College offers cash incentives to ease the pain of staff reduction
Facing a slash of $800,000 in next year's budget caused by slumping enrollments, USU Eastern is taking steps to ease the pain of inevitable reductions in personnel and programs.
The college is offering eligible employees an option to resign voluntarily and is offering a cash incentive to make separation worth considering.
In a mass-email to the Price and Blanding campuses, Chancellor Joe Peterson stated that employees aged 56 to 59 and 60 to 65 who are eligible for early retirement will receive a one-time cash incentive of 25 percent of annual salary in addition to the full early retirement benefits. The payout could be in cash - making it taxable - or it could be put in into a tax-advantaged retiree health savings plan. There are some technical differences in the treatments of the two age groups.
The other option in the Voluntary Separation Incentive Program is for any benefit-eligible college employee to quit and be paid a one-time cash payout of one week's salary for each full year of service. There's a minimum of $5,000 and a maximum of $22,000 or 20 weeks' salary, whichever is less.
USU Eastern's Cabinet has to approve all VSIP participants.
Also, this is is a one-time deal with a short deadline. Those who wish to apply must do so before March 1.
"After the VSIP deadline, the College will identify other positions and programs for elimination in order to make the required budget reductions," the chancellor's letter stated.
The college has lost tuition revenue as result of its enrollment decline. The 2011-12 school year enrollment was only 89 percent of the previous year. This year's enrollment was 85 percent of 2011-12. That's equivalent to 400 full-time students, with a drop in tuition revenue of about $3,000 per full-time equivalent.
The $800,000 reduction will mean $500,000 less to spend in Price and a $300,000 hit at Blanding.
The projected cuts come as no surprise. The drop in enrollments was apparent last fall, when the first figures came out. In an interview last October, Chancellor Joe Peterson and Vice Chancellor Brad King said the college and the university are aware they're facing a big challenge to reverse the trend.
This is especially true since the Church of Jesus Christ of Latter-day Saints has lowered the age for male missionaries to 18 from 19 years old. Young Mormon men will not attend a year of community college before departing for their missions.
Nevertheless, the college is embarking on what the chancellor had called a "big, audacious goal" of boosting enrollments to 4,000 students in four years.
Peterson will introduce details of the "Four in Four" campaign at the Chamber of Commerce luncheon next Thursday.