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April 2, 1998

40+% of eligible faculty opt for Pitt early retirement plan

More than 40 percent of 381 eligible tenured faculty members have signed up for Pitt's early retirement incentive plan, the administration announced yesterday.

In approving the plan last October, Pitt trustees said it would give the University more flexibility in meeting changing academic needs.

In a written statement, Chancellor Mark Nordenberg said the level of participation — 163 of 381 eligible faculty members — was significantly higher than the 30 percent threshold "initially identified as adequate to advance the twin goals of generating savings and stimulating a level of turnover within the faculty ranks that will help ensure the flow of new ideas essential to Pitt's mission as a research university."

Nordenberg said the plan will help the University meet its academic goals. "We have been studying all of our educational programs for the last three years, making hard decisions about future directions, so that we can do the best job of preparing our students to lead meaningful and productive lives in the next century.

"We have identified the types of programs and faculty needed to drive this change, and this plan gives us the flexibility to put them in place, enabling us to continue the innovation that is essential to a university at the 'cutting edge' of knowledge in both its teaching and research missions," he said.

Nordenberg added that, because the plan was intended to encourage higher paid faculty members to retire, it is expected to produce significant savings for the University. Depending on future replacement hiring, the plan should save Pitt $10 million to $14 million at today's cash value over the next seven years, he said.

Tenured faculty were eligible for the plan if they had completed at least 12 years of service and would be at least 60 years old prior to July 1, 1998, or if the sum of their years of age and years of service would total at least 85 by that date.

March 31 was the deadline for signing up for the plan, which was voluntary.

Participants have agreed to relinquish their tenure rights and retire between July 1, 1998, and May 1, 1999. In return, they will receive payment equal to 1.5 times their annual contract salary, but not exceeding $125,000.

Nordenberg said the plan was developed to deal with the "backlog of retirements" that had resulted from expectations created by the pattern of early retirement plans sponsored by the University since 1982.

"This pattern created the sense that, simply by delaying their retirements, tenured faculty members would qualify for payments in addition to the normal retirement benefits," he said.

In approving the plan, the Board of Trustees also passed a resolution stating that it would not support another special retirement plan in the future.

Nordenberg wrote: "What made sense in the 1980s is not a strategy that will take us into the next century. Our general retirement plan is designed to provide a secure and comfortable retirement for our faculty.

"With the foundation for individual expectations clearly articulated, we can move forward with the work of assisting faculty members of all ages to plan effectively for retirement within the framework of our general retirement plan."

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