We return to local Boston Archdiocese matters to let you know the archdiocese refuses to respond to inquiries about how they claimed to have a “balanced budget” in the 2011 fiscal year when their own financial reports show they did not. With the outgoing chancellor, Jim McDonough, still there for a few days, we hope the Vicar General can get answers from him before he departs, for the benefit of the future of the archdiocese.
The subject of this post is the key point to take away.

The archdiocese set out with a plan and goal to run a balanced budget for the 2011 fiscal year, but they spent more than expected and the published financials show they ran an operating loss of $4.2M–yet still announced to 1.8M Catholics and the media that they achieved the goal of a “balanced budget.” Plain and simple–unless there is some other data not published, what they announced appears to be untrue, and it is unhealthy for institutions that should be respected and trusted to violate that trust by saying things that are objectively not true.
Below are two emails we sent to the vice-chair of the Finance Council, Jack McCarthy, outgoing Chancellor Jim McDonough, Vicar General Msgr. Deeley, and John Straub, interim chancellor, and a short response from Communications Secretary, Terry Donilon.
———- Forwarded message ———-
From: Jim Franklin <bostoncatholicinsider@gmail.com>
Date: Mon, Feb 13, 2012 at 8:31 PM
Subject: Budget questions
To: jack.mccarthy@neu.edu, jpm@rcab.org, John_Straub@rcab.org
Cc: vicar_general@rcab.org
Mr. McCarthy, Mr. McDonough, and Mr. Straub,
As followup to the publication of the 2011 Annual Report, could you help explain how the Boston Archdiocese justifies publicly claiming the 2011 budget was “balanced” when on an operational basis, it was not actually balanced. I would also like to ask if you can let Boston Catholic Insider know if the attached comparison of budgeted expenses to actual expenses is accurate.
The Annual Report shows Operating Expense exceeded Operating Revenue by $4.2M. That means Central Operations ran at an operating loss. See below (our blog post, ““Balanced Budget” or Unbalanced Budget?) for the explanation we posted last week at Boston Catholic Insider. Is there some explanation available for why the archdiocese considers this budget to be “balanced” when the financial statements show a loss?
In the absence of any explanation for this discrepancy, we would be hard pressed to not say that the archdiocese is deceiving the Catholic faithful by saying the budget was balanced when in reality it was not.
Also, attached is a comparison of budgeted expenses from the 2011 budget plan vs the actual expenses in the 2011 Annual Report. It shows expenses up considerably over the original plan, and service fees up as well. When the budgeted spend is compared vs the higher than budgeted operating expenses, that explains the operating loss.
Boston Catholic Insider plans to publish this later in the week on Thursday and welcomes your feedback on what we are missing in our analysis or what errors we might have made. If you do not wish to interface directly with BCI, perhaps you might find some intermediary who would be willing to share your feedback on the below and the attached via email by end of day on Wednesday.
Thank you very much.
–Jim, for Boston Catholic Insider
———- Forwarded message ———-
From: Jim Franklin <bostoncatholicinsider@gmail.com>
Date: Thu, Feb 16, 2012 at 4:53 PM
Subject: Re: Budget questions
To: jack.mccarthy@neu.edu, jpm@rcab.org, John_Straub@rcab.org
Cc: vicar_general@rcab.org
Gentlemen,
in follow-up of my email of earlier in the week, would you like some additional time in which to respond–perhaps until end of day on Friday, or Monday? BCI is merely asking for clarification on why the financial statements show the budget is not balanced yet the verbiage accompanying the annual report says the budget is balanced. We are also wondering whether our analysis of budget vs actual spend is accurate for 2011? Is the analysis, and are the conclusions correct?
The archdiocese says you are delivering financial transparency. We are trying to help you with that! If the archdiocese operated at a loss, why not disclose that so that the best minds available could help to solve that problem? Jack McCarthy did a lot of work on financial transparency several years ago with the goal of restoring trust. In the absence of any response from the archdiocese and in the presence of the data reported and our analysis (which anyone can easily do), BCI will find it difficult to not tell our readers that essentially the Boston Archdiocese has lied to the public in the financial report.
In our post, we will communicate that the audited financial results and annual report show Central Ministries operated at a loss of $4.2M, the letter accompanying the report erroneously stated that the budget was balanced when that was known to be untrue, and the actual Central Ministries expenses were higher than the budget plan by about $4.1M. We will let our readers know that we approached you via email twice and asked for clarification and an explanation, but we received no response. We will also let readers and the press know we notified you in advance we were going to report that the archdiocese deceived the public in the annual report and received no rebuttal or correction from you.
In the absence of any rebuttal or correction by end of day on Friday, BCI assumes that you agree with our assessment of the financial condition of the diocese and the deceptive claim that the budget was balanced–and you have no problem with our publishing this.
To conclude, BCI does not wish to be in a position where we are reporting that the Boston Archdiocese has apparently deceived the public with the annual report and accompanying statement, but the apparent deception begs an explanation and clarification in order to maintain the transparency and trust the diocese says you are seeking. We look forward to hearing from you.
————————————-
From: Donilon, Terrence <Terrence_Donilon@rcab.org>
Date: Fri, Feb 17, 2012 at 5:03 PM
Subject: FW: Budget questions
To: “bostoncatholicinsider@gmail.com” <bostoncatholicinsider@gmail.com>
“Jim” –
We have been down this road before.
We are more than happy to meet with you but only if you agree to come in and meet with us in person.
As you know we are not going to engage anonymous bloggers.
Thanks,
Terry
# # # #
So, there you have it. The archdiocese has decided that faithful Catholics do not deserve a truthful explanation for the financial status of the archdiocese or a response to questions about what they have reported.
In case anyone got lost by all the numbers, here is the summary:
If you look at page 74 in the pdf of the 2011 Annual Report, you will see the following for Central Operations Total Operating Revenue and Expense:
Yet, despite published operating results which rather clearly show a loss, the report says on p.7, “During fiscal 2011, the goal of a balanced operating budget was once again achieved. The budget was approved in June 2010 as balanced with gross operating revenue and expense of $33.9 million.”
Yes, the budget was “approved as balanced” in June 2010 at 33.9M, but the data in the report says the goal was not actually achieved. If there is other data that shows the budget was really “balanced,” it has not been published.
In response to the email from Terry Donilon, BCI blogs anonymously because the Boston Archdiocese has a well documented pattern of retaliation against those who criticize them. We know the archdiocese has consulted with lawyers and reached out to computer forensics experts to try and identify BCI and stop our efforts, so we are protecting our reputations and livelihoods by blogging under a pseudonym. We hope one day to stop blogging –when the archdiocese simply operates with transparency and integrity–however the archdiocese keeps giving us new material, such as this.
BCI does not see any point in a private meeting with the archdiocese. If they feel comfortable deceiving 1.8M Catholics in the annual report and the secular media (e.g. Boston Globe and Boston Herald) or withholding important information, why would they feel obliged to tell BCI something more in a private meeting?
Besides withholding contributions to the Catholic Appeal, several readers have suggested we launch a campaign asking people to write and call the U.S. Apostolic Nuncio, who has a reputation for cleaning up fiscal corruption in the Vatican. We are prayerfully considering that option.
In the meantime, for today, you might try calling the office of the Vicar General, Msgr. Deeley at 617-746-5619 or sending him an email at Vicar_General@rcab.org to ask for an explanation. Let us know if you get a response.
Are faithful Catholics, and is BCI, out of line for asking that the Boston Archdiocese simply be honest and transparent in communicating the fiscal condition of the diocese? What do you think?



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