Determining where discretionary funds can be used is a dilemma that's seemingly as old as meal plans themselves. The questions of whether these funds can be used beyond the confines of campus is often down to university dining officials, food service providers, or some combination of the two.

That's the case at Pennsylvania's Shippensburg University, where students are questioning why their flex dollar spending is restricted to only on-campus purchases. But there likely won't be a change to that formula for some time as the university is simply honoring its current food-service contract.

Per a report from The Slate, Shippensburg is currently in the third year of a seven-year contract with food-service vendor Chartwells. As laid out in university's food-service contract, every dining location on campus is legally owned by the contractor, including franchises like Starbucks. Breaking the contract with Chartwells would, among other things, likely make keeping the franchises in place challenging.

Shippensburg's vice president of student affairs told the Slate that part of the food-service contract is prohibiting flex dollars from being spent off campus -- and for good reason. Of the many factors considered in the matter, keeping discretionary funds, or flex dollars, on campus enables a university to better guarantee students won't use the money to purchase liability-laden items like cigarettes or alcohol.

Even if the university allowed local businesses to accept flex dollars, there remains the issue of local merchants accepting the funds. University officials warn that business owners might not be interested as it would require the purchase of expensive POS equipment.

In the Slate report, Shippensburg's vice president for student affairs, Roger Serr, also suggests that if flex dollars were to be allowed to leave campus, then the university may have to remove some on-campus assets.

“Really the question is, 'What do we have to cut?’” Serr says. "What retail organizations do we need to remove to offset the loss of revenue from flex spending?"

As with any food-service contract, there is an end date at which point Shippensburg could choose to undergo an RFP process if the campus is interested in seeking other vendor partners. For now, however, it remains business as usual.

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