By now, you all know how the archdiocese has reneged on previous commitments to fund the lay pension plan, including $5 million owed by closed parishes to the plan (some of which was redirected to Jack Connors’ pet school project in Brockton instead of where it was promised to go).
But perhaps you did not know that as of January 1, 2011 the Archdiocese and Chancellor Jim McDonough are also technically in default on about $5 million owed to St. Johns Seminary as the first part of repaying about $40 million due for the 2007 sale of seminary property.
BCI first alerted readers to this $4.8M note due last October as part of our “Seminary Squeezola” series. Here is what we said then:
As most people know, back in 2007 the Archdiocese sold off the huge majority of the land and buildings owned by St. John Seminary to Boston College when the archdiocese needed to raise cash. We will go into the details of the transaction at another time. The archdiocese took the cash and according to St. John’s Annual report, the archdiocese owes St. Johns $4.8 million (plus interest) as of January 2011 from the 2004 sale of seminary land, and another $36 million in 2017.
How the cash-poor archdiocese will pay back those debts from the land they forced the seminary to sell is a story for another time. So is the question of why Chancellor Jim McDonough is on the board of the seminary, when his main business is consuming money for the archdiocese–which presents a humongous conflict of interest vs advancing the formation of seminarians.
Well, the time has arrived. Much to our surprise, it turns out that the cash-poor archdiocese did not have the cash to pay off the $5M due January 1. So, sources tell BCI the first thing Chancellor tried to do was just write-off the debt, kind of like he is doing with the pension fund. Apparently that did not work with the seminary, so now negotiations are underway for repayment of this first obligation to St. Johns Seminary by giving the seminary some other Brighton real estate instead.
Anyone see a pattern with the Chancellor and the current administrative leadership of the archdiocese? Make a promise–verbally or in writing–that people or organizations rely upon, then reneg and try to get off scott free. Here is the exact passage from the St. Johns Seminary annual report that details the financial obligation:
Besides defaulting on this payment, we still have the problem of the inherent conflict of interest of the Chancellor serving on the Board of St. Johns Seminary. We know we have BCI readers who are supportive of the seminary remaining in Brighton and some who are not so supportive of that, and opinions on that topic are not relevant for this discussion. As we wrote in St. Johns Seminary Squeezola: Chancellor Conflict of Interest and Money Grab, the conflicts of interest start at the top.
We give the Cardinal due respect and credit to serve as the chairman of the board of the diocesan seminary, but it should be noted that the seminary is not Corporation Sole. It predates Corp Sole by 15 years, and was chartered by an act of the Legislature, as was Corp Sole. They are distinct in every way (seminary is a university technically, Corp Sole is a religion) with the exception of interlocking boards with profound conflicts of interest. The Cardinal, McDonough and Fr. Erikson have voted according to documents online, in direct conflict with the best interest of the seminary, in order to benefit Corp Sole. By coincidence, archdiocesan Beirne Lovely attends some of the seminar board meetings, where he states that he is not the seminary’s lawyer. So one might ask, why is he even there?
Why are these conflicts of interest tolerated? How do we get these people with inherent conflicts of interest off the board of the seminary? Are any priests safe and secure enough in their role and relationship with the Cardinal that they are willing to stand up and tell the Cardinal he needs to start making some governance changes? Why do people–even those supportive of the seminary and posting to this blog supportive of the seminary–allow themselves to conclude that the final takeover of St. John’s Hall by BC is a foregone conclusion, when the seminary is prospering? Should not the first move be to remove people from the Board of Trustees who have clear conflicts of interest with agendas other than the prosperity of the seminary and the formation of priests for the future of the Catholic Church?
The Chancellor simply cannot uphold a fiduciary responsibility to the seminary to collect $40 million owed by the archdiocese at the same time he writes the checks for the archdiocese and has an interest in writing off the entire debt. Period.
In a week or two, the archdiocese will announce with great fanfare how they balanced the 2010 budget. Conveniently missing will be the mention of all of the debts the Chancellor defaulted on in order to create the illusion of a balanced budget. The defaulting on those debts affects low-paid former employees who relied on pensions for their retirement, seminarians, priests and religious who also need their retirement funds after a lifetime of service to God and the Church.
The Chancellor knows how to pay himself, a retired multi-millionaire banker, the general counsel (retired lawyer), and the superintendent of schools (a retired school administrator with a $75K+/year pension) more than $5 million over 5 years in salaries and benefits, he knows how to pay himself and his new #2 guy a total of $500+K/year in salary and benefits for a role usually filled by one person in other dioceses at half that cost or less, and he knows how to direct $2.5M to Archbishop Jack Connors’ pet schools project in Brockton, but he does not know how to fund pensions for former employees or pay off debts he himself committed to pay.
For the good of rebuilding trust in the archdiocese, if the Chancellor does not voluntarily resign soon, we urge all Catholics to request of their pastors that they ask the Cardinal to replace him.