The D.C. Council held a hearing Friday to get to the bottom of why Mayor Vincent Gray's administration canceled a multi-million dollar grass-cutting contract with a Maryland company in favor of a more expensive company.

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What the councilmembers got was a lesson in how hard it is to do business with the city and how District residents are losing out on jobs.

Denise Shelton was called before the D.C. Council to prove her company, Community Bridge Incorporated, is really a D.C.-based small business and therefore entitled to preferential treatment when bidding on government contracts.

Shelton wasted no time making it clear her company is a local company.

"Seventy-one percent of our employees live in the district, this means our company pays payroll taxes for each of these employees," Shelton said.

Once that issue was resolved, the focus turned to whether or not local businesses that do get government contracts should have to hire D.C. residents.

While some residents think it should be a requirement, city regulations only require the owner of the business live and pay taxes in D.C. There are no requirements they hire D.C. residents.

D.C. Councilmember David Catania says he will propose legislation requiring any company certified as a local business hire at least 35% percent of its employees from D.C.

But Catania and other councilmembers were upset to hear just how hard it is to do business with the city.