As Benedict XVI, Joseph Ratzinger was head of the Catholic Church from 2005 to 2013. Using archival footage and conversations with contemporary witnesses, this film provides insight into the rise and fall of the German pope.
Once, it was said that the eyes were the windows to the soul. Now the cellphone is. Consider Jeffrey Burrill, a man who regularly logged in to the gay dating app Grindr and whose cellphone emitted signals marking his visits to gay bars and a Las Vegas gay bathhouse. Hardly a story there, you might say.
Except Jeffrey Burrill was Monsignor Jeffrey Burrill, the secretary-general of the United States Conference of Catholic Bishops. And his July 20 resignation was forced by a newly founded Catholic online newsletter using commercially available data to trace his calls, movements, and behavior since 2018.
The outing of a top administrator of the nation’s conference of Catholic bishops was clearly a story. But what kind? A story about high-tech surveillance and invasion of privacy? About a new breach of journalistic ethics? About the Catholic Church?
Much of the national attention to this unusual episode focused on privacy issues. The basic problem is not complicated. In principle, data from mobile devices are “anonymized” by substituting a unique numerical identifier for users’ names and phone numbers. But mobile-phone location information and app usage is often recorded. A sufficiently interested party, with some additional information about residences, workplaces, and other data points, can connect the dots (or in this case the pings) to tie specific devices to specific individuals, such as Burrill.
“There’s not much to stop similar spying on politicians, celebrities and just about anyone that’s a target of another person’s curiosity—or malice,” Maggie Gile noted in Newsweek. Senator Ron Wyden, an Oregon Democrat, recalls years of warnings that data harvested from phones could be used to track their users and “reveal the most personal details of their lives.” A “vast and largely unregulated” industry assured the public that the information it collected was anonymous, he says. “As this awful episode demonstrates, those claims were bogus.”
The difficulty of safeguarding privacy from invasive technology cries out for remedies. But as a journalist and a Catholic (who has covered and written extensively about religion), I am even more interested in the other two stories, about journalistic ethics and about the Catholic Church.
I can reasonably be ranked among those labeled liberal Catholics. I am on record arguing that the Church should thoroughly rethink its teachings on sexuality, including contraception, same-sex relationships, and priestly celibacy. But I have little patience for the thankfully few dismissals of Burrill’s “indiscretions” on the grounds that “we are all sinners.” We are indeed all sinners, but we are not all secretaries-general of the United States Conference of Catholic bishops. Those of us who make solemn promises, whether of priestly celibacy or marital fidelity, should keep them. All the more so when our vows bear directly on our public roles.
If Burrill was in fact regularly violating his public commitment and leading a double life, it does not pain me that he was forced from office. What does pain me is how that came about, setting, as it does, dangerous precedents for both journalism and Catholicism.
The Pillar, the online newsletter that outed Burrill, was founded last January by J. D. Flynn and Ed Condon, two Catholic crusaders for a purer Church. Its founding statement promised to uphold “the highest standards of journalistic independence and craftsmanship.” The newsletter’s reporting on Burrill, though, has prompted questions about whether it has lived up to that mission.
The Pillar story acknowledged that the data it had obtained contained “no evidence to suggest that Burrill was in contact with minors.” But from the opening paragraph, the story missed no opportunity to mention the Church’s sex-abuse scandal, charges that Grindr and other “hookup apps” are used to facilitate sex with minors, and unrelated cases here and abroad of such criminal behavior by priests. Responding to protests that the exposé dwelled on a homophobic stereotype of gay predators, Flynn and Condon went on Twitter the day after it was published to repeat that no evidence linked Burrill’s use of gay dating apps to minors, and that they had had no intention to “insinuate” otherwise. Fair enough, if you don’t consider devoting more than 1,100 words of a 2,900-word article to that kind of linkage an insinuation.
Criticism of The Pillar’s journalism did not end with complaints about its use of innuendo. The newsletter’s resort to an ethically disturbing, even if legal, high-tech method to expose private behavior was also clouded by unanswered questions. In their lengthy exposé, Flynn and Condon went into detail about how the hookup app’s signals indicated Burrill’s systematic violation of his vow of celibacy. But they were vague about the source of this data. “The data obtained and analyzed by The Pillar,” they wrote, “was obtained from a data vendor and authenticated by an independent data consulting firm contracted by The Pillar.”
Who was the data vendor? Were the data purchased or volunteered? How were they analyzed to pinpoint a particular individual? And who funded this possibly expensive process? To critics of The Pillar’s journalism, these are key questions. Relying on anonymous sources is legitimate, and sometimes necessary. But good journalism requires giving readers some indication of the reason for anonymity and what it might suggest about the source’s perspective or motives.
Questions about the data source are underlined by another article, published at 3 a.m. on July 19—one day before The Pillar’s July 20 exposé—by the Catholic News Agency (CNA), a similarly conservative outlet where Flynn and Condon had previously worked. Written by Alejandro Bermudez, the agency’s executive director, the story said that in 2018, CNA had been approached by someone claiming “to have access to technology capable of identifying clergy and others who download popular ‘hook-up’ apps.” The person’s aim, Bermudez wrote, was to save the Church from clergy engaged in scandalous conduct. Recognizing the potential for blackmail in such data, however, the source wanted to keep them from falling “into the wrong hands.” Bermudez met with the person, who named “high-profile Catholic personalities” that the technology identified. Nonetheless, Bermudez said, he distrusted the offer and turned it down.
This is a tantalizing story, and I phoned Bermudez about it. “Chatter” from friends, he told me, about a coming revelation of online activities by major Church figures had brought to mind the 2018 offer and moved him to rush out his account. “It was important for us to say as a news organization that from a Catholic journalists’ standpoint this was a dangerous door to open.” The 2018 offer, he explained, was not only for a “whole package” but for an ongoing relationship with a steady flow of information from the source. This was hardly an ordinary offer, I noted. Was it believable, as his story claimed, that Bermudez couldn’t recall the name of the person who made it and never mentioned it to Flynn, who was CNA’s editor in chief at the time? Bermudez did not budge from his previous explanation that “crazy” accusations against Church leaders were so commonplace that they were not a matter of conversation. Avoiding any mention of The Pillar, he was simply adamant about rejecting, in 2018 and today, this way to reform the Church.
In view of the CNA story, one naturally wonders whether its unnamed source is the same person who was anonymously peddling a pre-targeted and tailored data set, indeed a working relationship, in 2018. The Pillar won’t say. (I emailed the publication to ask for comment, but received no reply.)
There is another eyebrow-raising aspect of The Pillar’s successful identification of a single individual from a data set that might have begun with billions of signals from millions of users: It’s costly. It may require a team of researchers. Not everyone agrees, but several technical experts have estimated the cost at hundreds of thousands of dollars. One data expert, Zach Edwards, the founder of an analytics firm, even said millions.
This story has opened an entirely new, scorched-earth stage of the decades-long conflict between Catholic conservatives and liberals that began after the 1962–65 Second Vatican Council, simmered for decades, and has broken into civil war since the election of Pope Francis in 2013. The issues at stake in this struggle include changes in the liturgy authorized by the Council, questions about sexual morality that the Council never considered, and the relationship between the papacy and bishops around the globe. Should the priesthood continue to be open only to celibate males? What priority should the Church give to issues of personal, especially sexual, morality compared with those of social justice?
These debates are not new. But what was once jousting among theologians, intellectuals, and papal authorities, as the laity silently aligned themselves with one side or the other, has become a battle between Pope Francis and a phalanx of high-ranking bishops. In August 2018, the retired Vatican diplomat (and onetime Vatican ambassador to the U.S.) Archbishop Carlo Viganò even demanded that Francis resign.
When Flynn and Condon, both trained as canon lawyers—specialists in Church law—started The Pillar in January, they declared that the newsletter would be “independent of any ecclesial agenda but the holiness of the Church.” Yet their take on “the holiness of the Church” implies a definite “ecclesial agenda,” on which few concerns rank higher than sexual morality, at least as I read it. To Flynn and Condon, a major threat to that holiness is tolerance of homosexuality and homosexual conduct, particularly among the clergy and bishops.
For decades, Catholic ultraconservatives have charged that the Church’s American hierarchy was being manipulated by a gay cabal. The same note has been sounded by Archbishop Viganò, who extends this charge to include Vatican circles. In a different register, it has been sounded by gay advocates, including gay priests and ex-priests, who argue that the hidden lives compelled by the Church’s strictures against same-sex relations are responsible for grave pathologies among the clergy. Even some advocates of a married (heterosexual) priesthood have echoed something similar: The requirement of celibacy has made the Catholic priesthood a refuge for many gay men who have not come to terms with their sexuality.
For The Pillar, Burrill was no one-off. It had already taken its data set to the archdiocese of Newark, headed by Cardinal Joseph Tobin, a strong supporter of Pope Francis, and to the Vatican itself. The Pillar claimed that signals from both homosexual and heterosexual hookup apps going back to 2018 could be traced to “more than 10” Newark rectories and clerical residences, including “several” with a frequency indicating use by residents. (The Newark archdiocese has 212 parishes.) As for the Vatican, The Pillar reported that over six months in 2018, at least 32 mobile devices emitted signals from dating apps, including Grindr, within areas of Vatican City not accessible to the public. By The Pillar’s standards and my own very traditional ones, all these hookup efforts in Newark and Rome were regrettable, but whether their numbers should be considered extensive or whether they came from clergy or lay employees, the newsletter did not say.
One wonders if the bishops conference, like so many corporations confronting charges of sexual impropriety, might not enlist an independent investigator to shed light on the whole episode. Who, for example, promoted and vetted Burrill for his post? How did his quite extensive double life escape notice? It is an unnoted irony that Burrill was ordained in the diocese of La Crosse, Wisconsin, when its bishop was Raymond L. Burke, today an archbishop, a leading opponent to Pope Francis, and an outspoken advocate of Church teachings on homosexuality, divorce, and abortion. Nothing in Burrill’s subsequent career steps marked him as anything but a conventional doctrinal conservative.
Questions about Burrill are only the starting point. What are the implications for Catholicism if the traditional surveillance of theological ideas and pastoral practice by Church authorities is replaced by the high-tech surveillance of moral failings by freelance journalists? The implications for journalism and personal privacy are serious. Even the person peddling the surveillance technology back in 2018 recognized its potential for blackmail. Without either strong professional censure or legal regulation, tech-savvy and scoop-hungry reporters on the brawling frontiers of online journalism are likely to make this kind of personally invasive technology part of their tool kit. A thoroughgoing inquiry and report could be a service well beyond the Church.
Defenders of The Pillar’s actions have shrugged off these concerns about privacy, journalism, and the Church. Stephen P. White, of Catholic University and the Ethics and Public Policy Center, dismissed those “ticked off” by The Pillar’s reporting—including “data-security gurus, would-be gatekeepers of the journalistic guild,” and “the usual voices on Catholic social media who cry ‘homophobia’ every time it is suggested that an unnatural vice among clerics might be a problem worth addressing.” The real problem was that “ecclesially minded journalists like Flynn and Condon” were being treated as “pariahs” for exposing “inconvenient truths about clerical sins.” In the defenders’ confidence that no ominous red lines are being crossed here, they seem to be forgetting one fundamental component of the Catholic teaching to which The Pillar pledged itself at its founding: Original Sin.
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The Vatican has taken a highly unusual step against its neighbor, sending a diplomatic note to the Italian government that protests a draft law aimed at preventing hate and violence against LGBT people.
The complaint marks a formal effort by the Vatican to influence Italian lawmaking and could provide a test for how forcefully the church can exercise its clout on culture war issues — not just as a religion but as a state.
While it’s common for church figures to take stances on affairs in other countries — whether on same-sex marriage, LGBT rights or abortion — in this case the Vatican is invoking its prerogatives as a nation, arguing that the law, if passed, would violate the “concordat” that provides the framework for its relationship with Italy.
“Some current contents of the draft being debated by the Senate reduce the freedom granted to the Catholic Church,” the Vatican’s note said, according to the Corriere della Sera newspaper, which first reported the letter.
The Vatican’s press office confirmed that the city-state sent a note to the Italian ambassador to the Holy See last week but did not provide more details. Benedetto Della Vedova, an Italian foreign ministry undersecretary who has read the document, called the message “heavy interference” and said the Vatican city-state had not previously attempted to influence the Italian government on highly contentious issues such as abortion and divorce.
“The effects of this escalation aren’t positive for anyone,” Della Vedova said. He declined to share a copy of the letter with The Washington Post, but he described the core of the Vatican’s contention — that the draft law would violate specific aspects of the concordat dealing with religious freedom and freedom of expression. The Vatican’s goal is to have the draft bill amended.
The law, known as the Zan bill, after gay activist lawmaker Alessandro Zan, was approved last year by Italy’s lower house and has since been under debate in the Senate, amid fierce national discussion. The bill would explicitly categorize violence against LGBT people as a hate crime, making it akin to racial or antisemitic attacks, while establishing harsher penalties than those currently on the books.
Members of far-right political parties have said the legislation would suppress opinion. The leader of the far-right League, Matteo Salvini, said it would punish those “who think a mom is a mom and a dad is a dad.”
Advocates say that the law would merely put Italy in line with other Western European countries and provide belated safeguards after a series of murders and assaults targeting transgender people. According to Rainbow Europe, an LGBT association, Italy provides some of the weakest legal protections on the continent for LGBT people.
The explanation for that is based partly on the Catholic Church’s deep historical influence on Italy. When Italy was first considering granting legal rights to same-sex couples, the powerful Italian bishops’ conference sponsored protests, and Pope Benedict XVI helped lead a campaign to stop it. (When Italy approved civil unions in 2016, Pope Francis took a more hands-off approach.)
But even though Francis has at times signaled a more welcoming church stance on homosexuality, the church has not shifted its official teachings and laws. In March, the Vatican made explicit its position that priests cannot bless same-sex marriages. The church has also taken a clear stance on gender issues and said in 2019 that people do not have the right to choose their own gender.
The Zan law provides protection to people based on gender identity, among other factors.
Crux, a Catholic news outlet, noted Tuesday that Francis has called gender theory “dangerous” and an example of evil at work.
“It is an attack on difference, on the creativity of God and on men and women,” the pope said in a book released last year.
But supporters of the Italian bill say the Vatican, even if concerned about the changing cultural perception of sexuality and gender, should not feel threatened by the proposed law. They note that any viewpoint is protected, as long as it does not “incite a concrete danger of discriminatory or violent actions.” They also note that the law will not force any school — including private Catholic ones — to participate in events teaching about transphobia and homophobia.
“The worries here are absolutely groundless,” Zan, the lawmaker, said in a phone interview.
Gabriele Piazzoni, secretary general of Arcigay, Italy’s largest gay rights group, said the church was perhaps more worried about public opinion — and the fact that some Catholics disagree with church teaching. According to the Pew Research Center, 75 percent of Italians say homosexuality should be accepted, a proportion lower than in other Western European countries but slightly higher than in the United States.
“The dissonance I see is between this kind of behavior by the Vatican and the majority of the Catholic world and of Catholic public opinion,” Piazzoni said. “Maybe they are afraid that the [Catholic school] students, parents and teachers may be the ones asking to hold initiatives against discrimination or violence. There could be a groundswell of requests that they want to prevent at all costs.”
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By Derek Scally
On a sunny Sunday evening in May, 80 people gathered in a Berlin church for a calm Catholic revolution. At 6pm the 11 metre-high wooden doors of the modernist church of St Canisius were opened for an inclusive Mass of blessing. Spaced out in pairs around the airy church were mainly same-sex couples, all looking ahead at the lanky Jesuit priest.
With expectation in the air, Fr Jan Korditschke removed his face mask and, wearing a broad smile, spread his arms and invited all present to join him in celebrating love. His sermon drew on John’s Gospel, that love is from God, and that it is not in the purview of a priest or a pope to deny the God-given blessing of love.
“God is present in love and and loving couples are already blessed with the presence of God. I am just giving it a framework through this rite,” he said.
Afterwards, with two assistants Korditschke worked his way through the church, talked briefly to each couple before praying together. Behind medical masks many tears flowed.
“It was such a relief, like a stone was rolling away from my heart,” said one man, Georg, alongside his partner afterward.
The Berlin Mass was the last in a series of services across Germany under the banner #liebegewinnt – love wins. The services were triggered by a Vatican document from March restating Catholic teaching that homosexual acts are disordered and blessings for same-sex unions are impossible.
One attendee, Robert, said he came with his partner in protest at the document’s key sentence that “God does not and cannot bless sin”. “By posing a question no one asked, just to answer it in such cold language,” he said, “Rome tried to ram home its point but have triggered a reaction they didn’t expect.”
A few feet away 15 young men and one middle-aged woman held a large hand-written banner reading “God cannot bless sin” and recited the rosary during the Mass. One protester, who declined to give his name, said that obedience to papal teaching is what has held the Catholic Church together for two millennia.
“I worry that carry-on like this,” he said, with a nod to the emerging massgoers, “will bring us toward another schism.”
Exactly 500 years ago, the renegade Augustinian monk Martin Luther was ordered in public to submit to this absolute papal authority by recanting his claims of corrupt church practice and flawed teaching.
Luther turned the tables on Rome by demanding they prove that his scripture-based understanding of the Christian faith was false. The confrontation spiralled and his challenge became a channel for a host of political and modernising forces. Western Christianity split and the world was never the same again.
History doesn’t repeat itself; in a largely secular Europe, most people would struggle to spell schism, let alone see any relevance for their lives. Still, something is brewing in the land of the Reformation as individual protests within the church of Rome feed into each other to create a crackling, Catholic conflagration.
German bishops appear unsure like never before as to where their loyalties lie. Should they deploy the Roman fire blanket, suffocate the flames and denounce critics as arsonist apostates? Or does their survival hinge on embracing the protest and facing down Rome?
Like their Irish colleagues, the German bishops’ fumbled response to clerical sexual abuse allegations and their cover-up in the past decade has drained away credibility and public support.
Nowhere is the struggle more visible – or the stakes higher – than in the western city of Cologne. For centuries its hulking Gothic cathedral has been a touchstone of German Catholicism. For many German believers, though, Cologne is now the epicentre of institutional dysfunction and denial, in particular over the scale of clerical child abuse and the systematic nature of its cover-up.
Last year Cologne’s conservative archbishop, Cardinal Rainer Maria Woelki, came under fire for suppressing a report he himself commissioned into clerical sexual abuse. A replacement report followed this year and triggered two bishops’ departure, but critics say this document was careful to avoid any analysis of whether church structures were a contributory factor to abuse. Tensions continue to build.
In January a local priest, Klaus Koltermann, wrote to Cardinal Woelki, warning of “disquiet among the greatest believers” in his parish of Dormagen, 20 minutes north of Cologne. When a local newspaper reprinted his letter, Koltermann’s superiors warned of “possibly serious breaches of your service obligations . . . that could have consequences”.
The threat was withdrawn when the priest went public with their correspondence, a stand-off he describes as a learning experience. “A new solidarity has to grow amongst us,” he told The Irish Times. “We have to become more courageous. Sadly, we priests never learned to stand up for our faith – in the church.”
Such cases of conscience-led insubordination are gaining momentum. Two weeks ago Catholics at an ecumenical gathering with Germany’s Lutherans held joint eucharistic celebrations in defiance of their bishops.
This week a parish in Düsseldorf wrote to Cardinal Woelki disinviting him as celebrant at their confirmation Mass next month. Woelki once served as a deacon in the parish, as did two abusing priests. In their letter, some 140 parishioners said they feared the cardinal would “instrumentalise” their children’s confirmation to hit back at his critics.
“You are for us, sadly, no longer credible, we have lost our trust in you as a bishop,” they wrote.
Unlike in other countries, German Catholics have a clear way to express a vote of no-confidence with the Kirchenaustritt (church departure). All Christian church members in Germany automatically pay a so-called “church tax” in a system dating back to the 19th century, calculated at 8 per cent of their income tax. Effectively a membership fee, it earns Germany’s Catholic Church some ¤6 billion annually. Revoking the payment is seen as revocation of church membership.
The number of annual departures in 2019 was 218,000, twice the number of a decade ago. Numbers for 2020 have yet to be collated but, based on anecdotal evidence, the ongoing abuse debate has prompted an unprecedented rush for the exits.
Already facing a ticking demographic time bomb, Catholic bishops announced a “synodal process” in 2019 to discuss the road ahead. With 230 members (lay and religious) discussions are under way in four groups examining the role of priests, church power, sexuality and women in ministry. The pandemic shifted discussions online but organisers hope in-person gatherings can begin from September, with the first votes on proposals by Christmas.
For Bishop Georg Bätzing, head of the German episcopate, the “synodal path” is a balancing act between church liberals and traditionalists – with Rome looking on warily.
His relief was palpable this week when Pope Francis announced plans for a worldwide synodal consultation. This, said the German bishop, was proof that “we are neither schismatic nor do we as a German national church want to loosen ourselves from Rome”.
Expectations of the process are modest, however, given two emergency brakes built into the process: any decisions from the synodal path require unanimous backing of bishops, then approval from Rome.
Rather than wait for reform from within, Lisa Kötter began a church strike two years ago, out of which has grown a grassroots movement called Maria 2.0. Two years on, with regular protests and prayer services, Maria 2.0 has gone global with its demands for the inclusion of women in all church functions, an end to mandatory celibacy, and a consequential response to clerical sexual abuse.
“We see the entire patriarchal basis of the Catholic Church as wrong and not inclusive, out of step with the teaching of Jesus,” said Kötter.
It’s a measure of the movement’s effect that it already has a conservative countermovement, Maria 1.0. And, after initial icy silence, Kötter has been invited to private meetings with bishops. But the friendly conversation always reaches a dead end, she says, when conversation turns to the main bone of contention: church privileges and power that men claim for themselves.
With calls for women priests and blessing same-sex couples, Kötter and Fr Korditschke push back against the idea that they are part of a Luther 2.0 movement. Neither wants a break with Rome but, then again, neither did the man who became the face of the Reformation.
Korditschke says Germany’s Lutheran churches, with more liberal positions on women ministers and social questions, have raised expectations among local Catholics — and tensions when change comes slowly, or not at all.
“I look to Jesus, who was respectful of religious leaders and the sabbath but not afraid of conflict when it came to prioritising the good of people,” said Korditschke, who was baptised Lutheran, converted to Catholicism aged 16 and has no plans to return.
“I don’t see myself at odds with the Catholic Church and, unlike Martin Luther, I pray every day for the pope and serve my church. This is my home.”
After lighting a fuse in Germany two years ago, Kötter sees neither the structural means nor political appetite for reform among German Catholic bishops. She dismisses the synodal path as a “simulation”.
“They haven’t heard the sign of the times, the demands for change. Their ears are trained to hear nothing except their own hymns.”
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By REESE DUNKLIN and MICHAEL REZENDES
When the coronavirus forced churches to close their doors and give up Sunday collections, the Roman Catholic Diocese of Charlotte turned to the federal government’s signature small business relief program for more than $8 million.
The diocese’s headquarters, churches and schools landed the help even though they had roughly $100 million of their own cash and short-term investments available last spring, financial records show. When the cash catastrophe church leaders feared didn’t materialize, those assets topped $110 million by the summer.
“I am gratified to report the overall good financial health of the diocese despite the many difficulties presented by the Covid-19 pandemic,” Bishop Peter Jugis wrote in the diocese’s audited financial report released last fall.
As the pandemic began to unfold, scores of Catholic dioceses across the U.S. received aid through the Paycheck Protection Program while sitting on well over $10 billion in cash, short-term investments or other available funds, an Associated Press investigation has found. And despite the broad economic downturn, these assets have grown in many dioceses.
Yet even with that financial safety net, the 112 dioceses that shared their financial statements, along with the churches and schools they oversee, collected at least $1.5 billion in taxpayer-backed aid. A majority of these dioceses reported enough money on hand to cover at least six months of operating expenses, even without any new income.
The financial resources of several dioceses rivaled or exceeded those available to publicly traded companies like Shake Shack and Ruth’s Chris Steak House, whose early participation in the program triggered outrage. Federal officials responded by emphasizing the money was intended for those who lacked the cushion that cash and other liquidity provide. Many corporations returned the funds.
Overall, the nation’s nearly 200 dioceses, where bishops and cardinals govern, and other Catholic institutions received at least $3 billion. That makes the Roman Catholic Church perhaps the biggest beneficiary of the paycheck program, according to AP’s analysis of data the U.S. Small Business Administration released following a public-records lawsuit by news organizations. The agency for months had shared only partial information, making a more precise analysis impossible.
Already one of the largest federal aid efforts ever, the SBA reopened the Paycheck Protection Program last month with a new infusion of nearly $300 billion. In making the announcement, the agency’s administrator at the time, Jovita Carranza, hailed the program for serving “as an economic lifeline to millions of small businesses.”
Church officials have said their employees were as worthy of help as workers at Main Street businesses, and that without it they would have had to slash jobs and curtail their charitable mission as demand for food pantries and social services spiked. They point out the program’s rules didn’t require them to exhaust their stores of cash and other funds before applying.
But new financial statements several dozen dioceses have posted for 2020 show that their available resources remained robust or improved during the pandemic’s hard, early months. The pattern held whether a diocese was big or small, urban or rural, East or West, North or South.
In Kentucky, funds available to the Archdiocese of Louisville, its parishes and other organizations grew from at least $153 million to $157 million during the fiscal year that ended in June, AP found. Those same offices and organizations received at least $17 million in paycheck money. “The Archdiocese’s operations have not been significantly impacted by the Covid-19 outbreak,” according to its financial statement.
In Illinois, the Archdiocese of Chicago had more than $1 billion in cash and investments in its headquarters and cemetery division as of May, while the faithful continued to donate “more than expected,” according to a review by the independent ratings agency Moody’s Investors Service. Chicago’s parishes, schools and ministries accumulated at least $77 million in paycheck protection funds.
Up the interstate from Charlotte in North Carolina, the Raleigh Diocese collected at least $11 million in aid. Yet during the fiscal year that ended in June, overall offerings were down just 5% and the assets available to the diocese, its parishes and schools increased by about $21 million to more than $170 million, AP found. In another measure of fiscal health, the diocese didn’t make an emergency draw on its $10 million line of credit.
Catholic leaders in dioceses including Charlotte, Chicago, Louisville and Raleigh said their parishes and schools, like many other businesses and nonprofits, suffered financially when they closed to slow the spread of the deadly coronavirus.
Some dioceses reported that their hardest-hit churches saw income drop by 40% or more before donations began to rebound months later, and schools took hits when fundraisers were canceled and families had trouble paying tuition. As revenues fell, dioceses said, wage cuts and a few dozen layoffs were necessary in some offices.
Catholic researchers at Georgetown University who surveyed the nation’s bishops last summer found such measures weren’t frequent. In comparison, a survey by the investment bank Goldman Sachs found 42% of small business owners had cut staff or salaries, and that 33% had spent their personal savings to stay open.
Church leaders have questioned why AP focused on their faith following a story last July, when New York Cardinal Timothy Dolan wrote that reporters “invented a story when none existed and sought to bash the Church.”
By using a special exemption that the church lobbied to include in the paycheck program, Catholic entities amassed at least $3 billion — roughly the same as the combined total of recipients from the other faiths that rounded out the top five, AP found. Baptist, Lutheran, Methodist and Jewish faith-based recipients also totaled at least $3 billion. Catholics account for about a fifth of the U.S. religious population while members of Protestant and Jewish denominations are nearly half, according to the Pew Research Center.
Catholic institutions also received many times more than other major nonprofits with charitable missions and national reach, such as the United Way, Goodwill Industries and Boys & Girls Clubs of America. Overall, Catholic recipients got roughly twice as much as 40 of the largest, most well-known charities in America combined, AP found.
The complete picture is certainly even more lopsided. So many Catholic entities received help that reporters could not identify them all, even after spending hundreds of hours hand-checking tens of thousands of records in federal data.
The Vatican referred questions about the paycheck program to the United States Conference of Catholic Bishops, which said it does not speak on behalf of dioceses.
Presented with AP’s findings, bishops conference spokeswoman Chieko Noguchi responded with a broad statement that the Paycheck Protection Program was “designed to protect the jobs of Americans from all walks of life, regardless of whether they work for for-profit or nonprofit employers, faith-based or secular.”
The AP’s assessment of church finances is among the most comprehensive to date. It draws largely from audited financial statements posted online by the central offices of 112 of the country’s nearly 200 dioceses.
The church isn’t required to share its financials. As a result, the analysis doesn’t include cash, short-term assets and lines of credit held by some of the largest dioceses, including those serving New York City and other major metropolitan areas.
The analysis focused on available assets because federal officials cited those metrics when clarifying eligibility for the paycheck program. Therefore, the $10 billion AP identified doesn’t count important financial pillars of the U.S. church. Among those are its thousands of real estate properties and most of the funds that parishes and schools hold. Also excluded is the money — estimated at $9.5 billion in a 2019 study by the Delaware-based wealth management firm Wilmington Trust — held by charitable foundations created to help dioceses oversee donations.
In addition, dioceses can rely on a well-funded support system that includes help from wealthier dioceses, the bishops conference and other Catholic organizations. Canon law, the legal code the Vatican uses to govern the global church, notes that richer dioceses may assist poorer ones, and the AP found instances where they did.
In their financial statements, the 112 dioceses acknowledged having at least $4.5 billion in liquid or otherwise available assets. To reach its $10 billion total, AP also included funding that dioceses had opted to designate for special projects instead of general expenses; excess cash that parishes and their affiliates deposit with their diocese’s savings and loan; and lines of credit dioceses typically have with outside banks.
Some church officials said AP was misreading their financial books and therefore overstating available assets. They insisted that money their bishop or his advisers had set aside for special projects couldn’t be repurposed during an emergency, although financial statements posted by multiple dioceses stated the opposite.
For its analysis, AP consulted experts in church finance and church law. One was the Rev. James Connell, an accountant for 15 years before joining the priesthood and becoming an administrator in the Milwaukee Archdiocese. Connell, also a canon lawyer who is now retired from his position with the archdiocese, said AP’s findings convinced him that Catholic entities did not need government aid — especially when thousands of small businesses were permanently closing.
“Was it want or need?” Connell asked. “Need must be present, not simply the want. Justice and love of neighbor must include the common good.”
Connell was not alone among the faithful concerned by the church’s pursuit of taxpayer money. Parishioners in several cities have questioned church leaders who received government money for Catholic schools they then closed.
Elsewhere, a pastor in a Western state told AP that he refused to apply even after diocesan officials repeatedly pressed him. He spoke on condition of anonymity because of his diocese’s policy against talking to reporters and concerns about possible retaliation.
The pastor had been saving, much like leaders of other parishes. When the pandemic hit, he used that money, trimmed expenses and told his diocese’s central finance office that he had no plans to seek the aid. Administrators followed up several times, the pastor said, with one high-ranking official questioning why he was “leaving free money on the table.”
The pastor said he felt a “sound moral conviction” that the money was meant more for shops and restaurants that, without it, might close forever.
As the weeks passed last spring, the pastor said his church managed just fine. Parishioners were so happy with new online Masses and his other outreach initiatives, he said, they boosted their contributions beyond 2019 levels.
“We didn’t need it,” the pastor said, “and intentionally wanted to leave the money for those small business owners who did.”
WEATHERING A DOWNTURN
Months after the pandemic first walloped the economy, the 112 dioceses that release financial statements began sharing updates. Among the 47 dioceses that have thus far, the pandemic’s impact was far from crippling.
The 47 dioceses that have posted financials for the fiscal year that ended in June had a median 6% increase in the amount of cash, short-term investments and other funds that they and their affiliates could use for unanticipated or general expenses, AP found. In all, 38 dioceses grew those resources, while nine reported declines.
Finances in Raleigh and 10 other dioceses that took government assistance were stable enough that they did not have to dip into millions they had available through outside lines of credit.
“This crisis has tested us,” Russell Elmayan, Raleigh’s chief financial officer, told the diocese’s magazine website in July, “but we are hopeful that the business acumen of our staff and lay counselors, together with the strategic financial reserves built over time, will help our parishes and schools continue to weather this unprecedented event.” Raleigh officials did not answer direct questions from AP.
The 47 dioceses acknowledged a smaller amount of readily available assets than AP counted, though by their own accounting that grew as well.
The improving financial outlook is due primarily to parishioners who found ways to continue donating and U.S. stock markets that were rebounding to new highs. But when the markets were first plunging, officials in several dioceses said, they had to stretch available assets because few experts were forecasting a rapid recovery.
In Louisville, Charlotte and other dioceses, church leaders said they offered loans or grants to needy parishes and schools, or offset the monthly charges they assess their parishes. In Raleigh, for example, the headquarters used $3 million it had set aside for liability insurance and also tapped its internal deposit and loan fund.
Church officials added that the pandemic’s full toll will probably be seen in a year or two, because some key sources of revenue are calculated based on income that parishes and schools generate.
“We believe that we will not know all of the long-term negative impacts on parish, school and archdiocesan finances for some time,” Louisville Archdiocese spokeswoman Cecelia Price wrote in response to questions.
At the nine dioceses that recorded declines in liquid or other short-term assets, the drops typically were less than 10%, and not always clearly tied to the pandemic.
The financial wherewithal of some larger dioceses is underscored by the fact that, like publicly traded companies, they can raise capital by selling bonds to investors.
One was Chicago, where analysts with the Moody’s ratings agency calculated that the $1 billion in cash and investments held by the archdiocese headquarters and cemeteries division could cover about 631 days of operating expenses.
Church officials in Chicago asserted that those dollars were needed to cover substantial expenses while parishioner donations slumped. Without paycheck support, “parishes and schools would have been forced to cut many jobs, as the archdiocese, given its liabilities, could not have closed such a funding gap,” spokeswoman Paula Waters wrote.
Moody’s noted in its May report that while giving was down, federal aid had compensated for that and helped leave the archdiocese “well positioned to weather this revenue loss over the next several months.” Among the reasons for the optimism: “a unique credit strength” that under church law allows the archbishop to tax parish revenue virtually at will.
In a separate Moody’s report on New Orleans, which filed for bankruptcy in May while facing multiple clergy abuse lawsuits, the ratings agency wrote in July that the archdiocese did so while having “significant financial reserves, with spendable cash and investments of over $160 million.”
Moody’s said the archdiocese’s “very good” liquid assets would let it operate 336 days without additional income. Those assets prompted clergy abuse victims to ask a federal judge to dismiss the bankruptcy filing, arguing the archdiocese’s primary reason for seeking the legal protection was to minimize payouts to them.
The archdiocese, along with its parishes and schools, collected more than $26 million in paycheck money. New Orleans Archdiocesan officials didn’t respond to written questions.
Without special treatment, the Catholic Church would not have received nearly so much under the Paycheck Protection Program.
After Congress let nonprofits and religious organizations participate in the first place, Catholic officials lobbied the Trump Administration for a second break. Religious organizations were freed from the so-called affiliation rule that typically disqualifies applicants with more than 500 workers.
Without that break, many dioceses would have missed out because — between their head offices, parishes, schools and other affiliates — their employee count would exceed the limit.
Among those lobbying, federal records show, was the Los Angeles Archdiocese. Parishes, schools and ministries there collected at least $80 million in paycheck aid, at a time when the headquarters reported $658 million in available funds heading into the fiscal year when the coronavirus arrived.
Catholic officials in the U.S. needed the special exception for at least two reasons.
Church law says dioceses, parishes and schools are affiliated, something the Los Angeles Archdiocese acknowledged “proved to be an obstacle” to receiving funds because its parishes operate “under the authority of the diocesan bishop.” Dioceses, parishes, schools and other Catholic entities also routinely assert to the Internal Revenue Service that they are affiliated so they can maintain their federal income tax exemption.
While some Catholic officials insisted their affiliates are separate and financially independent, AP found many instances of borrowing and spending among them when dioceses were faced with prior cash crunches. In Philadelphia, for example, the archdiocese received at least $18 million from three affiliates, including a seminary, to fund a compensation program for clergy sex abuse survivors, according to 2019 financial statements.
Cardinals and bishops have broad authority over parishes and the pastors who run them. Church law requires parishes to submit annual financial reports and bishops may require parishes to deposit surplus money with internal banks administered by the diocese.
“The parishioners cannot hire or fire the pastor; that is for the bishop to do,” said Connell, the priest, former accountant and canon lawyer. “Each parish functions as a wholly owned subsidiary or division of a larger corporation, the diocese.”
Bishops acknowledged a concerted effort to tap paycheck funds in a survey by Catholic researchers at Georgetown University. When asked what they had done to address the pandemic’s financial fallout, 95% said their central offices helped parishes apply for paycheck and other aid — the leading response. That topped encouraging parishioners to donate electronically.
After Congress approved the paycheck program, three high-ranking officials in New Hampshire’s Manchester Diocese sent an urgent memo to parishes, schools and affiliated organizations urging them to refrain from layoffs or furloughs until completing their applications. “We are all in this together,” the memo read, adding that diocesan officials were working expeditiously to provide “step by step instructions.”
Paycheck Protection Program funds came through low-interest bank loans, worth up to $10 million each, that the federal government would forgive so long as recipients used the money to cover about two months of wages and operating expenses.
After an initial $659 billion last spring, Congress added another $284 billion in December. With the renewal came new requirements intended to ensure that funds go to businesses that lost money due to the pandemic. Lawmakers also downsized the headcount for applicants to 300 or fewer employees.
A QUESTION OF NEED
In other federal small business loan programs, government help is treated as a last resort.
Applicants must show they couldn’t get credit elsewhere. And those with enough available funds must pay more of their own way to reduce taxpayer subsidies.
Congress didn’t include these tests in the Paycheck Protection Program. To speed approvals, lenders weren’t required to do their usual screening and instead relied on applicants’ self-certifications of need.
The looser standards helped create a run on the first $349 billion in paycheck funding. Small business owners complained that they were shut out, yet dozens of companies healthy enough to be traded on stock exchanges scored quick approval.
As blowback built in April, Treasury Secretary Steven Mnuchin warned at a news briefing that there would be “severe consequences” for applicants who improperly tapped the program.
“We want to make sure this money is available to small businesses that need it, people who have invested their entire life savings,” Mnuchin said. Program guidelines evolved to stress that participants with access to significant cash probably could not get the assistance “in good faith.”
Mnuchin’s Treasury Department said it would audit loans exceeding $2 million, although federal officials have not said whether they would hold religious organizations and other nonprofits to the same standard of need as businesses.
The headquarters and major departments for more than 40 dioceses received more than $2 million. Every diocese that responded to questions said it would seek to have the government cover the loans, rather than repay the funds.
One diocese receiving a loan over $2 million was Boston. According to the archdiocese’s website, its central ministries office received about $3 million, while its parishes and schools collected about $32 million more.
The archdiocese — along with its parishes, schools and cemeteries — had roughly $200 million in available funds in June 2019, according to its audited financial report. When that fiscal year ended several months into the pandemic, available funds had increased to roughly $233 million.
Nevertheless, spokesman Terrence Donilon cited “ongoing economic pressure” in saying the archdiocese will seek forgiveness for last year’s loans and will apply for additional, new funds during the current round.
Beyond its growing available funds, the archdiocese and its affiliates benefit from other sources of funding. The archdiocese’s “Inspiring Hope” campaign, announced in January, has raised at least $150 million.
And one of its supporting charities — the Catholic Schools Foundation, where Cardinal Sean O’Malley is board chairman — counted more than $33 million in cash and other funds that could be “used for general operations” as of the beginning of the 2020 fiscal year, according to its financial statement.
Despite these resources, the archdiocese closed a half-dozen schools in May and June, often citing revenue losses due to the pandemic. Paycheck protection data show four of those schools collectively were approved for more than $700,000.
The shuttered schools included St. Francis of Assisi in Braintree, a middle-class enclave 10 miles south of Boston, which received $210,000. Parents said they felt blindsided by the closure, announced in June as classes ended.
“It’s like a punch to the gut because that was such a home for so many people for so long,” said Kate Nedelman Herbst, the mother of two children who attended the elementary school.
Along with more than 2,000 other school supporters, Herbst signed a written protest to O’Malley that noted the archdiocese’s robust finances. After O’Malley didn’t reply, parents appealed to the Vatican, this time underscoring the collection of Paycheck Protection Program money.
“It is very hard to reconcile the large sums of money raised by the archdiocese in recent years with this wholesale destruction of the church’s educational infrastructure,” parents wrote.
In December, the Vatican turned down their request to overrule O’Malley. Spokesman Donilon said the decision to close the school “is not being reconsidered.”
Today, the three children of Michael Waterman and his wife, Jeanine, are learning at home. And they still can’t understand why the archdiocese didn’t shift money to help save a school beloved by the faithful.
“What angers us,” Michael Waterman said, “is that we feel like, given the amount of money that the Catholic Church has, they absolutely could have remained open.”
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