Federal buildings, VA clinics and military bases buy HVAC preventive maintenance (PM) contracts: scheduled inspections and service of chillers, boilers, air handlers, rooftop units and controls, plus service calls. They're usually priced per year with option years, and they're very winnable for small mechanical contractors who price the hours correctly.
1. Which wage rules apply
- Maintenance and service work is normally covered by the Service Contract Act. The wage determination lists minimum rates for titles such as HVAC mechanic, plus health and welfare, vacation and holidays.
- Repair, alteration or replacement work that counts as construction (for example replacing a chiller) falls under Davis-Bacon rates instead. Some contracts include both, so check which line items use which wage determination. See Davis-Bacon wages explained.
2. Start from the equipment inventory
A good solicitation attaches an equipment list: each unit, make, model, size and location, plus the PM tasks and how often (monthly, quarterly, semi-annual, annual). If there's no list, ask for one in writing, or price from a site visit.
3. Worked example
The numbers below are illustrative only. Use the solicitation's wage determination, equipment list and your own PM times.
| Equipment | 12 rooftop units, 4 air handlers, 2 boilers, 1 chiller |
|---|---|
| PM hours per year | Rooftop units: 12 × 4 quarterly visits × 1.5 h = 72 h. Air handlers: 4 × 4 × 2 h = 32 h. Boilers: 2 × 2 × 4 h = 16 h. Chiller: 1 × 4 × 6 h = 24 h. Total 144 h |
| Travel, access and reporting | Example: 20% = 29 h, total 173 h |
| Labor cost per hour | Example: $34.00 wage + $5.00 H&W + $3.40 vacation and holidays + $5.61 taxes and comp = $48.01 |
| Labor per year | 173 × $48.01 = $8,306 |
| Filters, belts, chemicals | Example: $3,200 a year |
| Overhead and profit | Example: 18% = $2,071 |
| PM price per year | About $13,577 |
4. Service calls and repairs
- Many contracts have separate line items for service calls (an hourly rate, often with a response-time requirement such as 4 hours for emergencies) and a repair allowance or not-to-exceed amount for parts.
- Price hourly rates for normal and after-hours work from the wage determination, and read how parts markup is allowed.
- Response-time requirements drive staffing: a 2-hour emergency response 24/7 needs on-call coverage you must pay for.
Common mistakes
- Pricing PM from your commercial flat rate instead of the wage determination.
- Forgetting travel, badging and escort time on secure sites.
- Missing a refrigerant certification, boiler license or controls brand requirement.
- Ignoring the emergency response time when staffing.
- Not pricing every option year and line item.
Frequently asked questions
Is HVAC maintenance covered by Davis-Bacon or the Service Contract Act?
Routine maintenance and service is normally covered by the Service Contract Act. Repair, alteration or replacement that counts as construction is covered by Davis-Bacon. The solicitation tells you which applies to each line item.
How do you price an HVAC preventive maintenance contract?
Multiply each unit's PM time by its visits per year, add travel and reporting time, cost the hours from the wage determination, add materials, overhead and profit, then price service calls and repairs separately.
Related
Government HVAC contracts · VA HVAC contracts · Open HVAC and plumbing contracts
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