A Board of Regents task force is examining the benefits paid to the thousands of employees of the three state-supported universities and ways they can save money on those benefits.
Regent Robert Downer of Iowa City is leading the task force and says they are operating on several assumptions, one being the Regents and the institutions will be facing the "worst financial crisis that they have ever faced" in the 2011 fiscal year.
Downer says federal stimulus money helped put of the crisis in the upcoming fiscal year that begins July 1st — but he says they believe that it is "highly unlikely" that there will be any stimulus money in the 2011 fiscal year, so they need to take action to prepare.
Downer says information from the Regents staff shows the cost of benefits at 500 to 600-million dollars each year. He says some benefits for Iowa State, Iowa and Northern Iowa are very similar, but other benefits vary widely. Downer says the task force has a goal of cutting the benefits by 10%.
"That in my mind at least is not necessarily the equivalent of a reduction in benefits…of that magnitude, but we do feel that there are at least possibilities for efficiencies for more effective deployment of the resources that we have, etcetera," Downer says. Downer says the believe savings are possible because they found an inverse relationship between the size of the payroll of the universities, and the cost for benefits.
Downer says for example, the University of Iowa has the largest payroll and the smallest percent of its payroll going for benefits, so there could be a chance to combine benefits and see some economies of scale. He says it’s not known if that approach has ever been looked at before.
Donwer says making the changes to get all the benefits uniform will take some work. Downer says there are some areas where legislative changes may be necessary, and there are other cases where collective bargaining agreements may have to be looked at.
He says the changes will require them to "enlist the assistance of large numbers of people and groups as we go forward on this." Downer made his comments at the Board of Regents meeting in Ames.