SALISBURY — A small business and veteran-owned small business procurement preference program will likely see implementation in Salisbury following a successful review in work session this week.
If adopted, the program could be a stepping stone for related initiatives in veteran hiring and minority business preferences.
Under the suggested guidelines, the preference program would give what amounts to a slight score bonus to bids for service submitted by qualified companies for city projects. For example, if a veteran-owned small business and a larger business submitted identical bids for the same Salisbury construction contract, then under the proposal the former would receive a small percentage bump to their bid score.
Those percentages are listed as 5 percent for Small Business Preference, 7 percent for Veteran-Owned Small Business and 8 percent for Disabled-Veteran-Owned Small Business.
“I think that would make you fairly competitive when you’re a small-business facing a big guy from out of town,” said Council President Jake Day.
The council liked the overall idea but the potential unknown costs of the program did spark discussion. While the proposal would only serve as a caveat to the city’s existing scoring system, having any type of preference means that the city might end up paying a little extra on its projects.
“This says contract value so I think we are talking about, theoretically, a difference in price … What I’m saying is that under the state’s program,” said Mark Tilghman, city attorney, “which is what ours is modeled after, you could end up theoretically paying 8 percent more to a disabled veteran who is also operating a small business.”
That won’t always be the case, as the scoring bonus might simply edge an identical bid past a larger competitor. But in some instances that up to 8-percent preference could mean that the city would be taking the higher bid, even if it was only slightly more substantial.
“If it was a multi-million dollar contract would we not include that preference in the contract because 8 percent would be such a significant amount?” asked Councilwoman Laura Mitchell.
Tilghman recommended that such discretion be left up to Salisbury’s Internal Services. That department could gauge which contracts are appropriate for the preferences to apply and which are too large or otherwise unfitting. The decision would be delegated to the director of the department but with large contracts the Mayor and Council would most likely be part of the conversation as well.
“My thought as this point is to move forward and leave discretion to Internal Services. I think, the way I’ve seen contracting and bid processes handled here, I think there’s a lot of controls implemented,” Day said.
The council agreed and the proposal was advanced out of work session and will appear on an upcoming legislative agenda.
The veteran preference could be a starting point for other similar programs that the city would like to see.
“We also talked about a minority owned preference. What’s the status on that?” Mitchell asked.
That policy is waiting in the wings. City administration felt that it was better to test the waters with veteran preference. If the program should prove successful, other efforts will likely make their way to the council’s desk.
“I like this a lot, actually. And what we don’t see here is a veteran preference in hiring. And what I would like to do at some point is if we could entertain the idea of having a resolution to that effect,” said Councilman Tim Spies.