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Scandal Has Cost Church $250,495

Year's Spending Stemmed From Sex-Abuse Claims

Oct 25, 2002 | The Courier-Journal

In its first accounting of the financial impact of the clergy sex-abuse scandal, the Roman Catholic Archdiocese of Louisville says it spent $250,495 on legal fees, counseling for victims and public relations in its last fiscal year.

And costs for the current fiscal year, which began July 1, will be ''considerably higher,'' according to a report by Archbishop Thomas C. Kelly. The archdiocese faces almost 200 lawsuits, alleging sexual abuse by its priests and other workers.

The archdiocese published the figure in its annual financial report, which it distributed yesterday to each of the region's 68,000 Catholic households through its newspaper, The Record.

The report said that during the last fiscal year the archdiocese paid $154,913 in legal fees, $9,380 for counseling for victims and $86,202 for public relations, which included a mass mailing to local Catholics in June as well as the use of a public relations consultant.

The figures were released ''to be accountable about how funds have been used to address the problem of clergy sex abuse,'' Kelly said in the report.

While the report does not indicate the source of the money, all expenses related to sexual abuse were covered from archdiocesan investments, according to Brian Reynolds, chancellor and chief administrative officer of the archdiocese.

None of the payments were made by parish assessments, by donations to the annual Catholic Services Appeal fund drive or by insurance, although the archdiocese is investigating what costs might be covered by insurance, he said.

Kelly has promised that no money pledged during a current fund-raising drive the 2002 Catholic Services Appeal will go toward costs related to sexual abuse. He said such settlements will be paid out of investments and possibly insurance.

The financial report indicates the archdiocese had a $30.1 million budget for 2002 a figure that includes its core administrative costs, Catholic Charities, two high schools and other funds. It also shows that archdiocesan investments have suffered in the past year, declining in value to $61.8 million in June, from $68.5 million a year earlier. Reynolds attributed the decline to the overall drop in the stock market.

Since April, 195 people have sued the archdiocese, alleging sexual abuse by 26 current, former and deceased priests as well as by two religious brothers, two teachers and a volunteer. Kelly has permanently removed eight archdiocesan priests from ministry, three of whom currently face criminal charges.

The financial report ''is further evidence of our pledge we made last April to fully describe what we're doing as we go through this process,'' Reynolds said.

''It's really important that we describe the impact on this diocese,'' Reynolds said, adding that the financial report also includes a long-range strategic plan that makes a priority of helping victims of sexual abuse.

The archdiocese has previously said it does not plan to release figures on payments related to clergy sexual abuse for previous years.

But church spokeswoman Cecelia Price said yesterday that the church expects to release the dollar amounts it has paid in legal settlements it has reached with victims over the past 20 years.

It will be more difficult, she said, to calculate what portions of past years' legal costs were related to sexual abuse.

Documents released in the current litigation indicate that the archdiocese was involved in 13 legal settlements over the past 20 years with people who made allegations of sexual abuse against priests. None of those 13 cases was settled in the fiscal year that ended June 30, though two of them were settled in the current fiscal year.

The documents indicate the archdiocese paid at least $90,500 to settle three of the claims and loaned a priest money to settle a $142,661 claim. The archdiocese marked out the dollar amounts in the rest of the 13 cases.

Of the $86,202 that the archdiocese paid over the past year for communications and public relations, at least half of that covered the cost of mailing a report to each Catholic household in June, detailing the archdiocese's response to the sex-abuse crisis, Price said. Other costs including ''media monitoring and transcription services, and public relations counsel,'' the report said.

In his report, Kelly also said that ''about a dozen people'' are receiving counseling through a joint venture between the archdiocese and the University of Louisville's Kent School of Social Work. Under the program, the Kent School refers victims of clergy sexual abuse to counselors and the archdiocese pays the bills without learning their names.

The $9,380 in counseling costs paid last fiscal year do not include any of the cases handled through the Kent School, because the program began in July, Reynolds said.

Kelly said the Kent School program is a way to help those who don't want to approach the archdiocese directly or who cannot because they are suing the church.

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