State Purchasing Schedules
Subject: State Purchasing Schedules
Date: July 11, 2013
Through this Regional Advisory, the Federal Transit Administration (FTA) would like to take the opportunity to reiterate its procurement rules pertaining to State purchasing schedules. In light of FTA’s recent review of the Minnesota Cooperative Purchasing Venture (CPV), FTA has taken the position that grantees located outside of a State’s borders are not permitted to purchase from that State’s schedule.
Recipients of FTA financial assistance are required by both 49 U.S.C. § 5325(a) and the common grant rule (49 C.F.R. § 18.36(c)) to use full and open competition when making purchases. Typically, when purchasing vehicles, a grantee fulfills this requirement by one of four procurement methods: (1) conducting a stand-alone procurement for a finite number of vehicles; (2) jointly procuring a finite number of vehicles with one or more grantees; (3) accepting the assignment of another grantee’s contractual right to purchase a finite number of vehicles (aka “piggybacking”); and (4) utilizing state purchasing schedules.
For reasons of federalism, States are accorded substantial deference under the common grant rule at 49 C.F.R. § 18.36(a) in the policies and procedures used in state procurements. By this authority, a State may follow the same policies and procedures it uses for procurements from its non-Federal funds, so long as it ensures that every purchase order or other contract includes any clauses required by Federal law. Many States use this authority to create purchasing schedules by which the State and its subsidiaries may acquire goods.
Principles of federalism limit State powers, too. FTA grantees located outside a State’s borders are not permitted to purchase from that State’s schedule. Joint procurements (and in limited circumstances piggybacking) are the only forms of FTA-funded contracts permitted among grantees from different states.
Please contact the Region 8 office at 720-963-3300 if you have any questions. More information can be found in FTA guidance in circular 4220.1F http://www.fta.dot.gov/documents/C_4220.1F.pdf.
Linda M. Gehrke