Danbury may renew school contract with Coca-Cola at lower rate

DANBURY, Oct 28, 2009 (The News-Times - McClatchy-Tribune Information Services via COMTEX) -- KO | Quote | Chart | News | PowerRating -- Local educators are considering renewing the district's contract with Coca-Cola Co., which gives the company exclusive rights to have its beverages sold on school grounds in exchange for a yearly fee of about $6,000.

It's a much smaller amount than in the original five-year contract signed in 2004, which was worth up to $25,000 a year. But that's when the schools were allowed to sell soda.

Now federal law limits what beverages can be sold in schools and Connecticut law is even stricter, limiting drink sales to a few selections, including water, 100 percent juice, and milk and nondairy milk products.

The Board of Education will review the contract at its meeting Wednesday, with a goal of signing the agreement at its next meeting, finance director Elio Longo said.

"It is not a lot of money, but this is the protocol that we must follow," Superintendent Sal Pascarella said Tuesday.

Danbury first signed a contract with Coca-Cola in 2004 that paid the school district about $140,000 over five years, as well as a one-time $10,000 fee.

"The original contract is totally different than this one," Paul Fitzgerald, district manager for Coca-Cola, said Tuesday. "All we are selling now is water and 100 percent juice. The original contract allowed for the sale of soda."

The state law that became effective July 1, 2004, permits schools to sell milk, nondairy milk like rice and soy milk, 100 percent fruit juice, vegetable juice or combination of such juices, and water.

The products are restricted in sugar and fat content and have no added sugars, sweeteners, artificial sweeteners or caffeine.

Except for water, the portion size cannot exceed 12 ounces.

The restrictions on beverages sold in schools led to a slip in sales for Coca-Cola. It means that only larger school districts, like Danbury, sell enough drinks to generate some income from Coca-Cola, Fitzgerald said.

The contract being proposed would run from Sept. 1 to Aug. 31, 2014. It gives Coca-Cola exclusive rights to sell or distribute beverages allowed by law at school, concessions and in vending machines.

It would prohibit any competing product to be sold, dispensed, sampled or served anywhere on school grounds unless it is in a product category not sold or marketed by the bottler.

In exchange, Coca-Cola will service the vending machines for free and give a rebate of $2 per case sold on all direct delivered or non-vended drinks, paid annually over the five-year term of the contract.

"It's not a lot, the $6,000, but it could be more. It's a conservative estimate," Fitzgerald said. "It's all based on sales."

Contact Eileen FitzGerald at eileenf@newstimes.com or at 203-731-3333.

Proposal to renew Coca-Cola Co. contract in Danbury public schools For Sept. 1, 2009 to Aug. 31, 2014 Terms: Exclusive right to sell or distribute beverages allowed by law at facility, at concessions and in vending machines. n No competing product may be sold, dispensed, sampled or served anywhere at the facility unless it is in a product category that is not sold or marketed by the bottler. n No permanent or temporary advertising signs for competing products are allowed. n Bottler provides free service to equipment. n Rebate fee: $2 per case of drinks sold on all direct delivered or non-vended cases sold over the five-year term will be paid annually to the school system, an estimated $6,000 a year.

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