PROVIDENCE — A recently released annual audit of its finances shows that the Diocese of Providence ended fiscal year 2022 on solid financial footing.
While diocesan investments benefitted from a rise in activity and optimism in consumer confidence for the first half of the 2021-2022 fiscal year, there was a significant softening of these gains in the second half, with the year ending in negative territory.
Despite the downturn in investments, which amounted to about $32 million at the close of the fiscal year, the Diocesan General Fund finished the year with a surplus of approximately $347,000. The forgiveness of $564,000 in loans the diocese received through the government’s Payroll Protection Program, instituted during the pandemic, made the surplus possible.
“That’s exceptional,” said Chief Financial Officer Michael F. Sabatino. “We absorbed a $320,000 realized loss on investments through the General Fund and still had an operational surplus.”
The Catholic Charity Fund, which made its goal of $6.8 million, ended the year with a $1.6 million surplus, of which $504,000 was the forgiveness of loans received through the Payroll Protection Program.
In addition to the $1,068,000 in loan forgiveness by the government for diocesan entities under the audit, finances were also aided by the General Fund only utilizing $150,000 of diocesan reserves for June 2022 in comparison to $300,000 in prior years. This decrease resulted in part from the generation of larger distributions from endowments enhanced by the addition of revenues received through the Grateful for God’s Providence capital campaign.
“Overall, we’re very satisfied with the results, even though the investment results were mixed,” Sabatino said.
“We understand that there’s going to be some ups and downs within the investment market. Some years we’re going to have exceptional years, while other years are going to be more difficult. Although the first six months of fiscal year 2022 look good, the second six months were difficult.”
The Grateful for God’s Providence campaign, which is now in its redemption phase, raised $54,696,877 million on its goal of $50 million. The total collected to date is $46,301,140, of which $15.2 million has been distributed to parishes.
“We’re really pleased with the results that we have before us,” Vicar of Finance Msgr. Raymond B. Bastia said. “The audit went very well. There are some encouraging trends that we see.”
Even factoring in an expected $4 million in pledge write-offs, Msgr. Bastia said that the capital campaign should still raise its $50 million goal upon its conclusion.
“There are no guarantees for the future, but at least at present we seem to be on a good, solid financial path,” he added, noting the success of the Catholic Charity Appeal, and the fact that parishes across the diocese are reporting that a steady income is being received from the faithful, as reflected in the parish assessments.
Sabatino noted that parish assessments were up more than $100,000 in fiscal year 2022.
“It’s a tribute to the good work our pastors are doing, especially coming out of COVID, and the support of the parishioners in responding,” he said.
The Catholic Foundation of RI, a separate corporation under the Diocese of Providence, recorded more than $127 million in assets, down from $140 million the previous year. It is still ranked as the 14th largest diocesan foundation in the nation.
According to the report, both the lay and clergy pension plans were 87% funded at the close of the fiscal year.
Also, the Interparish Loan Fund, whose assets are not diocesan funds, but rather are parish deposits managed by the diocese which help to sponsor building projects or needs within other parishes, ended the fiscal year at $62,414,129 in deposits, and $37,029,138 million in loans.
The Diocesan Cemeteries Perpetual Care Fund stood at more than $32 million, down from $35 million the previous year, due to negative investment returns, according to the report.
With the building of a new $12 million mausoleum at St. Ann’s Cemetery, total sales as of the end of the fiscal year were $6.2 million.
Also, in FY2022, major renovation work was completed on the Cathedral of SS. Peter and Paul roof and its two towers, at a total cost of $14 million. The roof, at a cost of $4.5 million, was paid from the capital campaign funds directed for that purpose, and the towers ($9.5 million), was paid from the sale of properties, diocesan reserves and a very generous contribution from a donor, according to the audit report.
In addition at the cathedral, a new marble cathedra was installed at a cost of $145,000.
“That was an independent fundraising activity,” Sabatino said. “Donations were solicited from vendors, and there was a gift from an estate that came in along with contributions from other anonymous donors.”
The diocese did not sell any non-ministerial properties during this time, but it managed to pay down $1 million of its line of credit in FY2022, leaving a balance of $2.5 million.
“As we move forward, Fiscal Year 2022/2023 holds much promise for the Diocese of Providence,” Bishop Thomas J. Tobin said in a letter accompanying the release this week of a User-Friendly Financial Report (a copy of which is included in this edition).
“We are blessed to welcome our new Coadjutor the Most Rev. Bishop Richard Henning. Our diocese will continue to do its best to be careful stewards of its resources by relying on the generous support provided by so many of the faithful who continue to give of their time, talent and treasure. Also, we continue to be blessed with the outstanding leadership of our Priests who minister selflessly to their parishes and work for the greater good of the Church.
The full audit report, produced by the firm Mayer, Hoffman, McCann, P.C., may be viewed on the diocesan website at dioceseofprovidence.org, while a “user-friendly” version is included in this edition. This report offers a summary of the full audited report and focuses on the ministerial activities supported by either the General Fund or the Catholic Charity Appeal.
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