Contract Checklist
[an error occurred while processing this directive]How to use this checklist:
1. Print this document (2-3 pages, portrait orientation)
2. Review your vendor contract section by section
3. Check the box for each question as you find the answer
4. Note any questions where the contract is vague or missing language
5. Use the Reference Guide to understand why each question matters
You can also fill this out digitally and print when complete.
1. License Type
Understand what you're actually buying and what happens to your access.
Perpetual licenses give you permanent access after purchase; subscription requires ongoing payments. Subscription models lock you in but vendors prefer them for recurring revenue.
Many vendors take content away completely when your subscription ends. You need language guaranteeing you keep what you paid for during active years.
Vendor bankruptcy is rare but highly disruptive. You need a clause requiring them to either release content to you or provide a 6-month wind-down period.
Lock-in happens through data. Standard formats (CSV, JSON) let you migrate to another vendor. Proprietary formats trap you.
2. Exclusivity & Restrictions
Know what you can and can't do with content your patrons access.
Publishers sometimes delay library access to new books. A 6-month embargo means patrons can't access bestsellers when demand is highest.
Fixed embargoes are predictable; variable ones mean content availability changes without notice. Budget and user expectations depend on knowing the timeline.
Some licenses restrict use to patrons only. Your librarians need access to understand collection value and recommend materials.
Remote work and distance learning make geographic restrictions obsolete and user-hostile. Clarify whether remote patrons and at-home staff can access content.
Many vendors prohibit ILL to prevent libraries from sharing one subscription. This affects regional resource sharing and your ability to support neighboring libraries.
3. Pricing & Renewal
Protect your budget from surprise costs and unmanageable price increases.
Auto-renewals caught you off guard before. You need 60-90 days' notice to budget for renewal or to non-renew. Short notice windows lock you in.
Without a cap, prices can climb 10-20% annually, outpacing budget growth. Cap increases at CPI + 2% or negotiate "flat pricing" for 3-5 years.
Early termination fees can be 50% of contract value or more. If usage is low after year 1, you're locked in. Negotiate minimal or no early termination penalties.
Some vendors add fees for API access, data downloads, or exceeding vague "usage limits." These surprises blow up budgets. Require all fees to be specified upfront.
Usage-based pricing can reward or penalize your library unfairly. Negotiate fixed annual pricing based on enrollment or FTE, not fluctuating usage metrics.
⚠ Critical Section: This is where vendors hide the most aggressive terms. Read this carefully and push back hard on data and AI provisions.
4. Data & AI
Protect your patrons' privacy and prevent vendors from profiting off your content and user data.
Vendors are quietly licensing library content to train generative AI models. This means your licensed books train ChatGPT. Prohibit content use for model training and require explicit opt-in for any research use.
Patron reading habits are deeply personal. Using them to train AI without consent violates patron privacy and library ethics. This must be explicitly prohibited.
Vendors collect everything: reading patterns, search queries, time spent on pages, IP addresses, device info. Know exactly what data flows to the vendor and for what purpose.
Data brokers buy reading data to build consumer profiles and sell to advertisers, insurers, or marketers. Require explicit prohibition on data sales and third-party sharing without written patron consent.
Vendors won't admit what they do with data unless forced. Require annual or on-demand audit rights and access to vendor data processing agreements with subcontractors.
Company acquisitions happen often and data usage terms change. Require that acquired vendors maintain current privacy commitments or return/delete patron data within 30 days.
5. Liability & Support
Ensure the vendor is accountable for service failures and can be held liable for breaches.
99% uptime sounds good but means 3.6 days of downtime per year. Negotiate 99.5% (4 hours/year) or higher. Require credits if they miss their SLA.
SLAs without teeth are useless. Require automatic service credits (% of monthly fees) when uptime drops below promised levels. Service credits should be applied without needing to submit a claim.
Liability caps of "annual fees paid" or less make breaches a cost of doing business for vendors. Negotiate higher caps for data breaches or service failures that exceed 72 hours.
6. Termination & Migration
Plan your exit strategy and ensure you can move to another vendor without losing data.
Tight notice windows create budget surprises. Require 60-90 days' notice requirement for non-renewal. Shorter windows mean accidental auto-renewals.
Data access windows of only 30 days after termination are too short to migrate. Require minimum 180 days for data export in standard formats and clarify what happens to perpetual content access after contract ends.
Vendors charge for migration support to lock you in. Require free transition assistance including API access, data format conversion, and technical support for moving to a replacement system.
Some contracts require returning prepaid amounts if you cancel early, or impose ongoing royalties on perpetual content after termination. These are red flags. Push back hard.