The South Dakota State Board of Regents has proposed a payroll date change that could fund bringing the state's six university campuses up to speed with wireless technology. However, the plan affects employees planning to retire in the next three years.

The board plans to push its payroll date back one day for all employees in 2009. The timing, with a change of fiscal years, would free up almost $11 million for technology upgrades, regent president Tad Perry said.

The transition would begin between June and July 2009, which means the paycheck for the last month of the fiscal year would be paid in the following fiscal year.

Employees would still earn the same amount of money. Funds from the overall appropriation approved by the state would be transferred to equipment needs in a one-time proposal.

The plan is designed to support the overall goal of updating the university's mobile computing environment so students are better prepared for the work force. By 2011, more than half of the state's students are expected to graduate from school environments that integrate laptops into the curriculum, Perry said.

For most of the higher education system's 5,600 employees, it could mean changing mortgage payment dates that are usually scheduled for the first of each month and realigning health benefits for the transition.

"Is it inconvenient? Yes," Perry said. "It's a pain, but it's not going to damage you. … We're trying to be as reasonable and as rational as we can be."

It's more than inconvenient for the people planning to retire, said David Boyles, faculty senate president at the South Dakota School of Mines & Technology in Rapid City.

The South Dakota Retirement System formula is based on the best 12 consecutive quarters of the past 10 years. For most employees, their peak salary is closest to retirement. But if employees retire during the next 12 quarters, their retirement checks will be smaller because it will reflect the year that includes fewer paychecks.

Perry said about 150 employees retire each year from the system and that he is aware of the problem the change would create. He said those planning on retiring would need to decide if they want to retire before the transition, wait until after, or go ahead with it.

Boyles said employees affected negatively by the change should be compensated. For an employee who makes $50,000 and decided to retire during the transition period, it would equal a loss of $31 a month over the lifetime of the retirement benefit payment.

The board researched ways to exempt those employees or set up a separate account and compensate them, but it isn't possible, Perry said, because of federal employment laws and IRS regulations.

"If there was a way to do it, we would have done it," he said.

The board will present the plan to the Legislature next year and ask for $3.8 million each year to invest in technical support faculty. The legislators would have to approve that appropriation as well as using the $10.9 million in deferred payroll money to upgrade classrooms, train faculty and implement the wireless systems on campuses.

Deb Sloat, human resource director at the School of Mines, said she has gotten mixed feedback about the plan. The employees about to retire are "very distraught," she said. "The people who aren't retiring and know we need the technology, it's not a problem," she said. "And there are some employees who are disgruntled no matter what."

The university system is still in the process of informing and educating employees, Perry said. He also is spending his time talking with legislators who are "attentive and listening."

The universities operate on an almost $600 million budget and can earn revenue through three ways: state appropriations, student fees and tuition or internal changes.

If the money came from students, fees and tuition would have to be increased by about $550 per student per year, Perry said, which regents don't support.

Relying on $10.9 million from the state, on top of the $3.8 million, when it typically receives between $5 million and $6 million in appropriations each year, is also not realistic, he said.

Moving money around, even if it is an inconvenience, is worth the long-term goal of providing students with a quality education, he said.

But Boyles said faculty senators disagree and believe that alternative options should be considered.

"The wisdom of the Legislature has to be considered, as well as South Dakota taxpayers," he said.

The appropriation

The South Dakota Board of Regents plans to ask the state Legislature for $3.8 million, to be appropriated every year, and move its payroll date forward one day to use $10.9 million of payroll funds for technology upgrades.

The board says the $10.9 million would:

* Convert the six state universities into wireless campuses.

* Update classrooms to accommodate for technology curriculum.

* Invest in faculty technology training.

The $3.8 million would support 43 full-time employees. Some would serve as instructional technical staff to assist faculty in implementing technology into curriculum (one instructional tech staff member for every 100 faculty members). Some would assist with technical support (one technical support staff member for 800 computers).

Contact Kayla Gahagan at 394-8410 or kayla.gahagan@rapidcityjournal.com