Cooperative Purchasing

Cooperative purchasing is a procurement mechanism through which state, local, and tribal governments are authorized to place orders on certain federal contract vehicles, primarily the GSA Multiple Award Schedule for specific categories, allowing them to leverage federally negotiated pricing without running their own competitive acquisitions.

What is Cooperative Purchasing?

Cooperative purchasing programs bridge the gap between the federal procurement system and the state/local government market. By enabling SLED (State, Local, and Education) buyers to access federal vehicles, cooperative purchasing creates significant market expansion opportunities for contractors who hold federal vehicle awards.

The primary federal cooperative purchasing authorizations:

GSA Schedule Cooperative Purchasing (E-Government Act, 40 U.S.C. 502(c)): State, local, and tribal governments can purchase from GSA Schedules for IT products and services and for security products and services (law enforcement, emergency response). This is the most widely used federal-to-SLED bridge. A state purchasing officer can place a GSA Schedule order for cybersecurity software at the federal negotiated price without a state-level competitive procurement, significantly accelerating acquisition speed.

DoD Law Enforcement Equipment (10 U.S.C. 381): State and local law enforcement agencies can purchase equipment through DoD's excess property programs.

HUBZone cooperative purchasing: Some HUBZone set-aside vehicles have cooperative purchasing extensions.

The practical operation: a state contracting officer identifies a vendor on GSA Schedule MAS, verifies the vendor has the relevant Special Item Number (SIN) and that the IT or security category qualifies for cooperative purchasing, and places an order. The order goes directly to the vendor; GSA's processes apply for pricing compliance and IFF payment. The state does not need separate state competitive procurement approval if the state's purchasing regulations recognize federal schedule cooperative purchasing (most do, but state rules vary).

Why cooperative purchasing matters for government contractors

Federal Schedule holders serving the SLED market gain significant competitive advantages: they can offer state and local buyers the same products/services at federal negotiated prices without the state buyer needing to run a competitive procurement. This dramatically shortens the state/local sales cycle. A vendor without a GSA Schedule competing for the same state buyer must wait for a formal competitive procurement (often 6-18 months); the Schedule holder can close the sale when the buyer is ready. Cooperative purchasing is the reason IT vendors often say "a GSA Schedule is your best sales tool for state government."

Example

A cybersecurity software company holds a GSA MAS contract with SIN 541519CDM (cybersecurity defense). A county government's IT director needs endpoint detection and response software for 3,000 county devices. Instead of issuing a county RFP (which would take 6+ months under county purchasing rules), the purchasing director verifies that: (1) the software company holds the relevant GSA Schedule SIN, (2) the product is in the IT category covered by cooperative purchasing, and (3) the county's purchasing code permits use of federal schedules. The county places a cooperative purchase order for $285,000 in software licenses and support. The order is processed under GSA Schedule terms; the vendor's GSA-negotiated pricing applies.

Frequently Asked Questions

Can all GSA Schedule categories be used for cooperative purchasing?

No. Cooperative purchasing for state and local governments is authorized only for specific categories under the E-Government Act: IT products and services, and security products and services (law enforcement, emergency response, physical security). Other GSA Schedule categories (facilities, human capital, management consulting) are NOT available for state/local cooperative purchasing.

Do state and local buyers need a separate agreement with GSA to use cooperative purchasing?

No formal registration or agreement with GSA is required. State and local buyers simply need to have legal authority under their own purchasing regulations to use federal schedules. Most states have enacted purchasing regulations or statutes recognizing cooperative purchasing from federal schedules. Some states require a formal cooperative purchasing agreement with another entity, for those states, the state's own cooperative purchasing program (like NASPO ValuePoint) may be the appropriate vehicle.

Are prices the same for state/local buyers as for federal buyers under cooperative purchasing?

Yes. State and local buyers receive the contractor's GSA Schedule pricing, which reflects the prices negotiated with GSA. The contractor cannot charge state/local cooperative buyers more than its GSA Schedule price. IFF applies: the contractor still pays 0.75% of cooperative purchasing sales to GSA as the industrial funding fee.

What is the difference between cooperative purchasing and piggybacking?

Both allow buyers to leverage existing contracts. Cooperative purchasing specifically refers to state/local use of federal contracts (primarily GSA Schedules). Piggybacking is a broader term often used for state and local buyers ordering off of other states' or cooperative purchasing organizations' (NASPO, Sourcewell) contracts. The mechanisms are different but serve similar efficiency purposes.