Local Purchasing Preference — Cleveland

Date: 26 Aug 2015 | posted in: Retail | 0 Facebooktwitterredditmail

Cleveland has a variety of local procurement programs designed to drive contracting and purchasing to locally owned businesses. As a result of these developed policies, in 2014, the city spent 39 percent of its total $147 million in contracting with businesses that are either local and small, or local and minority- or female-owned.

Cleveland’s programs include the Minority and Female-Owned Business Enterprise Program, the Cleveland Area Small Business Purchasing Program, and the Local and Sustainable Purchasing Program. Businesses certified in these categories receive a bid preference that ranges from 2 to 5 percent, and businesses certified in multiple categories can combine them up to a maximum 9 percent bid discount.

More importantly, Cleveland sets goals for how much business it will do with its certified firms, and on bigger contracts like construction projects, requirements for how many certified subcontractors will work the job. For instance, on public improvement contracts, the goal is to have 30 percent of subcontractors be firms that are certified as small and local.

The programs are overseen by the city’s Office of Equal Opportunity.

More information:

Excerpts from Title XV, Chapter 187 — Cleveland Area Business Code

  • 187.01  Definitions of Terms

(f)   “City of Cleveland Small Business” or “CCSB” means a CSB that has its principal office located physically within the municipal boundaries of the City.

(i)   “Cleveland Contracting Market” or “Contracting Market” means the geographic market area consisting of Cuyahoga County, Ohio, or the geographic market area identified in a disparity study or otherwise as provided in Section 187.28.

(ee)   “Regional Cleveland Area Small Business” or “RCSB” means a CSB that has its principal office located physically within the territorial boundaries of Cuyahoga County but outside the municipal boundaries of the City.

(hh)   “Small Business Enterprise” or “SBE” means a Business Enterprise that meets the established economic criteria for a SBE and is owned, operated and controlled by one (1) or more persons who meet the economic criteria for SBE ownership established by the Director in the Regulations.

  • 187.03  Certification of Cleveland Area Small Businesses; Application of Bid Discounts for Bid Comparison

(a)   A Business Enterprise is eligible for certification as a Cleveland Area Small Business if:

(1)   It is a Small Business Enterprise;

(2)   It has its principal office located physically in the Cleveland Contracting Market; and

(3)   Its chief executive officer and highest level managers maintain their offices and perform their managerial functions in the Cleveland Contracting Market.

(b)   Subject to the limitation contained in division (g) of Section 187.05, Contracting Departments may apply a Bid Discount in the following amounts for bids received from CSB prime contractors:

(1)   A Bid Discount of five percent (5%) for bids received from CCSBs.

(2)   A Bid Discount of five percent (5%) for bids received from RCSBs, provided no bids are received from CCSB’s.

  • 187.04  CSB Goals of Contracting Departments

(a)   Consistent with the City’s goal of increasing the level of CSB participation in Contracts, each Contracting Department shall use its best efforts to utilize CSBs as Contractors and subcontractors for all contracts in excess of fifty thousand dollars ($50,000.00). The annual City-wide goal for CSB participation in Public Improvement Contracts shall be thirty percent (30%), in Professional Services Contracts shall be ten percent (10%), and in all other Contracts shall be twenty percent (20%) or such other goal fixed by the Director for a particular Contract.

(b)   To meet the goals fixed under division (a) of this section, Contracting Departments, in consultation with the Director, shall consider use of Bid Discounts under division (b) and (d) of Section 187.03 when recommending a bid as lowest and best or lowest responsible or recommending a proposal as best. Each Contracting Department shall be responsible for ensuring that invitations to bid or requests for proposal issued by or for that department comply with all provisions and procedures set forth in this chapter.

Excerpts from Title XV, Chapter 187A — Local Producer, Local-Food Purchaser and Sustainable Business Preference Code.

  • 187A.01  Definitions of Terms

(l)   “Local Contracting Market” or “Contracting Market” means the geographic market area consisting of Cuyahoga County, Geauga County, Lake County, Lorain County, and Medina County, Ohio; provided, however, that with respect to growers or producers of food only, the geographic market area also shall include: Erie County, Huron County, Richland County, Ashland County, Wayne County, Holmes County, Stark County, Summit County, Portage County, and Tuscarawas County.

(m)   “Local Food” means and includes food that is grown, extracted, produced, recycled or manufactured within the Local Contracting Market.

(n)   “Local Producer, Local-Food Purchaser, and Sustainable Business Preference Code”, “Preference Code”, “Code” or “Chapter” means all of the provisions of this Chapter 187A of the Codified Ordinances of Cleveland, Ohio, 1976.

(o)   “Local Producer” means a Person that:

(1)   Has its principal office (headquarters) located physically in the Local Contracting Market and whose highest executive officers and highest level managers maintain their offices and perform their respective executive and managerial functions and duties in the Local Contracting Market; and

(2)   A.    Grows food or fabricates goods, whether or not finished, from organic or raw materials;

  1. Processes goods, materials, food or other products so as to increase their commercial value by not less than fifty percent (50%);
  2. Supplies goods by performing a Commercially Useful Function; or
  3. Provides, by its qualified full-time employees, maintenance, repair, personal, or professional services.

(p)   “Local-Food Purchaser” means a Business Enterprise that, in implementation of its City contract, purchases Local Food in an amount comprising not less than twenty percent (20%) of the Business Enterprise’s City Contract amount.

(q)   “Local Sustainable Business” means a Business Enterprise that:

(1)   Has its principal office (headquarters) located physically in the Local Contracting Market and whose highest executive officers and highest level managers maintain their offices and perform their respective executive and managerial functions and duties in the Local Contracting Market; and

(2)   Has established sustainability goals for itself and is a member of or signatory to a nationally- recognized sustainability program, which goals and program have been determined acceptable by the City Chief of Sustainability or other officer designated by the Mayor.

  • 187A.02  Preference for Local Producers, Local- Food Purchasers, and Local Sustainable Businesses

(a)   Application of Bid Discount – A Contracting Department shall apply a Bid Discount of two percent (2%) to a bid received from a Local Producer; two percent (2%) to a bid received from a Local Sustainable Business; and two percent (2%) to a bid received from a Local-Food Purchaser; provided that the maximum total Bid Discount applied under this division (a) shall not exceed four percent (4%). Bid Discounts applied under this division (a) shall be in addition to any Bid Discount applied under Sections 187.03 and 187.05. The maximum amount of any Bid Discounts applied to a bid under this division (a) shall not exceed fifty thousand dollars ($50,000.00), provided, however, that the maximum cumulative amount of all Bid Discounts applied to the bid under this division (a) and under Sections 187.03 and 187.05 shall not exceed seventy- five thousand dollars ($75,000.00).

(b)   Application of Evaluation Credit – A Contracting Department shall apply an Evaluation Credit of two percent (2%) of the total points awarded for a proposal received from a Local Producer, two percent (2%) of the total points awarded for a proposal received from a Local Sustainable Business, and two percent (2%) of the total points awarded for a proposal received from a Local-Food Purchaser; provided that the maximum total Evaluation Credit applied under this division (b) shall not exceed four percent (4%).

(Ord. No. 1660-A-09. Passed 3-29-10, eff. 5-30-10)

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Stacy Mitchell

Stacy Mitchell is co-director of the Institute for Local Self-Reliance, and directs its Independent Business Initiative, which partners with a wide range of allies to implement policies that counter concentrated power and strengthen local economies.