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Archdiocesan Finances

Over the last several years the Archdiocese of Detroit has implemented many changes in how the business of the Archdiocese is conducted. While we have made significant progress toward operating within a balanced budget, our efforts and diligence must continue.

We are grateful to all the faithful who provide the resources with which the Church operates in southeast Michigan. We are committed to being good stewards of your resources and to operate with integrity and transparency.

Frequently Asked Questions

What is the current financial condition of the Archdiocese of Detroit?

The Archdiocese started the current fiscal year (July 1, 2018 – June 30, 2019) with a planned budget surplus of $2,334,099. This surplus is similar to net income in for-profit organizations. The Archdiocese experienced a $13,271,789 increase in net assets for the 2017-2018 fiscal year that ended June 30, 2018. In the previous fiscal year of 2016-2017, the Archdiocese had an increase in net assets amounting to $11,655,450. Increases in the net assets noted above included gains on invested funds in the amounts of $11,568,561 and $10,770,821 for fiscal years 2016-2017 and 2017-2018, respectively.

In the archdiocesan balance sheet for the year ended June 30, 2018, the total net assets for the Archdiocese totaled $13,536,408. This is the similar to retained earnings in a for-profit corporation.

These results reflect Archdiocesan Operations, related departmental and fund operations, and investment returns. These totals do not include the change in net assets generated by the archdiocesan Endowment Foundation and the Priests’ Pension Plan, which are separately incorporated entities.

Audited annual financial reports for the Archdiocesan Operations are published on the archdiocese website.

Has the Archdiocese improved its financial situation?

In recent years, the Archdiocese implemented several measures to control Archdiocesan Operations spending, conserve cash, and operate within a balanced budget. The expense reductions were primarily achieved through cost control measures including staff downsizing, program service cutbacks, and curtailing archdiocesan subsidies.

The Archdiocesan balance sheet for the year ended June 30, 2012 reflects that the total net asset deficit for the Archdiocese amounted to $47,262,137. Over the last six years, as a result of reducing operating expenses, along with good market returns on invested funds, the net assets have increased $60,798,545, from the $47,262,137 net asset deficit noted above to a surplus of $13,536,408. It has been several years since the overall net asset balance has been positive for the Archdiocese.

While substantial progress has been made, especially in achieving a balanced archdiocesan operating budget, it will still be a matter of years before the Loan Deposit Program is returned to full health, however, great strides have been made over the last decade. Archdiocesan Operations will continue to control spending, determine the rationale and sustainability of every archdiocesan financial subsidy, and ensure it has adequate cash reserves. Lending practice reforms and interest rate adjustments have helped stabilize the Loan Deposit Program. Over the last six years the Loan Deposit Program has seen an improvement in its net asset balance increasing by $30,365,219 from a net asset deficit of $50,804,653 as of June 30, 2012, to a net asset deficit of $20,439,434 as of June 30, 2018.

How much does the Archdiocese owe to outside entities?

In December 2011, the Archdiocese refinanced a municipal bond issue for the Pontiac Vision 2000 Schools project that initially totaled $22.1 million and had been paid down to approximately $10.4 million. By restructuring and reissuing these bonds, the Archdiocese eliminated its reliance upon a letter of credit from the bank, replaced a variable interest rate with a fixed rate, and reissued the bonds with a similar term (the time period for paying bondholders). The total amount owed on the bond is $6,803,785 as of June 30, 2018.

What is the Archdiocesan General Fund and how has it performed?

The General Fund represents longer term assets invested for Archdiocesan Operations. The General Fund complements the cash reserves held for operating purposes in commercial bank accounts primarily on behalf of parishes and schools.

The General Fund is invested in the financial markets to generate revenue commensurate with the goals and objectives of that fund. Proceeds from these investments are for the specific purposes established for that fund.

Investment Account

Balance
June 30, 2014

Balance
June 30, 2015

Balance
June 30, 2016

Balance
June 30, 2017

Balance
June 30, 2018

General Fund

$97.4 million

$108.0 million

$118.6 million

$133.0 million

$152.8 million

Where has the Archdiocese invested General Fund assets ?

Archdiocesan investments are in diverse portfolios of domestic equity, international equity, fixed income, and alternative investments including mutual funds tied to market indexes such as the Dow Jones Industrial Average and Nasdaq Composite Index. A private-sector firm, CapFinancial Partners, LLC, advises the archdiocesan Finance Council on these investments.

Who manages the Archdiocese’s financial assets and operations?

Archbishop Vigneron is ultimately responsible for the overall stewardship of archdiocesan property and financial assets. The daily financial management of archdiocesan operations and investments are the responsibility of Central Services staff, specifically the Department of Finance and Administration, which reports to the Moderator of the Curia. In the private sector, the Moderator of the Curia has responsibilities similar to a chief operating officer and reports to the Archbishop.

The archdiocesan Finance Council, a nine-member committee comprised of priests and lay people with operational, financial, banking, auditing, investing, and other backgrounds, provides oversight and advice to Archbishop Vigneron on all financial matters. The archdiocesan College of Consulters, which is the priest council of advisors to the Archbishop, also provides input on administrative and financial issues.

Plante Moran, PLLC annually audits the financial statements of certain archdiocesan funds including its Archdiocesan Operations, designated funds, properties, the Loan Deposit Program and archdiocesan collections. The Archdiocese has consistently received unqualified (also known as “clean”) audit opinions from Plante Moran, PLLC. The annual reports are published on the archdiocesan website.

Posted: March 2019
Reference this information directly at http://www.aod.org/sharingthelight/finance/