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Pinellas ordinance would give local firms edge in contract bidding

CLEARWATER — Pinellas County could soon give local firms a leg up on government contracts to help their businesses weather the recession.

A proposed ordinance would give Pinellas businesses extra points for having local headquarters. To a lesser extent, companies from surrounding counties would get preference, too.

The proposal has been met with mixed reviews, and not just between the favored locals and the disadvantaged out-of-towners.

While some commissioners are pushing for the change, County Administrator Bob LaSala and other officials warn that such a system could drive up costs for taxpayers by reducing the incentive for lower bids.

Local business owners downplay questions of favoritism, saying it's time the county helped businesses improve and compete against bigger firms.

"It's just good politics and it's good economics to keep the business local," said architect Steven Klar of Clearwater, who has lobbied for the new policy.

The proposal, to be discussed at a 6:30 p.m. hearing today, would give local and regional firms extra points for consulting and other work like architecture and engineering.

Those contracts are scored based on a point system. Under the proposed ordinance, a Pinellas-based firm would get a 10 percent bonus on top of its final score. A firm from Hillsborough, Manatee or Pasco counties would get a 5 percent upgrade.

For other competitive bids, a local company also would get the contract in case of a tie.

The new policy would affect about 40 percent of Pinellas' contracts, about $103 million of work. The county doesn't track how many area companies get business now.

Manatee and Polk counties already give local firms preference. Hernando County is working to draft a similar ordinance. And in Tampa, a City Council workshop on a local vendor preference is scheduled for Aug. 6.

Tampa would favor businesses in Hillsborough, Pinellas, Pasco, Polk and Manatee counties. Preference would be awarded by allowing local companies to offer a price 3 to 10 percent higher than outside vendors and still be considered the lowest bidder — or by allowing them to match an outside vendor's lower bid. Tampa city contracts amounted to nearly $231 million in 2008.

"We should support local businesses," said Tampa City Council member John Dingfelder. "They could use a shot in the arm, especially during these times."

Tampa council member Charlie Miranda objects to the idea because of costs, but also on principle.

"I don't like to build walls," he said, noting that the country's free-market economy assumes companies can do business wherever they choose. "It's setting a precedent that's going to come to haunt us in the long term."

State law allows governments to consider location when awarding contracts, but doesn't automatically give locals a bonus.

"We think the state statute does a good job," said Julie Beauvais, spokeswoman for North Carolina-based Kimley-Horn and Associates, an architecture and design firm with offices in Tampa, Lakeland and Sarasota.

Pinellas' chapter of the Florida Engineering Society also opposed the policy in a letter to the county last week because it sets an "unfair advantage."

However, several Pinellas commissioners indicated they want to broaden the proposal to help even more local companies.

Questions over the law's effects could delay the commission from taking a vote, said Commissioner Karen Seel, a supporter.

"The point, though, is to keep the economic benefits here," Commissioner Ken Welch said recently. But he said Monday he now questions whether the policy would actually work — or whether he will continue to support it.

County staffers have warned that such a policy could "balkanize" contracting, leading to higher prices because each county would favor local firms. If the contracts based mainly on price — such as asphalt purchases — would be included, a local firm could bid 10 percent higher and still win, purchasing chief Joe Lauro said.

In a May memo to commissioners, LaSala called the economic arguments for the policy "dubious."

Noting feedback from other counties, he said "the use of local preference can add time and cost … and is generally agreed to result in higher overall costs of goods and services."

LaSala pushed to include as many as eight counties in the regional category — and confirmed opposition to the new policy during a meeting this month. But commissioners didn't go along.

Klar, the local architect, said his firm has gone from 15 employees to seven within the past two years. Of roughly 12 attempts over 18 years at county business, he received three contracts, he said.

Klar, who wants even bigger advantages for local firms, also wasn't happy with Lauro, who included outside companies in an e-mail about the proposed ordinance. Lauro said he was sending an e-mail to people who are interested in the measure.

"I never thought my own county staff would be my enemy," Klar wrote to commissioners.

David DeCamp can be reached at ddecamp@sptimes.com or (727) 445-4167.

if you go

Want to be heard on the issue?

What: The Pinellas County Commission will talk about a proposed ordinance for local preference in county contracts.

When: 6:30 p.m. today.

Where: Fifth floor, Pinellas County Courthouse, 315 Court St., Clearwater.

Pinellas ordinance would give local firms edge in contract bidding 07/20/09 [Last modified: Monday, July 20, 2009 10:57pm]
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