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April 1, 2002

Senate votes on benefits measures

By Michael Terrazas


To begin the March 26 University Senate meeting, held in the Woodruff Library’s Jones Room, President Bill Chace reminded members of the upcoming Sam Nunn Policy Forum, to be held on campus April 5–7. Titled “Commercialization of the Academy,” the forum will feature its namesake, former Georgia senator Sam Nunn, along with former Harvard president Derek Bok, University of Georgia Provost Karen Holbrook and other notable guests.

Nearly all of the rest of the meeting was devoted to a discussion of the proposed changes to the University’s employee benefits package. First, George Benston, Harland Professor of Finance, Accounting and Economics, presented a study he’d done on endowment spending using financial figures supplied to him by the Office of Finance and the Treasurer. Using several percentage rates for endowment spending from 4 percent to 6.5 percent, Benston said his analysis shows an “unspent balance” on endowment spending from 1992–2001, the amount of which varied according to the different rates of spending.

Interim Provost Woody Hunter said Benston’s analysis did not begin with the correct baseline of endowment capital, which Hunter said accounted for the apparent unspent balance. Senate members expressed a desire for Benston to repeat the analysis using accurate figures supplied by the administration.

Next up, Sid Stein, chair of the Senate’s fringe benefits committee, presented the committee’s analysis of the proposed changes. Stein reiterated that his group felt its duty was not to determine whether changes to benefits were warranted, but rather to evaluate the proposed changes and suggest alternatives, where appropriate. Briefly, the committee’s conclusions were:

• supporting the imposition of a five-year cliff vesting period on University matching contributions to retirement plans, but opposing the proposal to cut the University’s maximum contribution from 10 percent to 8 percent.

• opposing both the current methodology to compute retiree health insurance premiums and the proposed changes to University contributions to retiree health benefits. Instead, the committee proposed (a) reincluding retirees age 55–64 in the expense pool to determine health premiums for all employees; (b) changing aggregate age plus years of service to determine eligibility for retirement health benefits from 70 to 75; (c) informing individuals who begin employment at Emory on or after Jan. 1, 2003, that the University will not contribute to their retiree health benefits.

• supporting the imposition of a graded Courtesy Scholarship based on years of service, elimination of the double-tuition benefit for hospital employees and instituting a flat 80 percent Courtesy Scholarship for employees taking coursework themselves.

Further, Stein’s report suggested the University separate itself from Emory Healthcare, freeing each entity to define its own fringe benefit rates. It also suggested the University reduce or eliminate its voluntary contributions to the VEBA (voluntary employees’ benefits association) trust, which is set aside to fund future liability for retiree health benefits.

After much discussion and two failed motions, the Senate moved to transmit the fringe benefits committee’s report to the University administration for consideration.

Bill McBride, former president of Employee Council, also moved for the Senate to endorse a resolution passed last week by the faculty of Emory College. The resolution calls upon the University to increase funding through available resources to deal with current economic shortfalls, rather than reduce employee benefits. The resolution also calls upon Emory to launch an “unprecedented capital campaign,” both to replenish any resources spent in the short term and also to enhance the University’s endowment in the long term. McBride’s motion passed by a vote of 9–5 with 10 abstentions.

In other business, the Senate approved five nominees from the honorary degrees committee to receive honorary degrees at Commencement 2003; the approved nominees now will be presented to the Board of Trustees, which gives final approval. The Senate also elected theology’s John Snarey as president-elect and the college’s Susan Lee as secretary for the 2002–03 academic year.

If you have a question or concern for University Senate, e-mail President Frank Vandall at