My firm has done well on county and school district janitorial contracts in Ohio for years. We're looking to expand into city government work now. I know the federal government has set-asides for different small business types, like 8(a) Business Development Program or Service-Disabled Veteran-Owned Small Business (SDVOSB). I've seen some mentions of "local preferences" on city procurement portals but nothing as clear as the federal rules. We just bid on an Invitation for Bid (IFB) for school cleaning, NAICS 561720, and the bid document mentioned a "local business incentive" for firms within city limits. What are the common local preferences or set-asides used by city and county governments, and how do they usually work?
What are the common local preferences or set-asides used by city and county governments?
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City and county governments commonly use local preferences and set-asides based on their state procurement codes and local ordinances, which are different from federal set-asides. Federal acquisitions, like those for the 8(a) Business Development Program or Service-Disabled Veteran-Owned Small Business (SDVOSB), follow the Federal Acquisition Regulation (FAR) and are typically detailed in Section L and Section M of a solicitation. State and local government procurements, however, follow their own rules. You will need to check each city or county's procurement portal and vendor guide for their specific policies.
Common local preferences include a percentage price preference for businesses located within the city or county limits, or those employing a certain percentage of local residents. This means if a local firm bids slightly higher, they can still win the contract if their adjusted price (after applying the preference) is lower than an out-of-area firm's bid. Some jurisdictions also have set-asides for disadvantaged business enterprises (DBE), minority-owned businesses (MBE), or women-owned businesses (WBE), which are certifications separate from federal small business programs. These often require a separate application process with the local or state government. You will find these details in the specific Invitation for Bid (IFB) or Request for Proposals (RFP) documents.