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Deputy City Manager Pamela Ott presented the staff report. She provided a brief history of the Coordinated Business Support Program and noted it is designed to foster local economic growth by encouraging residents and businesses to support local companies, educate business owners on how to do business with the City, and implement local purchasing practices. Ms. Ott reported a local preference program achieves policy interests by improving the local economic vitality and keeping a portion of sales tax within the local economy. She noted some potential drawbacks include fewer bidders and increased cost to the City. She advised the premise is if the procurement submissions are competitively matched in relation to qualifications, quality, experience, and cost, the City will consider locality when selecting providers of goods and services. She clarified the definition of a local provider and noted Council, or the City Manager may waive that preference based on insufficient qualifications, quality or experience, or in the event of an emergency. Ms. Ott reported the Economic Vitality Committee (EVC) discussed the item at its October 17, 2019 meeting; reviewed approaches of other communities; considered advantages and drawbacks to using local preference for goods and services, voted unanimously to recommend local preference in the acquisition of supplies, equipment, and all services. Assistant City Attorney Larissa Seto reported staff recommends applying the local preference to trade services (e.g. plumbers, electricians, locksmiths, etc.), while excluding professional services (e.g. accountants, engineers, landscape architects, attorneys, etc.). She said the proposed local preference ordinance includes an amendment to the Municipal Code, modifications to the Purchasing Procedures and Manual, a local preference for Tie Bid, and a Bid Calculation Preference. Assistant City Attorney Seto clarified the Tie Bid process would be applied when two or more bids are from equally qualified vendors for the same total amount or unit price, giving preference to the city-based vendor. She clarified the Bid Calculation Preference occurs when a city-based bid is higher than a non-city-based bid. The City would then make a five percent adjustment from the total bid of any city-based vendor not to exceed $5,000 for any single purchase order and then compare the bids. She noted that emergency situations would exempt in the proposed amendments and that staff would monitor the process for two years. Assistant City Attorney Seto recommended Council introduce the ordinance and adopt a resolution for related amendments to Purchasing Procedures and Manual. In response to Councilmember Pontin's inquiry, Ms. Ott advised the EVC did not explore vendors whose businesses are in Pleasanton but procure goods and services nationally. Assistant City Attorney Seto further clarified the proposal does not have an appeal process, in the scenario was presented. In response to Councilmember Brown's inquiry, Assistant City Attorney Seto advised this would not apply to GSA contracts and that it would be difficult determine the percentage of the total purchasing this would apply to. Mr. Fialho added that GSA purchases are approximately 10%. In response to Vice Mayor Narum's inquiry, Assistant City Attorney Seto clarified the 5% local business preference is applied only for comparing bids. Vice Mayor Narum opened public comment. Christina Nystrom Mantha. EVC member, expressed her support for the item as it is the right thing to do for the community. City Council Minutes Page 6 of 7 January 21, 2020