City Weighs Contract Preference Policies

SALISBURY — During discussion of a possible veterans’ preference policy for city contracts, the Salisbury City Council decided to look into expanding those inclinations to cover matters like local and minority owned business as well.
“If you’re going to change your charter, make it broad strokes,” said Council President Jake Day.
The original discussion Monday was in regard to what kind of preference Salisbury should show for businesses seeking city contracts that were owned by veterans or service disabled veterans. The preference would likely take the form of a percentage credit on the project. For example, a veteran owned business might receive a 5-percent boost in value to the contract bid.
“It almost becomes a scoring system, but it’s pretty easy to determine,” said Day.
But in discussing a veterans preference policy, Day revealed that he would also like to see something similar for locally owned businesses.
“I think what we can do, what I’d like to see is some variation on two parallel and potentially combined preferences: a locally owned preference, and a veterans and service disabled veterans preference,” Day said.
That opened a door to some other preference programs that the council thought were worth consideration, such as minority- or female-owned businesses.
“If we’re going to do this, then I think we should include that at the same time, curveball into one,” said Councilwoman Laura Mitchell.
Councilman Tim Spies asked about the status of preferences for new small businesses in Salisbury.
“What about a start-up business in Salisbury? Is there anything additional?” he asked.
There isn’t at the moment, but Councilwoman Terry Cohen felt that a preference for new business ran the risk of forgetting about established businesses that were just as worthy and needed as much or more help.
If preferences are expanded, there’s the potential for them to stack. A veteran-owned business could also be locally- and minority-owned. City Attorney Mark Tilghman told the council that other municipalities have put caps in place for a maximum preference allotment. Cecil County, for instance, caps all preferences at 6 percent of the project cost or $60,000, whichever comes first. Salisbury would also want to be careful in the language used regarding preferences.
“We wouldn’t want to stick something in there that might tie our hands in a major contract situation,” said Tilghman.
There’s a potential major cost behind preferences as well. Any preference on city contracts has to be defensible in case charges of favoritism are leveled. This is usually accomplished by conducting a study. Tilghman believes that Salisbury can base most of the preference policy on studies already done by the state, but needs to be careful of exceeding that because those same studies tend to have high price tags so Salisbury couldn’t afford to conduct one solo.
“I think we can probably piggyback on the state of Maryland with anything that’s been done in regards to its legislation,” Tilghman said. “But if we’re going to go beyond that it would be in a situation where we have to spend $50,000 to justify something.”
The expanded scope of the legislation is sending the matter back to draft. Mitchell pointed out that the city will also need to re-advertise the resolution.
“Now we’re talking about local business preference, minority preference,” she said. “That could bring some different comments then what we have.”
The council agreed to have a new resolution drafted to be presented at the next work session in December.