BILL ANALYSIS
SB 388
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Date of Hearing: July 7, 2009
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Anthony Portantino, Chair
SB 388 (Calderon) - As Amended: June 29, 2009
SENATE VOTE : 31-5
SUBJECT : Education materials.
SUMMARY : Establishes the Accountability in College Textbook
Publishing Practices Act (Act). Specifically, this bill :
1)Establishes legislative intent regarding the importance of
student access to affordable course materials, the role of
faculty in ensuring affordable access to materials, the
importance of innovation in the development and use of course
materials such as open educational resources, and the need to
strengthen and enforce existing federal regulations.
2)Establishes various definitions for the terms used in the
bill.
3)Requires textbook publishers who provide a faculty member with
information regarding a college textbook or supplemental
material to also disclose whether the college textbook or
supplemental material is available in any other format,
including paperback or unbound, and the corresponding price.
4)Requires textbook publishers, if they provide a faculty member
with the price of a textbook or supplemental material, to do
all of the following:
a) Make the price available on the publisher's Internet
website.
b) Charge no more than the price listed on the publisher's
website on the date that the campus order is received.
c) If after a price is provided, but before an order is
placed, the publisher changes the price of a college
textbook or supplemental material, the publisher must make
the amount of the change in price, whether the price was
increased or decreased, and the date the price was changed
available on their web site.
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5)Requires textbook publishers that sell bundled course
materials to make the college textbook and supplemental
material available unbundled and at separate prices.
6)Provides that if a faculty member or entity in charge of
selecting course materials requests a custom textbook or
bundle, the publisher is required to provide, in writing,
prior to accepting the order, the price of the custom textbook
or bundle.
7)Prohibits a campus bookstore from selling textbooks or
supplemental materials for more than 20% above the publisher's
price.
8)Provides that any publisher or campus bookstore that violates
any of the aforementioned may be enjoined by any superior
court of competent jurisdiction upon action for an injunction.
9)Provides that all of the aforementioned shall become operative
on July 1, 2010.
EXISTING LAW requires textbook publishers, for textbooks
published on or after January 1, 2010, to print a summary of the
substantive content differences between the new edition and any
prior edition, as well as the copyright date of the previous
edition. Existing law also requires the Board of Trustees of
the California State University (CSU), the Board of Governors of
the California Community Colleges (CCC), and requests the Board
of Regents of the University of California (UC) to work with
academic senates to encourage faculty to consider cost friendly
practices in assigning textbooks, to disclose to students how
the new editions of textbooks differ from previous editions and
the cost of the selected textbooks, to review procedures for
faculty to inform college and university bookstores to textbook
selections, and to encourage faculty to work closely with
publishers and college and university bookstores in creating
economically sound bundles and packages.
FISCAL EFFECT : Unknown
COMMENTS : Purpose of this bill : The author notes that recent
surveys by UC, the California Student Public Interest Research
Group (CALPIRG), and the Oregon Student Public Interest Research
Group (OSPIRG) show that a student now pays an average of $900 a
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year for textbooks. CALPIRG recently found that 77% of faculty
reported publishers rarely or never provide the price of a book
during sales interactions. CALPIRG also reported that
approximately half of all textbooks are only provided in more
expensive "bundles," while two-thirds (65%) of professors
reported they "rarely" or "never" use the supplemental items in
the bundled materials.
Background on Federal Law : Several of the provisions contained
in this bill have recently been addressed by federal law. New
amendments to the Higher Education Opportunity Act, adopted in
August of 2008, require publishers to disclose textbook pricing
information, unbundled textbook options, and other related
information to faculty at institutions of higher education
receiving financial assistance from the federal government.
Shared responsibility : In 2008, the California State Auditor
(Auditor) released a report entitled "Affordability of College
Textbooks," which identified publishers, campus bookstores, and
faculty members as responsible parties needing to work together
to reduce costs and properly disclose textbook information to
students. The Auditor's comments were echoed by Governor
Schwarzenegger in a veto message of SB 832 (Corbett) of 2007,
which would have required textbook publishers to provide
prospective purchasers at public and private postsecondary
institutions with specific information. In his veto message,
Governor Schwarzenegger stated that the bill focused strictly on
textbook publisher policies and failed to recognize that the
affordability of textbooks is a shared responsibility among
publishers, college bookstores, and faculty members.
Limiting campus bookstore markups : As noted above, this bill
prohibits a campus bookstore from charging more than 20% above
the price the campus bookstore paid to the publisher for any
textbook or supplemental material. There are several major
policy questions the Committee should consider in evaluating
this provision, including:
1) How will this effect competition with non-campus
bookstores ? This bill only applies to campus bookstores.
Off-campus private bookstores and internet based
booksellers would not be bound by the provisions of this
bill.
2) How will this effect the various types of campus
bookstores ? The inventory of campus bookstores can be very
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different, some rely heavily on textbook and educational
material sales, which would be limited to the 20% markup,
and others may rely more on sales of food or clothing,
which have an unlimited markup. Some campus bookstores are
for-profit entities and others are non-profits, and yet
others are owned and managed by the campus or student
groups. It is unclear how this bill will impact campus
bookstores that already have such wide-ranging competitive
differences.
3) What is the rationale behind 20% ? It is unclear to
committee staff how the 20% limitation was reached;
therefore, it is difficult to know if this is an
appropriate cap.
Committee staff recommends that this provision be removed from
the bill so that more time can be given to evaluating the
proposal and understanding its potential ramifications.
Publishers' posting internet prices : Prior versions of this bill
required textbook publishers to freeze their textbook prices for
six months following a price quote to faculty. The June 29th
amendments remove this requirement and instead require textbook
publishers who quote prices to faculty to post prices and price
changes on their websites. If the intent of this bill is to
prohibit textbook publishers from raising prices between the
time a price is quoted to faculty and the time of the bookstore
textbook order, the recent amendments do not apper to accomplish
this goal.
Author's Amendments : Committee staff understands that the
author will propose an amendment to require a textbook
publisher to maintain textbook and supplemental materials
prices for at least six months.
Additionally, it is unclear why textbook publishers should only
be required to post on their website the prices for textbooks
and supplemental educational materials for which a price was
quoted to faculty.
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Committee staff recommends the bill be amended to require
textbook publishers to post all textbook and supplemental
educational material prices on their internet website.
Related legislation : SB 216 (Liu), which was held in Senate
Appropriations Committee, would have required the CSU Board of
Trustees and the CCC Board of Governors, and requested the UC
Regents, to post a list of required textbooks for each course
for the coming term on their Internet websites not less than 30
days prior to the first day of class, including the price
charged by the campus bookstore for each required textbook. In
addition, SB 386 (Runner), which was held in the Senate
Appropriations Committee, would have required CCC and CSU
faculty, and requested UC faculty, to prepare a justification on
the adoption of a new edition of any textbook within three years
of a previous adoption.
Prior Legislation : SB 832 (Corbett) of 2007, which was vetoed
by the Governor, would have required textbook publishers to
provide prospective purchasers at public and private
postsecondary institutions with specific information. AB 2477
(Liu), Chapter 556, Statutes of 2004, required the CSU Board of
Trustees and the CCC Board of Governors, and requested the UC
Board of Regents to work with the academic senates to encourage
faculty to give consideration to the least costly practices of
assigning textbooks.
REGISTERED SUPPORT / OPPOSITION :
Support
None on File
Opposition
Barnes & Noble College Booksellers
California Association of College Stores
Forty-Niner Shops, Inc., CSU Long Beach
Pasadena City College
Pierce College
Three Individuals
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Analysis Prepared by : Laura Metune and Paul Coaxum / HIGHER
ED. / (916) 319-3960