"Agreement with the state" means that two parties have come to a mutual understanding or arrangement that is legally recognized and accepted by the government or governing body of a particular region or country. Full definition
He also says it violates the collective bargaining agreement with state workers. (wshu.org)
Note: In certain circumstances, you may be granted the option to settle your traffic ticket issue by reaching a plea agreement with the state prosecutor. (dmv.com)
As a charter, we had a performance agreement with the state. (bushcenter.org)