A new report from the Student PIRGs sheds light on the complexities and pitfalls of automatic textbook billing programs. These programs, often branded as "Inclusive Access" or “Affordable Access Programs,” add the cost of course materials into students' tuition fees, promising ease and savings. However, the report reveals that these programs may not always deliver on their promises, raising critical questions about the actual cost benefits for students.

The report, entitled Automatic Textbook Billing: Limited Choice, Uncertain Savings, dives into the fine print of legal agreements between institutions and textbook vendors. Researchers analyzed 171 contracts from 92 institutions to assess the true nature of these programs and their implications for student expenses. Here are the key findings from the report:

• Unclear Savings: The report finds that the savings promised by automatic textbook billing programs are often difficult to evaluate. Contracts with publishers, bookstores, and digital platform providers typically lack clear, transparent pricing structures. While it is common for contracts to offer discounts, these are often based on list prices set by publishers that can increase at anytime. This makes it challenging to determine the true savings for students.

• High Participation Quotas: Many contracts examined in the report include minimum participation quotas, requiring a significant percentage of students to purchase their materials through the automatic billing program. In some examples, failure to meet these quotas results in the loss of discounts, or even termination of the contract. These potential penalties could discourage schools from raising awareness about student’s ability to opt-out of the program.

• Conflicting of Interests: The report raises concerns about the financial relationship between schools and third-party bookstore operators. Many contracts include commission payments from bookstores to the colleges, creating a potential misalignment of interests. These payments, often tied to increased sales generated through automatic billing programs, may disincentivize institutional support for more cost-effective alternatives like open educational resources (OER).

The report makes the case that policymakers and campus leaders need to take steps to protect students' financial interests with respect to automatic textbook billing programs. Recommendations include ensuring that pricing structures are transparent and verifiable, rejecting contract provisions that limit the promotion of used or rental textbooks, and making automatic billing programs opt-in rather than opt-out. Additionally, faculty are encouraged to adopt OER to foster a more competitive and affordable textbook market.

The report also calls on the Biden Administration to finalize a proposed regulation that would ensure that students receiving federal financial aid have the right to opt-in to books and supplies charges, rather than being charged without their consent. 

"Making these programs truly optional empowers students to decide whether these programs offer the savings benefits they claim. This is an opportunity to support a common-sense, student-friendly policy," the report says.

The report can be downloaded in full from the Student PIRGs website.