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STEUBENVILLE -- The Diocese of Steubenville has pulled the plug on its cathedral renovation plan, blaming the reversal on financial fallout from the theft of hundreds of thousands of dollars by a former employee.
Bishop Jeffrey M. Monforton announced his decision in the May 13 Steubenville Register, the diocesan paper.
"It cannot be a financial burden, an albatross, to the diocese," Monforton said. "We have a building that has not been cared for in more than a decade and it is not financially prudent to continue the plans to renovate Holy Name Cathedral.
"I would not have started the project if I knew the true financial picture of the diocese at that time," he'd told The Register.
Holy Name was closed in 2014 after plans to renovate the aged structure were originally announced. Founded in the 1800s, it was designated the cathedral when the diocese was created in 1944.
Monforton suspended major expenditures in the diocese in 2018, including the cathedral renovation project, once the investigation into the diocesan finance department had begun.
The irregularities it uncovered included a decade or more of payroll taxes that had been collected but never turned over to the Internal Revenue Service. When the omission was uncovered, the Diocese had to cover not only on the unpaid payroll tax, but also the penalties assessed by the IRS.
Former comptroller, David Franklin, eventually admitted in federal court in July 2020 he'd embezzled nearly $300,000, failed to report the illicit income on his taxes and that he'd collected payroll taxes from employees of the diocese, the Office of Social Ministry and the Mount Calvary Cemetery Association but never turned the money over to the Internal Revenue Service, eventually costing the diocese an additional $999,713 in interest and penalties on top of the nearly $2.8 million payroll tax debt as well as the employer portion. In exchange for his guilty pleas, Franklin spent 285 days in a federal prison and was released 81 days early, then allowed to return to Kentucky. Jefferson County prosecutors moved to have him returned to Ohio to complete the balance of his 18-month state sentence. He also was ordered to make $299,500 in restitution, though officials with the diocese say he has not done so.
A month later, Monsignore Kurt Kemo, the former vicar general of the diocese, admitted he'd diverted nearly $300,000 in funds intended for various projects in the diocese, including charitable endeavors, to subsidize his extravagant lifestyle, which had included flying lessons and expensive clothes. Kemo pleaded guilty to two aggravated theft charges and was sentenced to six months in Eastern Ohio Correction Center, served concurrently. Unlike Franklin, Kemo had reimbursed the diocese for the $289,000 he'd diverted to his own uses even before he was sentenced.
Monforton told parishioners the "financial malfeasance that occurred in the diocesan chancery office prior to 2018 provided an obscure and unrealistic picture of our financial health as a diocese."
"Unrestricted funds intended to be used as leverage for cathedral construction were almost entirely depleted in order to pay the principal and the interest incurred for Social Security withheld from the government," he wrote. "This was a terrible financial loss to the diocese and it was necessary for us to cut costs and eliminate chancery staff positions in order to financially move forward."
Monforton told parishioners he's spent the past months trying "to find an equitable solution for our cathedral, but have exhausted all possibilities."
"The cathedral is our mother church and she has been closed for way too long," he wrote. "To attempt to raise the $4 million dollars necessary to reopen the cathedral (as well as, of course, an endowment for its maintenance) is simply unrealistic for a number of reasons. For one, we find ourselves in the Ohio Valley where our entire economy had been invested in fossil fuels and the technology resulting from them, such as the production of steel and the mining of coal. That era, as well as the tens of thousands of manufacturing jobs, is now behind us. So, what do we do in the midst of a population that continues to age and decline consistent with other Midwest "rustbelt" cities and communities? We must find ways to best serve our mission and that means for us to embrace realistic hope."
The diocese is currently polling priests and parishioners to gather in put on possible outcomes, a spokesman said.
"It's just preliminary," he said. "There are going to be a lot more discussions with priests and with parishioners. We want input from all parishioners and all priests, from all 13 counties. We're just in the beginning stages."