Officials say contract isn’t certain
April 17, 2001
Soda pop may be bringing more than refreshment to ISU students, as officials solicit contract proposals from beverage companies in hopes of generating more money for the university.
Warren Madden, vice president for Business and Finance, said the solicited proposals vary in the levels of services and degree of exclusivity and are still being discussed.
“I think it’s been misleading that we’re about to make a deal,” he said.
The university received proposals from Coca-Cola and American Bottlers in March, he said, but Pepsi-Cola did not submit a bid. It is not likely the campus will make an agreement with American Bottlers due to its lower popularity status, Madden said.
He said an agreement with Coca-Cola could bring in more revenue by tying together the several already existing contracts on campus into a single contract. Currently, the Iowa State Center, residence halls and the Memorial Union food court, with the exception of Subway, have an agreement with Coca-Cola.
“When we compare what happens at Iowa State with other schools, we’re not generating the level of revenue,” Madden said.
He said while Coke is “providing the vast majority of beverage service on campus,” these smaller agreements with different expiration dates do not receive as much national advertising campaign revenue.
“If we can generate several thousand dollars of revenue for it, it’s definitely worth exploring,” Madden said.
Carl Mize, associate professor of forestry, said a monopoly of beverages on campus would not be in the best interest of the school and said Iowa State may be “cheapening itself in the process.”
“Generally, consumers lose when monopolies exist,” he said.
Mize said Iowa State has become a business interested more in “the almighty dollar” than in the education of students.
Chris Schilling, college representative for the Faculty Senate Council on Resource Planning and Allocation, said it is important to determine whether Iowa State would compromise its core values through the agreement. Schilling, associate professor of materials science and engineering, suggested making the decision an academic exercise.
“Let’s get all the facts on the table and let the public decide if it’s a good thing or not,” he said.
Madden said while the possibility of generating more money for scholarships, student activities and events are a positive side to the agreement, it does have its drawbacks.
Some of the suggestions made by Coke, including exclusivity in campus and residence hall convenience stores, are not warranted, he said.
“I don’t think the campus will have an exclusive brand no matter what happens,” he said.
The university can agree to all or parts of Coke’s “laundry list,” but Madden said when exclusivity rights decrease, less revenue comes in.
Madden said he formed an advisory committee consisting of representatives from student government, residence halls, the athletic department, the Memorial Union and vending operations to decide on the matter.
Madden said the committee hopes to submit a recommendation to Interim President Richard Seagrave sometime in the next two to three months, allowing time for potential changes to be phased in during the 2001-2002 academic year.
Because Seagrave is leaving the president’s office July 1, he said he does not know who will make the final decision on the matter, but he is confident a decision will be made in the best interest of the university. While bringing in revenue is important, Seagrave said maintaining a positive image to the public is a bigger concern.
Madden said bottle advertising is expected in sports arenas, but this should not carry to the campus.
He said beverage contracts are not new to universities. “A number of Big 10 and Big 12 schools have done this.”
If the committee agrees to a contract, Madden said students would still be able to bring beverages on campus from other outlets.
“We’re not going to create a pop police,” he said. “We don’t do that now, and we won’t do it in the future.”