The wrong plan to retire by

When things get desperate, then desperate solutions become more attractive. But a plan encouraging droves of university employees to retire early would be a long-term disaster.

The Faculty Senate voted to support possible legislation which would encourage university employees aged 50 years and older to retire with the benefits of someone five years older. This already exists for those who have worked at a university for 35 or more years but the new plan would shorten the time of employment to only five years.

This would run as a one-time-only offer, where qualifying employees would have six months after the law goes into effect to decide if they want to participate. Many are expected to retire early; in fact, that is the point of the idea.

Additionally, the universities would be obligated to “buy” the years for any of its eligible employees, although the percentage of the employees’ salaries the buy would cost is still being debated.

Proponents of the idea say it would be an obvious boon to the retirees. They also say the state would make money not only from the initial university payments but from the payroll savings that would come from removing so many highly-paid senior workers from the rolls.

But another reason the Faculty Senate would support the idea is to avoid the problems the State University Retirement System is having getting funds from the state. SURS has been underfunded in almost every budget since its inception about a decade ago. There are real concerns that the money will not be there in five or 10 years.

University workers nearing retirement fear the state will renege on its lawful promises to pay them. They rightfully see this retirement plan as the only sure way out of jeopardizing their futures.

So it is no surprise the Faculty Senate approved the plan, as many members will directly benefit from it.

But, however understandable their reasons are, the plan will be a bad one for the state in general and younger university employees in particular.

The state might get a bonus from the influx of dollars from the state universities for one year. But the number of retirees the plan spawns would burden the system for much longer than that.

The SURS fund, which is in desperate straits now, might well be drained by this plan. That means the guaranteed retirement payments would have to be made up either from a tax levy or from budget cuts. Either option, of course, would be extremely unpopular.

But since the fund drain could be put off a year by the university payouts, the state government just might be enticed into it—especially if it means quieting angry university employees and foiling a “throw the bums out” movement in an election year where every seat is up for grabs.

The General Assembly is the last one to be pitied in this situation. It is their refusal to fulfill its obligation to SURS that is the cause of the retirement fund worries in the first place.

But this plan is a Faustian bargain that will only create more problems for them in the future. Better they should bite the bullet and fund SURS properly for a change.