CDL Process for One-Time Purchases and Guidelines for Campuses When Purchasing Local Resources

Endorsed by Collection Development Committee (CDC) on May 20, 2011

Summary

CDL has core funds within its general budget that are available for consortial library acquisitions.  CDL uses these funds strategically during the year: for example, to support major negotiations through the purchase of priority content in exchange for lower annual, ongoing campus cost increases, to acquire journal backfiles to facilitate management and deduplication of print holdings, or to facilitate the transition from print to digital purchasing in various formats (e.g. ebooks).  When there are funds remaining at the end of the year, CDL funds are also used to provide system-wide access to new resources that are a high priority for UC selectors.

At the same time that CDL is making decisions about acquisitions, campuses often have their own end-of-year funds that can be spent on similar resources.   CDL and the campuses must work closely at this time of year to coordinate their activities and avoid unintended duplication.

It is not uncommon for CDL and individual campuses to purchase the same products, usually in different fiscal years.   In the past, campuses have often expected CDL to arrange refunds for prior local purchases. While this was frequently possible in a more prosperous era, in a time of dwindling resources such practices pose an increasing challenge to the strategic use of system-wide purchasing capacity.  To ensure that CDL’s one-time funds are used to the best strategic advantage on behalf of all campuses, the Joint Steering Committee has endorsed the following guidelines to address the relationship of CDL and campus purchases.

1. CDL will use its core funds to the best of its ability for the benefit of all campuses, weighing factors such as strategic benefit, a balance in subject disciplines and bibliographer priorities.
2. CDL will use its discretion when offering refunds to campuses that have made local purchases; these decisions will vary on a year to year basis depending on the circumstances and CDL funds that are available.
3. There are no guarantees that a campus will receive a refund from CDL for prior purchases. When refunds are not possible, CDL will attempt to ensure that early adopter campuses derive some benefit from a CDL purchase (e.g. in the form of lower ongoing maintenance fees).
4. In no case will a duplicate payment be made to a publisher or vendor for the same resource.  If both CDL and the campus have inadvertently purchased a given resource, a refund (preferred) or credit will be arranged directly from the vendor who received both payments.
5. CDL and campuses will work together to share information and acquisition activities in a timely way so that the best acquisition decisions can be made in parallel.

Background

Each year at the approach of fiscal close, campuses may have one-time funds to purchase local resources.  Often these funds are managed by the campus selectors for acquisitions in specific disciplines such as chemistry or U.S. history to support local campus collection needs.  In the same timeframe or at a later date, CDL may end up purchasing the same resource for system-wide access.

Recently the question has arisen regarding what is fair in terms of campus refunds for their earlier purchases when CDL makes a purchase on behalf of the UC system.  As budgets become tighter, campuses are requesting (and expecting) refunds with more regularity. The CDL purchase in 2010 of several Wiley backfiles and ProQuest historical newspapers generated considerable discussion about the issue of campus refunds.

At the same time, CDL’s budget for one-time acquisitions has also been significantly curtailed due to the current fiscal environment.  Historically CDL funds originate both from the licensed content budget as well as, on occasion, from other CDL sources when funds are unspent at the end of the year due to fewer servers purchased, consultants not hired etc.  As in the case of the campus libraries, the funds available at the fiscal year end are unpredictable, often requiring rapid decisions to ensure that funds can be utilized for the benefit of the campuses.

One-time funds are spent at CDL’s discretion for the greatest benefit:  stretching the dollars as far as possible and providing system-wide access to highly desirable resources.

CDL is firmly committed to this goal:  to make the best consortial use of its diminishing funds.  In FY 2009/2010, CDL used its limited funds to purchase core resources that some of the campuses had already acquired but other campuses lacked, such as historic archives of the Chicago Tribune and Washington Post.  In this way, CDL’s funds are used strategically to ensure access and equity across all UC user communities.

JSC Discussions

CDL requested guidance from JSC in FY 2010-2011 regarding the question of campus refunds.  Rather than creating a formal CDL policy which would be difficult to enforce due to the unpredictable nature of one-time purchasing and uneven vendor response to refunds or adjustments, JSC recommended that guidelines be developed to inform local decisions made by campus selectors with regard to local one-time purchases.

JSC reaffirmed that there are clear benefits to being an ‘early adopter’: often pre-publication or lower pricing is available, local users have early access to the resource in some cases years before other UC campuses, and they are able to wisely spend local funds that would otherwise be rescinded at the fiscal close.

JSC was, however, interested in clarifying how one-time decisions are made by CDL, how that might inform local decisions with regard to the deployment of local funds as well as potential campus refunds, and how to communicate this information broadly and in a timely way to the bibliographer groups.

CDL Acquisition Decisions

The first step in CDL’s acquisition process is to compile a wish list of one-times that are of interest to UC libraries. In previous years, CDL referred to the Annual JSC Survey for ideas on potential one-time purchases and vetted a list of potential one-times with JSC each year.  Typically these lists are posted to the CDL website for access by the campuses to facilitate communication about potential year-end purchases.

In early 2010 and again in 2011, CDL sent a request for input and prioritization of one-time purchases to UC bibliographer groups.  CDL compiled an extensive list from the bib group submittals and used the list to make acquisition choices. The list will be updated annually as funds allow by an invitation to the bibliographer groups to update their choices.  All campus selectors are encouraged to participate in this process.

With a short list of potential one-time purchases, CDL begins to contact vendors and negotiate for the most high-quality content at the least cost.  Ultimately the choices made result from many factors: the resources are highly discounted (often by leveraging multiple purchases with a single vendor); multiple bib groups have requested a resource or it has been requested for a number of years; CDL already has a favorable license with the vendor; willingness on the part of the vendor to work quickly to close the deal and generate an invoice; e-books or backfiles are tied directly to e-journal contracts (i.e. when there is a license clause that reduces the annual price increase of the e-journal package through additional revenue to the publisher with non-journal products); and other complex factors.  Decisions are often made in the final days before the deadline on which invoices must be paid for a given fiscal year.

Because it is difficult to predict in advance what products are finally purchased in the last few weeks prior to fiscal end, it is important that CDL and the campus selectors keep in close communication.  CDL also routinely asks the vendor to notify us of all prior purchases, to let us know immediately of any current campus activity, and to provide pricing options accordingly. If a campus has recently purchased or is in the process of purchasing the same product in the current year, CDL will usually attempt to ensure that the campus gets a full refund.

If a local purchase occurred in earlier years, CDL will arrange pricing with the vendor that takes those prior purchases into account in the form of reduced pricing, full or partial refunds, future product credits or other solutions to ensure fairness for the early adopters, subject to the Guidelines outlined below.

Campus Acquisitions

During local purchasing, campus selectors should adopt the same approach and discuss with vendors what their policy is for a refund or credit in the event that CDL later acquires the same product on behalf of all campuses.  It is important to formalize this discussion with the vendor, either through a local license clause, specific language on the invoice prior to payment or an e-mail thread that shows the vendor’s agreement. This documentation might become important years later in the event that CDL purchases the same product.

This should not be considered a guarantee of a refund or credit, but rather a business term that allows for refunds or credits when feasible and appropriate.  CDL will develop standard language for this for campuses to include in their licenses.

Guidelines for Campus Refunds for CDL Purchases

In the event that a campus purchases a resource in the same fiscal year as CDL, the campus is entitled to a 100% refund assuming sufficient funds are available.  This is fair because the campus would have been unlikely to purchase the product in question if it had known that CDL might purchase that same product in the same year, and vendor accounting policy can generally accommodate such shifts.  Alternatively, the campus can choose to waive its request for a refund in order for CDL to acquire more products.

If a campus has purchased a product in previous years there is no guarantee of a refund.  CDL will consider arranging for a partial refund or credit from the vendor if permitted by the vendor and considered to be in the best interest of the system as a whole.  Factors affecting whether CDL will attempt to seek refunds for prior purchases include the tradeoff between procuring refunds for ‘early adopter’ campuses versus the opportunity to leverage expenditures to acquire additional resources for the system, whether obtaining refunds will have a negative impact on the ability to procure multiple product discounts, and the ability to procure a ‘substitute’ benefit for early adopter campuses in the form of significant reductions in ongoing maintenance fees.

Coordinating CDL and Campus Acquisitions

It is beneficial to coordinate purchases, if appropriate, for the benefit of the whole system in terms of pricing, licensing and access to new resources.  In 2010 and currently, CDC uses the wiki to post and track the one-time resources that each campus is considering at year end. This has proven very useful for CDL to gauge interest levels by the campuses, and to alert campuses of CDL’s acquisition plans to purchase the same resource.

Recently, a number of campuses have purchased resources on behalf of other campuses using their own local funding.  Examples include UC San Francisco’s acquisition of the Annals of the New York Academy of Sciences archive, several IOP journal archives purchased by UC San Diego, and UC Santa Cruz’s purchase of The Sixties archive (Alexander Street Press), among others.

The long-standing practice of co-sharing ongoing purchases has also been extended in recent years to large one-time digital products.  A major example was the purchase of the ACS Journals Archive in 2008 by UC Berkeley, UCLA, UC Merced, and Lawrence Berkeley Lab. In that same year, CDL and UC Santa Cruz jointly purchased the Blackwell journals archive.  In 2011, UC Berkeley and CDL will share the cost of the Chinese newspaper Shen Bao, and a shared system-wide purchase of the Thesaurus Linguae Latinae between CDL and several campuses is under consideration. The combined purchasing power of individual campuses in facilitating system-wide access, long a hallmark of UC’s success, is likely to become an increasingly important strategy for purchases of one-time content going forward.  How to ensure that procuring acceptable system-wide licensing terms receives priority treatment in the context of greater reliance on campus-initiated collaborative purchasing may bear some future discussion and attention.

Campus selectors are encouraged to contact CDL (Wendy Parfrey) with questions or information about one-time purchasing at any time during the year and particularly at year end.  This will allow CDL to ‘connect the dots’ between local purchases and provide negotiation support or guidance as campuses pool their funds with vendors for Tier 2 or Tier 3 acquisitions.