Bookstore considers change not-for-profit

It’s not much but it’s a start.

Textbook prices are due to go down by 1 percent as of August 1, assuming the PSU bookstore changes from co-op to not-for-profit status.

Ken Brown, bookstore manager, says as things shake down under the proposed new status, he is hopeful he can reduce textbook prices even further, as well as prices in other areas of merchandise.

“We have to take the change before the co-op membership,” Brown said.

The co-op’s board has scheduled a special membership meeting at noon May 13 to discuss the possible change to a not-for-profit. The location has yet to be chosen but Brown is aiming for somewhere in the Smith Center.

Under the co-op bylaws, any number of members attending the special meeting will constitute a quorum. Brown expects approval and sees increased benefits ahead for all students.

“We will finally be at a place where we can address student concerns in a positive way,” he said.

Besides the immediate reduction in textbook prices, the change will create a scholarship fund for textbooks, details to be announced.

“We have been working with OSPIRG (the Oregon Student Public Interest Research Group) on textbook prices for the past year,” Brown said.

The change in bookstore status to not-for-profit will eliminate the rebates enjoyed by members in the past. However, Brown said, of the 913 members in the last fiscal year, only 282 people submitted receipts and got rebates, with an average rebate of $35.73.

“Looking at the trends in membership, this change can benefit all students except the 282.”

One change is that alumni will no longer be eligible to become members, but Brown does not consider that a major obstacle. The co-op currently has only 37 alumni members.

The reason for the proposed change is financial. The bookstore has not had to pay taxes since 1997, but it will start paying this year.

“We are taking the step and we don’t see any compelling reason not to,” he said.

Brown took over as bookstore manager in 1996. In 1997, the bookstore took an accounting loss of $400,000 by writing off obsolete inventory. This loss has been taken over a period of nine years. The store’s audit firm advised the board that the loss has been written down and the bookstore will be paying taxes this year. The bookstore’s fiscal year runs from August 1 to July 31.

Members of this fiscal year will be assured of their rebates if the bookstore goes not-for-profit as of August 1.

“We will retain an amount for rebates this year,” Brown explained. “The co-op will continue to exist after August 1 for members to submit receipts and for rebates to be issued.”

The “new” bookstore will create its own membership, which will be free, rather than charging the $1 for current co-op membership. All current co-op members will automatically become members of the new entity.

Brown said the new status has promise for more financial benefits for students.

“We may be able to further lower the markup on textbooks once the conversion is done. It is our intent to lower them more,” Brown said. He said the entire situation will be reviewed at midpoint next year.

He said the bookstore is also working with professors on such savings as specifying textbooks which can be procured as used rather than the newest editions, which may not be that different from earlier printings.

Savings may be possible in other areas of merchandise but not in computer-related supplies.

“We operate those on a razor-thin margin,” he said.

Brown said the changeover has been simmering with the co-op board for some time, as the tax write-off gradually disappeared. The potential taxes next year are $75,000, with an additional $40,000 in property taxes, plus payments on a bank loan.

Both the Oregon State University bookstore and the University of Oregon bookstore converted years ago from co-op to not-for-profit.

Both OSU and U of O bookstores do a much bigger business in clothing than PSU’s, Brown revealed, although in the past two years clothing sales have increased. The other schools do $1 million in clothing sales but, he pointed out, “We’re not close to Pac-10 level.” Clothing sales tend to be athletics-related and a popular category with alumni.

Brown said he is working closely with, and soliciting the approval of both the administration and ASPSU for the changeover.

“We are working on some new benefits,” Brown summarized. “By shifting our model a little bit we would be benefiting more people financially. We want to be enhancing benefits and meeting the needs of students in the 21st century.”