Boise Considers “Trade War” Ordinance

While perhaps well intended, Boise City Councilors are set to consider an ordinance that very possibly is contrary to State bidding laws and the United States Constitution.

Calling it a “local preference ordinance,” Boise Councilors will hold a first reading of an ordinance revision that would deny EQUAL PROTECTION under the city bid law to any vendor living outside Ada, Boise, Canyon, Elmore, Gem and Payette counties. Vendors with a “significant economic presence” in those (local) counties get preferential treatment, even if underbid.

The GUARDIAN thinks this flies in the face of the equal protection clause of the 14th amendment to the U.S. Constitution. It is also not a wise move to limit competition. Can’t imagine the Feds standing still either if US tax money is sent to Boise for a project, but only those in 6 counties are allowed to bid.

We find it absurd to award contracts based on the geographical location of those providing the goods and services. Imagine if Twin Falls and Lewiston, for instance, passed ordinances cutting Boise area businesses from fair bid competition. Boise officials need to stop and consider their ill-advised actions before bringing full scale animosity on the city and starting municipal trade wars.

Introduced by Councilor Dave Eberle, the ordinance ALLOWS the city to award bids based upon geography, but does not MANDATE such action. In their zeal to help out local businesses, they have stricken a section of the present 17 page ordinance that further limits special treatment to IDAHO vendors in favor of just those in the specified counties. We suspect that provision is also ripe for challenge.

Here is the crux of the new language: “… Departments may limit solicitations of bids,
quotes and offers to entities with a significant local economic presence.”

They are relying upon a provision of Idaho state law which says in part, any political subdivision can choose to award a contract to a bidder other than the apparent low bidder, as long as “the political subdivision shall declare its reason or reasons on the record and shall communicate such reason or reasons in writing to all persons who have submitted a competing bid.”

They are missing the fact those reasons cannot violate other bid laws, the U.S. Constitution, or apply only to residents of certain geographical areas.

Boise is the first city in the state to consider a local preference ordinance and let’s hope it is the last. We advise a city attorney or elected official to seek an attorney general opinion before wasting more effort on this one. The City Council will vote on the ordinance following a public hearing at the third reading of the ordinance, currently scheduled for the May 5 council meeting.

Check out the PROPOSED ORDINANCE. Underlined portions are additions, strikeouts have line through middle of words. Changes begin on page 8.

Comments & Discussion

Comments are closed for this post.

  1. This is nuts! Populism seems to be creeping more and more into everything these days. That last great populist era preceded two World Wars and the Great Depression. Xenophobia is sure to follow.

  2. Why not do it the way they do in Chicago and other big cities: Contracts shall be made only with bidders who have made extremely large “donations” to certain government officials.

    EDITOR NOTE–Gordon is trying to say, “Significant economic PRESENTS.”

  3. Only one conclusion: STUPID!!!!
    What is their IQ????

  4. Tom Anderson
    Apr 14, 2009, 9:25 pm

    Folks, money spent on local companies stays here instead of going to California or Taiwan. A dollar spent here that stays here makes us richer as a community, and grows our economy instead of some other one half a world away.

    Check out the ‘Think Boise First’ website for info.

    Here are the TOP TEN reasons for Buying Local…


    Several studies have shown that when you buy from an independent, locally owned business a significantly greater portion of your money is used to make purchases from other local businesses, service providers and farms — continuing to strengthen the economic base of the community


    Non-profit organizations receive an average 250% more support from smaller business owners than they do from large businesses.


    Where we shop, where we eat and have fun — all of it makes our community home and one-of-a-kind businesses are an integral part of the distinctive character of Boise.


    Locally owned businesses can make more local purchases requiring less transportation and generally set up shop in city centers as opposed to developing on the fringe contributing to less sprawl, congestion, habitat loss and pollution.


    Small local businesses are collectively the largest employer nationally and therefore provide the most jobs to residents in communities.


    Local businesses often hire people with a better understanding of the products they are selling and take more time to get to know customers.


    Local businesses are owned by people who live in this community, are less likely to leave, and are more invested in the community’s future.


    Local businesses in city centers require comparatively little infrastructure investment and make more efficient use of public services.


    A marketplace of tens of thousands of small businesses is the best way to ensure innovation and low prices over the long-term.


    A growing body of economic research shows that in an increasingly homogenized world, entrepreneurs and skilled workers are more likely to invest and settle in communities that preserve their one-of-a-kind businesses and distinctive character.

    EDITOR NOTE–Tom, we agree with all of that, but you can’t make it a LAW!

  5. three words: the sherman act


  6. I remember this was the plan for the capitol restoration project. Locals could not do the work for all the skill sets needed.

    I am all for BUY IDAHO when possible and I may even pay a little bit more to keep my dough in state.

    The rule is shop globally but try to buy local when possible. At lease you will have a good fix on what is reasonable and proper no matter who gets the jobs.

  7. Hmmm…guess I can’t find anything wrong with keeping our money local. Keeping our dollars local by giving preferential treatment to local vendors builds a more sustainable business model and is good for our local economy. I would hope that Twin Falls, Lewiston, as well as every other town and city in Idaho will see the long term wisdom and benefit of such an ordinance.

  8. I’m sorry but I use to try bidding to the local parks on equipment. In 20 years I was never able to obtain one bid. These companys would come in from out of state and bid lower than I could even buy the product for. They would have special contracts with manufactures just for biding to goverments. I for one think the tax money should stay in Idaho. Sorry but somethimes protectionism is important to local business.

  9. Mike Murphy
    Apr 15, 2009, 6:33 am

    Sometimes Boise is like a Bimbo.

    Often moronic; but you tolerate it – to a point – because she’s so beautiful.

    I’ll say it again…

    Drunk, stoned and TRYING TO, I don’t think I could come up with the asinine conjurings that the powers-that-be present on an almost daily basis.

  10. Gotta agree with Tom Anderson on this one. Keep the money here, in the LOCAL economy. The Guardian isn’t always right, you sheep don’t have to agree w/him.

  11. I buy local every chance I get and very seldom shop at Walmart. You must keep the local contractors honest with competetive prices.

  12. I think Mr. Anderson has the right idea. We need to build a local economy here in the Treasure Valley. We need to become more independent from far away companies and spend our money with local companies that will hire local people that in turn will spend their money locally continuing create more local jobs. It’s a no brainer.

  13. Lets take Robert’s situation as an example of how these protectionism policies would work. Robert’s competition is willing to sell equipment to the city of Boise for lets say $10,000. Robert as he said, cannot even buy the same product for $10,000 he must pay $12,000 for the same equipment and of course needs to mark up the price to make money. So after a 25% mark up must charge $15,000 to the city of Boise for the exact same equipment. In this example the city spent $5,000 more tax dollars for the same equipment. $2000 dollars went to the out of state manufacturer, and $3000 went to Robert pre-tax. This example does not even go into the next issue which is corruption, which will run rampant if competition is limited.

    With that said, all things being equal our local municipalities should buy local… but don’t waste tax dollars, stifle innovation, and reduce competition to do so.

  14. Good for Mr. Eberle. I hope his bill passes. With climate change affecting us now (pine beetle sucks!) and peak oil looming around the corner, we need serious reevaluation of every aspect of our lives and business practices. This means reserving transporting people, food, things, business, etc., only when necessary. Please let’s conserve what’s left of our natural resources. If it can’t be grown here, then ship in the almonds, oranges, and coffee. If it can, grow and keep the food here. Would you like to have enough oil to run hospitals, dental offices, and emergency vehicles down the road? Renewable energy, no matter what, won’t provide a fraction of what we are currently using. If we don’t change our ways and stop basing every action on the almighty dollar, these services we take for granted could vanish…possibly when oil spikes. Stop quibbling over pricing and excuses for constant, needless shipping and continual pollution. There’s plenty of competition right in this area.

  15. Tom Anderson
    Apr 15, 2009, 10:13 am

    So, we ask, how can a foriegn firm come in much lower than a local firm?

    The answer is that they are operating from a place where they can pay slave labor wages and dump their toxic waste in rivers.

    The cheap crap you buy at Walmart is made by prison, child, and slave labor, using processes that are highly toxic, with no waste disposal standards.

    When we consume locally, we can easily check up on the processes used to make the goods and know that there are no ugly externalities.

  16. Transportion costs and exchange rates have a funny way of adding up for foreign-made goods. I always buy the best product or servce I can find at the best price. I could care less where it comes from. If a local product or service is superior and reasonably priced, I’m too happy to spend my money on it.

  17. Many city and county governments has ordinances such as these. I see both the pros and cons of these ordinances. The proposed ordinance should be amended to show “good intentions” those in Idaho and elsewhere. First, order the preferences as Boise then Idaho then out of state. The amendment abolishes preferences for Idaho firms. Secondly, preferential treatment for local firms should happen if they are within 10-15% of the lowest bid. Local firms do not lose out for being competitive and the city does pay too much.

  18. Tom Anderson
    Apr 15, 2009, 11:44 am

    Health risks of shipping pollution have been ‘underestimated’

    John Vidal, Guardian

    One giant container ship can emit almost the same amount of cancer and asthma-causing chemicals as 50m cars [that’s 50 million cars], study finds

    Britain and other European governments have been accused of underestimating the health risks from shipping pollution following research which shows that one giant container ship can emit almost the same amount of cancer and asthma-causing chemicals as 50m cars.

    Confidential data from maritime industry insiders based on engine size and the quality of fuel typically used by ships and cars shows that just 15 of the world’s biggest ships may now emit as much pollution as all the world’s 760m cars. Low-grade ship bunker fuel (or fuel oil) has up to 2,000 times the sulphur content of diesel fuel used in US and European automobiles.

    Pressure is mounting on the UN’s International Maritime Organisation and the EU to tighten laws governing ship emissions following the decision by the US government last week to impose a strict 230-mile buffer zone along the entire US coast, a move that is expected to be followed by Canada.

  19. Mike Murphy
    Apr 15, 2009, 1:29 pm

    Big Mike? Howdy.

    Murph? Wassup.

    To avoid any confusion, I’ll post as “Mike Murphy for Mayor” from here on.

    And again, from the Department of Full Disclosure…

    Mike Murphy for Mayor = The Boise Picayune = Boise No Pants Day = Stay Tuned ; )

  20. Since WalMart is the fastest growing retail merchant in the entire nation, I would think this new language would include CHINA as the greatest provider of ‘significant local economic presence’.
    The morons who support so called “free trade” have been brainwashed by the politicians who don’t want them to understand about “fair trade”. The pollution China creates is a by product of our unsatiable consumer appetites promoted by elites who would rather skim money than work for money. This is all based on easy credit markets so you can buy more than you need to satisfy imagined desire.

  21. Clancey nailed this. I much prefer to buy locally, however, if the product I am purchasing is not made locally to the standards I demand, you can rest assured I will look elsewhere to purchase. Even if I have to pay more.

    I would not go so far as stipulating percentages. If the buyer has done their due diligence in evaluating any bid based on bidding requirements then selecting the best value for his/her project should be priority one regardless of where the bidder/s resides.

    One of the craziest ideas so far coming from City Hall. Ranks right up there with the Trolley.

  22. I think the Republican idea of “no bid” contracts like KBR, Halliburton, Blackwater,etc. got in the terrorist/democracy wars would work well here in Boise. Think about all the jobs! Then we wouldn’t have to worry about where stuff was made. Business will regulate itself. It would not be in the interest for the businesses bidding on taxpayer funded projects to treat the city unfairly. They might not get another contract. This is the problem we have here, too much regulation. Most businesses have what is called enlightened self interest. Why would they poop the public nest?

  23. duder123 Lets try more like a 10% profit. 25% on equipment? What planet did you come from. It would help employ people in Idaho. Pay taxes in Idaho. I think Idaho would make more of a profit.
    Think about it.

  24. Is URS considered a local firm? They have an office here. What about other firms that have offices here, are they considered local? If so, they can still out bid the little guys.

  25. Robert, I have thought about it, how does paying you more for the same product benefit Idaho tax payers? It would be one thing if you actually manufactured the product but a middle man is a middle man in state or other wise.

    Clearly I was speaking in hypotheticals, either way tax payers pay more for the same product. As Gottfried von Haberler put it:

    Nearly every industrial tariff was first imposed as an infant-industry tariff under the promise that in a few years, when the industry had grown sufficiently to face foreign competition, it would be removed. But, in fact, this moment never arrives. The interested parties are never willing to have the duty removed. Thus temporary infant-industry duties are transformed into permanent duties to preserve the industries they protect.

  26. Tom Anderson
    Apr 16, 2009, 8:08 am

    Cathy: Local firms are owned by local people and the profits stay here. Foriegn firms have owners somewhere else and the money flows to wherever the owner or stockholder resides.

    We pay the same whoever gets contracts, the only difference is that with foriegn firms many of the costs are externalities (hidden costs to society).

    Ignorant poor people will always look to price first and don’t care who gets harmed in order for them to get their low price, including themselves in the case of processed poison called food and lead covered toys. Government should be held to a higher standard.

  27. Yossarian_22
    Apr 16, 2009, 9:25 am

    Mr. Anderson hits it spot on. It’s important and smart to support local products/services where available. While everything we need/want is not produced locally now, it would make more sense if it was, environmentally, sustainably and securely. Why anyone would want to support Chinese factories that employ, excuse me…enslave children and low paid workers just because of the price, is beyond me. Unfortunately, so much manufacturing has been transferred overseas for so long that we have no choice on many items now, and we are to blame. But, that must change..and it WILL change when the peak oil equation plays out. When the trucks stop driving and the goodies stop flowing, then a local economy is all that we’ll have.

  28. For those of you that are cheerleading for “local” business, are you referring to local or domestic. The problem with your position is that, as a country, we no longer manufacture anything!
    Are you referring to clothing? How about automobiles, airplanes, trucks, busses, road making equipment, food, shoes, steel, chemicals, computers, oil, gasoline? If, in fact, you are talking about a truly local economy, what if you had to give up everything you own, or need, in your daily lives that isn’t made in Boise, or even Ada county, and someone gave you $5000.00 in cash,(Oh, wait a minute. No cash because it isn’t made here) you couldn’t exist for 30 days. Just think about it….

  29. Tom, I understand that, I should have made myself more clear. Will the Idaho goverment consider out of state firms who have physical offices here as “local” and not just papers on file with SOS?

  30. Dean Gunderson
    Apr 21, 2009, 12:14 am

    I’m a late commentor — I blame the long California commute.

    If the funds used by local government to purchase goods and services are derived from the tax-proceeds of local citizens, then it’s in those citizens’ best interest to ensure that local government MUST first consider spending that money on the goods and services provided by local businesses BEFORE they consider sending that money outside the region.

    This cannot be a foreign concept – can it?

    I admit that it’s unexpected that a Growthaphobe thinks it unwise (and perhaps illegal) to require tax-supported government to shop local…

    The Boise area has been the beneficiary of a tremendous influx of out-of-state capital as local businesses offered up their services on the national & global markets — and took full advantage of the government’s “low bid is the best bid” fantasy. But this scenario also meant that as those business grew the local area had to accomodate all those new employees. This was an unsustainable situation — as the Guardian has pointed out — since it slaved the local economy to a volatile economic sector. It got to the point that no matter how many “tax breaks” the legislature passed, those high volume, fragile business ventures collapsed.

    Stability will be re-established once local government spending (really the only large-scale spending citizens have any true control over), is contained to the local region.

    It’s actually not that unusual for a public agency to restrict acquisitions to companies that are based within geographic proximity. This has very little to do with the equal protection clause, since non-local companies can become eligible for contracts simply by choosing to relocate to Boise — just as Boise (et al) had nothing to do with those companies “choosing” to disqualify themselves by deciding not to locate to the Boise area.

    Localism only becomes prejudicial when the “proximity” offered in the spending statute so severly restricts the public’s options, that it is forced to contract with companies that benefit elected officials (their spouses, or other relatives). Typical proximity statutes specify location winthin 20-50 miles of the issuing agency.

    The mantra of “lowest bid” has Walmarted America, and induced auto-dependent sprawl throughout once-pristine rural regions. And, as in Boise’s case, over leveraged these once small-populated areas into situations where there aren’t enough jobs left to keep everyone working. The long-term impact of such short-sightedness is rampant unemployment, and the attendent rise in crime and urban blight.

    But, then again, if you think this was a good thing — then, by all means, oppose the “buy local” ordinance.

  31. By looking at the angry “Tea Party”
    crowd last week, many touted “free market” signs. A free unrgegulated market, goes for cheap capital and labor at every opportunity. And they wonder where their jobs went? The idea of investing in your community and keeping dollars circulating in the community go out the door if maximizing profit is the bottom line.
    By the looks of most of the tea party mob, I bet most shop in China via WalMart. Anyone notice WalMart slowly changing their Red Star logo with a yellow daisy? Cute huh.
    In this case I can understand a protectionist mentality with the public treasure because where else is public investment going to come from?

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