The Archdiocese of Portland, Ore., was the first to file for Chapter 11 reorganization in July 2004. According to Bud Bunce, communications director for the archdiocese, many people were surprised at the time and had questions, because it was unknown territory.

“I don’t know that most of the people understood just how dire our financial situation was, even though the archbishop (John G. Vlazny) had tried to make that very clear to them. I think people were very concerned about the possibility of losing their parish, their churches, their schools.”

But “life went on,” he said, explaining that people continued to attend Mass, support the ministries within the parishes and schools and contribute to the annual appeal.

Because the archbishop held property in trust for the parishes, the Portland Archdiocese, home to approximately 390,000 Catholics, was challenged to work out church property ownership, Bunce said.

“As part of our settlement and reorganization as an archdiocese, each of our individual parishes has since been incorporated as separate entities in and of themselves,” he said.

Bunce said the people of Portland were resilient throughout the process of the reorganization, which ended in April 2007 with a federal judge’s approval of a $75 million settlement of clergy sexual abuse claims and a financial reorganization plan. “Your archbishop is going to need their prayers (as) much as or more than he has in the past, so I would hope they would keep him in their prayers,” Bunce said when asked for advice to offer Catholics in the Milwaukee Archdiocese, “and at the same time, help their parish pastors to keep the life of the church running in the parishes there.”
Fred Allison, communications director for the Diocese of Tucson, Ariz., said parishioners responded with “a great deal of empathy for the victims and for their own church,” when, in September 2004, the diocese became the second in the nation to file for Chapter 11 reorganization.
“One thing that Bishop (Gerald F.) Kicanas did, prior to filing for the Chapter 11 and throughout the entire process, was to invite people to tell him what they were thinking and feeling, and, overwhelmingly, in terms of letters, phone calls, e-mails, the response of Catholics in the Diocese of Tucson to the decision to file for Chapter 11 reorganization was positive and supportive,” Allison said, noting that the people’s generosity to their parishes, to the diocese and in the annual Catholic appeal was “extraordinary.”
He also said that Bishop Kicanas’ constant and consistent communication of the reason for the decision and the goals, were key to its success: “…to seek the best possible way to heal as many of the victims and to continue the mission of the diocese,” noting that the annual Catholic appeal in 2005 experienced a dramatic increase from 2004. Subsequent appeals also increased, and the major renewal campaign the diocese had in 2008, with a $28 million goal, was exceeded by more than $10 million in pledges, he said.

Like Bunce, Allison mentioned the importance of prayer.p.5bankruptOlga Caley of Rio Rico, Ariz., stops to say a prayer at the statue of the Virgin Mary outside the Cathedral of St. Augustine in Tucson Sept. 20, 2004, after learning the diocese filed for federal bankruptcy protection. Tucson was the second diocese in the nation to seek court-supervised reorganization under Chapter 11 of the U.S. Bankruptcy Code to resolve multimillion-dollar claims against it by alleged victims of childhood molestation by priests. (CNS file photo by Francisco Medina)
“The bishop also said it is so important that throughout the process that we all pray for the people who are involved in the process – that means the judge and the attorneys, the victims and our own diocese,” Allison said. “So, the bishop wrote a special prayer that we all prayed throughout the process of the Chapter 11, because prayer is so important. It’s a legal process, it’s a financial process, but, also, it’s a spiritual process….”

The Tucson Diocese, comprised of more than 350,000 Catholics, emerged from its Chapter 11 reorganization in July 2005 after the bankruptcy court approved a $22.2 million settlement with sex abuse claimants. While Allison said Archbishop Listecki probably has the best advice for people in the Milwaukee Archdiocese, he also said that Bishop Kicanas likened what was happening in their diocese to a storm, and that image helped the people better understand.

“That when there is a storm, you need shelter, you look for shelter, and, seeking shelter, seeking a way to protect yourself from a storm is what you should do,” Allison said, “and in the instance of trying to provide equitable, fair and as much healing to as many victims as possible, not just those who are represented by attorneys and/or who have filed civil suits, that the emphasis has to be – the focus – has to be on healing, and so Catholics can take heart, be heartened by, can be encouraged by the focus of the Chapter 11 on healing and continuing the mission of the church.”

Bishop Kicanas said that only after extensive consultation and discussions with priests and people in the Diocese of Tucson, did they make the “painful and difficult decision” to file for Chapter 11 reorganization.
“It’s one that you make with a level of fear, and because of the unknown, but clearly I believe it was the best way to fairly and equitably compensate those people who had been harmed,” Bishop Kicanas said.

“The parish life, the Catholic schools will continue – there’s always fear that somehow the Catholic Church will have to close down – and, obviously, our worship and our service and our commitment to the littlest and weakest in the community will continue,” he said.

Bishop Kicanas said he has confidence in Archbishop Listecki, whom he called a “very pastoral man, a man of deep sensitivity.”
“I’m sure that he understands that while this is a legal process, it’s also a pastoral moment to be available where possible, to speak with victims, to listen to their hurt and to their pain, to listen to the people of the archdiocese, to hear their fears and concerns as well as the priests’ and to be very present to the priests and the people…,” said Bishop Kicanas.

But Bishop Kicanas also said that unity needs to exist among Catholics in the Archdiocese of Milwaukee.
“It’s important that the Catholic community be united in its desire to restore trust and to address the harm that has been done, and to continue to pray for a fair and just resolution of the situation,” he said.

Deacon David Montgomery, communications director in the Diocese of Davenport, Iowa, said people experienced mixed reactions of disappointment and understanding when the diocese filed for Chapter 11 reorganization in October 2006.
“I think the greatest reaction that I recall was disappointment, but at the same time, the need to go through the process in order to make funds available for victims – that seemed to be the fairest way to get a monetary settlement for victims,” he said, “Otherwise, the first victims who would have come forward could have received all the money that the diocese had available, so that victims later on wouldn’t receive a similar amount, and through bankruptcy, they were able to go through a process that made the distribution equal or more equal depending on the case,” Deacon Montgomery said.

The Davenport Diocese concluded its filing of the Chapter 11 reorganization in December 2007 after an abuse settlement of $37 million, but not without challenge. Deacon Montgomery said the diocese had to comply with a number of non-monetary stipulations – such as Bishop Martin J. Amos visiting parishes where abuse occurred or where a priest who had abused was assigned. The diocese continues to comply with other stipulations as part of the agreed-to settlement.
“Some of them are ongoing such as regular posting of the availability of our victim assistance coordinator in the diocesan newspaper – that’s going to be an ongoing item that we need to complete,” he said.

While he admitted the process was difficult, Deacon Montgomery said that the diocese has benefited from it.
“I think in the end, it was the fairest way to address the issues and to make sure that the issues continue to be in front of us, and that it’s not something that goes away,” he said, noting that the VIRTUS Protecting God’s Children Program that was implemented in 2003 is a positive result of the tragedy of priest sexual abuse.
“The awareness has been raised to the point where people, when they’re in a situation with children, are always being concerned for their safety and providing a safe environment for them,” he said. “… I think other organizations have looked at not only us, but the Catholic Church as a whole and realized how they can make their environments for children safer.”
Deacon Montgomery offers Catholics of southeastern Wisconsin advice as they begin what the Davenport Diocese has overcome.
“I think people need to be prepared for a long process and be willing to compromise for the sake of all concerned – all the people concerned – because it affects more than just the diocese and the victims,” he said, “It affects all the people within the diocese and the people that diocese have come into contact with.”