In yesterday's Faculty Senate Executive Committee meeting, faculty members discussed a proposed reduction in state contributions to faculty retirement accounts.
University President John T. Casteen III attended the meeting and addressed the retirement plan cuts.
In the budget for the next fiscal year, Gov. James S. Gilmore III proposed the state reduce its contributions to optional faculty retirement plans from 10.4 to 9.24 percent for all Virginia colleges and universities.
The proposal would save the Virginia government about $3.5 million.
The Faculty Senate is concerned about the proposed cut, former Faculty Senate Chairman David T. Gies said.
If the proposal is passed, lifetime losses for individual faculty members could total about $100,000, Gies said.
Faculty members presented a possible scenario at the meeting detailing calculated losses that might result from the proposal.
In the scenario, despite the natural yearly increases in faculty salaries, the loss of government funds still will prove detrimental to the yearly returns on the faculty savings plans.
The scenario was based on the salary of a 40-year-old faculty member earning $80,000 annually, which increased by an average rate of 4 percent per year. Faculty members would also receive an 8 percent return on the money they invested in the retirement account.
There are two retirement plans available to faculty members, the Virginia Retirement System and the University of Virginia Faculty Retirement Plan.
Faculty members are allowed to belong to only one of the plans, and no other options are available.
"A really small number [of faculty members], less than 2 percent, probably" belong to the VRS, said Colette Sheehy, vice president for management and budget.
But nearly all faculty members are part of the University plan.
The University plan has existed since 1927, while the VRS plan was established in 1991.
Sheehy said the recent development of the VRS plan is one reason why fewer faculty may belong to it.
The governor's proposed cut would apply to both retirement plans. Therefore, the impact of the proposal on University faculty is significant.
The Faculty Senate plans to voice its concerns by writing letters to state legislators, Werhane said.
"We are trying to mobilize, trying to get to our local legislators" to stop the proposed cuts, Gies said.
The state legislature is still in session and has not voted on the budget yet.
Nobody from Gilmore's office could be reached for comment.
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