By Wojtek Dabrowski
Ryerson has finally decide how to spend its $54.5-million question. The university’s administration and its employees have had this chunk of change sitting as an excess surplus in their pension plan fund, above the surplus cap allowed by Revenue Canada.
After months of meetings, the pension committee has split the money into three roughly equal parts:
- $17.6 million will go to the university, to be used on scholarships, new equipment and other student needs. This money will be made available at the rate of around $4 million a year;
- $19.4 million will go to improve pension benefits, such as insurance and dental care for staff and faculty;
- $17.6 milion will be apportioned among all beneficiaries of the money who contributed before 1996, and will be paid out in cash payments.
Money going to members of the plan will relate directly to their contributions, said Bill Buhlman, Ryerson’s manager of pensions and benefits.
He said the exact disbursement formula is still in the works.
Ryerson’s excess surplus accumulated as a result of shrewd investment of the plan’s funds.
In 1998, the excess surplus grew to $54.5 million from $1.3 million in 1995.
This means it has grown about fifty times in size in less than four years.
Linda Grayson, v.p. administration and student affairs, is one of the people who controls how the university spends its share of the excess surplus.
With the university’s budget balanced, Grayson said the funds can be used exclusively for campus improvement.
“There’s no such thing as too much money,” Grayson said. “You could give me $30 million per year and it would still not be enough to cover everything.”
From the university’s share of the money, $250, 000 will be spent on bursaries and entrance scholarships, and $500,000 will be set aside for Y2K contingency plans.
Some of this money will also be used to buy the Bond International College School building, at 111 Bond St. last March.
The new building will house physical plant staff, who are moving from East Kerr Hall.
The relocation will free up office and lab space for the engineering department in East Kerr.
Pension plans are allowed to have surplus funds to offset market flunctuations.
However, a 1992 amendment to the INcome Tax Act put a cap on how much surplus is allowed, to restrict a money-making organization from hiding money in its pension plan.
The Ryerson Retirement Pension Plan has to conform to this regulation.
Before determining how to divide up the the excess surplus, the pension plan committee, with representatives from the faculty, support staff and administration, decided to reduce members’ contributions to the plan, in a 1.5 per cent cut.
As of January, 1997, 1, 107 members of Ryerson staff and faculty contributed to the pension fund, and 333 people drew pension benefits.
The committee also temporarily stopped all administration contributions.