Government agencies usually select the lowest bidder for needed services or products. If an outside bidder offers to do a job for the city for $100,000 and a local asks for $105,000 for the same job, the 5% preference would subtract the amount offered by the local by 5%, which would make it $100,000, and the city would then give the job to the local business, said Deputy City Manager Bob Hall.
The five extra points would be added to the 100-point scale that measures professional service providers. Professional service can include architectural or engineering work, among other things, said city spokeswoman Laurie Frymire née Payne.
Government agencies are required to issue bids for services or products to avoid conflict of interest or the appearance of special treatment when using public funds. This program gives local businesses and vendors an advantage at being selected, which in turn benefits the city's sales tax return. For every dollar spent in the city, Huntington Beach gets $3 to $4 in return, according to a city staff report.
But to ensure fairness and healthy competition, the advantages given to local businesses have their limits. Credit given to local professional services cannot exceed 5% or $5,000, whichever is lower, on contracts that cannot exceed $100,000.
The increase also brings the city up to par with other cities' policies, including Costa Mesa, Long Beach and Riverside, the staff report said.
In other efforts to boost the local economy, the council also voted unanimously to provide car dealerships in Huntington Beach with free annual parking pass vouchers to the city's beach. They can be passed on to customers who buy a new vehicle at local dealerships.
The idea is to get customers to visit the beach and shop at the surrounding businesses, Frymire said.
"Sales tax from automobile sales is the No. 1 revenue source in the city," Hansen said. "Every additional car sold within the city benefits us significantly."