Powering Strong Communities

Buying Local: Examining Public Power Procurement to Support Community Suppliers

Based on a conversation with Carolyn Justice-Hinson, Communications and Community Relations Officer, and Lexi Hasapis, Local Vendor Procurement Analyst, Fayetteville Public Works Commission

In terms of its buying power in the community, the Fayetteville Public Works Commission, a public power utility serving more than 80,000 customers in North Carolina, does a little bit of everything. It is involved in construction, seeks a variety of professional services, uses regular office supplies and goods, and gets catering for some meetings. This all adds up. Of its roughly $400 million annual budget, the PWC estimates that it spends about $25 million locally across all purchasing.

In the summer of 2021, the PWC and the City of Fayetteville engaged a law and consulting firm to study its policies related to local, minority, and women owned businesses. The idea is to look at not only how effective its policies are in driving choices about supporting these businesses, but also in getting a deeper understanding of where there might be disparities in the availability of needed goods and services through these firms and its use of them.

This in-depth study is a culmination of a PWC strategic planning effort that began back in 2016 to increase use of local small businesses. The current target is to have at least 10% of construction-related expenses go toward local or minority-owned businesses.

Part of the study is determining a realistic goal to achieve, and if goals can be set for specific expense areas. Having a separate examination for the PWC from the city makes sense, since utility needs include a number of specialized supplies and services, such as transformers, which do not have a local vendor. Although the end goal for both the city and the PWC is to focus on local purchasing, having the same targets might not make sense for building a ballpark versus building a substation.

The study involves not just a thorough review of the city and utility’s policies and procedures, but also includes a survey of current vendors on their needs and perceptions about working with the city and the utility and an inventory of local businesses.

Some might have the perception that since there are lawyers involved in the analysis, this study is a negative reflection on the organization and city. The PWC sees the study as a way to show them how to create a better procurement program that takes the strategic priority set in 2016 to heart, and ensure it is maximizing efforts to support a diverse array of local businesses.

The PWC expects the study to reveal more about local business community needs, what demand there might be for using more local, minority and women owned businesses, and if it can target specific areas for improvement. It hopes to have a clearer picture about what goods and services are available locally and what requires going outside of the city.

Doing this kind of study, said the PWC, is central to making sure the utility is upholding the values of public power. Namely, that public power utilities are dedicated to making their communities better – and giving back where possible. The PWC sees the study as a good way to balance a desire to support the community with the bottom line.

Outside of the study, building relationships with local vendors and understanding how community business skills can match utility needs has been an ongoing effort, made stronger by the public power governance model. Having PWC’s governing board comprised of local leaders means that they can relay questions and concerns from local businesses regarding procurements and how that process is with the city. In fact, it is because the PWC’s commissioners were tuned into this kind of community feedback that they set the strategic initiative back in 2016.

The PWC expects to see findings from the study in Summer 2022.