Kirkwood retirement incentive nets 49 takers, saves nearly $2 million

CEDAR RAPIDS - Nearly 50 Kirkwood Community College employees will retire by the end of August, taking advantage of an enhanced retirement incentive the school crafted in response to steep state funding cuts in the last budget year softened only slightly by a modest increase in appropriations for the current year.

Of the 49 vacated positions, Kirkwood won't refill 22.

By cutting those jobs and decreasing salary expenses through new hires making lower wages, Kirkwood expects to save about $1.9 million, officials told The Gazette. Additionally, the Cedar Rapids-based community college has saved $1.5 million through operational efficiencies - doing its part to manage state budget woes that prompted lawmakers in the last legislative session to claw back tens of millions in support from Iowa's public universities and community colleges.

Kirkwood additionally approved an $8-per-credit hour tuition increase for in-state students for the upcoming school year - bumping rates from $154 per credit hour to $162. Non-residents will see an $18 rate increase, from $184 per credit hour to $202, and international tuition went from $308 per credit hour to $324 - a $16 increase.

The strong response to Kirkwood's retirement incentive kept those increases modest, according to Kevin Hansen, executive director of marketing for Kirkwood.

'We would anticipate the tuition increase would have been higher without the incredible response to the enhanced early retirement incentive,” he said.

The college is not immediately disclosing details about the operational efficiencies it expects will save $1.5 million, but Kirkwood President Mick Starcevich said the overriding goal is to balance the budget with minimal impact on students.

'What we've tried to do is hold our students harmless in every cut that we've made,” Starcevich said. 'So we're looking at innovative ways to save dollars. And we've been very good at that on the operations side of the budget. And we continue to try to refine those.”

As far as the enhanced retirement incentive goes, the Kirkwood board in May agreed to sweeten an existing standard incentive, which was in place for staff who are 55 years old or older with 10 years of full-time consecutive board-approved employment. That standard incentive provided a cash incentive of 5 percent for every year of full-time employment - not to exceed 100 percent - along with single medical, dental and vision premiums paid until Medicare eligible.

The enhancement, by upping the cash incentive to 150 percent, more than tripled the number of typical retirements in a year. Those who took it must leave between June 30 and Aug. 31.

'We've taken some big steps in cutting costs already,” Starcevich said. 'And we're going to continue to do that as we work with lower state financial support.”

Like Iowa's public universities, its 15 community colleges have seen state appropriations erode over the years - including in the last legislative session, when lawmakers took back $4.7 million in community college funding. Kirkwood's portion of that 2017 state aid cut was $746,000.

Unlike the regent universities, the community colleges saw a $1.6 million increase for the 2018 budget year that began July 1. For Kirkwood, that translated to $261,000 over the lowered 2017 base funding level, meaning its new allocations total remains about $500,000 below the 2017 mark.

l Comments: (319) 339-3158; vanessa.miller@thegazette.com