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Catholic organizations in York County benefited from PPP

Logan Hullinger
York Dispatch
FILE - In this Sept. 27, 2015 file photo, clouds are lit by the rising sun over St. Augustine Roman Catholic Church in Philadelphia. Pennsylvania’s Roman Catholic dioceses have paid nearly $84 million to 564 victims of sexual abuse, a tally that’s sure to grow substantially in 2020 as compensation fund administrators work through a backlog of claims, according to an Associated Press review. (AP Photo/Julio Cortez)

Local Catholic organizations acquired at least $1 million in loans through a federal program meant to bolster small businesses amid the COVID-19 pandemic, an analysis by The York Dispatch found.

Yet the Roman Catholic Diocese of Harrisburg itself, unlike others throughout the state, was unable to acquire any funds through the Paycheck Protection Program because of a bankruptcy filing earlier this year.

"Because of the PPP monies, the parishes and schools in the Diocese were able to keep employees working, allowing them to maintain their households and provide for their families during these challenging and difficult times," diocese spokesperson Rachel Bryson said.

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York Catholic High School in York City, Tuesday, Oct. 16, 2018. Dawn J. Sagert photo

Individual Catholic parishes, charitable trusts and parochial schools in York County received cash through the federal forgivable loan program provided by the U.S. Small Business Administration.

York Catholic received between $350,000 and $1 million in PPP loans. Saint Joseph parish also received between $350,000 and $1 million in PPP loans. Saint Rose of Lima parish received a loan ranging from $150,000 to $350,000. 

The Roman Catholic Diocese of Harrisburg, as well as individuals working at the schools and churches, confirmed all of those funds went to paying employees.

"This is important to note, as it might clarify spurious questions on the minds of some that these monies could be redirected towards paying compensation for clergy abuse victims," said the Rev. Steve Fernandes, a pastor at Saint Joseph.

The Harrisburg Diocese, though, was unable to apply for PPP funds because it in February filed for bankruptcy. The filing came after a 2018 grand jury report revealed decades of sexual abuse and cover-up schemes.

However, all of the local schools and organizations were still able to apply because they are considered separate legal entities, Bryson said.

For example, the Catholic Charities of the Diocese of Harrisburg was able to obtain between $350,000 and $1 million, according to data from the Small Business Administration.

Those organizations related to the church accounted for just a sliver of the $232 million in loans given out under the federal program.

The Associated Press has estimated the government doled out at least $1.4 billion to religious organizations nationwide. That included Catholic dioceses in Erie, Philadelphia, Pittsburgh and Scranton.

The loans, meant to buoy small businesses throttled by the COVID-19 pandemic, have raised concerns among advocates for the separation of church and state and those who are weary based on the church's history of sex abuse.

Maggie Garrett, vice president for public policy at Americans United for Separation of Church and State, said that although everyone is struggling during the pandemic, taxpayer funding for religious organizations is at odds with a barrier between church and state.

“Our concern about this program is that the loans are forgiven by the government,” Garrett said. “So that transforms the loan into a taxpayer-funded grant. What the grants are paying for are clergy salary and religious activities. And that violates core principles of religious freedom.”

It is typically forbidden for faith-based organizations to be able to lobby to receive funds handled by the Small Business Administration.

But in the throes of the COVID-19 pandemic, which spurred two rounds of available PPP loans totaling $659 million, Congress permitted churches and related organizations to lobby for funds.

Any faith-based organizations that received funds, though, was required to abide by the program's language that states entities must employ fewer than 500 individuals.

That was until the Catholic Church successfully lobbied for President Donald Trump's administration to exempt religious groups from that criteria, The Associated Press reported.

For example, SpiriTrust Lutheran, a not-for-profit, faith-based organization that provides services ranging from assisted living to rehabilitation and counseling, received $6.75 million — allowing the company to retain its 900 employees.

Since the program began in March, parishes and schools have been approved for at least 3,500 forgivable loans, The Associated Press reported.

That includes about 40 dioceses that have spent millions settling sex-abuse claims.

— Logan Hullinger can be reached at lhullinger@yorkdispatch.com or via Twitter at @LoganHullYD.