Parish schools and seminaries face overhaul

The tough decisions have only just begun.

In less than three years in Boston, Cardinal Sean P. O'Malley has already sold off the historic archbishop's mansion to come up with funds to pay abuse victims, and he has closed 62 parishes to respond to a shortage of cash, priests, and worshipers.

But now, as he seeks to stabilize the archdiocese's overall financial position, he faces several looming long-term questions: whether to close more of the archdiocese's struggling parish schools, how to deal with the underenrolled seminaries, and whether to cut benefits for the growing number of retired priests.

''The cardinal currently has all major archdiocesan operations under review," the archdiocese declared bluntly in one of several reports released to the public yesterday.

O'Malley outlined plans yesterday to bring the operating budget of the archdiocese into balance by cutting central administration staff and programs. But deeper, longer-term financial problems remain in key areas of the archdiocese's activities and institutions.

The archdiocese has only hinted at the changes to come beyond those in the central administration. But the broad contours of other cuts are beginning to emerge.

First, O'Malley is clearly planning a major overhaul of the archdiocesan school system, which is not really a system at all, but an unwieldy alliance of multiple parish schools overseen by parish priests, many of them in low-income communities that cannot raise enough money to keep the schools open. O'Malley last week accepted the resignation of the school superintendent, and yesterday he said he is searching for a new cabinet-level secretary of education; he has been approving the closing of several schools a year for the last several years, reflecting enrollment levels that have been plummeting for decades.

In an interview last week, the businessman named by O'Malley to oversee the schools overhaul, Jack Connors Jr., said he expects to recommend that O'Malley take a dramatic step to show his support for Catholic education: build a new elementary school in a low-income neighborhood in Boston. But he and O'Malley have also made it clear that it is likely more schools will have to close, school fund-raising will have to be dramatically improved, and the schools will have to come together in some kind of system so they can share resources and knowledge more effectively.

Second, O'Malley is seeking to strengthen seminaries at a time when the number of seminarians is at a historic low. O'Malley oversees two seminaries, Blessed John XXIII, in Weston, which he said yesterday is fiscally solvent, and St. John's Seminary, in Brighton, which is not. St. John's is located in a huge building which is expensive to run and to staff -- costs that become more difficult to justify given its dwindling student body.

Boston College has offered to purchase St. John's Seminary for $40 million, but O'Malley said yesterday he is not inclined to sell it at this time.

But some kind of change or consolidation seems inevitable: Boston College, which boasts the largest theology faculty of any Catholic university, is located across the street; Weston Jesuit School of Theology, currently located in Cambridge, is planning to affiliate with Boston College; and the two schools are planning to create a new School of Theology and Ministry, which will absorb Weston Jesuit and several Boston College departments, on land located next to St. John's Seminary and owned until recently by the archdiocese.

O'Malley has reduced staff at the seminary, and has attempted to expand enrollment by bringing in seminarians from other dioceses; he said yesterday that he sees potential for the seminary to become regional in nature.

One of the most difficult issues facing O'Malley is how to deal with clergy pensions.

The archdiocese's initial proposal, last year, to cut priest pensions, was greeted with a furious outcry not only from priests, but from parishioners who could not understand why their annual Christmas and Easter collections, given to take care of retired priests, were not enough for that purpose.

Yesterday, O'Malley released extensive data about the clergy funds, and Chancellor David W. Smith insisted they had been managed properly.

But they face unfunded pension liabilities of $135 million, and the situation is worsening as retired priests live longer and healthcare costs rise.

Benefit cuts are still on the table, according to the documents released yesterday, one of which declared, ''the Clergy Fund Advisory Committee is currently considering several steps to address this concern, including reductions in benefits through plan design changes and greater cost sharing with the priests and parishes."

''The pension situation is continuing to deteriorate," said Cynthia Deysher, a co-chair of the Council of Parishes, a lay organization that has asked Attorney General Thomas F. Reilly to examine the archdiocese's management of its pension funds. ''There was very good disclosure around it, but the news is not good."

The archdiocese will also examine the regionalization of services, which could mean that certain programs, such as religious education, or administrative functions, such as bookkeeping, are shared among several neighboring parishes, according to James F. O'Connor, an accountant-turned-banker who is overseeing the preparation of a strategic plan for the archdiocese.

Michael Paulson can be reached at mpaulson@globe.com.