High-paid UC executives denied retirement benefits increase by UC Regents
By Devin Kelly
Jan. 5, 2011 3:16 a.m.
University of California officials rejected demands by UC executives seeking higher retirement benefits Tuesday, setting the stage for a potential legal battle.
In a Dec. 9 letter to the UC Board of Regents, 36 high-paid executives said commitments were made in 1999 to lift a cap on benefits for individuals making more than $245,000. The IRS lifted this cap in 2007, but the increases were never allocated.
The executives said they want the UC to fulfill those commitments. The letter calculates the cost to the University at $50.6 million to raise benefits for some 200 employees.
In their first public statement on the controversy, UC President Mark Yudof and UC Board of Regents Chair Russell Gould admitted that action was taken by the UC Regents to lift the cap.
The statement also acknowledged that the IRS granted approval.
But the University was not legally obliged to change the policy after the IRS gave it the green light, according to the UC statement.
Following IRS approval, a plan was supposed to be submitted to the UC President and the chairs of the Board and Finance Committee.
Because of the economic downturn, that never happened, according to the statement.
The UC contends that without the approval of a plan, the cap was never eliminated.
The issue is not expected to be on the agenda at the next UC Board of Regents meeting, which will take place on Jan. 18-20 at UC San Diego, said UC spokesman Steve Montiel.
It is not clear if the issue will require further review by the regents, Montiel added.
He said that both Yudof and Gould “feel prepared to defend their position in court if necessary.”
