Recently passed pension legislation has been recognized as a potential threat to the University and its ability to retain faculty. At the Urbana-Champaign Senate meeting Monday, Barbara Wilson, executive vice provost for Faculty and Academic Affairs, urged faculty to “sit tight” until administrators figure out a solution regarding faculty pensions because the legislation caps the amount of salary that receives pension.

“Even though we are such a large economic driver, the University receives late payments and has overbearing restrictions on the way it can operate,” said Senate Executive Committee chair Roy Campbell. “Now we are challenged to keep our pension plans competitive, but hopefully we can rise to that challenge.”

With state budget restrictions already hurting the University’s financial flexibility, Campbell said it will be a struggle to come up with the funds needed to supplement the decreased pensions of some University faculty.

“The University commitment to provide competitive health care without the support of the state is going to be a huge burden on our budget, especially when we are restricted by the state to not increase tuition and to provide scholarships for residents,” Campbell said. “There has to be a way of creating revenues to account for those extra costs. We do not want to jeopardize the University, for want of a budget, to do all of the things that it needs to do as a University.”

During the meeting, the Senate endorsed the University Senates Conference Statement on Pensions, which says that the University will not support any legislation that causes “irreparable harm” to the University’s ability to “recruit, retain and support” the highest quality faculty.

However, some senators did speak out against the endorsement. Senator Harry Hilton started the motion for the SEC to reconsider and revise the plan.

“From what we heard, there are parts that some people don’t agree with,” Hilton said. “Rather than voting it up and down, a resolution from SEC, I would think, could be approved.”

LAS Senator Thomas Anastasio said he thought a stronger statement could be made regarding pension protection.

“I don’t even know what (the USC statement) means,” Anastasio said. “This one truthfully doesn’t say anything. I think we should say something, and we have a stake in this and we want to protect the University, but this is just wishy-washy.”

John Kindt, chair of the Faculty and Academic Staff Benefits Committee, encouraged the Senate to endorse the statement anyway, despite the shortcomings recognized by Hilton and Anastasio.

“For time constraints and other reasons, we urge our colleagues to endorse this because it sends a message, and that is important,” Kindt said. “We are trying to think strategically about education as a whole. The University, after three years of negotiation, got absolutely zero of what we were looking for. I think people should understand that that is what the situation is.”

After Kindt spoke, the Senate voted to endorse the University Senates Conference Statement on pension protection.

Campbell said there is still some question over how the University will handle pension cuts, but proposed plans for supplementary pension funds are in the works.

“It is clearly not going to be very easy to do because that is a lot of money,” Campbell said. “It is basically taking on tenable pension system and effectively saying to the University, ‘Oh, you pay this piece, and we will pay the rest.’ I don’t know whether it is feasible to do everything that we ought to be able to do — all of the past pension plans and so on — but it is good to try.”

For the time being, the University has some protections in place to back up faculty pensions.

“The University has a little bit of a pool of money because they knew this might happen, it isn’t very much, but they have been very careful,” Campbell said. “How they do that in the future though is tough because all of these things are compound interests.”

Campbell also mentioned that these pension caps might be taken as a sign from the Illinois state government for the University to start seeking financial freedom.

“I feel the state is actually hinting that the University should seek independence from the state budget,” Campbell said.

MaryCate can be reached at [email protected].