WEST LAFAYETTE – An early retirement package has been offered to more than 1,600 Purdue University staffers with hopes that it will cut personnel costs by $6.6 million a year, school officials said.

Purdue administrators made the offer to professors and staff members who are at least 60 years old. They have been trying to reduce an anticipated $67 million budget shortfall over the next two years following state budget cuts.

Officials expect up to 500 people to take the incentive of up to half their annual salary and a five-year allowance toward medical expenses.

“I think it’s clear from the past couple of years that we’ve done everything we can to preserve the workforce by delaying hiring last year and by taking no raises for two years in a row,” Purdue President France Cordova said. “So our emphases are clearly doing everything we can against involuntary layoffs.”

Walt Branson, IPFW vice chancellor for financial affairs, said about 130 employees are eligible for the retirement package. He said it was difficult to tell how many employees would take the offer, but gave a tentative estimate of 25 percent. Purdue is the governing body for IPFW.

The university’s trustees unanimously approved the plan Monday during a meeting at Indiana University-Purdue University Indianapolis.

Up to $30 million could be spent on separation pay for employees accepting the offer, said Al Diaz, Purdue’s executive vice president for business and finance. But administrators anticipate that only two-thirds of those leaving will be replaced.

The trustees vote came hours after Gov. Mitch Daniels told a gathering of state university officials that they shouldn’t expect a return to previous state funding in the near future. Daniels in December ordered a $150 million, or 6 percent, reduction in state higher education funding through next June.

Devon Haynie of The Journal Gazette contributed to this report.