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November 21, 2014

Abuse Suits Have Twin Cities Archdiocese Mulling Bankruptcy

Facing a budget hole and an expected wave of clergy-abuse lawsuits, the Archdiocese of St. Paul and Minneapolis said Thursday that it is considering filing for bankruptcy, the Star Tribune and the Associated Press report. The announcement came as the church released financial documents showing it ran a $9.1-million deficit in fiscal 2014 and has spent more than $4-million in the last year and a half to address allegations of sexual misconduct by clergy.

The archdiocese said abuse claims would likely outstrip the $5.3-million it has set aside to compensate victims. Eighteen cases are pending, and "we have no idea how many more legal claims may be made against us," Archbishop John Nienstedt wrote in the diocese newspaper.

The archdiocese announced plans last week to cut its operating budget by 20 percent and lay off 11 employees. Declaring bankruptcy, as nearly a dozen U.S. dioceses have done, would give a federal judge control over church finances and could affect payouts to abuse victims.