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American Catholic Dioceses Survive Despite Abuse-Related Costs

The cost of clergy sex abuse for America's Roman Catholic Church has hit a breathtaking new benchmark: The massive settlement approved Monday in the Archdiocese of Los Angeles has pushed the price bey

The cost of clergy sex abuse for America's Roman Catholic Church has hit a breathtaking new benchmark: The massive settlement approved Monday in the Archdiocese of Los Angeles has pushed the price beyond $2 billion nationwide.

Yet predictions of massive parish closings and Catholic charities being shut down were wrong. Even in the five dioceses that took the unprecedented step of seeking bankruptcy protection from abuse claims, church leaders have found a way to fund the payouts and survive.

"No diocese has closed up shop," said Russell Shaw, a former spokesman for the U.S. Conference of Catholic Bishops and a writer on Catholic issues. "No chancery offices have ceased operations."

The bills for abuse cases are getting paid in some obvious and often more subtle ways.

Several dioceses have also sold off property, although the sales did not appear to take a direct toll on church ministries.

The Archdiocese of Boston, where the 2002 case of one accused priest triggered a nationwide crisis, sold its ornate bishop's mansion and 46 acres of property in Brighton. The Diocese of Covington, Ky., sold 226 acres used for retreats and other activities to help fund an $85 million deal.

But some of the land was being held in anticipation of future needs - for a school or parish that would serve a growing region. "Resources that are now going to pay off these settlements could have been devoted to worthy enterprises in the future," Shaw said. "When the future comes, those things will made clear."

Church analysts also see the scandal behind some recent cutbacks.

They say several bishops have trimmed diocesan staff and scaled back service programs so they can pay the settlements costs that insurers won't. Dioceses often end up taking insurers to court over coverage, since most claims involve cases that are decades old.

In the $660 million Los Angeles deal - easily the largest payout yet in the crisis - Cardinal Roger Mahony said the settlement will not have an impact on local ministries. He said he won't sell parish properties or schools to cover the cost, but the archdiocese will have to sell buildings, use some of its invested funds and borrow money.

The Los Angeles archdiocese will pay $250 million, insurers will pay $227 million and religious orders will chip in $60 million. The remaining $123 million will come from litigation with religious orders that chose not to participate in the deal, which a California judge approved Monday.

In court, some of the plaintiffs sobbed as the deal was formally approved and a moment of silence was held for others who had died during the years of negotiations. The attorney for the archdiocese, Michael Hennigan, appeared emotional as he told the court that his views of clergy sexual abuse changed during the years he spent meeting with victims and trying to work out an agreement.

In a few regions, parishioners - some willingly, others reluctantly - also agreed to kick in funds, mainly to avoid being forced to sell their parishes or schools.

Under a bankruptcy reorganization in the Diocese of Spokane, Wash., 82 parishes agreed to pay $10 million of a $48 million settlement with victims. The diocese is the smallest and poorest of five nationwide that filed for bankruptcy. The others are: Davenport, Iowa; San Diego; Tucson, Ariz., which has settled its cases, as has Portland, Ore.

None of the bankruptcy reorganizations so far have required dioceses to sell their parishes.

"I would not have guessed three years ago that the settlements would have come out this well," said Charles Zech, a Villanova University professor who researches church finances and has closely monitored the diocesan bankruptcies. "They haven't gotten to the core of their ministry. That's the important thing here."

Victim advocates note that dioceses' ability to fund the settlements challenges claims by church leaders that the lawsuits would destroy the church. Obviously, victims say, dioceses have enough wealth to make up for their years of failures to rein in predatory clergy. Few bishops release the kind of detailed budget reports that lay reform groups demanded when the scope of clergy wrongdoing came to light.

"They have a lot more resources than they've publicly acknowledged," said the Rev. Tom Doyle, a church insider turned victims' advocate who has advised prosecutors and plaintiffs' attorneys in Los Angeles and nationwide. "That's one of the things that all of this has demonstrated quite clearly."