Proposed changes to the City of Whitehorse’s procurement policy would mean that local businesses with bid prices close to Outside company’s bids would have a chance. (Joel Krahn/Yukon News file)

Whitehorse council ponders potential local considerations in new procurement policy

City staff have suggested a local preference clause

One per cent could mean all the difference for local firms looking to be awarded Whitehorse city contracts

In other words, if a local and Outside firm each bid and end up with the same scores on a city contract, prices would be compared. If they’re within one per cent of each other, the local firm would be awarded the contract; that’s if a potential change to a city policy eventually goes ahead.

Lindsay Schneider, the city’s manager of financial services, proposed the idea at an April 25 council and senior management session focused on a new procurement policy for the city.

It’s anticipated a formal policy will come to council for a vote in July, though that will depend on discussions with stakeholders and informal talks with council.

Schneider acknowledged the many concerns expressed around local preference after a Whitehorse business lost the contract to supply the city’s bedding plants for the year because its bid was $250 higher than its competitor.

The price difference in the flowers was slightly higher than the one per cent city staff is proposing as a price differential, but Schneider argued the proposal “definitely provides a leg up” for local businesses without have a major impact on city budgets.

The city would be unique in providing a local preference price differential, Schneider said, noting most municipalities across the country are subject to trade rules that do not allow for such.

Most have general wording around endeavoring to purchase from local vendors where possible.

The one per cent price differential would apply to contracts less than $100,000, similar to the wording in the Yukon government’s own policy.

The one per cent price difference would provide local firms with an advantage without having a major impact on city spending, Schneider said, noting that about 76 per cent of the city’s purchases are already made in the Whitehorse area.

As she pointed out it will require council members to decide how they want to define “local.” Is it a business with a municipal business license, or perhaps with an inter-municipal license that covers the territory?

She put forward the definition cover the inter-municipal license, which would also include businesses just outside city limits.

While other factors could also be considered, Schneider said it is business license information the city could most easily access.

The potential policy would also leave contract awards in the hands of administration rather than coming forward for council approval, a change Coun. Laura Cabott described as a “major shift”.

Schneider said the city is already obligated to award contracts according to the purchasing and sales policy. By the time a contract award comes to council, the city is already in a contract situation. If council chose not to award a recommended contract, there could be legal implications.

Schneider also presented proposed requirements that spending under $10,000 be at the manager’s discretion. Anything between $10,000 and $50,000 would require three informal quotes, though verbal quotes would not be accepted.

Anything more than $50,000 would require a formal procurement process where the contract is put out for tender or proposal.

Administration would be responsible for signing off on the contracts and then reporting back to council on the contracts awarded and how the policy is working.

Both councillors Cabott and Dan Boyd asked city staff come up with a document to compare the new proposal against the current – much shorter – purchasing policy.

Meetings with stakeholders and another council and senior management meeting are planned which could result in further changes to the proposal before a formal document comes to council for approval.

Contact Stephanie Waddell at stephanie.waddell@yukon-news.com

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