On January 4, Archbishop Jerome Listecki announced the Archdiocese of Milwaukee will file for Chapter 11 bankruptcy protection. This news is the latest in a series of struggles the diocese has faced in the wake of the sexual abuse of minors by priests in the Milwaukee diocese. This decision was also influenced by recent unsuccessful settlement negotiations with victims and a court ruling that absolved the diocese’s insurance company from any financial liability in these cases.
Archbishop Listecki sums up the situation frankly: "As a result of the horrific actions of a few, there are financial claims pending against the archdiocese that exceed our means.”
The scandal surrounding abusive priests, and the questionable actions taken by some bishops to move priests accused or suspected of abuse, first surfaced around 2002. Since that time a firestorm has ensued and the repercussions have had devastating effects on dioceses around the nation. The Milwaukee Journal Sentinel reports that Milwaukee is the eighth Catholic diocese in the country to file for bankruptcy in the wake of the sexual abuse scandal. Others include Tucson, Arizona; Portland, Oregon; Spokane, Washington; Fairbanks, Alaska; Wilmington, Delaware; San Diego; and Davenport, Iowa.
In an effort to communicate what Chapter 11 bankruptcy protection means, the diocese has launched a comprehensive website and e-mail dedicated to the reorganization.
The website explains that the diocese has two goals moving forward:
In taking this action, there are two goals. First, the archdiocese wants to fairly compensate victims/survivors with unresolved claims – both those with claims pending and those who will come forward because of this proceeding. Second, the archdiocese wants to carry on the essential ministries of the archdiocese in order to continue to meet the needs of parishes, parishioners and others who rely upon the Church for assistance.
In financial information released by the dioceses, it reports having $98.4 million in total assets, including cemeteries, but indicates $90 million “are monies that do not belong to the archdiocese, are restricted for specific use as designated by donors, or are offset by a corresponding liability.” With other assets and liabilities, including Catholic social services and schools, the dioceses contends it has approximately $4.6 million in assets that could “be applied to a settlement in the current lawsuits pending against the Archdiocese of Milwaukee.”
Advocates for the victims, including David Clohessy from the Survivors Network of those Abused by Priests (SNAP), and attorney Jeff Anderson are unhappy with the decision. They claim that the reasons earlier settlement negotiations were unsuccessful was the diocese’s reluctance to release all documents pertaining to the abuse.
"This is about protecting church secrets, not church assets," said Clohessy. "The goal here is to prevent top church managers from being questioned under oath about their complicity, not 'compensating victims fairly.'"
It remains to be seen how, exactly, this decision could ultimately affect the diocese’s services, parishes, and schools. Challenges to the dioceses assets and ability to pay will be made in court as the bankruptcy case proceeds.