BISHOP INSTITUTES

                                                BUDGET CUTBACKS

Foreseeing a possible $7 million budget deficit in the next fiscal year in the Diocese of Brooklyn, Bishop Thomas V. Daily has instituted measures that will bear on the activities of some 60 programs and services supported by diocesan central funds.

            The bishop said that three years of weak returns on the endowed assets of the Diocese had reduced the income available to fund services that rely on diocesan central funds.

            “We cannot spend what we do not have,” Bishop Daily said in announcing a ten percent across-the-board reduction in agency budgets, effective Sept. 1, the beginning of the diocesan fiscal year.

            “All our efforts (must) be cost-effective so that any deficits projected may be eliminated as far as possible,” said the bishop. He informed agency heads of his decision at a meeting April 30 in the Immaculate Conception Center, Douglaston.

            Bishop Daily said he was not considering cutting back on the number of current employees, except for those who retire or resign. “All have been loyal, and many certainly have served this Diocese for many years,” he said.

            The major elements of the cost-reduction plan call for:

            ---A hiring freeze beginning May 1.

            ---Suspension of annual salary increases and Christmas bonuses for 2003/2004.

            ---A 2.5 percent budget reduction for agencies for the four months preceding the start of the new fiscal year. This is intended to cut into a projected budget deficit of nearly $3 million in the current fiscal year.

            “Realism dictates the decision I have reached,” Bishop Daily said.

“Everything seemed to be moving along in the right direction until about three years ago when danger signs became apparent in the economy,” he said. “In the recent 1990s, we enjoyed a certain sense of security.”

Fluctuations in the capital markets have made income derived from them unpredictable, he said. “It provides great income in good economic times but causes real consternation in difficult times.”

The chief sources of income needed to fund diocesan programs and services include assessments from parishes, the Annual Stewardship Appeal and income generated by the diocesan endowment. Among contingency items are bequests, contributions and the sale of property.

This is the first time Bishop Daily has been compelled to reduce budgets on this scale since he became the diocesan bishop in l990. A seven-member committee of priests and laity reviews agency budgets annually, usually in the Spring.

In a letter to agency directors last week reiterating the elements of the decision he announced at his April meeting with them, Bishop Daily added that the measures he was introducing were not caused by the clergy sexual abuse scandal. “You have my word that this unequivocally is not the case.”

Agencies affected by the bishop’s decision include Catholic Charities, the Office of Catholic Education, the Tribunal, the Catholic Migration Office, the Finance Office and many smaller programs.

The ten percent budget cutback also reduces the funds available for parishes and schools that receive diocesan assistance.

            Bishop Daily said he viewed the new budget plan as a means of “maintaining our diocesan solvency, enabling us to continue essential services and, indeed, the apostolic mission of the Church in the Diocese of Brooklyn.”