MAIL BAG: When IS A STATE SALE CLASSIFED AS A COOPERATIVE PURCHASING TRANSACTION?
New reader M. Markle of California writes in “Our family-owned firm does business with California and other states. How do we know when a sale is a GSA Schedule Cooperative Purchasing sale versus a state government transaction?” We get this question more frequently than you would think, M. The situation can be confusing because state government customers often request that GSA contractors quote their Schedule price when bidding on state work. The key here, though, is to look at the actual purchasing instrument. Does it include the GSA Schedule contract number? Does the order say “Cooperative Purchasing” or “GSA Schedule” on it? If it wasn’t a Schedule purchase, what was it and how can that determination be supported by the order documentation? Conversely, is the instrument clearly a state government contract or other qualified purchase? Most states use the GSA Schedule price only as a reference price and then issue a purchase order that conforms with the relevant state acquisition rules. If there’s no mention of the Schedule contract number or any reference to GSA other than the original request to quote the Schedule price, it is likely that the state views the transaction as a non-GSA purchase. Contractors should also have a clear policy on what they consider to be Cooperative Purchasing sales versus other state business. It there is any doubt, contractors should absolutely ask for clarification. Failure to have a consistent policy or to have a clear understanding of what type of purchase is involved, can cause serious Schedule compliance issues for contractors. First, contractors must pay the Schedule IFF on Cooperative Purchasing orders, just as they would with a federal Schedule transaction. Second, offering deeper discounts to a state could trigger the Price Reductions Clause depending on what a company’s Basis of Award customer is. Having a consistent approach to this issue, and asking questions when there is uncertainty, can ensure that Cooperative Purchasing business is not a royal pain.