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1 RiversideCA.gov
Economic Development, Placemaking and
Branding/Marketing Committee
October 19, 2023
LOCAL PREFERENCE AND DBE
WORKSHOP
Finance Department
RiversideCA.gov
2 Receive input from stakeholders and the public on Local Preference and Disadvantaged Business Enterprise procurement policy expansion.
1. November 19, 2020 – Local Vendor Preference (LVP) and Disadvantaged Business Enterprise (DBE) Procurement Policies and potential new policy implementation overview.
2. January 21, 2021 – Presented organi zational plan for LVP and DBE’s.
3. February 18, 2021 – Clarification of policy objectives, stakeholder engagement process options; expedited timeline for RFP’s on Surplus Land.
4. March 18, 2021 – Task objective updates provided to Committee.
BACKGROUND
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3 Discussion:
1. Current Policies Defined
2. Survey & Research Results
3. Policy Elements to be
Determined
1. Local Preference
2. Disadvantaged Businesses
4. Other Considerations
WORKSHOP EXPECTATIONS
POLICIES &
PROCEDURES
Research
Develop
Agree
Implement
Monitor &
Review
Update
RiversideCA.gov
4 1. Purchasing Resolution 23914, Section 604. Preference Policy. (Authority)
2. Purchasing Resolution 23914, Section 605. Local
Preference. (Defined Criteria)
3. Local Preference Defined
CURRENT LOCAL PREFERENCE POLICY
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5 1. Approximately 15,000 Businesses Notified
a. Purchasing Vendor Registration Database (PlanetBids) b. Inland Empire Small Bu siness Development Center
c. Community & Economic Deve lopment Business Newsletter
2. Duration: February 11, 2021 – February 28, 2021
3. 678 Survey Respondents
SURVEY STATISTICS
RiversideCA.gov
6 SURVEY RESULTS – VENDOR DATA
38%
56%
26%
3%
16%
17%
0% 10% 20% 30% 40% 50% 60%
SELLS GOODS AND MATERIALS
PROFESSIONAL SERVICES
PUBLIC WORKS CONSTRUCTION
LAND DEVELOPMENT
TECHNOLOGY
FACILITY SERVICES/REPAIRS
Respondent Percentage by Business Category
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7 SURVEY RESULTS – VENDOR DATA
38%
0% 0% 0% 0% 0%
38%
57%
0% 3%
13%
16%
38%
55%
0% 3%
12%
19%
SELLS GOODS AND MATERIALS PROFESSIONAL SERVICES PUBLIC WORKS CONSTRUCTION LAND DEVELOPMENT TECHNOLOGY FACILITY SERVICES/REPAIRS Current Policy vs. Expansion Options
Current Percentage Benefitting from Local Preference (City Only) Percentage if Local Preference is applied to Category
Percentage if Local Preference is applied within the County RiversideCA.gov
8 SURVEY RESULTS – CONTRACT AWARD DATA
91%
4% 2% 2% 1% 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0 100
200
300
400
500
600
700
0 ‐ 55 –1 0 1 0 –1 5 1 5 –2 0 G r e a t e r than 20 Contracts Awarded to Firm (3 Years)
Responses
% of Responses
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9 SURVEY RESULTS – CONTRACT AWARD DATA
65 124
98 178
0 20
40 60
80 100
120
140
160
180
200
GOODS SERVICES
Contracts by the Numbers
City Count
County Count
RiversideCA.gov
10 SURVEY RESULTS – VENDOR OPINION
If you were considered a Non-Local
Vendor
If you were considered a Local
Vendor
Questions
NoYesNoYes
15%85%LVP Benefits the local economy?
7%93%LVP Benefits the local vendor?
50%50%42%58%LVP promotes fair and impartial treatment of all vendors?
48%52%41%59%LVP promotes fair and open competition?
57%43%LVP prepares local vendors to be competitive outside of area and in open market?
47%53%LVP may promote local vendors to increase prices? 9 10
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11 SURVEY RESULTS – VENDOR OPINION
LOCAL BUSINESS DEFINED
Is the Popular Consensus in Line with Current
Policy?
In Favor %NoYesBusiness Type
Yes77%158520Principle Place of Business
Yes21%537141Residential Address – Zoned for
Conducting Business
Yes44%378300Commercial Address
No36%431247Permanent Location
Not specified in policy12%59583Chain Franchise – Owned by Local Investor
Not specified in policy19%548130Storefront – Headquarters Elsewhere RiversideCA.gov
12 1. Workshop Participation Interest: 302 Businesses
2. Riverside Chamber of Commerce to co-host with
Finance Department on Surplus Property Local
Preference.
3. Additional Possible Stakeholders (Pending Response):
a. Riverside County Black Chamber of Commerce
b. Greater Riverside Hispanic Chamber of Commerce
c. Inland Empire Hispanic Leadership Council
d. Inland Empire Labor Council
SURVEY RESULTS – STAKEHOLDER
INVOLVEMENT
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13 How should “Local” be defined?
1. City of Santa Ana
a. City Preference
b. Business License & Certificate of Occupancy
c. County Preference
2. City of San Diego
a. Physical Place of Business
b. Significant Employee Presence
3. City of Phoenix
a. Principal place of business wi thin the City of surrounding Counties.
LOCAL PREFERENCE RESEARCH RESULTS
POLICY ELEMENTS TO BE DETERMINED
RiversideCA.gov
14 What types of contracts should be eligible for Local Preference?
1. City of Santa Ana – materials, supplies, labor, equipment and services
2. San Diego – public works contracts are to include a mandatory subcontractor participation requirement, goods and services included
3. Phoenix – goods and services included
4. Long Beach – non-professional services only
5. County of Riverside – services and professional services included
6. Oakland – surplus land policy fo r parcels over 5,000 square feet
LOCAL PREFERENCE RESEARCH RESULTS
POLICY ELEMENTS TO BE DETERMINED
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15 Should the Local Preference have a dollar amount limitation?
1. Santa Ana – local preference applies to contracts between $5,000 and $100,000
2. San Diego – public works goals $1M or above, contracts between $250,000 and $500,000
3. Phoenix – contracts up to $50,000
4. Long Beach – contracts up to $100,000
5. County of Riverside – 5% preference but capped at $25,000
6. Oakland – professional services contracts greater than $50,000
LOCAL PREFERENCE RESEARCH RESULTS
POLICY ELEMENTS TO BE DETERMINED
RiversideCA.gov
16 How should “DBE” be defined as a preference?
1. Disadvantage Business Enterprise ’s (DBE) are for-profit small business concerns where socially and economically
disadvantaged individuals own at least a 51% interest and control management and daily business operations.
2. Many of the programs adminis tered by California cities are implemented in accordance with regulations of the U.S
Department of Transportation, 49 Code of Federal Regulation Part 26 as a condition of receiving Federal financial assistance from the Department of Transportation.
“DBE” PREFERENCE RESEARCH RESULTS
POLICY ELEMENTS TO BE DETERMINED
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17 What types of contracts should be eligible for a “DBE” Preference, and should there be a dollar amount limitation?
1. Riverside County
a. Veteran-qualified businesses, small businesses, and local businesses receive a 5% procurement preference.
b. A maximum cap of $25,000 for the preference designations applies. c. The 5% preference cannot exceed a cost of more than $25,000 for the lowest bid.
2. City of Moreno Valley
a. A 5% preference is given to local small business vendors for the purchase of nonprofessional services, supplies, materials and equipment. b. Utilizes and participation of Disabled Veterans Business Enterprises in city procurements aligns preference with the State requirements. “DBE” PREFERENCE RESEARCH RESULTS
POLICY ELEMENTS TO BE DETERMINED
RiversideCA.gov
18 What types of contracts should be eligible for a “DBE” Preference, and should there be a dollar amount limitation?
3. City of Los Angeles
a. Offers certification of Disad vantaged Business Enterprises, Airport Concessions Disadvantaged Business Enterprises, Minority Business Enterprises, Women Business Enterprises, and Small Local Business Enterprises.
b. Businesses certified as a sma ll local business with a 10% preference applied to bid contracts of $100,000 or less. c. A certified transitional employ er is granted a preference to contracts that do not exceed $100,000.
“DBE” PREFERENCE RESEARCH RESULTS
POLICY ELEMENTS TO BE DETERMINED
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19 What types of contracts should be eligible for a “DBE” Preference, and should there be a dollar amount
limitation?
1. State of California
a. DGS offers certification for:
a. Small Business
b. Disabled Veteran Enterprises
c. (OSDS) administers the new Sm all Business for the purpose of Public Works (SB-PW) certification
b. 5% bid preference (Standard)
“DBE” PREFERENCE RESEARCH RESULTS
POLICY ELEMENTS TO BE DETERMINED
RiversideCA.gov
20 State law and City Charter requirements provide some limitations to note.
1. Charter section 1109 requires all public works
construction contracts to be let to the “lowest
responsible bidder.”
2. Enterprise funds (water, electric, refuse, sewer)
utilizing ratepayer funds subject to Prop. 218.
OTHER CONSIDERATIONS
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21 • This item contributes to the Envision Riverside 2025 City Council Strategic Priority 3 – Economic Opportunity and, specifically, Goal 3.4: Collaborate with key partners to implement policies and programs that promote local business growth and ensure equitable opportunities for all.
This item also aligns with each of the five Cross-Cutting Threads as follows:
1. Community Trust – Connecting local and disadvantaged businesses with increased procurement and contracting opportunities is in the public best interes t, benefits the City’s diverse populations and results in the greater public good.
2. Equity – Connecting local and disadvantaged businesses wit h increased opportunities during the solicitation and contracting processes is supportive of the City’s racia l, ethnic, religious, sexual orientation, identity, geographic, and other attributes of diversity and is committed to advancing the fairness of treatment, recognition of rights, and equitable distribution of services to ensure every member of the community has equal access to share the benefits of community progress.
3. Fiscal Responsibility – This item supports local and disadvantaged businesses through procurement, allowing for an opportunity to ensure that costs for services are aligned with the City budget and are cost effective.
4. Innovation – Connecting local, disadvantaged businesses and stakeholders with the opportunity to expand policies and procedures creating collaborative partnerships and adaptive processes.
5. Sustainability & Resiliency – This item supports future growth for local and disadvantaged businesses in the community.
STRATEGIC PLAN ALIGNMENT
RiversideCA.gov
22 That the Economic Development, Placemaking and
Branding/Marketing Committee:
1. Discuss and provide input for local preference and
disadvantaged business enterprise procurement policy
expansion; and
2. Direct staff to incorporate stakeholder and public
feedback, as well as discuss determinations for policy and legislative revisions.
RECOMMENDATIONS
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