Retirement incentives for eligible
By Matt Kelly
U.Va. Board of Visitorsexecutive
committee and state officials have approved a faculty retirement
incentive program in an effort to help the University meet budget-cutting
by Peg Campbell
plan, approved by the board on Dec. 9, was OKd by the state
secretary of education, with minor revisions to clarify language,
and reviewed by the state attorney general, according to Vice
President for Finance Yoke San Reynolds.
incentive plan offers two options to eligible faculty members
who apply this spring. One offers half pay and full benefits for
a 50 percent reduction in work for up to two years, then full
retirement. The second option is a straight buy-out, with the
retiree receiving a full years salary, paid out over 12
months, and whatever the University would have spent on his or
her health insurance. The dean would determine how the retirees
workload would be handled within the constraints of the schools
budget, said Reynolds.
plan is open to roughly 300 full-time faculty members who are
at least 55 years of age with 15 years continuous service to U.Va.
However, an application may be rejected if the retirement would
have an impact on the Universitys core mission. The plan
is not available for classified staff, and any incentive program
for them would originate with the state, Reynolds said.
Dates of Plan
28: Deadline for applicants to file with their dean or department
1: Deadline for applicant to return the separation agreement
that has been recommended by a dean or department head and
approved by the provost or executive vice president.
2003: Retirements could be effective as early as this date.
we would like the budgeted savings, we are also very conscious
that there are not many areas that can redistribute the workload
of the eliminated position without significant impact on the Universitys
mission, she said.
incentive program is part of U.Va.s response to $93.5 million
in state cuts for the 2002 to 2004 budget years. The board recently
increased tuition for the spring semester by $385, and deans and
department heads have been given budget reduction targets for
their areas. It may initially cost U.Va. up to $2 million per
year paid out of funds already appropriated for the retirees
salaries. Savings, which should equal the cost of the incentives,
would start to accrue in the second year of the program.
Gausvik, chief human resource
officer for the University, is preparing a one-page summary of
the incentive plan to distribute to faculty and staff.
J. Smith, chairman of the Faculty
Senate, said he had not seen the plan but the senates
executive committee would discuss it.
will certainly occasion great interest among the faculty,
he said. I presume the Faculty Senate will have an opportunity
to consider the proposal and offer its reactions.
said the plan was not to drive out faculty but provide something
for which people could apply and for which only a small number
will be accepted. Each department has been given budget-cutting
targets, some of which will be attained through reducing positions
or cuts in other areas.
incentives must be paid from money already budgeted for the retirees
position. Any resulting savings would be returned to the provost
or executive vice president, or credited toward budget reductions.
Reynolds said deans may be depending on personnel reductions for
savings. With the hiring freeze in place, she said, many departments
have vacant positions they could count toward budget cuts.
also noted that the General Assembly could make its own reductions
in the state budget. Then it would be a whole new ball game,
introduced a retirement incentive program in the early 1990s as
part of its reaction to state budget troubles, Reynolds said.
That plan offered only the half-time phase out and did not have
a buy-out option. There is currently no retirement incentive plan
in place at U.Va. Virginia Tech has an incentive plan, which Reynolds
said differs from U.Va.s plan because most of Techs
faculty is on the state retirement system, while U.Va. has its
own faculty retirement program.
This is not going to generate a lot of savings, but it can
be a useful tool for the deans and department heads, Reynolds
said of the plan.
the plan, applicants must file with their dean or department head
by Feb. 28. If recommended by a dean or department head and approved
by the provost or executive vice president, a separation agreement
would be sent to the applicant, to be returned by April 1. Retirements
could be effective as early as May 2003.