BILL ANALYSIS Ó SENATE COMMITTEE ON EDUCATION Alan Lowenthal, Chair 2011-2012 Regular Session BILL NO: SB 1539 AUTHOR: Corbett INTRODUCED: February 24, 2012 FISCAL COMM: No HEARING DATE: April 25, 2012 URGENCY: No CONSULTANT: Lynn Lorber SUBJECT : Postsecondary education: textbook information. SUMMARY This bill requires textbook publishers to provide to faculty at the commencement of sales interactions specific information about all products the publisher sells in the subject area. BACKGROUND The federal Higher Education Opportunity Act (HEOA) requires publishers (when providing information to faculty or others who select course materials at an institution of higher education receiving federal financial assistance) to include in writing: 1) The price at which the publisher would make the textbook or supplemental material available to the campus bookstore and, if available, the price at which the material is available to the public. 2) The copyright dates of the three previous editions. 3) A description of the substantial content revisions made between the current edition and the previous edition. 4) Whether the textbook or supplemental material is available in any other format, including paperback and unbound. The federal HEOA requires each institution of higher education to: 1) Disclose in the institution's Internet course schedule, for each course listed, the International Standard Book Number (ISBN) and retail price of required and recommended college textbooks and supplemental materials. SB 1539 Page 2 2) Make available to a college bookstore the most accurate information available regarding the course schedule and for each course offered the ISBN, retail price, number of students enrolled in the course, and the maximum student enrollment for the course. (United States Code, Title 20, Chapter 28, Section 1015(b)) The College Textbook Transparency Act requires, beginning January 1, 2010: 1) Textbook publishers to print on the cover or within each textbook a summary of the substantive content differences between the new and prior editions, and the copyright date of the previous edition. 2) Each campus bookstore at any public college or university to post in its store or on its website a disclosure of its retail pricing policy on new and used textbooks. 3) Each public college or university to encourage personnel responsible for selecting course materials (typically faculty) to place their orders with sufficient lead time to enable the bookstore to confirm the availability of the requested materials. (Education Code § 66406.7) Current law requires: 1) The CSU and CCC, and encourages the UC, to work with the academic senates of each segment to encourage faculty to give consideration to the least costly practices in assigning textbooks and to work with publishers and college bookstores. 2) College bookstores to work with the academic senates of each campus to review the process and timelines involved in ordering and stocking textbooks and to create bundles and packages of instructional materials that are economically sound. 3) Urges textbook publishers to provide specific information to faculty and post that information on the company's SB 1539 Page 3 website, give preference to supplements rather than producing a new edition and disclose the length of time the current edition is intended to be in production. (EC § 66406) 4) Requires textbook publishers, by January 1, 2020, to make the textbooks available, in whole or in part, for sale in an electronic format. The electronic version of any textbook must contain the same content as the printed version and may be copy-protected. (EC § 66410) ANALYSIS This bill requires textbook publishers to provide to faculty at the commencement of sales interactions specific information about all products the publisher sells in the subject area. Specifically, this bill: 1) Requires textbook publishers to provide to a prospective purchaser of the textbook with all of the following: a) A list of all the products offered for sale by the publisher germane to the prospective purchaser's subject area of interest. b) The wholesale or retail price of the product, and the estimated length of time the publisher intends to keep the product on the market. c) For each new edition, a list of the substantial content differences or changes between the new edition and the previous edition of the textbook. 2) Requires publishers to make the information available to a prospective purchaser at the commencement of a sales interaction, including but not limited to, a sales interaction conducted in person, by telephone or electronically. 3) Requires publishers to post the information on their websites. 4) Defines the following: SB 1539 Page 4 a) "Product" means each version of a textbook, or set of textbooks, in a particular subject area, including supplementals whether or not the supplementals are sold separately or together with a textbook. b) "Publisher" has the same meaning as in the College Textbook Transparency Act, which is any publishing house, publishing firm, or publishing company that publishes textbooks or other course materials, specifically designed for postsecondary instruction. c) "Purchaser" means a faculty member of a public or private postsecondary education institution who selects the textbooks assigned to students. d) "Textbook" has the same meaning as in the College Textbook Transparency Act, which is any book that contains printed material and is intended for use as a source of study material for a class or group of students, a copy of which is expected to be available for the use of each of the students in that class or group. "Textbook" does not include a novel. STAFF COMMENTS 1) Need for the bill . According to the author, "Increases in textbook prices have outpaced median household income. Textbook prices have steadily increased over the last four years, at four times the rate of inflation. According to a Bureau of State Audits report, on average, publishers release a new or revised edition every three or four years, with each one costing 12% more than the last. The report also found that faculty often fail to consider the cost of textbooks when making course selection. By having textbook pricing information automatically available at the start of a transaction, faculty would be able to make an informed decision on what to purchase by comparing product prices and differences in content." 2) Some duplication . Current law already requires publishers to give to faculty (at both public and private SB 1539 Page 5 universities) information about differences from prior editions, and the price the textbook will be offered to the campus bookstore and to the public. Publishers are not required to disclose the estimated length of time the product will be on the market, but publishers are already required to disclose to faculty the copyright dates of the three previous editions. This bill essentially restates federal law with respect to publishers providing specific information about textbooks, and adds requirements that publishers provide to faculty a list of the all products and the anticipated length the product will be on the market. This bill also requires publishers to list information about textbooks on their websites. 3) List of all products . This bill requires publishers to disclose to faculty all products offered for sale that are germane to the faculty's subject area of interest. This bill defines "product" to include each version of a textbook or set of textbooks, including a supplemental item whether or not the supplemental item is sold separately or together with a textbook. Instructional materials may be offered in formats other than print. Current law requires publishers to disclose to faculty if textbooks are available in other formats, such as paperback or unbound, but is silent about digital formats. Staff recommends an amendment to add to the definition of "product" a reference to digital formats, thereby clarifying that publishers must disclose to faculty all types and formats of available products. 4) Time on the market . This bill requires publishers to provide to faculty the estimated length of time the publisher intends to keep the product on the market. Publishers may not have a planned schedule for prospective editions. Current law requires publishers to provide to faculty the copyright dates of the three previous editions of textbooks, so it's possible for a publisher or faculty to identify if there is a pattern for the introduction of new editions. SB 1539 Page 6 5) Wholesale or retail price . This bill requires publishers to provide to faculty the wholesale or retail price of the product. It is necessary to make the distinction of wholesale or retail (rather than wholesale and retail) due to concerns about putting publishers at a competitive disadvantage when releasing wholesale pricing information. 6) Federal report due in 2013 . The federal Higher Education Opportunity Act requires the Comptroller General of the United States to report, by July 1, 2013, on the implementation of the requirements imposed upon institutions of higher education, college bookstores and publishers, and particularly examine: a) The availability of college textbook information on course schedules. b) The provision of pricing information to faculty by publishers. c) The use of bundled and unbundled material. d) The implementation of the HEOA by institutions of higher education, including the costs and benefits to such institutions and to students. 7) Related legislation . SB 1154 (Walters) is similar to this bill regarding the disclosure of available digital formats. SB 1154 is specific to K-12 instructional materials and is scheduled to be heard by this Committee on April 25, 2012. AB 2471 (Lara) requires the Trustees of the California State University and the governing board of the California Community Colleges, and urges the Regents of the University of California and the governing body of each private postsecondary educational institution that offers a baccalaureate degree to adopt policies to prohibit the assignment of an e-textbook unless that e-textbook complies with various provisions. AB 2471 is pending in the Assembly Appropriations Committee. SB 1328 (De Leon) requires a publisher that supplies textbooks or other instructional material to a postsecondary SB 1539 Page 7 institution or faculty to provide specific information about that textbook or material using a standard XML or comma-delimited format, or both, and requires publishers to submit the data to the Multimedia Educational Resource for Learning and Online Teaching program. SB 1328 is pending in the Senate Appropriations Committee. SB 1052 (Steinberg) establishes the California Open Education Resources Council for the purpose of reducing textbook costs for the 50 most widely taken lower division courses. SB 1052 is pending in the Senate Appropriations Committee. SB 1053 (Steinberg) establishes the California Open Source Digital Library for the purpose of housing open source materials. 8) Prior legislation . SB 832 (Corbett, 2007) was nearly identical to this bill. SB 832 was vetoed by the Governor, whose veto message read: I am supportive of efforts to address the cost of college textbooks and share the concern that these education costs have an impact on the affordability of college for many students. However, this bill focuses strictly on textbook publisher policies and fails to recognize that the affordability of textbooks is a shared responsibility among publishers, college bookstores, and faculty members. Therefore, instead of this bill, I am signing Assembly Bill 1548. Many of the same concepts in SB 832 are included in AB 1548, but AB 1548 recognizes the shared responsibility and attempts to address the issue in a more comprehensive manner. SUPPORT Associated Students of the University of California, Davis California Community Colleges Chancellor's Office California Faculty Association CALPIRG Community College League SB 1539 Page 8 Faculty Association of California Community Colleges Kern Community College District Los Rios Community College District Rio Hondo Community College District San Diego Community College District University of California West Kern Community College District OPPOSITION Association of American Publishers