Dive Brief:
- The U.S. General Services Administration announced an updated agreement with OpenAI, the artificial intelligence juggernaut behind ChatGPT, that will extend discounted AI services to local, state and tribal governments for the first time.
- The agreement removes a monthly $15 licensing fee for governments and offers 50% off standard commercial pricing for ChatGPT models with no spend commitments or minimum orders. The new agreement goes into effect Oct. 1 and extends through 2028.
- OpenAI said it will also expand support for government cyber defenders overseeing critical infrastructure with discounted training.
Dive Insight:
As state and local governments begin incorporating AI into daily operations, more are exploring partnership agreements with private providers to expand access to AI services.
California entered an agreement with AI-provider Anthropic this summer to provide a 50% discount for municipalities in the state.
GSA launched its OneGov initiative in April 2025 with the aim of modernizing how the federal government procures services, beginning with IT and software.
Since then, the agency says it has saved $1.68 billion for the federal government, the vast majority stemming from agreements with AI service providers to expand access to AI tools for federal employees.
The agency is in the process of renewing those agreements with AI providers “where appropriate.” Pricing agreements for AI services with Anthropic and Google are also set to expire this month. While no official renewal agreement has been announced, GSA’s arrangement with Anthropic was recently extended until Oct. 31, FedScoop reported.
