The Archdiocese of Santa Fe has filed a complaint against the U.S. Small Business Administration, saying the federal agency is illegally blocking it from applying for a low-interest loan from a program aimed at helping small businesses impacted by the novel coronavirus because the archdiocese is involved in a bankruptcy proceeding.
The complaint was filed Tuesday in the archdiocese’s pending Chapter 11 bankruptcy case in U.S. Bankruptcy Court.
In it, the Catholic organization says the federal government specifically ruled nonprofit entities and those in bankruptcy are not ineligible to receive 1 percent interest loans from the Paycheck Protection Program, which is part of the more than $2 trillion federal relief package being dispersed to help steady the economy during the pandemic.
But the archdiocese says the form applicants must complete says applications from entities involved in bankruptcy proceedings will not be approved.
“The parishes derive a significant portion of their revenue from offertory,” the complaint says, “and a significant portion of the offertory collections occur during Holy Week which includes Easter Sunday Mass. Because the parishes have been closed … the Plaintiff is experiencing a significant decease in revenue and anticipates that for as long as the ‘stay at home’ order remains in effect, it will struggle to continue making payroll payments.”
Spokeswoman Celine Baca Radigan said in a written statement Friday that the COVID-19 pandemic significantly affects the archdiocese’s “mission to safeguard the sanctity of life and provide pastoral care” in its 93 parishes, 226 missions and 16 schools throughout the region.
The archdiocese is asking the court to rule that the Small Business Administration overstepped its authority when it determined entities going through bankruptcy weren’t eligible for the money and change the part of the form that keeps them from applying.
The petition acknowledges the Small Business Administration announced April 16 that the $349 billion set aside for the Paycheck Protection Program was already exhausted.
But it says “upon information and belief, Congress has reached a deal to allocate additional funds” to the program and the archdiocese wants to be able to apply for them.
The Small Business Administration did not respond to messages seeking comment for this story.
The archdiocese filed for bankruptcy in 2018 in the wake of clergy sex abuse lawsuits that began in the 1990s. According to news reports, the archdiocese claimed about $49 million in assets, including real estate, but not including assets the archdiocese said it holds for parishes.