Catholic Archdiocese Raising $300 Million to Pay for Clergy Abuse

The Roman Catholic Archdiocese of New York said it establishing a $300-million fund to pay for survivors of sexual abuse at the hands of priests and lay personnel going back decades. The fund is expected to cover about 1,300 pending cases against the archdiocese from claimants who said they were abused as minors. The archdiocese also disclosed that it had agreed to engage a mediator to oversee the settlement process.

“As we have repeatedly acknowledged, the sexual abuse of minors long ago has brought shame upon our Church,” said Cardinal Timothy Dolan, in a statement released on the feast of the Immaculate Conception on Dec. 8. “I once again ask forgiveness for the failing of those who betrayed the trust placed in them by failing to provide for the safety of our young people.”

“Our goal has always been, and continues to be, to resolve expeditiously all meritorious claims, provide the maximum amount of compensation to the greatest number of victim-survivors and help them heal and move forward, a process that began in 2016 with the Independent Reconciliation and Compensation Program,” Cardinal Dolan said.

One source of the funds came from the $103-million sale of the archdiocese’s 20-story headquarters at 1011 First Ave. to developer Vanbarton Group, which plans to add six more stories to the building and convert it into residential rental units with a portion designated for affordable housing.

But Dolan said the archdiocese is also looking to finalize the sale of other “significant real estate assets.” That has worried people in Manhattan where a number of significant churches have been taken out of service.

On the Upper East Side, demolition work has been begun on the St. Elizabeth of Hungary Church in Yorkville, at 213 E. 83rd St., between Second and Third avenues. In its storied past, it was a haven for the deaf community, with a weekly mass conducted in American Sign Language and its own deaf choir. Dolan decommissioned the church back in 2014 and assigned it to the Church of St. Monica on East 79th Street. But it was not until earlier this year that the St. Elizabeth Church building, which has sat unused since 2014, was sold to real estate developer Avenu for $11.8 million. The building is now encased in scaffolding.

Down in the East Village, the Most Holy Redeemer Church on East 3rd Street, once know as the German Cathedral of the Lower East Side, shut down and stopped holding regular weekly masses over the Labor Day weekend. Preservationists are lobbying to have the church, erected in 1844, declared a landmark in order to prevent the archdiocese from selling to a real estate developer.

The archdiocese also said it was cutting its operating budget by 10 percent and laid off members of the HQ staff as a new HQ was established in rental space on Madison Avenue near St. Patrick’s Cathedral.

As part of the program to pay claimants of sex abuse, Cardinal Dolan said the archdiocese huddled last month with an ad hoc group of lawyers representing past victims. The two sides agreed to appoint retired California Judge Daniel J. Buckley–who had overseen a settlement between victim-survivors and the Los Angeles archdiocese–as a neutral mediator.

“As we undertook this work, we heard from victim-survivors looking to discuss resolving the remaining cases through a global settlement,” Dolan wrote. “A global settlement is one negotiated with the assistance of a third-party mediator who can help resolve cases more quickly and without the financial and emotional stresses of lengthy court proceedings.”

In the settlement overseen by Judge Buckley in Los Angeles, the LA archdiocese in October 2024, agreed to pay $880 million to settle claims from 1,353 survivors who said they were abused by some 300 priests or lay people stretching back decades. That settlement was on top of an earlier settlement of $740 million, bringing the total settlement to $1.5 billion. It was the largest settlement amount of any archdiocese stemming from the sex-abuse scandal, which has rocked the Catholic Church worldwide.

Dolan said the Archdiocese of New York is still involved in a protracted legal battle with its insurer, Chubb, which maintains it should not have to pay off sexual-abuse claims.

In December 2023, NYS Supreme Court Judge Suzanne J. Adams dismissed Chubb’s requests for declaratory judgments.

“The plain language of the insurance policies at issue covers bodily injury and negligence as alleged in the underlying [Child Victims Act] actions,” Adams wrote. She said that the Chubb insurers set forth no facts, policy language, or specifics of cases that would support declaratory judgments.

Chubb maintained that the archdiocese “knew about the sexual abuse of minors, failed to stop it, covered it up, and then lied about it,” the Insurance Journal reported.

But the archdiocese suffered a setback in April 2024, when an appelate court ruling said that Chubb could move forward with its lawsuit challenging whether its policies covered claims for systemic child sexual abuse that may have been enabled and covered up by church leaders for decades.

The archdiocese said Chubb should pay for the claims filed against the organization. “Despite accepting millions in premiums from the archdiocese, Chubb has steadfastly refused to honor the policies it issued,” Dolan said.

He also disclosed that Immaculate Heart of Mary parish in Scarsdale, which was facing dozens of lawsuits tied to the sex-abuse scandal, declared Chapter 11 bankruptcy on Dec. 8.

The pastor, Father Stephen Ries, said in a letter to parishioners that it “took this unfortunate but necessary step given the large number of cases arising from the Child Victims Act that allege sexual abuse by a now-deceased former lay employee at our parish.” He said the parish services and school would continue to operate.

Dolan said bankruptcy was “the only financial option available to them due to the prospect of imminent court proceedings.”

The New York Archdiocese, which is the second-biggest diocese in the country, serves about 2.5 million Catholics in Manhattan, the Bronx, and Staten Island, and the counties of Westchester, Orange, Putnam, Dutchess, Rockland, Sullivan, and Ulster. Brooklyn and Queens fall under the Diocese of Brooklyn.