NEW YORK – The U.S. Roman Catholic Church used a special and unprecedented exemption from federal rules to amass at least $1.4 billion in taxpayer-backed coronavirus aid, with many millions going to dioceses that have paid huge settlements or sought bankruptcy protection because of clergy sexual abuse cover-ups.
The church's haul may have reached — or even exceeded — $3.5 billion, making a global religious institution with more than a billion followers among the biggest winners in the U.S. government's pandemic relief efforts, an Associated Press analysis of federal data released this week found.
Houses of worship and faith-based organizations that promote religious beliefs aren't usually eligible for money from the U.S. Small Business Administration. But as the economy plummeted and jobless rates soared, Congress let faith groups and other nonprofits tap into the Paycheck Protection Program (PPP), a $659 billion fund created to keep Main Street open and Americans employed.
By aggressively promoting the payroll program and marshaling resources to help affiliates navigate its shifting rules, Catholic dioceses, parishes, schools and other ministries have so far received approval for at least 3,500 forgivable loans, AP found.
The Archdiocese of New York, for example, received 15 loans worth at least $28 million just for its top executive offices. Its iconic St. Patrick's Cathedral on Fifth Avenue was approved for at least $1 million.
In Orange County, Calif., where a sparkling glass cathedral estimated to cost over $70 million recently opened, diocesan officials working at the complex received four loans worth at least $3 million.
In Minnesota, four of the five Catholic districts that declared bankruptcy following abuse allegations received PPP funding, but not exactly a windfall. The Archdiocese of St. Paul and Minneapolis received between $1 million and $2 million, indicating 161 jobs would be retained. The Diocese of St. Cloud received from $350,000 to $1 million to retain 55 jobs. The dioceses of Duluth, New Ulm and Crookston — which did not declare bankruptcy — received $150,000 to $300,000 for job retention.
The Winona-Rochester Diocese, which declared bankruptcy in 2018, did not receive funding.
The three largest grants among Minnesota religious groups went to the Anoka-based megachurch Eaglebrook Church, the Evangelical Lutheran Church in America pension fund, and Episcopal Church Homes retirement communities. Each received between $2 million and $5 million.
Another 12 individual churches received $1 million to $2 million, including Wooddale Church in Eden Prairie, Hosanna Lutheran Church in Lakeville and Church of the Ascension in Minneapolis.
About 250 churches and faith-based groups received funding, with the majority receiving $150,000 to $350,000.
Simply being eligible for low-interest loans was a new opportunity. But the church couldn't have been approved for so many loans — which the government will forgive if they are used for wage, rent and utilities — without a second break.
Religious groups persuaded the Trump administration to free them from a rule that typically disqualifies an applicant with more than 500 workers. Without this preferential treatment, many Catholic dioceses would have been ineligible because — between their head offices, parishes and other affiliates — their employees exceed the 500-person cap.
"The government grants special dispensation, and that creates a kind of structural favoritism," said Micah Schwartzman, a University of Virginia law professor specializing in constitutional issues and religion who has studied the Paycheck Protection Program. "And that favoritism was worth billions of dollars."
The amount that the church collected, between $1.4 billion and $3.5 billion, is an undercount. The Diocesan Fiscal Management Conference, an organization of Catholic financial officers, surveyed members and reported that about 9,000 Catholic entities received loans. That is nearly three times the number of Catholic recipients AP could identify.
AP couldn't find more Catholic beneficiaries because the government's data, released after pressure from Congress and a lawsuit from news outlets including the AP, didn't name recipients of loans under $150,000 — a category in which many smaller churches would fall. And because the government released only ranges of loan amounts, it wasn't possible to be more precise.
Even without a full accounting, AP's analysis places the Catholic Church among the major beneficiaries in the program, which also has helped companies backed by celebrities, billionaires, state governors and members of Congress.
The program was open to all religious groups, and many took advantage. Evangelical advisers to President Donald Trump, including his White House spiritual czar, Paula White-Cain, also received loans.
There is no doubt that state shelter-in-place orders disrupted houses of worship and businesses alike. Masses were canceled, even during the Holy Week and Easter holidays, depriving parishes of expected revenue and contributing to layoffs in some dioceses. Some families of Catholic school students are struggling to make tuition payments. And the expense of disinfecting classrooms once classes resume will put additional pressure on budgets.
But other problems were self-inflicted. Long before the pandemic, scores of dioceses faced increasing financial pressure because of a dramatic rise in recent clergy sex-abuse claims.
Loan recipients included about 40 dioceses that have spent hundreds of millions of dollars in the past few years paying victims through compensation funds or bankruptcy proceedings. AP's review found that these dioceses were approved for about $200 million, though the value is likely much higher.
"These loans are an essential lifeline to help faith-based organizations to stay afloat and continue serving those in need during this crisis," Chieko Noguchi, a spokeswoman for the U.S. Conference of Catholic Bishops, said in a written statement. According to AP's data analysis, the church and all its organizations reported retaining at least 407,900 jobs with the money they were awarded.
Bishop Lawrence Persico of Erie, Penn., pushed back on the idea that dioceses should be excluded from the government's rescue package.
He pointed out that church entities help feed, clothe and shelter the poor — and in doing so keep people employed.
"I know some people may react with surprise that government funding helped support faith-based schools, parishes and dioceses," he said. "The separation of church and state does not mean that those motivated by their faith have no place in the public square."
Staff writer Jean Hopfensperger contributed to this report.