Tuesday June 1, 2010 year: 130 No. 116 the student voice of
The Ohio State University
www.thelantern.com
thelantern
Coke money kept secret Custom-made arts & life
seats at Arts Space
7A
campus
Farmer’s market at Wexner
2A
sports
Ohio State’s Coke contract: Questions without answers
JACK MOORE Lantern reporter moore.1732@osu.edu
Coca-Cola’s formula for its sugary sweet soda is under lock and key, guarded by Coke as a trade secret. Now, Ohio State and Coke say that parts of the exclusive contract between the beverage giant and OSU, which was renewed in 2008, are also trade secrets and should be kept from public view, even though contracts at comparable universities are not. OSU’s current contract is worth at least $33.95 million, said Jim Lynch, director of Media Relations. Payments made to OSU from Coke come from royalty fees and vending commissions on Coke products sold on campus. In exchange, Coke receives the exclusive right to sell its products on campus as well as sponsorship opportunities and the ability to use OSU trademarks in Coca-Cola advertising. Speciÿc numbers beyond that are unknown because OSU and Coke contend that they are trade secrets. On April 27, The Lantern requested copies of both the 2008 contract and the 1998 contract. Nearly all dollar amounts in both of the contracts provided were blacked out. At the time the contracts were provided, Lynch said in an e-mail that those numbers fall under the scope of trade secrets and were exempt from Ohio’s public records laws. Under Ohio law, information qualiÿes as a trade secret if it “derives independent economic value, actual or potential, from not being generally known to … other persons who can obtain economic value from its disclosure or use.” The actual ÿgures for royalty fees and vending commissions could be used by Coke’s competitors to “undercut them in contracts and renewals,” Lynch said in an e-mail on May 11. Other schools could demand the same kind of deal as OSU even though they wouldn’t “bring the same name recognition and market size to the table,” he added. Fred Gittes, a Columbus attorney who specializes in First Amendment issues, is skeptical of OSU’s claims of secrecy.
Ohio State renewed its 10–year, nearly $34 million contract with Coca-Cola in 2008. After The Lantern requested a copy of the contract on April 27, OSU provided a copy with nearly all dollar amounts blacked out. Questions about the contract and how funds are distributed have led to even more questions and few answers.
The contract Question: How much is the contract worth? How is money generated? Response: The contract is worth at least $33.95 million, said Jim Lynch, director of Media Relations. OSU and Coke contend that specific numbers for how revenue is generated through royalty fees and vending commissions are trade secrets and should be kept from public view. “In regards to the annual revenues from Coca Cola funds, that is the information that is contained in the redacted agreement,” Lynch said in an e-mail.
Distributing funds
In July 2009, the Senior Management Council, made up of top-level administrators who report to the president, approved a $10 million allocation to help pay for construction of the new Ohio Union, along with distributions to other departments.
Question: With the $10 million distribution, how did the council shift money from the previous contract? How did the council decide on $10 million? Response: Bill Shkurti, longtime chief financial officer and one of the key decision-makers on the council has since retired. “Given the fact that Bill Shkurti has retired, it is difficult to arrange an interview with someone who has the institutional knowledge that Bill had,” Lynch said in an e-mail. Provost Joe Alutto, head of the Office of Academic Affairs who also sits on the council, has not responded to repeated requests for an interview.
Vending commissions
According to financial documents, the university did not earn expected vending commissions in 2009, presumably because Coke didn’t sell as many of its products as was anticipated.
Question: What was the amount of expected vending commissions? How much did OSU actually earn in 2009 from vending? How much did OSU earn from vending in previous years of both contracts? Response: Questions directed toward the Department of Purchasing were redirected to Lynch. Lynch said while OSU did not earn expected vending commissions last year, the university “did receive all of the funding we were expecting…under the terms of the contract,” because of guaranteed Coke vending payments. Lynch also said questions about revenue earned from vending commissions were trade secrets. “In regards to the vending commissions, our contract has a confidentiality clause which makes it difficult to share that data,” he said in an e-mail.
continued as Coke on 3A
MOLLY GRAY / Lantern designer
‘How firm thy friendship’ 40 years later LAUREN HALLOW Lantern reporter hallow.1@osu.edu Forty years ago, ÿve students made a pact to meet every ÿve years at the William Thompson statue in front of the William Oxley Thompson Library every ÿve years on May 31 at noon. Eight reunions, numerous “sick” days from work, thousands of travel miles and one induced labor later, the ÿve friends continue to meet each May and have no plans to discontinue the tradition. “It’s so easy to see someone and go up to them and say, ‘Oh it’s so nice to see you. We’ll have to do this again sometime,’ and walk away, never to see them again,” Judy Hennen said. “But if you have a Woods returns to Dublin’s Muirfield Village Golf Club as the speciÿc date, a speciÿc time, and you defending champion and the event’s only four-time winner. all write it down … and if you make the commitment, people are more likely to remember it and live up to it.” Hennen, Loretta McCollum, Mark Lott, Terry Morrison and Jim Arter are ÿve friends that met at Ohio State in the
Tiger Woods
1B
The Lantern needs student columnists.
E-mail binkley.44@osu.edu to share your student voice.
70s and wanted to keep their friendship alive once everyone went their separate ways after graduation. When the oldest, Morrison, was gearing up to graduate, the ÿve got together toward the end of Spring Quarter in 1970 to plan a reunion. Arter, a movie buff, decided to make a pact because that’s how they “do things in the movies.” The group picked a date (May 31), a time (noon) and a popular place on campus (in front of Thompson Library at the statue). They decided ÿve years was a reasonable interval to meet, and everyone was ready to sign the pact — except Lott. “I knew I was going to move far away and that it would be difÿcult to get back,” said Lott, who has lived in Los Angeles for the past 35 years. Then Arter jumped in. “Yeah, Marc told us, ‘Well I’m going to move away and make something of myself and not be dumb-dumbs like you who are going to stay in Columbus and can just take the COTA bus on over’ (to these reunions).”
continued as 40 on 3A
From left to right: Judy Hennen, Mark Lott, Terry Morrison, Jim Arter and Loretta McCollum do OH-IO 40 years after attending OSU together.
OSU Airport rolls out scarlet carpet for Columbus City schools BEN BROWN Lantern reporter brown.2959@osu.edu
weather high 85 low 63 am showers
WE 89/70 t-storms TH 82/63 t-storms FR 79/63 partly cloudy SA 84/68 t-storms BEN BROWN / Lantern photographer
www.weather.com
Photo courtesy of John McCollum
Javon Morgan and D-shawn Strickland, eighth-graders from Champion Middle School in Columbus, are instructed by flight student Alan Kelpe.
Middle school students toured the Ohio State University Airport on Friday as part of a project to encourage disadvantaged youth to go to college. “Even though they live within a mile of campus, many students have never even been there,” said Edwin England, an employee of Educational Service Center of Central Ohio. “The ÿeld trip was a reward for students whose attendance has improved dramatically from their involvement with Project KEY.” Project KEY, an acronym for Keep Engaging Youth, is a truancy intervention project that joins Columbus City Schools with the university. Friday was Scarlet Carpet Day, which allows students underrepresented in college demographics to “be a Buckeye for a day and get a college experience,” England said.
Students earned the ÿeld trip via two 30-day stretches of no unexcused absences from school, said Jeff McCreary, Project KEY advocate at Columbus’ Champion Middle School. Of the 70 students involved with the project at Champion, 18 qualiÿed for Scarlet Carpet Day. Students from Indianola Middle School and Eastmoor Middle School also participated Friday. “The airport is a valuable tool to get kids excited about college,” said Cecilia Lammers, communication assistant for the University Airport. “Even if they’re bored in the beginning, they’re interested by the end.” At the airport, students got lessons in aerodynamics and aircraft maintenance before visiting the observation tower and sitting in ° ight-education planes. The OSU Airport is one of the only university-owned-andoperated airports in the country. It gives tours to more than 2,000
continued as Airport on 3A 1A