March 3 - March 16, 2013

LENT, 2013: Archdiocesan finances in the life of the Church

Cardinal George’s Schedule

  1. March 3-16: College of Cardinals, Rome, Italy
Cardinal's Crest

Cardinal’s Appointments

Cardinal George approved the following clergy appointments Jan. 1, unless otherwise noted:

Rev. Paul Cao from sabbatical to associate pastor of St. Edward Parish, 4350 W. Sunnyside Ave.

Rev. Nicholas Desmond to parochial administrator of St. Stephen King of Hungry Parish, 2015 W. Augusta Blvd., while retaining his duties as pastor of St. Aloysius Parish, 2300 W. LeMoyne St.

Rev. Michael Enright to temporary administrator or St. Adalbert Parish, 1650 W. 17th St., while retaining his duties as pastor of St. Paul Parish, 2127 W. 22nd Place.

Rev. Ramil Fajardo from associate pastor at St. Clement Parish, 642 W. Deming Place, to judge on the Metropolitan Tribunal.

Rev. Thomas Kasputis from resident at St. Rene Goupil Parish, 6949 W. 63rd Place, to associate pastor of St. Agnes and St. Kieran Parishes, Chicago Heights.

Rev. Michal Lewon from associate pastor of St. Agnes Parish, Chicago Heights, to associate pastor at St. Christina, 11005 S. Homan Ave.

Rev. Marco Mercado from director of the Office for Hispanic Catholics to rector of the Shrine of Our Lady of Guadalupe, Des Plaines.

Rev. Donald Nevins to temporary administrator of Epiphany Parish, 2524 S. Keeler Ave., while retaining duties as pastor of St. Agnes of Bohemia, 2651 S. Central Park Ave.

Rev. John Rudnik from senior priest/resident at Transfiguration of Our Lord Parish, 2609 W. Carmen Ave., to temporary administrator of the same.

Rev. Alfredo Salera from pastor of Transfiguration of Our Lord Parish, 2609 W. Carmen Ave., to associate pastor of St. Simeon, Bellwood, effective Feb. 1.

Rev. Stanislaw Kuca from associate pastor of St. Elizabeth Seton Parish, Orland Hills, to temporary administrator of the same.

Rev. Luke Winkelmann from associate pastor of St. John Vianney, Northlake, to temporary administrator of the same.

Rev. Fernando Zuleta to temporary administrator of St. Roman Parish, 2311 S. Washtenaw Ave., while retaining his duties as associate pastor of Resurrection Parish, 3043 N. Francisco, effective Dec. 26,

Lent is a time for reviewing our lives and bringing all things to the Lord: most profoundly in the confessional, but also in other places where it helps our life with God and one another to set the record straight.

This column is about Archdiocesan finances.  Each year, an audited financial report is published and posted on the Archdiocesan website.  It serves as a model for the report that each pastor is to give once a year, after consulting with his finance council, to his parishioners.  This column, however, is a special report, given because of special circumstances.

Like so many other families and institutions, the Archdiocese of Chicago has suffered during the economic downturn of these past few years.  The Archdiocese remains a financially secure institution with a strong asset base.  To a great extent, this is because dedicated priests and religious take small salaries, and all those who give their lives and talents to the service of God’s people do so with great personal generosity and sacrifice.  The Archdiocese has sustained its services to society as well as to the Church in our schools and public institutions.  Supporting these good works, of which we should be justly proud, demands sound financial administration.  We cannot continue to work as if the effects of the recession were not being felt.

The Pastoral Center Operations of the Archdiocese comprise the central services that support parishes in their local ministries (e.g., the Office of Catechesis, Family Ministry, Peace and Justice and Respect Life offices, Young Adult Ministry), provide required administrative functions across the Archdiocese (e.g., finance, IT, legal services), and channel financial support to needy parishes and schools.   These central services do not include the operations of individual parishes or schools, Catholic Charities and its associated institutions (Misericordia, Mercy Home, Maryville) or Catholic Cemeteries.  The operating budget of the central services also does not include any payments related to misconduct nor any of the professional help given to victims of sexual abuse by priests or others in the Church.

Where, then, does the financial crunch show up?  Administrative Operations have run operating deficits of more than $30 million in each of the past four years.  Since this trend is unsustainable, I want to set out the measures we are taking to ensure prudent stewardship of our resources for years to come.

For the fiscal year ending June 2012, the Pastoral Center Operations of the Archdiocese had cash operating revenue of approximately $49 million to cover a total cash expense base of about $89 million, leading to a $40 million cash operating deficit for the year.   The revenue of the Pastoral Center consists primarily of parish assessments, the Annual Catholic Appeal donations, interest income and bequests.  Of the $89 million in expenses, approximately $47 million went to support the ministerial and administrative services of the Pastoral Center offices, and about $44 million went to support needy parishes and schools for their operating and capital needs; these expenses were offset by $2 million of net positive contributions from our related institutions (e.g., our seminaries, our Liturgical Training Publications group).  During these recessionary years, overall revenue has remained relatively flat.  Over this same time period, however, the expenses of the administrative offices and the aid to parishes and schools have both increased, with the largest increase coming from parish and school aid.  Of the total aid of $44 million in 2012, approximately $22 million went to support school operations, $4 million went to support church operations, and $18 million provided capital support for both churches and schools.  While providing aid to needy parishes and schools is basic to our shared Archdiocesan mission, we obviously cannot sustain funding at these levels.

Over the past several months, the Archdiocesan Finance Council, the Archdiocesan School Board, priest consultative bodies, and other constituencies across the Archdiocese have come together to understand the situation and to offer ideas.  We are grateful for their counsel and guidance.  We now believe we have a solid action plan in place to address our financial situation and eliminate our operating deficit entirely.  I want to share these plans and actions with you here.

1. Helping our Catholic schools become financially secure.

The Catholic school system of the Archdiocese of Chicago is an essential component of the mission of the Church here.  It contributes uniquely to the health and vitality of the Catholic Church and to the Chicago area community as a whole.  Catholic schools provide students with formation in the faith, strong academics and grounding in virtues that produce responsible members of society and citizens of God’s kingdom.  Our Archdiocesan School Board members, together with our superintendent, Sr. Mary Paul McCaughey, have worked for several months to develop a strategic plan to secure the system financially.  The key finance-related actions of the plan include: (1) using better practices in enrollment and fiscal management to improve operating results of parishes and schools that draw upon Archdiocesan subsidies; (2) creating a very large scholarship fund to make Catholic education more affordable to lower and middle income families; (3) establishing an even stronger partnership with the Big Shoulders Fund, which has been very helpful to us in keeping inner-city schools open and vibrant; and (4) making the difficult choices necessary to close or consolidate a few schools that are no longer sustainable, often for several reasons.

The strategic plan for our Catholic schools gives good hope that Catholic education will continue to be available throughout the Archdiocese.  Some schools need to close or be consolidated because of demographic changes or other challenges.  Over the past several months, decisions to close or consolidate 5 schools have been very carefully made.  School closings are disruptive to the communities affected, and we are working to assist school families during this transition period, particularly by offering scholarships for their children to attend nearby Catholic schools.

As we begin implementing our strategic plan, we are in final discussions with the Big Shoulders Fund, our longstanding partner, regarding a new and significant commitment.  Big Shoulders would provide new scholarship funding for each of the next three years, enabling many more lower-income children to attend our schools.  They would also bring additional resources to collaborate with us on programmatic and operational initiatives to improve the long-term viability of several inner-city schools.  The proposed, incremental contribution from Big Shoulders would be expected to directly reduce the aid required from the Archdiocese and enable us to prevent many school closures while implementation of the strategic plan gets underway.

More details on the strategic plan for Catholic schools will soon be made public; but we expect, through the efforts outlined above, to reduce the annual aid to schools from the Archdiocese by $10 million dollars next year, moving toward saving up to $20 million dollars over the next several years.  We hope to return to a sustainable level of aid for those schools that will always be facing financial difficulties.

2. Bringing new life to parishes that are not presently self-sufficient.

While operating grants to parochial schools are the most significant sort of aid to parishes, some parishes also require help to support church operations and parish capital needs.  The Pastoral Center is working closely with parishes to help them handle their financial needs in these difficult times.

Over the past two years, a Parish Transformation initiative has begun helping parishes to bring new life to their mission.  With cooperation from pastor and parishioners, the transformation program helps parish communities re-think their parish’s mission and ministries, work out measures to ensure greater financial stability and build more effective lay leadership in parish life.  Pastors in this initiative are finding it a valuable help in their ministry, and early financial results are positive.  We will continue to invest in this initiative, focused for now on the parishes most in need of help.  This Parish Transformation initiative should provide some short-term financial benefit and, more importantly, help our parishes ensure a long-term revitalization of their mission and finances.

In the short term, we are scaling back on capital loans and grants to parishes and laying out stricter criteria needed to qualify for such aid.  The Archdiocese provides capital support to parishes in the form of both loans and grants.  Going forward, we will need to approach this source of aid differently, to be sure it is always available when necessary.  We need to be more careful about the types of projects we can fund; we need to rely on parishes to pursue their own funding when possible; we need to adhere to stricter underwriting guidelines and to adhere more closely to budget.  There will likely be needs that are simply not fundable, and we will have to work with those parishes on alternative plans.

The efforts outlined above should lead to $13 to $15 million dollars in annual savings for the Archdiocese by fiscal year 2015.

3.  Reducing the costs of the Pastoral Center Operations of the Archdiocese.

Over the past several months, a thorough review of administrative expenses has helped us see more clearly the cost of Archdiocesan operations.  We have examined spending guidelines, vendor contracts and the services we provide relative to the costs we incur.  We have also consulted with our pastors and other constituents on the role of Pastoral Center Operations and the types of services that must be provided.

Administrative services provide the core functions required to operate the Archdiocese, such as financial administration, personnel services and legal affairs.  We have examined our ways of working and have identified actions we can take to scale back, work differently and make more effective use of our resources.  As we move forward, we will continue to explore further opportunities in this area to work more effectively and efficiently.

In the area of ministries, we will consolidate some agencies, bringing their number down from 16 to 9.  In particular, some ministries that implement Catholic social teaching, (i.e., Respect Life, Immigration, Peace & Justice, Kolbe House Jail Ministry), will come together as an Office of Human Solidarity and Dignity.  We will bring other services together into Ministry Formation Initiatives, focused on providing training and formation resources in collaboration with our field vicariates.  Going forward, we will serve particular ethnic communities largely through parish-based efforts and special Councils, with less staffing at the Pastoral Center.  Generally, we believe we will be able to provide effective service with fewer resources.

Inevitably, these changes in Pastoral Center Operations have led to a reduction in staff.  We have reduced staff by a total of 75 positions, 60 through a reduction in-force and 15 by not filling vacant positions.  Of the 75 positions, 55 were full-time staff.  Together, these reductions will create a workforce 14% smaller in the central services offices.  We are providing those affected by job eliminations with severance compensation and health insurance continuation to assist them in their transition.  We have also contracted for the services of an outplacement firm to assist employees in securing new positions.  Our employees are faith-filled men and women who have worked tirelessly for the good of the Church.  Please keep them in your prayers.

All the cost reductions outlined above in administrative operations will save approximately $11 to $13 million dollars annually by fiscal year 2015.


The deficits that have been incurred over the past several years do not include any payments related to misconduct.  Funding for misconduct settlements does not come from current contributions to parishes, to schools or to the Annual Catholic Appeal.  The Archdiocese designates the proceeds from sales of undeveloped property to pay misconduct expenses.

This review of Archdiocesan finances has been necessary but difficult.  Reductions in some services and in staffing will, of course, be particularly difficult for the persons and parishes directly affected by them.  These actions are being taken now because the financial situation imposes them.  We are also taking them, however, so that the Archdiocese will have the resources she needs for her mission, picking up the challenge of the New Evangelization and re-proposing the Gospel of Jesus Christ to future generations.  Our pastoral planning has identified many areas of opportunity: evangelizing our teens and young adults, forming parents in their faith along with their children, and ensuring a richer understanding among Catholics of our sacramental life.  By taking these difficult actions now, we will have created the financial flexibility needed to put “new wine” in “new wineskins” in the future.

I have often said that the generosity of Chicago Catholics is a constant testimony to the working of the Holy Spirit among us.  It is our greatest asset.  Generosity on the part of donors, however, requires responsibility on the part of those who manage our parishes and schools and the Archdiocese overall.

Lent is a good time for taking stock of one’s entire life.  Our life in Christ is shared.  I hope that sharing this overview of the Archdiocesan financial situation will encourage each of us to look at our lives and ask the Lord, who is never outdone in generosity, to shower us with his grace.  Many thanks to all of you, and God bless you.

Sincerely yours in Christ,
Francis Cardinal George, O.M.I.
Archbishop of Chicago