Diocesan finances remain stable in FY 2021 despite COVID-19 pandemic challenges

Combined assets increase by 27% over previous fiscal year, pension funds make positive progress


PROVIDENCE — Despite having to navigate unprecedented financial challenges presented during the first and second years of the COVID-19 pandemic, the Diocese of Providence managed to close out the 2021 fiscal year on very sound financial footing, according to the annual diocesan audited financial statements for its General Fund, Catholic Charity Fund — including its annual appeal — along with Catholic Cemeteries.
As outlined in the report, diocesan combined assets — which include cash, outstanding receivables and investments for the Catholic Foundation of RI, diocesan lay and priest pension funds, medical fund and the Interparish Loan Fund — are up $68.83 million, a 27% increase over the previous fiscal year, for a total of $324 million.
The nation’s booming economic rebound during this time opened the door to a bullish stock market, which boosted the value of combined diocesan investments by $54 million, producing slightly more than a 30% return.
Bishop Thomas J. Tobin, in a letter accompanying the release of the report, said he was pleased that in spite of many unforeseen challenges the year presented, the Diocese of Providence was able to conclude its fiscal year with a positive result.
“I take this opportunity to extend my very sincere gratitude to all of our diocesan family for your wonderful generosity, with a special recognition to those who have supported our diocesan Capital Campaign and our Annual Charity Appeal. I am thankful to the many who have returned to the regular participation at Mass and encourage all who are able to join us. I am also grateful to all who exercise roles of stewardship in our diocese,” Bishop Tobin said.
Diocesan Chief Financial Officer Michael F. Sabatino said that for a year unlike any other in several generations, the pandemic presented a difficult course for the diocese to navigate in running its operations and continuing its charitable outreach to those in need.

“I’m very encouraged with the results, but most especially with our parishes, schools and agencies during a very successful year in what have been very challenging times,” Sabatino said, reflecting on the positive financial report and the magnitude of the times those results were achieved in.
“It’s a tribute to our pastors, our principals, our directors and most especially our faithful parishioners. We’re very encouraged with the results.”
Although the diocese’s Central Administration offices had cautiously reopened its operations by the start of the fiscal year, its parishes, schools and agencies entered July 2020 still grappling with ways to provide the highest levels of ministry and service possible while respecting mandated health protocols.
“Frankly, at the beginning of that fiscal year, Mike Sabatino and I had some serious reservations and unanswered questions about what the year before us was going to bring,” Vicar of Finance Msgr. Raymond B. Bastia, told Rhode Island Catholic.
“We were at the beginning stages of the pandemic, we had closed churches, and our diocesan operations were closed down for a while. We didn’t know what the level of parish contributions would be going forward into that fiscal year. We knew we had to make some cuts, we had to adjust to the financial impact of the pandemic, but in a sense we weren’t sure where we were going to land.”
As the year unfolded diocesan officials became encouraged by how well the diocesan faithful responded to the crisis.
To their surprise, the finance officials found that parishes were able to generate close to the same amount of income during that first pandemic year as they would have during a normal fiscal year.
Even though people were not able to attend Mass in-person, they continued to support their parishes financially by mailing in their contributions or contributing through electronic offertory programs.
Pastors were credited with being diligent in the care of their financial responsibilities during this time, watching expenses, adjusting where they had to, including instituting temporary layoffs when necessary to make ends meet.
“Accordingly, as they were supported by their people, they were also supportive of their diocesan responsibilities, paying those assessments that were necessary for the diocese to continue,” Msgr. Bastia said. “So what was a very pleasant surprise was that we were in a good position. Coupled with that was the remarkable activity of the stock market. Any long-term investments that we had within the diocese benefited with the rise of the market to a level for us that was unprecedented.”
In addition to supporting their parishes to the best of their ability, parishioners also gave generously to the annual Catholic Charity Appeal, which supports numerous diocesan outreach ministries, many of which continued to operate at a high level during these most difficult times, receiving record numbers of requests for assistance.
The St. Martin de Porres Multi-Service Center, for example, functioned as a crucial distribution center for food and supplies for those in need of assistance, despite being closed for its regular in-house programs. Seniors were also able to be tested for COVID-19 and receive vaccinations at the center as they became available.
Although the 2021 Catholic Charity Appeal was conducted in a year upended by the global pandemic, the campaign saw 20,200 donors across the diocese raise $6.3 million, meeting 94 percent of its $6.8 million goal.
“Our Catholic Charity Appeal was very successful in light of the pandemic,” Sabatino said. “It was the result of people’s generosity, knowing that the dollars were being utilized to meet a real need.”
Also during this time, Catholic schools across the diocese were proactive in transitioning from remote learning options to reopening for in-person learning, leading to an increase in enrollments.
“Where applicable, parishes, schools and agencies did take advantage of the federal government’s Payroll Protection Program, as other organizations did, to ensure their programs could continue to operate,” Sabatino said.
Cemetery operations also continued, with staff working within the health constraints that were required — including holding services outside instead of inside a chapel — so they could accommodate families during their time of bereavement.
“They were very adaptive to their circumstances in order to enable families to have the greatest amount of dignity and reverence at a time of loss,” Msgr. Bastia said.
Near the end of the fiscal year, the diocese opened a new $10 million mausoleum that was completed on time and on budget. To date, the new mausoleum has recorded more than $5 million in sales.
As of June 30, 2021, the Catholic Foundation of RI, a separate corporation under the Diocese of Providence, had more than $140 million in assets, making it the 14th largest diocesan foundation in the country. The income from the Catholic Foundation supports various charitable enterprises as selected by their donors.
Also, as of the close of FY 2021, the diocesan Grateful for God’s Providence capital campaign had exceeded its $50 million goal, recording more than $52 million in pledges.
Another positive outcome officials report from the rising investment returns is that both the diocesan Lay Pension Fund and the Clergy Pension Fund made positive progress in FY 2021 toward the goal of achieving fully funded status.
Officials say the biggest challenges they face involve the operation of the diocesan nursing homes and assisted living facilities, including the St. Antoine Residence and the Villa at St. Antoine, as well as St. Clare-Newport.
Although the facilities all register more than 90% occupancy, staffing difficulties, COVID-19 and medical reimbursements continue to hamper operations, something common in other healthcare facilities across the country at this time.
“They’re having the same challenges as others in the industry. It’s getting qualified people to work there and it also involves Medicaid reimbursement rates,” Msgr. Bastia said.
Sabatino, the CFO, noted, “The federal and state assistance they’ve been able to receive has played a major positive impact on operations to maintain staff and overtime.”
Despite the challenges, the picture at the end of FY 2021 was much rosier than Sabatino feared it would be at the start of the year.
“We didn’t know which parishes or schools might start calling in need of a loan to keep operating. Those were really scary times. We’re very encouraged with the results,” he said.
The full report of the annual diocesan audited financial statements for FY 2021, produced by the independent auditing firm Mayer Hoffman McCann, P.C., is available for viewing on the diocesan website at https://www.dioceseofprovidence.org/planning-and-finance. A “user friendly” version of the full report focusing on the ministerial activities supported by either the General Fund or the Catholic Charity Fund will be included in the March 10 edition of Rhode Island Catholic.