Local Preference Program (LPP)
The LPP Ordinance allows the granting of preferences in certain discretionary contract solicitations to local businesses or businesses with knowledge of, and/or experience working with, local conditions where appropriate.
To comply with the LPP Ordinance, bidders are required to submit a LPP Identification Form(PDF, 163KB) as part of their response to some City solicitations.
Local SA Fact Sheet(PDF, 168KB)
Ordinance & Amendments
The LPP Policy and its amendments took effect on the following dates:
The original ordinance established the LPP, allowing the City to grant contracting preferences to local businesses in circumstances when price alone determines the winning bid for personal property, non-professional services, and construction services, and the procurement is governed by Title 8 of the Texas Local Government Code. Under the program, a contract is awarded to a business within San Antonio City limits in instances where the City receives a bid from a local business that is within a certain percentage of the lowest bid price received from a non-city business. Additionally, provisions were included in the original ordinance granting preferences to local businesses for professional service contracts that are not governed by statute.
First Amendment
The first amendment to the LPP expanded the application to any contract for goods and non-professional services where the City chooses to conduct a solicitation process and to award on the basis of price. For example, the preference would apply to procurements utilizing the health or safety exemption found in Chapter 252, Texas Local Government Code, when the City seeks offers from multiple suppliers. It would also apply when the City seeks offers from multiple vendors that have contracts with cooperative purchasing organizations.
The first amendment also expanded the application to concession and other revenue-generating contracts in addition to professional service agreements not governed by statute as originally contained in the ordinance.
Second Amendment
The second amendment to the LPP aligned the current LPP Ordinance with State law to increase the preference from 3% to 5% within certain thresholds for low bid good/supplies, low bid non-professional and construction contracts and expanding the application of the LPP to include contracts funded in whole or in part by the federal government or where the City acts as a conduit for federal money to allow application of the LPP when federal statutes or the federal grantor expressly mandates or encourages geographic preference. While there are still prohibitions when using federal funds, it is recommended the City expand application of the LPP in all areas allowable, such as in instances allowed by applicable federal statutes or where the federal grantor expressly mandates or encourages geographic preference.
The second amendment also expanded the program to allow application to non-profit organizations for both low bid nonprofessional services and discretionary professional services where not restricted by statute.
Program Details
The Finance Department administers the program and produces quarterly reports summarizing the dollar amount of procurements awarded to local businesses under this program.
A local business (also known as a City Business) is defined as a business headquartered within the incorporated San Antonio city limits OR one that meets the following conditions:
- Has an established place of business for at least one year in the incorporated limits of the City:
- From which at least 100 of its employees OR at least 20% of its total full-time, part-time, and contract employees are regularly based
- AND
- From which a substantial role in the business's performance of a commercially useful function or a substantial part of its operations is conducted by those employees
"Headquartered" is defined as the place where an entity's officers direct, control, and coordinate its activities.
The LPP applies to the following:
- Personal Property (Goods/Supplies): Within 5% of the lowest non-local bidder for contracts of $50,000 or more
- Non-Professional Services: Within 5% of the lowest non-local bidder for contracts of $50,000 to under $500,000
- Construction Services: Within 5% of the lowest non-local bidder for contracts of $50,000 to under $100,000, excluding contracts awarded using alternative delivery methods
- Other Discretionary Solicitations not Governed by Statute:
- 10 evaluation points for a local businesses headquartered within the incorporated San Antonio city limits
- OR
- 5 points for local businesses not headquartered within the incorporated San Antonio city limits
Exceptions:
- The LPP does not apply to contracts less than $50,000 in value, or other types of contracts not described by the ordinance
- The LPP does not apply to contracts where the Managing Department or City Council has determined that it would not be in the best interest of the City
- In accordance with Texas Local Government Code §271.9051, the LPP does not apply to the purchase of telecommunications services or information services, as those terms are defined by 47 U.S.C.A. §153
NOTE: The LPP Ordinance does not replace and is a separate program from the Small Business Economic Development Advocacy (SBEDA) Program Ordinance.