Print Issue: May 9, 2002

Archdiocesan CFO Mike McNamara Retires May 15

By Priscilla Greear, Staff Writer

ATLANTA - After having served as the chief financial officer of the archdiocese since 1989, Mike McNamara will retire May 15. Among his legacies will be an archdiocesan system that has in place more internal controls and, for parishes, more centralized policies in their accounting practices and financial management.

McNamara, a certified public accountant and a member of St. Andrew Church, Roswell, has overseen major growth in the archdiocese in his position, responsible for managing the overall finances of the archdiocese. A Mass and reception honoring him were held May 7 at his parish.

McNamara, 63, is grateful for "a lot of good times here in 12 years" and for "being able to instill some good business practices in a religious organization."

McNamara established internal controls for both the parishes and the schools and an internal audit department to see that they comply with procedures.

"I think I've improved some of the accounting systems here," he said. "I put in a lot of internal controls here in the archdiocese that weren't existing before I got in and put in a standard, uniform accounting system in all of the parishes- which some of them are still cussing me for."

He noted that with a uniform accounting system pastors don't have to learn a new system each time they are transferred to a new parish. Also in looking at parish finances "we can compare apples with apples."

Working with then-vicar general Msgr. Edward Dillon, McNamara expanded an archdiocesan deposit and loan fund by improving interest rates. Through the fund, each parish establishes a savings account with the archdiocese, currently with a 5 percent interest rate, and the archdiocese loans out from those savings to parishes for their building projects at less than 7 percent interest.

"When I first started, the deposit to parishes was $4 million. The last time I looked we had over $40 million in deposits to parishes."

Speaking of savings, he has worked to get "some of the most competitive interest rates of any industry in the city of Atlanta."

The CFO's role in parish finances involves limited oversight of general parish finances and more direct involvement with parish debt load, particularly when new debt will be taken on by a parish to build or renovate.

In contrast to parish finances, the finance office is directly responsible for the financial oversight of the programs of the archbishop, which include all the corporations under the umbrella of Catholic Charities, the Department of Catholic Education and other programs of diocesan offices. The finance office is responsible for compiling the budgets prepared by all of these operations and consolidating these budgets into an overall archdiocesan budget.

The finance office grew while McNamara was there from eight to about 16 employees, both because of archdiocesan growth and because the finance office took over accounting and finance for Catholic Charities' corporations. The archdiocesan budget was $8.5 million in 1993 and is projected for next year to be $16 million. The combined revenue for the archdiocese and parishes was $134 million at the end of the 2001 fiscal year, up from $44 million at the end of the 1991 fiscal year.

McNamara, a native New Yorker and Atlantan for nearly 40 years, came to the archdiocese from the Pannell Kerr Forster accounting firm, where he worked for over 25 years and became a partner. He received a bachelor's degree in business administration from Iona College in New York. He is a 25-year member of the U.S. Conference of Catholic Bishops' accounting practices committee, which looks at how new accounting practices affect the church. He helped develop the publication of "Diocesan Internal Controls" and of "Diocesan Financial Issues," currently being reviewed by the USCCB's canon law committee.

In one of his first tasks after coming to the archdiocese, McNamara worked with Msgr. Dillon to establish more controls on parish borrowing and construction processes, requiring prior archdiocesan approval on all contracts and purchase orders. The controls are designed to ensure sound business practices and that parishes are positioned well to pay back loans. The new policy established that a parish, in order to get a loan, had to have a third of the cost in equity and "had to prove it could amortize the balance over a 10-year period," he explained.

In working for the church the decision-making process, McNamara continued, has involved the tough task of constantly balancing between pastoral and financial considerations. Working with parishes has involved the challenge of getting "pastoral-type people, non-financial people to understand the necessity of proper controls and the reasons why things need to be done the way they are. People will go off and say, 'We need to build this' without thinking how much it's going to cost."

An ongoing challenge for the entire archdiocese is "to see that we are maximizing our revenue potentials," he said, noting that some priests don't like to encourage members to donate money, which is necessary in order to carry on the church's mission.

His biggest, most "bittersweet" challenge was managing finances for the opening of three Catholic elementary schools in 1999, which "took 10 years off my life." There was controversy surrounding their budgeting, as the three elementary schools had greater deficits the first year than anticipated, he said, a problem he attributes to teacher salaries being higher than anticipated.

McNamara also explained that, as two of the elementary schools were built for 500 students each and the other for 250 students, the smaller one has a higher per-pupil cost, and his office originally set their budgets looking at the three as one organization. He stands by his decisions on planning the schools' finances and allocating funds among the three of them.

"I think what we did was proper," he said. "We got the schools built, accomplished that. That was a big job, a bitter job because of the way people reacted to our financial plan."

Assistant finance director Barbara Henderson, who has worked with McNamara for nine years, admires how the CFO strengthened the archdiocese's financial foundation.

"I think that one thing Mike accomplished with the help of Msgr. Dillon is to get the archdiocese on strong, firm footing. He's able to see the big picture of what we are and where we're going. A lot of people get mired in the details. He's able to look at the big picture. He finds innovative solutions to complex problems and makes them look simple," Henderson said. "One of the big things they did was to (strengthen) the diocesan deposit and loan program. That way everybody can usually afford to borrow money at a reasonable rate because we borrow money from one another . . . We pool all of our assets of the diocese and it gives us greater borrowing power. It's really helped the diocese to be able to grow and it gives us financial stability."

He's also helped her to grow. "He's been a great mentor and friend. He's a great guy. You couldn't ask for anybody better. I've learned so much from him. One of the biggest things I've learned from him is how to deal with each person as an individual and not stereotype him into a particular position."

The retiring CFO's next financial transaction will be selling his house and heading with his wife, Alice, to Edneyville, N.C., where one of his three children and three of his four grandchildren live, and building a log home on a 2.5 acre apple farm. "I was born on the streets of the Bronx and will die on the side of a mountain in North Carolina and what I do each day I will determine each day."

In retirement he looks forward to trying to jog again, which he took up in his 40s, but then stopped after having quadruple bypass surgery in 1997. And as a North Carolinian he hopes to continue his "biggest passion" of attending football games at Georgia Southern, where his children went to school. "It's a brand of football you can still call amateur football. To me it's what college football is all about."

And he'll only be three hours away from Atlanta. As the schools and churches of North Georgia continue to grow and develop, he leaves with a sense of satisfaction of having helped establish "a good accounting and finance department and (knowledge) that the archdiocese is in good financial shape."