Iowa's Methodist churches advised to cut ties with Boy Scouts troops until bankruptcy case is resolved
The BSA filed for Chapter 11 bankruptcy protection in February 2020 to protect it from hundreds of lawsuits by victims who have said they were sexually abused during their time with the organization. A federal bankruptcy judge in Delaware last week signed off on part of an $850 million settlement agreement BSA reached with a majority of the attorneys for sex abuse claimants in the case.
The $850 million offer was praised in July as the largest settlement of sex abuse claims in U.S. history, according to USA Today. BSA made past assurances that the organization had insurance to cover chartered organizations — the civic and religious groups that host and sponsor BSA units — according to a letter sent Wednesday by Iowa Area Bishop Laurie Haller.
But her letter said BSA did not have "enough or sufficient" coverage to protect chartered organizations. The letter also said that local churches may have to pay legal fees to defend themselves in lawsuits.
"They are leaving their chartered organizations out on a limb by themselves," Haller wrote in the letter. "The local churches are at risk of having to pay significant sums to victims to compensate them for the damages they suffered at the hands of some scout leaders ... All of this is because the BSA did not fulfill their promise to have enough insurance to protect the local churches."
The Rev. Bill Poland, with the Des Moines-based Iowa Conference of the United Methodist Church, said the letter is similar to one being sent out by Methodist churches across the country. Poland has pastored at three churches with Boy Scout troops. Faith is an integral part of scouting, he said.
"While we highly value scouting, we also want to make sure we're doing our best to protect our local churches and all of the people in them," Poland said.
Specifically, the letter recommends that churches that currently charter a scouting unit not renew the agreement with their local councils, although churches can extend current agreements until Dec. 31, the letter said.
Churches with existing charters could also decline to renew charters but sign facilities use agreements with local councils through Dec. 31. This would essentially allow local councils to lease spaces from churches.
"After Dec. 31, we should be in a better position to see how the future will unfold," the letter said. "Once a BSA plan is approved by the bankruptcy court, we will know better how to proceed."
The Des Moines-based Mid-Iowa Council of the Boy Scouts of America covers 27 counties in central Iowa. Matt Hill, the council's executive, said the move will affect 50 Cub Scout, Venture and Scouts BSA groups in central Iowa.
The Mid-Iowa Council supports about 2,900 volunteer leaders and 10,600 Boy Scouts and Cub Scouts in 27 counties, including the Des Moines metro and Ames.
"Scouting is going to continue to remain viable," Hill said. "We value our partnership with all of our chartering organizations and, on a local level, we've had a longstanding relationship with so many of these charter partners."
Nationwide, the United Methodist Church charters almost 20% of Boy Scouts of America units serving more than 350,000 youths, according to the Memphis Conference of the United Methodist Church. Poland said officials don't have an exact count, but Methodist churches serve at least 135 Boy Scouts units in Iowa.
On Aug. 17, the United Methodist Church joined the Roman Catholic Church in objecting to the Boy Scouts of America's reorganization plan in federal bankruptcy court in Delaware. The churches argued that the reorganization shifted much of the burden for paying survivors to the chartered organizations that could be sued.
The plan also denied chartered organizations adequate insurance coverage to shield them from lawsuits, the brief said.
"While the Catholic and Methodist Committees would like to see debtors emerge from bankruptcy, undermining chartered organizations’ contractual rights is not a proper path forward," the brief said.
It has still not been determined yet how much each local council will contribute to a victims' trust fund, according to USA Today. After the Boy Scouts of America filed for bankruptcy, the Mid-Iowa Council of the Boy Scouts of America did not file for bankruptcy because BSA and the Mid-Iowa Council are legally separate entities.
Hill said he could not say how much money the Mid-Iowa Council may have to pay because negotiations are ongoing.
A hearing was scheduled for Wednesday to review the latest BSA reorganization plan, which would have been the next milestone in the case. Attorneys for the Boy Scouts of America postponed the hearing until Sept. 21, casting uncertainty over the future of the case, according to Insurance Journal, an insurance trade publication.