Miguel Boggiano's Business Cleaning Co. is bidding on city maintenance jobs with the help of Small Local Business Enterprise program.

A boost for businesses
New city program promotes diversity by giving small firms help in obtaining contracts

By Tanya Mannes, UNION-TRIBUNE

Saturday, July 24, 2010 at 10:09 p.m.

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Miguel Boggiano wants his janitorial company to work for one of the region’s most valued employers: the city of San Diego.

His small firm, The Business Cleaning Company Inc., cleans new construction projects before developers offer them to buyers and also maintains a Humane Society facility and several auto dealerships.

Boggiano recently saw a bid opening with San Diego and decided to apply to serve the city’s janitorial needs.

With help from a new city program, Boggiano has a better shot than ever before.

This summer, the city will give small and local businesses preference in bidding for contracts totaling millions of taxpayer dollars a year. City officials said that 90 percent of businesses in San Diego are small, and deserve public support because they create most local jobs.

Boggiano is bidding on city maintenance jobs including power-washing the Ocean Beach Pier and cleaning public libraries. If he is successful, some of his temporary employees could become permanent, he said.

“These contracts pretty much assure you that you’ll have steady work for three or four years,” said Boggiano.

City leaders launched the new Small Local Business Enterprise program on July 1 after reviewing statistics that showed a lack of diversity among city contractors. White-male-owned companies received more than 97 percent of the $124 million in construction work in 2009, said Debra Fischle-Faulk, San Diego’s director of administration.

“We were looking for some options so that we could make some improvements in those statistics,” she said, “as well as ensure that local contractors were getting work.”

City officials spent the past two years developing the program and it was approved by the City Council in January.

“One of the things I think is important is that everybody in San Diego be able to take part in the local economy,” Mayor Jerry Sanders said in an interview last week. “We hope that a lot of small businesses participate in the program.”

Sanders, who will speak to the San Diego Regional Minority Supplier Development Council on Monday, said the program might result in some projects being slightly more expensive. He’s not worried, saying that hiring locally brings money flowing into the local economy.

Each year, San Diego spends millions of dollars on what it considers small contracts — under $1 million — for everything from crosswalk striping to pencils and notepads. The city could hire more than 100 companies to handle small engineering and capital projects scheduled this year totaling $25 million, according to a list on the city’s website. There are also supplier and service contracts available for security guards at Qualcomm Stadium, grounds maintenance, software, wastewater pumping and disposal for portable toilets, and lead and asbestos abatement, among other projects. (The city’s definition of a small business is based on the firm’s industry and its gross receipts.)

The program reserves public works contracts under $500,000 for small businesses, and has similar rules for contracts for goods and services. It also gives those companies a slight advantage in bidding on projects up to $1 million, by allowing them to be selected even if their bid comes in slightly higher than that of a competitor. The program reduces some bonding requirements. It requires companies that handle large public works projects such as bridges or buildings to make a good-faith effort to hire local subcontractors.

More than 150 contractors have already applied to be prequalified and half of those applications have been approved so far, Fischle-Faulk said. The city is trying to make the process simple and speedy. In many cases, a business can be approved to bid within 10 days of filing a completed application, she said.

Boggiano said he’s excited about the city’s initiative. “If we can get the opportunity to do more business with the city it’ll help boost the economy for the city as well,” Boggiano said, “and it will help generate more jobs and more business for everyone.”

His firm has between 70 and 80 workers on call, and a city contract would allow him to keep more of them busy year-round, he said.

Small-business owner Andre Johnson said he plans to enroll in the program. Johnson obtained a city contract last year through the regular bidding process at a time when he was struggling with lower revenues because of the recession.

“So far the value of the contract is about $44,000,” Johnson said. “It’s not a lot to a big company but it’s a lot to a small company like ours.”

His company, M. Johnson Electric in Lemon Grove, is a full-scale electrical contractor specializing in solar installations and energy management, as well as new commercial construction. Johnson said his contract with San Diego makes him part of the city’s team assessing facilities and recommending repairs and upgrades at office buildings, fire and police stations and public parks throughout San Diego.

“It helps to do the work that’s right here in your own backyard and not have people outside of your local jurisdiction come in and do the work,” he said. “You can be more competitive at home because you incur more costs when you go outside your local area.”

The city has launched a website, sdsmallcontracts.com, to explain how the program works. It provides PDF forms online. Contractors can also visit the city’s Purchasing & Contracting Department in person. “We’re literally trying to hand-walk people through the process to make it easier for them,” Sanders said.