Colleges, Education Department at Odds Over Inclusive Access Changes

After three rounds of talks, a rule-making advisory committee on Wednesday failed to reach agreement on an Education Department proposal that would prevent colleges from automatically billing students for books and supplies.

The proposal, which colleges and universities say would undermine their efforts to provide students with affordable course materials on the first day of class, became one of the most contentious issues in this round of negotiated rule making—a lengthy process that the Education Department must go through before making certain regulatory changes. The current rules helped to spur growth in a procurement model for mostly digital textbooks and course materials known as inclusive or equitable access.

Under the model, unless students opt out, they receive all required course materials, which are offered for sale at below-market rates through deals struck between institutions, publishers and campus bookstores, and they pay for them as part of their tuition. Under the department’s proposal, students would have to opt in before colleges and universities can charge them.

A panel of negotiators representing the department and 15 constituencies reviewed the proposal, along with other changes to rules governing accreditation, state authorization and distance education, among other topics, with the goal of reaching unanimous agreement or consensus. If the committee doesn’t reach consensus during the sessions, the department can subsequently suggest whatever changes it likes, though a proposed rule will still be subject to public comment. Any regulatory change won’t take effect until July 2025 at the earliest.

The talks revealed fundamental and intractable differences of opinion over the department’s plan, one of several proposed changes aimed at giving students more choice over how they spend their financial aid dollars.

Publishers, college and university leaders, and negotiators representing institutions have argued that shifting the access models to opt-in would effectively end inclusive access programs, because the pricing relies on the participation of a large bulk of students.

Greg Martin, the negotiator for the department, said during Wednesday’s session he didn’t find that to be a credible argument.

“If a publisher is shaking down an institution and saying that if you don’t go opt-out, we’re not going to give you that price, I find that to be disingenuous,” Martin said. “If opt-out goes away and they aren’t going to give you a preferred pricing structure, I view that as being on the publishers, not the department.”

Department officials have said that the existing policies lack transparency and sufficient disclosures. Awareness of the opt-out option is lacking, they and consumer protection advocates argued, and the process can be difficult for students to navigate. The department pointed to comments from negotiators as well as from the public, who have said the current regulations allow institutions to cut deals that are financially advantageous to them or to publishers but aren’t necessarily in the best interest of students.

Negotiators representing institutions said inclusive access saves students money and ensures they have the course materials they need. They proposed regulatory language in February during the second round of talks aimed at bolstering the disclosures to students, ensuring that the materials are provided at or below competitive market rates, and creating a clear and conspicuous opt-out process. Under their proposal, institutions would have had to certify annually that the materials are in fact offered at or below competitive market rates.

“In an opt-in model, students are choosing to go without the material altogether,” said Jason Lorgan, executive director of student affairs at the University of California, Davis, and the negotiator representing public four-year institutions. “We’re trying to make the default that students have access to content.”

None of the institutional negotiators’ suggestions appeared in the department’s latest proposal, released last week before the final round of meetings.

Martin said that while department officials are concerned about transparency and disclosures, they also want to ensure students have a choice to purchase their own materials. The department wouldn’t be “amenable to any language that provides opt-out,” he said.

Martin said the department is not trying to prohibit inclusive access models, but rather to adjust them. “It’s not as easy as you’d like it to be, but it’s a student protection,” he said.

In memos sent to the committee, a group of negotiators in favor of the changes questioned the savings and other benefits that inclusive access programs provide to students.

“I feel it’s a disingenuous argument to say this model can only work with an opt-out,” said Carolyn Fast, director of higher education policy at the Century Foundation, a progressive think tank, and a negotiator representing consumer advocates. “It doesn’t make a lot of sense to me. It feels like it has more to do with the profits of textbook companies than actual ways that a system could work.”

In the end, 11 negotiators representing institutions, accreditors and state officials didn’t support the proposed changes to the cash management regulations, which included the textbook billing provisions. Five negotiators—representing the department, student veterans, student borrowers, consumer advocates and legal aid organizations—voted in favor of the change.

Scott Dolan, executive dean of the College of Liberal Arts and Sciences at Excelsior University in New York and a negotiator representing private nonprofit institutions, said he wanted more data and evidence about the problem that department is trying to address. It would’ve been helpful, he said, to know at the start of negotiations that continuing with the opt-out provision was a nonstarter for the department.

Dolan also took issue with the tone of the talks, which he felt questioned the integrity of his colleagues.

“It’s not fair,” he said. “Let’s negotiate what the real issue is, which is choice and what we define as choice. We could have a more informed conversation to get here. Fundamentally, we have philosophical differences and are operating from different first principles.”

The proposed changes in cash management rules also included a provision that would alter how colleges handle unused meal plan dollars. The department wants colleges to return those leftover funds to students. Currently, institutions can keep the funds, which their representatives said go toward student services. This change would only apply to cash-value meal plans as opposed to those that have swipes.

Martin said the department hasn’t seen evidence of meal plans as an area of abuse, but “conceptually, we have a problem with it.”

“Where this is cash value,” he said, “giving it back to students is the right thing to do, even if it does involve some degree of administrative burden on schools.”