ERB proposes min. retirement age

A surprise proposal voted on at Monday’s Education Retirement Board meeting would establish the minimum retirement age at 55 for faculty and staff.

UNM faculty said during a Faculty Senate meeting Tuesday the proposal was not one of six original proposals reviewed by the Faculty and Staff Benefits committee. The proposal, which decreases a retiree’s cost of living allowance (COLA) and establishes the minimum retirement age at 55, is news to them
Currently, the ERB doesn’t specify a retirement age but says educators can retire with full benefits after working for 30 years.

Faculty Senate President Timothy Ross said the proposal “fell out of the sky.”

“It was not one of the six that they asked all of the employees to consider and then vote on,” he said. “I’m thinking that what happened is they looked at the statistics of the votes on those six, and maybe saw something close to a uniform distribution, which essentially means that there was no overwhelming favorite and decided to pick something else.”

Mary Lou Cameron, the ERB chairwoman, said in a statement that the changes are being made to ensure the retirement plan’s long-term sustainability.

The proposal will be presented to the New Mexico Legislature’s Investment and Pension Oversight Committee on Dec. 2.

Ross said the proposed retirement age of 55 would not have a significant effect on faculty because college professors generally come to campus later in life, and by the time they serve for 30 years, they are usually 55 or older.

Ross said the reduction in the COLA is of greater concern to the faculty. The new proposal gives current and future retirees just 87.5 percent of the COLA that current retirees receive. The ERB COLA is based on the Consumer Price Index (a measure of yearly inflation) and typically begins the year a retiree turns 65.

“The cost of living issue allows your retirement to go up a small amount each year to accommodate inflation,” Ross said. “Any decrements in that cost of living figure hurt you in a cumulative way as you age.”

Mary Clark, Staff Council president, said the ERB came up with at least 40 different scenarios before arriving at the original six proposals. She said some of them favored younger employees over older ones, with younger employees being more concerned about the retirement age, and older ones being concerned with the COLA.

“You start at 20, you’re going to want to retire with 25 years at 55,” she said. “If they pushed that up to 62 … when you’re 25, that seems like an eon.”