Bill May Threaten Cooperative Purchasing in School Construction

A bill advancing in the General Assembly may threaten cooperative purchasing practices by school systems for construction and repair of school buildings. These cost-saving practices are intended to help the State keep pace with renovation and maintenance of aging school buildings.

According to the Department of Legislative Services, Board of Public Works regulations currently require local school systems to use competitive sealed bidding in procuring school construction contracts in general. One exception is that they may use specified forms of intergovernmental cooperative purchasing if they determine that it:

  1. Will provide cost benefits, promote administrative efficiencies, or promote governmental cooperation and
  2. Is not intended to avoid competition

Providing small county school boards the opportunity to piggyback on contracts of larger county schools boards allows them to attain economies of scale that would be otherwise out of reach. Cooperative purchasing groups such as the Eastern Shore of Maryland Educational Consortium (ESMEC) can coordinate procurements by their nine eastern shore school system members to the benefit of their members and ultimately, the taxpayer.

SB 515 County Boards of Education – Procurements for Construction or Repair of School Projects, would trigger competitive purchasing laws and regulations every time a school system seeks to make a school building repair or complete a school construction project using $25,000 or more of state capital funding.

The Maryland Association of Boards of Education has opposed SB 515, stating that,

  • $25,000 in state capital funding should not bar the use of intergovernmental cooperative purchasing, or piggybacking, for school construction projects.
  • Large and small school systems rely on piggybacking to save time and money and benefit from the staff work done in another system.
  • Taxpayers benefit from the cost savings school systems are achieving under the current law.
  • This bill would interfere with school system efforts to achieve cost savings and efficiencies.
  • Board of Public Works regulations clearly allow “intergovernmental cooperative purchasing” and “piggybacking” to provide cost benefits, administrative efficiencies, and promote governmental cooperation (COMAR 23.03.03.12).

When passed by the Senate, SB 515 will advance to the House. The House crossfile of the legislation, HB 330 has not advanced.