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Strategic Budget Advisory Committee (SBAC)
Strategic Budget Advisory Committee

MU System Curators to Consider Pension Contributions, Furloughs

February 10, 2009

By MARÁ ROSE WILLIAMS

COLUMBIA | Employees at the four University of Missouri campuses could be forced to contribute to their pensions and take time off without pay to help the system survive difficult times.

The two issues were discussed during a Board of Curators committee meeting Thursday. The committee agreed that curators should give system president Gary Forsee the power to order employee furloughs in the event that state allocations to the university are reduced this year.

The proposals will be voted on today, when curators resume their meeting.

Under the committee’s agreement, Forsee would have furlough power until the end of the fiscal year, which is June 30, and he would have to consult with curators before calling for any furloughs.

“This should be a tool that is only event-driven,” Forsee said, adding that he could only see using this power in an emergency.

Betsy Rodriguez, the system’s vice president of human resources, said there are no plans for a furlough, but it is an option they want in place in case the university’s financial situation worsens. The system has 24,000 employees.

Faculty leaders on the four campuses — in Kansas City, Rolla, St. Louis and Columbia — on Monday had asked that if curators gave Forsee furlough power, a time limit also be imposed.

“If he had the power to furlough anyone at any time, that would not be accepted,” said Gary Ebersole, president of the Intercampus Faculty Council, which represents faculty on all four campuses.

But the way the agreement stands, with a time limit and curator oversight, Ebersole said faculty would “understand that this is only in a worst-case scenario.”

Faculty members were more concerned, Ebersole said, about paying toward their pension.

In a letter to Forsee earlier this week, MU faculty expressed their displeasure with the proposal, calling it a “backdoor salary cut.”

The committee agreed to ask the board to approve a plan that would require employees making $50,000 or less to pay 1 percent to their pension. Employees who make more would pay the 1 percent, plus 2 percent of any amount they earn above the first $50,000.

Forsee said having employees pay toward their pensions would be temporary and designed to help stabilize the university’s pension fund and “assure that five to 10 years from now there will be enough money to pay retiree and medical benefits.”

Because of a downturn in the market, the university’s pension fund dropped from the $3 billion it had reached this past summer to about $2 billion. The university expects that employee contributions would have a $12 million impact on the pension fund.

University officials have made several other cost-saving moves in recent months, including a hiring freeze and spending cutbacks in every department on all four campuses.

To reach Mará Rose Williams, call 816-234-4419 or send e-mail to mdwilliams@kcstar.com.
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