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SB 509

Purchasing and Procurement - As enacted, authorizes a local government to execute a cooperative purchasing agreement with other local, state, and federal governmental entities for purposes of purchasing materials, labor, and services used for maintenance, operations, component replacement, or repairs of existing facilities and grounds owned or operated by a local education agency or by a local government agency. - Amends TCA Section 12-3-1205.

114th Regular Session (2025-2026) Introduced by Page Walley

Allows local governments to use cooperative purchasing agreements for maintenance, repair, and operations MRO goods/services for LEAs and facilities, excluding construction.

Comp. became Pub. Ch. 98
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Bill Summary · SB 509

Summary of Bill: SB 509 (Session 114, Tennessee)

Title: Purchasing and Procurement - As enacted, authorizes a local government to execute a cooperative purchasing agreement with other local, state, and federal governmental entities for purposes of purchasing materials, labor, and services used for maintenance, operations, component replacement, or repairs of existing facilities and grounds owned or operated by a local education agency or by a local government agency. Amends TCA Section 12-3-1205.

Purpose and Intent

  • To authorize local governments to participate in cooperative purchasing agreements (CPAs) with other governmental entities (local, state, federal) for procuring certain goods and services.
  • Specifically targets materials, labor, and services used for maintenance, operations, component replacement, or repairs of existing facilities and grounds owned or operated by a local education agency (LEA) or by a local government agency.

Key Provisions

  1. Scope of Cooperative Purchasing Authority (CPA)

    • Local governments, utility districts, and other applicable entities may participate in, sponsor, conduct, or administer CPAs for procurement.
    • CPAs may involve one or more other local governments or, outside the state or with a U.S. agency, provided procurement is competitively bid.
    • The act is implemented under Tenn. Code Ann. § 12-3-1205(a)-(b).

  2. Exclusions from CPA Coverage (New text in 12-3-1205(b)(4)(B))

    • The following items are not eligible for purchase through a CPA:
      • Purchases of construction, engineering, or architectural services, or construction materials.
      • Excluded subcategories, specifically:
      • (i) Materials used in operation of a municipal utility system (e.g., transformers, conductors, insulators, poles, pipes, meters, etc.), whether purchased via a CPA with TVA or another arrangement.
      • (ii) Materials, labor, and services used for maintenance, operations, component replacement, or repairs of existing LEA or local government facilities and grounds (i.e., the very category targeted for CPA procurement in maintenance/repair, but not construction materials or related construction services).
  • In short: CPAs can be used for routine maintenance, operations, replacement, or repair materials/services for LEAs and local government facilities, but not for construction-related purchases or construction materials.

Affected Parties

  • Local governments (cities, counties, and possibly other political subdivisions) in Tennessee.
  • Local education agencies (LEAs) that own or operate facilities and grounds.
  • Potentially utility districts, and other governmental entities that participate in CPAs.
  • Vendors and contractors that supply maintenance, repair, and operations (MRO) materials and services to LEAs and local governments.

Procedural/Timeline Details

  • Effective Date: Takes effect upon becoming law, as stated (“the public welfare requiring it”).
  • Legislative history indicates standard Tennessee bill progression and eventual enactment as Chapter 98 (HB 546 / SB 509).

Fiscal Impact

  • Described as not significant.
  • Expected effects:
    • Possible administrative burden reduction for LEAs and local governments by avoiding separate bid processes for eligible MRO purchases.
    • Potential changes in costs, but anticipated to be at least on par with current procurement costs; actual savings uncertain.
    • Net local expenditure impact estimated as not significant.

Practical Implications and Considerations

  • Entities may realize streamlined procurement for maintenance/repair materials and services through CPAs, potentially increasing bargaining power and compatibility with existing purchasing practices.
  • Construction-related purchases remain outside the CPA framework, preserving traditional procurement methods for those categories.
  • Competitive bidding remains a central requirement for purchases through CPAs when outside state/federal partnerships, aligning with state procurement laws.

Summary

SB 509 amends Tennessee law to authorize local governments to participate in cooperative purchasing agreements to purchase maintenance, operations, replacement, and repair materials and services for LEAs and local government facilities. It expressly excludes construction, engineering, architectural services, and construction materials from CPA eligibility. The measure is intended to reduce administrative burden and potentially stabilize or optimize costs without creating significant new fiscal impact. The act takes effect upon becoming law.

Compiled from official sources — confirm details with the bill’s official record.

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