US diocese files for bankruptcy

The Catholic Archdiocese of Portland in the west coast state of Oregon, has become the first in the USA to file for bankruptcy. The move comes in the wake of scores of clergy sex abuse charges over several decades, and delays the start of the trial of two lawsuits seeking a total of $155 million. Archbishop John Vlazny told reporters yesterday that bankruptcy would allow the church to pay all claims without selling off parish assets. "It will allow us to continue our good works without fear of an impending large verdict. The operation of our parishes and schools will continue as usual," the archbishop said. Portland, which serves about 350,000 parishioners in Oregon, has paid $21 million from its own funds to settle claims in the last four years and $53 million over the last five decades, Archbishop John said, but insurance companies have refused to cover some 60 current claims. "The pot of gold is pretty much empty right now," he said. "Major insurance companies are not paying what they should on the claims." Several other US diocese have so far avoided bankruptcy by selling real estate and other holdings. Last April Boston agreed to sell land and buildings valued at more than $100 million to fund legal settlements to hundreds of abuse victims.