Our Next Scandal

Paycheck Protection Program

About a year ago, we Americans began to realize that the coronavirus would change our lives. On March 27, 2020, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act, with bipartisan unanimity. The president promptly signed it.

The CARES Act provided for–among other things–the Paycheck Protection Program. The federal government funded the PPP in order to help small businesses that needed cash in order to survive. The idea: Let’s keep small-business employees working and paid, even if revenue plummets.

St Francis of Assisi Rocky Mount
St. Francis of Assisi, Rocky Mount, Virginia

The money would come in the form of a loan to cover two and one-half months of payroll. Uncle Sam would forgive the loan completely, if you used the money to pay employees, rent, utilities, or interest on a mortgage.

According to the Small Business Administration, tasked with administering the program, “small business” includes small non-profits.

Now, are Catholic parishes ‘small non-profits?’ According to one seminary professor of canon law, yes.

Nearly each of the nation’s 17,000 parishes operates as its own non-profit… Under canon law, the assets of the parish are managed by the pastor and are not owned by the bishop.

The federal government agreed.

The finance office of our diocese guided our two parishes here in southwest Virginny through the application process. In a matter of weeks, both parishes had received the government funds. A total, as best I can recall, of about $40,000. (I no longer have access to the figures.)

St. Joseph’s, Martinsville, Virginia

Meanwhile, another “small non-profit” did the same–the Catholic Diocese of Richmond, in the western part of that city, 165 miles away. That other small non-profit also received federal money to meet the payroll at the diocesan headquarters ($2 million).

Then, in a stunning turn of events, the CEO of that small non-profit 165 miles away unilaterally ordered the removal of the CEO of the two small non-profits in Rocky Mount and Martinsville. And the Richmond small non-profit CEO had all the locks re-keyed on the buildings owned by the small Rocky Mount and Martinsville non-profits.

A couple weeks ago, the Associated Press published the second of two comprehensive reports on Catholic use of PPP money. The Catholic Church in the United States holds at least $10 billion in cash or other immediately usable assets. Meanwhile, Catholic entities have received at least $3 billion of the federal aid money.


The report makes our Church look opportunistic and dishonest. (And that’s a nice way to put it.) So much so, in fact, that there likely will be a congressional investigation–and certainly should be, if there’s any justice for the American taxpayer.

Not that Catholic “small non-profit businesses” are the only institutions that seem to have abused the PPP. Far from it. But apparently we are the largest and most-egregious abuser of the program.

We have to ask, though: Do the Associated Press reports paint a fair picture? After all, we poor Catholics have suffered plenty of unfair press over the centuries here in the U.S. Non-Catholics tend to see our Church as some kind of monolith, while we on the inside know that it’s actually a large herd of cats.

To consider the fairness of the AP report, let’s break down the purpose of the PPP into it’s two parts. To fund the program, the federal government borrowed from our as-yet-unborn great-grandchildren in order to: save small businesses (1) from going under completely (2).

1. Is a Catholic parish a small non-profit?

As mentioned earlier, numerous Catholic writers have tried to explain away the Associated Press findings with this argument: It’s not one big company. The Catholic Church in the USA does not have one payroll. Even a diocese–its parishes, schools, hospitals, nursing homes, and charities: not one big company. They are each separate companies. Separate property, bank accounts, and employees to pay.

Problem is: That idea would come as a stunning surprise to the Catholic parishioners here in this little part of the world. They found themselves without a pastor, and locked out of their own buildings, all because of the unilateral decision of someone who–according to the “small non-profit” logic–has no direct connection with the two parishes. Only a relationship of “theological communion.” Somehow that “communion” managed to change the locks.

But that’s not the only example that gives the lie to the “small non-profit” logic. The bishop has unilateral hiring and firing authority over the vast majority of the CEOs of all the “small non-profits” in the diocese. He regularly compels the small non-profits to raise money and send it to him. The nursing homes of the diocese operate with a surplus of cash, and they provide a significant portion of the income necessary to run the operations at diocesan hq. In the middle of the last decade, the bishop compelled us priests and Catholic people to raise $100 million, a big portion of which has funded large diocesan endowments.

2. Did we need the federal aid money?

Last spring everyone trembled. In our parishes, we feared not being able to make payroll. At St. Joseph’s, that prospect became an imminent possibility. At St. Francis, the money we had in the bank could have held us for a year or two, before we totally ran out of money.

ten-thousand-dollar-bill-salmon-p-chaseUnder “normal” circumstances, that money in the bank at St. Francis should get used only for the specific purpose for which it was raised, just like the $140 million+ that the diocese and its associated foundation has.

The money in the bank at St. Francis should go to a building project. We had one planned and ready to move forward when the virus hit, as some of you dear readers remember. And the endowments the diocese has should be used for the specific purposes for which they were set up in the first place.

Should, that is, unless a catastrophic emergency occurs.

Our national treasury was already way empty. The USA already owed more money than any of us can really imagine in our little brains. But we faced a catastrophic emergency as a nation. Potential economic collapse threatened the survival of American small businesses. The US government took out another huge loan, with both political parties endorsing the move.

We Catholic “small non-profits” took $3 billion that small businesses in genuine danger could have had. We were never in real danger of going under. The Catholic Church in America has more than enough ready capital within its own institutions to support the parts of the Church that need it.

Our bishops have yet again brought us to the precipice of a crushing scandal. This time, though, it’s not too late to avoid the debilitating hit to the reputation of our Church.

Everyone panicked last spring. No one knew what the future would hold. It’s only with hindsight that we can see clearly: we wrongly padded our already-big Catholic bank accounts with money that should have gone elsewhere.

We can still give the money back. It’s not too late to do that.

Please, Excellencies. For once, let’s do what the average American will see as the right thing. Protect us rank-and-file Catholics from yet another faith-challenging embarrassment. Let’s give the $3 billion back to Uncle Sam.

6 thoughts on “Our Next Scandal

  1. It’s an interesting issue. Perhaps the definition of “small” should have been redefined for the purposes of this federal “gift.” Such an approach could have gone a long way toward avoiding a bad taste. After all a mortgage company painstakingly evaluates the credibility and solvency of a loan applicant, not wishing their loan to be at risk (unless congress tells them to be liberal with loan offers, which they have done on several occasions).

    Uncle Sam even sent little ol’ me a check. I didn’t ask for it, and I am not excited to find out when tax time hits whether I will have to “pay” for that “gift.” (I’m sure I could look it up and find out, but that’s not high on my priority list right now.) That said, I could have destroyed the check, but like every other dutiful American, I deposited it and said thank you. Of course that’s different from having to fill out an application for federal aid.

    I own a little business and the thought crossed my mind whether I should take the opportunity for Uncle Sam to pay my living wage. I decided against it. I am sure many other very small businesses also declined and just rolled with the lumps. I pray that 2022 sees better days, not looking good for 2021.

  2. Couldn’t agree more with the concept of returning the ill-gotten proceeds. Kind of like going to confession, and being told that as a condition of absolution, you must make restitution. The funds are available to do the right thing. Don’t hold your breath. Actually, the hierarchy has become adept at doing exactly the wrong thing when given the opportunity.

  3. Bernadette, according to a paper I received from the Federal government, we do not have to pay taxes on the “Covid” money. For some folks I know who felt they truly didn’t need the money, they have used it to help others who were really in dire need.

    On the subject of the money the church received, maybe they want to use it to help themselves out of the financial problems they’ve encountered due to the sexual abuse situation. Or maybe they just want to tuck it away out of sight. Not saying I approve of either option….

    In my opinion, the only thing the hierarchy loves more than itself and power is money. Very sad actually.


  4. This is a second reply: the subject of this money reminded me of a situation with the late Cardinal Spellman and the late Bishop Fulton Sheen. [Source: Wikipedia/Raymond Arroyo’s foreword to Sheen’s autobiography..
    https://en.wilipedia.org/wiki/Fulton_J._Sheen%5D%5D “In the late 1950’s, the government donated millions of dollars’ worth of powdered milk to the New York Archdiocese. In turn, Cardinal Spellman handed that milk over to the Society for the Propagation of the Faith to distribute to the poor of the world. On at least one occasion, he demanded that the director of the Society, Bishop Sheen, pay the Archdiocese for the donated milk. He wanted millions of dollars. Despite Cardinal Spellman’s considerable powers of persuasion and influence in Rome, Sheen refused. These were funds donated by the public to the missions, funds Sheen himself had personally contributed to and raised over the airwaves. He felt an obligation to protect them, even from the itchy fingers of his own Cardinal.”
    Spellman later took the issue directly to Pope Pius XII, pleading his case with Sheen present. The Pope sided with Sheen. Spellman later confronted Sheen, stating, “I will get even with you. It may take six months, or ten years, but everyone will know what you are like.” Besides being pressured to leave television, Sheen also “found himself unwelcome in the churches of New York City. Spellman canceled Sheen’s annual Good Friday sermons at St. Patrick’s Cathedral and discouraged clergy from befriending the Bishop.” In 1966, Spellman had Sheen reassigned to Rochester, New York, and caused his leadership at the Society for the Propagation of the Faith to be terminated (a position he had held for 16 years and raised hundreds of millions of dollars for, to which he had personally donated US$10 million of his earnings). On December 2, 1967, Spellman died in New York City.
    Sheen never talked about the situation, only making vague references to his “trials both inside and outside the Church.” He even went so far as to praise Spellman in his autobiography. (end of source quote)
    I share this lengthy “reply” because, in my personal opinion, it seems things haven’t changed very much over the years. Money is still the ruler, the hierarchy doesn’t hesitate to wield its power, and good men [priests] still pay the price when they determine to stand for what is right.

  5. Thanks for the confirmation, Judy, but as I told my OB/GYN 23 years ago when he announced that I was having a girl baby, I’ll believe it when I see it.

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