Policy Analysis | June 2015

State Purchasing Regulations and Reform

Sujit CanagaRetna

States across the country continue to explore strategies to lower overall spending while providing citizens with critical services. In this connection, reforming their purchasing regulations and introducing procurement reforms remain a strong management feature in a number of states. In fact, given their reputation as the laboratories of democracy, many states have introduced innovative and creative ways with regard to their procurement processes by utilizing new tools and establishing best practices.

Four such states are Georgia, Virginia, Minnesota and Wisconsin, which, in recent years have enacted some significant and successful procurement reform efforts in a number of their state agencies that possibly could be adopted in other settings. Georgia and Virginia have enhanced their procurement systems to optimize savings and spending potential by adopting e-procurement tools and emulating successful procedures from the private sector. Similarly, Minnesota and Wisconsin have made groundbreaking strides in procurement reform by sharing resources, consolidating services and pursuing joint contracts.

"Nothing is simple when it comes to government contracting, especially for large technology projects. Yes, there are good reasons for having all those checks and balances in place. After all, taxpayers foot the bill for these projects, and there must be some assurance that the funds are being spent wisely, particularly given some of the high-profile failures of public-sector IT deployments. But the downside is these rules can be so restrictive that they choke off competition and innovation."1 More about some of the factors that stifle competition can be found here.

In Washington, a new state law went into effect on January 1, 2013, that consolidated procurement laws under the state's Department of Enterprise Services. The goal of the new law is to make the procurement process more transparent, competitive and efficient. Additional information about this law can be found here.

The National Institute of Governmental Purchasing's (NIGP) Institute for Public Procurement is an entity focused on heightening efficiencies in the procurement process. As NIGP notes, "public procurement gains increasing respect through each individual's ongoing commitment and adherence to best practices, ethical values and public service. To this dedicated community, NIGP provides ground-breaking professional development programs to government procurement professionals throughout the world." NIGP has been promoting global best practices in public procurement and additional information about these proposals can be found here.

The National Association of State Procurement Officials (NASPO), established in 1947, in Chicago, Illinois, is "a non-profit association dedicated to advancing public procurement through leadership, excellence, and integrity. It comprises the directors of the central purchasing offices in each of the 50 states, the District of Columbia and the territories of the United States. NASPO is an organization that helps its members achieve success as public procurement leaders through promotion of best practices, education, professional development, research, and innovative procurement strategies."

The following are good sources highlighting innovation across a spectrum of service areas:

  • The 2014 Survey of State Procurement Practices, which was administered to central procurement offices in 50 states, the District of Columbia, and Puerto Rico with a response rate of 94 percent (July 2014)
  • Top 10 Focus Areas for State Procurement (February 2015)
  • Non-Competitive/Sole Source Procurement: Seven Questions (January 2015)
  • Paper highlighting the value that state procurement professionals bring to state government, focusing on ways in which procurement generates state savings, creates and sustains private sector jobs, and ensures state procurement integrity. It also includes a discussion on how state executive leadership can help support state procurement's ability to add value to states. (June 2013)
State programs from the SLC region recently recognized with NASPO awards:
1. Justine Brown, Contributing Writer, for Government Technology, November 8, 2011, http://www.govtech.com/pcio/articles/5-Government-Procurement-Practices-That-Stifle-Innovation.html.