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NEWS RELEASE

10/16/96

CONTACT: Stanford University News Service (415) 723-2558


Tuition benefit to be maintained for current staff

STANFORD -- Provost Condoleezza Rice told members of the Faculty Senate on Oct. 10 that the tuition reimbursement benefit will continue, unchanged, for all staff and faculty on the payroll as of Sept. 1, 1998.

Rice said a committee would be formed to explore what will happen to the program for employees hired after that date. Stanford could continue to offer the benefit through savings and contributory programs or the flexible benefits program, or eliminate it altogether, depending on the recommendation of the committee.

"The days are long gone when we can simply, without examination, bear [additional] costs in the university budget," she said.

A recent federal government decision to scrap partial funding for the tuition reimbursement program -- a staff benefit available at dozens of schools across the nation -- prompted university officials to take a hard look at the feasibility of picking up the government's portion of the tab.

Stanford's benefit is limited to dependent children of regular full-time employees who have completed five years of continuous full-time service. It provides payment of tuition for the first four years of undergraduate work at any accredited college, university or trade school up to a maximum of one-half of Stanford's tuition.

Under the current policy, the university contributes two-thirds of the funding, and the federal government supports the rest.

Critics of the policy charged that the federal government has no business paying any of the tuition costs of university employees ­ a perquisite that isn't offered to employees of private companies conducting federal research.

But officials from Stanford and other schools that receive federal research grant money argued, unsuccessfully, that the long-standing policy provides a critical edge that allows universities to compete for highly skilled individuals without having to compensate at corporate salary levels.

Rice estimates that the annual cost of the benefit to the university will increase by $1.9 million as of fiscal year 2000, when the federal policy change takes effect.

"In the final analysis, although this is a considerable budgetary burden for the university, we believe that many employees have come to depend on this benefit," she said.

The provost's announcement came as a relief to many faculty and staff who have been counting on the benefit to help put their children through college.

"For one thing, it helped lower my blood pressure," said history Professor Al Camarillo, who has three children ages 8, 14 and 17. "This is a very important benefit for me, as my children are getting older and on the threshold of going to college," he said, during a telephone interview on Monday.

Nonetheless Camarillo said he is concerned that dropping the benefit altogether for future employees might have serious repercussions for the university.

"I fear we might lose some prospective faculty if our competitors decide to continue to offer the program in some form or another and we don't," he said.

At the senate meeting, Rice stressed the importance of determining the benefit's long-term fate in the context of the total benefits package that Stanford offers to its employees.

"This benefit, as popular as it is with employees, is a disproportionate one," she said, referring to the fact that it is only attractive to employees with children approaching college age.

"One has to ask, when you are out there recruiting, 'Do you want a benefit that only applies to a certain segment of the population or would you rather have the flexibility to meet the needs of employees who may have other concerns?' " she said.

The university, for example, has been experiencing stiff competition in hiring staff to work for its computing organization. "It's the case that [computer science] people tend to be very young when being recruited in and this benefit is virtually no good for [them]," she said.

Rice plans to ask the Faculty and Staff Benefits Committee to examine options for the future of the tuition benefit program and solicit the views of the university community in the process. The committee is expected to report back to her within six months.

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