Read the original story in The Oregoinian here.
Portland State University is offering eligible staff and faculty a retirement incentive as it braces for an $8.5 million drop in revenue and $10 million increase in costs next year.
"Given the likelihood that some position eliminations may be necessary this year, retirement incentive offers are considered a best practice in such circumstances," wrote Monica Rimai, vice president of finance and administration, in an email to staff Friday.
The university is offering a $10,000-to-$40,000 cash incentive to faculty and staff who are at least 55 as of June 30 or have at least 30 years of retirement credit with an Oregon Public Employee Retirement Systememployer.
Some also can choose a second incentive instead: health insurance subsidies up to $990 a month. Those taking the insurance option can do so only for themselves and cannot be eligible for insurance from a spouse's plan.
The retirement incentive was revealed this weekend after a month of negotiations between PSU administrators and members of the PSU chapter of the American Association of University Professors.
The union has long wanted a retirement incentive, which are common in higher education, said Ron Narode, an education professor and vice president for collective bargaining for the union.
"If you want to move some people around and let some new blood in, this is a way to make it happen," he said.
But Narode, who pushed for cash payments of at least $20,000 to $60,000, questioned whether PSU's retirement incentives are strong enough to make much happen.
"Does this sweeten the pot enough?" asked Narode, who at age 58 is among the eligible. "I would never choose to take this."
He said the university, which employs more than 4,000 faculty and staff, also may have some reluctance to lose too many of its seasoned faculty as it will have to spend nearly as much in salaries to lure worthy young replacements.
"Why lose an experienced and accomplished person to bring in a brand new graduate?" he asked.
The university next year expects to operate $18.5 million in the red, in part because of a $9 million increase in salary and benefits.
"PSU is currently operating with a structural budget deficit and will continue to do so for the foreseeable future," wrote Rimai.
The school, the state's largest with nearly 30,000 students, is relying on a $53 million reserve to carry it through 2014-15, by which time it aims to balance its operating budget. To reach that balance, it plans to reduce spending, increase efficiencies and keep tuition increases as low as possible. The plan calls for reducing spending by 4 percent in the next school year.
"We have to reduce the budget every year for the next three years," Rimai said.