Our Blog

What is the ideal length of a maintenance contract in public buildings?

Too often, public assets (with the exception of Federal Government sites which typically have a 25 year maintenance contracts) are tendered every three to five years in an effort to ensure that the elevator maintenance is in line with market pricing or to replace a poorly performing elevator contractor. However, what we discovered overtime with numerous inspections of the elevators during the maintenance term is a lack of maintenance and focus by the elevator contractors. We do not believe that this is a malicious or intentional act but cause and effect driven by a system that does not reward performance, just bottom fees. In fact, we are of the opinion that most of the elevator contractors do not perform any significant preventative maintenance because they do not get rewarded for their efforts. In private enterprises, good performing companies do not get replaced by contractors who underbid them by few dollars. Since performance is not rewarded in public entities, there is no motivation to perform at any reliable or consistent level. Given the cost involved in generally capital intensive elevator maintenance programs, elevator contractors cannot afford to perform the required maintenance at the reduced costs require to bid and retain these job without means or ways to recoup their investments. Elevator contractors end up performing a reactive maintenance or callback maintenance on the elevators causing their reliability to suffer and deteriorate until the public asset deteriorates and become unmaintainable forcing the public entity to modernize the elevators. Therefore, given that public entities cannot 'favour' one contractor versus the other based on relationship (known to do good work) or performance of existing contract (given that any qualified public business has the right to bid), the only smart solution is to provide bidders with a long term contract which enables them to recoup their investments and cost over the life of the contract. The theory is simple, the contractor has a choice to perform a good job or not. Public entities should evaluate the contractor's performance on a monthly basis. Public entities should then evaluate the efforts of the contractor and preventative maintenance program in place through a web bases system which monitor compliance to government requirements and callbacks. If the contractor is not implementing a preventative maintenance program, then public entities should exercise their option to terminate the contract for non-performance within the desired period bases on a dialogue and working relationship with the contractor. If the contractor is performing well, then a formal 'grade' is then implemented in year three (3) to determine the metric of performance. Provided that no concern is noted, the contractor gets another evaluation in year eight (8) and then another in year twelve (12). If a concern is detected in any of the anniversary periods, then a follow-up inspection is performed in the following year to ensure that the concern is addressed. So, when you ask what is the ideal elevator maintenance contract length for public housing or city contract is? We believe that it should be bases on two halves of 30 years (the ideal elevator product life cycle). So 15 years for the first contract and then 15 years for the second half. This would allow the public entity to take the elevators from construction to mid-life to modernization or to the end of the elevator's useful life.