Deans: Retirement buyout not financially sound

A proposed buyout plan encouraging older UNM faculty to retire was recently ended because of questions about its financial viability.
Faculty Senate President Richard Wood headed a task force on retirement incentives that proposed in February for UNM to offer potential retirees an annuity equal to one year’s salary so as to allow UNM to hire promising young professors.

“We really had two goals with it,” Wood said. “One was to make it possible for senior faculty members who were ready to retire to retire earlier than planned, and the other was to open up spots so that we could really compete for some of the best young faculty available.”
Sociology professor Richard Coughlin drafted the proposal in October 2009.

According to the proposal, the most important factor influencing savings to the University is the proportion of eligible faculty who retire as a result of the incentive.

“Each tenured faculty member who moves up retirement by one year saves the University, on average, approximately $100,000 in the first year and $200,000 to $300,000 over three years,” Coughlin said.

Richard Holder, deputy provost for Academic Affairs, said deans thought Coughlin’s plan would cost the University more money than it saved in the short term.

“The deans just really didn’t feel like was an economically sound and viable proposition for the University,” Holder said.
Coughlin said nationwide reports show tenured faculty members are choosing to work beyond the average retirement age, resulting in “graying” faculty. He said UNM is no exception.

“As many as 300 assistant professor positions could be opened over three years by an effective retirement incentive program,” he said.
Increased retirements will allow renewal of the faculty through the recruitment of high-quality junior faculty and would facilitate the University’s goal of diversifying tenure track faculty in terms of gender, race and ethnicity.

Wood said the college deans said the plan was too risky because money could be lost if not enough faculty members opted to retire. Holder said the University has systems in place where the University can buy out tenure faculty members who agree to retire. He said faculty members must be eligible for retirement to qualify, and each college sets its price for the tenure buyout.

“A faculty member’s tenure is pretty much a lifetime guarantee to work at UNM and have free speech at the University, barring any felonies or misconduct, of course,” he said. “Basically, we give them a check, and they give us their tenure,” he said.
Provost Suzanne Ortega said the University is not considering any other buy-out plans.