August 20, 2013
NURSING HOMES FOR POTENTIAL SALE AND SEEK OUTSOURCED MANAGEMENT AGREEMENT FOR
These potential actions follow the recent release of the Archdiocesan financial report and seek to rebuild a solid financial foundation for the Church of Philadelphia
This July, the Archdiocese of Philadelphia published audited financial statements for the fiscal year ended June 30, 2012. The financial statements disclosed a $39.2 million operating deficit for that period as well as several very significant and ongoing balance sheet issues that measure in the hundreds of millions of dollars.
Since his arrival in Philadelphia nearly two years ago, Archbishop Chaput has repeatedly expressed his commitment to financial transparency and prudent stewardship of the resources of the Archdiocese. Beginning last summer, a series of steps were taken to begin to remedy Archdiocesan fiscal challenges. The Archbishop's residence along with a property in Ventnor, New Jersey, were both sold to provide necessary immediate cash flow. Many other actions followed including a reduction of 25% of the workforce at the Archdiocesan Pastoral Center in order to stem the operating deficit. Additionally, an evaluation of various Archdiocesan real estate assets and operating entities was undertaken. This evaluation focused on assets that could potentially be used to remedy the balance sheet issues. None of those measures were taken lightly, but all were essential to maintaining the presence of the Catholic Church in the Philadelphia region and the good works accomplished through its various ministries.
Background Regarding Today's Announcement
Among the operating entities evaluated were Catholic Health Care Services and the Office of Catholic Cemeteries, which have both been well managed for many years. As a result, Archbishop Chaput has decided to market the six nursing homes and one assisted living facility operated by Catholic Health Care Services for potential sale. He has also decided to pursue a possible outsourced management and leasing agreement for the 11 active Archdiocesan cemeteries and two sites designated for future cemetery development.
In making this announcement, Archbishop Chaput said, "Our difficult financial situation must be addressed and the actions that we need to take may be painful ones. I understand this fact fully, but it is of critical importance that we rebuild our financial foundation so that we can continue our collective good works.
None of the decisions I have made about our finances thus far were made lightly. They have all come after much careful discernment and prayer as well as significant discussion and consultation. In the end, any final decisions about our nursing homes and cemeteries will be mine. They'll be made with full and due consideration to the mission of our local Church and all those who would be affected."
Background Regarding the Potential Sale of Catholic Health Care Services
Founded in 1913, Catholic Health Care Services of the Archdiocese of Philadelphia is the seventh largest faith-based provider of skilled nursing and assisted living care in the country with a total occupancy of just over 1,400 beds. In addition to the services noted above, it also provides adult day care, rehabilitation therapy, memory support, affordable housing, community support outreach and end-of-life care programs. The system currently has approximately 1,100 full-time and 950 part-time employees.
A condition to any possible sale would be the retention of all current nursing home residents regardless of their payor status. Every effort will be made to ensure continued employment for all those currently working within the system. Employees were provided with information regarding the marketing of Catholic Health Care Services at meetings today. Written follow up communication will also be sent to them. A letter has also been sent to the families of all of our current residents.
The following is a list of the facilities being marketed for potential sale: Immaculate Mary Home, Philadelphia; Villa Saint Martha, Downingtown (Chester County); Saint Francis Country House, Darby (Delaware County); Saint John Neumann Home, Philadelphia; Saint Martha Manor, Downingtown (Chester County); Saint Mary Manor, Lansdale (Montgomery County); and Saint Monica Manor, Philadelphia.
Background Regarding the Pursuit of an Outsourced Management Agreement for Catholic Cemeteries
Founded in 1849, the Catholic Cemeteries Office of the Archdiocese of Philadelphia operates 11 cemeteries located in Chester, Delaware, Bucks, Montgomery and Philadelphia counties. It also owns two land parcels that have been designated for future use. One is in Bucks County. The other is in Chester County. Last year, it conducted nearly 6,900 committals. It is staffed by approximately 160 full-time and approximately 30 seasonal employees in its central office at the Archdiocesan Pastoral Center and at individual cemeteries.
It is important to note that the cemeteries will not be sold. Any potential arrangement would result in the Archdiocese retaining ownership while outsourcing management and operations, which would still be conducted in a manner consistent with Catholic values and the core mission of the cemeteries. Parish cemeteries would not be affected as they are operated at the local level. Every effort will also be made to ensure continued employment for those currently working within the system. Employees were provided with information regarding the pursuit of a possible outsourced management agreement at meetings today. Written follow up communication will also be distributed to them. All priests of the Archdiocese as well as funeral directors with whom the Catholic cemeteries work are also being informed.
The following is a list of cemeteries that would be affected by a potential outsourced management agreement: All Souls Cemetery, Coatesville (Chester County); Calvary Cemetery, West Conshohocken (Montgomery County); Cathedral Cemetery, Philadelphia; New Cathedral Cemetery, Philadelphia; Holy Cross Cemetery, Yeadon (Delaware County); Holy Sepulchre Cemetery, Philadelphia; Immaculate Heart of Mary Cemetery, Linwood (Delaware County); Resurrection Cemetery, Bensalem (Bucks County); Saint John Neumann Cemetery, Chalfont (Bucks County); Saint Michael Cemetery, Chester (Delaware County); and Saints Peter and Paul Cemetery, Springfield (Delaware County). Additionally, All Saints Cemetery, Newtown (Bucks County) and Holy Savior Cemetery, Penn Township (Bucks County) are not currently active cemeteries, but sites designated for future use. They would also be affected.
When final decisions are made regarding both Catholic Health Care Services and the Catholic Cemeteries Office, appropriate announcements will be made to employees, other stakeholders and the general public.
Editor's Note: To view the financial reports released by the Archdiocese of Philadelphia in July, please visit www.CatholicPhilly.com.
Kenneth A. Gavin
Director of Communications