times via
October 6, 2020

Amid the world-shaking news of recent days, the announcement that the Catholic Diocese of Camden has filed for Chapter 11 bankruptcy protection created fewer ripples than it might have at some other time.

This may well have played into the diocese’s desire for the faithful and the community to regard the event as a “nothing to see here; business as usual” one. After all, Americans have been busy sorting sort out another set of circumstances concerning the health of its president, where the smiley faces posted in official updates turned out not to be what they first seemed.

The diocese may not be hiding anything, but its statement works hard to emphasize that the reorganization would have no effect on: the 62 individual parishes in seven South Jersey counties; any diocese-associated Catholic schools in the region; any direct employees of the diocese, their salaries and their pensions; or the donations to, or work done by, the House of Charity-Bishop’s Annual Appeal, Catholic Strong or Catholic Charities.

As for what victims of what Bishop Dennis J. Sullivan refers to as “long-ago claims of (clergy) abuse,” that might be another matter. The bishop’s statement says the diocese had to pay $8 million in settlements just this year through the New Jersey Independent Victims Compensation Program, and that it had to borrow the money. There’s none left: “The Diocese does not have the resources to equitably and proportionally address further claims at this time.” Some 50 lawsuits are still awaiting resolution, the bishop states.

Sullivan said the combination of the disbursements and revenue dips from the COVID-19 suspension of in-person masses combined to make Chapter 11 “the best course of action.”

Since diocesan finances are almost as impenetrable as those of the president, it’ll be up to U.S. District Bankruptcy Court experts to unravel which assets and expenditures are within the filing’s scope, and which are not. Plaintiffs' attorneys in the sexual abuse cases likely think this is a stop-the-clock move designed to halt or delay or withhold payments to their clients.

For the 462,000 Catholics in the diocese, the bankruptcy cannot be welcome news after continuing waves of parish combinations and school shutdowns. Just this April, the diocese announced that five more schools including St. Joseph High School in Hammonton would be shutting their doors at the end of the 2019-2020 school year. (The St. Joseph site reopened last month as an independent Catholic school.)

How substantial is the firewall between the diocese’s directly owned assets, and the schools and individual churches? The diocese does not own any of the real estate held by the parishes and cannot be ordered to sell it, officials state. Members of those churches and of the local educational communities should try to keep a close watch on that, and the possible impact on any expenses that the diocese itself picks up.

Donors to church charities should not be dissuaded from their giving by the Chapter 11 filing. Contributions are needed more than ever since the pandemic began, both for local parishes and for helping the needy.

For some, the Camden Diocese’s fiscal predicament might recall the controversy over its 2013 acquisition of a $500,000 mansion in Woodbury as a residence and offices for the bishop, who had been living in the rectory.

Critics said the purchase was ill-advised at a time when schools and parishes were being shut. The 20-room, 6,000-square-foot Rugby Pines home has a heated pool and three-car garage. The home was sold by Rowan University, which, also controversially, had used it a residence for its president.

Could we be seeing “Back on the Market!” signs in the front yard soon? Stay tuned.

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