Prince George City Council made a series of resolutions regarding procurement at this week’s meeting.
Council received a report on the City’s current procurement practices, following a resolution made at the February 3rd meeting.
According to the report, delivered by Director of Finance and IT Services Kris Dalio, the City is subject to applicable trade agreements, such as the Comprehensive Economic Trade Agreement (CETA), Canada-UK Trade Continuity Agreement (CUKTCA), Canadian Free Trade Agreement (CFTA) and the New West Partnership Agreement (NWPTA).
These agreements hold the same basic principles of open and non-discriminatory procurement.
Additionally, trade agreements do not permit preferential treatment of local suppliers above certain thresholds.
Dalio also spoke on the procurement process as it relates to the United States.
“Tariffs of course have been a very hot topic of conversation and the information is changing at least once a day,” Dalio said.
“I’ve been trying to track it, trying to get something nailed down for you guys, but it’s literally something different everyday. Until there’s more certainty as to where all that goes, the safe thing to assume is that if tariffs are implemented and sustained, increased costs are eventually passed down to the end consumer, and we are an end consumer.”
Dalio said there will be budget impacts, but he was unable to quantify what those are due to the volatility of the situation.
He added there hasn’t been any guidance from the province for what municipalities should do.
Additionally, Dalio added while municipalities are named in some of the international trade agreements listed above, they are not named in the Canada, US and Mexico agreement, and are not obligated to include the US in procurement practices.
“I’m going to take some time and be really clear on this, what we can do should be very carefully measured on what we should do,” he said.
“Restrictive bidding practices do lead to higher prices and poorer quality goods being procured. There’s examples of goods that we heavily rely on within the organization such as Microsoft for our technology, the bulk of our mobile equipment is manufactured in the United States, there’s parts that we sometimes need to maintain existing infrastructure that we can only get from the United States, so there would be large cost and or efficiency consequences if we move away from goods such as those.”
Dalio added defining a Canadian supplier versus an American supplier isn’t always straight forward.
“My advice to Council is to be very cautious with blanket resolution approaches,” he said.
“We should look for ways to support Canadian companies where we can of course, but I really want to be careful of unintended consequences.”
Councillor Cori Ramsay expressed concerns over businesses being shut down in Prince George because of the tariffs.
“What happens if major industry or light industry have the use of their property downgraded and that impacts our taxation base?” she said.
“We haven’t really had the chance to have that conversation, but we have seen it happen before when Canfor closed its doors and we lost a significant amount of taxation revenue. We have to be thinking about what is the impact is going to be on local businesses that are impacted by the changes and if they have to shut down, what does that mean for the local taxpayer?”
She added she’s already heard about job losses in the North because of tariffs.
Councillor Garth Frizzell moved to have a report come back to Council for options on next steps regarding the City’s procurement practices and other decisions related to the national tariffs between the United States and Canada and to provide information on the provincial tariff roundtable.
Councillor Kyle Sampson also put forward a motion put forward a motion to have a report returned with options of adopting social procurement practices that complement the City’s current procurement criteria, helping recognize bidders who provide greater benefits to the community, but does not unduly tip the scale.
“I want to stress my goal at the outset of all this was never to tie the hands of the municipality and our operations, but to find opportunities the city can undertake to support Canadian, to support local whenever possible,” he said.
Both of these motions were passed, but not unanimously.
Councillor Trudy Klassen said she felt this wasn’t the best use of Councl’s time.
“I really think that we need to let our province and country deal with these issues,” she said.
“As Director Dalio said, there’s a lot of problems in trying to determine what is a Canadian company or what is an American company and what I understood is it will likely hurt us more than we would anticipate.”
Councillor Ron Polillo also put forward a motion to have the City’s Communications department execute and educate a buy local or by PG campaign, which was passed unanimously.
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