Minnesota State Mankato is offering an early retirement incentive to faculty members in hopes that it will alleviate impending budget woes and keep them from trying more drastic measures.
The program, called the Board Early Separation Incentive, is being offered as one way the university can deal with what could be a disastrous budget year come 2012.
While it’s still early and the numbers could change, budget projections predict a state deficit of $4 to $7 billion. MSU’s percentage of that would be roughly $5.8 to $10.3 million.
On top of that, MSU President Richard Davenport announced last week that the university is considering a concept known as “retrenchment” that, if ultimately enacted, could lead to faculty layoffs or full-scale elimination of programs.
The retirements are among the first efforts to save money, and so far only three faculty members have applied for the program. About 20, however, have expressed interest in putting together some kind of retirement plan, although it may not be on MSU’s ideal timetable.
If all 20 retire early, the university could save about $2 million. But some have asked about pushing their retirements back a year.
Rick Straka, MSU’s vice president for Finance and Administration, said the university had hoped more employees would opt to retire in May. Don Larsson, MSU’s Inter-Faculty Organization representative, said his understanding was that the university was hoping for 60 retirements.
But Straka said that, even if faculty members wait a year — which would bump them up to the next budget cycle where cuts would have to be made when money is already tight — the university still will save money. It just won’t be as much or as soon. The alternative is having to pay them, which is contrary to the program’s intent.
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