Cooperative Purchasing:

Effects Are Likely to Vary Among Governments and Businesses

GGD-97-33: Published: Feb 10, 1997. Publicly Released: Feb 10, 1997.

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Pursuant to a legislative requirement, GAO assessed the potential effects of a cooperative purchasing program administered by the General Services Administration (GSA) on nonfederal governments and federal agencies, and on industry, including small businesses and dealers.

GAO found that: (1) the potential effects of the cooperative purchasing program are likely to vary among state, local, and the Puerto Rican governments; (2) since participation is voluntary, these governments would use the schedules only if they perceived benefits from doing so; (3) most of the nonfederal entities GAO surveyed anticipated that they would participate; (4) although some of these governments may experience benefits, several factors may limit the extent of these benefits; (5) the program is likely to have little if any effect on Indian tribal governments because the schedules program is already available to them under separate authority; (6) if the GSA effectively implements its plan to exclude schedules from the program when adverse effects on federal agencies are indicated, there is little risk that the program will negatively affect the federal government, but whether it will have positive effects depends largely on whether increased use of the schedules by state and local governments would lead to lower prices and reduced administrative charges by GSA; (7) it is unclear at this time whether either of these would occur; (8) the potential effects of the cooperative purchasing program on industry, including small businesses and dealers, are also likely to vary, although sufficient data are not available to conclusively predict these effects; (9) some businesses, particularly GSA vendors, expect to benefit from increased sales or reduced administrative costs, while other businesses expect to lose sales or have lower profits; (10) still other businesses do not believe they will be affected by the program; (11) most of the concerns that businesses have expressed about significant adverse effects involve only a few GSA schedules; (12) GSA's plan to implement the cooperative purchasing program is still evolving; (13) in 1995, GSA published its initial approach and has been considering changes while implementation has been suspended; (14) GSA has not yet completed a more current, detailed plan, but such a plan would better enable Congress to weigh the merits of cooperative purchasing since so much depends on implementation decisions; (15) although the approach GSA has been considering appears reasonable in key respects, GAO believes a number of improvements would better position GSA to make decisions on making particular schedules available to nonfederal users; and (16) these improvements include the preparation of a written implementation plan and guidance to staff on factors to consider when making decisions.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: In 1998, Congress repealed the cooperative purchasing provisions of the Clinger-Cohen Act of 1996. Therefore, the recommendation no longer applies, even though GSA had agreed to implement the recommendation.

    Recommendation: As part of GSA's report on the cooperative purchasing program to Congress mandated by the Clinger-Cohen Act of 1996, the Administrator of General Services should provide a detailed plan setting forth the steps that GSA will take to implement the program. In particular, the Administrator's report should provide Congress with a written implementation plan that emphasizes the optional nature of the program and provides for evaluating the actual effects of decisions to open schedules, and a means for addressing the effects if the data so warrant.

    Agency Affected: General Services Administration

  2. Status: Closed - Not Implemented

    Comments: In 1998, Congress repealed the cooperative purchasing provisions of the Clinger-Cohen Act of 1996. Therefore, the recommendation no longer applies, even though GSA had agreed to implement the recommendation.

    Recommendation: As part of GSA's report on the cooperative purchasing program to Congress mandated by the Clinger-Cohen Act of 1996, the Administrator of General Services should provide a detailed plan setting forth the steps that GSA will take to implement the program. In particular, the Administrator's report should provide Congress with a written implementation plan that emphasizes the optional nature of the program and designates a high-level official or officials who are to make final decisions on opening schedules, especially when businesses express significant concern about potential adverse effects.

    Agency Affected: General Services Administration

  3. Status: Closed - Not Implemented

    Comments: In 1988, Congress repealed the cooperative purchasing provisions of the Clinger-Cohen Act of 1996. Therefore, the recommendation no longer applies, even though GSA had agreed to implement the recommendation.

    Recommendation: As part of GSA's report on the cooperative purchasing program to Congress mandated by the Clinger-Cohen Act of 1996, the Administrator of General Services should provide a detailed plan setting forth the steps that GSA will take to implement the program. In particular, the Administrator's report should provide Congress with a written implementation plan that emphasizes the optional nature of the program and identifies appropriate processes for obtaining and considering information and views from a full range of affected parties.

    Agency Affected: General Services Administration

  4. Status: Closed - Not Implemented

    Comments: In 1998, Congress repealed the cooperative purchasing provision of the Clinger-Cohen Act of 1996. Therefore, the recommendation no longer applies, even though GSA had agreed to implement the recommendation.

    Recommendation: As part of GSA's report on the cooperative purchasing program to Congress mandated by the Clinger-Cohen Act of 1996, the Administrator of General Services should provide a detailed plan setting forth the steps that GSA will take to implement the program. In particular, the Administrator's report should provide Congress with a written implementation plan that emphasizes the optional nature of the program and includes guidance that will be provided to GSA and Department of Veterans Affairs staff on the available quantitative data, affected parties' views, and other factors that need to be considered in assessing benefits and negative effects of opening up schedules.

    Agency Affected: General Services Administration

  5. Status: Closed - Not Implemented

    Comments: In 1998, Congress repealed the cooperative purchasing provisions of the Clinger-Cohen Act of 1996. Therefore, the recommendation no longer applies, even though GSA had agreed to implement the recommendation.

    Recommendation: As part of GSA's report on the cooperative purchasing program to Congress mandated by the Clinger-Cohen Act of 1996, the Administrator of General Services should provide a detailed plan setting forth the steps that GSA will take to implement the program. In particular, the Administrator's report should provide Congress with a written implementation plan that emphasizes the optional nature of the program and allows for partially opening schedules when appropriate.

    Agency Affected: General Services Administration

 

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