L.A., O.C. Roman Catholic Dioceses Brace for Budget Cuts

By William Lobdell
Los Angeles Times [California]
April 11, 2003

The Roman Catholic Diocese of Orange will slash spending about 20% beginning July 1 -- a step that will mean the elimination of jobs, program cutbacks and reduced aid for poor parishes, diocese officials said Thursday.

Church officials said the $2-million cut, coming on top of two 5% budget reductions in the last year, was prompted by the third straight year of poor investment returns coupled with rising costs such as insurance -- problems that have plagued dioceses across the nation in recent years.

The Los Angeles archdiocese also is planning spending cuts for the fiscal year that begins July 1, spokesman Tod Tamberg said. Though the amount has not been determined, plans include a hiring freeze and deep cuts in travel, conferences and discretionary spending. It's unclear if layoffs will be needed, Tamberg said.

In an effort to close a $4.3-million budget gap in September, Cardinal Roger M. Mahony eliminated seven church ministries, retrenched others and laid off at least 60 workers one week after the opening of the $189-million Cathedral of Our Lady of the Angels. In January, the archdiocese reported that the shortfall had tripled to $13.4 million, partly because of $7.7 million in one-time costs, much of it related to the sexual abuse scandal.

The Orange diocese also had made cuts, having recorded $28 million in red ink over the last two years and having depleted most of its reserves.

One of the chief reasons behind the church's money woes is a sagging economy that has reduced the investment income that dioceses had relied on for operating expenses. The Orange diocese, the second-largest diocese west of the Mississippi River, saw investment earnings plummet from $26 million in 1999-2000 to nothing last year.

"It's just like in regular industry," said Kenneth W. Korotky, chief financial officer for the U.S. Conference of Catholic Bishops. "We're not immune."

Though attorneys fees and settlements in molestation cases have contributed to the financial crises -- Orange has paid out $3.6 million over two years -- church officials in Southern California and most other dioceses report donations from the faithful have remained steady or increased despite the scandal.

Bishop of Orange Tod D. Brown said the latest cuts will mean reductions in staffing and programs at the diocesan headquarters. He hopes to avoid layoffs through voluntary departures and transfers to parish jobs.

But effects will trickle down to the county's 56 parishes and 41 schools, many of which will be asked to do work now handled by the diocese and do without subsidies from the bishop.

In a sign of tougher financial discipline, Brown met last week with four pastors of parishes in poor communities who he said were habitual deficit spenders and told them to balance their budgets.

"It's just clear that pastors can't operate with chronic deficits, and the [diocesan headquarters] can't either," said Brown, who authorized spending $12 million on critical needs at poor parishes over the last three years. "We have to adjust our budgets."

Pastor Bill Barman of Our Lady of La Vang in Santa Ana, one of the diocese's poorest parishes, said the bishop told him to pay back $50,000 that his congregation owes the diocese by the end of June or lay off his staff of two full-time employees and one part-timer.

"I told him, 'Bishop, I will debase myself in front of every pastor in the diocese and ask them for money before I fire my employees,' " said Barman, who already has persuaded a Rancho Santa Margarita parish to take up a collection for his assistants.

The priest said his working-class immigrant congregation of about 2,000 averages $3,200 in weekly donations, about $1,000 short of the parish's expenses -- a gap he says the parish can't make up on its own.

There's no place to cut his bare-bones budget, Barman said. He or volunteers already do the gardening, maintenance and cleaning. And with the poor economy, his minimum wage congregants can't give any more.

To help churches such as Our Lady of La Vang, two weeks ago the diocese launched a program that encourages affluent congregations to collect occasional offerings for their poorer brethren. A committee of clergy and laypeople will disperse the money to needy parishes.

But for Barman, that isn't enough for poor congregations constantly facing deficits.

"If this was Mexico, I'd have no problem with it," Barman said. "But this is Orange County."

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