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File Number: 13-630 <br />(5) Documentation of personal contacts with San Leandro businesses or nonprofit <br />organizations informing them of the opportunity to subcontract; <br />(6) Documentation of good faith negotiations with San Leandro businesses and nonprofit <br />organizations to subcontract; <br />(7) Making the project plans and specifications available for review upon the request of <br />interested San Leandro businesses; <br />(8) Documentation of requests for assistance from San Leandro community organizations, <br />contractors or professional groups, local, state or federal business assistance offices or <br />other organizations that provide assistance in the recruitment of San Leandro <br />businesses. <br />Compliance <br />The proposed Local Inclusion ordinance puts the onus on contractors and vendors to <br />demonstrate that they have met the requirements of the program and to document <br />participation by San Leandro businesses. Failure to meet the good faith efforts requirements <br />of the ordinance may subject a violator to de-barment from bidding on City contracts for five <br />years. Additionally, violators are subject to penalties of 10% of the contract amount. <br />Discretionary Incentive <br />In addition to the ordinance's requirements noted above, the proposed ordinance would <br />authorize the City Manager to award, at his or her discretion, if funds are available within the <br />project budget, a monetary bonus for any prime contractor or supplier that exceeds the local <br />Business Participation goal by 100% or more. <br />Program Benefits <br />It is a long-standing policy of the City of San Leandro to support local businesses in a variety <br />of ways. Increased success by San Leandro businesses boosts the local economy by <br />generating increased sales, jobs, and wages. This, in turn, increases City revenues allowing <br />the delivery of increased service benefits to San Leandro residents. <br />A successful Local Inclusion ordinance can help keep local tax revenues within San Leandro. <br />Additionally, an ordinance that encourages large contractors to engage with smaller, local <br />businesses for subcontracts could help local companies develop business relationships that <br />may lead to greater opportunities in the future. Lastly, an ordinance that successfully <br />supports local San Leandro businesses may encourage other businesses to locate in San <br />Leandro so that they may derive similar benefits. <br />Implementation and Program Challenges <br />Staff review of the proposed ordinance had led to several questions about the implementation <br />of the program. In addition to potentially increasing the cost of City contracts, the ordinance <br />has the potential to increase the amount of time needed to get a business under contract, <br />thus increasing the time required to complete City projects. <br />Although specific ordinance implementation activities are not defined in the proposed <br />ordinance, staff believes implementation would be most effective if a pre -qualified list of local <br />businesses was developed. Although doing so will require substantial staff time and <br />resources, it will also simplify the bidding process and minimize controversy and delay when <br />the time comes to determine if bidders are subject to the Local Business Preference Rating <br />Incentive. Effective development of a prequalified list will require a significant outreach <br />City of San Leandro Page 4 Printed on 12123/2013 <br />