The University of Kentucky is accepting bids to operate its dining services, but bring some cash: The request for proposals released Thursday by UK requires any new vendor to spend $25 million to $50 million on new facilities.
The vendor also would have to keep all current UK employees at their existing pay levels, and lay out a plan to expand UK's spending on local and Kentucky Proud products, which stands at nearly $1.8 million a year.
"The decision has not yet been made to outsource," said Bill Harris, UK's purchasing director. "That decision cannot be made until we see what they offer ... we're using this RFP as a basis to decide whether to do the outsourcing."
A driving impetus for possibly replacing UK Dining Services, which has an annual budget of $23.7 million, is UK's plan to build enough dorms to raise the number of students on campus from 5,100 to 9,000. However, new dining facilities were not part of the university's deal with the private development company that is building the dorms.
UK is requesting at least five new dining facilities and asks for renovations of existing ones.
The vendor also would provide meals at all of UK's existing dining locations, including at franchises such as Starbucks and Chick-fil-A, and take over catering services. Vendors also have the option of bidding to include concessions for athletics and UK HealthCare, both of which are already outsourced to private companies.
A campus debate over dining services has been ongoing for nearly a year, which resulted in significant contributions to UK's request to vendors, Harris said. Among those contributions was a requirement to keep UK's employees, and the emphasis on purchasing local products.
"I think we benefitted by the forums, we got an understanding of what people are interested in from a dining perspective," Harris said. "We also heard from faculty about the importance of incorporating academics, and the university's responsibilities as a land-grant school."
The university would require a new partner to continue UK Dining's many partnerships with the newly renamed College of Agriculture, Food and Environment, such as the Butcher Shop, which teaches students the process of butchering, preparing and selling cured and smoked meat products.
UK Dining also works with departments such as Hospitality Management and Nutrition and Food Science.
Lee Meyer, a professor in the department of Agricultural Economics, served on the initial Dining Services Revitalization Committee, and will be part of the bid evaluation team, along with other faculty, staff and students.
He said UK's request included the elements sought by the committee.
"I think it's going to be a challenge to see how companies respond to it," he said, adding that it will be important to carefully scrutinize how companies would make a profit.
"Some companies are very good at managing this business and will be able to generate profits for themselves and make a sizable contribution," Meyer said. "The question is how do they do that subject to all the constraints in the RFP?"
Sodexo, a multinational food service company started in France, provides dining services to both the University of Louisville and Berea College.
According to documents obtained from U of L, Sodexo's contract required them to spend $6.7 million on dining facilities between 2008 and 2010, with an additional $450,000 a year through 2018.
In addition, Sodexo lists "local food purchases" of about $665,137 for the 2012-13 academic year. About 11 percent of that was spent with Creation Gardens, a produce company that uses some but not all local farm produce. A total of 4.5 percent was spent on Heine Brothers' Coffee, a Louisville coffee company. About 3 percent was spent at Klosterman Baking Company of Cincinnati.
According to the documents, the definition of local is "items grown, produced or processed within a 250-mile radius of Louisville."
Because definitions on local food can differ, UK's request is very specific, Harris said, asking vendors to describe how they would expand UK's spending of $800,000 on produce from Fayette or surrounding counties, and $1 million on Kentucky Proud products. The request also requires inclusion of organic foods.
UK officials expect plenty more discussion. A community forum is planned for 6-7:30 p.m. on Sept. 18 in the William T. Young Library Auditorium.
The evaluation committee will review responses from potential business partners and create a short list for more formal presentations. President Eli Capilouto will make the final decision on whether the university should outsource its food services.
In a news release on Thursday, UK Student Government President Roshan Palli noted the importance of dining services to student life.
"They can make a real impact on the college experience for thousands of students," Palli said. "For this reason, it is important that we consistently strive for improvement through innovation and conversation."
According to the University of Kentucky's request for proposals, any new dining services vendor would be expected to build the following new facilities:
■ A dining area at Haggin Hall, available in summer 2014, to replace the old K-Lair;
■ A North Campus location to replace Blazer Café in summer 2016;
■ A replacement for dining facilities in UK's Student Center;
■ A dining area in a proposed student center satellite to be built near W.T. Young Library, possibly by 2016;
■ A replacement for the Commons, near the Kirwan-Blanding complex, at a yet-to-be determined date;
■ A dining area at the Gatton College of Business, which is being expanded and should open in 2015.