State takes on Capitol coffee shop

Posted: Monday, January 24, 2000

Selling coffee to people who spend their days in meetings would seem an obvious money-maker.

But it hasn't turned out that way at the state Capitol.

A state employee has been hired to run the second-floor espresso stand at the Capitol after a string of contractors over several years couldn't make enough money doing it.

``The revenue was just minimal,'' said Helen Eckman, project coordinator for the state's Business Enterprise Program, which deals with food and beverage service operations in state and federal buildings. ``You would think it would be more than it is, but it's just not.''

The state Legislative Affairs Agency is taking on the job itself this year, and will have to pay 10 percent of gross revenues to the Business Enterprise Program, said Sen. Tim Kelly, chairman of the Senate Rules Committee.

``We anticipate that it will at least break even and not cost us anything in the final analysis,'' said Kelly, an Anchorage Republican.

Sen. Jerry Ward, who has pushed for more privatization of government services, is annoyed at the move in the opposite direction.

``The state of Alaska right now has approximately a $500 million deficit, and for us to be funding saunas and lattes for legislators and lobbyists is completely out of line,'' the Anchorage Republican said, referring to a legislative sauna in the new Terry Miller Legislative Office Building.

The Capitol coffee stand was never a typical private-sector operation.

State and federal laws require coffee stands, vending machines and similar food service operations in state and federal buildings be operated for the benefit of the blind, and in Alaska, other severely disabled people.

That's why the state's Business Enterprise Program got involved, Eckman said.

Those with disabilities can benefit from the operations in one of two ways.

They can run the shops themselves. Or the operations can be run by nondisabled contractors, who return a percentage of the revenues to the Business Enterprise Program.

That requirement is one reason the program is able to pay for itself, Eckman said.

``It's not a drain on the taxpayer,'' she said. ``We don't go to the Legislature for funding.''

In some buildings espresso stands are money-makers. But it hasn't worked at the Capitol, ``possibly because there are still a lot of coffee pots around in offices,'' Eckman said. ``It's not espresso, but it's free.''

Usually, if an operation is too small to make money, the Business Enterprise Program simply puts in vending machines, and those do make money.

But the Legislature didn't like that idea, Kelly said.

``Basically, it was a service we had established . . . for the public. It was popular,'' he said.

The coffee stand is not necessarily for the benefit of legislators, who have coffee in their offices, he added.

The Business Enterprise Program told legislators they could keep the operation open themselves, but they'd have to play by the rules and pay 10 percent of the gross to the Business Enterprise Program.

Kelly believes the shop can break even, despite that requirement.

At any rate, Kelly figures the espresso stand will be cheaper than what the Legislature used to do - put coffee out in the halls where people could drink for free.

``It got to be very expensive.''



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