The Interlocal Purchasing System (TIPS)

The Interlocal Purchasing System (TIPS) is a national cooperative purchasing program that allows public entities to purchase goods and services through competitively awarded contracts. It leverages collective buying power to streamline procurement and secure competitive pricing.

What Is The Interlocal Purchasing System (TIPS)?

Key Characteristics

National cooperative purchasing program

Contracts are competitively solicited and awarded

Available to public entities such as schools, municipalities, and government agencies

Vendors undergo a structured proposal and evaluation process

Designed to reduce procurement time and administrative burden

How It Works in Government Contracting

A city government needing construction services can use an awarded TIPS contract rather than running a separate local procurement. The city verifies compliance with state purchasing laws and issues a purchase order under the cooperative agreement.

Where it appears: TIPS is used during the purchasing stage after an agency identifies a need. Instead of issuing its own solicitation, the agency may purchase through an existing TIPS contract.

Who uses it: Public entities including school districts, state agencies, cities, counties, and certain nonprofit organizations use TIPS. Vendors participate after responding to TIPS solicitations and being awarded a contract.

Why it matters: It provides a compliant procurement pathway that saves time while maintaining competitive standards. Agencies can rely on pre-awarded contracts rather than conducting independent bidding.

Regulatory Framework

TIPS operates under interlocal cooperation authority granted by state procurement laws. Public entities must confirm that cooperative purchasing is permitted under their applicable state statutes.

While federal procurement regulations such as the Federal Acquisition Regulation govern federal agencies, TIPS primarily supports state and local government purchasing compliance requirements.

Why It Matters for Contractors

Business implications: TIPS provides access to a nationwide network of public entity buyers through a single awarded contract.

Compliance impact: Vendors must adhere to contract pricing, reporting, and performance requirements established in their TIPS agreement.

Strategic importance: Participation expands geographic reach without competing in separate solicitations for each public entity.

Risk considerations: Contractors must ensure pricing consistency, maintain performance standards, and comply with cooperative purchasing rules applicable in different states.

Common Misconceptions About TIPS

TIPS eliminates all procurement rules.

Public entities must still follow state and local purchasing requirements.

TIPS guarantees sales.

Awarded vendors gain access to buyers but are not guaranteed revenue.

Only schools can use TIPS.

Many public entities, including municipalities and government agencies, are eligible.

Frequently Asked Questions

Who can use TIPS contracts?

Public entities such as school districts, cities, counties, state agencies, and certain nonprofit organizations.

How does a vendor become a TIPS vendor?

Vendors must respond to a competitive solicitation issued by TIPS and meet qualification requirements.

Is membership required to use TIPS?

Eligible public entities typically register to access contracts, often at no cost.

Does TIPS replace competitive bidding?

TIPS contracts are competitively awarded. Public entities may use them in place of running their own solicitation if allowed by law.