In its latest move to bring down costs, the state higher education system is offering faculty an incentive to retire.

At its Jan. 15-16 board of governors meeting, Pennsylvania's State System of Higher Education approved a plan to pay up to 125 days of accumulated sick leave to faculty who agree by March 2 to retire by August. That plan more than doubles the maximum of 50 sick days paid out under the current collective bargaining agreement.

“We wanted to provide a meaningful option for faculty who are considering retiring in 2020,” said Dave Pidgeon, PASSHE director of public relations. “This is the second incentive option over the last six months that the state system has created for anyone facing that decision.”

Pidgeon added the plan is part of a system-wide effort in which the 14 state universities, including Slippery Rock University in northern Butler County, are undergoing a series of reforms and redesign.

“This is also an example of good government policy,” he said. “We are making a concerted effort to align our costs with revenue.”

PASSHE schools — along with other colleges and universities in Western Pennsylvania — are experiencing the effects of a demographic shift, Pidgeon said. High schools in the region are producing fewer graduates than in the past, meaning schools that predominately recruit in the region have fewer students matriculating.

“If there are fewer Pennsylvania students, that means universities may be facing challenges when it comes to revenue,” he said.

The state system elected to look toward retirement incentives because about 70 percent of its $2.33 billion operating budget goes toward staff salary and benefits, Pidgeon said. Salaries are paid out of the $1.6 billion education and general fund, which includes salaries, benefits, financial aid, utilities, services and supplies, but doesn't cover room and board costs.

Pennsylvania ranks 47th in the United States in terms of investment into public higher education. That, in addition to the demographic shift, potentially hurts PASSHE enrollment, adding more pressure to cut costs, according to Pidgeon.

“That puts a lot of upward pressure on tuition, which then in turn has an impact on potential enrollment,” he said.

Pidgeon said 76 faculty have expressed interest in participating in the retirement program — officially the enhanced sick leave payout program — as of Jan. 17. The program will only be implemented if 200 faculty members agree by March 2 to retire by Aug. 14.

SRU declined to comment for this story.