The Archdiocese of Philadelphia has announced plans to sell its nursing homes and to outsource the management of its cemeteries, citing a major deficit in its operating funds.

"Our difficult financial situation must be addressed and the actions that we need to take may be painful ones," Archbishop Charles Chaput said Aug. 20.

"I understand this fact fully, but it is of critical importance that we rebuild our financial foundation so that we can continue our collective good works."

The archdiocese said its audit of financial statements for the fiscal year ending in June 2012 discovered a $39.2 million operating deficit and "several very significant and ongoing balance sheet issues" that ran into the hundreds of millions of dollars.

To help address the shortfall, the archdiocese plans to put up for sale six nursing homes and one assisted living facility, all operated by Catholic Health Care Services.

The nursing homes had an operating deficit of $1.4 million in the fiscal year ending in 2012.

The archdiocese said it would sell the nursing homes on the condition that all current residents be retained regardless of their ability to pay.

"Every effort will be made to ensure continued employment for all those currently working within the system," the archdiocese said.

Catholic Health Care Services has a total capacity of 1,400 beds and is the seventh-largest faith-based nursing and assisted living provider in the country. It presently has about 1,100 full-time and 950 part-time employees.

The archdiocese is not planning to sell the cemeteries. Rather, it plans to outsource management and operations "in a manner consistent with Catholic values and the core mission of the cemeteries."

The plan concerns 11 active cemeteries and two inactive cemeteries designated for future use. Cemeteries operated by local parishes are unaffected.

The archdiocesan cemeteries have about 160 full-time employees and about 30 seasonal employees. The archdiocese said it will make "every effort" to ensure current employees keep their jobs.

The cemeteries conducted 6,900 internments in 2012.

Archbishop Chaput said the financial decisions he has come to were not made "lightly."

"They have all come after much careful discernment and prayer as well as significant discussion and consultation."

"In the end, any final decisions about our nursing homes and cemeteries will be mine. They'll be made with full and due consideration to the mission of our local Church and all those who would be affected."

The archdiocese has already sold the archbishop's residence and a vacation home for retired priests in Ventnor, N.J. It also cut staff at the Archdiocesan Pastoral Center by 25 percent.