Proposal by Montgomery County Executive Marc Elrich to Create Local Business Preference for Obtaining County Contracts Approved by County Council

For Immediate Release: Wednesday, June 24, 2020

Montgomery County Executive Marc Elrich today thanked the County Council for approving a bill he proposed to create a Local Business Preference Program for obtaining County contracts.

Expedited Bill 25-19, which the County Executive sent to the Council last September was unanimously approved by the Council on June 23, will provide a 10 percent price preference in evaluating a bid or proposal from a local business on a contract awarded by the County. The bill is intended to bolster the County’s economic growth and support the creation and retention of employment opportunities within the County. The Government Operations and Fiscal Policy Committee amended the bill to cap the dollar amount of the preference at $200,000 for a competitive sealed bid.

“I sent this bill to the Council because it is key to ‘walking the walk’ in supporting our local businesses. We know that local business is key to a strong local economy, and we need to use our purchasing power to support them,” said County Executive Marc Elrich. “Money spent on purchases from local businesses generally stays in Montgomery County in the form of wages or purchases from other local businesses. It has a local ripple effect. This is an important tool that was discussed during our 4Business listening sessions last year, and I’m glad we now have it in our toolbox as we continue our work to strengthen our local economy.”

Under provisions of the legislation, the director of the Office of Procurement will be required to certify a business as a local business if it has its principal place of business in the County. The Procurement regulations define a principal place of business in the County as one in which the business has its physical business location or locations only in the County. A qualifying business may also have physical business locations both in and outside of the County, if the County-based locations account for more than 50 percent of the business’s total number of employees or more than 50 percent of the business’s gross sales.

“The local preference points law is something that Montgomery County-based businesses have long deserved,” said Office of Procurement Director Ash Shetty. “In the immediate future, this law will help the local economy as we dig ourselves out of the post-COVID-19 slump. In the long run, it will help build a vibrant and thriving local business ecosystem in Montgomery County.”

County Executive Elrich and County Council President Sidney Katz previously launched the “4Business: Benchmarking to Be the Best for Business” initiative because they want businesses to locate, grow and prosper in Montgomery County. During the past year, County Executive Elrich and Council President Katz hosted six 4Business listening sessions around the County to get feedback directly from business owners. In addition, they received input from the business community via email, an online form, and through an online survey, and followed up with two 4Business charrettes to discuss the feedback received and action plan for improvements.

The need for the provisions in Expedited Bill 25-19 was a consistent message from local business owners. The Council amended the effective date for Expedited Bill 25-19 to Aug. 1, 2020 to give the Office of Procurement time to prepare for changes in procurement procedures.

More information on the program is available at https://montgomerycountymd.gov/pro/home.html.

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Release ID: 20-341
Media Contact: Lorna Virgili 240-277-8072