Iowa City may see more local businesses bidding out non-local competitors.

The Iowa City City Council adopted a new "Buy Local" procurement policy at a meeting April 17. The policy would allow local business bids coming within 5 percent over a non-local bid to reduce or match the non-local price.

The new purchasing policy has excited local business-owners.

Bill Nusser, the owner of Hands Jewelers, 109 E. Washington St., said the move is a step in the right direction.

"I think this is a real indication of where our city management is going," Nusser said. "I am impressed, and I think it is a really great move."

City officials said they are aiming to create a competitive market and give local businesses better opportunities.

"We want to make sure that we have fair competition, but we also want to make sure local businesses have the opportunity to match or provide a quote that is less than the lowest bid," said Mary Niichel, the purchasing agent for the City of Iowa City.

Businesses that want to compete against non-local businesses under the policy must have previously been in the bidding process.

Nick Arnold, the executive director of the Iowa City Downtown District, said the allowance will help keep city funds in local businesses.

"Speaking for the Iowa City Downtown District, this policy will help keep municipal funds in local businesses, which is obviously beneficial to those owners and employees," he said in an email. "It also demonstrates the city’s commitment to supporting local merchants."

The city’s purchasing policy was also outdated, Niichel said, leading city officials to believe it was a good time for updates.

Ritu Jain, the owner of Textiles, 109 S. Dubuque St., said bringing in local businesses can help the city know the quality of work beforehand, and she thinks the community will respond well.

"Iowa City is a very shop-local community, and everybody is interested in keeping business local," she said. "Keeping it local is always a good thing."

Cedar Rapids City Councilor Chuck Swore said the Buy Local policy — which was implemented in Cedar Rapids in January 2010 — has not affected larger purchases, but it does play a role when looking into smaller business ventures.

Despite the possibility for stipulations depending on the project, purchasing process, or source of funding, City Councilor Jim Throgmorton said the new policy will give businesses more opportunities for fair competition.

"I think it will stimulate small businesses," he said. "[The policy] will give businesses a better opportunity to compete fairly."

Arnold said he believes the initiative will have no problem in Iowa City because of the number of local businesses in place.

"The vast, vast majority of businesses are locally owned and operated," he wrote in an email. "I would wager college towns are more supportive of local businesses than other communities."

Swore said he did not know of other cities who had the policy.

"I hope other places adopt it, too," he said, and he believes it was a better idea than awarding tax dollars to non-local businesses. "I think it is something you will see more and more."