Milwaukee archdiocese to file for bankruptcy

Tue Jan 4, 2011 3:24pm EST
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By John Rondy

MILWAUKEE (Reuters) - Milwaukee's Roman Catholic archdiocese will file for bankruptcy, citing the financial drain from unresolved lawsuits brought by victims of sexual abuse by priests.

Archbishop Jerome Listecki said in a statement posted on the church's web site that the move to file for Chapter 11 reorganization grew out of a November court decision that insurance companies are not bound to contribute to financial settlements with victims.

Mediation efforts in many of the suits have failed, he added.

The aim is to pay pending claims by victims of abuse and "to continue to meet the needs of parishes, parishioners, and others who rely upon the Church for assistance," Listecki said in the statement.

Several U.S. Catholic dioceses have filed for bankruptcy since the Portland, Oregon, diocese took the drastic step in 2004. Dioceses that have entered bankruptcy because of sexual abuse claims include San Diego, California; Spokane, Washington; Wilmington, Delaware; and Davenport, Iowa.

In Milwaukee, the 185-year-old diocese said it had spent more than $29 million over two decades to cover the legal costs of priest abuse.

"Since 2002, we have sold property, liquidated savings and investments, eliminated ministries and services, cut archdiocesan staff by nearly 40 percent, and put all available real estate on the market in order to free up resources," settling nearly 200 cases, the church said on its web site.

The priest abuse scandal that first struck many U.S. dioceses a decade ago has cost the U.S. church in more ways than one.   Continued...