Coming back seven-fold
Published 5:13 pm Friday, December 19, 2008
Much has been written and discussed over the last several months about economic bailouts, stimulus plans and the death of capitalism.
You and I are now in the banking and financial services business, whether we want to be or not, to the tune of $250 billion worth of bank stock purchased a couple of months ago.
Just Friday, the White House announced $17.4 billion in “loans” to cash-strapped General Motors and Chrysler. Many are of the opinion that the automakers should have been left to declare bankruptcy and to let the chips fall where they may. I don’t think President Bush had much of a choice other than to provide the needed cash flow, the tentacles of these two companies are just too far reaching. Doing nothing would have cost much more than the $17.4 billion.
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Just as the tentacles of the big automakers reach far and wide, so do dollars spent with our local merchants. No doubt, we are in the worst economic downturn that many of us have ever seen. But we can work our way through this and come out the other end in better shape than before.
Key to our recovery locally will be to support local businesses and service providers. If you can buy goods and services from Bainbridge and Decatur County businesses, I urge you go that route. By many estimates, locally spent dollars turn over in our community seven times. I am not so sure if that number is not higher.
The effort to keep local dollars local should begin with two of the biggest consumers of goods and services in our area—the City of Bainbridge and Decatur County.
Many county and municipal governments in our area have adopted a system to give preference to local businesses in the bid and procurement process. I urge the Bainbridge City Council and the Decatur County Commission to seriously study, consider and adopt such a policy.
A properly written ordinance or amendment to procurement policies would keep both governments’ fiduciary duty intact, while giving a local business preference over an out-of-area, or out-of-state, provider. If a local merchant or service provider is within a certain percentage or actual dollar amount of the lowest bid, the business should go to the local provider. The difference in price would return seven-fold.
Tom Patton, Decatur County administrator, said the county commission is already strongly considering this option and expected this issue to be on a priority starting in the new year. According to the county’s procurement policies, any expenditure more than $10,000 is required to go through the bid process. All other expenditures simply require Patton’s approval and the majority of those purchases go to local vendors when possible.
A change in the language in the procurement manual is what is needed to give local providers preference in purchases required to be bid. I hope the commission makes this change happen.
The Bainbridge City Council has also studied and discussed a local preference bid option, but not the point of passing an ordinance and putting it in action.
After speaking with Chris Hobby, Bainbridge city manager, this issue has come up at the last several annual planning retreats and the council has chosen not to enact such an ordinance. Purchases under $1,000 can be done simply by purchase order and purchases more than $1,000 and less than $3,000 require Hobby’s approval. According to Hobby, the majority of those expenditures are spent locally.
I applaud both governments for making sure that our tax money is spent locally on the smaller purchases, but it makes sense to establish either a dollar figure or percentage “window” to give more local businesses more of the larger expenditures. The difference will come back seven-fold.
I would be the last person to ask either government to not be as financially responsible as possible. But if a local provider meets the fairly written bid specifications, but comes within an eyelash of the low bid, it would be financially irresponsible not to be able to award the bid to the local provider. The difference would come back seven-fold.