Michigan

Plain-language summary

Michigan's framework for cooperative purchasing is broadly permissive and constitutionally grounded. Article VII, Section 28 of the Michigan Constitution authorizes the legislature to authorize 'two or more counties, townships, cities, villages or districts, or any combination thereof' to enter cooperative agreements, share costs, transfer functions, and cooperate with one another and with state government. Article III, Section 5 expands this authority. The Urban Cooperation Act of 1967 (MCL §§124.501 to 124.512) implements this constitutional authority and is one of the most permissive interlocal cooperation statutes in the country. Public agencies may enter interlocal agreements to 'jointly exercise any power, privilege, or authority that the agencies share in common and that each might exercise separately.' Critically, 'public agency' is defined broadly to include political subdivisions of Michigan, political subdivisions of other states, agencies of the United States, federally recognized Indian tribes, and similar entities. At the state procurement level, MCL §18.1261 (Management and Budget Act) authorizes Michigan's Department of Technology, Management and Budget to handle state agency procurement. Subsection (7) explicitly authorizes the department to 'enter into a cooperative purchasing agreement with 1 or more other states or public entities for the purchase of goods, including, but not limited to, recycled goods, and services necessary for state programs.' Subsection (9) sets a state goal of awarding 'not less than 5% of its total expenditures for construction, goods, and services to qualified disabled veterans' — confirming that construction is within the procurement chapter's scope.

Key requirements

• →Constitutional authority: Mich. Const. Art. VII, §28 authorizes the legislature to enable cooperative agreements among counties, townships, cities, villages, or districts and with the state.
• →Urban Cooperation Act of 1967 (MCL §§124.501 to 124.512) permits public agencies to enter interlocal agreements to jointly exercise any common power, privilege, or authority.
• →Public agency definition under §124.502 includes political subdivisions of Michigan, political subdivisions of other states, agencies of the United States, federally recognized Indian tribes, and Canadian political subdivisions.
• →Interlocal agreements must be in writing and approved by the legislative body of each participating public agency.
• →MCL §18.1261(7): the state Department of Technology, Management and Budget may enter cooperative purchasing agreements with one or more other states or public entities for goods and services.
• →MCL §18.1261(9) treats construction as within the state procurement chapter's scope (5% disabled veteran goal for 'construction, goods, and services').
• →Michigan public construction projects must comply with applicable competitive bidding statutes, prevailing wage requirements, and bonding requirements.
• →Local units of government may use cooperative purchasing through joint powers agreements under the Urban Cooperation Act of 1967.

Construction services

Michigan's Urban Cooperation Act of 1967 is one of the model interlocal cooperation statutes in the country and provides broad authority for cooperative construction arrangements. The statute's expansive definition of 'public agency' — including political subdivisions of other states — makes it well-suited for Michigan public agencies to participate in national cooperative purchasing programs like OMNIA Partners and Region 14 ESC Texas. The state procurement framework under MCL §18.1261 treats construction as within the procurement chapter's scope (per the §18.1261(9) disabled veteran goal language), and §18.1261(7) provides explicit state-level cooperative purchasing authority. Michigan public agencies considering cooperative construction procurement have a workable framework — they should verify with counsel that the specific cooperative contract was competitively procured and that the use case satisfies Michigan's public construction bidding, prevailing wage, and bonding requirements.