Proposed changes to retirement plans have UNM faculty scrambling in the face of diminishing benefits, higher costs and a longer time before retirement.
The New Mexico Educational Retirement Board released a draft proposal of changes to retirement policies that would affect the University and public school faculty and staff on the plan.
Merle Kennedy, president of the UNM Staff Council, said the proposed changes are troubling UNM employees.
“Changing the rules when you’ve got a large part of your life invested — it just isn’t fair,” Kennedy said. “It not only doesn’t seem fair, it isn’t fair. People have made their plans for retirement, and now 10, 15, 20 years into the program, when they’re going to retire in five years … they are told it may be up to 10 years longer than expected. That is getting into everybody’s life planning very deeply. It’s very personal for everyone.”
Jan Goodwin, NMERB executive director, said the changes are necessary and would ensure the fund’s long-term sustainability. He said NMERB members with 22 years of service would keep their current retirement plans.
“Currently, the present value of the benefits that have been earned are greater than the assets the fund has,” Goodwin said.
Right now, members of any age, except those hired since July, may retire after 25 years of service. Under the proposal, that would change to 35 years. The current plan follows the “Rule of 75,” where the member could retire if his/her age and years of service added up to 75.
Also under the proposal, members would have to be 60 years old with 30 years of service, and those who have reached age 67 with at least five years of service would also be eligible to retire.
Members’ contributions would also increase by .5 percent of their salary, so employees who make less than $20,000 a year would start contributing 8.4 percent of their salary, and those who make more than that would give 9.9 percent to the ERB pool.
The proposal can be modified before a final board vote Dec. 10. The proposal would then go to the NM Legislature for consideration.
“What we’re trying to do now is to expand the (number of) people who will not have any changes,” Goodwin said.
Kennedy said his stay at UNM would be prolonged due to the proposed changes.
“I’m eligible to retire now, and under these I would not be eligible for five more years,” Kennedy said. “I have made my plans for retirement. ... It’s unbelievable for me.”
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Joel Nossoff, with University College, said he was in disbelief when he first heard about the proposed changes. Nossoff, 63, said he is eligible to
retire now under the “Rule of 75.” Under the proposed changes, he would not be eligible to retire until 67.
“I first heard about it from three different people, and when they told me their interpretation of it, I had to think, ‘Oh, they must have read it wrong,’” Nossoff said. “Suddenly, that’s all out the window. That’s very frustrating.”
Kennedy said he would work with the Staff Council to change the recommendations.
“We definitely would like to influence what they recommend, and then if we don’t get what we want, we will be going to the legislature ourselves,” Kennedy said.
