Facts About Agnes Scott budget re visited

READ THIS AND TELL ME HOW YOU FEEL.

Scotties, 

In light of the recent budget “crisis”, as SGA President I would like to share some information with you about what is going on and the time frame that surrounds the decisions administrators must make concerning budget cuts. As some of you may know, I am the student voice on Executive Council, a committee headed by President Kiss and attended by the Vice Presidents, key department directors, the Chair of the Faculty, and the Chair of Staff Council. During our meeting before spring break there was an extensive and sensitive discussion about the future of our campus community. I would like to share some details with you so you can stay informed, and promise to keep you updated as new facts surface.

1)    Agnes Scott is currently drawing from our endowment at a rate of 6% per year. (Our target is to stay under a 5% draw.) While this seems like a small number, this is a multi-million dollar dip that is a result of attempts to dodge the recession and keep the College functioning normally. Over 40% of the endowment is dedicated to funding incomes. A 6% draw compiled over a number of years is dangerous to maintaining a strong endowment. The purposes of the cuts are to “sustain our momentum on enrollment and fundraising and protect the quality of our undergraduate experience and our liberal arts mission.” (This quote was taken from an e-mail sent by President Kiss.)

 

2)    Each Vice President of the College (Academic Affairs, Student Affairs, College Advancement, Finance, and Enrollment) has a “budget reduction goal” they must meet. This means that the VPs will need to cut operational and employment costs based on what they feel is essential to retaining the undergraduate experience. <What is this being based on and where is OUR say?>

3)    One option that the administration has set in motion is asking staff members to voluntarily move themselves from being 12-month employees to 10-month employees. This will result in a reduction of their annual pay or salary. Per Georgia Law, the Agnes Scott administration is allowed 45 days to consider these alternative options, so these options have only recently become concrete. The staff members whose positions are eligible for this package can elect themselves for these options starting May 9. The decision to take these alternate options will not secure a staff member’s position at the College. In addition, a retirement package has also been determined for faculty and staff. According to the qualification guidelines, there are only 30 members (14 faculty and 16 staff) who are eligible for these packages.<Tisk Tisk> The staff or faculty member must be at least 62 years of age, and have a minimum of 10 years of service to the College to accept the package. The combined number of age and years of service must total 75. For example, an employee who is 62 must have worked at Agnes Scott for 13 years (=75) to qualify for a retirement package. Members who agree to the retirement plan will receive 150% of their current salary and health insurance (at their current rate) over a period of 18 months after the date of termination. Retirees will be eligible for a retiree healthcare plan after these 18 months.

4)    All layoffs will be announced on May 16. On May 10 and 11, VPs will present drafts of their plans to meet the $3 million cut. There will be subsequent revisions to the plans until they are ready to be finalized. At this point, administrators are researching the best options to implement this process and what the time frame will be for employees to continue working after termination.

5)    There have been 3 brown bag lunches open to the campus to voice concerns about this process. These sessions have been more informative over time as new information is compiled.

6)    It has come to my attention that many students are alarmed by President Kiss’s movement to respectfully decline a suggestion to take a symbolic pay cut. She went on to explain that one of the problems with the culture of Agnes Scott is that its employees are not fairly compensated. In order to keep us functioning as a competitive liberal arts institution, we must keep all of our staff, faculty, and administrators’ salaries competitive as well. President Kiss does not believe that taking a salary reduction will solve any of the College’s long-term financial problems. <DOES ANYONE ELSE HAVE A PROBLEM WITH THIS?> 

I pledge to keep you informed as more information surfaces. Next week, SGAExec plans to host their weekly meeting as an open forum for questions and discussion. This will be held in the ground floor of the Bullock Science Center in the Teasley Auditorium at 8:30 P.M. on Wednesday March 30th. Please do not hesitate to e-mail me (lkenney@agnesscott.edu) if you would like to meet with me personally or discuss questions you may have. Students have my support and the support of the SGA Executive Board. I encourage you to stay informed, respectful, and involved throughout the process.

Best,

Lauren Kenney

Terms of Early Retirement

From: Kiss, Elizabeth
Sent: Wednesday, March 23, 2011 8:14 AM
To: #Fulltime-Faculty; #Fulltime-Staff; #Part-Time Faculty
Subject: Voluntary Budget Reduction Programs for Faculty and Staff

***********PLEASE POST FOR COLLEAGUES WHO DO NOT HAVE REGULAR ACCESS TO EMAIL************

Dear Faculty and Staff Colleagues,

As part of our strategy to reduce college expenses and achieve long-term financial goals, Agnes Scott is offering several voluntary options to eligible employees.  Please note that participation in these programs is completely voluntary.  It is our hope that some faculty and staff will find these options attractive, resulting in benefits both for them and for the college.

Yesterday, the Executive Committee of the Board of Trustees approved two “window plans” for eligible employees who meet age and service requirements:  a window retirement plan for faculty and staff, and a phased retirement plan for faculty.  A description of these programs is below.  In accordance with Federal law, the college is providing a 45 day sign-up period to eligible faculty and staff. All those who are eligible for these plans will be personally notified via email and mail.

In addition, the college is offering a reduced hours option to staff and is exploring the possibility of a half-time option for faculty.  You will find more information about each of these options below.

If you have questions about any of these options, please contact Director of Human Resources Karen Gilbert at 404-471-6435 or kgilbert@agnesscott.edu.

Sincerely yours,

Elizabeth

*****************************
Elizabeth Kiss
President

Agnes Scott College Voluntary Budget Reduction Programs
March 2011

[1] Window Retirement Plan for Faculty and Staff

Sign-Up Deadline:  Monday, May 9 at 4:30 pm
Retirement Date:  July 1, 2011

Benefits:
·         18 months salary continuation equivalent to 150% of current salary

·         2:1 TIAA-CREF match from college during the 18 months

·         Eligible for health insurance at current full-time rate during the 18 month salary continuation period, then eligible for retiree healthcare plan

A window is a voluntary retirement program offered to a group of employees who meet age and service requirements.  Individuals who choose to participate agree to retire on a specific date in exchange for a set of financial benefits. Faculty who take advantage of this program also agree to relinquish tenure rights.

Faculty window eligibility:  All tenured faculty whose age + years of service = 75 by 12/31/2011 with a minimum age of 62 and a minimum of 10 years of service
·        Faculty participants may request, if available and depending upon discussions with the department chair and dean, to teach up to three courses a year for $5,000 per course, for up to two years following retirement.
·        Faculty may also request other accommodations to assist them in continuing their scholarship, such as access to office or lab space.

Staff window eligibility:  All full-time staff whose age + years of service = 75 by 12/31/2011 with a minimum age of 62 and a minimum of 10 years of service
·        Staff participants will also receive a payout of their accrued vacation up to 140 hours per college policy

[2] Window Phased Retirement Program for Faculty

Sign-Up Deadline:  Monday, May 9 at 4:30 pm
Retirement Date:  July 1, 2012, 2013, or 2014

Benefits:
·         2:1 TIAA-CREF match for salary during phased period

·         Eligible for health insurance at current full-time rate during the phased retirement period, then eligible for retiree healthcare plan

A faculty member agrees to reduce her/his teaching and work load and salary by 50% for a period of time, not to exceed three years.  At the end of the specified time period, the faculty member relinquishes her/his tenure rights and retires.  During the phased period, the faculty member may either teach three courses and be relieved of advising, committee service and department chair rotation duty or, with the approval of the dean, teach two courses and take on specific departmental or college duties.

Phased retirement program eligibility:  All tenured faculty members who are employed at half time or greater are eligible to participate in this phased retirement program provided that:
§         they will be at least 62 years of age by the end of the term of the phased retirement agreement (i.e., by July 1, 2012, 2013 or 2014); and
§         their age and years of half time or greater service at Agnes Scott total at least 75 by the end of the phased retirement program.

[3] Reduced Hours Option for Staff

A staff member, with supervisor approval, may agree to voluntarily reduce her/his hours resulting in a pro-rated reduction in salary and benefits on a permanent basis.  This program is designed for individuals who would prefer to work fewer hours and whose job responsibilities are consistent with a reduced schedule. Primarily, this would mean reducing her/his position from one which works 12 months per year to one which works 10 or possibly 11 months per year.  Other voluntary reductions may be considered on a case-by-case basis.

[4] Half-Time Option for Faculty

The college is also exploring the possibility of offering tenured and tenure-track faculty at any rank, age or years of service the option of shifting from a full-time to a half-time tenured or tenure-track position on a permanent or multi-year basis, subject to departmental and dean approval.  This option has been introduced successfully at several other institutions.
If you are interested in exploring this option, please contact the dean.

College Budget Information

Over the last two weeks faculty and staff have been in multiple meetings about faculty and staff layoffs that are going to be announced on May 16, 2011 (two days after graduation).

Some students have been able to attend these meetings or find out information about what is happening through other means. However, quite a bit of this remains under wraps. What we know for sure right now is that (1) layoffs are happening soon, and faculty/staff have been asked to accept “voluntary early retirement” packages; (2) tuition is going to increase next year, probably by a wide margin; and (3) administrators have been clear in emails and statements in meetings that they are releasing (or not releasing) this information to students in slow, strategic ways.

At their February meeting, the Board of Trustees approved the document below. It outlines some of the things to come in pretty vague language. Point 2 is about increasing tuition, and point 3′s word about “right sizing” is code for layoffs.

Stay informed about your college budget process!! We’re all part of this.

Agnes Scott 2020:
Six Steps to a Sustainable Financial Model
Adopted by the Agnes Scott College Board of Trustees, February 10, 2011

1.    Increase enrollment from 837 to 1,100 by 2020
Purpose: Create a critical mass that allows us to offer the scope of education required for
an excellent liberal arts college
Implications: Focus on enrollment and retention; continued attractive financial aid;
commitment to faculty excellence and dynamic academic programs; residence hall
renovation

2.    Lower the discount rate from 62% to 58%
Purpose: Increase our net operating income per student, which would result in a financial
model more in line with other high-quality liberal arts women’s colleges
Implications: Increase net tuition; create an educational experience that our students are
willing to pay for; a curriculum that reflects student interests; continue to pursue a
balance between recruiting students who can pay a larger percentage of their education
costs without sacrificing the rich socioeconomic diversity of the student body

3.    Control and “right size” expenses
Purpose: Achieve a sustainable ratio of expenses to revenue
Implications: Reduce expenditures by $3 million over 2 years, while maintaining our
revenue drivers and protecting the core mission of the college

4.    Pursue critical capital projects through fundraising
Purpose: Acknowledge that the college does not have the funds to pursue capital
projects, and does not plan on incurring additional permanent financing to fund such
projects
Implications: The College will have to prioritize among capital expenditure projects and
place emphasis on residence halls; projects will not be commenced until funding
commitments are obtained.

5.    Reduce the burden of the debt structure
Purpose: Take steps to lower the constraints on the college due to our current level of
debt
Implications: Pursue debt refunding project and make accelerated debt payments over
time when possible; set financial guidelines for when this should occur 

6.    Reduce the draw on the endowment to approximately 5%
Purpose: Maintain the purchasing power of the endowment for future generations of
students
Implications: Assure the college’s long term financial stability by continuing our plans to
reduce the rate of the endowment draw and ultimately the dollar amount of the draw.

Additional debt principal payments could temporarily increase the percentage of our
draw, while leading to stronger health of our endowment.

Purpose

This site is managed and upheld by students, faculty, and staff who have committed to fostering an environment of openness, transparency, and collaboration in the ASC community. Currently our particular concerns focus on the ASC budgeting process, although we recognize how economic decisions at ASC affect and reflect many other areas of our community life. Come to this site to see and raise questions about developments in our community. If you would like to contribute, email asctransparency@gmail.com.