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Section 4: Interagency Cooperation Contract

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The Interagency Cooperation Contract (IAC) is used in lieu of a grant agreement when the project involves the Texas Department of Transportation’s (TxDOT’s) purchase of goods or services from another state agency. As indicated in the preceding section, grant agreements involve the pass-through of federal funds for the benefit of the recipient agency for conducting a particular traffic safety activity.


Interagency Cooperation Contract

An IAC is an agreement between another state agency and TxDOT for the procurement of goods or services. The regulation governing the use of IACs is contained in the following chapters of the Texas Government Code:

In an IAC, the terminology identifying contract participants is different from that used in a grant agreement. TxDOT is called the “Receiving Agency” and the contractor is identified as the “Performing Agency.”

Another distinguishing feature between IACs and grant agreements is that if the dollar amount is less than $50,000, the Traffic Operations Division (TRF) director can sign it. If the dollar amount of the IAC is equal to or over $50,000, the contract must be processed by the General Services Division’s Contract Services Section (GSD-CSS) and signed by GSD-CSS, the GSD director, or the TxDOT assistant executive director, the deputy executive director, or the executive director.

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Because TxDOT is purchasing goods or services, the IAC is a direct expenditure of funds rather than a “pass-through” of federal funds as with a grant agreement.

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Contract Number

TRF obtains the miscellaneous contract number assigned to each grant in the Electronic Grants Management System (eGrants) and enters it on the IAC front page after the contract has completed the internal review and approval process. The performing agency leaves this space blank. The contract number, once assigned, is included on all correspondence and other eGrants documents relating to the project.

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Charge Number

TRF also obtains the ten-digit charge number assigned by eGrants, and enters it under the contract number. The charge number is created from the fiscal year, a numerical program area and sub-area designator, a task indicator, a numerical indicator for fund source, and a sequence code. A typical charge number looks like this: (9)AL-01-A1-AA. eGrants will include the charge number on all Performance Reports and Requests for Reimbursement (RFRs).

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Preparing the IAC

In preparing the IAC document, the performing agency fills in the information described in the following table.

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Information Needed



The Receiving Agency: Texas Department of Transportation.

The Performing Agency: The full legal name of the contractor organization and the organization’s payee identification number (PIN) should be entered here on the IAC.



The performing agency will undertake and carry out services described in Attachment A, “Scope of Services” (or “Project Description”).



The total amount of this contract shall not exceed $ (Provide Amount) and shall conform to the provisions of Attachment B, Estimated Budget. Payments shall be billed through the eGrants RFR process.



Payment under this contract beyond the end of the current fiscal biennium is subject to availability of appropriated funds. If funds are not appropriated, this contract will be terminated immediately with no liability to TxDOT. This contract begins when fully executed by both parties and terminates on (Provide Date of Contract Termination).



The agreeing parties do hereby certify that:

  • the services specified above are necessary and essential for activities that are properly within the statutory functions and programs of the affected agencies of state government
  • the proposed arrangements serve the interest of the efficient and economical administration of the state government
  • the services, supplies, or materials agreed upon are not required by Article XVI, Section 21 of the Constitution of Texas to be supplied under contract given to the lower responsible bidder.



Receiving Agency further certifies that it has the authority to request the above services by authority granted in (cite the statute, constitutional, or special provision of the appropriations bill).

Performing Agency further certifies that it has the authority to perform the services by authority granted in (cite the statute, constitutional, or special provision of the appropriations bill).

Signature Blocks

Complete as indicated with legal name of the performing agency, signature of person authorized to sign for the performing agency, title, and date.

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The IAC Contents

The IAC consists of the IAC document and Attachments A, B, and C. Attachment A is the “Project Description/Scope of Services” and must be used with the IAC. Attachment B is the “IAC Estimated Budget” and must also be included with the IAC.

The “IAC General Terms and Conditions” (Attachment C) must be included as the final component of the IAC. Contractors are required to become familiar with the contents of the “IAC General Terms and Conditions”, because failure to do so will not excuse nonperformance or noncompliance.

NOTE: An IAC is comprised of IAC attachments A, B, and C; therefore, an IAC is not considered complete until Attachments A, B, and C are completed and included with the IAC document.

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Obtaining the IAC and Attachments

Attachments A, B, and C are included in the IAC packet and are not available online. TRF-TS will forward the IAC packet to the subgrantee for preparation once it is determined that an IAC will be used.

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Transmittal Form

The “Interagency Contract/Amendment Transmittal Form” is used for sending the IAC from the office where it was processed or originated (be it a district, division, or office) to the TxDOT General Services Division - Contract Services Section (GSD-CSS) for review and further processing for administrative approval and signature. The one-page form is self explanatory, and a copy is provided with the IAC packet.

NOTE: IACs less than $50,000 can be signed by the TRF director and do not require processing by GSD-CSS. So, in these instances, there is no need to submit the “Interagency Contract/Amendment Transmittal Form.”

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Process Overview

An overview of the eGrants proposal process can be found in the eGrants Proposal Process Workflow (flow chart).

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