Camden Diocese files for bankruptcy: Double hit by COVID-19, sex abuse payouts

The Diocese of Camden filed for bankruptcy on Thursday, blaming both the coronavirus pandemic for a reduction in revenue as well as the millions paid out this year to victims of clergy abuse.

Most religious institutions in New Jersey have had a tough year as attendance is down because of earlier "stay at home" orders issued by Gov. Phil Murphy. It also meant less donations at services. Traditional fundraisers were also canceled because of executive orders.

The Chapter 11 filing does not affect the diocese's 62 parishes, schools and other entities such as Catholic Charities. The Diocese serves nearly half a million Catholics in Atlantic, Camden, Cape May, Cumberland, Gloucester and Salem counties.

Earlier this year the diocese said it would close five schools. The diocese reversed course and decided to keep Wildwood Catholic open after it was heartened by "the support and immediacy with which the community responded to the needs of the high school, which indicates the value that they, too, have placed on maintaining Catholic secondary education in Cape May County."

In a letter to the faithful, Bishop Dennis Sullivan said the Diocese has paid out more than $8 million through the New Jersey Independent Victims Compensation Program, money that had to be borrowed.

"Additionally, the recent repeal of the statute of limitations has resulted in over fifty lawsuits being filed against the diocese involving long-ago claims of abuse. If it were just the pandemic, or just the costs of the Victims Compensation Program, we could likely weather the financial impact; however, the combination of these factors has made that impracticable," Sullivan wrote.

Sullivan said the bankruptcy filing is the best option for the Diocese "to provide those who have been abused an equitable share of the funds available, and also to ensure the future financial health of the diocese."

The Jeff Anderson & Associates law firm, which has filed many of the lawsuits against the church, called the filing “a disappointing, yet unsurprising, attempt to conceal the truth about predator priests in the Diocese at the expense of sexual abuse survivors” and accused the Diocese of “running from accountability.”

The firm said more than two dozen Catholic dioceses and archdioceses across the country have filed Chapter 11 bankruptcy but no others in New Jersey.

[gallery gallerytitle="What NJ trick or treating looks like in 2020"