Regents Take Action to Meet an Additional Two Percent Budget Cut

The Board of Regents of the University System of Georgia (USG) approved December 3rd in a special called meeting a change in health benefit plans for USG employees as well as a temporary fee for all USG students. The changes will help the System’s 35 colleges and universities meet an additional two percent reduction in the current Fiscal Year 2009 budget.

As a result of the board’s action today, as of Jan. 1, 2009, the employer contribution rate for health insurance for the System’s PPO and HMO health plans will be reduced from 75 percent to 70 percent. USG employees enrolled in these plans will thus pay increased premiums ranging from approximately $17 to $65 a month, depending upon the plan and number of individuals covered. The employer contribution rate for the Indemnity plan will be the same as the PPO plan. The employer rate for the System’s high deductible health plan will continue at its current level of 90 percent. This change will result in an additional $8 million in savings throughout the System.

Effective for the spring 2009 semester, all USG students will pay a temporary, one-semester fee: $100 at research universities and six other universities, $75 at most comprehensive universities, and $50 at two-year and state colleges. The fee will offset an additional $20 million in budget reductions at the institutions.

An additional $12 million in savings will occur as a result of instructions that allow all USG institutions to defer maintenance expenditures. This budget reduction measure initially was approved by the regents this past August and did not require additional approval in today’s meeting.

“These are difficult decisions,” said USG Chancellor Erroll B. Davis Jr. “The board’s action today will protect the System’s core teaching mission and maintain academic quality.”

The regents took action in August to reduce the System’s budget by six percent ($136 million), and also to approve contingency plans for additional reductions. Health care plans and the student fee were two components of these additional reduction plans.

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