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Item No:                    5G.

 

Meeting Date:           July 9, 2012

 

From:                          Jay M. Evans, City Manager

 

Subject:                      Resolution rescinding the Local Business Enterprise Policy and adopting a new Local Vendor Preference Policy related to the acquisition of goods and services.

 

 


Staff Recommendation:

At the direction of the City Commission, staff presents this resolution for adoption of a Local Vendor Preference Policy.

 

Analysis:

On July 27, 2009 Commission approved resolution 8493 adopting a Local Business Enterprise (LBE) Policy.  On at least two occasions, the current LBE policy has fallen short of providing a benefit to Local Vendors in the City’s bid process.  Commission has directed staff to rework the current LBE policy to be more favorable to local vendors.

 

Staff prepared the attached Local Vendor Preference Policy for consideration.  The attached resolution rescinds the previously adopted LBE policy and adopts a new simpler Local Vendor Preference (LVP) policy, one that should be more favorable to local vendors.

 

Staff has surveyed other agencies in the area to see what LVP programs they offer, if any.  The results of those surveys are summarized in the table included in this memorandum.  Staff has identified the LVP program used by the City of Gainesville as being the simplest and offering a generous percentage for local vendors to obtain the preference.

 

The LVP presented will provide local vendors a 5% preference on all competitive solicitations of $25,000 or more.  The preference amount will never exceed $25,000.  On competitive Request for Proposal’s (RFPs) and Request for Qualifications (RFQs) local vendors will be given a 10 point preference in the evaluation criteria for locale.  Non-local vendors will receive no additional points for locale in an RFP or RFQ. 

 

As written, the LVP will apply to purchases between $25,000 and $500,000.  The 5% preference would not be applicable for purchases exceeding $500,000.  There is a cap of $25,000 on the price differential allowed.


To summarize, staff proposes the following in this resolution:

1)      Rescind the existing LBE Policy previously adopted by resolution 8493,

2)      Adopt the new LVP Policy providing the following:

a.       5% preference, not to exceed $25,000, for all purchases over $25,000,

b.      10 points awarded in RFPs and RFQs,

 

SUMMARY OF LVP PROGRAMS

 

AGENCY NAME

SUMMARIZED PREFERENCE PROGRAM

PERCENTAGE PREFERNCE OF SOME TYPE

City of Gainesville

5% - maximum $25,000 – All Competitive Bids

City of Ocala

$35,000 - $250,000 – 5%

$250,000.01 - $500,000 – 3%

$500,000.01 and up – 2%

$25,000 maximum cost differential on any contract.

Ormond Beach

3% or $25,000 whichever is less.

City of St. Cloud

$200,000 and below – 6%

$200,000 - $1M – 4.5%

$1M - $5M – 3.5%

$5M and Up – 2.75%

City of Lakeland

2% - maximum of $10,000 – All Competitive Bids

NO LOCAL PREFERENCE

Lake County School Board

None – Vendor Education Workshops

City of Tavares

None

City of Mt. Dora

No dollars – Encourage education and notifications

Lake County

None - Rule of Reciprocity

City of Eustis

None

City of Orlando

None – Rule of Reciprocity

LOCAL PRICE MATCH

A local vendor within the allowed % is provided the opportunity to MATCH the low bid from the non-local vendor.

City of Winter Park

Local Price Match – Within 5% - All Competitive Bids

Bonita Springs

Local Price Match – Within 10% - All Competitive Bids

Kissimmee Utility Authority

Local Price Match – Within 5% - All Competitive Bids

Martin County

Local Price Match - Within 5% - All Competitive Bids

City of Clermont

 

Local Price Match

Less than $200,000 – 6%

$200,000 to $1,000,000 - 4.5%

$1M to less than $5M – 3.5%

$5M and up – 2.75%

 


The type of LVP Program used by government agencies are typically one of the following 3 types.

 

No Preference – this option is pretty straight forward.  The agency provides no preference in the competitive bid process to local vendors.  They may have either a rule of reciprocity policy or choose to encourage local vendor participation through education and workshops with local vendors.

 

Percentage Preference – Agencies will offer a single percentage preference or varying percentages based on the value of the purchase or contract.  This is what is being presented based on the direction staff received in the meeting on June 25th.

 

Local Price Match – This method provides a preference percentage but instead of the local vendor winning the bid they must match the lowest bid submitted by the non-local vendor in order to receive the award.  This option results in no additional cost to the agency as the local vendor must match the lowest bid from a non-local vendor.

 

Options:

1.  Adopt the new Local Vendor Preference Policy as written and presented; or

2.  Make changes to the percentage or maximum dollar amount; or

3.  Such alternative action as the Commission may deem appropriate

 

Fiscal Impact: 

The actual fiscal impact to the City cannot be determined.  The City could end up paying more for some projects should the Local Vendor Preference policy be applicable.  Staff recommends providing vendor workshops and education sessions to educate local vendors on doing business with the City.  Educating vendors on the sealed bid process is an effective method to making them more successful and winning City business by being the low bidder.

 

Since October 2, 2009 the City has had approximately 40 projects or purchases exceeding the $25,000 value.  Of those projects staff estimates 15 could not have been provided by a local vendor or were grant funded and the LVP could not have been used.  There are approximately 35 projects where the LVP could have been applicable if the local vendor was within the 5% preference.

 

 

Submission Date and Time:    7/3/2012 6:49 PM____

 

Department: _City Manager___________

Prepared by:  _Mike Thornton__________                     

Attachments:         Yes__X_   No ______

Advertised:   ____Not Required __X___                     

Dates:   __________________________                     

Attorney Review :       Yes___  No ____

                                                

_________________________________           

Revised 6/10/04

 

Reviewed by: Dept. Head ________

 

Finance  Dept. __________________                                     

                              

Deputy C.M. ___________________                                                                         

Submitted by:

City Manager ___________________

 

Account No. _____N/A_________

 

Project No. ______N/A___________

 

WF No. ______________________

 

Budget  _________N/A__________

 

Available ________N/A__________


 

RESOLUTION NO._______________

 

 

RESOLUTION RESCINDING THE LOCAL BUSINESS ENTERPRISE POLICY ADOPTED UNDER RESOLUTION 8493 AND ADOPTING A NEW LOCAL VENDOR PREFERENCE POLICY FOR THE ACQUISITION OF GOODS AND SERVICES; AND PROVIDING AN EFFECTIVE DATE.

 

                        WHEREAS, the City of Leesburg has heretofore adopted and amended formal policies for the purchase of items and services, and

 

                        WHEREAS, the City of Leesburg on July 27, 2009 adopted resolution 8493 which replaced an existing Local Vendor preference policy with a Local Business Enterprise policy, and

 

                        WHEREAS, the City of Leesburg desires by means of this resolution to replace the Local Business Enterprise policy with a standard Local Vendor preference policy, and

 

                        WHEREAS, this resolution in its entirety shall supersede and replace all previous resolutions or sections of resolutions that address purchasing policy related to local vendor preference or any purchase policy related to a locale based vendor preference for any and all purchases of items and services.

 

NOW, THERFORE BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA:

 

            THAT the commission recognizes local business and business with a local presence contribute to the Leesburg economy through spending, employment and civic involvement.  The commission further recognizes City staff and elected officials must be vigilant and be good stewards of taxpayer money.  These two functions must be balanced and not conflict with one another.

 

            THAT the attached policy will define and outline the application of a local vendor preference and is hereby adopted in replacement of the policy formerly promulgated under Resolution 8493.

 

             THAT this resolution shall become effective immediately.

 

PASSED AND ADOPTED by the City Commission of the City of Leesburg, Florida, at a regular meeting held the __9th__ day of __July _ 2012.

 

 

                                                                            __________________________

                                                                             Mayor

 

ATTEST:

 

 

__________________________

City Clerk