Issue date: 4/30/08 Section: News

Media Credit: Martin Wood [Click to enlarge]

An amendment to the Public Records Act could make textbook markup prices available to students, a move creating more transparency regarding agreements between the University Enterprises Inc. and Follett's management of the Hornet Bookstore.

Ed Ober, senior government major and faculty policy member, believes it needs to happen.

"I thought students should know what the markup (on textbooks) is," Ober said.

"The fact that they won't disclose some of this information is concerning."

Ober has decided to propose an amendment to the Public Records Act making "auxiliary" organizations like University Enterprises Inc. not be protected from providing what are considered "trade secrets."

UEI is a non-profit corporation providing campus services, one being the Hornet Bookstore. An auxiliary organization provides additional supplementary support to the university. The Follett Corporation has managed the bookstore since June 2005.

Ober went last week to the Capitol, speaking to members of Congress who might be able to lend support.

So, what would this mean to students? If the case was taken to court, Ober said he hopes to prove that since UEI operates for the benefit of the university, students should know how much profit it makes.

Lisa Hall, director of planning and resource development for UEI, acknowledged that there are profit markups.

"There would have to be - any business would have to have a markup to cover its costs," Hall said.

"There are a lot of ways (Follett) is trying to keep the costs down...That's a part of the big reason we partnered with them," Hall said. "With the nationwide resources, there is a lot more buying power."

She specified that after the faculty chooses the books, Follett then goes to the market to find the best buying option.

Whether or not the mark-up prices should be public is a legal matter, she said.

Markup prices are considered "trade secrets" because UEI is a private organization. University Counsel Edmundo Aguilar said he doesn't think an amendment to the Public Records Act would make those markups available.

"If it changed, I think he would get the same information," Aguilar said. "It's still proprietary law."

Ober made a public records act earlier this month requesting 11 documents, including UEI minutes and contracts with Follett. Aguilar responded 14 days later after evaluating the legal provisions.

"We try to be as transparent as we can," Aguilar said. "That's why we've given up as much as we can."

The two documents Ober wanted to see the most have not been released.

One of Ober's requests stated, "A written statement or document regarding the typical (or range of) discount off publisher's list price on textbooks that: a) Follett receives, and b) that UEI received when it was purchasing the textbooks directly prior to Follett."

The second stated, "a statement of the salary ranges for bookstore and UEI job categories."

Aguilar provided three court cases to prove that the markup information is proprietary.

Ober said Aguilar's citing of the California Civil Code Section 3426.1 is inapplicable and does not support it.

According to the code, "Trade secret" means information, including a formula, pattern, compilation, program, device, method, technique, or process, that: (1) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and (2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy."

Ober says neither sections are applicable. For the first, "the markup rate does not derive any economic value from being concealed."

For the second clause, "I would argue that this in fact does not apply because it was not in existence prior to the agreement with Follett. The contract specified the rate, and an agreement with a public institution is not, or should not, be a trade secret. It should be public information."

Aguilar stated that Ober would have to go to court to release this type of information.

"We just follow case laws - that's what we are bound by," Aguilar said.

That answer is not good enough for Ober.

"In my view, the only legitimate basis for his continuing concealment of the markup rate is found in the California State University v. Superior Court case which states that an auxiliary of the university is not a state agency within the meaning of the CPRA," Ober said. "This status I am going to fight to overturn through legislative and possibly legal means."

By May 16, Ober will know when he is able to view the available documents.

"That court case (California v. Superior Court, 90 Cal. App. 4th 810) is all that is standing between us and those records," Ober said. "There is a disconnect between court intentions and legislation."

The case defines that auxiliary organizations are protected by proprietary laws.

While Ober wants students to see what the markup prices are and obtain maximum transparency, he think this is just one issue.

"This whole issue ties into a another issue: the decision about how (UEI) uses its money," Ober said.

Ober believes that since UEI as a non-profit serving the needs of the university, it should be treated as a public agency.

"This issue is you are a public agency whether the court thought you are not. You are here to serve the school and students…apparently they do have something to hide."

Chloe Daley can be reached at cdaley@statehornet.com.

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