NIGP Buy Weekly - 04/18/2007

Marking its 10-year anniversary, U.S. Communities Government Purchasing Alliance reports savings for counties, cities, schools, and non-profit organizations across the country of $735 million on $5 billion in purchases including 2007 estimates.

U.S. Communities provides a money-saving national purchasing forum for local and state government agencies, school districts (K-12), higher education and non-profits nationwide by pooling the purchasing power of over 87,000 public agencies in the U.S. and Canada. The alliance was founded in 1996 by the National Association of Counties (NACo), the United States Conference of Mayors (USCM), the National Institute of Governmental Purchasing (NIGP), the National League of Cities (NLC) and the Association of School Business Officials (ASBO).

The cumulative savings were immediate and have grown steadily since the purchasing alliance was implemented:

U.S. COMMUNITIES SAVINGS

YEAR	DOLLAR AMOUNT
1997	$3 million
1998	$8 million
1999	$16 million
2000	$29 million
2001	$34 million
2002	$48 million
2003	$53 million
2004	$74 million
2005	$108 million
2006	$152 million

Officials estimate that U.S. Communities will generate
$210 million in saving this year.

According to Rick Grimm, CEO, NIGP, and Chair of the U.S. Communities Board of Directors, U.S. Communities was born of the need for local agencies to find more efficient ways to purchase commodities and services. This was never more apparent than in 1996 when Congress decided to close Federal General Services Administration schedules to local agencies. In an effort to bring efficiencies and savings to local governments, the idea of a national buying cooperative took hold.

“While we suspected it would be successful, the savings, purchasing power and reach of the alliance has far exceeded our expectations,” Grimm said. “In 2006 alone, savings of $150 million were documented on purchases exceeding $1 billion. Today more than 20,000 public agencies are registered and participating in the program.”

Supervisor Gerry Hyland, Fairfax County, Virginia, a founding partner of the alliance and an original member of the Advisory Board, said using the U.S. Communities program has “saved Fairfax County millions of dollars in purchases on a plethora of products including office and school supplies, computer products, office furniture, and industrial supplies.”

Hyland cited the office and school supply program as a prime example of savings.

“By using the existing contract under Los Angeles County, Fairfax County saved more than $1.6 million in fiscal year 2006 on these supplies,” Hyland said. “That $1.6 million a year plus significant savings from other alliance contracts allows us to fund other vital county services without having to ask for additional taxpayer assistance.”

Nancy Locke, Purchasing Manager, Seattle, Washington, advised the city has taken full advantage of the number of offerings through U.S. Communities, including office supplies, technology solutions, janitorial supplies, maintenance and repair supplies, and playground equipment.

“In 2006 we estimate our total savings at more than $350,000,” Locke said. “In addition, the City of Seattle was able to piggyback on contracts and free our staff to work on more complicated solicitations for the city.”

Darren Muci, Director of Operations, Wichita Public Schools, said, “Using the expertise of the school team members of U.S. Communities we have been able to build significant savings and improvements in the school product offerings.”

Hyland said the soft dollar savings are as significant as the hard dollar savings. He again cited the Los Angeles County school supply contract as an example.

“In addition to hard dollar savings are process or soft savings,” Hyland said. “We no longer warehouse office and school supplies because the Los Angeles County contract requires ‘just-in-time’ delivery to our work sites. We no longer have to spend money on the bidding process because Los Angeles County incurred those costs on behalf of all users of the program.”

Primary advantages of the purchasing alliance include:

• Competitively solicited contracts by a lead public agency
• Most favorable public agency pricing
• No cost to participate
• Nationally sponsored by leading associations and purchasing organizations
• Broad range of high quality products
• Aggregates purchasing power of public agencies nationwide
• Managed by public purchasing professionals.

For more information, visit www.uscommunities.org.