Thursday, September 7, 2006

The Catholic Diocese of Arlington is a prime example of the power of spiritual fundraising: When Bishop Paul S. Loverde announced a $75 million capital funds drive four years ago, local Catholics contributed 150 percent, or $114 million.

That seemed par for the course for one of the country’s fastest-growing dioceses in some of the nation’s richest counties: Loudoun, Fairfax and Prince William.

More than 12,000 Catholics join the diocese each year, with some parishes gaining more than 30 new families a month. The number of registered Catholics has shot up 42 percent in the past decade to more than 400,000 people.

But the diocese has been slow to spend the millions of dollars needed to shepherd Catholics arriving from all corners of the globe, resulting in large cost overruns.

Costs for a 188,000-square-foot Catholic high school, for which ground was broken Wednesday in eastern Prince William County, have soared 140 percent from $25 million to $60 million.

A new priest’s retirement center to be built in Annandale was supposed to cost $5 million. It’s now estimated at $6 million, a 20 percent rise, with construction moved to next year. A site has to be selected for a diocesan spirituality center, for which $5 million was raised.

Catholic Charities, which was promised $10 million from the diocese, has yet to receive any payouts to any of its projects. Renovations to a homeless shelter in Alexandria are scheduled for November.

While some local Catholics are oblivious to the delays, others are chafing at the bit, especially since the diocese knew by 2003 that its capital funds drive had come in $39 million over goal.

“Where is that approximately $40 million going?” asked a recent issue of Les Femmes, a Catholic watchdog newsletter published in Woodstock, Va. “With all that extra money, why the delay?

“Meanwhile, the diocese fiddles and prices sure aren’t dropping. Watch for another campaign down the road justified by rising prices.”

Diocesan officials blame Northern Virginia’s red-hot real estate market for the rise in cost for the new high school. Designed by MTFA Architecture of Arlington with a series of graceful arches over the entrance curved to resemble Gothic stained-glass windows, it was supposed to open this month.

“We were trying to look at where we were, what the costs would truly be and trying to evaluate the best process for going forward,” said Robert Mueller, director of development for the diocese. “This is one of the only Catholic high schools [in the country] breaking ground this year.

“We’re a young diocese and a growing diocese. We’re not like a Northeastern diocese with all the institutional structure there. We’re just building it.”

One economist said no rise in construction costs could justify a 140 percent increase.

“There must have been some design creep,” said Ken Simonson, chief economist for Associated General Contractors of America, a national trade association for the construction industry based in Arlington. Construction materials, he added, rose 30 percent to 40 percent since 2003 and steel costs rose 50 percent to 60 percent. Wages in Prince William County rose 26 percent from 2000 to 2005, according to the county’s economic development office.

Delays would be normal only if the money were slow coming in, said Matthew Paratore, secretary-general for the International Catholic Stewardship Council, which helps dioceses with their fundraising.

“If you do have the money, you proceed,” he said. “If the plans are made and the land is there, you start digging the hole.”

What the diocese did do was pay $2.2 million to Community Counseling Services, the New York firm that conducted the campaign. It then sold $26 million in tax-exempt bonds to help finance the high school. It funneled $26 million from the capital funds campaign back to parishes for church building and improvement projects.

But Catholics weary of their offspring making 20- to 30-mile commutes to schools in the northern part of the diocese saw little progress. Although the diocese promised the high school would break ground in the spring of 2004, nothing happened. The following December, the Arlington Catholic Herald explained that construction costs in Northern Virginia had skyrocketed and nothing would be done until a study was released in June 2005.

But the diocese knew property values were rising. In 2001, reserve funds were used to buy a $950,000 home next to the bishop’s residence on North Carlin Drive in Arlington, where Bishop Loverde and his secretary, Brother David Eddy, live. The investment house, which has been kept vacant, is now worth $1,044,700, according to real estate records.

The bishop’s residence was purchased by Bishop Thomas Welsh for $120,000 in 1974 and has appreciated to $1,058,500. The idea, now on hold, was to sell both homes and use the funds to renovate a disused convent for a larger home for the bishop next to St. Thomas More Cathedral about a mile away.

“Since when is the diocese in the real estate business?” asked Joe Strada, a Catholic activist who attends St. Andrew the Apostle parish in Clifton. “And what will you do with these profits, if you’re a nonprofit?

“Why aren’t we building facilities for the diocese? They’ve sat on these projects for five years and the cost of building them has soared in the meantime.”

But Bishop Loverde is a prodigious fundraiser. His capital funds campaign has earned $3.5 million in interest. His annual Lenten appeal brought in $6.3 million last year and $8.6 million this year, a 36 percent increase.

“The usual is a 5 [percent] to 10 percent increase,” said Bill Bannon, president of Bannon Associates, the Joliet, Ill. firm that was paid $60,000 to handle this year’s appeal.

“I think the people in that diocese are happy with the bishop there,” he added, “and the diocesan staff has really gotten out and worked with the parish leadership.”

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