In Pick&Mix, local criteria are the criteria which do not exist in a benchmarking methodology (neither as core criteria nor as supplementary criteria) but are created by an institution and then scored just by that institution.
Each such criterion must have the same "flavour" as the criteria within the methodology (same number of scoring levels, same style of scoring statements, etc). Indeed, there are some methodologies such as MIT90s where every criterion is local.
Creation of local criteria is a somewhat specialist art, but there is some documentation available, such as the paper "Creating Criteria for MIT90s and Pick&Mix".
An example might be to convert some of the key performance indicators in an e-learning strategy into local criteria as a way of ensuring that they are regularly analysed.
Note that in Pick&Mix the range 30-49 is reserved for local criteria.