Gov. Nathan Deal has announced his intention to extend the $25,000 bidding threshold for state contracts, which expires in June.
“Upon taking office, I spearheaded legislation to increase the bidding threshold for state entities from $5,000 to $25,000,” Deal said in a statement this week. He added that he’s asked state officials to identify strategies, revise policies and develop guidelines to give Peach State businesses a leg up.
Georgia law requires competitive bids for all goods or services that cost more than $25,000. But anything less than that amount can be purchased without having to go through the typical process, where contracts are advertised and businesses from across the country can compete for them.
“We are working to stay ahead of the curve and seizing every opportunity to continue bolstering our economic development efforts,” Deal said. “I believe that increasing opportunities for Georgia-based businesses is one way to do so.”
State Rep. Carl Rogers, R-Gainesville, said an increase in the threshold benefits small businesses by giving state agencies flexibility to deal with local vendors.
When competitive bids are in play, Rogers said, sometimes large, national corporations can undercut small, local businesses.
“I think Gov. Deal has made it that more Georgia-based businesses, hopefully, can benefit,” Rogers said, adding that lawmakers want to give an advantage to local businesses “since they are taxpayers.”
Similar proposals that give local businesses an advantage in purchasing contracts have been discussed in Hall County.
For example, officials have discussed the possibility of implementing a local preference option, wherein county businesses that can quote a price within a certain percentage of the lowest bidder will be awarded the contract.
But officials have resisted implementing local preference out of concerns that it could discourage responsible businesses from bidding.
However, Hall County Administrator Randy Knighton said he is allowed to sign off on some purchases that are less than $10,000 without having to get the approval of the commissioners.
This authority is meant to free up the county to acquire services or resources without having to go through a lengthy bid process.
However, county officials said that they prefer to get at least three bids for any purchase more than $2,500.