Transit Agency Intergovernmental Agreements: Common Issues and Solutions (2012)

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4 II. STATE CONSTITUTIONAL AND STATUTORY ENABLING AUTHORITY A. Types of Enabling Statutes Approximately 42 states authorize the use of coop- erative IGAs.8 Of the 31 transit agencies responding to the survey that are using IGAs and MOUs, 25 agencies replied that their state’s law specifically allowed such agreements to be used. In addition, most states author- ize municipalities to exercise “home rule” powers, meaning that “a municipality may usually take an ac- tion unless it is specifically prohibited or ‘preempted.’”9 Fourteen transit agencies responding to the survey also reported that cities in their state had home rule power pursuant to which they could enter into IGAs, MOUs, or similar joint arrangements.10 As one source notes, “[a]ll intergovernmental cooperative efforts operate against a backdrop of state enabling authority. The pos- sible sources of authority are wide-ranging, and may include a state constitutional provision, municipal home rule powers, a general state statute enabling intergov- ernmental cooperation, or a specific enabling act for a particular type of intergovernmental action.”11 Al- though there is some uniformity among the states’ ena- bling provisions for IGAs, the constitutional provisions and enabling statutes vary considerably. State constitutional provisions and enabling statutes that authorize agreements between or among govern- mental units and other parties refer to the agreements as IGAs,12 joint exercise or joint exercise of powers 8 United States Advisory Commission on Intergovernmental Relations, State Laws Governing Local Government Structure and Administration 26–27 (U. S. Advisory Commission on In- tergovernmental Relations 1993), hereinafter cited as “Advi- sory Commission.” 9 Illinois Municipal League Home Rule, Municipal Hand- book 13, ch. 2 (Nov. 15, 2011), available at http://www.iml.org/ file.cfm?key=6056. 10 The responding agencies cited: ARK. CONST. amend. 55; CAL. CONST. art. XI, § 5; S.F. Charter, art. VIIIA, § 8A.102(b)(1); S.F. Adm. Code, ch. 21, § 21.16; FLA. STAT. § 166.021 (the transit agency stating that the section “implic- itly includes interlocal and other joint agreements”); ILL. CONST. 1970 art. VII, §§ 6 and 10; N.C. GEN. STAT. § 160A-460, et seq.; OHIO REV. CODE § 735.053; UTAH CODE ANN., Interlocal Cooperation Act, tit. 11, ch. 13; WASH. REV. CODE § 39.34. 11 Laurie Reynolds, Intergovernmental Cooperation, Metro- politan Equity, and the New Regionalism, 78 WASH. L. REV. 93, 119–22 (2003) (footnotes omitted), hereinafter cited as “Rey- nolds.” 12 COLO. REV. STAT. § 24-46.5-103 (intergovernmental agreements); ILL. CONST. art. VII § 10; 5 ILL. COMP. STAT. 220/2 (Intergovernmental Cooperation Act); N.Y. Exec. Law § 107 (McKinney 2011); OKLA. STAT. ANN. § 74-1001); MICH. CONST. art. VII § 28; MICH. COMP. LAWS § 124.2; MINN. STAT. § 471.59, subd. 1; MO. REV. STAT. § 70.220; NEB. CONST. art. XV § 18; N.Y. CONST. art. IX §§ 1 and 1(c); OKLA. STAT. ANN. § 74-1001; OHIO REV. CODE ANN. §§ 167.01, 167.03A(2) and (4); VT. STAT. ANN., tit. 24 § 4901(a); WASH. REV. CODE ANN. agreements,13 or interlocal agreements,14 all of which will be referred to in the digest as IGAs. As authorized by Idaho’s statute, “[a]ny state or public agency may enter into agreements with one another for joint or co- operative action which includes, but is not limited to, joint use, ownership, and/or operation agreements pur- suant to the provisions of this act.”15 Furthermore, [a]ny power, privilege or authority, authorized by the Idaho Constitution, statute or charter, held by the state of Idaho or a public agency of said state, may be exercised and enjoyed jointly with the state of Idaho or any other public agency of this state having the same powers, privi- lege or authority; but never beyond the limitation of such powers, privilege or authority….16 Although transit and other agencies use MOUs, no enabling acts were located that refer specifically to MOUs. Without a provision in an MOU stating that it is a binding, enforceable agreement, the case law is clear that an MOU is not a binding agreement; it is “merely an agreement to agree, and not a contract that could be breached or rescinded.”17 Thus, in a case involving two MOUs in connection with a business transaction, a California court found that the MOUs failed to provide any basis for the plaintiff’s claims for breach of con- tract, rescission, unjust enrichment, or promissory es- toppel.18 Although a party’s actions after the execution § 39.34.030(1); W. VA. CODE § 8-23-3; WIS. STAT. ANN. §§ 66.0301 and 66.0303(2). 13 ARIZ. REV. STAT. ANN. § 11-952.02 (joint exercise of pow- ers); CAL. GOV’T CODE § 6500.1 (Joint Exercise of Powers Act); IDAHO CODE § 67-2328(b); IND. CODE § 36-1-7-1; IOWA CODE §§ 28.E.1 and 28E.3; ME. REV. STAT. ANN. tit. 30 § 2203; MASS. GEN. LAWS ANN. ch. 40 § 4A; MINN. STAT. § 471.59, subd. 1; MISS. CODE ANN. § 17-13-7; MONT. CODE ANN. § 67-11-203(3); NEB. REV. STAT. §§ 3-221 and 13-2505 (Joint Public Agency Act); NEV. REV. STAT. § 277.110; N.M. STAT. ANN. § 11-1-2 (Michie 2011) (Joint Powers Act); N.D. CENT. CODE § 54-40.3- 01 (Joint Powers Agreements); S.C. CONST. art. VIII § 13(A) (“Any county, incorporated municipality, or other political sub- division may agree with the State or with any other political subdivision for the joint administration of any function and exercise of powers and the sharing of the costs thereof.”); S.C. CODE ANN. § 11-35-4810 (authorizing cooperative purchasing agreements); S.D. CODIFIED LAWS ANN. § 1-24-1, et seq. (au- thorizing joint exercise of powers); VT. STAT. ANN. tit. 24 § 4901(1). 14 CONN. GEN. STAT. § 7-339a; FLA. STAT. §§ 163.01(1) and (5) (Florida Interlocal Cooperation Act of 1969); KAN. STAT. ANN. § 12-2904 (interlocal agreements by public agencies); IND. CODE § 36-1-7 (interlocal cooperation); KAN. STAT. ANN. § 12-2904(a); MICH. COMP. LAWS §§ 124.502 and 505; NEB. REV. STAT. § 13-802 (Interlocal Cooperation Act); NEV. REV. STAT. § 277.080 (Interlocal Cooperation Act); N.C. GEN. STAT. § 160A-460 (interlocal cooperation; joint exercise of powers); R.I. GEN. LAWS § 45.40.1-4; TENN. CODE ANN. § 12-9-104; TEX. GOV’T CODE ANN. § 791-001; UTAH CODE ANN. § 11-13-2. 15 IDAHO CODE § 67-2328(b). 16 Id. § 67-2328(a). 17 Waldner v. Carr, 618 F.3d 838, 846 (8th Cir. 2010). 18 Id. at 847–48. See also Whalen v. Connelly, 545 N.W.2d 284, 293 (Iowa 1996) (stating that “[a] contract is however

5 of an MOU may be relevant in interpreting an MOU, the party’s actions are not relevant to establish that a binding agreement has been made.19 B. Purpose of Enabling Laws The purpose of the enabling laws for IGAs is “to per- mit local governmental units to make the most efficient use of their powers by enabling them to cooperate with other localities…to provide services and facilities in a manner and pursuant to forms of governmental organi- zation that will accord best with…the needs and devel- opment of local communities.”20 The states’ intent is “to increase the efficiency and effectiveness of local gov- ernments by authorizing them to contract, to the great- est possible extent, with one another and with agencies of the state.”21 Many of the acts also are clear that the laws are to be construed liberally.22 An Illinois court has stated that “when local governments cooper- ate…the courts are not to strictly construe the statutory grants of authority under which they act.”23 C. Duration of IGAs Most states leave it to the parties to decide on the duration or term of an IGA. Indeed, some enabling laws provide that unless restricted by the agreement, the duration of an IGA is unlimited or perpetual.24 However, some states’ statutes limit an IGA’s dura- tion.25 As a Georgia court has observed, under Georgia law ordinarily a municipal government may not enter into a contract that lasts longer than that government's term of office so that one council may not bind itself or generally not found to exist when the parties agree to a con- tract on a basis to be settled in the future”) (citing Air Host Cedar Rapids v. Airport Comm'n, 464 N.W.2d 450, 453 (Iowa 1990); Faught v. Budlong, 540 N.W. 2d 33, 35–36 (Iowa 1995)). 19 Waldner, 618 F.3d at 846. 20 KAN. STAT. ANN. § 12-2901. 21 TEX. GOV’T CODE § 791.001. See also ME. REV. STAT. tit. 30, § 2201; N.H. REV. STAT. ANN. § 53-A:1; UTAH CODE ANN. § 11-13-2. 22 IOWA CODE § 28E.1; ME. REV. STAT. ANN. tit. 30-A § 2203(7); NEB. REV. STAT. §§ 13-827 and 13-2550; N.Y. GEN. MUN. LAW art. 14-G § 473; WIS. STAT. § 66.0301(2). 23 County of Wabash v. Partee, 241 Ill. App. 3d 59, 67, 608 N.E.2d 674, 679–80 (Ill. App. 1993). 24 CAL. GOV’T CODE § 6510 (providing that the agreement may be continued for a definite term); FLA. STAT. ANN. § 163.01(5)(b); IND. CODE § 36-1-7-3(a)(1); ME. REV. STAT. ANN. tit. 30-A § 2203(2)(a); MISS. CODE ANN. § 17-13-9(a); N.H. REV. STAT. ANN. § 11-1-4(E); N.Y. GEN. MUN. LAW art. 14-G § 466(1); N.C. GEN. STAT. § 160A-461 (“reasonable duration”); N.D. CENT. CODE § 54-40.3-01(1)(b); OR. REV. STAT. § 190.020(e) (may be perpetual); WIS. STAT. ANN. § 66.0301(2) (duration authorized for the period of time stated in the agree- ment); W.VA. CODE § 8-23-3 (same). 25 ALA. CODE § 11-102-2 (authorizing a 3-year term renew- able for 3 years); CONN. GEN. STAT. § 7-339(f) (not to exceed 40 years); GA. CONST. art. IX, § III, para. 1(a) (not to exceed 50 years); MASS. GEN. LAWS ANN. ch. 40, § 4A (not exceeding 25 years). its successors “so as to prevent free legislation in the matters of municipal government.”26 However, political subdivisions in Georgia are allowed to contract with one another or with public agencies as long as the term of the agreement does not exceed 50 years.27 If an agreement is concluded that violates a state limitation on the duration of an IGA, it may be possible to avoid invalidating the agreement by severing the durational provision. In an Iowa case involving an IGA imposing a 24-year moratorium that was invalid under Iowa Code Section 368.4, the court severed the 24-year provision from the agreement rather than invalidate the agreement.28 D. Mutuality of Powers Requirement The states’ enabling authority for IGAs takes one of two approaches. The first approach and the one that is most evident is the “mutuality of powers” approach. The approach permits agencies to enter into collaborative agreements as long as each agency that is a party to the agreement possesses the authority to exercise the ser- vice or function being undertaken pursuant to the agreement. For example, Colorado’s Constitution pro- vides that [n]othing in this constitution shall be construed to pro- hibit the state or any of its political subdivisions from co- operating or contracting with one another or with the government of the United States to provide any function, service, or facility lawfully authorized to each of the coop- erating or contracting units, including the sharing of costs, the imposition of taxes, or the incurring of debt.29 [Emphasis added.] Furthermore, Colorado’s enabling statute provides that [g]overnments may cooperate or contract with one an- other to provide any function, service, or facility lawfully authorized to each of the cooperating or contracting units, including the sharing of costs, the imposition of taxes, or the incurring of debt, only if such cooperation or contracts are authorized by each party thereto with the approval of its legislative body or other authority having the power to so approve.30 [Emphasis added.] Thus, in most states, the enabling laws authorize the state, its agencies and political subdivisions, munici- palities, and other governmental units to enter into written agreements for the joint exercise of any power 26 GREENE COUNTY SCH. DIST., 278 Ga. 849, 850, 607 S.E.2d, 881, 882 (footnotes omitted), (citing GA. CONST. art. IX, § III ¶ I (a)). 27 Id. (citing GA. CONST. art. IX, § III ¶ I (a)). 28 Heintz v. City of Fairfax, 2007 Iowa App. LEXIS 241 (Ct. App. Iowa filed and affirmed Feb. 28, 2007). 29 Durango Transp., Inc., 824 P.2d 48, 49–50 (Colo. Ct. App. 1991) (quoting COLO. CONST. art. XIV, § 18(2)(a)). 30 Id. at 50 (quoting COLO. REV. STAT. § 29-1-203(1) (1986 Repl. vol. 12A)).

6 or service that each agency that is a party to the agreement is authorized to exercise individually.31 As held by an Illinois court, governmental units may exercise only those powers granted to them by the state constitution or by statute, together with such implied powers as are essential to carry out their express pow- ers.32 A power to cooperate intergovernmentally may 31 ALA. STAT. § 11-102-1; ALASKA CONST. § 10.13 (stating that “[a]greements, including those for cooperative or joint administration of any functions or powers, may be made by any local government with any other local government, with the State, or with the United States, unless otherwise provided by law or charter”); ARIZ. STAT. § 11-952; ARK. STAT. §§ 19-11-206 and 207 (applicable to every expenditure of public funds by the state); ARK. STAT. § 25-20-104(a) (“which has the same powers”); ARK. STAT. § 25-20-104(b); CAL. GOV’T CODE § 6502; COLO. CONST. art. 14, §§ 18(1)(b) and (c) and 2(a), provid- ing that [n]othing in this constitution shall be construed to prohibit the state or any of its political subdivisions from cooperating or contracting with one another or with the government of the United States to provide any function, service, or facility law- fully authorized to each of the cooperating or contracting units, including the sharing of costs, the imposition of taxes, or the in- curring of debt. CONN. GEN. STAT. § 7-148cc (“Two or more municipalities may jointly perform any function that each municipality may per- form separately….”); CONN. GEN. STAT. § 7-339b(a)(1) (permit- ting interlocal agreements for “transportation services”); FLA. STAT. § 163.01(4); GA. CONST. art. IX § III ¶ 1(a); IND. CODE § 36-1-7-2(a) A power that may be exercised by an Indiana political subdi- vision and by one (1) or more other governmental entities may be exercised: (1) by one (1) or more entities on behalf of others; or (2) jointly by the entities. Entities that want to do this must, by ordinance or resolution, enter into a written agreement under section 3 or 9 of this chapter. IDAHO CODE § 67-2328(a) and (b); 5 ILL. COMP. STAT. 220/3; IOWA CODE § 28E.3; KAN. STAT. ANN. §§ 12-2904(a) and 2908(b); KY. REV. STAT. ANN. § 65.240; LA. CONST. art. 7.14(C); MD. CODE ANN. STATE, FIN. & PROC. § 13-110 (intergovernmen- tal cooperative purchasing agreement); MASS. GEN. LAWS ANN. ch. 40 § 4A; MICH. CONST. art. 7, § 28; MICH. COMP. LAWS §§ 124.2 and 124.504; MISS. CODE ANN. § 17-13-7(5); MO. REV. STAT. § 70.220(1); NEB. CONST. art. 7, § 28; NEB. REV. STAT. § 13-2505; NEV. REV. STAT. § 277.180(2)(a) (applicable to contract involving foreseeable expenditure of more than $25,000); N.H. REV. STAT. ANN. § 53-A:3; N.Y. CONST. art. IX, § 1(c); N.C. GEN. STAT. 160A-461; N.D. CENT. CODE § 54-40.3-01; OHIO REV. CODE ANN. §§ 167.01 and 167.03(A)(2); OKLA. STAT. ANN. § 74-1004; OR. REV. STAT. § 190.010; R.I. GEN. LAWS § 45-40.1- 4; S.D. CODIFIED LAWS ANN. § 1-24-2 (authorizing joint exer- cise of powers pursuant to which [a]ny power or powers, privileges, or authority exercised or capable of exercise by a public agency of this state may be exer- cised and enjoyed jointly with any other public agency…to the extent that the laws of such other state or of the United States permit such joint exercise or enjoyment. TENN. CODE ANN. § 12-9-104; TEX. GOV’T CODE ANN. §§ 11-13-4 and 791.011(b) and (g); VT. STAT. ANN. tit. 24 § 4901(a); WASH. REV. CODE §§ 39.34.030(1) and (2); W. VA. COde § 8-23-3; WIS. STAT. ANN. § 66.0303(2). 32 Rajterowski v. City of Sycamore, 405 Ill. App. 3d 1086, 1121, 940 N.E.2d 682, 710 (2010). not be used to authorize an agreement that contravenes statutory prohibitions or limitations that apply to the participating entities.33 An enabling statute does not necessarily empower “the State and its institutions and subdivisions to enter into any and every contract which they might in their discretion deem advisable.”34 An IGA must relate to the provision of services or the joint or separate use of facilities or equipment and must deal with activities, services, or facilities that the contract- ing parties are authorized by law to undertake or pro- vide.35 In Illinois, non-home-rule entities may not circum- vent statutory requirements or limitations by entering into IGAs.36 Also, “an entity formed under an intergov- ernmental cooperation agreement in Illinois between home rule and non-home-rule municipalities [is] bound by statutory limitations governing its non-home-rule members.”37 Although home rule members are exempt from competitive bidding statutes, non-home-rule mu- nicipalities are subject to the state's procurement re- quirements.38 The second approach that a few states follow is the “power of one unit” approach that allows all govern- mental units or agencies that are parties to an IGA to exercise a power so long as one unit or agency has the power to do so.39 For example, New York recognizes the “mutability of powers” approach,40 whereas Pennsyl- vania recognizes the “power of one unit” approach.41 The enabling statute in California provides that it is not “necessary that any power common to the contract- ing parties be exercisable by each such contracting party with respect to the geographical area in which such power is to be jointly exercised.”42 Similarly, the Minnesota statute provides: Notwithstanding the provisions of subdivision 1 requiring commonality of powers between parties to any agreement, the governing body of any governmental unit as defined in subdivision 1 may enter into agreements with any other governmental unit to perform on behalf of that unit any service or function which the governmental unit pro- 33 Id. 34 Greene County Sch. Dist., 278 Ga. 849, 850–51, 607 S.E.2d 881, 882 (Ga. 2005) (quotation marks omitted) (foot- notes omitted). 35 Id. 36 Rajterowski, 405 Ill. App. 3d at 1119, 940 N.E.2d at 709 (citing Commonwealth Edison Co. v. City of Warrenville, 288 Ill. App. 3d 373, 380, 680 N.E.2d 465 (1997); Fischer v. Brombolich, 207 Ill. App. 3d 1053, 1059, 566 N.E.2d 785 (1991) (some citations omitted)). 37 Id. at 1120. 38 Id. 39 United States Advisory Commission on Intergovernmen- tal Relations, State Laws Governing Local Government Struc- ture and Administration 9 (U.S. Advisory Commission on In- tergovernmental Relations 1993). 40 N.Y. CONST. art. IX, 1(c). 41 Libonati, supra note 6, at 242. 42 CAL. GOV’T CODE § 6502.

7 viding the service or function is authorized to provide for itself.43 There are other state laws or doctrines that may limit the use of IGAs.44 For example, IGAs may be lim- ited by “general state constitutional limits on govern- ment power, such as the anti-delegation doctrine, the prohibition of special commissions, the prohibition of special legislation, restrictions on government subscrip- tion of stock, public purpose requirements, debt limita- tions, and the general state requirement that local gov- ernments not contract away their police power….”45 E. Applicability of Enabling Acts to Transit Agencies The enabling laws that were located for the digest are sufficiently broad to apply to transit agencies. The term “public agency” usually embraces the state, its departments and agencies, political subdivisions, and boards and commissions of the state and any other state; cities and towns; as well as the federal govern- ment and any of its departments.46 Other statutes pro- vide that IGAs may be entered into by a governmental unit,47 a governing authority,48 or a local government or local governmental unit as those terms are defined in the enabling statute.49 In California the term “public agency” includes, but is not limited to, the federal government or any federal department or agency, this state, another state or any state department or agency, a county, county board of education, county superintendent of schools, city, public corporation, public district, re- gional transportation commission of this state or another state, or any joint powers authority formed pursuant to this article by any of these agencies.50 In Missouri 43 MINN. STAT. § 471.59, subds. 1 and 10. 44 Reynolds, supra note 11. 45 Id. at 121–22 (footnotes omitted). 46 IND. CODE § 36-1-7-1 (stating that the term “public agency” is applicable to the state, all political subdivisions; all state agencies; public instrumentalities and public bodies; an- other state; political subdivisions of states other than Indiana; and federal government agencies). See also ARIZ. STAT. § 11-951; CAL. GOV’T CODE § 6500; FLA. STAT. § 163.01(3)(b); IOWA CODE § 28E.2; KAN. STAT. ANN. § 12-2903(a); KY. REV. STAT. ANN. § 65.230; ME. REV. STAT. ANN. § 2202; MICH. COMP. LAWS § 124.502(e); MONT. CODE ANN. § 67-11-203; NEB. REV. STAT. § 13-2503; NEV. REV. STAT. § 277.100(1); N.H. REV. STAT. ANN. § 53-A:2; N.M. STAT. ANN. § 11-1-2(A); N.Y. GEN. MUN. LAW art. 14-G, § 461(1); OKLA. STAT. ANN. § 74-1003(A); R.I. GEN. LAWS § 45-40.1-3(a); S.D. CODIFIED LAWS § 1-24-2; TEX. GOV’T CODE ANN. § 11-13-3(8); WASH. REV. CODE § 39.34.020; W.VA. CODE § 8-23-2(1). 47 MINN. STAT. § 471.59, subd. 1. 48 5 ILL. COMP. STAT. ANN. 225/1(J); MISS. CODE ANN. §§ 31- 7-1 and 17-13-5. 49 5 ILL. COMP. STAT. ANN. 225/1(e); MINN. STAT. § 471.59; NEV. REV. STAT. § 332.015. 50 CAL. GOV’T CODE § 6500. [a]ny municipality or political subdivision of this state may contract and cooperate with other municipalities or political subdivisions thereof, or with other states or their municipalities or political subdivisions, or with the United States, for the planning, development, construc- tion, acquisition or operation of any public improvement or facility, or for a common service, in the manner pro- vided by law.51 A few statutes also mention transit52 or transporta- tion services.53 In Illinois, governmental units may en- ter into an IGA “[f]or the purpose of acquiring, con- structing, owning, operating, extending, reconstructing, maintaining, improving, and subsidizing railroad pas- senger service, and promoting efficient transportation systems within the State….”54 In Massachusetts, the term “government unit” includes regional transit au- thorities.55 In Nevada, the statute refers to the joint use or operation of a public transportation system.56 In Wis- consin, the term “municipality” includes a county or city transit commission.57 F. Authorization to Act Beyond an Agency’s Geographical Area An IGA may be used in some states to permit a gov- ernmental unit or agency to perform a service or func- tion that is outside its geographical jurisdiction.58 One state law provides that, unless limited by the terms of an IGA, any contracting party to an IGA may act within the jurisdiction of all contracting parties as needed to implement the agreement.59 California’s statute pro- vides that “[t]wo or more public agencies by agreement may jointly exercise any power common to the contract- ing parties, even though one or more of the contracting agencies may be located outside this state.”60 North Dakota’s statute broadly states that [a]ny political subdivision of this state may enter into a joint powers agreement with a political subdivision of an- other state or political subdivision of a Canadian province if the power or function to be jointly administered is a power or function authorized by the laws of this state for 51 MO. CONST. art. VI, § 16. 52 5 ILL. COMP. STAT. ANN. 225/3; see also 5 ILL. COMP. STAT. ANN. 225/4. 53 CONN. GEN. STAT. § 7-339b(a)(1). 54 5 ILL. COMP. STAT. ANN. 225/3. 55 MASS. GEN. LAWS ANN. ch 40, § 4A. 56 NEV. REV. STAT. § 277.180(3)(g). 57 WIS. STAT. ANN. § 66.0301(1)(a); see also WIS. STAT. ANN. § 66.0301(1)(b). 58 MINN. STAT. § 471.59; NEB. REV. STAT. § 3-221; N.M. STAT. ANN. § 11-1-3; OHIO REV. CODE ANN. § 167.03(2); S.C. CONST. art. VIII, § 13(B) (“Nothing in this Constitution may be construed to prohibit the State or any of its counties, incorpo- rated municipalities, or other political subdivisions from agree- ing to share the lawful cost, responsibility, and administration of functions with any one or more governments, whether within or without this State.” (emphasis added)). 59 ALA. CODE §§ 11-102-1 and 11-102-2. 60 CAL. GOV’T CODE § 6502.

8 a political subdivision of this state and is authorized by the laws of the other state or province.61 G. Administration of an Agreement State law may authorize the use of an IGA to form a separate legal entity, including a nonprofit corpora- tion,62 or the creation of an “interlocal advisory board” to implement the agreement.63 If so, an agreement may have to state “[t]he precise organization, composition, and nature of any separate legal or administrative en- tity created thereby, together with the powers delegated to it, provided that the entity may be legally created.”64 The Florida attorney general’s office has concluded that a nonprofit corporation created by an interlocal agree- ment to carry out the duties imposed by state and fed- eral law is a state agency under Florida law.65 One agency responding to the survey notes that its govern- ing board is a commission formed by an interlocal agreement.66 If no separate entity is created by an IGA, state law may authorize or require that an IGA include provi- sions for administering the parties’ joint undertaking.67 The acts may authorize agencies to convey existing fa- cilities or equipment to the state or to any public 61 N.D. CENT. CODE § 54-40.3-01(1). 62 ARIZ. STAT. § 11-952; ARK. STAT. § 25-2-104(c)(2); COLO. CONST. art. 14, § 18(2)(b); FLA. STAT. ANN. § 163.01(5)(c); N.D. CENT. CODE § 54-40.3-01(1)(c); OR. REV. STAT. § 190.010(5). 63 CONN. GEN. STAT. §§ 7-339b(a)(2) and 7-339b(a)(3). 64 ARK. STAT. § 25-20-104(c)(2); CONN. GEN. STAT. §§ 7- 339f(5) and (6) (specifying what an agreement must include if there is an interlocal advisory board); MISS. CODE ANN. § 17- 13-9(c). 65 See Fla. Att’y Gen. Op. No. AGO 97-10, dated Feb. 14, 1997, at 4, available at http://www.myfloridalegal.com/ago.nsf /Opinions/D445A925E4C79CD585256441007BB898 (citing Fla. Att’y Gen. Op. 95-44 and FLA. STAT. § 768.28). 66 Survey response of Charlotte Area Transit System (CATS). 67 ARIZ. STAT. §§ 11-952.02(A) and (B); ARK. STAT. § 25-20- 104(d)(1) (“In the event that the agreement does not establish a separate legal entity to conduct the joint or cooperative under- taking, in addition to the items enumerated in subdivisions (c)(1) and (c)(3)-(6) of this section, the agreement shall contain the following….” (emphasis added); COLO. REV. STAT. § 29-20- 105; IND. CODE § 36-1-7-3(a)(5) (“An agreement under this section must provide for the following….”); ME. REV. STAT. ANN. tit. 30-A § 2203; MISS. CODE ANN. § 17-13-9(f) (requiring an agreement to specify “[t]he provision for administration, through a joint board or other appropriate means, of the joint or cooperative undertaking in the event that the agreement does not or may not establish a separate legal entity to conduct the joint or cooperative undertaking”); N.H. REV. STAT. ANN. § 53-A:3(III) (same); WIS. STAT. ANN. § 66.0301(3) (stating that municipalities contracting with other municipalities may pro- vide “a plan for administration of the function or project, which may include but is not limited to provisions as to proration of the expenses involved, deposit and disbursement of funds ap- propriated, submission and approval of budgets, creation of a commission, selection and removal of commissioners, and for- mation and letting of contracts”). agency, as well as to a public corporation or public au- thority, pursuant to the agreement.68 Some statutes provide that the contracting parties may raise money by any means including the incurring of debt.69 H. Authorized or Required Provisions of an Agreement Some state enabling laws require that an IGA spec- ify how the contract is to be implemented.70 For exam- ple, in California, an agreement must “state the pur- pose of the agreement or the power to be exercised” and “provide for the method by which the purpose will be accomplished or the manner in which the power will be exercised.”71 Moreover, many of the enabling laws address the provisions that may or must be included in an IGA. The statutes usually provide that an agreement must be in writing;72 that it may be amended;73 and that it will state its purpose or purposes,74 its duration,75 and the method by which a party may or may not withdraw from an agreement.76 For example, in Connecticut, 68 GA. CONST. art. IX, § III, para. 1(b). 69 MASS. GEN. LAWS ANN. ch. 40, § 4A (“A governmental unit, when duly authorized to do so in accordance with the provisions of law applicable to it, may raise money by any law- ful means, including the incurring of debt for purposes for which it may legally incur debt, to meet its obligations under such agreement.”). 70 ALA. CODE § 11-102-2; CAL. GOV’T CODE § 6503; FLA. STAT. ANN. § 163.01(6); MINN. STAT. § 471.59, subd. 2. 71 CAL. GOV’T CODE § 6503. 72 ALA. CODE § 11-102-2; ARK. STAT. § 25-20-104(b) and (c) (requiring a writing by implication), but see ARK. STAT. § 25- 20-104(h) (authorizing joint cooperation on an informal basis without adherence to the details of the statute); IND. CODE § 36-1-7-2(a)(2); NEV. REV. STAT. §§ 277.110(3)(a)(1) and 277.180(2)(a)(4). 73 ALA. CODE § 11-102-2. 74 ALA. CODE § 11-102-2; ARK. STAT. § 25-20-104(c)(3); CAL. GOV’T CODE § 6503; CONN. GEN. STAT. § 7-339f(2); IDAHO CODE § 67-2332 (“Such contract shall set forth fully the purposes, powers, rights, objectives and responsibilities of the contract- ing parties.”); IND. CODE § 36-1-7-3(a)(2); ME. REV. STAT. ANN. tit. 30-A, § 2203(2)(c); MINN. STAT. § 471.59, subd. 2; MISS. CODE ANN. § 17-13-9(b); NEV. REV. STAT. § 277.180(a)(a)(1); N.M. STAT. ANN. § 11-1-4. 75 ALA. CODE § 11-102-2 (3-year renewable term); ARK. CODE § 25-20-104(c)(1); CAL. GOV’T CODE § 6510 (providing that the agreement may be continued for a definite term); CONN. GEN. STAT. § 7-339f(1) (a term not to exceed 40 years); FLA. STAT. ANN. § 163.01(5)(b); IND. CODE § 36-1-7-3(a)(1); ME. REV. STAT. ANN. tit. 30-A, § 2203(2)(a); MISS. CODE ANN. § 17- 13-9(a); N.H. REV. STAT. ANN. § 11-1-4(E); N.Y. GEN. MUN. LAW art. 14-G, § 466(1); N.C. GEN. STAT. § 160A-461 (“reason- able duration”); N.D. CENT. CODE § 54-40.3-01(1)(b); OR. REV. STAT. § 190.020(e) (may be perpetual); WIS. STAT. ANN. § 66.0301(2) (authorized duration for the length of time speci- fied in the agreement); W.VA. CODE § 8-23-3 (same). 76 ALA. CODE § 11-102-2; ARK. STAT. § 25-20-104(c)(5); CONN. GEN. STAT. § 7-148cc; IND. CODE § 36-1-7-3(a)(4); MINN.

9 “[t]he terms of each agreement shall establish a process for withdrawal from such agreement and shall require that the agreement be reviewed at least once every five years by the body that approved the agreement to as- sess the effectiveness of such agreement….”77 Enabling acts may provide that they are renewable,78 but the extension of the term may be limited.79 In at least one state the law provides that if a party refuses to renew an agreement,80 the remaining parties may continue the IGA.81 Many of the enabling laws require that an IGA in- clude provisions regarding payment for services, facili- ties, equipment, or other property or resources;82 the apportionment of the parties’ responsibility83 and of any fees or revenue owing to the parties;84 and the method of holding, returning, and/or disposing of any property belonging to the parties on the agreement’s termina- tion.85 Some of the statutes mandate that an IGA pro- vide for the transfer of personnel necessary for the agreement 86 while preserving employment benefits.87 Depending on a state’s enabling law, an IGA may provide for the transfer of possession or title to prop- erty;88 financial support for and/or financing of the mat- ter being undertaken by the IGA;89 or the budget for the IGA.90 The law may prohibit any party from incur- ring debt that would become the responsibility of any other party.91 Under some enabling laws, an agreement may include a provision for insurance and/or the in- STAT. § 471.59, subd. 4; MISS. CODE ANN. § 17-13-9(e); OR. REV. STAT. § 190.020(1)(f). 77 CONN. GEN. STAT. § 7-148cc. 78 ALA. CODE § 11-102-2; CONN. GEN. STAT. § 7-148cc. 79 ALA. CODE § 11-102-2 (3 years). 80 ALA. CODE § 11-102-2. 81 ALA. CODE § 11-102-2. 82 CONN. GEN. STAT. § 7-339f(3); N.Y. GEN. MUN. LAW art. 14-G, § 466(3) (requiring that the agreement contain “[p]rovisions for the payment by a contracting public agency of consideration for receiving or obtaining services, personnel, facilities, equipment, other property or resources from another contracting public agency or agencies”). 83 OR. REV. STAT. § 190.020(1)(a). 84 COLO. REV. STAT. § 29-20-105(h); OR. REV. STAT. § 190.020(1)(b). 85 ALA. CODE § 11-102-2; ARK. STAT. §§ 25-20-104(c)(5) and (d)(2); CAL. GOV’T CODE §§ 6511, 6512, and 6512.1; FLA. STAT. ANN. § 163.01(8); ME. REV. STAT. ANN. tit. 30-A, § 2203(3)(B); MINN. STAT. § 471.59, subd. 5; MISS. CODE ANN. § 17-13-9(g); N.D. CENT. CODE § 54-40.3-01(1)(e). 86 OR. REV. STAT. § 190.020(1)(c). 87 Id. 88 FLA. STAT. ANN. § 163.01(5)(d); ME. REV. STAT. ANN. tit. 30-A, § 2203(2)(D); N.D. CENT. CODE § 54-40.3-01(1)(d); OR. REV. STAT. § 190.020(1)(d). 89 ALA. CODE § 11-102-2; ARK. STAT. § 25-20-104(c)(4); MISS. CODE ANN. § 17-13-9(d); WIS. STAT. ANN. § 66.0301(4). 90 ALA. CODE § 11-102-2; MISS. CODE ANN. § 17-13-9(d); N.D. CENT. CODE § 54-40.3-01(1)(d). 91 ALA. CODE § 11-102-2. demnification of participating parties and their officers and employees.92 Typically, the laws authorize the par- ties to undertake any other matter necessary and proper to perform the agreement.93 Montana’s enabling statute is an example of what must or may be included in an IGA. As for what an IGA must cover, the Montana statute states: Each agreement shall specify its duration; the propor- tionate interest which each public agency will have in the property, facilities, and privileges involved in the joint undertaking; the proportion of costs of operation, capital outlay, and maintenance to be borne by each public agency; and such other terms as are considered necessary or required by law. As for additional provisions that may be included in an IGA, the Montana statute states: The agreement may also provide for amendments and termination; disposal of all or any of the property, facili- ties, and privileges jointly owned prior to or at such times as the property, facilities, and privileges or any part thereof cease to be used for the purposes provided in this chapter or upon termination of the agreement; the distri- bution of the proceeds received upon any disposal and of any funds or other property jointly owned and undisposed of; the assumption of payment of any indebtedness aris- ing from the joint undertaking which remains unpaid upon the disposal of all assets or upon a termination of the agreement; and such other provisions as may be nec- essary or convenient.94 An IGA may be expected to specify what constitutes a default under the agreement95 and to include a provi- sion for “the adjudication or settlement of disputes, in- cluding negotiation of settlements, giving of notices, and any and all other matters necessary or appropriate to the performance of the…agreement.”96 I. Approval of an Agreement Many of the enabling acts require that an agreement be approved, for example, by the governing board of each party, either by an ordinance or resolution,97 with 92 CONN. GEN. STAT. § 7-339f(4) (stating that the agreement [m]ay include indemnification of participating public agencies and their officials, officers or employees, by means of insurance or otherwise, against any losses, damages or liabilities arising out of the receiving, obtaining, furnishing or providing of ser- vices, personnel, facilities, equipment or any other property or resources pursuant to the interlocal agreement. 93 ALA. CODE § 11-102-2; ARK. STAT. § 25-20-104(c)(6); FLA. STAT. ANN. § 163.01(r); ME. REV. STAT. ANN. tit. 30-A, § 2203(2)(F); MISS. CODE ANN. § 17-13-9(h); N.D. CENT. CODE § 54-40.3-01(1)(i). 94 MONT. CODE ANN. § 67-11-203(3). 95 FLA. STAT. ANN. § 163.01(15)(b)(2). 96 CONN. GEN. STAT. § 7-339f(6); FLA. STAT. ANN. § 163.01(5)(p). 97 ALA. CODE § 11-102-2; ARK. STAT. § 25-20-104(b); CAL. GOV’T CODE §§ 6501 (approval by Department of General Ser- vices or the Director of General Services); CONN. GEN. STAT. § 7-148cc (stating that “[e]ach participating municipality shall approve any agreement entered into pursuant to this section in the same manner as an ordinance is approved in such partici-

10 some states requiring a public hearing as part of the approval process.98 In some states it is necessary to file an agreement with the appropriate local or state authority.99 State law may require that the state attorney general ap- prove an agreement100 but provide that the attorney general’s failure to approve an agreement within 30, 60, or 90 days is to be deemed to be an approval.101 J. Use for Joint Procurement A feature in some state codes that is of interest to transit agencies is the one allowing the use of IGAs for procurement. Some states authorize governmental units or agencies to enter into IGAs for the purpose of jointly procuring supplies and services, including pro- fessional services, or for the purpose of construction.102 pating municipality or, if no ordinances are approved by such participating municipality, in the same manner as the budget is approved”); CONN. GEN. STAT. § 7-339c (requiring that the proposed agreement be submitted to the legislative body of each participating public agency); IDAHO CODE § 67-2328(b) (“Appropriate action by ordinance, resolution, or otherwise pursuant to law of the governing bodies of these participating public agencies shall be necessary before any such agreement may enter into force.”); IND. CODE §§ 36-1-7(5)(a) and 36-1-7- 10; KY. REV. STAT. ANN. §§ 65.260(3) and 65.300; ME. REV. STAT. ANN. tit. 30-A § 2205; MISS. CODE ANN. §§ 17-13-7(3) and (4); MO. REV. STAT. § 70.220(1); NEB. REV. STAT. § 13-805; NEV. REV. STAT. §§ 277.110(3)(a) and 277.150; N.H. REV. STAT. ANN. §§ 53-A:3 and A:5; N.M. STAT. ANN. § 11-1-3; N.Y. GEN. MUN. LAW art. 14-G, § 469(2); N.C. GEN. STAT. § 160A-461; WASH. REV. CODE ANN. § 39.34.030(2); W. VA. CODE § 8-23-3. 98 N.Y. GEN. MUN. LAW art. 14-G, § 463(1); WIS. STAT. ANN. § 66.0301(6)(c)(1). 99 FLA. STAT. ANN. § 163.01(11); IDAHO CODE § 67-2329 (filed with the Secretary of State); IND. CODE § 36-1-7-6; KY. REV. STAT. ANN. § 65.290; ME. REV. STAT. ANN. tit. 30-A, § 2204 (filed with the affected municipality and the Secretary of State); MISS. CODE ANN. § 17-13-11(3); N.H. REV. STAT. ANN. § 53-A:4 (filed with the Secretary of State); N.M. STAT. ANN. § 11-1-3; N.Y. GEN. MUN. LAW art 14-G § 469(4); N.Y. EXEC. LAW § 107; W. VA. CODE § 8-23-4. 100 ARK. STAT. § 25-20-104(f); COLO. REV. STAT. § 24-46.5- 103; IND. CODE § 36-1-7-4(a) and (b); KY. REV. STAT. ANN. § 65.260(2); MISS. CODE ANN. § 17-13-11(1); VT. STAT. ANN. § 4901(a); NEV. REV. STAT. §§ 277.140 and 277.180(2)(a)(3); N.H. REV. STAT. ANN. § 53-A:3(V); N.Y. GEN. MUN. LAW art. 14-G, § 469(1); WIS. STAT. ANN. § 66.0303(3). 101 ARK. STAT. § 25-20-104(f)(3); IND. CODE § 36-1-7-4(b) (60 days); KY. REV. STAT. ANN. § 65.260(2) (60 days); MISS. CODE ANN. § 17-13-11(2); NEV. REV. STAT. §§ 277.140(1) (30 days); N.H. REV. STAT. ANN. § 53-A:3(V) (30 days); N.Y. GEN. MUN. LAW art. 14-G, § 469(1) (90 days); WIS. STAT. ANN. § 66.0303(3). 102 ALASKA STAT. §§ 36.30.700 and 36.30.710(b); ARK. STAT. § 19-11-249 (acquisition of any commodities or services); COLO. REV. STAT. § 24-110-201, stating that [a]ny public procurement unit may either participate in, sponsor, conduct, or administer a cooperative purchasing agreement for the procurement of any supplies, services, or con- struction with one or more public procurement units, external The acts may provide that “[c]ooperative purchasing may include joint or multiparty contracts between pub- lic procurement units and open-ended state public pro- curement units contracts that are made available to local public procurement units.”103 The purpose of the statutory authority is to permit local governmental units to make the most effi- cient use of their powers by enabling them to cooperate with other localities on a basis of mutual advantage and thereby to provide services and facilities in a manner and pursuant to forms of governmental organization that will accord best with geographic, economic, population, and other factors influencing the needs and development of lo- cal communities.104 A procurement statute may grant authority that is not subject to any particular limits,105 or it may provide that it does not apply to IGAs.106 The agreement may or may not be exempt from public bidding requirements107 procurement activities, or procurement consortiums which in- clude as members tax-exempt organizations as defined by sec- tion 501 (c)(3) of the federal “Internal Revenue Code of 1986,” as amended, in accordance with an agreement entered into be- tween the participants. DEL. CODE tit. 29, § 6933 (materiel or nonprofessional ser- vices); D.C. CODE ANN. § 2-311.02 (not applicable to “construc- tion services or architectural and engineering services related to construction”); HAW. REV. STAT. §§ 103D-801 and 802; KY. REV. STAT. ANN. §§ 45A.295 and 45A.300; LA. REV. STAT. ANN. 39:1702(1) (acquisition of any supplies, services, major repairs, or construction); MD. CODE ANN., STATE FIN. & PROC. § 13-110; MASS. GEN. LAWS ANN. ch. 30B § 1(a); MONT. CODE ANN. § 18- 4-402; NEV. REV. STAT. § 332.195(1); N.M. STAT. ANN. § 13-1- 135(A); OR. REV. STAT. §§ 279A.205 and 279A.220; 62 PA. CONS. STAT. ANN. § 1902; S.C. CODE ANN. § 11-35-4810; TEX. GOV’T CODE ANN. § 791.025(b); VA. CODE ANN. § 2.2-4304(A). 103 ALASKA STAT. § 36.30.700; ARK. STAT. § 19-11-249; COLO. REV. STAT. § 24-110-201; HAW. REV. STAT. § 103D-802; 62 PA. CONS. STAT. ANN. § 1902; S.C. CODE ANN. § 11-35-4810. 104 FLA. STAT. § 163.01(2). See IDAHO CODE § 67-2326; MD. CODE ANN., STATE FIN. & PROC. § 13-110(3)(1)(3); MISS. CODE ANN. § 17-13-3; N.M. STAT. ANN. § 13-1-135. 105 KY. REV. STAT. ANN. § 45A.300(2) (“Nothing in this code shall limit any public purchasing unit from selling to, acquir- ing from, or using any property belonging to another public purchasing unit or foreign purchasing activity independent of the requirements of KRS 45A.070 to 45A.180.”); VA. CODE ANN. § 2.2-4304(B). 106 MASS. GEN. LAWS ANN. ch. 30B § 1(b)(3) (stating that “[t]his chapter shall apply to every contract for the procure- ment of supplies, services or real property and for disposing of supplies or real property by a governmental body as defined herein” but that it does not apply to “an intergovernmental agreement subject to the provisions of section four A of chapter forty”). 107 MISS. CODE ANN. § 31-7-13, Excepted from bid requirements are: (xxix) Purchases made pursuant to qualified cooperative purchasing agreements.— Purchases made by certified purchasing offices of state agencies or governing authorities under cooperative purchasing agree- ments previously approved by the Office of Purchasing and Travel and established by or for any municipality, county, par- ish or state government or the federal government, provided that the notification to potential contractors includes a clause

11 or provide that there must be an opportunity to com- ment regarding the use of an IGA rather than competi- tive bidding.108 K. Use Authorized by the FTA Part V of Federal Transit Agency (FTA) Circular 4220.1F109 encourages the use of joint procurement. FTA states that “[T]he Common Grant Rule for gov- ernmental recipients encourages recipients and subre- cipients to enter into agreements for shared use of property and services.”110 FTA also “encourages non- governmental recipients to consider shared use if eco- nomical and feasible.”111 The FTA Circular notes that “[j]oint procurements offer the advantage of being able to obtain goods and services that may match each par- ticipating recipient’s requirements better than those likely to be available through an assignment of another that sets forth the availability of the cooperative purchasing agreement to other governmental entities. Such purchases shall only be made if the use of the cooperative purchasing agree- ments is determined to be in the best interest of the government entity. TEX. GOV’T CODE ANN. § 791.025(c) (providing that “[a] local government that purchases goods and services under this sec- tion satisfies the requirement of the local government to seek competitive bids for the purchase of the goods and services”); VA. CODE ANN. § 2.2-4304(A), Except for contracts for professional services, a public body may purchase from another public body's contract even if it did not participate in the request for proposal or invitation to bid, if the request for proposal or invitation to bid specified that the procurement was being conducted on behalf of other public bod- ies. Any public body that enters into a cooperative procurement agreement with a county, city, or town whose governing body has adopted alternative policies and procedures pursuant to subdivisions 9 and 10 of § 2.2-4343 shall comply with the alter- native policies and procedures adopted by the governing body of such county, city, or town. WASH. REV. CODE § 39.34.030(5)(b). 108 OR. REV. STAT. §§ 279A.220 (applicable to interstate co- operative procurements) and 279A.220(3)(a), If a purchasing contracting agency is required to provide no- tice of intent to establish a contract or price agreement through an interstate cooperative procurement under subsection (2) of this section: (a) The purchasing contracting agency shall provide vendors who would otherwise be prospective bidders or propos- als on the contract or price agreement, if the procurement were competitively procured under ORS chapter 279B, an opportunity to comment on the intent to establish a contract or price agree- ment through an interstate cooperative procurement. 109 Nov. 1, 2008. 110 FTA defines a “joint procurement” to mean a method of contracting in which two or more purchasers agree from the outset to use a single so- licitation document and enter into a single contract with a ven- dor for delivery of property or services in a fixed quantity, even if expressed as a total minimum and total maximum. Unlike a State or local government purchasing schedule, a joint procure- ment is not drafted for the purpose of accommodating the needs of other parties that may later want to participate in the bene- fits of that contract. See FTA C 4220.1F (Nov. 1, 2008), V-1, et seq., available at http://www.fta.dot.gov/documents/FTA_Circular_4220.1F.pdf. 111 Id. at V-1. recipient’s contract rights” and that when feasible, the “FTA also participates in the costs of joint procure- ments by non-governmental recipients.”112 When using such arrangements, “recipients participating in the joint procurement must ensure compliance with all ap- plicable FTA and Federal requirements and include all required clauses and certifications in the joint solicita- tion and contract documents.”113 Although the USDOT common grant rule provides that “grantees and subgrantees are encouraged to enter into State and local intergovernmental agreements for procurements of common goods and services,”114 FTA recognizes joint purchases to be the only type of inter- governmental agreement suitable for use by its grant- ees and subgrantees. FTA does not authorize grantees to consider intergovernmental purchasing schedules to be the type of state or local intergovernmental agree- ment to which § 18.36(b)(5) is referring. FTA does, how- ever, authorize the use of state purchasing schedules by those grantees permitted to use state purchasing schedules because 49 C.F.R. § 18.36(a) permits states to use their own policies and procedures they use for their own purchases, not because those schedules are “State intergovernmental agreements.”115 As for compliance with federal requirements, the FTA Circular moreover informs recipients that: When obtaining property or services in this manner, the recipient must ensure all Federal requirements, required clauses, and certifications (including Buy America) are properly followed and included, whether in the master in- tergovernmental contract or in the recipient's purchase document. One way of achieving compliance with FTA re- quirements is for all parties to agree to append the re- quired Federal clauses in the purchase order or other document that effects the recipient’s procurement. When buying from these schedules, the recipient should obtain Buy America certification before entering into the pur- chase order. If the product to be purchased is Buy Amer- ica compliant, there is no problem. If the product is not Buy America compliant, the recipient will need to obtain a waiver from FTA before proceeding.116 112 Id. 113 Id. 114 49 C.F.R. § 18.36(b)(5). 115 See FTA C 4220.1F, V-2. It may be noted that the FTA Circular also discusses “piggybacking,” stating that a recipient may find that it has inadvertently acquired con- tract rights in excess of its needs. The recipient may assign those contract rights to other recipients if the original contract contains an assignability provision that permits the assignment of all or a portion of the specified deliverables under the terms originally advertised, competed, evaluated, and awarded, or con- tains other appropriate assignment provisions. Some refer to this process as “piggybacking.” Id. at V-5. 116 Id. at V-2 (emphasis added).