Intergovernmental Cooperative Purchasing

Intergovernmental cooperative purchasing is a procurement arrangement in which two or more government entities, which may be at different levels of government (state, county, city, school district) or in different states, jointly conduct a procurement or share access to the results of a procurement conducted by one of the parties.

What is Intergovernmental Cooperative Purchasing?

Intergovernmental cooperative purchasing enables government entities to pool their procurement resources, achieve economies of scale, reduce administrative costs, and access better pricing than any individual entity could obtain through independent competition. The arrangement is authorized by the Intergovernmental Cooperation Act of 1968 and by most state procurement statutes, which typically permit state and local entities to participate in contracts awarded by other governmental units.

The simplest form is a bilateral arrangement: two counties agree that County A will conduct the competitive procurement for shared IT services, and County B may purchase under the resulting contract at the same terms and pricing. More sophisticated arrangements involve formal cooperative purchasing networks with hundreds or thousands of member entities across multiple states, NASPO ValuePoint, OMNIA Partners, Sourcewell, and BuyBoard are examples.

Cross-jurisdictional purchasing, where a local government uses a contract awarded by an entity in a different state, requires both the purchasing entity's state law and the contract's own terms to authorize the arrangement. Not all state procurement statutes permit out-of-state piggybacking, so vendors should verify the legality of cross-state cooperative use before marketing a contract as nationally accessible.

Why Intergovernmental Cooperative Purchasing matters for government contractors

Vendors that win cooperative purchasing contracts effectively multiply their market reach without multiplying their proposal writing burden. Understanding which cooperative networks serve which geographic and entity-type segments allows vendors to target the highest-leverage vehicles for their product and service categories.

Example

Three mid-sized school districts in adjacent counties jointly draft an RFP for student information system software. District A serves as the lead procurement agency, conducts the competitive solicitation naming all three districts as potential users, and awards a contract with cooperative purchasing language. Districts B and C execute participating agreements and place orders under the contract, saving each district the time and cost of independent procurement and presenting a combined 85,000-student user base to competing vendors.

Frequently Asked Questions

What is the difference between intergovernmental cooperative purchasing and a joint venture?

Intergovernmental cooperative purchasing involves sharing the result of a competitive procurement, one entity buys under another's contract. A joint venture (in the procurement context) typically involves government entities jointly funding and managing a shared program or project, which is a different legal arrangement.

Does the lead agency take on liability for other entities' purchases?

Generally no. When other entities use a cooperative contract, they place orders directly with the vendor and are responsible for their own contractual relationship with the vendor. The lead agency's liability is typically limited to the procurement process it conducted.

Are federal entities allowed to use state cooperative contracts?

Federal entities may use state cooperative contracts in limited circumstances, but federal procurement law (the FAR) applies to federal purchases and has specific rules about using non-federal contracts. Federal agencies generally have their own contract vehicles (GSA Schedules, GWACs) and use state cooperative contracts only in narrow emergency or special circumstances.

How do I know if a state allows out-of-state cooperative purchasing?

Check the applicable state's procurement statute and attorney general opinions. NASPO publishes a state-by-state analysis of cooperative purchasing authority that identifies which states allow out-of-state piggybacking and under what conditions. This is essential due diligence before marketing a nationally scoped cooperative contract to purchasers in states that may not authorize such use.