Davis Faculty Association

Archive for August, 2010

Student loan debt has surpassed credit card debt for the first time in history

Interesting post on the College Scholarships blog:

“According to June 2010 statistics, Americans owe more money in student loans than they do on their credit cards. As of two months ago, student loan debt was at $829.785 billion, while credit card debt was at $826.5 billion… Another reason behind this depressing milestone could be because of changes to the federal bankruptcy law in 2005 which has made it “nearly impossible to discharge student loans in a bankruptcy,” according to Robert Baker, director of education at Housing and Credit Counseling Inc.”

Full post at http://www.collegescholarships.org/blog/2010/08/31/

Post-Employment Benefits Taskforce Report Released

The post-employment task force has released its report and it is available online at: http://universityofcalifornia.edu/sites/ucrpfuture/task-force-report/

UC President Yudof distributed a letter about the report in advance of its release. Here is an excerpt: “The first issue to be addressed concerns employer and employee contribution levels to the UC Retirement Plan (URCP).  I expect The Regents to take action on these levels for the next two years at their September meeting.  For represented employees, those contribution rates will be subject to collective bargaining, as will most other changes to UC’s retirement programs… One of the other key issues concerns how best to structure UC’s pension plan.  Most employers have adopted or switched to a defined-contribution plan, but the Task Force felt that UC should continue its defined-benefit program because of the security it offers faculty and staff, and the advantages it offers the University in recruiting and retaining valued employees.  Defined-benefit plans, also known as pensions, guarantee employees a certain level of retirement income, based on a formula that factors in retirement age, years of service and pre-retirement earnings.The Task Force recommendations call for allowing current employees to continue in our current pension plan.  To ensure that the plan is affordable over the long term, the Task Force also recommended that the University offer a new pension option called a new “tier,” to faculty and staff who join UC after July 2013.”

The full letter is available at: http://universityofcalifornia.edu/sites/ucrpfuture/news-updates/president-yudofs-letter-810/

Every staff and academic senate members of the work groups of the president’s task force on post-employment benefits issued a dissenting opinion that is available at: http://universityofcalifornia.edu/sites/ucrpfuture/files/2010/08/peb_dissenting_082510.pdf. They feel “the Steering Committee of the President’s Task Force on Post-Employment Benefits (PEB) has made a number of recommendations, including some that we believe would be very harmful to the University. While we agree with many of the specific recommendations made, the overall emphasis on the part of the Steering Committee has been to promote cost cutting over the preservation of sustainable, competitive retirement benefits… It does not sustain UC to offer uncompetitive benefits or uncompetitive total remuneration to active employees, or to provide a less than secure retirement to retirees. Although both staff and Academic Senate participants have repeatedly and consistently emphasized the need to remain competitive, one of the pension options recommended by the Steering Committee is highly uncompetitive; the other option would be competitive only after substantial salary increases. Hence, the Steering Committee has not achieved one of its fundamental objectives, and we cannot endorse their report.”

There has been a large amount of media coverage of this. The Daily Californian has a good overview at: http://archive.dailycal.org/article/110146/uc_struggles_to_fill_multi-billion_dollar_pension_

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