UM curators give initial OK to new retirement plan

The University of Missouri Board of Curators heard Thursday about a proposed retirement plan that officials say will offer new employees more flexibility.

Curators gave preliminary approval to the plan for future employees. If approved, those hired on or after Oct. 1, 2019 will have a defined contribution plan in which the university will match employee contributions dollar-to-dollar up to 8 percent. The new plan has a vesting period of three years.

University of Missouri System spokesman Christian Basi said the plan was updated because of market demand, adding employees want more flexibility with their investments and came to the university wanting this type of retirement plan.

“The new plans do not affect any current employees. They will see absolutely no change in their current retirement plans” Basi said.

The university started offering a hybrid plan in 2012 in which employees could receive a pension and use a defined contribution plan.

He said the new plan is the result of input gathering and careful decision making.

“This is something we feel is going to help us remain competitive in the workplace and continue to get the best employees we possibly can in the near future,” Basi said.

The board will decide whether or not to give its final approval at a later meeting.

UM System President Choi said he is confident the board will vote in favor of the changes.

“We don’t have any doubts that this will not receive final approval,” he said.

Choi said the retirement plan changes are meant to help keep the program solvent.

“We knew that going into the future that we could not sustain this same level of support in the defined benefits component,” Choi said. “So we need to move to a defined contribution and the best way for us to move forward is to keep everyone that is currently in the hybrid program, which has defined contributions and defined benefits, whole.”

He said employees also expect portability now.

MU Faculty Council chairman Clark Peters said moving to one plan and away from the hybrid makes sense because the hybrid was causing confusion. He said some faculty at MU have concerns about the updated plan.

“The concerns are first that, yes, the people won’t save enough for their retirement,” Peters said.

“The other concern, I think, is that University of Missouri is characterized by sort of being on the low end of salaries for faculty and staff. And one thing we could always point to was that relatively generous retirement benefits,” he said.

Peters said salaries are really what need to be reviewed.

“As the university moves forward I think it’s important to remain competitive when we work to hire the top faculty and staff for our positions. Traditionally we’ve had a really terrific retirement package and as that changes we just need to make sure that our entire compensations package is competitive,” Peters said.

Peters said these types of plans do allow people to move on to other types of positions if they want without having to stick around to get benefits.

“I do think that the administrators had the interests of faculty in mind,” he said.

Choi gave curators updates on freshman enrollment during the meeting. Freshman applications are up at the Columbia campus by 5.7 percent and admissions are up on the campus by 11 percent.

He said the university needs to improve numbers of acceptances from freshman sent in with deposits, even though those numbers were up on the Columbia campus by 37.1 percent.

Choi also talked about what he is calling the “highest priority” in the University of Missouri System, the Translational Precision Medicine Complex.

An early concept on the design for the $220 million complex was presented to university staff and faculty on Wednesday.

“Thus far, we’ve raised $4.3 million towards a $75 million goal,” Choi said.

He said the complex would provide “laboratories without walls.”

Other topics included new degree proposals for an occupational therapy doctorate and master of athletic training. After discussing the reach of the occupational therapy degree and the possibility of having a satellite program, the curators approved both proposals.

The board also discussed a minor raise in housing and dining rates for the UM System campuses outside of Columbia. UMKC’s rates will increase by 2.8 percent, an increase of $294. Missouri S&T’s will increase by 2.2 percent, an increase of $223. University of Missouri-St. Louis’s will increase by 2 percent, an increase of $200. Housing and dining rates have already been voted on for the University of Missouri Columbia campus.

Columbia campus Chancellor Alexander Cartwright gave highlights on the Columbia campus. He talked about recent sanctions imposed on MU Athletics.

He said the university will appeal those sanctions, and said the teams did the right thing by reporting the issue.