University Times

Recently, an associate dean of the Faculty of Arts and Sciences was heard to say that more professors died last year than retired. The faculty has long been awaiting a new retirement plan engendering faculty renewal. Despite a recommendation from the Faculty Assembly, it appears now that the process is likely to drag on even longer.

Without adoption of an acceptable retirement inducement plan, the University is, in effect, sacrificing a multimillion dollar windfall. An overall reduction in incomes of aging faculty members would generate a decade or more of future savings. By enabling higher paid senior faculty members to retire and by recruiting lower paid young professors to start up the academic ladder in the tenure stream, the University will be better able to meet both its evolving academic and financial demands as the 21st century begins.

Initiated by a memorandum to the provost from the University Senate's benefits and welfare committee back in July 1994, Pitt, through its Faculty Assembly, has continuously backed the need for rejuvenation and intellectual diversity while preserving the indispensable attributes of academia. It must be recognized, however, that adopting a retirement inducement plan will rob the University of its most seasoned faculty.

The University's national reputation has been revealed by the productivity of its scholars. Despite the potential loss of so many renowned professors, Pitt's Faculty Assembly fully grasped both the academic and financial implications of recent legislation eliminating mandatory retirement.

Discontinuance of mandatory retirement has perhaps already contributed to more than 25 percent, or 344, of today's tenured faculty members remaining at Pitt after reaching retirement age.

A distinguished committee composed of a dedicated group of Pitt faculty members and administrators was appointed to consider a retirement inducement plan. The group included the then president of the University Senate, two past presidents, two highly respected faculty members, an emeritus professor who was unaffected financially by the outcome of the committee's deliberations, and two representatives from the administration: one an associate provost, the other the chancellor's chief financial officer. The committee spent long months in meetings, consulted with legal advisers, reviewed other universities' patterns of inducing retirement, and most importantly analyzed the outcome of previous plans at Pitt over the past 15 years.

Eventually, the committee proposed two options. A window plan would allow for a gradual reduction in the number of retiring faculty over three years wherein an eligible faculty member would have to make a decision to leave employment during the first year and accept a two-year payout of 2.5 times salary that year, tapering to 2.1 times in the second year, and to 1.7 times in the third year. The incentive would decrease as one delayed departure.

The second option would allow for phased-down employment over the next two to five years wherein an eligible faculty member could elect to halve his/her workload while receiving two-thirds of previous salary and one year's salary as a bonus upon retirement. Eligibility for both plans would be determined by age, years of service, and tenure status, with a cap of $100,000 on the contract salary including pension benefits.

Under the window option, faculty retirement income would be less in real dollars than the amount paid by Pitt's 1982 early retirement plan when adjusted for inflation. The 1982 plan prompted some 50 percent of the then eligible faculty members to retire early. A subsequent, less generous early retirement plan prompted only 27 percent of eligible faculty to choose retirement over continued employment. The need for a substantial initial payout under the window plan could readily be met by borrowing the necessary funds and later repaid or by reallocating resources within the University budget. Notwithstanding the committee's well thought out proposal, one of the two administrators abstained from voting; the other voted against the proposal sent to the chancellor. The six faculty members on the committee unanimously agreed upon an approach to rejuvenate the academic environment at Pitt, keeping its financial circumstance in mind. After due deliberation the Faculty Assembly endorsed the committee's proposal. The proposal was forwarded to the chancellor in June, and was intended to take effect on Sept. 1, 1997. The chancellor, however, has indicated that he wants to run the proposal by the trustees' budget committee Sept. 30 and then by the full board, which does not meet until Oct. 23. Thus, the plan cannot go into effect on Sept. 1, and maybe not by Jan. 1, if at all.

By accentuating the financial benefits to Pitt from the plan, the Faculty Assembly's recommendation is in league with the future as Pitt engages in a capital fund drive seeking contributions from major donors, alumni, alumnae and others.

Gordon MacLeod is president of the University Senate.