Jurisdictions Outsource Maintenance to Improve Facility Operations
As agency budgets are frozen or cut amid the economic downturn, facility managers are outsourcing maintenance operations to ensure their buildings too extend the life of their building systems.
In July, CGL Engineering expanded its maintenance facility services in Georgia with a contract to manage more than 3 million square feet at six Department of Corrections facilities and seven regional crime labs. Since 2001, the company has expanded its services to 32 juvenile facilities in the state.
The initial three-year contract, which has an estimated value of more than $22 million, includes renewal options of up to four additional years that could increase the value of the contract to more than $49 million. It was initiated after the DOC was unable to offer a competitive wage for skilled craftsmen in metropolitan areas.
“We wanted to bring high-skilled craftsmen on board to perform maintenance,” says David Clark, project management and capital assets manager for the engineering department of the DOC. “Prisons may not sound technically challenging, but the fact is, there is a fair amount of technology. It was our desire to bring a higher level of maintenance to the facilities that are close to the metropolitan areas.”
A team of more than 60 full-time regional and on-site maintenance technicians will service the Georgia facilities after the transition to outsourced maintenance services is completed in the fourth quarter of 2009.
“If we were doing our job very well to start with, which is not necessarily the case, it would have a very minimal impact on the operation of the facility,” he says.
“We believe that because they are in a position to do a better job with maintenance, it will improve the operations of the facility.”
Problems were particularly acute at the two largest DOC facilities under the contract, Metro State Prison in Atlanta and Georgia Diagnostic and Classification Prison, 40 miles south of Atlanta in Jackson, Ga.
“We were having such difficulties keeping maintenance functioning at the two facilities that there were real problems,” Clark says. “At some point, it can go downhill far enough where it is difficult to operate the facility. We are trying to do away with those types of problems with this contract.”
Under the contract, CGL will oversee maintenance for HVAC, plumbing and electrical systems, along with more specialized components, such as electronic security and detention hardware.
Outsourcing routine maintenance under the contract will allow the DOC to increase funding for more specialized work.
“The motivation for the contract was not cost savings,” Clark says. “We believe that with the contract — and the initial number are verifying this — our costs are going to go up 10 percent to 15 percent for maintenance. But, we are hoping the additional costs will buy improved quality.”
Dexter Stanphill, principal in charge and president of facility engineering and maintenance of CGL Engineering, says initial costs increased because the agency is being proactive with preventative maintenance instead of waiting for a problem to appear and then fixing it. However, the contract could create long-term cost savings, he says.
“If you are not spending anything on maintenance and then you start doing maintenance, your costs will go up,” says Stanphill, who prior to going CGL, served as director of engineering and construction at the Georgia DOC.
The green building movement is also having an impact on maintenance and operations as infrastructure systems that deliver energy savings and reduce environmental impacts become more complicated.
As systems become more complex, the hiring and training process becomes more difficult. Oftentimes, a jurisdiction will hire and train someone only to have that person leave for greener pastures, Stanphill says.
With CGL’s plan, 70 percent of maintenance is preventative and 30 percent is corrective, which will reduce lifecycle costs, resolve life safety and code issues and brings expenditures for major infrastructure hardware back on schedule, Stanphill says.
Additional savings can be achieved through elimination of expenditures associated with full-time in-house staff, including training expenses, medical insurance and retirement benefits.
“There is a lot more interest in outsourcing now because most counties and states are beginning to realize there are huge long-term costs associated with full-time employment,” Stanphill says. “If they can find reliable people to privatize with, that reduces their long-term budgetary costs.”
About 30 full-time jobs in Georgia were affected by the CGL contract.
“The craftsmen positions at two facilities basically went away,” Clark says. “In most cases, we were able to transfer people to similar jobs at other locations.”
In addition to comprehensive maintenance packages, such as the one CGL is providing in Georgia, companies offer maintenance services for specialized areas of correctional facilities.
The Southwest regional office of Norment Security Group, a company best known for detention and security electronics contracting services, has provided maintenance services for the Arizona Department of Corrections for more than 15 years.
“Over the years the state has gone through a building program where they built new prisons,” says Howard Pearsall, Norment’s southwest regional manager. “We were involved in building them, then we were involved in the warranty, and when they came out of the warranty, they slid it into a contract.”
The company supplies 17 employees with extensive security electronics experience and training for maintenance in Arizona. It also provides maintenance services in 18 other states.
CGL’s Contract in Georgia
Following increased interest in outsourcing maintenance needs during the last two years, Norment has boosted its presence in the sector with the addition of a new employee dedicated maintenance contracts.
“I think the increased interest has to do with people who have older systems that they were thinking about replacing, and then the economy kind of turned around on them and they are going to have to live with the systems a lot longer,” Pearsall says. “They want to have a method in place to ensure that the systems are going to last.”
The company recently hired Paul Parks as national director of marketing for its service operations. He is task with expanding maintenance services with new and existing clients.
“I think there is a lot of opportunity out there, especially for the jobs that Norment has done,” Pearsall says. “There is a lot of opportunity to go back in for upgrades and expand their services.”