Bishop Thomas' comments on the Diocese of Helena financial report

I am pleased to present the financial report for the Diocese of Helena for the years ended June 30, 2002, through June 30, 2005. Since my installation as the Bishop of Helena, I have supported the ongoing efforts to improve our use of the computer software to provide timely, clear, and transparent financial reporting. This report brings us up to date in such reporting and covers the fiscal years since the last financial report in the July 18, 2003, issue of the Montana Catholic. In prior issues of the Montana Catholic and in various gatherings of the people of our diocese, I have discussed the financial history and the hopes for the future financial stability of our diocese. I appreciate your continued interest and candid feedback.

A portion of the bishop’s pastoral ministry involves the care and oversight of the Church’s temporal goods and resources. I asked various volunteer consultants, including the members of the Diocesan Finance Council, to assist the diocesan finance officer, Pete McNamee, and his staff in using available technology to improve the timeliness and formatting of reports for program, parish, school and institutional use. Many of the reports will be available electronically. In addition, these consultants are reviewing the processes and staffing to suggest ways to help the small staff in accomplishing efficiencies in the operation. Following is more detail of the issues I asked to be addressed and our accomplishments in these areas to date.

Balance the operational budget – There are some costs that are reported in current expenses that are operational expenses we cannot control. The largest of these have been the costs associated with the past sexual misconduct of a very few priests. We take seriously our responsibility to offer pastoral care and outreach for those injured by these few priests and will continue this healing ministry as long as necessary. Here is the recent history of annual operational deficits: FY 2001-2002: $153,237, FY 2002-2003: $501,046, FY 2003-2004: $691,965, FY 2004-2005: $336,984. I am pleased to report we are on target for ending FY 2005-2006 with no operational deficit. This was achieved in part by not filling staff vacancies, not being able to approve any salary increases for staff, a decrease of travel or funding travel with grants from outside sources, and reducing other operational expenses. Current budget to actual reports will soon be available electronically to enable managers to make more timely adjustments mid-stream. We are using technology to streamline processes. In addition, we outsourced our annuity payments and associated IRS reporting responsibilities at a great cost savings.

Increase cash flow – We have increased fundraising and grant request efforts; sold some investments; increased or implemented fees for some labor-intensive planned gifts and other financial processing; with the increase in market interest rates, we were able to implement daily bank account sweeps; we gratefully arranged building project loans from the Diocese of Great Falls-Billings, the Foundation for the Diocese of Helena, and the Ravalli County Bank in Hamilton; and as generously recommended by the priests – even given their local financial hardships – increased the diocesan assessment from 8.5% to 10%.

Raise and meet the Diocesan Offertory Program goal – The goal was raised from $1,470,000 to the current campaign goal of $1,600,000, which I am pleased to report has exceeded 100% in pledges. Pledges and payments continue to be received, raising hopes of far exceeding the goal in cash receipts by May 1. I am very grateful to the DOP donors, priests, Glenna Obie and others on staff, the Diocesan Stewardship Advisory Council, and parish stewardship staff for making this great accomplishment possible.

Increase stewardship at all levels – I am grateful to Our Sunday Visitor for a grant that paid for 13 of 17 participants from around the diocese to attend a national stewardship conference. Many from across the state of Montana attended a stewardship conference hosted by both dioceses. Glenna Obie provides parishes and schools with local stewardship assistance on request. More parishes are appointing paid or volunteer stewardship directors. Our shared stewardship vision is one in which people see the gifts God has provided and make a return in conscience.

Timely, clear and transparent financial reporting – With this issue, we are up to date on annual audit reporting; the Diocesan Finance Council is finalizing improved reporting formats for the financial position, budget to actual income and expense, trending graphs, and ratio analysis. These reports will be available electronically for me, Pete McNamee and other managers, parishes and advisors; and the Deposit and Loan Fund is now software based, updated continually, and will soon be available for parishes and school staffs to access electronically. Our outside investment managers changed their report formats, which saved us time in our analysis and reporting. We have improved procedures and reports to enhance the efficiency and effectiveness of cash controls and accounts payable processing. We are using the latest available versions of our financial software.

Improve Deposit and Loan fund policy compliance, approval, and evaluation of loan performance – Updated loan policies are in the process of final edit and approval; names are being gathered for me to appoint a Diocesan Loan Committee that will analyze requests for loans based on objective criteria, analyze ability to repay, and provide ongoing evaluation of loan performance. Based on their analysis, the committee will make timely recommendations to me through the Diocesan Finance Council for action to be taken when a loan is not performing in accordance with the agreements made.

Improve the appearance and financial stability of Catholic Cemeteries – We have reorganized Catholic Cemeteries and initiated a plan that has lifted the current debt burden. We are addressing the remaining budget issues and plan a capital campaign to pay for improvements in cemetery appearance for the long term.

Conduct a capital campaign – The last diocesan-wide capital campaign to enhance the financial base of the diocese and its programs, parishes, schools, and institutions was in 1981. We are long overdue. Planning for this campaign has been initiated. As you have read elsewhere, we are gratified by the generosity of selected donors who have funded Sr. Rita McGinnis, SCL, and our Pastoral Planning Office. The Diocesan Pastoral Council and other groups are well on the way to presenting a plan for the future that will be the basis of the case for the capital campaign. I am also grateful for the helpful insights I received during my pastoral visits to all of the diocesan parishes, schools and institutions.

We are finalizing a five year plan proposed by the business office staff to provide optimal reports and service using available resources. Some items of the plan are providing: more electronic access to financial information; data using a new grant tracking program; more payroll, personnel, and cash management assistance to parishes and schools; more rapid turnaround on inquiries as well as requests for approvals needed in accordance with diocesan policy; policy updates; and much more.

I encourage you to study the accompanying information. If you have any comments or questions, please feel free to write to Pete McNamee.

I am grateful for your continuing stewardship offerings of time, talent, and treasure to the Diocese of Helena as we together spread the Good News. May God bless you and yours as we walk together on our journeys of faith.

Sincerely yours in Christ
Most Reverend George Leo Thomas
Bishop of Helena

Published in The Montana Catholic, Vol. 22, No. 1, January 20, 2006.