City Council Adopts Local Business Preference Program Ordinance

Posted on 08/10/2021
Info on updated Local Business Preference Program Ordinance

Los Angeles, CA (August 10, 2021) – To further its mission of boosting local business participation in City contracting and increasing employment opportunities for transitional workers, the City Council has approved the restructuring of the Bureau of Contract Administration’s (BCA) Citywide Bid Preference Programs to create the new Local Business Preference Program.

Introduced by Councilmember Paul Krekorian and effective on August 7, 2021, the ordinance (No. 187121) creates more opportunity for Los Angeles County businesses who could be eligible for a contracting preference for local and local small businesses as well as business entities working with the hardest-to-employ populations.

"The Local Business Preference Program is a critical component of the effort I launched six years ago to boost the local economy and highlight the extraordinary businesses that are based in Los Angeles," said Councilmember Krekorian. "It encourages local and small business participation in City-funded contract bidding and keeps jobs in Los Angeles. This is more urgent than ever as we grow the economy coming out of the pandemic." 

Administered by BCA, Bid Preference Programs provide a contracting preference to certified small, local, and other Los Angeles County-based businesses who bid on City contracts for goods, equipment, and supplies.

The Small Local Business, Local Business Preference, and Transitional Job Opportunities (i.e., short-term, wage-paying employment that combines real work, skill development, and supportive services to help overcome barriers to employment) programs have now been consolidated into the Local Business Preference Program. Combining the programs creates consistency for small local and local businesses which previously had different certification requirements. The updated program is intended to further encourage small and large businesses to compete for City contracting opportunities and establish and maintain local operations.

“Our local business community continues to face challenging times. In Los Angeles, we are committed to do all that we can to help keep businesses afloat,” said Dr. Mike Davis, President Pro Tempore, Board of Public Works Commission. “I commend our City Council, the Bureau of Contract Administration, and our partner agencies for improving upon our existing programs and creating even more opportunities for businesses to participate in the public procurement process.”

“We are committed to the success of our local and small business community because it leads to the creation of more jobs for Angelenos and a thriving local economy,” said John L. Reamer, Jr., Inspector of Public Works and Director of the Bureau of Contract Administration. “The Local Business Preference Program will help more small and large businesses competing for City contracts and address the significant need of expanding transitional job opportunities to help vulnerable populations find economic self-sufficiency.”  

As part of the restructuring, preference percentages will increase for local small businesses or local transitional employers based on the threshold contract amount of $150,000. For contract amounts less than $150,000, businesses that are certified as a Local Small Business or Local Transitional Employer will receive a 10 percent preference.

For contract amounts more than $150,000, businesses that are certified as a Local Business Enterprise will receive an eight percent preference.

  • Businesses holding a Local Small Business certification will receive an additional two percent preference.
  • Businesses holding a Local Transitional Jobs Opportunity Program certification will receive an additional two percent preference.
  • A maximum preference of 12 percent can be received under this category.

Prime contractors who are not local businesses but use subcontractors who hold a Local Business Enterprise, Local Small Business Enterprise, and/or Local Transitional Job Opportunities Program certification will receive a 1 percent preference for every 10 percent cost of the work up to a maximum 5 percent preference.

For more information, visit https://bca.lacity.org/certification.