Selling to government: Price Reductions to S&L Governments

Can state and local government entities be given additional price reductions, otherwise known as "spot discounts" under the Schedule contracts?

Yes. State and local government entities may be given spot discounts under the under Cooperative Purchasing provision (applicable only to GSA Schedule 70, GSA Schedule 00CORP (IT SINS only) and GSA Schedule 84)
Will a spot discount to state and local government entities under the GSA Schedule contract trigger the Price Reductions clause?

No. Giving state and local agencies a spot discount under the GSA Schedule contract will not trigger the Price Reductions clause.