Area restaurant officials could see more business from GW students next year when the University combines meal points and debit dollars in a new program called “Colonial Cash.”
The new payment plan will provide a wider variety of eating options but will force many students to purchase larger meal plans.
This range of options places Aramark, GW’s food-service provider, in direct competition with off-campus restaurants that accept Colonial Cash, including Au Bon Pain, TGI Friday’s and Pizza Italia. Steve Gibbs, district manager for Aramark, said the new plan presents the company with “a year of uncertainties.” The University contract with Aramark ends in June 2004.
Ben Lipetz, general manager of Au Bon Pain, which has accepted debit dollars for about three years, said the 2000 Penn cafe’s business would benefit from the system.
“As long as transactions are still done the same way, with the GW card, (Colonial Cash) sounds like a great idea,” Lipetz said. “We could certainly expect an increase in business.”
Cemal Altayhli, manager at the Little Cafe, a takeout restaurant in Georgetown, said about 25 percent of its business is from students.
“We do accept a lot of (debit dollars),” Altayhli said, noting the restaurant has participated in the program for almost three years.
GW is pursuing several new off-campus partners to participate in the Colonial Cash arrangement, said Michael Peller, managing director of Business Services. He declined to name specific places.
“(We want to) keep satisfying student need,” Peller said.
Debbie Wright, GWorld card program director, said businesses become part of the Colonial Cash program after officials approach management or the business notifies the GWorld office they are interested in participating.
Each business individually negotiates a contract with the University, paying a service fee for subscription to the program, much like a Visa or Mastercard service charge.
Currently, about 70 businesses on and off campus participate in the program.
“We get information from potential merchants in a variety of ways; some of it is students’ (requests),” Wright said. “We evaluate different factors. Obviously, it has to be a mutual decision.”
The 7-Eleven convenience store on 24th Street decided to join the Colonial Cash program after a GW representative approached the store a couple of months ago.
“Over 20,000 staff and students have (GWorld) cards. It gives them another option,” said Sam Motamedi, the manager of 7-Eleven, who is also a student at GW. “It’s a matter of convenience.”
While the store is not currently accepting GWorld debit dollars, Motamedi said the national 7-Eleven company approved the venture and is currently in negotiations with GW over the specifics of the contract.
“It’s going to happen,” Motamedi said. “We are getting very, very close.”
A GW Deli manager, who wished to remain anonymous, said the G Street restaurant is considering joining the program if it will please students.
While GW receives a fee from off-campus restaurants or stores, Aramark, GW’s food-service provider, profits from all meal points spent on campus, Peller said. The University collects a “fixed commission” on its revenue from points.
Some officials said the new payment plan will force Aramark to compete with off-campus restaurants, which will be more readily accessible to students with Colonial Cash.
However, Aramark District Manager Steve Gibbs described the new situation as “business as usual,” saying Aramark would simply have to continue to market itself according to student demand.
“We don’t know what the impact (of Colonial Cash) will be, but as the year unfolds, we’ll get a better idea,” Gibbs said.
Formal negotiations for a new contract between GW and Aramark have not begun, though there has been speculation about whether or not the relationship between the two would extend past 2004.
Peller said the University is reviewing its options for on-campus dining services.
“I don’t know at this time,” Peller said about whether GW would continue to do business with Aramark. “The University is going to have to negotiate a contract with a food service provider. With a whole new contract, anything could happen.”
“Aramark and GW have been partners for seven years now,” Gibbs said. “We would obviously like to see that partnership continue in the future.”
Currently in negotiations are three new vendors for the 1957 E St. building. Peller said the University hopes to attract venues that will “add another dimension” to campus dining options.
The new meal plan will be required for all students living on campus, while a separate debit dollars account will be available for commuting students.
Freshmen will be required to purchase $3,000 in Colonial Cash each year, while sophomores will put $2,500 on their GWorld cards, juniors $2,000 and seniors $1,000, marking a slight increase from prior years.
“The prices are a little higher than last year,” Peller said. “But Colonial Cash gives students an enormous amount of flexibility with where they spend their points.”
Food purchased on campus with Colonial Cash will be tax exempt like meal points, in accordance with a federal law which states university food venues cannot tax purchases. Off-campus venues can still tax Colonial Cash purchases. Students will also be able to use Colonial Cash for laundry and at the library.
“My hope is that we will see an overall increase in service (with Colonial Cash),” he said.
-Kate Stepan contributed to this report.