Jim,Those are crooks then. Any shop that only allows personal gear they sell you should fail. The most expensive item may be mask. But you can often find a scubamax style brand for under 50 bucks. Snorkel should be a simple 12 to 15 dollar j tube. If the shop doesn't carry one get one from Amazon.
Boots? Can be found for under 50 easy.
Fins? Open heel from ebay or again, scubamax or Sherwood for 75 bucks or so.
Mask, fins, snorkels (and gloves) are high profit margin items. When you pay an instructor $50 max per student, you focus on volume. They don't make money off courses really, despite the paltry instructor payment. They are not interested in retention. The profit margin from the required items is enough.
The shops that don't operate this way are the exception. At least in my area.