Piggyback contracts: when an agency buys rides off another agency's contract
Overview
A piggyback contract is a purchase made under another public agency's contract. A county, city or school district skips its own bid and buys rides from the vendor that another agency already selected through competition, at that contract's prices and terms. State law decides whether it is allowed, and federal grant rules treat a documented agreement as meeting competition.
On this page
What a piggyback contract is
A piggyback contract is a purchase made under a contract that another public agency awarded. A county, city or school district that needs rides skips its own bid and uses the contract a different agency already won through competition, at that contract’s prices and terms. Buyers also call it cooperative purchasing. For a ride company it can mean more work from a contract you already hold. It can also mean your price, set for one agency’s service area, gets used by another. The wider picture of how public buyers purchase is in government NEMT contracts.
When federal grant money pays
A state spending federal grant money follows the same procedures it uses for its own money, plus a few federal standards. A county or city follows the federal standards in 2 CFR 200.318 through 200.327 (2 CFR 200.317). Those standards encourage state and local intergovernmental agreements and inter-entity agreements for common or shared goods and services. They also say a documented procurement action of this type meets the competition requirements of the federal rules (2 CFR 200.318(e)). A transit agency spending federal transit money, as described in Section 5307, works under the same standards.
What state law can require
State statutes set their own conditions, and two examples show how different they are.
- Washington. Under the state’s interlocal cooperation chapter, an agency that buys through a bid, proposal or contract another public agency awarded has met its own competitive bidding duty if the awarding agency followed its own statutory requirements and also posted the solicitation notice on a website kept for public bid notices, or provided an access link on the state’s web portal (RCW 39.34.030(5)(b)). The posting is the condition a ride company can check.
- Florida. State agencies must, and “eligible users” may, buy commodities and contractual services from the purchasing agreements and state term contracts that the Department of Management Services sets up (section 287.056(1)). An eligible user is a person or entity the department has authorized by rule to buy from state term contracts (section 287.012). The statute names contractual services, not only goods. It also lets a buyer request quotes from a term contract vendor to test whether a better price, term or condition is available, so a state term contract price can be a starting point rather than the final price.
Whether your state allows piggybacking on service contracts, and on what conditions, is a question for the agency’s procurement office.
What to ask before you bid
Prices and terms travel with the contract, so ask the buyer these questions in writing before you set your price:
- Does the solicitation say other public agencies may buy under the resulting contract, and where was it posted?
- Would trips for another agency be longer or in a different service area than the original agency’s?
- Does the contract guarantee any volume, and would orders from other agencies count toward it?
- Which funds pay for each agency’s rides, and does that bring federal grant rules with it?
If you hold an IDIQ contract or a blanket purchase agreement, the same questions apply to how another agency’s orders would be placed. To research who holds a contract today, see how to find out who won a ride contract.
Frequently asked questions
- What does piggyback contract mean?
- It means one public agency uses a contract that a different agency awarded. The buying agency does not run its own bid. The vendor serves it under the original contract's prices and terms. People also call it cooperative purchasing. The rules for when it is allowed come from state procurement law, and from federal grant rules when federal money pays.
- Is it legal for an agency to piggyback on another agency's contract?
- It depends on the state and the kind of purchase. Washington's interlocal law treats the buyer's bidding duty as met when the awarding agency followed its own law and publicly posted the solicitation. Florida lets agencies the state authorizes as eligible users buy contractual services from state term contracts. Federal grant rules encourage documented agreements between governments.
- Does the second agency have to bid the work again?
- Not when the piggyback rules are met. Under 2 CFR 200.318(e), a documented procurement action that uses an intergovernmental or inter-entity agreement meets the competition requirements of the federal grant rules. State statutes set their own conditions, such as public posting of the original solicitation in Washington.
- Do my prices carry over to the other agency?
- Generally yes, because the other agency buys under the original contract. Florida shows the catch: an agency or eligible user can request quotes from a state term contract vendor to see whether a more favorable price, term or condition is available. If your service area or hours would not support the contract's prices for another agency, raise it before you bid.
- How do I know whether my contract can be piggybacked?
- Read the solicitation for wording that lets other public agencies use the contract, and see where the notice was posted. In Washington, the awarding agency's notice must be on a public website for bid notices or linked from the state portal. When in doubt, ask the contracting officer in writing before you submit your price.
