> What prevents the vendor from jacking up prices or general enshittification at the stage?

Well what I'm proposing building would be source-available and licensed such that the gov can run it themselves if it ever gets too expensive. The sub-gov entities should really band together for the negotiation though, then they can ask for whatever they want: non-profit vendors, liberal licensing, price agreements. A collective of government buyers form basically a monopsony larger than any individual vendor could ever be.