Lawyers Battle to Properly Value Dozens of Buffalo Diocese’s Properties

Posted on: October 21, 2020 Catholic Church Sexual Abuse

Lawyers Battle Properly Value Buffalo DioceseThe Diocese of Buffalo filed for bankruptcy in February of this year in the wake of mounting clergy sexual abuse claims. The diocese opted for bankruptcy protection after seeing no other viable option to continue operating given the potential total future obligations the pending sexual abuse lawsuits could entail. The diocese continues to believe that bankruptcy doesn’t hurt abuse survivors, but only helps them by creating a compensation process that equally divides up funds among all abuse survivors, instead of favoring those who filed first.

Part of the bankruptcy process is evaluating diocese assets like real estate and seeking maximum market value for its creditors. In this case that means getting the highest price possible for diocese property to put into a compensation fund and allocate to clergy abuse survivors. While this may seem straightforward, the Diocese of Buffalo argues that it is not that simple.

The article gives the example of the potential sale of Archbishop Walsh High School to show what the bankruptcy court may have to sort through. In 1992 the Diocese of Buffalo leased this property to the school for $1/year. In December of 2019, the diocese thought they had a deal in place with the operators of the school to sell it to them for $150,000. However, the sale was put on hold with the filing of Chapter 11 bankruptcy by the Diocese.

Diocese lawyers asked Chief Justice Carl L. Bucki, of the U.S. Bankruptcy Court in the Western District of New York, to allow the sale to go through at the stated price. They are trying to justify the price by saying the building needs an expensive new roof and the current lease for $1/year is in effect until 2041. In contrast, lawyers representing abuse victims say the sale price is too low and the diocese has undervalued it. Collectively, the Buffalo diocese could have upwards of $16 million in property value, so why the commotion about $150,000 in the larger picture?

The diocese owns about three dozen properties. If the full value of each and every property is not actually realized, it could have a significant effect on the total amount of money available to compensate clergy abuse survivors within the Diocese of Buffalo. The diocese owns the buildings and grounds of Cardinal O’Hara High School in the town of Tonawanda, St. Mary’s High School in Lancaster, Bishop Timon-St. Jude High School in Buffalo, Notre Dame High School in Batavia and DeSales Catholic in Lockport. Additional properties also being reviewed for sale include: vacant parcels in Hamburg, Grand Island and Dayton; various city parking lots and garages; three priest retirement homes; the Catholic Center on Main Street; Christ the King Seminary in Aurora; and St. Joseph Cathedral on Franklin Street.

The entire article can be viewed here.

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