Many of us managing community associations are fortunate
to have an in house maintenance staff at our disposal to perform
the routine tasks that are primarily driven by an effective work
order system. In most cases, members of the in house maintenance
staff are generalists in that they have the training, skills and
tools to handle the day-to-day repairs required to maintain the
common elements of the community association. Fewer of us, however,
have maintenance personnel at our immediate disposal who are trained
to perform larger repair and replacement work on such common elements
as vinyl siding and roofing. In either case, whether or not the
project is large or small, it becomes the job of the Manager to
guide the Board of Directors through the process of evaluating
whether or not to outsource a particular project.
Clearly, a wise Manager first acknowledges to the
Board of Directors the importance of recognizing that each maintenance
project is unique and must be evaluated independently. Since there
are basically five types of maintenance programs, most Managers
incorporate their on the job training with their formal education
to determine whether a project should be assigned to the in house
staff or contracted out. The five basic maintenance programs considered
are: (1) Routine, (2) Preventive, (3) Emergency, (4) Requested
or Corrective, and (5) Scheduled.
The Manager is ultimately responsible for guiding
the Board through the steps necessary for an association to transfer
workforce liability away from itself whenever possible, using the
most cost and time effective methods available to complete a project.
The astute Manager must tailor his or her approach to the community's
needs, analyze the work requirements, and ultimately respond with
the best decision-making methods. In many cases, the Manager will
need to develop project specifications and solicit at least three
contractor bids before knowing whether to begin evaluating his
or her staff for this work.
The following seven criteria should be utilized in
all or part when deciding whether maintenance projects should be
done in house or by outside contractors. Further, the pros and
cons for each criterion will become apparent once the comparisons
are made for each project.
Personnel
Know your staff's skill levels and training. Answer
these questions: Is it possible to train your staff in a timely
fashion? Will your staff be able to perform this project in addition
to handling their normal routine work? Will an outside contractor
be better able to find skilled workers for this project? Does the
manager have the time to supervise this project? Would it be better
for an outside contractor, under a contract including performance
provisions, to be bound to not only supervise the work crew but
also to ensure performance standards?
Time
Is the project at hand an urgent one or can it be
completed on an “as available” basis? The Association's staff has
a clear advantage to already being on site and knowing the basics
of the job. The Manager needs when evaluating available staff time
to include all aspects of the work at hand including, for instance,
preparatory work and clean up time. Is this the most time effective
(i.e. cost effective) project for your in house staff to be completing?
Cost
Evaluate cash outlay and real labor costs. The Manager
must determine the true cash outlay or cost if utilizing staff
employees. Determine an hourly rate per staff person (including
benefits) so that a calculation can be made based upon a time estimate
to complete the work.
Tools, equipment and supplies
The Manager needs to determine if the tools, equipment,
or supplies needed for the project at hand are already available
to the staff. Will the purchase of these items be used for other
projects, thereby incurring the expense now but realizing a cost
savings later? Can your staff utilize a local rental company for
the equipment needed and at what cost? (An outside contractor would
typically provide its own equipment and would include these items
in the proposal.)
Insurance coverage
Most Associations require a minimum of $1,000,000
of bodily injury and property damage coverage by outside contractors.
Does the Association also carry this amount on their employees
for this type of project? The Manager should review, as applicable,
liability coverage, vehicle coverage and workers compensation coverage.
The Manager should also speak with the Association's insurance
agent to confirm the coverages currently held for the staff. It
cannot be recommend strongly enough that, when possible, liability
should be transferred away from the Association.
Licenses and permits
Each municipality maintains control over licensing
and permits for certain types of projects. The Manager should check
into this carefully if the work is to be done in-house as these
permitting costs can be significant. If the contractor's proposal
includes the purchase of permits and licensing, make certain that
these items are indeed obtained should the work be given to the
contractor.
Storage facilities
With safety and liability in mind, the Manager needs
to assess whether the tools, equipment and supplies for the project
can be stored by the Association to prevent theft and accidents.
The aforementioned techniques should be applied in
determining whether to use staff members or outside contractors
for most projects. However, in some cases the process described
above is unnecessary based upon the size and cost of the task at
hand. It may be obvious to the Manager that a particular project
is absolutely perfect for the in-house staff or absolutely impossible
for them to complete. Each Manager knows his or her staff best.
Based upon a thorough knowledge and evaluation of
your staff's skill levels, you will likely know what your staff
is capable of accomplishing. Maintenance staff personnel often
handle fence repairs, siding repairs, small roof leaks, electrical
jobs, power washing and perhaps even welding. Their skills are
primarily maintenance oriented and are work order driven. The ongoing
replacement work at the majority of older communities is often
substantial in scope and several large scale projects may be underway
at once. The in house staff may not be able to perform these major
projects simply because doing so would eliminate the staff's ability
to stay current with routine work. It should also be noted that
certain necessary seasonal work may prevent the undertaking of
large projects even where the skills for such exist among on-site
staff.
Before any recommendations can be made on whether
an in house person or an outside contractor should be utilized
for a given maintenance project, a thorough evaluation of the current
work order system's summary reports should be conducted by the
Manager for the Board's review. In this way, the Manager can evaluate
trends with regard to seasonal work orders such as gutter cleaning
and snow removal while at the same time providing all of the information
at hand to the Board for a long range decision.
As we all know, the less expensive course is not
always the best for the association. However, utilizing the techniques
herein can help to highlight pros and cons in the process of evaluating
whether a project should be completed by on site staff or by an
outside contractor. It always pays to choose wisely!
