Thursday, April 29th, 2010 at 7:20pm

You Can Bid If…..

Posted by admin

Bidding Processes are Being Manipulated by Bureaucrats Against Local Companies

In the last six months, Citizens for Better Government, L.L.C. has been contacted by four different members who have cried foul in the bidding process with Lake County government.  One member believes the process for the new countywide radio system at the Lake County Sheriff’s Department was not fair, possibly being corrupt, because of odious specifications.  A local vending company was recently shut out because of changes in service requirements.  A minority owned builder seeking to do work at the new courthouse believes the construction manager is protecting out of town subcontractors.  An established Lake County construction company says he couldn’t bid because of county bond requirements.  A long-term local supplier that provides commercial locks and hardware believes the county is specifying a certain brand to force business to an Orlando company.

After hearing so many of these complaints, our group started looking into some of them.  We believe there is something bad going on in the local bidding process.  In the world of competitive bidding, the goal for a company is to bid the most they can get away with and still get the work.  The more bidders who bid on a project, the lower that price usually goes.  In addition, if you’re bidding against local bidders there’s a natural pressure from the community to do business locally because they’re the ones paying the taxes.  Politicians will pontificate, “We want to buy local.”  However, the bureaucrats in the purchasing department aren’t that keen on buying local because local purchases from local people means that local business people will tell local politicians about local bureaucrats and their foul-ups.  Also, if those from the purchasing department buy local, the fringe benefits like going out to eat, tickets to ballgames, and campaign contributions are harder to attain.

One game that’s being played daily in government offices throughout the state is the manufacturer’s representative visiting the planners, architects, and purchasing manager to convince them to only specify their product brand.  For example, there’s an international conglomerate in the commercial door and hardware business that has a representative in the State of Florida, and this representative’s main job is to meet the decision makers of upcoming projects and convince them to only specify their material.  A lot of times, she will host lunch and learn meetings, give free product samples, and offer special incentives to those using her products.  Her goal is to have the specification written to say, “The project will require XYZ locks and hardware with no substitutions.”  When the specifications are written in that manner, she has just shut out all of the local suppliers and now their hand picked dealer in Orlando can make the sale at a much higher price.  The worst thing these types of companies don’t want on a bid request is “XYZ locks or equivalent.”  By putting equivalent products or services in the mix, other bidders can lower costs to taxpayers.  Plus, it puts restrictive distribution channels on an even footing with local suppliers.

So, how do you have an open bidding process and assure everyone that local, small businesses are not being shut out?  If the politicians are really committed to giving local businesses a fair shot, here are some suggestions:

·        All bids for products and services should allow value engineering for products or services with a caveat for their equivalents.  Request for bids, especially in the construction area, should never specify only one manufacturer.

·        The requirement of performance bonds virtually knocks out every small business in the community and government officials know it.  A performance bond is purchased by a contractor, subcontractor, or service provider from a bank or insurance company.  This bond is an insurance policy that the project will be completed satisfactorily.  However, many contend bonds are about as worthless as the paper they’re written on because of all of the exceptions and legalese.  Just ask anyone who has ever tried to collect on a bond from a defunct project.  The bond requirements, in most government bidding processes, are discriminatory to small companies because financial ratios and over net worth standards are so high that most cannot meet them.  Bonding requirements for local, established companies should be waived if certain criteria are met.

·        Some cities and Lake County are now requiring companies to go through an internet service to bid projects.  Everything in the bidding process should be free and governments should not allow internet services to pass additional services off to prospective bidders as essential to securing bids.  Electronic bidding for projects should be handled by IT departments at the government agency and third party internet services are “for profit” usually at the expense of the small company.

·        Another way purchasing managers discriminate against local bidders is the odious regulations for over-the-top insurance or code requirements.  Government should not ask for any more information, insurance, or code requirements than companies in the private sector require.

·        Local governments should have in their purchasing process real procedures for encouraging local business contracts, and benchmarks should be set on the number of jobs given to local businesses.  Purchasing departments should be trained to assist local companies through the bidding process successfully, and the goal should be to get 80% of the county’s work done by local companies.

·        Before any contract is approved by the Lake County Commission, the question needs to be asked, “What local companies bid on this project and what did our staff do to help local people get the work?”  Changes in this process will require real commitment.

·        Large project bids in Lake County should have a local employee commitment letter from every bidder to ensure that a certain percentage of all workers on the job are from Lake County.  Lake County has some of the most skilled workers in America, and there aren’t too many jobs that can’t be done locally.

The discrimination of local companies in the bidding process must stop and Lake County politicians need to put Lake County’s companies and people first.  The folks who are paying the taxes and casting votes should receive a fair shot in the bidding process, and the burden of getting locals the business should be on the bureaucrats at the county – not the other way around.  Lake County needs to stop their economic stimulus program for Orange County!

Here’s your homework assignment for the day – if you know of a local company or worker who you feel have been discriminated against in the bidding process at any Lake County government agency, any local city government, or the Lake County School Board, email us on our private, confidential “Whistle Blowers” link on our website at www.lakecountygov.info.  If you want Lake County government to put local companies first, then we must identify where the discrimination is occurring.  With 12.8% unemployment, every job is important and nothing is more important than insuring we level the playing field for local companies!

Leave a Reply (No names necessary. If you put your name it will be published.)

© 2010 Right Side of the Lake: Lake County Florida's local government news source from Citizens for Better Government LLC.

The Right Side of the Lake