diff --git a/src/vnsw/agent/oper/test/test_aap.cc b/src/vnsw/agent/oper/test/test_aap.cc
index f621370b883..ec7f80c9792 100644
--- a/src/vnsw/agent/oper/test/test_aap.cc
+++ b/src/vnsw/agent/oper/test/test_aap.cc
@@ -528,6 +528,24 @@ TEST_F(TestAap, StaticMachine_11) {
     EXPECT_TRUE(path->path_preference().static_preference() == false);
 }
 
+//Verify that static preference is not populated
+//when preference value is set to 0
+TEST_F(TestAap, StateMachine_12) {
+    AddStaticPreference("intf1", 1, 0);
+    Ip4Address ip = Ip4Address::from_string("1.1.1.1");
+    EXPECT_TRUE(RouteFind("vrf1", ip, 32));
+
+    InetUnicastRouteEntry *rt =
+        RouteGet("vrf1", ip, 32);
+    const AgentPath *path = rt->GetActivePath();
+    EXPECT_TRUE(path->path_preference().sequence() == 0);
+    EXPECT_TRUE(path->path_preference().preference() == PathPreference::LOW);
+    EXPECT_TRUE(path->path_preference().ecmp() == false);
+    EXPECT_TRUE(path->path_preference().wait_for_traffic() == true);
+    EXPECT_TRUE(path->path_preference().static_preference() == false);
+}
+
+
 int main(int argc, char *argv[]) {
     GETUSERARGS();
     client = TestInit(init_file, ksync_init);
diff --git a/src/vnsw/agent/oper/vm_interface.cc b/src/vnsw/agent/oper/vm_interface.cc
index 9b35c571b04..18dbf008509 100644
--- a/src/vnsw/agent/oper/vm_interface.cc
+++ b/src/vnsw/agent/oper/vm_interface.cc
@@ -634,9 +634,15 @@ static void BuildAttributes(Agent *agent, IFMapNode *node,
     //Extract the local preference
     if (cfg->IsPropertySet(VirtualMachineInterface::PROPERTIES)) {
         autogen::VirtualMachineInterfacePropertiesType prop = cfg->properties();
-        data->local_preference_ = VmInterface::LOW;
-        if (prop.local_preference == VmInterface::HIGH) {
-            data->local_preference_ = VmInterface::HIGH;
+        //Service instance also would have VirtualMachineInterface
+        //properties field set, pick up local preference
+        //value only when it has been initialized to proper
+        //value, if its 0, ignore the local preference
+        if (prop.local_preference) {
+            data->local_preference_ = VmInterface::LOW;
+            if (prop.local_preference == VmInterface::HIGH) {
+                data->local_preference_ = VmInterface::HIGH;
+            }
         }
     }