Will GSA schedule draw non-feds?

The federal government, after years of debate, is extending its buying power to state and local governments through a small provision in the E-Government Act of 2002, which Congress passed last month. But some observers disagree on whether the measure will have the effect Congress expects.

The bill, HR 2458, will let state and local agencies buy IT products and services off the General Services Administration's Federal Supply Service Schedule 70.

“Cooperative purchasing by state and local governments saves taxpayers money by allowing them to obtain discounts on commercial items that they could not achieve on their own because of the small volumes they buy,” said David Marin, spokesman for Rep. Tom Davis (R-Va.), who sponsored the legislation. “The benefits are clear: lower costs and more efficient and effective delivery of services.”

State and local governments will be able to take advantage of the federal government's volume discounts offered by 3,564 IT contractors.

“This gives us the ability to look at more solutions and more vendors,” said former Georgia CIO Larry Singer. “It shows that Tom Davis and members of Congress are thinking about state and local governments.”

Davis wanted to make sure state and local governments had the opportunity to get the best deals for IT, Marin said.

The state and local government IT market is worth about $10 billion to $12 billion annually, said Tom Davies, a senior vice president of Current Analysis Inc. of Sterling, Va., a market research firm.

In fiscal 2002, federal agencies spent more than $22 billion on schedule purchases, including $12 billion for IT products and services. This is up from $17 billion for all schedule purchases and $11 billion for IT in 2001.

Singer, who resigned as Georgia’s CIO earlier this month, said the provision will let federal, state and local governments collaborate more easily and set standards for technologies such as Web services.

“So often, there are times when we can collaborate, but it isn't thought of until late in the process,” Singer said. “With separate procurements, there is more of a chance for federal, state and local governments to buy incompatible systems. But buying off the schedules improves the opportunity to buy the same or similar technologies.”

Skills at bargain rates

Davies is less sure the provision will make much difference. He said many local and county officials already receive good prices for IT.

“The range of skills for IT services is the biggest advantage for state and local governments,” he said. “The one area where it might be advantageous might be with homeland security technologies because the federal government is leading the way.”

Olga Grkavac, executive vice president of the Information Technology Association of America in Arlington, Va., said the success of the provision will depend on how well GSA and vendors market the schedule to state and local governments.

Davis made cooperative purchasing a goal after it was removed from the Federal Acquisition Streamlining Act of 1994. He included the provision in the Services Acquisition Reform Act. But after SARA stalled in committee, Davis attached the cooperative purchasing provision to the E-Government Act.

Marin said Davis has no plans to push for an expansion of the provision beyond IT.

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