Paycheck Protection Loans Helped Archdiocese and Many Parishes in Early Stages of Pandemic
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The Archdiocese of St. Paul and Minneapolis is among dioceses across the country whose central offices have received loans from a federal paycheck protection program to help retain employees as the COVID-19 pandemic spreads said Tom Mertens, CFO.
About three-quarters of the Archdiocese’s 186 parishes have also applied for PPP loans, he said.
“I am not aware that anyone has been refused a loan,” he said. “We have had parishes that have repaid loans, or that have not accepted a loan after being approved, because the first economic blow of the pandemic was not as bad as they had expected.”
The PPP loan program was part of the emergency economic aid passed by Congress early last year to help small businesses and nonprofits during the pandemic. Congress passed another emergency relief package in late December that includes a revised P3 loan program, and is debating a $ 1.9 trillion relief plan proposed by President Joe Biden.
The Archdiocesan Catholic Center – which as an organization employs around 140 people – is not eligible for the second-round PPP, which requires a drop in gross revenue of 25% or more in a quarter of 2020 compared to in the same quarter in 2019, said Mertens.
About 20 parishes to date have applied for a second PPP loan. Nominations are expected by the end of March, he said.
A recent Associated Press article on the Church and the P3 loan program was inaccurate, in part because he noted the assets held by the Catholic Church as a whole, without acknowledging that in some cases parishes are separate entities, Mertens said. Overall, for example, three parishes might look good, but the financial health of one effectively masks the lack of two, he said. The article also did not distinguish between unrestricted assets that could be used for general operations and restricted assets, such as scholarship funds, which are only available for education purposes, a Mertens said. The intention of the economic relief was to allow employers to retain their employees in order to avoid the negative effects of unemployment on the economy.
Overall, government PPP loans have enabled the Catholic Center and parishes to avoid layoffs and time off during the COVID-19 pandemic, Mertens said. Keeping employees at work means that the many community services provided by parishes continued during these difficult times, he said.
“The PPP came out when there was huge uncertainty and those we serve were in need,” Mertens said. No one knew how long the pandemic would last or “how long the churches would be closed.” It was a real problem from our point of view here at the Catholic Center, ”he said.
“Our source of income is 80% assessment income that comes directly from the parishes. And if their doors are closed and the income does not come from them, ”the Archdiocesan Catholic Center would have run out of money in less than six months, Mertens said.
The $ 1.98 million loan will not have to be repaid if employees are retained, which has happened at the Archdiocesan Catholic Center, Mertens said.
Thanks to generous parishioners and other donors, the local church slowdown so far has not been as severe as initially thought, although uncertainty remains as the pandemic continues, Mertens said. Many parishioners who could afford it increased their giving to the Church, he said.
“We had really stepped up parishioners realizing the situation the Church was in and giving more,” Mertens said. “We have been blessed by their actions.
A summary of the financial report of the Archdiocesan Catholic Center for the financial year 2020, from July 1, 2019 to June 30, 2020, with comments from Mertens and Bishop Bernard Hebda, has been printed in the December 17 issue of The Catholic Spirit. For more detailed financial statements and an independent auditor’s report, go to archspm.org/finance-accounting.
Parishes adapt as COVID-19 pandemic enters second year, many grateful for PPP loans
Father Leo Schneider of Holy Name in southern Minneapolis is preparing for his second faith-filled book study via Zoom, a way to continue reaching parishioners amid the COVID-19 pandemic.
He saw the weekend’s supply drop in the first year of the pandemic, but is grateful for a federal paycheck protection program loan of around $ 56,000 that helped retain staff. , and electronic donations to the parish provide a stable base of funds.
“We’re behind what we used to be, but not bad,” said Father Schneider, who is also the pastor of Saint-Léonard de Port Maurice in southern Minneapolis. It’s hard to see very far, he said, but so far “it’s not that bad considering everything.”
As the pandemic enters its second year in March, Tom Mertens, chief financial officer for the Archdiocese of St. Paul and Minneapolis, said many of the Archdiocese’s 186 parishes could provide similar reports on their financial situation. .
Overall, parish plate and envelope donations, in total, since March 2020 compared to 2019 have declined, but not more than 6% in a calendar quarter, Mertens said. In the three months ended in March 2020, just at the start of the pandemic, it was less than 1% from the previous year; in the quarter ended in June 2020, it was down around 3%; over the three months ended in September, it is down by around 6%; and in the quarter ended in December, it was down less than 3%.
Some parishes have struggled, with offerings dropping 50 to 75 percent, Mertens said. During the fourth fiscal quarter of 2020 – April through June – the Archdiocese gave parishes a discount on assessments, money donated to support programs and other efforts, which resulted in savings of nearly $ 20,000. ‘a million dollars for parishes, Mertens said.
Another form of government assistance could help qualifying businesses and nonprofits this year: a pandemic employee retention credit of up to $ 7,000 per employee per quarter in 2021, Mertens said.
The archdiocese’s 91 Catholic primary and secondary schools are doing well, with some struggling more than others, said Jason Slattery, director of education. Many elementary schools are heavily dependent on parish investments and tuition fees, he said.
“Fortunately, those two levers have been maintained until now,” Slattery said.
Category: Local News
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