PSU makes guaranteed revenue from Sodexho

Portland State has made over $400,000 in the first 20 months of its contract with food service provider Sodexho. The contract with Sodexho will end on June 30.

Portland State decided on March 2 to end its food service contract with Sodexho because of overpriced food and service mistakes. The French-owned multinational food service giant completed two years of a seven-year contract.

Portland State’s auxiliary services department is making arrangements with Aramark, a multinational Philadelphia-based company, to take over dining operations on July 1.

Aramark provided the service from 1999 to 2005, and came in second place to Sodexho in 2005 when the companies bid for the contract. The Aramark bid is still valid, according to Chip Lazenby, Portland State’s general counsel.

“Having a low price point is one of the things I know Aramark is being asked to include,” Lazenby said on Friday.

Over the last two years of the contract with Sodexho, the company paid PSU a cut from its earnings in retail operations, catering and University Place. PSU earned $247,340 during the 2005-06 fiscal year and $168,878 so far this year, with four months remaining on the contract.

Sodexho guaranteed a minimum of $200,000 in revenue to Portland State each year.

According to the contract, Sodexho paid the university 8 percent on the first $5 million from retail sales. The percentage would have increased to 9 percent if sales exceeded that amount, and would then jump to 10 percent of profits above $7 million. Catering sales paid 8 percent of profits up to $1.4 million.

The contract states that the percentage paid to the university would start at 8 percent on the first $5 million in sales and would cap at 10 percent if sales exceeded $7 million.

Two years ago, when Aramark’s six-year contract with the university ended, it and two other companies bid on providing the service. For this service, PSU is required to seek competitive bids, said Dee Wendler, the PSU associate vice president for finance and controller.

“One of the things we have to do is provide a food service to students and staff,” Wendler said. Because of the essential nature of this contract, Wendler and Lazenby determined that a new request for proposal, or bidding process, was not necessary with Sodexho’s departure.

When Sodexho was chosen to take over the contract, student input was a part of the decision-making process, said Carol Martin, outreach coordinator for auxiliary services, which oversees the food service operations.

“Choosing Sodexho was a student choice,” Martin said. “I know there was student input.”

Martin said that Sodexho included an extensive plan for how it would incorporate sustainability into its practices on campus, which impressed students.

Julie North, director of auxiliary services, said that although students will not be a part of the decision-making process this time, Aramark will hear student ideas.

“We’re going to organize several different types of focus groups to meet with Aramark,” North said. “Students will be able to tell us what they’d like to change and how they envision food service on campus. We won’t leave anyone out.”

John Lambert, one of the student organizers at the student-run co-op Food for Thought Caf퀌�, expressed disappointment that other options were not being considered.

“This seems outrageously undemocratic,” Lambert said. “We should be able to choose what we eat on campus.”

Lambert said that other campuses have students participate more fully in bringing food to their communities.

“If the administration was to work with us to provide some portion of the service, that would be great,” he said. “We are already established and we could grow from that base.”

Aramark has about 240,000 employees in 17 countries, while Sodexho has close to 325,000 employees worldwide.