And just last week, reported in the CBC, a NAFTA panel ruled in favour of Exxon Mobile and Murphy Oil in a Nova Scotian dispute over whether the provincial government could require oil companies to spend a portion of their R&D monies studying local issues.

"What's thrown in my face more often than not is what about NAFTA and TILMA and the AIT and so on and so forth -- those trade agreements and how (cities) get around them," said CUPE president Barry O'Neill.

O'Neill has spent the last year proposing B.C. businesses, institutions like hospitals and schools, and city governments purchase 10 per cent of their services and good procurements from local companies. That policy platform was featured in a previous Tyee article, and O'Neill said it was meant for more than just union members; private companies with non-unionized labour would benefit too.

"It may be surprising to some, but 16 of the largest cities in the United States, and 21 counties, have a program of procurement in their communities," he said, noting many places offer a "lift" between seven and 14 per cent on contracts given by schools, city governments and regional districts to local businesses.

The States "are kind of the free market capital of the world," he said, adding Canadian procurement laws are "silly." "Somebody may challenge us but that hasn't happened in the United States."

O'Neill said the benefits of a local procurement policy -- in terms of more jobs and locally-circulated revenue -- would be more than worth the potential litigation.

A spokesperson with CUPE pointed to a 2007 study contracted by the Grand Rapids wing of LocalWorks, a campaign organization set up to promote sustainable community policies. The study looked at how local procurement dollars flowed through Kent County, Michigan. It found a 10 per cent shift to local suppliers by county companies and local governments could net an extra US$137 million in economic output and create 1,600 more jobs. The county's population size is roughly equivalent to that of the City of Vancouver -- 600,000.

City drops local companies

Some Canadian cities have started to take up the challenge of pursuing local procurement strategies -- so far as food policy is concerned. Toronto City Hall approved a goal in 2010 requiring 50 per cent of its purchased food to be local, said Robinson. Johnston said Vancouver may be looking into implementing something similar.

But Robinson added, "Food is a simple supply chain; it's either local or it's not." In contrast, "Office and cleaning supplies, and other goods, must face direct competition from multinational firms. And they do so at a disadvantage the way the city currently assesses bids on contracts."

Mills says he is still trying to figure out how his company lost their City contract to Grand & Toy, a subsidiary of Office Max.

The "problem with our business is you can quote out 500 items, but you may have 5,000," he said. He added he was still trying to get specifics from the city on which items their competitor offered cheaper.

The lost city contract cost Mills Basics $600,000 in business, Mills said, adding he had to fire three of the company's 100 workers as a result.

"We have our purchasing department here. We have customer service here," said Mills, noting the company operates an eight-person call centre in the Metro Vancouver region. Normally, he said, those services would be centralized in a bigger company, and thus situated out of region.

Unlike Grand & Toy, he added, his company tries to purchase all its supplies from North American manufacturers.

Robinson said businesses such as Mills Basics need to be supported if the city is to achieve true economic and social sustainability.

"If you look at it purely on price, you're not looking at the trickle down effect," said Robinson. "If you save that two per cent on the bottom line of your contract, you're causing unemployment with local companies. They buy from local companies who also suffer if those local companies suffer."

She said Vancouver city councillors have expressed support for pursuing local procurement policies, even if that means taking on NAFTA and other free trade agreements that limit those options.

"But they don't realize what's going on in their own procurement department," she said.