Episode 5: Putting it into Practice – RFPs, Contracts, and Contractors
This is article is the fifth in a five-part series on sustainability in the condominium context. Read Article four here.
To recap our discussions over the preceding four articles:
We have discussed various sustainability measures.
We have discussed the abilities that the board of directors has to make changes to the common elements and units.
We have discussed how to check the “will of the owners” via surveys or similar processes.
We have discussed how a condominium corporation can create formalized policies for sustainable action.
In this article we’ll discuss how we can use the groundwork we have laid towards real results in reducing power, water, and fossil fuel use, and CO2 emissions.
Requests For Proposals
A Request For Proposals (RFP) is a formalized process by which the purchaser (the condominium corporation) details its specific needs and wants (among other things). The goal of an RFP is to allow a transparent process to take place where bidders are protected from potential conflicts of interest of the management firm and bid on the same and known scope of work.
A good RFP process yields contractors that are vetted and experienced, provide accurate bids, and allows the purchaser to know they are getting the best of what is currently available.
Typically, an RFP document outlines the work to be done, such as the repaving of a parking lot. It provides any plans or prints that are commonly required, assigns a date by which the bid is to be submitted, a date the work is to be completed, and information on when and how the vendor will be paid.
An RFP can also include other information, such as that the purchaser is looking for specific energy efficiency ratings. This can also be expanded to detail how the corporation views sustainability, how it aims to reduce energy, water, and fossil fuel use. It can explain that it is not looking for the absolute-lowest price if it means sacrificing its sustainability goals. It can explain that it is looking for a low price, given that its needs of sustainability are met.
This additional information in an RFP in turn allows the vendor to bid a package according to what the purchaser wants, not what the vendor thinks the purchaser wants. The result is a better bid, that better matches the condominium corporation’s goals.
Contracts
The contract process comes after a winning bidder has been selected from the RFP process. Contracts offer an additional method of incentivizing the behaviours that the condominium corporation values.
Broadly, two parties can agree to pretty much anything, so long as it is legal. This agreement is written up in a contract. Vendors often have their own standard contracts, but there is nothing saying that these can’t be modified. Like everything else, these are a negotiation. Both parties can withdraw if they cannot come to an agreement.
Via a contract, the condominium corporation can mandate that a landscaping vendor uses only electric equipment onsite, as the two-stroke engines that are common in small engines are loud, inefficient, and produce high amounts of CO2 and smog-forming emissions. Alternately, the corporation can use the vendor’s own contract (without the equipment restriction), but add in a clause where the vendor receives a bonus if they use electric equipment a minimum of 50% of onsite-man hours. The vendor is thus incentivized to invest in equipment they may not already have and can use this equipment at other sites (thereby compounding the condominium corporation’s impact on sustainability).
A board’s and manager’s imagination is the limit here. It can mandate that vendors use electric vehicles when working onsite, that waste generated by onsite work is properly recycled, that all paint used onsite is low-VOC and waste is disposed of properly, that recycled materials are used where possible, or anything else they believe may positively impact the sustainability of the condominium.
Contractor Due Diligence and Monitoring
Prior to signing a contract, due diligence should be completed. The corporation should check to see if a vendor promising a certain product or method has the capacity to do so. It can check references and vendor qualifications, among others.
During the period work is conducted onsite, the corporation should be conducting spot checks to see if the equipment used onsite, or materials installed meet specifications.
Summary
Over the last 5 articles we have explored different the full scope of incorporating sustainability into the operation of a condominium corporation. A board of directors has the opportunity to take action to significantly reduce the impact of condominium life on the environment.
Michael Trendota, MBA, CPM, RCM
President
Michael is a condominium management professional with experience working closely with condominium corporations, board members, and residents. Using his experience building and operating small businesses, he focuses on creating high-performing teams delivering excellent results to owners, residents, and partners. He has experience operating multi-location properties with large and diverse teams. Michael holds a Masters of Business Administration from Queen’s University, is a Certified Property Manager, a Registered Condominium Manager, and is a CMRAO licensed Condominium Manager.
Michael serves the condominium management industry in several additional capacities. He teaches Physical Building Management and Financial Management at Mohawk College. These two courses form part of the mandatory curriculum for condominium managers in the Province of Ontario. Michael also sits on numerous boards and committees, such as the Association of Condominium Managers (ACMO) membership committee, is a frequent guest speaker and lecturer at the Canadian Condominium Institute (CCI), among a variety of other engagements.
* Though written by a qualified and experienced Condominium Manager, this article is not intended as legal advice. Our team is available to discuss formal advisory relationships.
