The Archdiocese of St. Paul and Minneapolis’ current financial difficulties are unlikely to affect St. Thomas directly, according to Mark Vangsgard, the university’s vice president of business affairs, but they may affect St. John Vianney College Seminary.
The archdiocese reported a $9.1 million operating deficit for fiscal year 2014 and reiterated Thursday that it is considering filing for bankruptcy as its financial condition has become more uncertain due to the growing potential for more lawsuits by victims of clergy sexual abuse.
According to Vangsgard, SJV is located on St. Thomas’ campus but is a related legal entity to the archdiocese. In addition to being a residence hall, SJV is a series of programs for undergraduate men who are considering the priesthood. SJV’s staff are employed by the archdiocese.
“There are employees of SJV – not of St. Thomas, but of SJV – that are part of the archdiocese,” Vangsgard said. “To the extent that the archdiocese wanted to stop the programming associated with the men in that program and cut back on employees, SJV employees that are in the building up there could be cut back on or the program could be eliminated.”
Vangsgard said that while cutbacks are possible, they are not a sure thing. The potential cutbacks will not affect St. Thomas, but Vangsgard said the brand of the university could be damaged.
“There’s certainly a Catholic brand that the university has, and to the extent that brand is not perceived as well by the public as a result of what’s going on in the archdiocese, you know, that may be an impact,” Vangsgard said. “We have not seen that yet in terms of enrollments or perceptions by incoming students or their parents.”
The archdiocese released its financial information in its newspaper, The Catholic Spirit, more than a week after it announced it was cutting its budget by 20 percent and making unspecified staff cuts. Archbishop John Nienstedt called the situation “disheartening,” but assured the faithful that the finances won’t directly affect parishes or other Catholic institutions.
“I am determined to see that the ministries and essential services provided by the Chancery Corporation will continue and that we will strive to minimize the impact of cutbacks on our Catholic people and the larger community,” he wrote.
The archdiocese said the operating deficit can be partly attributed to $4.1 million spent to address allegations of clergy sexual abuse since May 2013, when a three-year window opened up for abuse victims to file claims that were otherwise barred under the statute of limitations.
Chief Financial Officer Thomas Mertens said outside professionals were brought in to provide legal, investigative and financial expertise, and the majority of expenses were related to a review of priest files, investigation of insurance coverage and analyzing financial options.
Nienstedt said that since the statute of limitations was lifted, the archdiocese has settled two cases and 20 more trials are scheduled. Victims of past abuse still have about a year-and-a-half to pursue litigation.
“We have no idea how many more legal claims may be made against us in the time that is left,” Nienstedt said. Mertens added that the chancery has received a “significant number” of notices that claims will be filed.
The archdiocese has said previously that bankruptcy may be an option, and Mertens noted Thursday that officials haven’t decided yet if they will seek reorganization. But, he wrote, it is being considered with fairness to victims in mind.
“Importantly, the archdiocese would not use reorganization as a tool to avoid compensating victims/survivors. It would be a way to respond to all victims/survivors by allowing the available funds to be equitably distributed to all who have made claims, not just those who have the earliest trial dates or settlements,” Mertens wrote.
The archdiocese also explained how a potential reorganization would affect operations.
The Chancery Corp. would expect to be allowed to function as usual, and separately incorporated parishes and schools would not be part of a reorganization. The archdiocese said it’s premature to speculate on whether a bankruptcy filing would impact pensions, medical or other employee or priest benefits, but it would seek court approval to keep such plans going during the process.
Total operating revenue for the year ending June 30, 2014, was $25.5 million, compared with $32.7 million in 2013.
The Associated Press contributed to this report.
Was Fr. Becker even consulted for this article? I’m fairly certain there will be no staff cutback. There are only 6 priests (two who are part time) and three other employees (one who is part time) at SJV. I wouldn’t think it’d be an issue.
In order to even write an article as such, you have to recognize that SJV is supported by more than 20 dioceses around the country and that SJV is the building in which the archdiocese is able to educate and form the men that will be the future of the archdiocese. You have no authority to present your opinion on a public stage because you do not understand what the institution of SJV is represents, nor did you seek to understand it from a person of legitimate authority.
Yo, Miles. Just have a few questions for you:
A. There’s no opinion element of this article. It’s all fact with research by both TommieMedia and what appears to be the Associated Press (I read an article by that highly regarded outlet that was eerily similar—and by that I mean basically the same as this article minus the Vangsgard quotes—four days ago). Oops, that wasn’t a question. My bad.
B. While I don’t know if the seminary’s funded by other dioceses around the country, that could be true. But I can only imagine the archdiocese in which SJV is housed would be its major contributor. Another non-question. I’ll stick to what I promised.
C. I read the third paragraph as a pretty (and by that I mean perfect) explanation of what SJV is and how it functions. It seems that both the article’s author, the AP, Vangsgard and Nienstedt understand the institution quite well. Looks like that wasn’t a question either. Sorry.
D. Nienstedt is quoted. I’m wondering who else you’re seeking input from as a “person of legitimate authority.” Jesus? The Holy Spirit? Looks like I finally got to a couple questions in. But here’s a hint: they’re rhetorical.
E. Again, is this article published under the opinion tab? Looks like I got to my third question.
Stan,
The fact that this isn’t under the opinion tab is even worse, that means it is presented as fact. Considering they didn’t consult the seminary at all and this is all pure speculation, this is a case of extremely poor reporting. In addition to each sponsoring diocese, SJV has many donors that make its mission possible. You say Nienstedt is quoted, and who else would be an authoritative voice for SJV? The problem with that is he is not quoted in any way regarding SJV, the quote just says he is “disheartened”. Your mocking of Jesus and the Holy Spirit is not appreciated either. How would Mark Vangsgard even know anything about SJV’s financial situation is he is a University employee and SJV is not affiliated with the University in that way? TommieMedia should take back this article until a statement from Fr. Becker, who would know best about this, or someone who knows more about what they’re talking about, can be published.