Sex Abuse Costs Have Church Reeling
Dioceses Have Sold Land, Buildings to Settle Cases

The Associated Press
March 15, 2002

Sexual misconduct by Roman Catholic priests has cost the church in lost faith and broken lives. Yet the damage from the scandals has been financial as well as spiritual.

Dioceses have sold land and buildings to pay off multimillion-dollar settlements. Some have borrowed heavily from other dioceses or their own parishes. Insurers have limited coverage, while bishops have quietly paid thousands of dollars in therapy costs for abusive priests and their victims.

The nationwide financial toll of the wrongdoing is not known, since most settlements are confidential. Estimates of payouts to victims range from $300 million up to $1 billion.

Whatever the number, the experiences of individual dioceses indicate the impact has been significant — and could be similar in the Archdiocese of Boston, now struggling through the latest scandal.

The Diocese of Santa Rosa, Calif., had to sell property and take loans or donations of at least $7 million from about half the nation's 192 dioceses to help erase a $16 million debt related to sexual misconduct.

The Diocese of Dallas had to mortgage and sell property to pay $11 million that its insurance didn't cover in the more than $30 million settlement against pedophile and former priest Rudy Kos.

The Archdiocese of Santa Fe, N.M., was brought to the brink of bankruptcy, and had to borrow from parish savings accounts to pay more than $50 million to settle 40 abuse cases in the 1990s. The diocese settled a total of 165 such cases, but won't say how much it paid to resolve them.

The Diocese of Tucson, Ariz., says it likely will have to borrow money from a bank or from parish accounts to pay what insurers won't in a settlement reached last month. The amount of the settlement, in the case of four priests accused of molesting boys, has not been revealed.

"If there's any secret more well kept than the priest abusers it is the money that's paid out," said A. W. Richard Sipe, a psychotherapist and former priest who works with plaintiffs in sex abuse cases. "They're terribly frightened that the fund raising will drop."

That has not been the case in several dioceses. Many have seen steady or increased donations, even when lawsuits reveal damaging details.

Santa Rosa suspended its annual appeal in 1999, the year its bishop resigned, revealing a $16 million debt from overspending, bad investments and settlements in sexual misconduct cases.

The next year, the diocese scaled back fund-raising, but met its goal of $600,000 and exceeded the target the year after by about $300,000, Santa Rosa spokeswoman Dierdre Frontczak said.

Still, there were lingering ill effects. The Holy Family Elementary School in Lakeport, Calif., which relied heavily on diocese subsidies, had to close. Another school, St. Bernard in Eureka, quickly raised about $1.6 million to stay open. However, donors insisted a separate fund be created so the diocese would not have access to the money, said Edie Young, who was a school board member when the crisis hit.

In Dallas, diocese spokesman Bronson Havard said giving is strong and sometimes above normal there despite the 1990s case. Still, the controversy led administrators to postpone fund raising to build a high school and the project remains on hold due to the recession, Havard said.

The expenses don't end with the payouts.

Bishops customarily pay therapy costs for priests suspected of sexual misconduct. Counseling at institutes that treat clergy[36] costs up to $350 a day, with an average stay lasting between four and seven months, according to the Rev. Stephen Rosetti, a psychologist and consultant to the United States Conference of Catholic Bishops.

Several dioceses, including Santa Rosa and the Archdiocese of New Orleans, have also paid counseling costs for abuse victims. Such payments contributed to the huge deficit in Santa Rosa.

Insurers are seeking to limit their liability in sexual misconduct cases. In cases of large settlements, the insurer and the diocese usually end up in court over how much the policy covers. The dioceses' defense costs — which can be in the millions of dollars — often aren't fully covered by insurance.

Tucson Coadjutor Bishop Gerald Kicanas has said he was "disappointed" by the insurer's payout in that settlement, but released no specifics.

The financial strain comes at a difficult time for the church[50]. The slowing economy and population shifts have forced many dioceses to close parishes and schools.

Last fall, before the Massachusetts abuse case against the former Rev. John Geoghan gained national attention, Cardinal Bernard Law mandated a 30 percent spending cut in the Boston archdiocese, blaming a sagging economy.

The uproar over Geoghan intensified in January in the midst of Law's $300 million fund-raising campaign, when the cardinal acknowledged he had evidence that Geoghan molested boys, yet allowed the priest to continue to serve. The cardinal apologized. Geoghan faces more than 80 civil suits from people who say he abused them.

The Boston Globe reported the archdiocese has paid $15 million to settle lawsuits against Geoghan since 1997. Church officials estimate another 90 pending claims could cost an additional $25 million.

That, together with already settled and new claims, could bring the cost to more than $100 million, the Globe reported.

A February poll found nearly 20 percent of Catholics in the Boston archdiocese planned to stop giving, but church administrators said donations have been on track so far.

Attorney Sylvia Demarest, who represented plaintiffs in the Dallas case, said victims began seeking large settlements in the 1980s when criminal cases for the first time revealed abuse was a problem nationwide.

Demarest said the goal is not to take money from parishes and schools, but to get help for victims and force church leaders to do more to stop abuse.

"We're not at the end of this yet," she said.


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