Board of Curators approves retirement plan
The new retirement plan splits employee benefits into defined benefit and defined contribution segments.
Oct. 21, 2011
The UM System Board of Curators approved a new retirement plan and an athletic training degree during day one of a meeting at UM-Kansas City on Thursday.
Other topics discussed at the meeting include a renovation to Gwynn Hall, similar to the previous Tate and Switzler Hall projects, and an architect and engineer approval for a Chemical and Biological Engineering Building at Missouri University of Science & Technology.
The curators will meet again Friday.
The retirement plan will apply to employees hired after Sept. 30, 2012. By 2031, about 80 percent of MU employees will be on the new plan.
“After more than two years of study, we are changing the retirement plan for new employees,” UM System Interim President Steve Owens said in a news release. “The new plan will allow us to better moderate risk and volatility for the university, ensure the current plan’s long-term viability for existing employees and retirees and offer new employees a fair and equitable retirement plan that is growing in popularity among public higher education institutions.”
The retirement plan, researched and analyzed by the Retirement Plan Advisory Committee and the Retirement and Staff Benefits Committee, is a combination of a defined benefit and defined contribution plan.
According to the news release, the defined benefit aspect of the plan calculates benefits the same way the current plan does, but it contributes a 1 percent pay multiplier, compared to the current plan’s 2.2 percent multiplier. This is compensated for in the new plan’s defined contribution segment, which includes a 2 percent contribution of university employees' salaries to an employee-directed account.
According to the release, new employees can make tax-deferred voluntary contributions and the university will match that amount up to 3 percent of the employee’s pay. A university investment committee will monitor the contributions.
In the meeting, curator Don Downing said he appreciated the Retirement Plan Advisory Committee’s job on the plan even though he voted against it.
“It’s been a long process,” he said. “But it’s been a very transparent and, I think, very fair process to all concerned."
The idea to develop a new retirement plan was first conceptualized in June when the board decided to end the current retirement plan in 2012.
According to the MU Office of Admissions, athletic training and sports medicine are the most desired degrees requested by students that are not currently offered.
MU Vice President of Academics Steve Graham said the athletic training degree would be embedded in the physical training program through the School of Health Professions.
“That should increase the ability to coordinate and bring a really good program,” he said. “It’s really a well-done program. It’s fully vetted. The campus is very strong behind it.”
Graham said the program requires about 60 enrolled students to be academically and fiscally sound. He said current estimates indicate 120 students will participate.
“It’s pretty well done and very well thought out,” he said. “We’re very supportive of it. It’s headed in the right direction.”