The ordinance updates the Local Business Enterprise (LBE) and Non-Discrimination in Contracting rules to raise certification size limits, increase penalties for violations, and improve payment timelines for subcontractors. It also introduces new programs to support small businesses and raises certain contracting thresholds.
Ordinance amending the Administrative Code to revise the Local Business Enterprise (LBE) and Non-Discrimination in Contracting Ordinance (Chapter 14B) to: 1) increase the LBE certification size thresholds and authorize an automatic increase to the thresholds every five years based on the consumer price index; 2) change the LBE certification size threshold term of calculation from an average of gross annual receipts in the prior three to the prior five years; 3) increase penalties for violations of Chapter 14B from up to 10% to up to 25% of the contract or subcontract amount; 4) require prime contractors to include LBE subcontractors’ approved payment requests in payment applications within 30 days of receipt of an invoice; 5) authorize application of separate LBE subcontract participation requirements for micro, small, and SBA-LBEs; 6) extend the bonding assistance program to certain City-funded construction projects; 7) authorize a pilot Mentor-Protégé expansion program, a pilot micro-LBE set-aside program for certain design-build and construction manager/general contractor projects, and a pilot Neighborhood LBE program; and 8) increase the contracting Threshold Amount from $706,000 to $1,000,000 and the Minimum Competitive Amount from $129,000 to $200,000; and make various other changes and clarifications to Chapter 14B, as defined herein.
How it got here
The legislation originated from a need to update the Local Business Enterprise (LBE) program to better support small businesses in San Francisco.
The Small Business Commission reviewed the proposed changes to the LBE program and expressed support for the updates, emphasizing the need for greater accountability and innovative pilot programs.
The Board of Supervisors substituted the original legislation with a revised version that included comprehensive updates to the LBE program.
The Rules Committee amended the legislation and recommended it for passage, highlighting the importance of the changes for small businesses.
The Board of Supervisors finally passed the ordinance, which included significant updates to the LBE program to enhance support for small businesses.
Reconstructed from attached documents & the official record