Denver Mayor Michael Hancock has just signed in an executive order to open up the city’s contract bidding process. This was done in hopes that the process will be more inviting to Denver small businesses, especially minority or women-owned business, which are often shut out of the process. Prior to this order, contracts were often awarded to a firm, and then extended for up to 20 years based on that firm’s agreement to continue work at a discount. This method was used under the pretense of saving money for the city. But it also blocked any opportunity for other companies to enter the process. Mayor Hancock believes that this new order will not only still provide savings to the city, but also foster “a balance to create opportunities for the City of Denver…I think that will bring a purity of service and greater quality of service, as well as greater efficiencies.” (From The Denver Business Journal.)
Some points of the new policies include:
- Under long-standing city policy, departments and agencies are required to take bids on all contracts for construction and goods of at least $25,000
- Contracts of $100,000 or more will be advertised by official publication
- Smaller contracts require departments just to request proposals from at least three “responsible bidders”
- Agencies will limit the duration of contracts to three to five years
Since I’m a Denver attorney with extensive experience in Colorado business law, I’m quite in tune with the importance of a viable business contract, including non-disclosure agreements, master service agreements and statements of work. Just as the city of Denver is doing, it is sometimes necessary for a small business to step back, take a look at their existing contracts, and re-frame these to suit the situation at hand.