Coca-Cola contract still in air

By Julie Compton | The Daily Targum (Rutgers University) | 5/2/05
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Ten years ago, University officials sat down with representatives of the multinational Coca-Cola Company to sign an exclusive beverage contract that allocated $1 million a year in corporate funds to the University.

Since that day, the term "exclusivity" has been the source of a much-heated debate among many members of the University.

While some argue the University should not open its doors to a corporation that has been accused of violating human rights at one of its Colombian bottling plants, others feel that a renewed contract with Coca-Cola is inevitable.

Vice President of Student Affairs Gregory Blimling, a member of the Exclusive Beverage Contract Committee, said the decision to select a beverage company will rely heavily on funding.

Along with state funding that has dwindled over the years, the University is becoming more and more desperate for external sources of revenue.

Blimling said the committee has sent out proposals to 10 different companies, including Coca-Cola.

While the accusation of human rights violations against Coca-Cola is a serious concern of the committee, Blimling said, the unproven accusations are unlikely to convince them to sign with a different company if Coca-Cola offers the most money.

Blimling said funding from any beverage corporation, regardless of how much or how little, will not directly affect the overall quality of education students receive, but it does provide revenues for special programs and events that the state budget lacks adequate funds for.

"[Without the funding], the University may not be able to sponsor programs that attract more faculty from under-represented groups, or to support a special program to support events like Ag-Field Day," Blimling said. "About $50-60,000 a year goes directly to the student government associations and about $10,000 will go to support Ag-Field Day this weekend. About another $10,000 will go to support RutgersFest."

Blimling said while a huge chunk of the funding gets funneled into the athletic department, about 40 percent of it goes to dining services.

He said the reduced wholesale prices that Coca-Cola provides in the current contract, prevents higher expenses for food.

Blimling said the committee has discussed the allegations made against the Colombian bottling plant with Coca-Cola representatives and has so far found no credible evidence to disprove Coca-Cola's innocence.

He said the representatives denied all allegations, and Coca-Cola, which is itself disconnected from the bottling plants, cannot be directly associated with any possible wrong doing in Colombia.

Amy Bahruth — an adjunct Labor Relations lecturer at the University who attended the meeting between the committee and Coca Cola representatives — said although Coca-Cola does not own the bottling plants in Colombia, it does maintain control over them through various means.

Bahruth said three top executives from Coca-Cola and one Board of Directors member sit on the board of Coca-Cola FEMSA, the largest bottling plant in Colombia.

She said the corporation owns 39.6 percent of FEMSA's stock.

Bahruth said it's virtually impossible for the violations to be proven due to the corporation's enormous control over the bottling plants, as well as the well-known corruption of the Colombian government, which for years has been run by the paramilitary.

"Allegations themselves indicate there is a problem," she said. "Regardless of whether they are true or not - something must be going on. People aren't risking their lives to come to America to tell us what's going on, if it didn't have some basis in fact."

But according to Blimling, Coca-Cola representatives said the bottling company that was accused of violating human rights was not FEMSA, but one of the smaller Colombian plants that Coca-Cola has little or no influence over.

Another issue of concern over the current contract is it has allowed Coca-Cola to form a University wide monopoly for an extended period of time.

Bahruth said this monopolization of the University is "branding" students.

"[Under] the current contract you can't serve anything but Coca-Cola products at any University event," Bahruth said. "It's so ingrained in the culture that the pep-squad response during sports events is, 'Coca-Cola is the real thing.' They do it as part of the culture of the University. They do it every game."

Blimling said the "exclusivity" of the contract does not actually limit students in their beverage choices.

"[The University] doesn't operate in a vacuum," Blimling said. "'Exclusivity' doesn't mean that people can't drink [other beverages]. You can go to any grocery store in New Brunswick and buy any beverage you want. We're not telling students what they have to drink."

He also said student concerns over the contract are a divided issue.

"[Some] students feel very passionately we should not have Coke as our provider," Blimling said. "[Other] students feel the University needs to make this a level-playing field and the only real criteria in the decision should be which company gives the most financial benefit to the institution, because our greatest need is to keep tuition [and] expenses to students low."

Kristen Gilmore, president of the Graduate Student Association Council 1 which was the only student governing association to pass a resolution against a renewed contract — said she believes the current beverage contract negotiations are too closed to students.

"[The committee] is deciding what students will drink for the next four years of their undergrad lives," Gilmore said. "This decision should be student driven, it is what we will drink for the next 10 or 20 years, depending on the contract length."

Currently, two undergraduate students and one graduate student are included on the Exclusive Beverage Contract Committee.

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