The Diocese of El Camino Real is running out of cash, and poor communication with the bishop isn’t helping, according to the diocese’s standing committee. In a public letter released Oct. 31, the standing committee revealed that an outside auditor is concerned that neither diocesan management nor the directors of the diocesan corporation have adequately fulfilled their fiscal responsibilities.

The financial shortfall is also making early retirement negotiations between the standing committee and the Rt. Rev. Richard L. Shimpfky more difficult.

“We are finding it increasingly difficult to obtain accurate information from the bishop of our diocese,” the letter said. “We are deeply concerned about the state of the diocese. We are also concerned and troubled about what appear to be clear canonical violations by the bishop.”

The financial shortfall is a separate concern from alleged canonical offenses against Bishop Shimpfky that are alluded to in the letter, according to standing committee president Dr. Gordon W. Gritter, who added there is no evidence of criminal misconduct by the bishop.

Dr. Gritter said the standing committee released its letter prior to filing any charges against Bishop Shimpfky because the matter had become serious enough that it was necessary from a fiduciary duty perspective to make a detailed disclosure to the stockholders of the corporation.

“We are saddened that we must take these actions, but at this time we see no alternative,” the letter states. “We ask for your prayers as we move forward in our efforts to restore the integrity of this diocese.”

The standing committee first brought its canonical concerns to the attention of the Presiding Bishop three years ago, Dr. Gritter said. According to its diocesan constitution, El Camino Real is required to undergo a thorough review every three years. The report issued in 2000 brought a number of longstanding issues out in the open. Earlier this year, Bishop Shimpfky took a medical leave of absence for depression. Shortly after he returned, he announced a timetable which called for the election of his successor in September 2005. Aside from being removed for cause, Bishop Shimpfky is not required to step down until he reaches the mandatory retirement age of 72 in 2012. He is said to be holding out for a financial settlement.

The precarious financial condition of the diocese means there is little room to negotiate.

“The Diocese of El Camino Real is running out of cash and nearly out of time to do anything about it,” reported the diocesan newspaper, The Mission Bell, in its November 2003 issue. Several problems — a poor local economy, parish alienation from the diocese, and nationwide calls for withholding contributions due to General Convention actions — have resulted in a considerable loss of income in a number of congregations. Many of them are behind in payments to the diocese and pleading for assessment relief. The situation is compounded by poor financial documentation and a highly critical audit communication first issued in September. Shortly after publication of the letter, the treasurer resigned.

“It has become clear to us the diocese does not have effective oversight of its fiscal affairs,” said a preliminary draft prepared by Hayashi & Wayland Accounting & Consulting. “Numerous findings and recommendations from prior years’ audit management letters continue to be unresolved.”

Michael Rehill, a lawyer previously retained by Bishop Shimpfky to assist with severance negotiations, said his client has not yet been formally accused of any misconduct. He described the standing committee’s letter as a collection of inaccuracies, illogical reasoning and outright misrepresentation of facts.