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.
Schools are depending more and more on outside sources to fund programmes that used to be covered by government resources. In Toronto, fundraising in elementary schools increased 494% between 1998 and 2003, according to the Toronto Parent Network’s annual tracking report. In the report, TPN finds fundraising dollars being used for everything from textbooks and classroom supplies to fieldtrips and physical education equipment. Their conclusion is schools in rich, affluent neighbourhoods are able to give students a better education than those in impoverished neighbourhoods – a practice which is contrary to the spirit of a public education system.
To rectify this situation, school boards must eliminate contracts with soft drink providers and bring the delivery of beverages in schools back under the responsibility of the school board. This will give schools the opportunity to set their own standards for consumption as well as place juice and milk ahead of branded products. Further, it is vital that schools improve their delivery of the healthiest drink, water. In many older schools fountains provide drinking water that is discoloured or contains a curious taste due, primarily, to rusted pipes that in some cases date back decades. However if change will be made funding from senior government is a necessity because school boards have been placed between a rock and a hard place. On one hand school board trustees would like to remove corporate sponsorship and health risks from public education but on the other they cannot, with a conscience, eliminate any further dollars from an Ontario school system that has seen its funding stripped down to the bare bone. Additional provincial funding to replace every dollar spent in schools by soft drink companies must be allocated to allow the TDSB freedom from private sector investment. These dollars are especially important at this juncture because a new contract is in the process of being tendered that will render the TDSB discouragingly dependant for years to come.
For the system to continue to function in a manner that guarantees a high standard of universal education, corporate contracts must be handled with extreme caution. A corporation and a school board will rarely have mutual interest in the betterment of education. Companies are responsible to their shareholders and board members rather than school communities. In this case, a community is most concerned with maintaining its intimate role in governance of schools while the best choice for Coke is to have a life long customer.
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