Council to give local bidders an edge?

Preference eyed for firms in area

tmiller@mercedsunstar.comAugust 19, 2013 

— The Merced City Council during its Monday meeting looked at giving preference to local companies that bid on city projects and services.

The council took no formal vote on the issue, although most members said it should be added to its list of priorities.

"The council, sounds like, does want this on the plate, but not to supplant something that has to get done sooner," Mayor Stan Thurston said.

In fiscal year 2012-13, the city spent more than $2 million on projects and services involving 124 local vendors. That amount does not include chain stores based outside the area, City Manager John Bramble said.

The roadblocks in the way of passing a local-preference procedure are two-fold. The procedure would have to stand a potential court battle, and drawing up the ordinance would take city staff off other projects.

Councilman Tony Dossetti said he's often approached by people, particularly those involved in construction, who say their company has difficulty competing in the bidding process.

He said that eventually adding a local-preference procedure is important.

"We tout it all the time, that we should buy local and spend local," Dossetti said. "I just think, as a city we should take a look at it."

Under the current charter, Merced City Council must take the lowest bidder to respond to the process. The council has no discretion. The city can give preference in the event of tied bids.

A local-preference procedure would give area companies a 5 percent edge in bidding.

To withstand a court challenge, the city would need to identify a competitive disadvantage area businesses have that justify a preference, according to city attorney Greg Diaz.

If the local-preference procedure were to be made the highest priority, some of the bigger projects slowed would include planning with UC Merced, city fiscal planning, high-speed rail station planning, code enforcement ordinances and revenue sharing agreement negotiations.

Without the revenue sharing agreement, for example, the city can't annex new land for projects.

Councilman Mike Murphy said a local-preference procedure should be on the list of the city's priorities, just not at the top.

"I do think we need to add it to the list, but be understanding it's not going to happen tomorrow," Murphy said. "In my mind it's a priority."

Reporter Thaddeus Miller can be reached at (209) 385-2453 or tmiller@mercedsunstar.com.

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