Archdiocese of New Orleans says parishes to be requested to help fund clergy ‘abuse settlements’

Archdiocese of New Orleans says parishes to be requested to help fund clergy ‘abuse settlements’

Dioceses Seek Settlement Trusts Amid Bankruptcy Challenges

Dioceses across the United States are advocating for creditors to consider accepting settlement trusts funded in part by all parishes within the dioceses. This approach is viewed as a preferable alternative to the complete liquidation of diocesan assets through Chapter 7 bankruptcy, which some creditors have pursued.

Efforts to Reduce Property Holdings

The Archdiocese of New Orleans is taking measures to reduce its property holdings. Factors such as soaring insurance rates and costly maintenance have strained the ability to maintain the more than 1,400 pieces of property owned by the archdiocese and its apostolates. This initiative also plays a pivotal role in determining the contributions requested from the apostolates.

Commitment to Settlement Trust Funding

Archbishop Gregory Aymond affirmed the archdiocese’s commitment to ensuring that a significant portion of the settlement trust is funded by the assets of the Archdiocese of New Orleans, including proceeds from real estate sales and contributions from insurers. These efforts are aimed at positioning the archdiocese for a more prepared and robust future.

Request for Prayers and Support

In his closing remarks, Archbishop Aymond expressed his daily prayers for the faithful of the Archdiocese of New Orleans and appealed for the community’s prayers for clergy, religious individuals, lay staff, and those involved in supporting the archdiocese during this challenging period. He humbly sought prayers for guidance from the Holy Spirit to lead the ongoing process to a just conclusion.

Bankruptcy Challenges Faced by U.S. Dioceses

Over two dozen U.S. dioceses, including two in U.S. overseas territories, have initiated bankruptcy proceedings, with the majority doing so in the past decade. The significant cost of settling abuse claims has been a primary factor leading many dioceses to declare bankruptcy.

Impact of Statute of Limitations “Revival”

In several U.S. states and territories where the statute of limitations on abuse claims has been temporarily “revived,” multiple Catholic dioceses have confronted bankruptcy due to a surge in new abuse claims during these “revival windows.” In New York, for example, six of the state’s eight dioceses have declared bankruptcy since the state opened a two-year window for old abuse claims in August 2019.

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