[SML] Removing hazardous equipment from service

[Dan Monti]

To the collective... 
I am searching for the proper means by which I might deactivate a bad idea. My current example is out of industry, but the principals apply.

We have a materials lift in the warehouse that has seen better days, but was a bad idea as conceived. There are no travel limits, no apparent brake, motor or otherwise, no cable retention rollers on the drum, the car is falling apart, the worm drive has probably lost all its oil given the look of things... Due to the lack of cable retention and limits, the car has previously been landed in the basement taking tension off the cable which is now all up and under itself on the drum... The only saving grace is that there are two full wraps on the drum cable before the stupid gnarly bit. 
Lets simply say that there are management issues.

 I thought that OSHA Lockout-Tagout was the means, although upon investigation I am no longer of that opinion as the LOTO program is specifically designed for servicing and maintaining equipment not taking it out of service. 

Soooo... Am I missing something? Is this a procedural vacuum legally? How do you take a hazardous piece of permanent equipment out of service?
Thoughts? Perspectives? Experiences...?
Thank you in advance,Dan
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