V.I. businesses will be able to bid up to 30 percent higher on government supply contracts than out-of-territory businesses and still get the contract, if a bill being considered in the Legislature becomes law in its current form.
The Government Operations Committee debated the measure sponsored by Sen. Nereida "Nellie" Rivera-O’Reilly in Frederiksted on Tuesday, then held it for further amendment at O’Reilly’s request.
The bill would require the Department of Property and Procurement to "procure material, supplies, equipment, parts and other operating tools for the Government of the Virgin Islands within the territory, unless the local price is 30 percent higher than sources outside the territory." Its preamble also refers to services, but the legislation itself – the portion of the bill that would be inserted into the V.I. Code – makes no mention of services. [30-0127]
"This measure seeks to help real brick and mortar businesses stay in business," O’Reilly said.
"Government has what I would call a significant purchasing power. If government chooses to buy locally, it could have a rippling effect that benefits all of us,” she said. “When it purchases out of the territory, it benefits businesses that are not in the territory and are not spending as much locally."
V.I. Assistant Legal Counsel Ernest Morris said it might be possible to amend the bill, but "it would be my position it is very likely this bill as drafted would violate the Commerce Clause of the U.S. Constitution."
At the same time, federal courts have upheld some state preferences in purchasing "in places it only affects intrastate commerce and is evenhanded," he said.
"So depending on way the statute is crafted,” Morris said, a court may find the statute valid.
Several senators, including Sens. Judi Buckley and Donald Cole, said they liked the direction of the bill but would like to get input from Property and Procurement Commissioner Lynn Millin Maduro, who was unable to attend Tuesday, before considering how to amend it.
Voting to hold the bill for amendment were Buckley, Cole, Sens. Clifford Graham, Alicia "Chucky" Hansen, Terrence "Positive" Nelson and Diane Capehart. There was no opposition. Sen. Craig Barshinger was absent. O’Reilly attended but is not a voting member of this committee.
The committee also heard testimony on a bill sponsored by Cole to place limousine services under the regulatory authority of the V.I. Taxicab Commission, rather than under the Division of Licensing and Consumer Affairs where it is under current law. The bill repeals a section of the law exempting limousines from taxi franchise agreements at airports and ports and removes a provision that exempts limousines from Taxicab Commission jurisdiction. [30-0132]
V.I. Taxicab Association Executive Director Judith Wheatley and several taxi drivers testified in support of the legislation, saying limousine services perform the same sort of service but do not pay for medallions.
Licensing and Consumer Affairs Commissioner Wayne Biggs, Bureau of Motor Vehicles Director Jerris Browne and others testified that limousine services use luxury or extended vehicles, serve a different market than taxis, and are well regulated now.
Cole moved to hold the bill for amendment. Voting to hold the bill were Barshinger, Buckley, Cole, Hansen, Nelson and Capehart. Graham was absent. There was no opposition.