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Bid system can't legally, ethically or economically favor local firms

Public purchasing shouldn't be confused with public relations, but that is the danger of an idea being kicked around by Zephyrhills City Council to give preference to local vendors. It's a feel-good policy that isn't particularly effective and could drive up the cost of goods and services to taxpayers.

Council member Manny Funes floated the idea previously and Monday night it surfaced again after a discussion of rehabilitating the flood-damaged downtown fire station. The council didn't settle on a specific plan, nor did it direct the city staff to devise one, but members should check the City Hall archives for a refresher on the inappropriateness of playing favorites with the public purse.

Eight years ago a then-council member sought to discard the low bid for an equipment purchase because it was from an out-of-town company. The second-lowest bid, which came in more than the city had budgeted, was local and therefore worthy of council support, two members reasoned. The idea died on a 2-2 vote, but it sparked a more prolonged debate about a local preference policy, a plan eventually abandoned as imprudent and against state law.

Amid an extended recession that has seen Pasco County's unemployment rate of 12.1 percent top the statewide average, there again is a push for keeping government dollars local. And, not just in Zephyrhills. The suggestion has surfaced in the city of Tampa and in Hillsborough and Hernando counties, among other places. Monday, a building contractor asked Zephyrhills to keep its spending local.

It is a politically pleasing, though simplistic idea: Governments should give preference to local businesses when awarding contracts and making purchases to keep the money local and to save jobs. Policies can entail giving additional points to local companies when bids are ranked or allowing local companies to match low bids from out-of-town firms.

But skewing the rules for purchases and services to give an unfair advantage to those with Zephyrhills address invites abuse and potential reluctance from outside companies to bid. That, in turn, can drive up prices and cost the public more than it should. Worse, it can spur legal challenges that ratchet up legal fees and delay needed work.

It is an ill-advised idea considering the recession, falling real estate values, new property exemptions from Amendment 1, reduced sales tax collections and fewer state revenue sharing dollars that have left all local governments scrambling to match revenues with expenditures. Zephyrhills already is trimming its capital project list because it can't afford all the needed work and it picked the cheapest plan to fix its fire station. The City Council shouldn't invite higher prices now with a new purchasing tactic.

A properly administered bid system should give the public the best product for the best cost and that is a laudable government goal no matter what the economic conditions are locally.

Bid system can't legally, ethically or economically favor local firms 10/14/09 [Last modified: Wednesday, October 14, 2009 11:32pm]

    

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