Q: Where does the money come from to pay for the large sex abuse settlements in recent years?
A: Sadly, the Church—whether dioceses or religious organizations—have faced huge financial settlements due to various abuse cases. Each situation is unique: Most dioceses and religious organizations have liability insurance which covers at least part of the settlement. Most have also had to sell Church property or other assets to raise revenue. Some have declared bankruptcy.
However, Sunday offerings remain within the parish. A parish is a separate entity, and the Bishop may not take parish revenues or other assets; they are to be used for the parish.
One thing to keep in mind: One reason why the Catholic Church is the target of such lawsuits is because lawyers know they are dealing with more than one little parish, like a Baptist Church. The lawyers see the Church as a “cash cow.” Protestant ministers, rabbis, etc. all have the same incidence of abuse as the Catholic Church—this does not excuse anything—but the Catholic Church has a diocesan structure and organization that the others do not have.