GSA sets rules for state schedule use

The General Services Administration last week published a much-anticipated proposed rule that for the first time would let state and local governments buy information technology using GSA schedule contracts, a practice known as cooperative purchasing.

The provision would be optional, not mandatory, and would be limited to Schedule 70 purchases — largely IT products and services. A public hearing is set for Feb. 4 at GSA headquarters, and the deadline for public comments is March 24.

The proposal, published in the Jan. 23 Federal Register, includes questionable measures intended to address the differences between states and federal agencies, said Jonathan Aronie, an attorney with the Washington, D.C., law firm Fried, Frank, Harris, Shriver and Jacobson.

The rule, for example, lays out a process in which a state or federal court, rather than the General Services Board of Contract Appeals, would resolve disputes between state agencies and contractors. That process could produce a less uniform set of interpretations of contracts, Aronie said.

The proposal also prevents states from modifying the terms of the schedule contracts, he said. "Almost every state has certain procurement regulations that by law they have to incorporate into a state contract," he said. "It puts the states in an awkward position."

Many vendors, however, are eager to see the rule implemented, he said. "When they are experienced in dealing with the GSA provisions, this is great for them, because they can avoid getting bogged down in a different state procurement regime."

Rick Grimm, chief executive officer of the National Institute of Governmental Purchasing, said the ability to buy through GSA would make state procurement more efficient.

"When items are bid competitively, you typically are not going to get a lower price" than GSA, he said.

But many states may be unable to use the option until their state legislatures change their laws, or states just may not be interested.

"The program we've got seems to be working just fine," said Ted Maddry, program manager at the Texas Building and Procurement Commission. Under a system launched last fall, Texas can use GSA pricing through GSA contractors, but under the authority of the state's own system — Texas Multiple Awards Schedules.

In Colorado, state law allows cooperative purchasing only if the state was part of the original competition among vendors, said purchasing director Kay Kishline. "It has to be truly cooperative. It doesn't mean just hopping onto something after the fact," she said.

Her department has spearheaded legislation that would loosen the restriction. Colorado makes many of its IT and other purchases through the Western States Contracting Alliance. Kishline said she would definitely consider using the GSA schedule if she could.

"I'd have to see the prices on this to see if they're better than the ones we're getting," she said. "It would certainly be a nice option to have." n

Definiiton: Cooperative purchasing was passed last year as part of the E-Government Act. It allows state and local governments to buy products and services using the General Services Administration's schedule contracts, which was previously prohibited.