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30. Hire Paris First CITY COUNCIL AGENDA ITEM BRIEFING SHEET Submittal Date: Originating Department: Presented By: Agenda Items No.: 02/13/12 Council Date: City Council W. Kent McIlyar 30. 02/27/12 RECOMMENDED MOTION: Move to approve an Ordinance adding Article VI, Hire Paris First, to Chapter 2, Administration of the City of Paris, Texas Code of Ordinances relating to Local Contracting Preferences POLICY ISSUE(S): Contracts At the City Council meeting of February 13, 2012, Council Member Pickle requested City Staff to develop a local preference ordinance similar to the City of Houston local preference ordinance for City Council review at its next meeting. BOARD/COMMISSION RECOMMENDATION: EXHIBITS: Ordinance ACTION: BUDGET INFO: ❑ Financial Report ❑ Minute Order 10-11 Budget $ ❑ Department Report ❑ Resolutions YTD Actual $ ❑ Presentation ❑ Ordinance Acct. Number ❑ Public Hearing ❑ Other Acct. Name FISCAL NOTES: None REVIEWED AND APPROVED BY: ® Administration ® City Clerk ❑ Community Development ❑ EMS/IT ® Finance ❑ Fire ❑ Municipal Court ® Legal ❑ Library ❑ Police ❑ Eng./Public Works ❑ Utilities City of Paris Revised 2/04/08 Draft Ordinance No. AN ORDINANCE ADDING ARTICLE VI, "HIRE PARIS FIRST" TO CHAPTER 2, ADMINISTRATION, OF THE CODE OF ORDINANCES OF THE CITY OF PARIS, TEXAS; ESTABLISHING NEW GUIDELINES AND CRITERIA FOR SHOWING PREFERENCE FOR LOCAL VENDORS AND CONTRACTORS IN CITY PURCHASING AND CONTRACTING; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; PROVIDING A REPEALER CLAUSE A SEVERABILITY CLAUSE, A SAVINGS CLAUSE; AND DECLARING AN EFFECTIVE DATE. WHEREAS, the Paris City Council wishes to use City purchasing powers in a manner that promotes fiscal responsibility and maximizes the effectiveness of local tax dollars by ensuring a portion of citizens' tax dollars remain in the local economy for economic benefit of the citizens; and WHEREAS, the City Council finds that by encouraging the local business capacity, the City will maintain an able and competitive pool of businesses from which to choose to procure goods and services; and WHEREAS, the City Council finds that awarding contracts to local businesses provides additional economic benefit for the citizens of Paris by keeping their tax dollars local; and WHEREAS, the City Council finds the principal place of business of a contractor or vendor is a relevant criterion in providing best value for the City; and WHEREAS, the City Council finds that awarding contracts to businesses located in the city limits of the City of Paris, Texas, benefits the City and its residents by improving employment opportunities, increasing property values, and increasing sales tax revenues; and WHEREAS, the City Council finds that there is no definition of principal place of business" in the statutes of the State of Texas; therefore, the City adopts its own definition herein; and WHEREAS, the City Council determines that in any procurement addressed by this Ordinance, the local bidder offers the City the best combination of contract price and additional economic development opportunities, including the employment of residents of the City and increased tax revenue to the City; Nn1 WHEREAS, the City Council desires to add Article VI "Hire Paris First'' to Chapter 2, Administration, of the Code of Ordinances of the City of Paris, to utilize state law to create a contracting preference for local businesses; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS: Section 1. That the findings contained in the preamble of this Ordinance are determined to be true and correct and are hereby adopted. Section 2. That Chapter 2 of the City of Paris, Texas Code of Ordinances, is hereby amended by adding a new Article that reads as follows: "ARTICLE VI. HIRE PARIS FIRST Sec. 2-156. Declaration of policy. (a) It is the policy of the city to use the city's spending powers in a manner that promotes fiscal responsibility and maximizes the effectiveness of local tax dollars by ensuring a portion of citizens' tax dollars remain in the local economy for economic benefit of the citizens by utilizing all available legal opportunities to contract with local businesses. (b) It is the policy of the city to place an affirmative duty on city departments to grant a preference to local businesses unless doing so would be clearly contrary to the best interests of the city- (c) It is the policy of the city to achieve the policy goal in subsection (a) above by utilizing all pennissible tools. (d) Nothing in this article prohibits the city from rejecting all bids. Sec. 2-157. Definitions. The words and phrases defined in this section have the following meanings: Bid means any procurement method governed by the Texas Local Government Code, Title 8 Acquisition, Sale or Lease of Property, or as it may be amended. Local business means a business with a principal place of business within the city limits ofthe City of Paris, Texas. Principal place of business means the business must be headquartered or have an established place or places of business in the incorporated limits of the City of Paris, Texas, as applicable, from which 20% or more of the entity's workforce are regularly based, and from which a substantial part of its operations is conducted. A location utilized solely as a storefront, post office box, mail drop or telephone message center or any combination thereof, with no other substantial work function, shall not be construed as a principal place of business. Sec.2-158. Hire Paris First Program-Purchases of personal property. (a) Contracts of $500, 000 or more. In purchasing any personal property that is not affixed to real property, if the city receives one or more bids from a bidder that is a local business and whose bid is within three (3%) percent of the lowest bid price received by the city from a bidder who is not a local business, the city shall, subject to the provisions of section 2-161, award the contract to either: (1) The lowest bidder; or (2) The bidder that is a local business, if the bid from the local business offers the City the best combination of contract price and additional economic benefits (such as employment of local residents and increased tax revenues for the City of Paris). (b) Contracts under $500,000. In purchasing any personal property that is not affixed to real property, if the city receives one or more bids from a bidder that is a local business and whose bid is within five percent (5%) of the lowest bid price received by the city from a bidder that is not a local business, the city shall subject to the provisions of section 2-161, award the contract to either: (1) The lowest bidder; or (2) The bidder that is a local business, if the bid from the local business offers the City the best combination of contract price and additional economic benefits (such as employment of local residents and increased tax revenues to the City of Paris). Sec. 2-159. Hire Paris First Program-Procurement of services. Contracts over $100,000. In procuring services, including construction services, if the city receives one or more bids from a bidder that is a local business if the city receives one or more bids from a bidder that is a local business and whose bid is within three (3%) percent of the lowest bid price received by the city from a bidder who is not a local business, the city shall, subject to the provisions of section 2-161, award the contract to either: (1) The lowest bidder; or (2) The bidder that is a local business, if the bid fi-orn the local business offers the City the best combination of contract price and additional economic benefits (such as employment of local residents and increased tax revenues for the City of Paris). Contracts under $100,000. In procuring services, including construction services, if the city receives one or more bids from a bidder that is a local business if the city receives one or more bids from a bidder that is a local business and whose bid is within three (3%) percent of the lowest bid price received by the city from a bidder who is not a local business, the city shall, subject to the provisions of section 2-161, award the contract to either: (1) The lowest bidder; or (2) The bidder that is a local business, if the bid from the local business offers the City the best combination of contract price and additional economic benefits (such as employment of local residents and increased tax revenues for the City of Paris). Sec. 2-160. Hire Paris First Program-Purchases under $50,000. Subject to Texas Government Code §2254.004, when procuring goods or services valued at less than $50,000 that are not the subject of a blanket purchase order or contract, the City shall, subject to the requirements of section 2-161, select vendors and services providers with a principal place of business in the local area, provided that any such vendor's bid is no more than five percent (5%) greater than the lowest bid, in the event the lowest bid is from one other than a local business. Sec.2-161. Hire Paris First Program-Exceptions. (a) This program does not apply to any contract in which the federal government participates in the form of a grant or loan, or the city acts as a conduit for federal money. (b) This program does not apply to contracts in which the contracting department has determined that it would unduly interfere with contract needs. (c) In accordance with Local Government Code section 271.905 1, this program does not apply to the purchase of telecormnunications services or information services, as those terms are defined by 47 U.S.C. Section 153." Section 3. That by a supermajority vote of _ ayes and nays, the City Council voted to suspend the rule requiring two readings before adoption of this ordinance. Section 4. That this ordinance shall become effective from and after its passage of the 1aa first reading and publication as required by law. Section 5. That this ordinance shall become effective immediately upon its passage. PASSED AND ADOPTED this 27th day of February, 2012. A.J. Hashmi, M.D., Mayor ATTEST: Janice Ellis, City Clerk APPROVED AS TO FORM: W. Kent McIlyar, City Attorney c~~L- -