• Interlocal Agreements – Purchasing Cooperatives
  • December 1, 2017 | Author: Eric Enoch Munoz
  • Law Firm: Eichelbaum Wardell Hansen Powell & Mehl, P.C. - Austin Office
  • Interlocal agreements received a publicity boost earlier this year due to the Texas Attorney General’s ruling that a school district may not operate a transportation system (for taking students to and from school) outside its boundaries unless it enters into an “interlocal contract as provided by Chapter 791, Government Code.” Interlocal agreements are a common occurrence for school districts. They are the primary way in which districts formalize arrangements with other local government entities.

    The Interlocal Cooperation Act provides that a local government may “contract or agree with another local government…to perform governmental functions and services[.]”[1] An interlocal agreement must be authorized by the governing body of each party to the contract.[2] The Act further requires that an interlocal agreement state the purpose, terms, rights, and duties of the contracting parties, as well as specify that each party paying for the performance of governmental functions or services must make those payments from current revenues available to the paying party.[3]

    A purchasing cooperative is likely to be organized as an interlocal agreement between different entities. Remember that an “interlocal agreement” is an authorized method of delivery for certain purchases over $50,000 pursuant to the Texas Education Code. The law contains explicit requirements. For example, an interlocal contract between a governmental entity and a purchasing cooperative may not be used to purchase engineering or architectural services.”[4]

    Check with the school’s attorney to ensure that an interlocal agreement is an allowable procurement method. It can be a tricky question—especially in construction.

    Additionally, if a district finds itself purchasing construction-related goods or services through an interlocal purchasing cooperative, the law requires (for purchases over $50,000) that a person designated by the school district certify in writing that either (1) plans and specifications required under Chapters 1001 (engineering) or 1051 (architecture) of the Occupations Code have been prepared, or (2) the project does not require the preparation of plans and specifications under those statutes.

    [1] Tex. Gov't Code Ann. § 791.011 (West 2017).

    [2] Id.

    [3] Id.

    [4] Id. at subsection (h).