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Dallas diocese: bankruptcy is possible

DALLAS, Jan. 23 -- The Dallas Catholic Diocese says its cash reserves are almost exhausted in the wake of a record $119.6 million civil judgment in the sexual abuse case of a former parish priest. A Dallas jury last year ordered the diocese to pay the money to 11 former altar boys who said they were sexually abused by former priest Rudy Kos.

The diocese today published financial records in Texas Catholic newspaper. The diocese says it has less than $1 million in cash reserves, about $6 million in other assets and liabilities of $3.2 million. The diocese has filed suit to force two insurance companies to pay the judgment. Diocese Chief Finanical Officer Michael Weis tells The Dallas Morning News it is possible the diocese will have to declare bankruptcy, if the suits fail. Lawyers for the plaintiffs say the diocese has enough money to pay the judgment. Attorney Sylvia Demarest says, '(The numbers) represent some bean counter's attempt to make the diocese look as poor as possible.' Weis admits that in calculating the diocese assets, auditors didn't include the value of parish property, schools, Catholic Charities, the Texas Catholic newspaper and the diocesan cemetaries, because those properties are held in the name of Bishop Charles V. Grahmann. Plaintiffs' attorneys say parish properties are clearly diocese assets. ---

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