Coca-Cola questions contract
■ The company says it
may have bid differently if
it, like Pepsi, had been
offered a 12-year deal.
By Erin Gibson
Senior Reporter
The university did not give the
Coca-Cola Co. the option of bidding
on a 12-year beverage contract, a
Loca-Cola spokesman said Tuesday.
Allen Baird, Coca-Cola sales cen
ter manager in Lincoln, said the uni
versity asked his company to bid on a
10-year contract.
But the Pepsi Cola Co. and its bot
tler, LinPepCo, signed a 12-year con
tract this summer to pay the
University of Nebraska-Lincoln more
than $24.2 million in exchange for an
exclusive right to sell soft drinks on
campus beginning July 1.
The opportunity to bid on an addi
tional two years “could have made a
difference in (Coca-Cola’s) propos
~ 1 » r* •_i_: j un.-i. __
ai, uaiiu ^aiu. uui mai wasii i an
option.”
Under state law, the university
must take bids on any major construc
tion or service contract before a con
tract is awarded.
Melvin Jones, UNL vice chancel
lor for business and finance, said
Pepsi was given an additional two
years because Coca-Cola holds a con
tract with the Athletic Department
through June 30, 1999.
Pepsi wanted to provide bever
ages and advertise for 10 years in
Memorial Stadium.
“Pepsi wants to make an impres
sion,” Jones said. “It was felt that they
should be given an additional two
years so that they would have a pres
ence in that stadium.”
Coca-Cola signed a contract with
the Athletic Department in June 1994,
he said. Under the contract, Coca
Cola chose in 1997 whether to contin
ue to the contract through June 1999,
and the university must honor Coca
Cola’s decision.
“We asked them not to exercise
their option,” Jones said, but Coca
Cola chose to continue the beverage
contract with athletics through 1999.
■
irs a Deal
On July 1,1997, Pepsi Cola Co. began paying
the university more than $24.2 million over 12
years in exchage for an exclusive contract to sell
beverages on campus. Below is a list of what
both the university and Pepsi receive from this
alliance.
What Papal pets: (Effective July 1,1999)
20 tickets to each university home athletic game
Eight tickets to each Big 12 tournament
Eight tickets to each football bowl game the university participates in
Eight tickets to one football away aame, including transportation
License to use and reproduce UNL trade and service marks in print, radio, TV
and Internet promotion of Pepsi's beverage products
Display its logo on two Husker Vision panels in Memorial Stadium and on three
scoreboards
Have its logo appear during eight Husker Vision replays
Have its logo on the score table at the Bob Devaney Sports Center and on two
panels on clocks in the Sports Center
What the iilverslty pet*
$1 million a year for 12 years
$11 million quasi-endowment to the University of Nebraska Foundation
$100,000 a year for 12 years to NU athletics «
$100,000 a year, estimated share of vending machine profit
Source: LinPepCo contract
Jones said Pepsi was awarded the
contract because its product
Mountain Dew was the top-selling
soft drink on campus last year, and
Pepsi offered the university the most
money.
“Based on my knowledge of other
financial packages proposed by the
leading soft-drink makers to other
institutions, this is by far the biggest
ever offered for a campus of our size,”
Jones said in June.
Pepsi will pay the university a $ 1
luuiiv/ii uvviumg ivv vuvii j vui iui 1
years under the contract and will pay
an additional $100,000 annually to
the Athletic Department.
Pepsi became an official sponsor
of the department this summer
although athletics’ contract with
Coca-Cola has yet to expire.
Pepsi also paid $11 million this
summer to the University of
Nebraska Foundation to support aca
demic and student programs.
Theresa Klein, foundation
spokeswoman, said the $11 million
was invested this July as a quasi
endowment, which means the foun
dation will spend only the net income
gained by the account’s $ 11 million
principle.
About $550,000 will accrue each
Aaron Steckelberg/DN
year, Klein said. The foundation will
not withdraw the account principle,
although the contract allows it to
withdraw some of the $ 11 million to
fund major university projects.
Sandy Watmore, the university’s
liaison to Pepsi for vending services,
said the university will also receive 55
percent of all profits made in about
100 pop vending machines around
campus once sales top $800,000.
Last year, about 3> l .zb million was
spent in campus vending machines,
she said. So the university could make
an additional $140,000 each year.
The university made $207,000 in
profits from vending machine sales
last year, Watmore said. Those profits
were distributed among several
groups on campus, including student
organizations, the Nebraska Unions,
housing and food service, university
libraries and athletics.
Jones said those departments
would continue to receive funding
from the $ 1.1 million Pepsi will give
the university annually.
A committee will decide which
other university programs and areas
should receive funding, he said.
Curt Ruwe, president of the
Please see BEVERAGE on 14
OPEN BAR:
24 Hours, 7 Days a Week!
• Fitness classes included in membership • Conveniently located 5 minutes from campus
• OPEN 24 HOURS, 7 DAYS A WEEK • Student Membership Packages Available
Call today and schedule your tour of the Cottonwood Club.
O Lincoln's leader in health and fitness.
COTTONWOOD 475-3386
CLUB
---—
<
“Has your cushy summer office job left you without your usual gorgeous summer
tan? Too busy getting ready for school to make any appointments?"
MAX TAN has the perfect solution for you! At MAX TAN you can
revive your bronze appearance and never have to make an appointment!
MAX TAN North MAX TAN South
West “O” 40th & Old Cheney
477-7444 g 420-6454
ONE FREE TAN! Iu"‘' ' j
Good At Either MAX TAN Location. NO APPOINTMENT NECESSARY! |
Expires 8/31/97
UNL orders Coke
to increase prices
By Erin Gibson
Senior Reporter
The University of Nebraska
Lincoln demanded Tuesday that
Coca-Cola Co. raise the price of soft
drinks in its vending machines in
NU Athletic Department facilities
to match the price of other campus
vending machines.
Allen Baird, Coca-Cola sales
center manager, said Heidi Cuca,
athletic marketing director, asked
him to raise the price of a 12-ounce
soft drink from 35 cents to 50 cents,
the price Pepsi Cola Co. charges for
12-ounce soft drinks on campus.
“They don’t want us to look as if
we’re the good guys,” Baird said.
Cuca said she placed the call on
behalf of James Main, assistant vice
chancellor for business and finance.
Main was unavailable for comment.
Baird and Cuca said they were
unsure whether Coca-Cola must
_1_*1.1. ii . • . i
cumpiy wiui uic umvcisuy s uajucsi
to change prices.
The Athletic Department’s five
year beverage contract with Coca
Cola Co. didn’t expire when the uni
versity and Pepsi Cola Co. signed a
12-year contract worth more than
$24 million this summer.
Coca-Cola operates four vend
ing machines in Athletic
Department buildings and plans to
install two more machines under
neath the west side of Memorial
Stadium, Baird said.
Vending machines are now at
Buck Beltzer Field and in the
Hewitt Center, he said. Coca-Cola
also operates about 26 fountain
units in Memorial Stadium and the
Bob Devaney Sports Center.
The Coca-Cola contract, signed
in July 1994, expires on June 30,
1999. Under that agreement, Coca
Cola provides all beverages at on
campus Athletic Department
events, including those held at Buck
Beltzer Field, Memorial Stadium
and the Bob Devaney Sports Center,
Baird said.
Carl Hutchison, special projects
buyer in UNL’s purchasing office,
said he first contacted the Athletic
Department on behalf of Main’s
office through Gary Fouraker, asso
ciate athletic director for business
affairs, and asked him to raise prices
in the Coca-Cola vending
machines.
Hutchison said he made the
request because the standard price
for a 12-ounce soft drink on campus
is 50 cents and he didn’t “want to
play favorites” with vending
machine prices.
Pepsi did not ask for the price
increase, and there is nothing in the
Pepsi contract that would require
competitors’ machines to charge
similar prices for soft drinks, he
said.
The Athletic Department’s
vending machines historically have
charged less for soft drinks, but the
university did not ask Coca-Cola to
change the price of soft drinks in
those machines before the Pepsi
contract was signed, Hutchison
said.
“But we’ve never been in this
situation before either,” Hutchison
said.
Pepsi became an Athletic
Department sponsor July 1 and
agreed to pay $100,000 annually to
the department through June 30,
2009.
Pepsi will provide all beverages
and vending services at athletic
Please see COKE on 8
Union lounge to reopen
before semester begins
By Terra Chapek
Staff Reporter
After a summer of plywood tunnels
and a missing lounge, Nebraska Union
this fall will offer students about the
same services it did in the spring.
Larry Blake, project manager, said
the main lounge, which was sealed off
during the summer, will be opened and
refurnished before classes begin. A
smaller dining area will also be available
to students, he said.
Parts of the lounge and dining area
will close periodically throughout the
fall, said Daryl Swanson, Nebraska
Union director.
Swanson said students will be with
out the north restrooms until the middle
of October. The new restrooms are
expected to be completed by the third
home football game, he said.
The restrooms are being slightly
relocated and enlarged.
To enter the restrooms, students
will walk around a wall instead of using
a door, like the restrooms in airports,
Swanson said.
During reconstruction, the women’s
lounge and the second-floor restrooms
will be open.
The 24-hour computer lab, formerly
on the main floor, is being relocated to
the first floor of Lyman Hall until con
struction is complete, Swanson said. The
temporary lab will be open 24 hours.
Swanson said the union has lost
many of its meeting rooms. Two of the
union’s main meeting rooms, the
Regency Room and the Heritage Room,
are under construction. The ballroom
will also be unavailable. Union adminis
tration and Student Involvement offices
are being housed in the ballroom and
will remain there throughout the year.
Although space will be sparse,
Swanson advised clubs or organizations
seeking meeting space to try making
reservations at the union.
Blake said heating and cooling the
union had been another concern. But he
said the union has not lost any air condi
tioning, and he expects the cooling sys
tems to be working until September. He
said tearing shouldn’t be a problem.
Blake said students will see most of
the changes outside the building. The
new addition’s steel skeleton is almost
completed, Blake said. A retaining wall
and the beginning of an outdoor water
feature in the plaza area also will be vis
ible in early fall.
Swanson said the union construc
tion is on schedule and that fall con
struction will concentrate on the inside
of the building.
“Aug. 1, 1998, still seems to be a
realistic timeline (for completion),”
Swanson said.
The fall construction will concentrate
on the inside of the building, Blake said.