Saturday, June 25, 2011

Reflections on a diocesan budget

Cathedraticum, a Latin word, is the name for the tax each Catholic parish must pay its bishop.  This diocesan assessment fee equates to a percentage of the weekly parish collection plate.  Canon law says the assessment rate should be determined by local custom or provincial council.  In U.S. dioceses, the assessment tax rate is anywhere from 5% - 15% typically.    

The bishop also conducts a diocesan services appeal (DSA) every year.  These donations, combined with the revenues from assessment taxes, fund most of the diocese’s annual operating budget.

Church officials universally seem to complain that parish donations are down significantly.  Based upon weekly reports in the local church bulletins, I do see a marked reduction in weekly parish donations.  The rationale suggested has been declines in both the economy and Mass attendance.

I track the financial statements of my diocese since they are posted on the diocesan website.  The following graph tracks revenues from my diocese’s assessments (taxation upon parishes), DSA, and the combined total, for the past 6 years.    


Since parish contributions are down significantly, if the diocesan tax rate remained steady, the line for diocesan assessment revenues should also decline.  As you can see, in my diocese, diocesan assessment revenues actually have remained quite steady with an overall slight trending increase over the last 6 years.  This is inconsistent with parish collection trends.  For the assessment to remain at constant levels when parish collections are lower, the diocese has to increase the tax rate, taking a larger portion of parishes’ weekly collections.  At a time when parishes are already suffering from low collections, why would the diocese increase its tax upon parishes? 

My diocese is located in one of the most economically depressed parts of the U.S.  Yet, it appears DSA and assessment contributions are pretty stable.  I assumed that fairly stable diocesan contribution levels would mean the diocese’s support of Catholic Charities also would be stable or possibly even increase due to the area’s increased need.  Imagine my surprise to see the diocese decreasing the percentage of its budget going to Catholic Charities. 

The graph below shows that the diocese also invests a shrinking percentage of its budget on things like Catholic education and catechesis (children and religious education) while increasing the percentage of the budget going to formation and the chancery (the clergy and bishop).  The percentage of budget going towards formation now surpasses the percentage supporting Catholic Charities, and the percentage allocated for the bishop’s office (chancery) is nearing the funding level for Catholic Charities also.  Why?

Finally, why is the largest part of the diocesan budget administrative costs, at over 28%?  Since the chancery office is the bishop’s office, it is also a form of administrative overhead and could be added to the amounts spent on administration, adding almost another 18%. Those two areas account for almost 50% of the central services budget.

When choosing where to donate my money, I look for charities with low administrative costs, in the 15% range.  Why do administrative costs consume such a large portion of the church’s budget?   Do these investment priorities reflect the gospel?  Might a larger investment in quality pastoral planning help reduce administrative costs and increase the ability to support Catholic Charities?