In This Section
Legal Authority
Sourcewell is a local government unit, public corporation and public agency under the laws of the state of Minnesota.
Formation
Sourcewell is a local government unit, public corporation and public agency established under the laws of the state of Minnesota, known as a service cooperative, established under Minn. Stat. § 123A.21.
Purpose
Minnesota service cooperatives are local government units created to assist in meeting the specific needs of participating government units through programs and services which could be better provided by a cooperative than by the members individually. Such programs may include, but are not limited to, those delineated in Minn. Stat. § 123A.21, subd. 7.
Governance
The care, management, and control of Sourcewell is vested in its publicly elected Board of Directors composed of eight (8) members selected by Sourcewell’s Full-voting members. Six (6) members of the Board must be current school board members from school districts in Region 5; two (2) members must be publicly elected officials representing the governing bodies of cities, counties, or other government units in Region 5.
The Sourcewell Board of Directors may appoint up to three (3) nonvoting ex-officio members for purposes of advisory participation from a cross section of Full-voting Members.
The board has broad authority to conduct the business necessary to maintain and operate the organization.
Public purpose
Because Sourcewell is a local government unit:
• All Sourcewell employees are government employees;
• All property owned by Sourcewell are public property; and
• All Sourcewell funds must be used to serve only public and governmental purposes.
Sourcewell has authority to expend funds for purposes outlined its enabling statute at Minn. Stat. § 123A.21 provided those expenditures serve a public purpose. An expenditure meets the “public purpose” requirement when:
• It benefits the community as a whole;
• Is directly related to a government function; and
• Does not mainly benefit a private individual or entity.
Sourcewell property is exempt from all taxes and assessments.
Cooperative purchasing authority
Pursuant to Minn. Stat. § 123A.21 subd. 7(23), Sourcewell is authorized to provide cooperative purchasing solutions to its members and Participating Entities.
Sourcewell cooperative purchasing contracts are awarded through a competitive solicitation process consistent with Minnesota law.
Joint powers authority
Through the joint exercise of powers authorized by Minn. Stat. § 471.59, Sourcewell is able to expand its impact by partnering with other governmental units to jointly or cooperatively exercise powers common to the parties, or any similar powers. With respect to joint powers, “governmental unit” may include any government, education, or nonprofit agency that has similar joint powers, intergovernmental cooperation, or cooperative purchasing laws in their respective jurisdiction.
Disclaimer
Members and Participating Entities are responsible for performing due diligence and ensuring their use of Sourcewell cooperative contracts complies with all applicable federal, state, and local laws and policies, and specific funding requirements.
Additional Resources:
Sourcewell establishment, purpose, governance, and authority
Sourcewell Cooperative Purchasing Program
Sourcewell Procurement Process
Organizational Bylaws
Sourcewell Procurement Policy
Sourcewell Procurement Code of Ethics
Legal Statutes
Select a state to view additional information on regulation of cooperative purchasing in your area.
Participation
Participation in Sourcewell is available at no cost and without obligation to any government unit, including a state, city, county, town, school district, political subdivision of any state, federally recognized Indian tribe, any agency of the United States, any instrumentality of a governmental unit, any other entity as defined in Minn. Stat. § 471.59, subd. 1(b), and any entity as defined in Art. VI of the Sourcewell Bylaws.
Full-voting membership in Sourcewell is available to public school districts, cities, counties, and other government units as defined by Minn. Stat. § 471.59, subd. 1(b) in a geographically defined area consisting of Cass, Crow Wing, Morrison, Todd, and Wadena counties of Minnesota known as Region 5.
Participating Entity membership is available to school districts, cities, counties, or other government units, as well as nonpublic school administrative units, nonprofit agencies or organizations, and other partnership agencies or organizations, regardless of geographic location.
Common Questions
Yes! Sourcewell is a service cooperative created by the Minnesota legislature as a local unit of government. Minn. Const. art. XII, sec. 3. As a public corporation and agency, Sourcewell is governed by local elected municipal officials and school board members. Minn. Stat. § 123A.21 Subd. 4 (2017).
Under its enabling statute, Sourcewell is explicitly authorized to provide cooperative purchasing services. Id. at Subd. 7(23). Sourcewell follows the competitive contracting law process to solicit, evaluate, and award cooperative purchasing contracts for goods and services. Sourcewell cooperative purchasing contracts are made available through the joint exercise of powers law to participating agencies. Minn. Stat. § 471.59 (2017).
Participation in Sourcewell is available for all eligible government and education entities across North America. § 123A.21 at Subd. 3.
We streamline the procurement process for agencies by developing RFPs and submitting them for competitive solicitations. For details on our rigorous process, please visit our page on how cooperative purchasing works.
Sourcewell clients’ ability to use cooperative purchasing contracts depends upon joint powers, intergovernmental cooperation, or cooperative purchasing laws in their respective jurisdiction.
Participating agencies have the ability to propose new or additional terms and conditions which do not interfere with the general purpose or intent established in the current contract. By reviewing your procurement documentation and local requirements, you may find there are specific requirements by your agency that are not included in the Sourcewell terms and conditions.
Suppliers realize substantial efficiencies through their ability to respond to a single Sourcewell solicitation and Request for Proposal (RFP) that will potentially earn thousands of sales opportunities that might otherwise require unique proposal responses. From these efficiencies, suppliers pay a small administrative fee to Sourcewell calculated as a percentage of sales processed through the competitively solicited procurement contracts awarded and held by the supplier.
Administrative fees are not an additional cost to participating agencies.
This administrative fee covers the costs of contract marketing and facilitation, and it offsets operating expenses incurred by Sourcewell. Funds collected from these fees may also be used for other purposes as allowed by Minnesota statute.
Sourcewell does not receive state or federal aid and does not collect fees for participation. With respect to cooperative contract purchasing, Sourcewell is a self-funded governmental unit. The organization also shares these fees with certain agencies, partner cooperatives, or associations as they demonstrate the desire and ability to help facilitate and market Sourcewell awarded contracts.