Date: Friday, December 21, 2018
Source: The Catholic Spirit
The Archdiocese of St. Paul and Minneapolis’ Chapter 11 bankruptcy case was formally closed in U.S. Bankruptcy Court Dec. 21, three months after $210 million plan for Reorganization was approved by U.S. Bankruptcy Judge Robert Kressel Sept. 25.
Tom Abood, chairman of the archdiocese’s Reorganization Task Force and the Archdiocesan Finance Council, called the closure “the final signpost in a long journey that marks the end of one chapter in the history of the local Church and the beginning of a new day for us all.”
In January 2015, the archdiocese filed for bankruptcy protection in the wake of mounting claims of clergy sexual abuse dating back as far as the 1940s. Ultimately 453 claims were filed against the archdiocese during the claim-filing period, most of which were related to suits brought against the archdiocese during a three-year-lifting of the statute of limitations on child sexual abuse claims in Minnesota. In May 2018, the archdiocese announced it had reached a $210 million settlement.
In a Dec. 21 message to clergy and archdiocesan staff, Archbishop Hebda said he was sharing the news “with great gratitude.”
But while the judge’s action completed the legal proceedings, “our efforts to reach out to those hurt by people in the Church is just beginning and will continue indefinitely, along with our core commitment of creating and maintaining safe environments for all,” he said.
“Please know of my gratitude for your steadfast service during these challenging past four years,” he said to clergy and staff. “I ask you to join me in pausing during these final days of Advent and Christmas to pray for all survivors, their families and friends.”
As The Catholic Spirit previously reported, $170 million of the settlement is from insurance carriers, including $20 million from parish insurers. The archdiocese contributed $35 million from the sale of property, unrestricted cash, reserves not required to cover claims in its general insurance fund and benefits plan, board-designated funds and a pending estate settlement.
Nearly $3 million of the settlement came from voluntarily pledges from some parishes and priests. The plan includes a provision that ends all litigation against parishes arising from settlement claims.
The archdiocese will also pay $1 million annually for five years to the trust established for distributing funds to victims/survivors. A trustee appointed by the committee representing victims/survivors will determine the proportion of the funds each claimant will receive. A portion of the funds is expected to be distributed by year end.
“It’s the effort of many people, survivors, advisors and lay leaders to bring this result, which we are pleased to see finally achieved,” Abood said.
The Church, he said, will “move forward continuing to ensure a safe environment for children and serving the needs of the Catholics in this archdiocese.”