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Selling chocolate almonds, magazine subscriptions or gift certificates is the tip of the iceberg when it comes to fundraising by public schools. The largest contribution comes in the form of centralized corporate contracts. First found in the United States, corporate contracts in education are partnerships between a company who provides a service to schools and a school board. The most common and visible examples of these contracts are computers, cafeteria food and vending machines.
Vending machine contracts regulating the sale of beverages (also known as pouring rights) have become a hot topic in many school districts throughout North America. Commonly held by Coca-Cola or Pepsi, these contracts give exclusive vending and advertising rights to a single company. The exclusive distribution rights generally include strict confidentiality clauses that prevent the details of these contracts from reaching the public, as well as incentive-based bonuses.
The Toronto District School Board (TDSB) is Canada’s largest school district, located in southern Ontario. Its contract with Coca-Cola was recently released for public viewing after the precedent setting case in the neighbouring York Region District School Board that featured a two year court battle waged by a 15-year-old student.
The contract at the TDSB features several worrying clauses, including incentive based bonuses worth up to $356,000 per year, commission on sales that are expected to total $5.2 million over the four year deal and a guaranteed $225,000 per year for exclusivity.
Incentive based rewards (like bonuses or commissions) are the most worrisome part of the contract because they encourage schools to put the well-being of their students aside while opening the doors for a company to pitch their product to students and ultimately brand them lifetime customers. According to Coke’s proposal, the TDSB’s contract would be worth in excess of $5.9 million (not including value-added perks such as free cases of beverages for school events). The money earned is desperately needed to fund such basic needs as classroom materials because Ontario’s schools are not being provided appropriate funding by the provincial government. This makes it extraordinarily difficult for the school board to say no to corporate contracts.
Although accepting money from Coca-Cola may come across as a reasonable means to cover a budget shortfall, it makes school boards dependant on corporate contracts. By creating this dependency, companies like Coke will find it easier to extort schools for more exposure to students, like in the curriculum. During the 1990s, Pepsi attempted to include an anti-drug plan laced with Pepsi logos in its contract with the TDSB (known as the Toronto Board of Education prior to amalgamation). At that time schools had more financial resources to work with and were able to reject such an offer. However what is clear is that the soft drink industry aspires to be included in school curriculum. Coke has included items like scholarships to students, branded promotional signs for school events, scoreboards and free beverages that can be distributed during school functions in many of its contracts throughout North America. Regardless of this ‘generosity,’ it is by no means an act of charity. The rewards Coke stands to gain far outweigh the $35,000 they offered the TDSB for event refreshments and the $5.9 million dollars pumped into Toronto public schools by potentially winning new customers. For Coke, this contract and every other one like it means thousands of students will become life-long consumers as they are lulled into the routine of purchasing Coke products repetitively over their childhood.
Repercussions of this leap in consumption are most notable in the obesity rate within people of all ages but especially children and youth. In the United States, health surveys completed by the North Carolina Health Action Committee show a 40.1% increase in obesity rates for children age five to 11 between 1995 and 2000. This corresponds to the 72% of children between age nine and 13 consuming soft drinks at least once per day. However, the most concerning age bracket is 12 to 19, when youth consume more than twice as much soda in comparison to juice and milk combined. On top of the advertising campaigns and accessibility to the products in school hallways, another factor is serving size. During the 1950’s, most soft drinks were served in 192ml servings, today however, we have leaped to 355ml and most recently the push has been to 600ml bottles. The difference between a 600ml bottle and a 192ml serving is 178 calories.
There clearly is a relationship between making soft drinks available in schools, consumption rates and the unhealthy lifestyle led by many youths. However, school boards in most cases refer contracts concerning pouring rights to their business relations departments instead of food services or a department that is concerned with healthy living. On principle this is questionable and in reality there is substantial cause for concern. In a food services or health department individuals with specific knowledge on nutrition are employed and are equipped to advance a mission statement that includes promoting health. However, in business relations the focus is on the bottom line. The consequence is agreeing to contracts that compromise the health of students.
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Adam Chaleff-Freudenthaler
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Comments
Ally | Apr 2nd, 2004
Thank you very much for posting this interesting article Mr Chaleff-Freudenthaler, it has been very informative.
Fundraising Gerry Cockburn | Jun 17th, 2004
Excellent article. As a school administrator, and have served on tendering committees, you absolutely right.
I, another business partner have had some success with Family Vacation Programs as means of raising funds. Here is the site: www.businesstobusinessnetwork.com
Gerry
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