For the last two years, the Supplemental Retirement Program (SRP) has been offered to Delta staff.
It affords employees who have been working for awhile to retire earlier without losing a lot of what they earned and gives Delta a way to save money.
When SRP was offered last year, Danner Hall’s hot grill was shutdown as a result of staff loss, leaving students to find hot food elsewhere. Position replacement isn’t guaranteed.
According to Delta Vice President of Administrative Services Chris Nguyen, Delta College’s revenue and expenses have been unbalanced for at least a couple years, with expenses being higher than revenue by one percent.
“The expectation is that we work out a plan to ensure that we don’t overspend or spend more than what’s in our budget,” said Nguyen. “Our expenses are expected to increase faster than what we are getting from the state every year and it’s going to eat into our reserve and we’re going to burn through our reserve within four years.”
Because of this imbalance, the Delta Board of Trustees have been looking for a way to close the gap using the SRP program.
“This is an opportunity to basically lower our expenses with either not filling that position because we may not need to or, if we do fill it, we fill it with new employees so one, it’s less expensive and two, we have new employees that can come in and be a part of the institution,” said Nguyen. “The bottom line is that our expenses are growing faster than our revenue.”
Nguyen described the operational impact and how it will vary depending on who retires and what job they have.
If it was a professor who taught in a subject with five other professors, the impact of them taking the SRP may be small.
If it was a professor who was the only one teaching in a certain subject, the impact would be greater and it might be necessary for them to be replaced.
“It looks like it worked the last time,” said Board of Trustees President Catherine Mathis. “It saved about one percent on the budget and from what I have been hearing, it’s looking like we’ll have significant savings this time as well.”
More than 95 percent of Delta’s budget and revenue comes from the state, based on the school’s enrollment — which has been low recently.
“We don’t have the enrollment that we’d like to see,” said Mathis. “We’re not bringing in money from the state per student that would cover the expenses of the employee and maintenance for the school.”
As of the 2016-17 school year, Delta had 13,515 full time equivalent students, according to the California Community College Chancellor’s Office’s 2018 student success scorecard.
When Delta has a budget deficit, which it has in the last couple years, the gap is filled with money from Delta’s reserve, according to Nguyen.
The reserve is designed to be used for serious emergencies or to cover small budget deficit.
About 85 to 87 percent of Delta’s expenses goes to faculty salaries and benefits.
According to Nguyen, salaries are more or less fixed with about yearly incremental increases but the driving force that is causing Delta expenses to grow so rapidly comes from benefits — specifically medical expenses, which are growing faster than inflation is a common occurrence nationwide.
Currently, the other retirement packages offered for faculty include the Public Employees Retirement System program which is for non-faculty and State Teachers Retirement System which is for faculty and the medical expenses for each program is growing annually.
How does SRP impact students?
Depending on who gets replaced and who doesn’t, certain class offerings and departments will be altered.
“There are important positions that are not being filled right away,” said Mathis. “It’s something that the board would like to be aware of and consulted about.