Friday, December 14, 2001

WILMINGTON, NC – Following a thorough review of three proposals for operation of the University Bookstore and consultation with members of the executive committee of the Board of Trustees, Chancellor James R. Leutze announced today that UNCW has decided to outsource bookstore operations to Barnes & Noble College Bookstores. While all the details of the contract and the transition have not been finalized, it is anticipated to be effective around the middle of spring semester 2002.

The decision to outsource bookstore operations is consistent with the recommendation of the Bookstore Selection Committee and the chancellor’s executive cabinet. The Bookstore Selection Committee, made up of three students, three faculty, and three staff members and chaired by the UNCW director of internal audit, evaluated proposals submitted by Barnes & Noble College Bookstores, follett Higher Education Group, and the UNCW University Bookstore.

Barnes & Noble was selected because its proposal assures the university a total revenue stream of $500,000 over five years in excess of both of the other two competing proposals. This revenue stream will assure the university’s ability to maintain or increase student scholarships and to moderate student fee increases needed to expand the University Union and student services buildings.

“Certainly, at a personal level, no one likes the idea of having to outsource university business operations and layoff current university employees -- some of whom have served the university for a number of years,” said Dick Scott, associate vice chancellor for business affairs who supervises a number of UNCW’s auxiliary enterprises.

“However, we need to keep in mind that the operation of a book store is an ‘unrelated business enterprise’ not directly linked to the university's academic mission. As such, and as a publicly funded institution, the university has an obligation to provide these services to its students, faculty, and staff in the most cost-effective manner possible. In the present instance -- as well as in our food services area – the university must subject its operations to the discipline of the private market place.

“Organizations such as ARAMARK in the food service industry and Barnes & Noble in the retail book sales industry have purchasing power and economies of scale that are simply not achievable in a smaller, in-house operation like the UNCW Bookstore,” Scott continued. He also noted that between 30 and 40 percent of college bookstores across the country are operated by contractors.

“This contract award was a financial issue and was not based on a quality of service issue,” he said. “It does not indicate any dissatisfaction with our employees, but is in response to our seeking a more financially viable way to run the bookstore especially in these tight budget times.”

The university began discussing privatizing bookstore operations early this year, after which a request for proposals was issued in September. The request for proposals contained a deadline of Dec. 20 for a decision to be made.

This action will impact 14 permanent UNCW Bookstore employees who will be separated from state employment under the Reduction in Force laws. However, under state and UNCW’s Reduction in Force Policy, these employees will receive these considerations:

Guaranteed employment by Barnes & Noble for 12 months at their current salary, contingent only on continued satisfactory performance.

Severance salary (or a discontinued service retirement allowance for certain individuals) which ranges from a minimum of two weeks salary up to a maximum of eight months salary -- payable in addition to the Barnes & Noble salary.

Continued coverage by the State Health Plan for 12 months at no cost for employee coverage and lifetime eligibility to participate in the State Health Plan at the employee’s own cost.

Priority Re-employment Consideration for 12 months from the date of RIF notification which provides priority in relation to all other applicants for positions at the same or lower salary grade for which the RIF candidate qualifies within UNC Wilmington -- or priority in relation to all non-state employee applicants for such vacancies among other state agencies.

Except for the Barnes & Noble guarantee of employment that was included as a UNCW contract stipulation, the other provisions are statutory under North Carolina law. “We feel that this is a reasonable package intended to provide an economic bridge to new state employment or succeeding private sector employment, and the university remains committed to working with each employee to help ensure a smooth transition,” commented Sam Connally, UNCW director of human resources.

Barnes & Noble College Bookstores is a privately held company, separate from the retail booksellers.

To contact Dick Scott, call 910/962-3151 (o) 910/791-3261 (h).