Purdue University administrators earning more than $50,000 will be eligible for merit raises under a change to a plan President Mitch Daniels proposed last month to compensate for a two-year tuition freeze.
Daniels announced Tuesday that all employees will be eligible for 1-percent merit raises. His initial plan, announced in March, eliminated raises for senior administrators, deans and administrative and professional staff.
The plan is part of a series of cost-cutting moves designed to cover the estimated $40 million cost of freezing tuition rates through 2015. The last time Purdue went without a tuition increase on its main campus was 1976.
Daniels said the new plan will result in $7 million in savings through 2015. His initial plan would have saved $5 million.
"I'm convinced we have reached a far better outcome," Daniels said.
Daniels said he decided to make more employees eligible for merit raises after the second meeting of Purdue's new President's Council on Budget and Affordability. Purdue will tap an account previously budgeted to retain faculty and reward top performers to supplement the money already available for faculty raises.
Many administrators and faculty have offered to forego eligibility for their next raise or contribute to a fund that will replace the money that a tuition increase would have generated, according to a Purdue news release.
Council member David Williams hailed Daniels for listening to faculty input on the university's spending.
"I have been at Purdue for 40-plus years, and I believe we made history with the manner in which we reached this decision, for it has to be the first time Purdue faculty leaders had a say in how the university budget would be shaped," said Williams, vice chairman of the University Senate. "It truly is an example of shared governance."
The tuition freeze will keep the cost of basic in-state tuition in West Lafayette at about $10,000 a year,