Approved Minutes For Meeting On May 16, 2011-12

Date: May 16, 2012 (2011-2012)

Program:

1. The meeting was called to order at 1:02 p.m. by the Vice Chair, Lori Stettler. Visitors and guests were welcomed and introduced.

2. Roll Call

Members Present: Tuesday Ashner, Natalie Branca, Steve Buhman, Don Castle, Janet Douglas, Pat Eckert, Jon Geiger, Charlotte Sarao, Lori Stettler, Valerie Brooks Wallin.

Members Absent: Maureen Doran, Alfred Jackson, Meredith Thomas, Sue Tin, Gloria Yuncker.

Proxies: Jon Geiger for JP Dunn; Lori Stettler for Kathy Jones.

Visitors and Guests: Jake Baggott, Tracy Bennett, Jennifer Franklin, Jill Gobert, Keri Young.

3. Minutes

The minutes of the meeting on April 18, 2012, were approved as presented.

4. Adoption of Meeting Agenda: J. Geiger moved to approve the agenda as presented; seconded by C. Sarao. Motion carried.

5. Reports

5.1 Chair 
L. Stettler reported that JP Dunn is attending a meeting out of town, and she is chairing this meeting in his absence.

5.2 Board of Trustees 
L. Stettler (for JP Dunn) reported the Board met on May 10 Edwardsville. Most of the discussions that took place were held in the committee meetings rather than at the full Board meting. Each of the individual items on the agenda were voted on independently rather than on an omnibus motion. Highlights from the meeting include: i) presentations by all three of the campuses on the Minority, Women and Disabled Students, Faculty and Staff report; and ii) discussion on the current initiative by the Internal Audit Office to conduct audits in other departments throughout this year. Agenda items approved include: i) all the tuition and fee increases; ii) temporary financial arrangements for FY13, as well as approval of software contracts; iii) the 2013 Operating and Capital Budget Planning Guidelines; iv) the University Housing Master Plan and its adoption into the Carbondale campus master plan; v) the renovation of Pulliam Hall and the roof replacement for Lawson Hall; v) naming of the Dan Callahan Clubhouse, the Lew Hartzog Track and Field Complex, the Richard "itchy" Jones Stadium and Connie Price Smith Throws Area. Additionally, the Edwardsville campus produced a thank you video for outgoing Chancellor Vandegrift for his years of service to their campus. There was also a recognition resolution for his wife, Sue.

5.3 Human Resources (HR) 
T. Bennett reported that benefits choice information has been mailed out. Once the health care carriers are finalized, there will be plenty of time to make a decision. Other benefits decisions can be made up until June 15. T. Bennett also reported that HR received its interim audit response back from the Civil Service Systems office. As expected, there were some A/P positions that were identified for review to determine if they should be civil service. She anticipates HR will be reviewing at least some of them. C. Sarao asked about the number of employees affected. T. Bennett responded that there are approximately 30 positions that have been identified; however, there could be a ripple effect because if there is more than one person [in a department] with the same job title, those will have to be changed as well. She noted that although [state statute requires that these determinations be made], it is up to the University administration as to whether to comply. The campus has always had a good relationship with the Systems office and have worked hard to abide by the rules.

S. Buhman asked whether the staff in the positions being audited have been notified of the audit. T. Bennett responded that if she conducts an audit, then she will have to meet with them. If she does a position description review, the staff in those positions may not realize [why]. However, if it gets to a point where positions are being converted, then absolutely those staff will know. T. Ashner commented that some departments could be hurt if they have to convert an employee or employees to civil service because A/P work 40-50 hours a week. She questioned how the remaining employees in a department would be able to handle the [overload].

5.4 Representatives to University Committees

5.4a Traffic and Parking - To be rescheduled.

5.4b Computing Advisory - To be rescheduled.

5.4c SURS Members Advisory - Jake Baggott 
J. Baggott reported the committee met on May 8. There are three pieces of legislation and the Governor's proposal that are of interest. If adopted as proposed, employees will be forced to make a decision as to whether to stay with the existing retirement benefit and give up health insurance or accept lesser benefits and work until 67 years of age. All the rhetoric indicates any changes will be phased in, but there are no details available at this time. J. Baggott pointed out that the pressure on the state to make a decision is immense. There has been discussion about using bond to finance different needs, but that will be difficult to do if the state receives a reduced credit rating. The thought is that if nothing is done to change the pension and Medicaid obligations, the state's credit rating will tank. If the Governor's proposal passes, they say it will not affect existing retirees, and until the phase-in details are known, great caution should be used in making a decision about retiring. The Governor's proposal is expected to save between $65-$85 billion in the next 30 years. J. Baggott believes, however, that the System will take a big hit as soon as the number of people who are expected to retire do retire because the System will have to start paying out. This means that there will be less people paying into the System, so it is a conundrum. The Governor believes 75% of state employees will elect the revised plan; that may be true, but there is no question that lawsuits will occur. The Governor feels fairly confident that because people are being given a choice, it will stand up in court. There have been instances in other states where people have been given "choices." In some cases, the courts have ruled that if participants are given a choice, the trade-offs do not actually have to be equal. J. Baggott believes that whatever happens, the issue will be tied up in the courts; that does not mean, though, that it will not be implemented. The university and college presidents and chancellors have been advocating on behalf of employees and their institutions to try and minimize the changes that are taking place. This issue obviously affects recruitment and retention. Tier II is already a big disadvantage, and until something is done to change that, it will only become more difficult to hire. It is possible that any legislation that is passed could take effect on July 1; however, it does not make much sense to only give people a 30-day window or less to make a decision. There are people already making decisions just on the fear of a change.

J. Baggott reported that one of the bills of concern addresses retirees returning to work. This campus has been struggling with how to manage this issue. Public perception is that there are a lot of double-dipping and sweetheart deals occurring. There are certainly isolated examples that have been identified across the state, but in general that is not the case. If [House Bill 4996] passes, it will make it very difficult in the future to hire an annuitant, even when it might make sense to do so on a short term basis. The bill does not ban the practice, but it puts a price on it for the institution. If someone is identified as an "affected annuitant," then the hiring university will eventually have to pay the cost of the annuity back to the System. There are certain criteria that need to be met before someone is considered an affected annuitant; it would be anyone who is paid more than 18 cumulative weeks after August 1, 2013. Once that threshold is reached, and compensation is equal or greater to 40% of the person's highest annual rate of earnings, then the University will have an obligation to pay back to SURS basically the cost of the retiree's annuitant payment for the year. The bill makes it very cost prohibitive for the institution to consider doing that other than in very isolated, one-time opportunities. SIU does have a policy for re-hiring retirees, which does not allow retirees to be hired back into the same position from which they retired. There are some exceptions, such as faculty teaching class part-time; people on funded research who are key to that activity; and temporary part-time help.

J. Baggott reported the next bill, which the Governor is expected to sign, is Senate Bill 1313 (the health insurance bill for retirees). If it is signed, and he sees no reason why it will not be, it will mean the end of fully paid health care after 20 years of service. Rather, it lays the decision about how much employees will pay on the desk of the director of CMS. There is no clarity on how that will be implemented, either. J. Baggott indicated that there is some indication they will look at years of service, pay and age and come up with some scale that considers those factors to determine how much employees will pay out of pocket. What is clear is that current employees and retirees are going to pay something. That opens the door, then, for the Governor's proposal to do away with pre-paid health insurance completely. J. Geiger asked if any annuitants will be grandfathered in? [No.] P. Eckert pointed out that there are annuitants who are not eligible for Medicare. The State Universities Annuitants Association (SUAA) believes the number to be between 6,000-7,000. They ask that if anyone knows of any retirees who are not eligible for Medicare to please contact the SUAA office; when the Senate Bill was passed, they (legislators) were not thinking about those retirees, who will end up with nothing.

P. Eckert asked J. Baggott if there has been any discussion about the constitutional amendment. The concern is that the language being proposed could open a back door to challenge the pension statement. J. Baggott responded that the System's analysis is that the amendment largely has to do with the threshold for approving benefit increases, which would require a two-thirds vote of the House and Senate. The likelihood of getting a two-thirds vote on any increased benefits under healthy circumstances is remote. He was unsure how it opens a back door. P. Eckert responded that she was forwarded a response that SUAA had prepared in terms of where in that language they have concerns. V. Brooks Wallin indicated it was something about the new language superceding previous language and that the court could view it as the initial language being replaced by the new language. J. Baggott responded that the constitutional amendment would have to be voted on by the public, and frankly, generous state employee pension programs are not very popular with the public right now. He noted that the average annuitant receives approximately $20,000+ a year in retirement and is age 60. J. Geiger asked if [employees] are not doing enough to inform the public of the reality, including the fact that some retirees are not Medicare-eligible. J. Baggott responded that there has been much effort to communicate; there is just not much sympathy. P. Eckert commented that there needs to be some re-educating done on employees themselves. She has run into five people within the last eight days who have no knowledge of how being in SURS affects Social Security. They may have their quarters in for Social Security, but they do not understand that if their spouse does not work in SURS, and is fully eligible for Social Security, they (the SURS employee) will not receive survivor benefits. The public does not understand that the impact of all these other changes will put employees in worse shape.

J. Baggott reported that SURS normally has approximately 500 applications for retirement (state-wide) by April. At this time, they actually have a little over 1,000 and expect somewhere between 1700-1800 by the end of the year.

5.4c Chancellor's Planning and Budget Advisory - Tuesday Ashner 
T. Ashner reported the committee is scheduled to meet on May 21.

5.5 Standing Committees

5.5a Executive Committee 
L. Stettler reported the committee discussed the agenda for today's meeting, as well as preparing for the election of officers.

5.5b Committee on Committees 
J. Geiger presented his final report, noting a goal for next year is to encourage more people to volunteer for committee assignments.

5.5c Constituency Relations 
V. Brooks Wallin presented the committee's final report. T. Ashner commented that she thought the meeting went well. She appreciated the new location, as well as being able to meet the new basketball coach.

5.5d Operating Paper 
The committee submitted its final report.

5.5e Staff Benefits and Welfare 
C. Sarao presented the committee's final report.

[All final reports were included as an attachment to the May agenda.]

 

7. Old Business - None.

8. New Business

L. Stettler presented certificates of appreciation to outgoing Council members Janet Douglas and Tuesday Ashner. Certificates will be mailed to outgoing members Maureen Doran, Sue Tin, Gloria Yuncker and Alfred Jackson. L. Stettler thanked all for their Council and committee service.

9. Announcements

10. Adjournment

The meeting adjourned at 1:59 p.m.