Wastewater Asset Management Plan

Transcription

1 Wastewater Asset Management Plan This Asset Management Plan (AMP) is based on the best information available when it was completed in December Council decision making both with regard to programmes that are implemented and the timing of the programmes in the context of the Year Plan has yet to be finalised. The programmes in this AMP have been used as a planning tool to inform the 10 Year Plan planning process. The actual programme of work that Council plans to implement will be that in the adopted Year Plan following formal public consultation. This document was prepared by Palmerston North City Council, City Networks, Water and Waste Services Division. Name Signature Date Prepared by: Phil Burt Robert van Bentum Dec 2017 Reviewed by: Phil Walker Feb 2018 External Peer Review by: AECOM Ltd March 2018 Approved for Issue by: Version No. Reason for Amendment Date D Peer Review Feedback Incorporated April 2018 PNCC Reference No: Water & Waste Division Palmerston North City Council l Private Bag l Palmerston North P: +64 (6) l F: +64 (6) l

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3 Contents Executive Summary... i 1 Overview Purpose of this Plan Relationship with Other Plans AMP review process Changes to AM since Navigating the AMP The Activity Activity Description Palmerston North Main Urban Area Ashhurst Aokautere Linton (Excluding Army Camp & Prison) Bunnythorpe Longburn Activity Rationale Key Relationships LGA Section 17A Review Significant Negative Effects of the Activity Significant Changes to the Activity Strategic Environment Internal Strategic Context Council Vision, Goals & Strategic Direction Infrastructure Strategy External Strategic Context Horizons Regional Council One Plan Statutory and Regulatory Requirements Key Legislation Local Bylaws Standards & Specifications Asset Management Policy & Strategy Asset Management Policy Asset Management Strategy Levels of Service Introduction Community Input & Decision Making Process Communication of Levels of Service & Performance Measures Current and Future Levels of Service & Performance Measures Key Performance Indicators... 25

4 4.4.2 Future Changes to Levels of Service Service Level Gaps Growth and Demand Future Demand Drivers Growth Projections Population Growth National Policy Statement Urban Development Capacity Household Growth Residential Development Type Residential Growth Strategy Industrial Growth Strategy Office and Retailing (Commercial) Land Use Strategy Rural Residential Strategy Other Demand / Consumption Projections / Patterns Wastewater Collection Services Demand/Wastewater Production Trends Changes to Water Use Pattern Projected Flows & Loads Wastewater from Private Systems Wastewater from Other Sources Stormwater Inflow & Infiltration Regional Council One Plan Standards National Policy Statement Freshwater Management Technology Changes Demand Management Sensitivity to Demand Changes Climate Change Impact on Demand Assets & Lifecycle Management Overview of Wastewater Network Assets Description of Assets Wastewater Supply Asset Components The Wastewater Collection Assets The Western Trunk Sewer Main Catchment Featherston/Tremaine Trunk Catchment Ferguson Street Trunk Catchment Eastern Trunk Catchment Confluence of Trunks Aokautere Reticulation Linton Reticulation Ashhurst Reticulation Bunnythorpe Reticulation Longburn Reticulation Wastewater Collection Asset Attributes... 53

5 6.3.1 Wastewater Collection Asset Condition Wastewater Collection Asset Capacity and Performance Wastewater Pump Station Assets Wastewater Pump Station Asset Attributes Wastewater Pump Station Asset Condition Wastewater Pump Station Asset Capacity and Performance Wastewater Treatment Assets Wastewater Treatment Asset Attributes Wastewater Treatment Asset Condition Wastewater Treatment Asset Capacity and Performance The Telemetry and SCADA Assets Description of Assets Activity Management Support Services Increases in Services (Operating Programmes) Asset Systems Database Infor Public Sector Network Hydraulic Modelling Water Services Assessment Operation & Maintenance of Assets Overview Operation & Maintenance Strategies Operation & Maintenance Costs Operation of Wastewater Assets Maintenance of Wastewater Assets Operation & Maintenance Delivery Delivery of Programme Renewal of Assets Overview Renewal Strategies Long Term Renewal Profile Renewal Programme Delivery of Programme Development of Assets Overview Development Strategies Development Programme Delivery of Programme Non Asset Programmes Disposal of Assets Key AMP Improvement Projects Relating to Asset Lifecycle Management Risks & Resilience Corporate Risk Management Framework... 93

6 7.1.1 Risk Management Policy Strategic Risks Operational Risks Project Risks Risk Management Hierarchy Asset Criticality Resilience Risk Management Process Activity Risk Management Approach for the Activity Role of Activity as a Lifeline Utility Critical Assets Resilience Sources of Risk Reference Documents Key Risks to the Wastewater Activity Operational Failure Asset Failure Project & Planning Risks Natural Disasters Events & Incidents Resilience of Infrastructure to Natural Disaster Introduction Seismic Hazard Flooding Hazard Volcanic Hazard Other Natural Hazards Interdependencies Risk Management Strategy Risk Management Program Civil Defence Preparedness Emergency Events Emergency Response Plan Business Continuity Plan Recovery Lifeline Utilities Coordination Risks and Resilience Improvement Plan Sustainability Eco City Strategy Climate Change Approach Taken in This Plan

7 9 Financial Projections & Trends Long Term Financial Forecast Proposed Operation & Maintenance Expenditure Proposed Renewal Expenditure Proposed New Capital Expenditure Trends in Thirty Year Forecast Asset Valuation Confidence levels Reliability of financial forecasts Maintenance and Renewal Forecasts Development Forecasts Potential Effects of Uncertainty Funding policy Operation and maintenance Capital renewal Capital development Development contributions Assumptions Asset Ownership and Provision of Service Population Growth Residential Growth Industrial Growth Retail Growth Rural-Residential Growth Levels of Service Construction Costs Maintenance & Operational Costs Inflation Depreciation Vested Assets Service Potential Asset Lives Natural Disasters Council Policy Interest Rate Treatment Plant Upgrade Continuous Improvement Overview Programme Planning and Implementation Project Status Development Works Planning Residential Growth and Industrial Growth Planning (refer to Section 5)

8 Demand Projections (refer to AMP Section 5) Risk and Resilience (refer to AMP Section 7) Council Strategies (refer to AMP Section 3) Renewal Works Planning Condition Data Operations and Maintenance Operations and Maintenance Strategy Internal Service Level Agreements Market Comparability Procedure Asset Information Asset Management Plan Improvement Asset Management Resources Loss of Key AM Knowledge Skill Gaps Levels of Service Review AMP Improvement Plan (2017) Appendices Appendix A. Appendix B. Appendix C. Appendix D. Appendix E. Appendix F. Appendix G. Appendix H. Appendix I. Appendix J. Appendix K. Glossary Requirements of the LGA 2002 Technical Performance Measures Risk Analysis/ Framework & Register 30 Year Financial Forecasts Resource Consents Asset Grading Definitions Pump Station Asset Data Data Management 6 Year Asset Renewal Programme Final Peer Review Report Table of Figures Figure 1: Relationship between Council Planning Processes... 2 Figure 2: AMP Structure... 5 Figure 3: Schematic Layout of Wastewater System... 8 Figure 4: Map of Wastewater Collection Areas... 9 Figure 5: Map showing location of proposed residential development Figure 6: Map of NEIZ Infrastructure Roll Out Figure 7: Map of Existing Industrial Zone at Longburn Figure 8: Map of Spatial Extent of the Business Zones... 41

9 Figure 9: Average Daily Demand of Metered Properties Figure 10: Historical Metered Non-Domestic Water Demand Figure 11: Breakdown of Average Daily Water Consumption for 2016/ Figure 12: Wastewater Catchments Figure 13: Wastewater Supply Asset Component Groups Figure 14: Wastewater Pipe Age Figure 15: Wastewater Pipe Material Figure 16: Wastewater Pipe Diameters Figure 17: Location of CCTV Surveys Completed Figure 18: Pipe Blockage and Breaks by Pipe Age Figure 19: Pipe Blockage and Breaks by Pipe Diameter Figure 20: Pipe Blockage & Breaks Long Term Trends Figure 21: Catchment Inflow & Infiltration Figure 22: Location of Wastewater Pump Stations Figure 23: Photo of Wastewater PS in Grand Oaks Drive Figure 24: Totara Road Wastewater Treatment Plant Schematic Figure 25: Field Inspector Screen Shot Figure 26: IPS Screen Shot Figure 27: Wastewater Treatment Operations & Maintenance Staff Figure 28: Wastewater Pipes Profile Based on Expected Asset Life Figure 29: Risk Management Hierarchy Figure 30: Risk Management Process (AS/NZS ISO 31000:2009) Figure 31: Thirty Year Operation & Maintenance Expenditure Forecast Figure 32: Thirty Year Projected Renewals Expenditure Figure 33: Thirty Year Projected New Capital Expenditure Table of Tables Table 1: Wastewater Assets Quantity by Type... 7 Table 2: Activity Linkages to City Goals Table 3: Wastewater Activity contribution to City Goals Table 4: AMP Linkages to the Infrastructure Strategy Table 5: Matters Raised at Councilor LoS Workshop Table 6: LoS Actions from Strategy Plans Table 7: Customer Level of Service, Performance Measures & Targets Table 8: Future Changes to LoS Table 9: Population Projection for Palmerston North Table 10: Household Projection for Palmerston North Table 11: Residential Development Type Table 12: The staging and timing of residential greenfield areas... 36

10 Table 13: Totara Road WWTP Project Flows & Loads Table 14: Replacement Value of Wastewater Assets Table 15: Collection System Assets Table 16: Wastewater Pump Station Condition & Performance Ratings Table 17: Wastewater Treatment Plant Asset Data Table 18: Activity Management Program Five Year Forecast Table 19: Operating Programmes Forecast Expenditure Table 20: IPS Data Accuracy & Completeness Table 21: Operations & Maintenance Forecast Expenditure (Next Five Years) Table 22: Operations & Maintenance Activity Delivery Expenditure Five Year Forecast Table 23: Current Operation and Maintenance SLA Costs (2017/18) Table 24: Life Expectancy of Wastewater Assets Table 25: Renewals Programme Expenditure Five Year Forecast Table 26: Development Programme Expenditure Table 27: Operational Risks Table 28: Resilience Definitions Table 29: Population Based Criticality Grading Table 30: Criticality Grading for Wastewater Pipe Assets Table 31: Criticality Grading for Wastewater Pump Station Assets Table 32: Key Operational Risks & Mitigation Measures Table 33: Key Asset Failure Risks & Mitigation Measures Table 34: Key Project & Planning Risks & Mitigation Measures Table 35: Seismic Resilience Table 36: Utility Services that the Wastewater Activity Depends on for Continuity of Service Table 37: Risk Management Programme Table 38: Relevant Eco City Strategy Priorities and Plans Table 39: Asset Valuations Table 40: Confidence Grading System Table 41: Confidence Rating Wastewater Assets Table 42: Palmerston North City Council 3 Year Asset Management Improvement Programme

11 Executive Summary EXECUTIVE SUMMARY Purpose of this Plan The purpose of this plan is to demonstrate how the assets are being managed so as to deliver wastewater services to the community in a sustainable and cost effective way. This plan details information about: The strategic outcomes that Council is seeking to achieve related to wastewater infrastructure. The level of service to be provided. The infrastructure that need to be maintained, renewed and developed to meet the demands placed on it over the next 30 years. How these services are to be provided. What funding is required to meet these demands. The associated risks. The AMP covers a period from 1 July 2018 to 30 June 2048 with a particular focus on work programmes over the next five years. It informs the Council s 2018/28 10 Year Plan and 30 Year Infrastructure Strategy and contributes to meeting Council s identified strategic outcomes. Activity & Assets The services that are provided to the community through the assets in this plan are as follows: Wastewater collection provided throughout the urban environment including collection of wastewater from the outlying areas of Aokautere, Linton, Bunnythorpe, Ashhurst, and Longburn. Gravity and pumped delivery of the wastewater to the Totara Road wastewater treatment plant. Treatment at the Totara Road Treatment Plant prior to discharge of the treated effluent to the Manawatu River. The assets that contribute to providing these services are: Table A: Asset Component Summary Asset Component Pipelines Quantity 404 km Manholes 5,565 Laterals 27,783 Pump Stations 34 Treatment Plants 1 Oxidations Ponds 2 Valves 35 These assets have a replacement value of $291M. Asset Condition and Performance Wastewater Collection Network The overall condition of the collection network is considered to be good, although there is significant stormwater inflow and infiltration in older parts of the network contributing to high peak wet weather flows. There are also a number of pipe blockages occurring in service laterals and some smaller diameter sewers due to the impact of root intrusion. The overall performance of the wastewater collection network is considered to be good based on the small number of overflows and pipe blockages that occur. Wastewater Pump Stations The majority of the pump station assets are in good to excellent condition. The larger pump stations have been upgraded to meet higher seismic performance levels. Some smaller pump stations are fitted with obsolete electrical and control equipment and are in need to upgrading, which is scheduled early in the next 10 year period. Totara Wastewater Treatment Plant The Totara Road plant has been maintained to a high standard with an ongoing maintenance program and timely replacement of mechanical i

12 Executive Summary and electrical equipment as necessary. Major upgrades to inlet screens, grit traps and pumping are either in progress or programmed to occur early in the next 10 year period. The wastewater discharge consent requires a new consent to be applied for by June A Best Practicable Options study is currently underway to determine the most appropriate form of future treatment and disposal of wastewater for the City. Strategic Environment Asset management planning is undertaken within both an internal and external strategic environment. The internal strategic environment is set by the Council s desired outcomes underpinned by its Vision of Small city benefits, big city ambition. Council has developed a range of Strategy Plans for each of its 5 strategic goals: Goal 1: An innovative and growing city. Goal 2: A creative and exciting city. Goal 3: A connected and safe community. Goal 4: An eco-city. Goal 5: A driven and enabling council. Of particular importance to this AMP are the Infrastructure plan and the Three Waters plan developed under the City Development Strategy and the Eco-City Strategy respectively. The Infrastructure Plan sets expectations that infrastructure for wastewater will be provided ahead of development demand and will be sufficient to meet on-going urban intensification and high rate growth targets. The Three Waters Plan focusses on managing the effects of growth and climate change on wastewater discharge volumes as well as meeting the higher consenting standards likely to be required through the consent renewal project. The external strategic environment is also of relevance in that the performance of the wastewater network is governed by legislative obligations and dependent on the management of receiving water courses which fall under the control of the Horizons Regional Council. The Building Act and Horizons One Plan set legislative and regulatory requirements and controls around development and the level of service from wastewater systems. Critical to the activity in the next 10 year period will be securing a new consent for the wastewater treatment plant. This will require a robust and comprehensive assessment of options and engagement with stakeholders prior to Council s selection of the preferred option. AMP Response to the Strategic Context The approach taken in the AMP is to ensure the safe and reliable collection, treatment and disposal of wastewater to protect community health. Specific issues focussed on for the period and addressed in the plan are: Reductions in stormwater infiltration and inflow to the wastewater network to provide better control of peak wet weather wastewater flows Completion of the Best Practicable Options assessment to determine the preferred option for consenting of a new wastewater treatment and disposal solution to secure wastewater services for the city for the next 30 years Manage flows and loads proactively through implementation of pressure sewer areas and active engagement with major trade waste consent holders Staged expansion of the wastewater network to meet projected growth The benefits of addressing these problems and the consequences of not addressing them are outlined in the AMP. Levels of Service This plan supports Council providing: Wastewater collection and treatment systems which protect public health and provide residential, industrial and commercial properties in the City with safe and reliable disposal and treatment of wastewater. Wastewater infrastructure which meets the expected growth requirements. ii

13 Executive Summary Wastewater services which comply with regulatory and consenting requirements. Selection of a preferred option for the treatment and disposal of wastewater ready ahead of the preparation and lodging of consents by June 2022 Management of the wastewater activity in a financially sustainable way LoS measures for the above services are contained in Council s 10 Year Plan and include a number of regulatory and DIA mandatory performance measures. Key performance indicators include environmental compliance for treatment performance and ensuring wastewater is contained in the network. The AMP also sets out both customer and technical levels of service in the areas of network performance, wastewater overflows, odour events, as well as responsiveness, consent compliance, fault and complaint occurrence and planning. Levels of service are expected to change in the following areas: Higher treatment standards as part of new consenting requirements expected to be in place sometime after June Higher levels of network and treatment reliability associated with greater proactive investment in inspection, condition assessment and maintenance. Specific requirements for the use of low pressure sewer systems in selected new growth areas to limit flows and exclude stormwater Improvements in per capita wastewater generation associated with a greater focus on water efficiency, inflow and infiltration reduction and trade waste improvement plans. Higher trade waste standards as part of measures to ensure new consenting and compliance requirements are achieved. Future Demand The future demand for wastewater in Palmerston North will be driven by: Residential and industrial growth in the city. Greater uptake of Low Pressure Sewer and/or Vacuum Sewer Systems. Changes in Council policy with regard to rural residential properties. Changes in water consumption and usage patterns given that most water supplied for domestic, commercial, and industrial purposes is subsequently discharged into the wastewater system. The extent of stormwater entry to the wastewater system (infiltration and inflow). Climate change. The investment in new wastewater reticulation and treatment capacity outlined in this AMP is based on following a specific Palmerston North high population growth scenario for years 1-10 that equates to 1.0% per annum growth and then a medium growth scenario for years that gives an overall population growth of 0.6% p.a. over 30 years. The main areas for residential growth are Whakarongo in the short term and City West in the longer term supported by other smaller developments. Industrial growth will be serviced mainly by the North East Industrial zone extension and land at Longburn. The demand for services is to be met through a combination of managing existing assets, upgrading of existing assets, providing new assets and demand management. Lifecycle Management Policy and Planning Expenditure on policy and planning is predicted to continue at significant levels with key priorities during the period including: Completing the city wide wastewater network model to provide an essential planning tool to assess capacity constraints; Completing policy and regulatory work to sup[port the implementation of pressure sewer areas within the city to better manage flows; iii

14 Executive Summary Undertaking critical asset condition assessment including enhanced condition assessment for critical mechanical and electrical assets; and Targeting stormwater infiltration and inflow to the wastewater network by way of a dedicated programme of work and proactive follow-up on fault identification. The programme also includes provision for an enhanced annual programme of CCTV inspection and condition grading for a significant portion of the network with a focus on the catchments with high wet weather flows. Operations and Maintenance Plan The operations and maintenance strategy is intended to deliver the required levels of service, mitigate risk and minimise costs by implementing a balanced programme of planned, preventative and reactive works. Operation and maintenance costs are expected to increase over the planning period due to increased costs associated with meeting higher wastewater treatment and disposal consent requirements. Some minor reductions in costs are anticipated due to increased reliability of equipment. Renewal of Assets Renewal or restoration of assets is required to ensure that the service potential of the asset is maintained and that the level of service can continue to be delivered. The renewal programme seeks to provide the optimum mix of treatment options and timing for minimising costs over the life of the asset. The renewal programme is based on: Knowledge of historical renewal requirements. Collected asset condition and age data, using a predictive deterioration relationship based on consideration of asset lives and historical rates of condition deterioration. Actual asset condition assessment programme undertaken on key assets to determine remaining life cycles and prioritisation programme for replacements and maintenance. Failure history and in some cases, predictive modelling. Treatment selection and work prioritisation are determined from an economic analysis of options considering all asset life cycle costs. Total renewal expenditure of $65.M is forecast for the next 30 years for the treatment plant and sewer network as shown in Figure B. The difference between depreciation and forecast renewal expenditure is due to the relatively young age of some of the wastewater pipe network and the impact of the expected upgrade of the wastewater treatment plant which is expected to result in some assets being superseded. Development of Assets Asset development needs to meet demand forecasts and deliver the agreed level of service are identified from an assessment of risks, performance monitoring and demand analysis. All feasible options, including nonasset demand management options, are considered. Project selection and prioritisation is determined from an economic analysis of options considering all asset life cycle costs. Capital development projects undertaken to meet level of service needs and growth are funded from borrowing and developer contributions respectively. Expenditure of $128.0M is forecast for the next 30 years for treatment plant development and sewer network upgrades required to accommodate growth with the dominant investment of $110.0M associated with the WWTP Consent Renewal. The capital expenditure associated with the consent renewal will be the single largest expenditure by Council in the planning period. Financial Summary The following graphs show the projected operating and capital expenditure associated with the management and development of the assets as set out in the O&M, Renewals and Development Plans. Annual expenditure is iv

15 Executive Summary shown annually for the first 10 years and then 5 yearly bands for years of the plan. Forecasts are shown as present day costs. Operation and Maintenance Figure A depicts projected operation and maintenance expenditure for the 30 year period excluding interest and depreciation. Figure A: Thirty Year Projected Operations and Maintenance Figure C: 30 Year Projected New Capital Expenditure Millions $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 Capital New Expenditure Wastewater Average Annual in 5 year bands I I I I I I Millions $10 $8 $6 $4 $2 $0 Operational Expenditure Wastewater Average Annual in 5 year bands I I I I I I I I I Financial forecasts are based on generally good asset information although extrapolation of information has been used in some places. Projects in the first few years are more fully scoped than in later years. Risk & Resilience Renewals Figure B depicts projected renewal expenditure for the 30 year plan period. Figure B: 30 Year Projected Renewals Expenditure Millions $4 $3 $2 $1 $0 Capital Development Renewal Expenditure Wastewater Average Annual in 5 year bands I I I I I I The projected 30 year capital development expenditure profile is depicted in Figure C. Critical assets are those assets which have the highest consequences in terms of disruption in service and financial, environmental and social cost should they fail. For the Wastewater Activity, the assets in this category are: Large diameter wastewater pipes (criticality assessed as High); Massey and Maxwell s Line wastewater pump stations (criticality assessed High); and Totara wastewater treatment plant. Assets with critical customers Key risks identified for the activity as a whole are: Odours from the system; Power failure; Network blockage or breaks; Pump station failure; Wastewater treatment plant failure; Network capacity failure due to lack of planning; and Major earthquake hazard. Mitigation measures to address these risks are covered in this plan. Resilient infrastructure is able to deal with significant disruption and changing circumstances as a result of the occurrence of v

16 Executive Summary natural hazards, such as seismic and volcanic events. This AMP is focussed on continuity of wastewater services following a high consequence event. The greatest threat to the functionality of the wastewater activity is a major seismic event, with the resilience of critical assets especially important for continuation of service delivery. These include the wastewater treatment plant, major pump stations and trunk mains. Both technical and organisational aspects of resilience have been considered in this plan. Data Management and Reliability The quality and completeness of the wastewater asset data is considered average given it is based on historical capture of asset data at the time of construction and some periodic condition information captured using CCTV. Significant additional CCTV inspection is proposed particularly of the critical large diameter network where there have been a number of unexpected failures. Additional targeted work to try to better manage stormwater inflow and infiltration to the wastewater network is also planned. Other improvements include: Installation of permanent flow meters with auto-data capture to better monitor flows in the network Upgrades to wastewater pump stations to provide real time flow measurement to identify leaky catchments with high inflow and infiltration Implementation of real time flow measurement of all significant trade waste discharge consent holder to better manage their impact on the network Detailed condition assessment of all major items of plant and equipment at the WWTP to develop an optimised renewal programme Continuous Improvement Asset management processes and practices are continually being assessed and improved in order to provide more cost effective asset management. The priority improvement tasks for the next 3 years are as follows: Capital renewal and development project planning further development of processes to take into account a sustainable development approach Review demand projections on an on-going basis consistent with Council s Residential Growth Strategy Continue to develop the wastewater network model and risk based approaches to help prioritise renewal programmes and better manage risks and costs in achieving the desired outcomes Asset information on-going development of asset systems and collection and analysis of data to meet all asset management needs. Resource planning is undertaken to ensure the recruitment, retention and development of sufficient and suitably qualified staff. Conclusion This AMP sets out programmes for operating, maintaining, renewal and development of the Wastewater Activity over the next 30 years that will ensure the required level of service is delivered to the community, the service potential of the asset is maintained for future generations, and growth of the City is provided for. vi

17 Section 1 Overview 1 Overview 1.1 Purpose of this Plan This AMP is the basis for the Wastewater activity planning. The objective of asset management is to; Deliver the required level of service to existing and future customers in the most cost-effective way. In this context the specific objectives for the AMP are: To define the services to be provided, the target service standards that Council aims to achieve, and the measures used to monitor the performance of the Wastewater activity. To translate Council s Strategic Vision and Goals into activity strategies and action plans that aligns to National and Regional policies and strategies. The plan identifies forward works programmes based on strategic outcomes sought and financial forecasts required to meet agreed service levels and cater for growth. To demonstrate responsible management of the Wastewater activity infrastructure to stakeholders, ensuring that public funds are optimally applied to deliver cost effective services to meet customer expectations. To document current asset management practices used by PNCC based on clear evidence as part of a sustainable and optimised lifecycle management strategy for the Wastewater infrastructure, and identify actions planned to enhance management performance. To comply with the requirements of relevant legislation. The key outputs of this AMP are input into the Year Plan process, which will be the subject of a special public consultative procedure. The intention of this AMP is to set out how Council manages Wastewater assets and services in a way that is appropriate for a readership including elected members of the Council, executive management, interest groups, and business partners associated with the management of the Wastewater activity, along with interested members of the community. It covers the services that are provided from ownership and management of the associated assets. This AMP covers a period of 30 years commencing 1 July Operational, maintenance, and renewal programmes for the first 3 years are generally well defined, with reasonable certainty of being implemented to budget as planned. Beyond this period, work programmes are generally based on projected trends and demands, and there is less certainty with respect to scope and timing of the projects. All expenditure forecasts are based on unit costs as at 1 July Relationship with Other Plans AMPs are a key component of the Council planning process, linking with the following plans and documents: 10 Year Plan (10 Year Plan): A plan required by the Local Government Act (2002) to cover a period of at least 10 years and provide a long-term focus for the decisions and activities of the Council. This AMP contains key information about the Council s activities, assets, levels of service and cost of providing services. This AMP provides key inputs to the Year Plan. 1

18 Section 1 Overview Infrastructure Strategy: A local authority must, as part of its long-term plan, prepare and adopt an infrastructure strategy for a period of at least 30 consecutive financial years. The purpose of this strategy is to: identify significant infrastructure issues for the local authority over the period covered by the strategy; and identify the principal options for managing those issues and the implications of those options. Annual Budget: Provides the programmes and funding plan for each year of the 10 Year Plan, including reporting on variances. District Plan: The District Plan gives effect to four land-use strategies through the City Planning Framework that covers residential, industrial, commercial and rural residential development. The strategies establish the best use of land and direct where private sector investment should occur based on several land use zones. AMPs give support to the strategies and link into the 10 Year Plan for funding of infrastructure. Contracts and Service Level Agreements: The service levels, strategies and information requirements contained in AMPs are translated into contract specifications, internal service level agreements, and reporting requirements. Bylaws, standards, and policies: These tools for asset creation and subsequent management are needed to support AM tactics. Wastewater Services Assessment: This assessment, as required by Section 125 of the Local Government Act 2002, is for territorial authorities to assess the extent to which wastewater (and other water and sanitary services) collection and disposal within the district is being undertaken to adequate standards that meet the current and future community s needs. This includes areas not currently serviced by Council infrastructure. The Horizons Regional Council One Plan: A major focus of this plan is the quality of treated wastewater needed to ensure that the water quality of the Manawatū River is improved particularly with regard to the discharge of nutrients during low flow periods in the river. Figure 1 depicts the relationship between the various processes and levels of planning within the Council required to deliver on Council s vision and goals. COUNCIL VISION & GOALS Community & Stakeholder Consultation STRATEGIC PLANNING e.g. Council s strategic direction & 10 Year Plan Long term programmes (5-30yrs) TACTICAL PLANNING e.g. Asset Management Plans Medium term programmes (2-5yrs) OPERATIONAL PLANNING e.g. Annual Budget Annual Budget Programme Monitoring & Review Figure 1: Relationship between Council Planning Processes 2

19 Section 1 Overview 1.3 AMP review process This AMP review has been a 12 month project undertaken by Council s asset management (AM) team, led by the Special Projects Manager, covering all Palmerston North City Council (PNCC/Council) AMPs. Linkages were established early in the process with other Council planning teams including the Year Plan team, strategic planning and corporate finance teams to ensure an integrated approach to consistency of information and assumptions across the organisation. The stages of the review have been as follows: Assessment of Council s strategic direction as it has developed over the period February August 2017 to determine the asset implications of delivering the community outcomes that the Council is seeking and developing programmes accordingly. Level of service review to determine what level of service the Council considered affordable and what changes are required. The Councillors were informed about current levels of service and workshopped the issues and options giving consideration to any changes in current levels of service (23 March 2017). Strategic environment assessment of growth and demand projections to determine future capacity requirements Review of critical assets and key risks, assessment of critical asset resilience to natural hazards and interdependencies, review of risk management strategies, and updating of risk management programmes. Preparation and review of AMP budget forecasts to inform the 10 Year Plan (July - Nov 2017). Internal Peer Review and finalisation of AMPs (December 17 Jan 18). External peer review (February 2018). Formal reporting of AMPs to the Council. Any variations between the respective AMPs and the Year Plan will be the subject of a report to Council following adoption of the 10 Year Plan in June This AMP has been prepared as a team effort by officers dedicated to and trained in AM planning. This team has been supervised and the AMP internally reviewed by professional Council staff having over 10 years experience in preparing AMPs. An external peer review has been undertaken by AECOM Ltd. 1.4 Changes to AM since 2014 Asset management is a process of continuous improvement, contiguous with development of and changes to Council s strategic environment and improved knowledge of asset condition and performance to achieve agreed levels of service. Key changes to the AMP since 2014 are as follows: Development of capital new and operational programmes to align with Council s new Vision Small city benefits, Big city ambitions and associated goals and strategies and the outcomes that the Council is seeking to achieve. (Section 3) Adjustments to the levels of service to be delivered to the community through level of service review and development of Council s strategy plans. (Section 4) 3

20 Section 1 Overview Revised schedule of development works for growth for both residential and industrial growth arising out of higher population growth projections - a high growth scenario for years 1-10 and a medium growth scenario for years This requires infrastructure for a greater number of households over 30 years than previously planned. (Section 5) Reassessment of demand for services as a result of higher population and household projections. (Section 5) Updating of the risk and resilience section. (Section 7) Improvements to asset management processes, particularly the introduction of the Programme Planning and Implementation process. This is to ensure that the programmes in this plan are supported by robust information. 1.5 Navigating the AMP This AMP comprises a series of logical steps that sequentially and collectively build the framework for sustainable asset management for the activity it serves. The plan contains three main sections. It first describes what the plan is about and the activity it relates to. The second section is about the drivers that influence and set the direction for asset management. The third section describes out the level of service and strategic outcomes are achieved through managing and developing the assets. 4

21 Section 1 Overview AMP at a Glance (Executive Summary) Overview (Section 1.0) Purpose of AMP, relationship to other planning documents, AMP review processes & navigation The Activity (Section 2.0) Purpose, description & rational of activity, Custemers/Users, Key relationships for management of activity, significant changes and negative effects associated with activity. What the Plan is about Setting the scene The Strategic Environment (Section 3.0) Strategic context (internal & external) to determine key outcomes sought. Strategic assessment to identify problems and benefitrs within the overall strategic context & the outcomes desired. Levels of Service (Section 4.0) The review process followed and the qualities of the service that Council intends to deliver to the Community Growth & Demand (Section 5.0) The growth and demand factors impacting on the capacity and levels of service provided by the assets over 30 years Requirements Setting Strategic Direction Assets & Lifecycle Management (Section 6.0) Plans detailing how the assets are to be managed, operated, maintained, renewed and developed to provide the required level of service over the asset life. Risk and Resilience (Section 7.0) Risks identified that may affect the ongoing delivery of services from Council s infrastructure and resilience to natural disaster Sustainability (Section 8.0) Identification of key sustainability issues and linkage to Council s strategies Financial Projections (Section 9.0) Outlines the long-term (30yr) financial projections for operating, maintaining, renewing and developing the assets. Asset valuation and reliability of estimates. Asset Management and Strategic Response Assumptions (Section 10.0) Key assumptions used in developing asset lifecycle programmes and impact of variations from these assumptions Improvement Plan (Section 11.0) Initiatives to make improvements to asset management planning over the next 3 years and to inform the next AMP review Figure 2: AMP Structure 5

22 Section 1 Overview 6

23 Section 2 The Activity 2 The Activity This section sets out the services provided by the Wastewater Activity including: A description of the asset used to deliver the activity; The rationale for Council involvement and ownership of assets; The significant negative effects of the activity; and The significant changes in the activity since the last AMP. 2.1 Activity Description The key function of the Wastewater Activity is to provide for the safe and reliable collection, treatment, and disposal of wastewater (sewage) from residential, industrial, and commercial properties. There are six separate public wastewater collection systems servicing different areas of Palmerston North City. All wastewater collected within the city boundary is treated at the Totara Road Wastewater Plant in Palmerston North and discharged to the Manawatū River. The broad asset groups and their values as of June are shown in Table 1. Table 1: Wastewater Assets Quantity by Type Asset Component Quantity Replacement Value Pipelines 418km 138,594,111 Manholes 5679 $30,312,864 Laterals 27,783 $68,948,126 Pump Stations 36 $6,037,242 Treatment Plants 1 $44,816,718 Oxidations Ponds 1 $1,368,890 Valves 109 $570,484 Total $290,648,435 The Wastewater activity comprises the collection of wastewater from private properties and residences, conveyance of the wastewater to a central treatment facility, either by gravity or if necessary by pumping, and treatment of the wastewater to remove harmful pollutants and pathogens before discharge to a receiving environment. A schematic layout of a typical wastewater system is shown in Figure 3 below. 1 Revaluation of Infrastructure Assets June

24 Section 2 The Activity Sewage pipeline Sewage treatment plant Private service connection Figure 3: Schematic Layout of Wastewater System The discharge of industrial effluents into the public wastewater system is regulated by the Trade Waste Bylaw The wastewater system is regulated by the Local Government Act 2002, Health Act 1956, and the Wastewater Bylaw City Networks also provides advice to developers on the provision of wastewater reticulation to service new developments. Although most of the City is urban in nature, there are adjoining rural areas where it is not usually practical to provide a reticulated wastewater service because of the inability to spread the cost of the infrastructure required (pipes, pumps etc.) across a sufficient number of properties. Reticulated wastewater systems may be provided when the land use in these areas changes and they are developed for urban housing. The point of service for wastewater collection is generally the property boundary. The Council owns and maintains all wastewater pipelines up to and including the point of service. All wastewater drains and plumbing upstream of the point of service are owned by, and are the responsibility of, the property owner. 8

25 Section 2 The Activity Figure 4: Map of Wastewater Collection Areas 9

26 Section 2 The Activity Palmerston North Main Urban Area The Palmerston North wastewater system services a population of approximately 73,662. This includes Ashhurst, Aokautere, Linton (including the Army Camp & Prison), Bunnythorpe, and Longburn. It comprises approximately 418 km of pipelines which operate mainly by gravity drainage to convey wastewater to the Totara Road wastewater treatment plant. There are 36 pumping stations in this system, which pump wastewater to higher elevations from where gravity drainage is not practical. Tertiary treated effluent is discharged to the Manawatū River in accordance with a Resource Consent issued by Horizons Regional Council Ashhurst The Ashhurst wastewater system services a population of approximately 2,634. It comprises approximately 17 km of pipelines, which convey wastewater to the Ashhurst Oxidation Ponds. There are two pump stations in the Ashhurst system: one in Durham Street, and the other located next to the existing oxidation ponds. Wastewater from Ashhurst is partially treated in the existing oxidation ponds before it is pumped to Palmerston North by way of 9 km of 250 mm diameter rising main, where it discharges into the City s main gravity system at Rosalie Terrace Aokautere This system services a population of approximately 70 people. 600 metres of gravity pipelines convey wastewater to a pumping station in Peterson Road where it is pumped back up Aokautere Drive through 1360 m of 100 mm diameter rising main to where it discharges into the City s main gravity system at Cashmere Drive Linton (Excluding Army Camp & Prison) This system services 45 individual residential properties which are connected to the Linton Army camp, which is a privately managed system. Wastewater is conveyed to an oxidation pond owned and operated by the Ministry of Defence where it is partially treated before the effluent is pumped across the Manawatū River via a pipeline owned by the NZDF to the Totara Road Waste Water Treatment Plant (WWTP). Wastewater from Linton also includes the discharge from the Linton Army Camp and its associated residential housing area, Manawatū Prison, and New Zealand Pharmaceuticals Bunnythorpe A separate reticulation system services the township of Bunnythorpe, which has a population of approximately 451. Wastewater from Bunnythorpe is now pumped to Palmerston North City for treatment. The Bunnythorpe wastewater system comprises of approximately 8.57 km of pipelines. There are 3 pump stations located within Bunnythorpe, with wastewater pumped to Palmerston North from the Kairanga-Bunnythorpe Road pump station Longburn A separate reticulation system services the township of Longburn, which has a population of approximately 400 (including Longburn College Boarders). The Longburn wastewater system comprises of approximately 9.4 km of pipelines (including rising mains). Wastewater from Longburn is pumped to Palmerston North through 2 pump stations located in Reserve Road and Walkers Road via the 300 mm diameter rising main servicing the Works Road Industrial area. 10

27 Section 2 The Activity 2.2 Activity Rationale Adequate systems for the disposal of wastewater are a fundamental requirement for the health and general wellbeing of the community. In urban areas wastewater is most effectively disposed of by means of reticulated wastewater systems that allow the costs associated with maintaining high standards and efficient infrastructure to be spread over a wide population base, thereby keeping the costs to individual users for wastewater disposal within affordable levels. Sanitary facilities installed to good standards and connected to reticulated wastewater systems require minimal maintenance or intervention for their satisfactory on-going operation and represent a convenient and low risk means of wastewater disposal. The importance to community wellbeing of effective public wastewater systems is recognised in the Health Act 1956, which requires Local Authorities to provide sanitary works, the definition of which includes wastewater works and includes all lands, buildings, pipes, and appliances used in connection with any such works, and provide any dwelling house with suitable appliances for the disposal of wastewater and sufficient sanitary conveniences. The goals for the Wastewater Activity are as follows: To ensure that all community sanitary wastes are satisfactorily collected, treated, and disposed of in order to protect the health and safety of the public, and to protect and enhance the quality of the natural environment. To encourage the use of advanced technologies for providing higher quality, reliable, and cost effective treatment, disposal, and reuse options. The existing wastewater system has been developed and built up over many years as a public system to serve the needs of the community in the collection, treatment and disposal of wastewater. The Local Government Act 2002 requires local government organisations which provide water services (which include wastewater services) to continue to provide these services and maintain their capability to do so. Recent amendments to the Local Government Act have further clarified the purpose of local government, in particular: To meet the current and future needs of communities for good-quality local infrastructure, local public services and performance of regulatory functions in a way that is most cost-effective for households and businesses. The services provided by the water activity contribute to the goals adopted by Council for the City as summarised in Table 2. Table 2: Activity Linkages to City Goals Priority Goal 1 An innovative and growing city Goal 2 A creative and exciting city Goal 3 A connected and safe community Activity Contribution To ensure that wastewater infrastructure is in place to collect and treat wastewater in advance of new commercial, industrial and residential development. Provide reticulated wastewater services which limit negative impacts on public recreational facilities. Effectively manage and mitigate wastewater overflows and provide early and appropriate advice to the community and residents to minimise health impacts. Ensure the wastewater network functions reliably and is able to contain, transport and treat wastewater with the minimum of risk to community health. Identify and effectively mitigate all dry weather wastewater overflows and limit wet weather overflows. 11

28 Section 2 The Activity Priority Goal 4 An eco city Goal 5 A driven and enabling council Activity Contribution Reduce the environmental impact of wastewater on the Manawatu river by ensuring current treatment processes comply with resource consents and confirming the preferred option for wastewater treatment and disposal in time for preparation and lodgement of consents by June Target reductions in carbon emissions by more efficient treatment processes, energy efficient equipment and implementing food waste and organic waste to energy initiatives. Adoption of digital transformation technology where appropriate to enable more efficient operation and provide better customer service. The goal areas most relevant to the Wastewater activity are Goals 1 and 3. These are expanded on in Section 3, The Strategic Environment. Customers of wastewater services are broken down as follows: Residential customers Industrial customers Commercial customers 2.3 Key Relationships PNCC has overall responsibility for public wastewater services in the City. This includes setting policy, service standards, ensuring the required outcomes are achieved as efficiently as possible within Council s strategic direction, and quality assurance. In providing the wastewater service City Networks works with a number of key business partners including contractors, consulting engineers, regulators, and specialist service providers: City Enterprises, a unit of the Council, is engaged by City Networks to provide treatment plant operation and reticulation operation, maintenance, and renewals services. The Ministry of Health has statutory responsibility for public health issues in New Zealand including health related aspects of wastewater services. Horizons Regional Council (the operating name of the Manawatū-Wanganui Regional Council) has an environmental, regulatory, and monitoring role under the Resource Management Act that includes the regulation of discharge of wastewater to land or receiving waters. Council currently holds consents for each wastewater treatment facility. Water related issues are of special cultural significance to Maōri. Local iwi are formally represented by Rangitāne. Palmerston North City Council is committed to fostering the relationship with Rangitāne, and developing an active partnership into the future. Palmerston North adjoins areas administered by Manawatū District, Horowhenua District, and Tararua District Councils. City Networks maintains relationships with wastewater staff of the other Councils through various professional organisations to facilitate the exchange of information, management practices, and to facilitate a joint approach to wastewater issues where this is beneficial. Other stakeholders in the wastewater activity are: The Palmerston North community, including citizens, ratepayers, and individual users of the services. Trade waste users. Rangitāne o Manawatū. Community groups. Visitors to Palmerston North. 12

29 Section 2 The Activity 2.4 LGA Section 17A Review Under section 17A of the Local Government Act Local Authorities are required to review the cost effectiveness of their arrangements for meeting the needs of their communities for good quality local infrastructure, public services and regulatory functions. This review requirement includes considering options for the governance, funding and delivery of infrastructure and services. In June 2016 the Council decided to make the water service exempt from an s17a review prior to 7 August It decided that a review of this activity before this time was not an effective use of Council resources. 2.5 Significant Negative Effects of the Activity Potential negative effects associated with the wastewater activity include: Discharge of treated wastewater effluent from the WWTP to the Manawatū River adversely affecting river quality. Overflows of untreated wastewater from the wastewater system to the Manawatū River adversely affecting river quality. These may result from: Overloading of the wastewater system during rainfall due to the entry of stormwater runoff (infiltration and inflow); Structural failure of pipelines; Blockages of wastewater pipelines; or Malfunction of utility installations such as pumping stations or treatment plants. Odours from wastewater infrastructure such as pumping stations, treatment facilities, and pipeline vents adversely affecting local residents. The disposal of wastewater treatment by-products, such as bio-solids (stabilised solids extracted from the wastewater during the treatment process), adversely affecting the receiving environment. All of these potential negative effects are managed as part of the day-to-day operation of the Wastewater Activity. The quality of effluent discharged to the Manawatū River is regulated by the conditions in the resource consents for these discharges issued by Horizons Regional Council. The consent conditions ensure that negative effects associated with the discharge are managed to acceptable levels. The Horizons Regional Council initiated a formal review of the discharge consent, with focus on the life supporting capacity of the river. This review was heard in front of four commissioners in 2014 and 2015, following submissions from both PNCC and Horizons Regional Council. The Consent Review Hearing was concluded without a decision. PNCC instead offered to apply for a new discharge Consent in 2022, some 6 years before the original date. In addition, a series of actions were agreed including Undertake further investigations into the effects of the discharge on the Manawatū river Undertake a robust Best Practical Options review of treatment options prior to the application of a new consent. The entry of stormwater to the wastewater system during heavy rainfall can cause overloading of sections of the wastewater system and may lead to overflows. This situation is not confined to Palmerston North, with similar problems being experienced to varying degrees in most urban wastewater systems in New Zealand. 13

30 Section 2 The Activity The range of strategies adopted to overcome wet weather overloading of the wastewater system includes: Programmes to reduce the entry of stormwater to the wastewater system in private properties (infiltration/inflow programmes). Renewal of pipelines where there is excessive entry of stormwater and or groundwater through defects in the pipes. Providing additional capacity in parts of the wastewater system. There are no reported odour issues associated with the wastewater reticulation system however a small number of odour complaints are received regarding the operation of the WWTP on Totara Rd. Some of the complaints relate to composting activities at the Council composting operations, however in general the odour suppression system in place and careful management of the disposal of wastewater treatment by-products is effective. 2.6 Significant Changes to the Activity Significant changes to the Wastewater Activity are anticipated to meet increased regulatory requirements from the Horizons Regional Council resource consent discharge conditions. Both to address concerns around overflows from the Bunnythorpe treatment pond to the Mangaone Stream and to avoid incurring disposal charges from MDC, all Bunnythorpe wastewater flows are now pumped to the Palmerston North network as July As outlined the most significant capital works investment will be associated with the upgrade of treatment and/or disposal to meet the requirement of a new consent when the current consent expires in A provision of some $110M has been made, however the exact level of funding will be determined by the preferred option to be selected by Council at the conclusion of the Best Practicable Options assessment currently underway. 14

31 Section 3 Strategic Environment 3 Strategic Environment This section sets out the strategic environment within which the wastewater activity is managed under the following areas of: Internal Strategic Context Statutory and Regulatory Requirements AM Policy and Strategy 3.1 Internal Strategic Context Council Vision, Goals & Strategic Direction The Council Vision for Palmerston North is: Small city benefits, Big city ambition. Supported by 5 strategic goals: Goal 1: An innovative and growing city. Goal 2: A creative and exciting city. Goal 3: A connected and safe community. Goal 4: An eco-city. Goal 5: A driven and enabling council. To achieve the vision and goals, the Council has developed a number of strategies each with specific priorities and associated strategy plans (including actions that link to specific programmes). The Plans most relevant to this AMP are highlighted in Table 3. Table 3: Wastewater Activity contribution to City Goals City Goals City Strategies Priorities Strategy Plans An innovative and growing city Economic Development Strategy Create and enable opportunities for employment and growth Provide the right infrastructure at the right time to enable growth Support an innovative economy to underpin growth into the future Economic Development International Relations Carbon Emissions reduction Transform the economy to a low carbon economy City Development Strategy Create and enable opportunities for employment and growth Provide the right infrastructure at the right time to enable growth District plan Housing and future development Strategic partnerships Urban design Built heritage Infrastructure Strategic Transport Parking 15

32 Section 3 Strategic Environment City Goals City Strategies Priorities Strategy Plans An eco-city Eco City Strategy Respect and enhance the mauri of the Manawatū River Work with the community to reduce carbon emissions Regenerate native biodiversity Invest in infrastructure that serves to protect, enhance and preserve our environment Use our legislative powers and policies to ensure that urban development is sustainable now and into the future Educate the community, in particular, property owners, on the benefits of investing in sustainable building design and green buildings Demonstrate leadership and best practice by developing and implementing an environmental sustainability plan for the Council Biodiversity Three Waters Waste Energy Sustainable practices plan The Council s strategic and corporate goals represent the outcomes Council aims to achieve for the City consistent with its vision and in order to promote community well-being, both now and in the future. Underpinning the city s vision, goals, strategies, and plans are the following strategic themes that guide the way in which the outcomes and actions are delivered: Smart city practices use smart systems, processes and tools. Sustainable practices embed sustainable design and behaviours. Iwi partnerships work collaboratively with iwi partners. Strategic Partnerships work collaboratively with key strategic partners Infrastructure Strategy The Local Government Act 2002 Amendment Act 2014 introduced a requirement for Council to prepare and adopt, as part of its 10 Year Plan, an infrastructure strategy covering a 30 year planning period. This AMP is an integral document in informing the Infrastructure Strategy. Table 4 describes the linkages between this AMP and the component parts of the Infrastructure Strategy. Table 4: AMP Linkages to the Infrastructure Strategy Infrastructure Strategy s.101b LGA 2002 Asset Management Plan Paragraph No. Description Reference 2a & b Significant infrastructure issues & options Sections 4.0, 5.0, 6.0 & 9.0 3a Renewals and replacements Sections 6.0 & 9.0 3b Growth or decline Sections 5.0, 6.0 & 9.0 3c Changes to LOS Sections 4.0 and 6.0 3d Maintain or improve public health & environmental outcomes or mitigate adverse effects Sections 3.0, 4.0, 6.0, 7.0, 8.0 & 9.0 3e Resilience of infrastructure relating to natural hazards Sections 6.0, 7.0, 9.0 and a Estimates of capital and operating expenditure Section 9.0 4b Significant decisions about capital expenditure Sections 6.0 and 9.0 4c & d Assumptions & uncertainty Section

33 Section 3 Strategic Environment 3.2 External Strategic Context Horizons Regional Council One Plan This One Plan is about how the natural and physical resources of the region are managed and sets water quality targets for major river catchments, including the Manawatū River. New consents for discharges of treated wastewater will need to meet the objectives, policies and rules of the One Plan. Rangitāne o Manawatū, as mana whenua, are explicitly recognised in the One Plan, as they have identified the reach of the Manawatū River from upstream of the Manawatū Gorge down to the Foxton Loop, including short reaches of the Pohangina at Ashhurst and the Oroua at Rangiotu, as having a high density of cultural and historical sites of significance including wāhi tapu and taonga. These cultural sites would be negatively and potentially permanently harmed by some activities and consequently are given a high level of protection under Policy 6-28 which states: Policy 6-28: Activities in sites with a Value of Sites of Significance Cultural In sites with a Schedule AB Value of Sites of Significance - Cultural activities in, on, under or over the beds of rivers and lakes must be managed in a manner which: (a) (b) avoids adverse effects on these Values in the first instance; or for infrastructure and other resources of regional and national importance, or activities that result in an environmental benefit, remedies or mitigates those effects where it is not practicable to avoid them 3.3 Statutory and Regulatory Requirements Key Legislation The key legislation relating to the management of wastewater supply assets are listed below. The statutory requirements provide Council with a minimum level of service standard and have been reflected in the levels of service shown in Section 4. Council is currently complying with all legislative requirements: Local Government Act 2002 Amendment Act 2014, which defines the purpose of local government as enabling local decision-making and action by and on behalf of communities and to meet the current and future needs of communities for good-quality local public services and performance of regulatory functions in a way that is most cost effective for households and business. Resource Management Act 1991, promotes the sustainable management of natural and physical resources. It also requires Councils to take into account the principles of the Treaty of Waitangi in exercising functions and powers under the Act relating to the use, development and protection of natural and physical resources. National Policy Statement for Freshwater Management 2014, Amended Sets out the objectives and policies for freshwater management under the RMA. It gives specific direction to Local Authorities with respect to Tangata whnua roles and interests. National Environmental Standard for Sources of Human Drinking Water is intended to reduce the risk of contaminating drinking water sources such as rivers and groundwater. 17

34 Section 3 Strategic Environment Health and Safety at Work Act 2016, which requires the provision of safe work places for all activities by the Person conducting a Business or Undertaking (PCBU) has the Primary Duty of Care and needs to take such precautions as is reasonably practicable for the health, safety and welfare of workers and any other people at risk from any work carried out. Key requirements for local authority staff and any contractors in addition to complying with the act is the maintenance of an audit trail to demonstrate compliance with the Act. Building Act 2004, which sets minimum standards for buildings and facilities, and requires Councils to produce Project Information Memoranda (PIM s) and building Warrants of Fitness. Public Works Act 1981, which prescribes processes to enable the acquisition of land for the completion of construction works by Council. Public Bodies Contracts Act 1959, which confers on a local authority similar powers to enter contracts as enjoyed by corporate bodies or natural persons. Construction Contracts Act 2002 sets requirements for payment provisions for construction contracts and dispute resolution. Local Government Official Information and Meetings Act 1987 sets requirements concerning disclosure of information. Civil Defence and Emergency Management Act 2002 provides for a coordinated approach to the planning and preparation for emergencies and for response and recovery in the event of an emergency. Utilities Access Act 2010 requires utility operators and corridor managers to comply with a national code of practice that regulates access to transport corridors and provide for the making and administration of that code. Health and Safety in Employment Act Local Bylaws The following Council By-laws are relevant to the management of Wastewater Activity assets: Palmerston North Trade Waste Bylaw Palmerston North Wastewater Bylaw Palmerston North Stormwater Bylaw Regulations are in effect for controlling the quantity and composition of industrial wastewater flows to protect wastewater assets, wastewater treatment processes, and wastewater workers (Council staff and contractors). The Wastewater Bylaw is new for Palmerston North and was established to regulates and defines domestic wastewater, the point of supply, and covers matters relating to the acceptance of wastewater discharge, the process for applying for a new connection, working around buried services, and pressure sewer systems, as well as defining the wastewater service areas where connections are allowed Standards & Specifications The standards and specifications for all works to wastewater assets reflect the best current technologies, national standards and legislative requirements. All wastewater assets are operated, maintained and built in accordance with: PNCC Engineering Standards for Land Development. PNCC Policy for Road Openings and Reinstatement. New Zealand Building Code and Electrical Regulations. NZS 6101 'Classification of Hazardous Areas'. 18

35 Section 3 Strategic Environment CCTV - New Zealand Pipe Inspection Manual. Appropriate industry best practices, technologies and the most recent version of national standards and legislative requirements. PNCC District Plan. Resource consents issued under the Resource management Act Horizons One Plan. Wastewater Bylaw Asset Management Policy & Strategy Asset Management Policy AM Policy Asset are managed so as to meet the asset management objectives set out below by applying the AM Strategy. Objectives To have a consistent approach across all asset classes within the Council. AMPs reflect the strategic direction of the Council (Including the financial strategy). To manage the assets in a sustainable manner in order to deliver the required level of service to the present and future generations. Assets are managed cost effectively in accordance with sound risk management, environmental management practice and statutory and regulatory requirements. That there is continual improvement of asset management practice in the organization. To have up to date AMPs that reflect a multidisciplinary approach across the organization to inform the 10 Year Plan process. That asset management performance can be demonstrated to the Council and community. That AM Policy and Strategy is approved by Management Team and that AMPs are adopted by the Council to inform the 10 Year Plan Asset Management Strategy AM Strategy This Infrastructure Strategy sets out the approach to organising and practicing infrastructure management so as to achieve the asset management objectives for the different Asset Management inputs as set out below. Planning strategy 30 Year Infrastructure Strategy A 30 year Infrastructure Strategy will be completed as part of the 10 Year Plan process and will reflect the Council s vision and strategy and provide a combined view of the asset programmes that are required to achieve this. It will show a clear linkage between the strategies and the programmes required to achieve the strategies. The Strategy will reflect the decisions made by the Council through the 10Yr Plan process. 19

36 Section 3 Strategic Environment Asset Management Plans AMPs will be reviewed at 3 yearly intervals to align with the 10 Year Plan planning process and cover a 30 year planning period. AMPs will reflect the strategic and financial direction of the Council and be integrated with other Council planning documents. Differences to AMP programmes and those approved in the 10 Year Plan will be reported to the Council together with the asset and service implications. There will be further development of the concept of maintaining the AMP as a living document that more accurately reflects the current policies and decisions of the Council. Levels of Service A review of the Levels of Service (LoS) that is to be provided will be undertaken in conjunction with the AMP review to reflect any changes that Council may wish to make. The review will be informed by community satisfaction and submissions received over the previous 3 years and Council direction. Engagement with the community on options will be undertaken for specific significant projects as they arise in accordance with the Council s Community Engagement Strategy. The review will inform the levels of service adopted by the Council. Capital New Planning Capital works planning will be based on a sound understanding of the need and timing for the asset based on demand forecasts and implementation of Council s strategic and financial direction. Documentation will be provided for justification of each programme. Programme estimating will incorporate full project costs to complete the asset, identify full life cycle costs, and risks associated with the programme. The need for works to accommodate growth will be reviewed on an annual basis to take into account any changes to the anticipated growth rates or other demand drivers. Capital Renewal Planning Renewal planning will be based on a sound understanding of the condition and performance of the asset and aim to maintain the current overall service potential of the asset. The renewal programme will also aim to smooth out where possible the financial impact from year to year. Maintenance and Operational Planning Maintenance and operational planning will be reviewed on an annual basis but with particular focus at the AMP review as to whether the most cost effective delivery mechanisms are in place. This will also take account of any Council direction arising out of the Local Government Act Section 17A reviews. Service agreements with contractors will contain performance measures consistent with the AMP and Activity Key Performance Indicators (KPIs) to achieve alignment from the operational level to the 10 Year Plan KPIs. Demand forecasts Demand forecasts will take into account population, household and economic growth projections, social and demographic data, technological advances, and other relevant data. Demand management Demand management options will also be considered when planning to meet growth, and to ensure projects qualify for any external financial assistance. 20

37 Section 3 Strategic Environment Optimised decision making ODM techniques will be used for decisions related to significant projects. Risk & Resilience Risk exposure will be managed through: An annual review of the risk management plan and implementing risk mitigation measures where risk exposure is incompatible with corporate risk policy. Undertaking performance and condition monitoring of critical assets. Resilience of Council s critical assets to natural hazards will be assessed and programmes prepared to mitigate risk to an acceptable level. Information systems Data collection programmes (condition, asset performance, registers, and service performance) will be closely aligned to the nature and scale of the assets and to tracking achievement of service targets. AM system functionality will be progressively developed to meet the requirements of advanced AM planning. Asset Revaluation Asset revaluation will be undertaken in conjunction with City Corporate staff on a 3 yearly timeframe. Continuous Improvement An improvement programme will be included with each AMP review, setting out the areas of improvement required to practices, systems, processes and plans in the following 3 years with identified tasks and budgets. This will be part of the ongoing improvement programme in the City Networks Unit. Organisational Capacity and Development Adequate resources will be allocated to asset management to ensure that asset management practices can be undertaken to meet the requirement for robust AMPs and work programmes. AM capabilities will be developed to practice advanced asset management techniques. Monitoring and reporting on level of service performance measures. Those level of service measures that are adopted by the Council as KPIs will be reported through quarterly Annual Budget reports. Other LoS performance measures will be reported quarterly to the City Networks Executive Team (CNET). 21

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39 Section 4 Levels of Service 4 Levels of Service This section defines the level of service or the qualities of the service that the Council intends to deliver and the measures used to monitor this. The adopted levels of service are used to define the programmes to achieve the Council s strategic goals and are based on user expectations and statutory requirements. 4.1 Introduction A key objective of this AMP is to match the level of service provided by the asset with the expectations of the users of the service. This requires a clear understanding of user needs and preferences. The levels of service defined in this section will be used: to inform users of the proposed type and level of service to be offered; as a focus for the AM strategies developed to deliver the required level of service; as a measure of the effectiveness of this AMP; to identify the costs and benefits of the services offered; and to enable users to assess the suitability, affordability, and equity of the services offered. Levels of service for the Wastewater Activity are based on: Strategic goals (see Section 3.1.1) - These provide guidelines for the scope of current and future services offered, the manner of service delivery, and the specific levels of service which the organisation seeks to achieve. Statutory requirements/environmental standards (see Section 3.2.1) - Regulations, Acts, and Council Bylaws that impact on the way assets are managed (i.e. resource consents, building regulations, health and safety legislation). These requirements set the minimum level of service that must be provided. Community engagement and feedback (see Section 4.2) - Information gained over the last 3 years on LoS from specific consultation, customer service requests, Annual Budget submissions, and community surveys. The Department of Internal Affairs (DIA) mandatory measures were introduced in 2013 in order to establish a set of baseline data to enable performance to be measured comparatively between all Local Authorities in the country. The adopted levels of service indicators and measures presented in Appendix C have been grouped into two categories: Customer performance measures: These are measures of the overall activity, covering the aspects of service that are of most interest to the community and community satisfaction indicators. They include the government mandated non-financial performance measures to be included in the Year Plan. Some of the customer performance measures presented in Section 4 are expected to be included for community consultation in the consultation document and publicly reported against in each Annual Report. Technical performance measures: These are additional measures adopted to ensure that the customer performance measures are robustly achieved. They are used as a management tool and are measured and reported internally. 23

40 Section 4 Levels of Service 4.2 Community Input & Decision Making Process The levels of service upon which this plan is based have been derived from an on-going process of community consultation and consideration of levels of service options by the Council over a significant period of time. In 2005, an extensive level of service review was undertaken, which engaged with a broad crosssection of the community to understand how well existing services were meeting user needs, and what improvements were desired for the future. Specifically, the review set out to ascertain views on: The current levels of service provided by the Council. The desired future levels of service. Aspects of the services by which the quality of the services can be assessed. At that time, a greater user focus was introduced to the measures. This was reflected by having statements of the service provided to each of the key user groups and performance measures that reflected the user view of the LoS provided. Subsequently LoS reviews have been undertaken for each AMP review, in which information about LoS received from the community through local, Communitrak surveys, service requests, and Annual Budget submissions, has been presented to the Council in order to inform any changes that it may wish to make to the LoS delivered to the community. Generally, only minor adjustments have been made since For this AMP, LoS workshops were held with Councillors over March Information about the current LoS together with community feedback was presented to the Councillors. Councillors were asked to: Consider whether the current LoS was about right and what changes, if any, were required. Give direction on some specific LoS issues important to the activity. Generally, the Councillors considered the LoS to be about right. However, the following LoS matters were raised during the workshop and are taken account of in this AMP, as indicated in Table 5. 24

41 Section 4 Levels of Service Table 5: Matters Raised at Councilor LoS Workshop Matters raised at Councilor LoS workshops 23/24 March 2017 Increased focus on behaviour change and promotion of sustainable outcomes across all three waters Impact of inflow and infiltration on the wastewater network Optimised pipeline renewal strategies How these are included in this AMP Additional funding sought to support behaviour change initiatives as part of a three water new operating programme. Additional operational programme funding sought for a dedicated programme of work focusing on inflow and infiltration reduction. Enhanced investment in CCTV inspection to determine asset condition and remaining useful life. Use of lining to improve wastewater main life at a significantly lower cost than complete replacement. As part of the development of Council s strategic direction a number of Strategy Plans were developed during July and August 2017 (see Section 3). Some of the actions set out in these Strategy Plans have level of service implications for this AMP. These are shown in Table 6. Table 6: LoS Actions from Strategy Plans LoS actions arising from Council Strategy Plans July August 2017 Reduction of Rainfall induced infiltration Increased investment in pipeline renewals Reduce Overflow risks and frequency within Network How these are included in this AMP Specific additional funding inflow and infiltration operational programme. Request for a staged increase in the renewals budget during the first three years of the AMP. Continue to increase the use of relining options to increase the total length of sewer relined per annum. Specific renewal programmes targeting increased capacity in the network to limit the risk of overflows. Specific focus on looking to identify overflow locations within the network and establish monitoring if possible to measure frequency and volumes if they cannot be eliminated. 4.3 Communication of Levels of Service & Performance Measures Council s adopted LoS and KPIs will be publicly communicated through the Year Plan consultation document. 4.4 Current and Future Levels of Service & Performance Measures Council s adopted LoS and KPIs will be publicly communicated through the Year Plan consultation document. Users of wastewater services have been divided between domestic users, commercial users, and industrial users. The services provided for each are set out in Table 7 below Key Performance Indicators Target levels of service for the wastewater activity are shown in Table 7. Performance measures identified as new are as a result of mandatory non-financial performance measures specified by the Secretary for Local Government in accordance with Section 261B of the Local Government Act The new mandatory measures are required to be incorporated in the Council s Year Plan, and therefore will be reported against in Council s 2017/18 Annual Report. 25

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43 Section 4 Levels of Service 1 (28 per year) 3 (84 per year) 1 (28 per year) 1 (28 per year) 1 (28 per year) 1 (28 per year) 1 (84 per year) 1 (28 per year) 1 (28 per year) 1 (28 per year) 27 Table 7: Customer Level of Service, Performance Measures & Targets Key Service Criteria Stakeholders and User Groups Customer Level of Service Customer Performance Measure Current Performance Performance Targets 2018/ / / ~/22 Quality and Health All residents and users. MidCentral Health The Council provides a safe (i.e. no risk to public health) wastewater collection service. Goal 3 Goal 4 Residents are satisfied with the quality of Council s wastewater services. 95% 95% 95% 95% 95% Reliability All users The Council provides a reliable wastewater collection service. Goal 3 Goal 5 Odour complaints per 1,000 connections per year. 2 Fault complaints per 1000 connections per year (11 in total) 2.6 (73 in total) 1 (28 per year) 3 (84 per year) 1 (28 per year) 3 (84 per year) Blockage complaints per 1,000 connections per year (19 total) 1 (28 per year)) 1 (28 per year) Number of complaints about the Council s response to issues with the wastewater system per 1,000 connections per year 0.1 (3 in total) 1 (28 per year) 1 (28 per year) The Council provides a reliable wastewater collection service. Goal 2 Goal 3 Goal 4 The number of dry weather wastewater overflows from the Council s sewerage systems per 1,000 connections per year due to localised blockages 1 (28 per year) 1 (28 per year) The Council wastewater system is designed to adequate standards and is operated effectively Goal 4 Goal 5 Median response time for attending to overflows resulting from blockages or other faults. 0.4hrs <1.5hr <1.5hr <1.5hr <1.5hr 2 Mandatory measure from the Department of Internal Affairs 3 Mandatory measure from the Department of Internal Affairs

44 Section 4 Levels of Service <8hr (9.5hr total) <8hr (9.5hr total) <8hr (9.5hr total) Key Service Criteria Stakeholders and User Groups Customer Level of Service Customer Performance Measure Current Performance Performance Targets 2018/ / / ~/22 Responsiveness All users The Council responds to requests for service in relation to overflows, blockages and faults in a prompt and efficient way Goal 4 Goal 5 Median response time for resolution of overflows resulting from blockages or other faults. 2.3hrs <8hr (9.5hr total) Accessibility Residential and commercial property owners The Council provides wastewater services to residential and commercial areas of the City Goal 1 Goal 5 Properties (within the wastewater services area) are able to connect to the wastewater service. 100% 99% 99% 99% 99% Sustainability All residents. Horizons Regional Council. Rangitāne Manawatū River Leaders Accord The Council disposes of wastewater to environmentally acceptable standards Goal 3 Goal 4 Number of abatement notices. No non-compliance notices received Sustainability (Continued) All residents. Horizons Regional Council. Rangitāne Manawatū River Leaders Accord The Council disposes of wastewater to environmentally acceptable standards Goal 3 Goal 4 Number of infringement notices. 4 Number of enforcement orders. Number of convictions received by the Council in relation to resource consents A 30-year asset management plan is in place for the wastewater activity A 30 year asset management plan prepared, peer reviewed and adopted in September 2018 AMP in place (key projects from AMP will be outlined) AMP in place (key projects from AMP will be outlined) AMP reviewed (key projects from AMP will be outlined) AMP in place and reviewed 3-yearly with independent peer review (key projects from AMP will be outlined) Financial Management All wastewater ratepayers The Council manages its wastewater activity in a Wastewater rates are less than the average of the Achieved Target rate $ % 100% 100% 100% 4 Mandatory measure from the Department of Internal Affairs 28

45 Section 4 Levels of Service Goal 1 Ann innovative and growing city: Goal 2 A creative and exciting city: Goal 3 A connective and safe community: Goal 4 An eco-city: Goal 5 A driven and enabling Council. 29 Key Service Criteria Stakeholders and User Groups Customer Level of Service financially sustainable way Goal 1 Goal 5 Customer Performance Measure Current Performance national peer group. compared to national average around $400 Performance Targets 2018/ / / ~/22 The Council maintains and develops wastewater services to meet current and future needs Goal 1 Goal 5 Wastewater Capital programmes are delivered ahead of development demand Achieved. No developments delayed by lack of wastewater infrastructure Achieved Achieved Achieved Achieved The Council manages its wastewater activity in a financially sustainable way Goal 5 Wastewater Operational programme is provided within budget Achieved if BPO Project Excluded Achieved Achieved Achieved Achieved Note: Number of properties assumed to be 28,000

46

47 Section 4 Levels of Service Future Changes to Levels of Service The anticipated changes to the current levels of service over the next thirty years are: Table 8: Future Changes to LoS Future Changes to Current Level of Service and Impact on the Community and Costs Proposed Changes Community Impact Cost Impact Requirement for the use of pressure sewer systems in designated growth areas Increased standard of WW treatment to meet new consent requirements Localised impact All users of public wastewater Low High In the next twenty years, Council anticipates changes to the level of service in the following areas: Changes to resource consent requirements will necessitate improvements to the wastewater treatment systems to improve the quality of the wastewater effluent discharge. In renewing critical assets, consideration will be given to increasing capacity, or providing duplication of the assets, to improve security of the wastewater collection system. Designation of specific growth areas within the city North East Industrial Area and City West Residential zone as pressure sewer areas both to limit additional wastewater flows, enable cost effective service provision and provide greater resilience in liquefaction prone areas i.e. City West. These changes to levels of service have been allowed for in management of the wastewater assets. Capital development programmes to meet projected changes in levels of service are set out and discussed in Section Service Level Gaps Generally, the expected level of service is being provided, however, there are a number of areas where the performance of the existing assets needs to be improved and the level of service extended: Stormwater infiltration and inflow. (Prog City Wide Infiltration and Inflow Investigations) Capacity constraints in trunk main network. (Prog 452 Tremaine / Featherston Trunk Main Upgrade and Prog 660 Ferguson Street Trunk Main Upgrade) Key initiatives proposed to mitigate the negative impacts of the above effects include: Targeting wastewater pipe renewals in the catchments with the highest peak wet weather flows (Prog 54 City Wide Wastewater Pipe Renewal) Implementing an operational programme to support active CCTV and smoke testing with property level enforcement of improvements to exclude stormwater from the network (Prog 1401 City Wide Infiltration and Inflow Investigations) Implementation of networked pressure sewer systems in City West and North East Industrial Zone to limit flows, provide storage and exclude stormwater infiltration and inflow (Prog 210 Urban Growth Installation of Wastewater Systems for NEIZ and Prog 1055 Urban Growth City West Installation of Wastewater Systems) 31

48 Section 5 Growth and Demand The AMP has been prepared on the basis of wastewater collection provision to the area broadly corresponding to the residential and commercial / industrial areas shown in the current District Plan, and service areas outlined in the Wastewater Bylaw Generally, the expected level of service is being provided however, there are some areas where the performance of the existing assets will need to be improved to meet the current level of service. Capital development programs to achieve this, including the associated cost estimates, are set out and discussed in Section 6. 32

49 Section 5 Growth and Demand 5 Growth and Demand This section sets out the factors impacting on the management and development of the assets to meet the requirements of growth and other demands place on the wastewater assets as follows: Future demand drivers; Growth projections; Growth trends; Land-use strategies (residential, industrial, retail and rural-residential); Consumption and use patterns; Demand management strategies; and Climate change impacts on demand. 5.1 Future Demand Drivers The future demand for reticulated wastewater services in Palmerston North will be driven by: Residential and, industrial growth in the city. Changes in water consumption and usage patterns. Most water supplied for domestic, commercial, and industrial purposes is subsequently discharged into the wastewater system. Greater uptake of Low Pressure Sewer particularly in the pressure sewer designated areas. Changes in Council policy with regard to rural residential properties. The extent of stormwater entry to the wastewater system (infiltration and inflow). Future demand for treatment of wastewater driven by technology changes. Regional Council One Plan Standards Climate change. 5.2 Growth Projections Palmerston North is growing, and the Council has strong aspirations to accelerate growth and prosperity for the city. Council s strategic priorities are set out in Council s City Development Strategy, which drives the projects and programmes that the Council intends to implement. For planning purposes, the Council has decided to assume high growth projections for years 1-10, and a medium growth projection for years This is significantly greater than was assumed for the 2014 AMP, which was based on Statistics New Zealand medium growth projections adjusted for the local Palmerston North situation. The high growth projections for the first ten years gives more weight to the average annual gain from net migration and assumes a general long-term upward trend in inward migration than is accounted for in the Statistics NZ projections. The projections being used by the Council for the first 10 years are similar to the Statistics NZ high growth projections Population Growth The latest population projections for Palmerston North through to 2043 were published by Statistics NZ in December These suggest a declining rate of population growth over the projection period, 33

50 Section 5 Growth and Demand with a population projection of 102,400 5 in 2048 under the medium growth projection. However, because of the high recent rates of inward migration, Council is adopting a higher population projection than the Statistics NZ medium growth projections in the first 10 years. The projection for five year periods through to 2048 is depicted in Table 9. Table 9: Population Projection for Palmerston North Population projection for Palmerston North (September 2017) Average annual change Period ended Population count Number of people Rate of change (%) , ,700 1, % ,700 1, % , % , % , % , % , % 10-year projection % 20-year projection % 30-year projection % National Policy Statement Urban Development Capacity The National Policy Statement Urban Development Capacity (NPS-UDC) requires that the Council has 3 years supply of land ready to be developed with existing infrastructure (short term). It must also have 10 years of land zoned with infrastructure in its 10 Year Plan (medium term) and 30 years of land identified for growth with identified infrastructure in its 30 year Infrastructure Strategy (long term). It must also provide an additional margin of land and infrastructure over and above the projected demand of at least 20% in the short and medium term and 15% in the long term. For planning purposes, these additional margins have been added into the additional household numbers in Table 10. It is assumed that by adopting the high growth scenario for , the additional 20% capacity is provided for. The 20% margin has been added to the period, and a 15% margin to the period Household Growth The most recent household projections were published by Statistics NZ in December 2015 and are to An update to these projections is due to be published in December Council estimates have been made for changes in the period 2038 and Projected average annual household growth is not expected to slow to the same extend as the population growth rate because the average size of households is expected to reduce, primarily due to the aging population and an increase in the number of single person households. The numbers of households shown in Table 10 also include the additional margin required for land development in the NPS-UDC, and allow the numbers to be reconciled with the capacity being planned for in growth areas. 5 Based on Statistics NZ 2016 population projection with estimated projection between 2043 &

51 Section 5 Growth and Demand Table 10: Household Projection for Palmerston North Households projection for Palmerston North (September 2017) Average annual change Period ended Households Number of households Rate of change (%) , , % , % , % , % , % , % , % 10-year projection % 20-year projection % 30-year projection % Residential Development Type Housing preference trends have changed over time since Council began reporting on residential growth in In 2004 greenfield development made up 61% of development, infill was 27% and rural residential was 12%. Based on recent housing preference trends and experience of preferences during times of high growth distribution of dwelling types is based on the following. The table household numbers include the margin for the requirements of the NPS-UDC. Table 11: Residential Development Type Period Household per annum Greenfield Infill Rural Total % 33% 12% 4, % 38% 12% 2, % 38% 12% 1,890 9, Residential Growth Strategy The Residential Growth Strategy is outlined within the Council s City Development Strategy. Council s main role is to make sure land and infrastructure are available to accommodate growth and provide market choice, while responding to changing demographics. The private sector provides new housing in Palmerston North. Council will work closely with developers to co-create new housing opportunities, such as the proposed Hokowhitu Residential Area at Centennial Drive. The District Plan has been changed to provide more housing choices. Over the past 20 years, the main forms of housing development have been greenfield, infill subdivision, and lifestyle blocks. Greenfield housing typically occurs at the edge of the city on large sections, with recent development at Kelvin Grove and Aokautere, for example. Infill housing creates new smaller sections among 35

52 Section 5 Growth and Demand existing housing, with recent development in Hokowhitu, and the central city and hospital areas. Lifestyle blocks provide a housing choice in rural areas, with recent development on the foothills of the Tararua Ranges and elevated land north-east of the city. Other housing choices now allowed under the District Plan include multi-unit developments and minor dwellings. Multi-unit developments are encouraged close to the city and suburban centres, where there is ready pedestrian access to services and facilities. Minor dwellings are aimed at meeting the demand for small, good quality, and affordable rental accommodation. The planning framework enables apartments in or near the city centre, including as part of a mixed-use development. Council will actively identify opportunities and reduce barriers to city centre living and brownfield development, including transitioning Roxburgh Crescent from industrial to residential. The demand for infill housing is expected to continue. Lifestyle blocks are directed away from productive land and need to have their own infrastructure. Council wants land for new greenfield housing at Whakarongo brought to the market quickly. PNCC will work closely with landowners and promote Council-owned land at Whakarongo to help meet housing demand. To release pressure and meet updated growth projections, land at City West identified for medium to long-term greenfield housing will need to be released earlier. The most suitable land for early release is the area bound by the Mangaone Stream, Te Wanaka Road, and Pioneer Highway (the Racecourse land), which will need to be rezoned. The interests of private developers at the outer edge of City West could affect the cost-effective and efficient provision of network infrastructure. Council needs to work with the major landowner in this area to better understand the infrastructure options and timing of the rezoning. Substantial greenfield housing capacity remains at Aokautere, but plans for developing the remaining residential land are unclear. Council will develop a structure plan with the major landowners to guide future development. There is a need to connect the end of Pacific Drive with existing roads in the Turitea Valley. As well as the Hokowhitu Residential Area, Council will work with landowners at Napier Road and Flygers Line, where small greenfield additions can be made without the need for substantial new infrastructure. A revised plan is needed to develop affordable and first homes at Ashhurst, taking into account detailed flood investigations of land north-west of the village. The growth areas identified with assumed timescale for greenfield development are shown in Table 12. This shows how the projected demands on greenfield development will be met in the short, medium, and long term. Table 12 also shows the number of lots expected to be provided in each area. The locations are shown spatially on Figure 5. Table 12: The staging and timing of residential greenfield areas Greenfield Development Areas Location Lots Years 1-5 Years 6-10 Years Years Years Aokautere 759 Ashhurst 88 Kelvin Grove 264 Whakarongo 500 Hokowhitu 130 Flygers Line 150 Zoned Land Short to Medium Term Rezoning 36

53 Section 5 Growth and Demand Greenfield Development Areas Location Lots Years 1-5 Years 6-10 Years Years Years Napier Road 50 Ashhurst Future 250 Racecourse 220 Aokautere Extensions 400 Pioneer City West 800 Medium to Long Term Rezoning City West (less Racecourse & Pioneer City West) 1680 The location of these areas is shown on Figure 5. 37

54 Section 5 Growth and Demand Figure 5: Map showing location of proposed residential development 38

55 Section 5 Growth and Demand 5.4 Industrial Growth Strategy The strategy prioritises industrial growth: In the short to medium term at the North East Industrial Zone (NEIZ), and the recently rezoned Extension Area for large floor plate transport, warehousing, and logistics activities. Longburn is viewed as a suitable location for wet industry. North East Industrial Zone The NEIZ (86 ha) was rezoned in As at March 2017, 46 ha is developed or purchased for development and not available to the market. Since 2004 the annual uptake of land at the NEIZ is approximately 3.5 ha. It is anticipated that the annual uptake of land in the NEIZ will exceed 3.5 ha in the next 3 years. NEIZ Extension Area The 126 ha NEIZ Extension will be sufficient to meet the growth of large floor plate industrial activity over the next 20 to 30 years. Forecasting the market s timing around sizable investment decisions for large format transport and logistics activity is problematic. Particularly when the nature of investment is lumpy and Council is seeking to forecast the investment profile over a 20 to 30 year time-period. Infrastructure Roll-Out and Staging For the purposes of infrastructure roll-out, Figure 6 shows the expected progress of development in the Extension Area. From Council s perspective, it would be more cost effective to start providing infrastructure in the area shown in Stage 1. It is envisaged the land fronting the Roberts and Richardson s Line corner / intersection will first to be developed. Figure 6: Map of NEIZ Infrastructure Roll Out 39

56 Section 5 Growth and Demand Longburn Longburn remains the preferred option for the development of wet industry given its connection and proximity to the wastewater treatment plant. Council s infrastructure funding priorities for industrial growth in the short to medium term remain at the NEIZ and Extension Area. Figure 7 shows the extent of the existing industrial zone at Longburn, which comprises approximately 42 ha of which some 35 ha has yet to be developed or remediated to enable development to occur. Longburn - Sub-Optimal Infrastructure and Pressure to Rezone Additional Industrial Land Council is coming under pressure to rezone additional land in the Works Road area of Longburn. Part of the existing Works Road industrial area is serviced by private infrastructure that does not meet Council s engineering standards and Council is unwilling to approve rezoning of additional industrial land that is reliant on sub-optimal private infrastructure. Braeburn Industrial Area Figure 7: Map of Existing Industrial Zone at Longburn Plan Change 15F rezoned a 33 ha extension to the existing Longburn Dairy Manufacturing Site (LDMS) in The rezoned land is identified as the Braeburn Industrial Area (BIA). The purpose of the BIA is to primarily provide for dairy related industrial activities to support the ongoing operational and growth needs of Fonterra s existing LDMS. It is envisaged the BIA will remain in the single ownership of Fonterra and is not for the purpose of meeting the wider industrial land needs of the City. 5.5 Office and Retailing (Commercial) Land Use Strategy The Council s centres based strategy seeks to keep commercial activity centred in the core of the city and to avoid the dispersion of this activity to the periphery of the urban area particularly in the city s Industrial Zones. This strategy is given effect to through the District Plan hierarchy of business zones as follows: 40

57 Section 5 Growth and Demand Inner Business Zone (IBZ). Outer Business Zone (OBZ). Fringe Business Zone (FBZ). Local Business Zone (LBZ). The IBZ is the zone where planning for infrastructure is most critical. The IBZ seeks to provide a high amenity, connected, and pedestrian focused city centre that meets the business, social and cultural needs of the community. IBZ development looks to leverage of public investment and in most cases will utilise public on-street parking. City Centre Streetscape Plan (CCSP) Any planned works in the IBZ need to align with the outcomes sought by the CCSP. The Plan sets out the future design direction for the streets and spaces in the city centre. The CCSP is guided by a number of Council strategies, including the Urban Design Strategy, the City Centre Framework, and the Street Design Manual. Importantly, the scope of the CCSP extends to streetscape upgrades including carriageway, parking, footpaths, hard and soft landscape, as well as Palmerston North's urban and inter-regional bus terminals. To achieve the outcomes sought by the CCSP any infrastructure project will need to be informed by a multi-disciplinary team working in collaboration. OBZ development is more self-sufficient than IBZ development and is required to provide on-site parking. FBZ development is large format retailing and is also required to provide on-site parking. LBZ development provides local amenities and is expected to provide on-site parking. All business development other than some LBZ development looks to leverage of existing infrastructure as it is effectively a form of brownfield development. Figure 8: Map of Spatial Extent of the Business Zones 5.6 Rural Residential Strategy The District Plan discourages lifestyle blocks and further fragmentation of productive farmland. This land is a scarce resource and represents a significant economic opportunity for future generations, as identified in the regional growth study. It is also a valuable resource for sustainable local food 41

58 Section 5 Growth and Demand production. Substantial capacity for lifestyle blocks is provided on the foothills of the Tararua ranges to ensure they remain a legitimate housing choice in the City. The provision of urban services, in particular reticulated services, is discouraged in rural areas. The provision of reticulated services in rural areas is an inefficient form of infrastructure investment. It also blurs the lines between rural and urban development and leads to confusion about future development opportunities. Many landowners see the provision of urban services as legitimising further intensification while others see it is undermining the specific rural amenity they sought out. Careful implementation of the new District Plan rural subdivision provisions is essential. 5.7 Other Demand / Consumption Projections / Patterns Wastewater Collection Services Demand/Wastewater Production Trends The demand for wastewater collection services is dependent upon the volumes of wastewater produced and the extent of the collection service Changes to Water Use Pattern With the exception of water used for irrigation and unaccounted for water, most water supplied by the Palmerston North City water supply system is subsequently discharged into the wastewater reticulation. Changes in water consumption patterns are therefore likely to be reflected in corresponding changes in discharges to the wastewater system. Domestic Water Demand Domestic consumption trends are surveyed from a sample of metered properties that are manually read every two months. Figure 9 shows the previous five years of demand in terms of average daily demand per property for 51 properties. Whilst this includes irrigation and consumptive water use and is a small sample set it still provides some indication of domestic demand trends. The survey set has recently been increased to some 94 properties in order to better represent domestic demand. Figure 9 shows the range in water use for each property, including the median and 25th to 75th percentile band. The error bars indicate the properties with the minimum and maximum water demand. Increases in surveyed domestic consumption in the last two years correlate to periods of severe droughts. It appears that peoples behaviour responded to the drought in 2013/14 as water restrictions did not have to be instigated until very late in the drought. 42

59 Section 5 Growth and Demand %ile to 75%ile Median Annual Rainfall Annual Rainfall [mm/yr] Average Daily Demand [L/prop/day] / / / / / / / /17 Figure 9: Average Daily Demand of Metered Properties 4000 Also plotted in Figure 9 is the One Plan s allocation for total domestic use, which equates to 753 L/property/day (derived from an allocation of 300 L/person/day and the average occupancy rate from the 2013 census). The current domestic water use is well within the allocation under the One Plan s Regional Policy Statement. Non-Domestic Water Consumption The majority of significant non-domestic (industrial and commercial) water supply users are metered and charged per cubic metre of water used. 2,500 Metered Commercial & Industrial Customers City Council Parks & Facilities Annual Metered Water Demand [ML/yr] 2,000 1,500 1, / / / / / / / / / / /14 Figure 10: Historical Metered Non-Domestic Water Demand 43

60 Section 5 Growth and Demand As shown in Figure 10, the amount of water used by these customers varies greatly from year to year and can partly be attributed to: Seasonal variation for users that have significant irrigation needs; The economic climate, as seen in the drop around 2008; Several of the top customers moving to new premises; and Improvements in the way the City Council uses water in its parks and facilities. It is difficult to predict the nature of these customers in the future. For this reason, it is assumed that the future makeup will be similar to the 2016/17 demand summarised in Figure 11 below. The designation of the North East Industrial Zone as a pressure sewer area is designed both to restrict the type of development which can occur but also match wastewater services to the low wastewater flows from the predominantly warehousing and logistics type businesses which have been developing in this area. The change will significantly reduce the wastewater design capacity which must be allowed and help to defer any requirement to upgrade the western trunk sewer which serves that area. Average Daily Water Consumption for 2016/17 [m 3 /day] PN Residential 14,936 Ashhurst 1,157 Bunnythorpe 169 Commercial / Industrial 4,990 Longburn 113 Water Loss 4,982 Figure 11: Breakdown of Average Daily Water Consumption for 2016/ Projected Flows & Loads Projections of flows and loads arriving at the Totara Road WWTP are summarised below. The projected flows and loads include contributions from the villages and the proposed NEIZ extension and will be reviewed once work on a pressure sewer network in the NEIZ has been designed. Table 13: Totara Road WWTP Project Flows & Loads Year Connected Population ADWF [m 3 /day] PWWF [m 3 /day] CBOD 5 [kg/day] TSS [kg/day] TKN [kg/day] Current 73,622 27, ,000 8,366 9,400 1, ,563 35, ,557 8,922 10,025 1, ,403 37, ,993 9,472 10,643 1, ,072 39, ,680 10,116 11,367 1,774 44

61 Section 5 Growth and Demand Wastewater from Private Systems The two largest private sources of wastewater are from Massey University and the Linton Military Camp. Wastewater from both sites is treated at the Council s Totara Road WWTP. Previously, an agreement was reached to accept a smaller volume of wastewater from an existing industrial development in Works Rd, Longburn, and to accept a limited volume of waste from the NZ Pharmaceutical s site, via the Linton connection. Officers are involved in consultation and further assessment work to better define the future flows and loads from the Linton Military Camp, NZP and the Works Road Longburn Industrial Estate. There is also increasing pressure to install low pressure (pumped) systems into rural residential subdivisions which then connect to Council reticulation. To date one rural subdivision was given approval to connect to Council services, namely the Kingsdale Park subdivision off the Pahiatua Track. Council s district plan seeks to prohibit the expansion of reticulated water and wastewater services into the rural and rural residential zones. It is not expected that there will be any further servicing developments of this type approved in the future. While the flows from such systems are small and lower than from traditional gravity sewer systems, the cost of assets per property serviced is significantly higher than for the residential zone, resulting in an essential subsidy from existing properties to rural dwellings Wastewater from Other Sources Septage tankers collect waste from septic tanks and other sources, and are only permitted to discharge to the wastewater system at the Totara Road WWTP via a specially constructed receiving facility. Volumes discharged are low and typically comprises 2-4m 3 /week although the discharges are concentrated with high solids and organics concentrations Stormwater Inflow & Infiltration It is estimated from variations in flows through the Totara Road WWTP that stormwater makes up 20 45% of total annual wastewater volumes in Palmerston North, depending on the frequency and intensity of rainfall events. On-going investigations, including CCTV and property inspections, are occurring to attempt to better manage this issue although it is not expected that significant reductions in flows can be achieved. Current wastewater pipe renewal programmes are focused on areas with high inflow and infiltration. Additional funding has been sought to support a dedicated programme to fund a contract position dedicated to investigating and following up on both private property and public stormwater ingress. In projecting future wastewater volumes, it has been assumed that the inflow and infiltration programmes currently underway will mean that inflow and infiltration will remain at current levels and not increase. Some further analysis of the possible reductions in levels of inflow and infiltration that might be achievable will be undertaken Regional Council One Plan Standards Increased treatment standards and in river targets are expected to be reflected in high treatment standards for wastewater that is to be discharged to the environment and into water ways in particular. This will impact on the extent and capacity of new wastewater treatment systems to be constructed as a result of the new resource consents required at the Totara Rd Treatment Plant. 45

62 Section 5 Growth and Demand Council will continue to work proactively with Horizons Regional Council to identify the best means of achieving improvements in wastewater quality outcomes, in a way which is both practical and cost effective National Policy Statement Freshwater Management Legislative change through the implementation of National Policy Statements will result in heightened expectation that Council achieves meaningful improvements in wastewater discharge quality Technology Changes Technology changes, such as composting or waterless toilets, are frequently touted as a means of decreasing water consumption and wastewater discharges. However the uptake of these technologies is likely to be very low and health concerns also mitigate against their widespread adoption. Low Pressure Sewer Systems (LPS) and potentially Vacuum Sewer Systems (VSS) have evolved and become a viable alternative for areas which are low lying, suffer from high groundwater levels and be susceptible to liquefaction in seismic events all factors which make conventional gravity sewer systems less attractive. A key advantage of the LPS systems is their provision of property level storage which provides flow buffer resulting in significantly lower wastewater peaks and the options to hold back flows when the receiving network is at or over capacity. LPS are also very effective at restricting stormwater and ground water infiltration given wastewater can only enter the house or property gravity network which is very limited in extent. As part of work associated with considering alternatives for Wastewater BPO Project, a comprehensive review will be undertaken of all the technologies which might be adopted to reduce or limit future wastewater flows. The technologies and strategies will be evaluated using local information to determine the extent of any impact on flow under both voluntary and mandatory regimes. Council s Trade Waste Bylaw provides a regulatory mechanism for controlling the volume and strength of trade waste discharges. It allows for potentially large discharges to be controlled to reduce or avoid the impact of the discharge on the capacity of Council s wastewater collection, treatment, and disposal assets. The Trade Waste Bylaw is seen as the preferred mechanism for controlling volumes in different parts of the wastewater network, and in particular, in respect of any new and existing wet industries. 5.8 Demand Management In response to wet weather overloading of the wastewater system, City Networks has adopted a range of strategies, including: Programmes to reduce the entry of stormwater to the wastewater system in private properties (infiltration/inflow programmes). Renewal of pipelines where there is excessive entry of stormwater and / or groundwater through defects in the pipes. Providing additional capacity in parts of the wastewater system. Proposing the designation of areas where LPS or VSS must be used. 46

63 Section 5 Growth and Demand 5.9 Sensitivity to Demand Changes In projecting the future wastewater demand, it has been assumed that: The discharge per head of population will reflect water usage patterns and will remain constant, or decrease slightly. Average dry weather flow increases over the period by approximately 20% to 33,000 m3/day. Current inflow and infiltration levels will not increase. The proportion of major wet industries in the City will not increase Climate Change Impact on Demand The projected impacts of climate change are likely to become more noticeable towards the end of the planning period of this AMP, and have greatest relevance to water supply, wastewater, and stormwater assets. The New Zealand Climate Change Office has released a report on the impacts of the changing climate in New Zealand which concludes: Higher temperatures, more in the North Island than the South (but still likely to be less than the global average). Rising sea levels. More frequent extreme weather events such as droughts (especially in the east of New Zealand) and floods. A change in rainfall patterns higher rainfall in the west and less in the east. The Ministry for the Environment has predicted impacts of a moderate rate of climate change for the Manawatū-Wanganui region, including changes in average temperature, sea level rise, and rainfall patterns. In general, Manawatū-Wanganui, like much of the west coast of New Zealand, is likely to become warmer and wetter. Climate scientists estimate that average temperatures in Manawatū-Wanganui could be up to 3 C warmer over the next years. This compares to a temperature increase in New Zealand during the last century of about 0.7 C. Current research and monitoring suggests that the main impacts of climate change on the wastewater activity will be an increase in the frequency and intensity of rainfall events and hence potential increases in inflow & infiltration. This will require Council to continue to adopt an aggressive approach to identifying and reducing I&I if wastewater flows are not to exceed existing network and pump station capacity. 47

64

65 Section 6 Assets & Lifecycle Management 6 Assets & Lifecycle Management This section provides the detail of the key asset components comprising the Wastewater Activity together with individual AM strategies and plans for the maintenance, renewal, and development of these assets. 6.1 Overview of Wastewater Network Assets Description of Assets Council owns and operates four distinct gravity wastewater networks from which, wastewater is pumped to the Palmerston North Network or the Totara Road Wastewater Treatment Plant. The networks include: Palmerston North, including, Linton, and Aokautere; Ashhurst Bunnythorpe and Longburn. The Palmerston North network collects wastewater from urban areas of the City and from the residential areas of Aokautere, and Linton (including the Army Camp and Manawatū Prison). The wastewater collection network is divided up into catchments which are largely based on the natural topography of the City. The layout of the City s trunk mains and catchment areas is shown in Figure 12. In Palmerston North City, four trunk mains collect wastewater from individual properties through a reticulation network of pipes and manholes to deliver the wastewater in a general north-east to southwest direction to the Totara Road WWTP in the Awapuni area. A number of low lying areas require wastewater to be pumped into these trunk mains. There are 28 wastewater pump stations in the City wastewater collection network. Council operates separate wastewater networks for Ashhurst, Longburn, and Bunnythorpe. The wastewater from Ashhurst is pumped to the Palmerston North City reticulation via a pump station located next to the existing oxidation ponds and a 9km rising main, to a discharge point in Rosalie Terrace. The Ashhurst system comprises a collection network, two pump stations, oxidation ponds where the wastewater is partially treated, and a 250 mm diameter rising main. Longburn has a sewer network with 102 connections and two pump stations. The wastewater is pumped to Palmerston North City via a 300 mm diameter rising main. Bunnythorpe is also served by a separate gravity wastewater system including three pump stations. Since 2016 the wastewater has been pumped to Palmerston North for treatment via a 150 mm rising main in Railway Rd. 49

66 Section 6 Assets & Lifecycle Management Figure 12: Wastewater Catchments 50

67 Section 6 Assets & Lifecycle Management The broad asset groups and their replacement values as at 30 June 2014 are summarised in Table 14. Table 14: Replacement Value of Wastewater Assets Asset Component Quantity Replacement Value Pipelines 418km 138,594,111 Manholes 5679 $30,312,864 Laterals 27,783 $68,948,126 Pump Stations 36 $6,037,242 Treatment Plants 1 $44,816,718 Oxidations Ponds 1 $1,368,890 Valves 109 $570,484 Total $290,648, Wastewater Supply Asset Components Each wastewater scheme is made up of three different asset groups which link together to make a wastewater system as shown in Figure 13. Wastewater Collection Network Pump Treatment Plant Figure 13: Wastewater Supply Asset Component Groups 6.2 The Wastewater Collection Assets The wastewater collection system comprises: Sewer laterals. Gravity sewer pipes. Manholes. 51

68 Section 6 Assets & Lifecycle Management Pumped sewer pipes. The wastewater collection network within Palmerston North is delineated into the following catchments: The Western Trunk Sewer Main Catchment The Western trunk sewer main, which was constructed over the period , drains the northern perimeter of the City, extending some 15 km from Kelvin Grove in the east to Maxwell s Line in the west. Recent developments have involved extending this to the intersection of Railway Rd and Roberts Line to collect waste from the NEIZ area. Downstream of Tremaine Avenue, the system has been duplicated, with both lines delivering flow to the Maxwell s Line Pumping Station. This pump station discharges through a rising main and gravity sewer along Maxwell s Line, joining the other trunk sewer mains between Otira Place and the WWTP. The bulk of the pipework in this catchment is rubber ring jointed reinforced concrete pipe Featherston/Tremaine Trunk Catchment This trunk sewer main serves the northern part of the main City area, generally between the railway line and Grey Street in the east, and extending as far south as Ferguson Street further west. It interconnects with the Ferguson Street trunk sewer main and the Western trunk sewer main between Rugby Street and the WWTP Ferguson Street Trunk Catchment The Ferguson Street trunk sewer extends from the intersection of James Line and Rosalie Terrace, and receives flows from Ashhurst, the southern part of the City between the Featherston Street catchment to the north, and the Eastern trunk sewer main to the south. The original earthenware pipe was replaced after 1973 by a new mm concrete pipe, with the old pipeline left in some areas to act as a rider line interconnected with the new pipes Eastern Trunk Catchment The Eastern trunk sewer main sewer was completed in 1968 and was designed to handle flows from Aokautere and Massey, and also to relieve the Ferguson Street trunk by taking flows from the south east of the City through pumping stations at College Street and Jickell Street. The trunk is served primarily by these pump stations, with a connection to the Massey pump station by a pipeline across the Manawatū River bridge Confluence of Trunks In the south-western part of the City around Maxwell s Line, the sewer trunk mains converge on the Totara Road WWTP. The Western trunk sewer main flows are delivered along a rising main in Maxwell s Line, which gravitates past Racecourse Road and Otira Place, where the flows from the Tremaine/Featherston and Ferguson trunk sewer mains join the system. The College Street trunk and Eastern trunk sewer mains join the other trunks in Totara Road, from where wastewater is transported to the Treatment Plant through parallel 1350 mm and 900 mm pipelines. 52

69 Section 6 Assets & Lifecycle Management Aokautere Reticulation A separate reticulation system services the Aokautere Village and is connected to the Palmerston North system at Cashmere Drive via a pump station in Peterson Rd and a 100mm diameter rising main Linton Reticulation A separate reticulation system services the Linton area and is connected to the privately owned Linton Army Camp system. The Linton Army Oxidation Pond discharge to the Manawatū River was discontinued in 2006, and a direct pumped connection was made via a private pipeline to the Totara Road WWTP Ashhurst Reticulation A separate reticulation system services the Ashhurst area. Wastewater from Ashhurst is pumped to Palmerston North City via a pump station installed next to the existing oxidation ponds and a 9km rising main discharging into the top end of the Ferguson trunk in Rosalie Terrace. The Ashhurst scheme was installed in the 1980 s, with most of the pipework being either reinforced concrete or PVC Bunnythorpe Reticulation A separate reticulation system services the township of Bunnythorpe. Wastewater from Bunnythorpe is now pumped to Palmerston North for final treatment from the Kairanga-Bunnythorpe Rd pump station upgraded in 2016 to deliver larger flows direct to Palmerston North Longburn Reticulation A separate reticulation system services the township of Longburn. Wastewater from Longburn is pumped to Palmerston North City through two pump stations located in Reserve Rd and Walkers Rd, via the 300mm diameter rising main servicing the Works Rd Industrial subdivision. 6.3 Wastewater Collection Asset Attributes Data on the collection network is held in the INFOR database. There is reasonably good information about the main sewers and manholes. Data on laterals is incomplete, and the number of laterals is based on the number of properties rated for wastewater, excluding properties where the wastewater pipe is located on the property, and an estimated average lateral length of 9m and an assumed diameter of 100 mm. 53

70 Section 6 Assets & Lifecycle Management Figure 14 shows an age profile of the wastewater pipelines. It indicates that, although the first pipes in the network were installed in 1890, most of the network is relatively young, with 60% of the network installed after Length of Wastewater Mains [km] Age Range [years] Figure 14: Wastewater Pipe Age Figure 15 shows that the network is predominantly constructed of reinforced concrete pipes (55%), with smaller lengths of earthenware (23%) and PVC (22%). 250 Length of Wastewater Mains [km] Glazed Earthware Concrete Plastic Other Pipe Material Type Figure 15: Wastewater Pipe Material 54

71 Section 6 Assets & Lifecycle Management Figure 16 indicates that the network largely consists of small diameter pipes, with 150mm diameter pipes making up 53% of the network. 250 Length of Wastewater Mains [km] Pipe Diameter [mm] Figure 16: Wastewater Pipe Diameters Wastewater Collection Asset Condition Table 15 summarises the wastewater collection system assets, including the condition and performance grading for each asset type. Condition grading confidence level descriptions are provided in Appendix G. Asset condition is graded on a scale of 1 to 5 (excellent to poor) based on guidelines from the International Infrastructure Management Manual. Details are provided in Appendix G. Table 15: Collection System Assets Component Quantity Description Condition Rating Performance Rating Public Laterals 242 km Typically 100 mm dia. pipes connecting properties to the public mains from the point of connection Gravity Sewer 418km Non pressure pipes sized between 150 to 1350 mm dia Manholes 5,679 Access points located at changes in direction or grade and intersections between public mains Pumped Sewer 29.6km Pressure pipes supplied from associated Pump Stations The overall condition of the collection network is considered to be good. This assessment has been based on: The current low level of maintenance problems and premature failures. The relatively young age for the majority of the pipes. Good design and construction standards used to develop the wastewater network. Generally favourable ground conditions in the City. Results of CCTV inspections of a selection of the network. 55

72 Section 6 Assets & Lifecycle Management Additional condition assessments have been based on Closed Circuit TV (CCTV) surveys which provide specific condition data. Since 1988 CCTV inspections have been carried out on approximately 39% of the pipe network which are typically older earthenware or concrete pipes. Surveys were carried out to investigate specific network problems and for condition assessments. Figure 17 shows the areas surveyed as of CCTV inspections have shown that age of pipe alone is not a good indicator of pipe condition. Other factors influencing condition include: Circumferential cracking in older earthenware pipes. Corrosion of concrete pipes particularly in the vicinity of major pump stations due to acid attack from hydrogen sulphide gas exacerbated by turbulent flow conditions. These pipes are to be more closely monitored to enable timely replacement or rehabilitation. Tree root intrusion Several of the City's streets suffer significant blockage problems due to tree root entry of the sewer mains. This is also one of the main causes of sewer lateral failure within the road reserve. Many of the earthenware sewer mains laid by the Housing Corporation were located along the rear of the houses in private and these are particularly prone to tree roots intrusion in well planted sections. Poor pipeline grades Areas of the City that were built on previous swampy land have settled unevenly so that there are sections with uneven or very flat grades. While this affects sewer laterals more than sewer mains, Council has a proactive mains flushing programme in place to mitigate blockage risks in these sewers. All CCTV records are catalogued in the INFOR Asset Management System and linked to the GIS. This allows pipelines with a CCTV record to be viewed spatially on any networked PNCC PC. The NEZTEK Data Exchange Utility enables CCTV condition grading information from contractors to be imported into the INFOR AMS. This improves the efficiency and effectiveness of asset planning. Figure 17: Location of CCTV Surveys Completed 56

73 Section 6 Assets & Lifecycle Management Wastewater Collection Asset Capacity and Performance The overall performance of the wastewater collection network is considered to be satisfactory. Performance assessments have been based on: The number of pipe blockages. The number of sewer overflows. The volume of stormwater inflow and infiltration. The following Figure 18 and Figure 19 depict the incidence of pipe blockage by age and diameter. Blockage and Breakage at 2014 AMP Blockage and Breakage at 2017 AMP Number of Blockage in Wastewater Mains Since 1998/ Age Range [years] Figure 18: Pipe Blockage and Breaks by Pipe Age 57

74 Section 6 Assets & Lifecycle Management Blockage Breakage Number of Blockage & Breaks in Wastewater Mains Since 1998/ Pipe Diameter [mm] Figure 19: Pipe Blockage and Breaks by Pipe Diameter Blockage Rate 2017 AMP Technical Performance Measure 30 Blockage per 100km wastewater mains [No./100 km] / / / / / / / / / / /18 Financial Year Figure 20: Pipe Blockage & Breaks Long Term Trends Blockages Blockage records held since June 1996 show that the number of blockages per year had remained relatively constant before an up-swing over the period , which was primarily related to third party damage from the Ultra-Fast broadband program in the city. It can be assumed that the background level of breaks has remained fairly steady indicating the service potential of the system is being maintained. 58

75 Section 6 Assets & Lifecycle Management For 2016/17 the number of mains blockages was 19 per 100km of mains, which was below the number of blockage specified in the technical performance measures for levels of service. A target of 1 blockage per 1000 customers has been adopted in accordance with DIA requirements. The causes of blockages are: Uneven grade. Tree roots. Offset pipes. Structural collapse. Build-up of fat or gravel. Foreign objects. Third party damage Overflows Overflows can occur through a service defect such as pump failure or blockage, or through wet weather flows exceeding the capacity of the pipeline or pump stations. The City does not have a major overflow problem, and only during prolonged periods of heavy rainfall does the network become surcharged sufficiently to cause overflow at a number of known low spots around the City. Part of this problem is thought to be due to the entry of ponded stormwater to the wastewater network in a number of low lying areas in the city, which greatly increases the rate of inflow and infiltration into the wastewater system. Areas with overflow problems include the low lying areas of the Tremaine/Featherston catchment, and the top end of the Western Trunk. Where practical, properties with known overflow problems have been fitted with reflux (non-return) valves to their connections to prevent backflow. Stormwater Inflow & Infiltration Extensive flow monitoring undertaken since 1997 has enabled the assessment of the performance of the various sewer sub-catchments in terms of stormwater inflow and infiltration (I&I) in the wastewater network. Figure 21 depicts the severity of I&I in the wastewater catchments as assessed in Red areas shown are those with the highest stormwater inflow and infiltration (GHD 2013). 6 The R% is the percentage of rainfall volume in any rain event that is estimated as typically entering the wastewater network in each catchment and it is one of a number of indicators of the severity of I&I. The catchments with the highest assessed I&I have also been the focus for the network renewal programme over the last few years. 6 GHD, NEIZ WW Capacity Assessment, 2013 DM

76 Section 6 Assets & Lifecycle Management Figure 21: Catchment Inflow & Infiltration 6.4 Wastewater Pump Station Assets Wastewater Pump Station Asset Attributes There are 28 pump stations in Palmerston North: 2 in Longburn, 3 in Bunnythorpe, and 2 in Ashhurst, that lift wastewater from low lying areas into the gravity wastewater collection network. The major pumping stations in the city are Maxwell s Line (pumping 25% of the City s wastewater flow), Massey, College St, Jickell Street, and Ashhurst Ponds. Table 16 summarises the wastewater pump station assets. Complete pump station asset information can be found in Appendix H. 60

77 Section 6 Assets & Lifecycle Management Table 16: Wastewater Pump Station Condition & Performance Ratings Pump Station Capacity (l/s) No Pumps Year Built Year Renewal Condition Rating Performance Rating Maxwells Line Admirals Place Alderson Drive N/A 1 1 Aokautere N/A 1 1 Ashhurst Ponds N/A 1 1 Capri Place Cashmere Drive / College St Coutts Way N/A 1 1 Durham St (Ashhurst) / Food Stuffs Railway Rd Freedom Drive New 1 1 Grand Oaks Dr N/A 1 1 Jickell St KB Road - Bunnythorpe New 1 1 Kensington Mews Maple St - Bunnythorpe Not Rated Not Rated Massey Newton Place Racecourse Rd / Railway Road - Bunnythorpe Not Rated Not rated Redwood Grove N/A Reserve Rd - Longburn Roy Street N/A Ruamahanga Cres N/A Ruapehu Dr N/A 1 1 Ryder Cheshire N/A Shirriffs Rd Sutton Place Te Awe Awe St Te Wanaka Rd Tremaine Ave Vogel St Walkers Rd - Longburn Wikiriwhi Crescent Condition and performance grading confidence level descriptions are provided in Appendix G. All pump stations are unmanned with automatic operation of the pumps being controlled by various level sensing devices and pump controllers. The installed pumps operate on an alternate cycle so that 61

78 Section 6 Assets & Lifecycle Management wear is equalised between the pumps. telemetry system. Pump operation is monitored using Abbey s Powerlink To cater for major power outages, standby generators have been installed at three of the biggest pump stations: Maxwell's Line, Jickell St, and Massey. All other pumping stations have a portable generator connection. The portable generators owned by Council are able to power at least one pump in the larger pump stations. Figure 22: Location of Wastewater Pump Stations 62

79 Section 6 Assets & Lifecycle Management Wastewater Pump Station Asset Condition Table 17 contains a summary of the condition for each of the pump station. Additional detail is included in Appendix H. It can be seen that the majority of the pump station assets are in good to excellent condition. The lower condition score pump stations (3 or 4) have been marked down on the basis of the condition of the electrical and control equipment rather than the civil (Concrete) structures. Figure 23: Photo of Wastewater PS in Grand Oaks Drive Wastewater Pump Station Asset Capacity and Performance Pump Capacity Pump stations are generally designed so that the installed pumping capacity is twice that required to meet wet weather flows. This allows for one pump, in the event of a main pump failure or removal of a pump for servicing, to meet the required level of service. Studies undertaken in 2011 indicated there were two pump stations with insufficient capacity. These were Massey Pump Station and Maxwell's Line Pump Station. Maxwell s Line requires all four pumps to run during a prolonged significant wet weather event. In some events, Maxwell's Line Pump Station had not been able to cope with the flows and overflows had occurred at the top end of the Western trunk sewer main. Although an overflow is a rare event, it showed that there was very little spare capacity in the system. Upgrade works were completed in 2013 and 2017 and all four of the existing pumps were replaced with pumps of larger capacity and greater efficiency. Investigations at Massey pump station showed that all three pumps were operating at significantly less than their theoretical capacity. Further investigations revealed that the constraint was in the capacity of the rising main. The operating regime used at Massey pump station resulted in lower pipe velocities than those necessary to prevent settlement of solids. In addition, the existing pumps had high wear and lower than desirable efficiencies. The pumps at Massey pump station have now been replaced with new, high efficiency pumps, and the operating philosophy changed to ensure regular flushing flows are created to prevent settlement in the rising main. 63

80 Section 6 Assets & Lifecycle Management Wet Well Storage In the event of complete pump failure (usually from power outage) all pump stations are designed with at least 4 hours storage at inflows of 4 x average dry weather flow. The exceptions to this are Massey pump station, which has approximately 2 hours storage at peak flows before overflow to the Turitea Stream occurs, and Jickell Street which also has only 2 hrs storage at 4 x average dry weather flow. Studies had indicated that an additional storage volume of 355 m³ is required at the Massey pump station to meet the 4 hour design standard. Unfortunately, there is insufficient space available to construct additional storage. The lack of storage at Massey pump station is mitigated by the presence of a standby generator unit that ensures continuous operation of the pump station in the event of power failure. With respect to Jickell Street, there was again insufficient space available to construct the required storage. This has also been mitigated by the installation of a new standby generator for instances of power failure. The performance of the pump stations is monitored by telemetry that enables total running hours and other performance indicators to be identified for each pump. This is tracked to detect any deterioration of pump performance. In the past three years there have been several overflows at the Reserve Rd Longburn pump station. In order to improve understanding of flows in the pump station catchments upgrades to provide flow measurement as well as more robust electrical control and telemetry are proposed for a number of stations across the network, 6.5 Wastewater Treatment Assets Wastewater Treatment Asset Attributes Palmerston North City Totara Road Wastewater Treatment Plant The original conventional primary treatment plant at Totara Road was officially opened on 22 June The secondary treatment facility (aerated lagoons) were designed and constructed during the early 1980 s, and commissioned in Tertiary treatment facilities were added in and included UV irradiation treatment, and a dissolved phosphorus removal plant including clarifier and an associated sludge dewatering plant. To meet cultural objectives, the treated effluent passes through a constructed wetland pond and rock embankments before discharging into the Manawatū River. 64

81 Section 6 Assets & Lifecycle Management Figure 24: Totara Road Wastewater Treatment Plant Schematic The sludge generated in the primary treatment plant is stabilised through two anaerobic digesters. The anaerobic digesters were upgraded in 2009/10 to enable increased organic loading and increased biogas production. Ashhurst Consists of a two stage oxidation pond system with mechanical aeration in the first pond, sited near the bank of the Manawatū River on farmland off the end of Hackett s Road, and serves a population of approximately 2,634. The first stage pond has a capacity of 19,000 m 3 and the second stage pond 7,100 m 3. A 4 kw aerator was installed in 1997 to improve the quality of the effluent discharging to the river. Following expiry of the consent to discharge to the river in August 2013, a connection from the Ashhurst system to the city was constructed in June This comprised a pump station drawing from pond two and 8.6km of rising main discharging to the terminal manhole in Rosalie Terrace. A temporary consent (3 yr expiring in December 2018) in place for the operation of the ponds, subject to the outcome of further investigation in the extent of leakage from the ponds into the surrounding groundwater. Monitoring of groundwater both upstream and downstream of the assumed zone of influence of ponds over the last 18 months has indicated little if any effect from the discharge. On the basis of the interim results Council is proposing to apply for a long term consent for the two pond system Wastewater Treatment Asset Condition Palmerston North City Totara Road Wastewater Treatment Plant Since the WWTP was commissioned in 1968, the plant has been maintained to a high standard, with an ongoing maintenance programme and replacement and upgrade of mechanical and electrical equipment on an as required basis. Historically this has been funded from an annual allocation of funds with final project selection occurring at the start of the budget year. This is being replaced by a more robust 5 year renewals programme informed by condition assessment of all key mechanical and electrical assets. The renewal profile developed will then be used to inform the application for funding. 65

82 Section 6 Assets & Lifecycle Management Elements of the inlet works have previously been investigated to assess performance. The evaluation concluded that the inlet screens were under capacity and had poor performance. In addition, the capacity of the inlet lift pumps will be exceeded by 2022 and will require replacement. The final part of the study investigated the performance of the existing primary sedimentation tanks, and concluded that capacity would be increasingly exceeded as flows increase. The study recommended duplication of the sedimentation tanks in order to treat the projected future inlet flows and loads, and replacement of the pre aeration/grit removal system. The above investigations are set out in detail in the report Totara Road WWTP Inlet Works and Primary Treatment Capacity, Capacity Review of Inlet Works and Primary Treatment (Harrison Grierson, June 2014). 7 To date the inlet screens and screen conveyor systems are in the process of being replaced, and a new odour control system has been installed. The new screens consist of 3 x 5mm band screens that run continuously and duplicate nog wash screen conveyors. The replacement of the pre aeration/grit removal system is also underway, and work on identifying suitable inlet pump replacements has started. The duplication of the primary sedimentation tanks is currently on hold pending the outcome of the upcoming Wastewater Best Practicable Options Assessment (BPO) review. Previous inspections had revealed that the internal spaces of the floating lids on the two anaerobic digesters were in poor condition. As a result of this, both lids are being repaired, and corroded structural steel replaced over two successive years. Associated equipment is also being replaced, including gas pipework, valves, and pressure relief valves. The internal concrete surfaces are being coated with protective linings. Ashhurst The oxidation ponds are in good condition and require little attention, apart from routine maintenance on the mechanical aerator. Some deterioration of the wave band around the ponds has occurred and will require attention in the medium term but it is intended this will be addressed as part of the annual operating programme if required. Table 17 summarises the wastewater treatment plant assets. Table 17: Wastewater Treatment Plant Asset Data Component Description & Purpose Totara Road Wastewater Treatment Plant Condition Grading Performance Sluice Gate Screening Lift Pumps Pre Aeration and Grit Removal Tank Sedimentation Tanks Sludge Digesters A hydraulically operated penstock gate controls the incoming flow automatically so as to limit flow to that which can be handled by the plant. Three 5mm band screens and two Nog Wash screen conveyors. Recycled wash water system to keep the screens clean. Four 75KW AC variable speed driven pumps lift all the flow to a suitable level for gravity flow though the treatment processes. This tank is for the deposition of grit before the flow passes to the sedimentation tanks. Three sedimentation tanks allow the solids to sink to the bottom for sludge removal and fat and grease to accumulate on the surface from where it is skimmed off. Two anaerobic sludge digesters stabilise the sludge for disposal to the sludge lagoons Harrison Grierson, Totara Road WWTP Inlet Works and Primary Treatment Capacity, Capacity Review of Inlet Works and Primary Treatment, June 2014 DM#

83 Section 6 Assets & Lifecycle Management Component Sludge Lagoons Aerated Lagoons Aerators Monitoring Standby Generator(s) UV Plant Phosphorus Reduction Plant Wetland Pond Description & Purpose For the accumulation of the digested sludge and further breakdown of the sludge hectares total area. Two lagoons covering a total area of 3.8 ha are connected in series provide for secondary treatment of the effluent. The first pond utilises four 30 kw floating aerators and two 45 kw floating aerators and the second pond three 30 kw aerators all fitted with variable speed drives to assist with the oxidation process. SCADA via Wonderware Archestra and Abby Systems Powerlink telemetry. A diesel powered standby 500 KVA generator commissioned in 2013 is installed to provide power for the main building including lift pumps in the event of power failure. A separate 300 KVA diesel powered generator has been installed to power the UV treatment plant and Phosphorus Removal Plant, the lagoon aerators are not supplied with standby power. Installed and commissioned in 2003 consists of two banks of LP UV lamps 112 kw. A single 48m diameter clarifier has been installed in association with a sludge dewatering plant in Constructed in 2003 in conjunction with the UV plant by converting a sludge stabilisation pond. Condition Grading Performance Biogas Generator Commissioned in kw dual fuelled generator. 1 1 Digester Sludge Thickener Digested Sludge Thickener Clarifier Sludge Thickener Liquid Waste Reception facilities Ashhurst Oxidation ponds Andritz rotating drum sludge thickener commissioned in 2012 with associated automated poly batching plant and pumps. 1 1 Teknofaghi Mono Belt Thickener commissioned in Westphaila Centrifuge. 1 1 Two 30,000L tanks and associated pumps for receiving additional liquid wastes before injection into the digesters commissioned in A two stage oxidation pond system using natural biological process to treat Ashhurst wastewater Aerator A mechanical device operated to assist aeration in the first pond. 2 2 Condition grading confidence level descriptions are provided in Appendix G Wastewater Treatment Asset Capacity and Performance Palmerston North City Totara Road Waste Water Treatment Plant The wastewater treatment plant treats wastewater collected from a population of 73,662. The average dry weather flow is 27,487 m 3 /day. Flow can increase substantially after rain to as much as 120,000 m 3 /day due to stormwater inflow and infiltration into the collection system. Work was undertaken in recent years to increase the capacity of the plant to provide for a population equivalent of 100,000 or 42,000 m 3 /day dry weather flow. This includes primary settlement tanks bypass channel construction, and improvements that allow for flows to pass directly to the aerated lagoons without primary treatment (1997 and 2005). Upgrades to inlet pumping capacity were completed in 2005 along with improved capacity for flow between the aerated lagoons. The new tertiary treatment works have been designed to meet capacity needs of 100,000 population equivalent. 67

84 Section 6 Assets & Lifecycle Management In recent years, the organic load to the plant has increased, particularly from a number of wet industries in Palmerston North and the Longburn Industrial Area. A further increase in flows has occurred following installation of pumped connections from the satellite towns of Ashhurst, Longburn, and Bunnythorpe. This led to the capacity assessment of the inlet works and primary treatment by Harrison Grierson (June 2014), as discussed in Section Primary Treatment Processes With the projected increase in flows and loads, the capacity of the existing primary plant is constrained. The situation is likely to be exacerbated due to further growth in the future. Moreover, the plant and equipment in the primary treatment plant have been in service for more than 20 years in some cases, and the technology is out dated. As a result, performance had been compromised, with frequent break downs requiring high maintenance. Some of the key issues were as below: Inlet Screens Capacity constrained at current flows, low solids capture rate, and odour issues. Lift Pumps No redundancy in the system at current wet weather flows, insufficient capacity to cater for the future flows, Worthington Simpson Pumps which are no longer manufactured. Grit Removal System Insufficient capacity to cater for the future flows and odour issues. Primary Sedimentation Tanks Capacity constrained at current flows and unsafe concrete structure. Based on a multi criteria analysis, the Harrison Grierson report recommended the following: Upgrade screens with two 3m Rotary Screens of 1,200 L/s each; Increase pumping capacity with new pumps; and Modify the existing aerated grit chamber to accommodate a PISTA Grit Removal System of 2,468 L/s capacity for projected flows up to 2043, and upgrade PST with the addition of two channels to cater for flows up to To date, the inlet screens and screen conveyor have been replaced with 3 x 5 mm band screens rather than 2 rotary screens as originally proposed, and with 2 nog wash screen conveyors. At the same time, permanent odour control has been installed. The replacement for the existing aeration/grit removal system has been ordered with installation expected during the summer of 2018/19. Secondary Treatment Process After investigations into the performance of the aerated lagoons regarding their performance, an additional two floating aerators were installed into pond one, and the existing aerators relocated. At the same time, additional dissolved oxygen (DO) monitors were installed. This has addressed the shortfall in aeration capacity in pond one and here is now a surplus of aeration capacity in pond two to cater for predicted domestic and commercial growth over the period prior to the upgrade the wastewater treatment plant. For further details refer to the report Palmerston North City Council, Totara Road WWTP Aeration, Design Report: Relocation of Aerators GHD Consultants, August 2014). 8 8 GHD, Palmerston North City Council, Totara Road WWTP Aeration, Design Report: Relocation of Aerators, August 2014 DM#

85 Section 6 Assets & Lifecycle Management Consent Review Following on from a non-compliance and abatement notice issued by Horizons Regional Council in 2011, a formal Consent Review of the treatment plant discharge was heard in front of four commissioners in November The formal Consent Review was withdrawn by Horizons Regional Council before a decision was recorded, after PNCC agreed to apply for a new discharge consent by 2022 rather than in The revised consent conditions include a requirement that PNCC undertaking a Best Practicable Options assessment of treatment options before applying for the new discharge consent. The revised consent also includes a number of mandated milestones the Council has to achieve and report on. The revised consent is located in Appendix C. The discharge from Totara Road is covered by RC No and a copy of the consent is located in Appendix C. Ashhurst The Ashhurst ponds were upgraded in 1997, with the addition of a 4 kw aerator to satisfy previous discharge consent requirements. Following expiry of the discharge consent in 2013, a new pumped connection to the Palmerston North network was constructed and commissioned. A temporary three year consent (expiring December 2018) consents the current pond, to allow for intensive ground water monitoring to be undertaken to determine the effects of any leakage from the ponds to the surrounding soils and groundwater. Monitoring to date indicates minimal to no significant leakage to the surrounding soil and so Council proposes to apply for long term consent for the facility. Depending on the outcome of the consent, there is a possibility that the regional council may require the ponds to lining, however at the time of writing this AMP no allowance has been made to fund any works. Bunnythorpe Wastewater from Bunnythorpe is now pumped to Palmerston North for treatment. The oxidation pond and pump station that previously supported the pumping of wastewater to Feilding have or are in the process of being decommissioned. Longburn Wastewater from Longburn is pumped to Palmerston North for treatment via the 300 mm diameter rising main originating in the Works Rd industrial area The Telemetry and SCADA Assets Description of Assets In order to collate and store operational data, Council utilises a telemetry service to transmit monitoring data from various sites, typically pump stations throughout the City, to a central database. Council currently uses Abbey Telemetry System. Data is available in real time to operational and City Networks staff to monitor the operations of both the pump stations and the treatment plant. Historical data is also available to analyse trends and patterns. Data from the sites is transmitted using radio communications. The data monitored includes operational status of the pumps, such as pump run hours, flow rates, well levels, etc. The telemetry system also transmits alarm paging messages to pump maintenance crews whenever it detects faults in pump operations, such as power failure, pump fault, high well level, etc, so that the fault can be 69

86 Section 6 Assets & Lifecycle Management attended to in a timely manner. Communication with the Telemetry Master Station is by Abbey Secure-Link software using laptops and broadband internet connections. The Totara Road WWTP uses Wonderware Archestra as the (System Control and Data Acquisition) SCADA system. This monitors, controls, and optimises the various equipment and processes at the plant. The Archestra SCADA software was purchased and installed in This includes a Historian back-up server that is located at the Main Council Building. The Historian records all data collected from the WWTP, and is available for reporting purposes. The SCADA system also has its own independent alarm paging systems to notify treatment plant operators and supervisors of faults, etc. The Totara Road WWTP can be monitored and managed remotely, as the SCADA system can be accessed via the Council network. A Disaster Resilience Study & Options Report was completed for PNCC water and waste telemetry system in The recommended improvements are: Replacement of aging remote telemetry units. Additional Land Mobile Radio (LMR) Channel to reduce traffic loading from the increasing number of telemetered sites. Setting up of Telemetry Disaster Recovery Master (DRM) at the Arena and the North Range Road Repeater Site, supported by: High speed Ethernet via two microwave links between North Range Rd Repeater Site with CAB & Arena. Resilience improvements to North Range Road Telemetry Repeater Site. 6.6 Activity Management Support Services Activity management has no direct effect on asset condition, but provides those functions required to support the maintenance, renewal, and development plans. These functions include: System planning. System monitoring. Systems record management. Policy and strategy development. Effluent quality control. Bylaw development. Regulatory control of stormwater inflow. Resource consents. Public education programmes. Internal staff resources are mainly utilised in carrying out the functions as outlined above. Specialist external resources are employed for CCTV inspection of pipelines, strategic wastewater flow monitoring, and more sophisticated technical investigations and legal advice. Trade waste investigation and administration is performed by the City Enterprises business unit of the Council. The support services programme, planning, and policy expenditure forecast for the next five years to implement the strategies above is shown in Table

87 Section 6 Assets & Lifecycle Management Table 18: Activity Management Program Five Year Forecast Activity 2018/ / / / / /24 City Networks Labour and Overheads $614,525 $936,557 $938,953 $930,648 $930,672 $930,672 Consumables $500,000 $400,000 $400,000 $400,000 $400,000 $400,000 Electricity $364,850 $210,000 $210,000 $210,000 $210,000 $210,000 Insurance $186,180 $191,100 $191,100 $191,100 $191,100 $191,100 Consultancy $220,935 $163,000 $163,000 $163,000 $163,000 $153,000 Rates $76,577 $78,660 $78,810 $78,960 $79,110 $79,110 Miscellaneous $60,057 $61,000 $61,000 $61,000 $61,000 $61,000 Gas $75,000 $30,000 $30,000 $30,000 $30,000 $30,000 Legal $5,942 $5,000 $5,000 $5,000 $5,000 $5,000 Reactive Maintenance $5,214 $5,000 $5,000 $5,000 $5,000 $5,000 Plant Repairs and Maintenance - $10,000 $10,000 $10,000 $10,000 $10,000 Software Licenses $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 Activity Management $2,114,280 $2,095,317 $2,097,863 $2,089,708 $2,089,882 $2,079, Increases in Services (Operating Programmes) Programme 1319 Totara Road Wastewater Treatment Plant Consent Renewal Upgrade Options Analysis This programme which is a multi-year programme continuing from is provided to fund the completion of the optioneering stage of identified the preferred option for an upgraded wastewater treatment and disposal facility. The Best Practicable Options Project (BPO) is scoped to assess all possible options for a future wastewater treatment facility, through effective consultation and engagement with the community and all stakeholders prior to Council confirming their preferred option by June This will enable an application for the necessary consents to be prepared for lodging by June Programme 1401 City Wide Infiltration and Inflow Investigations This programme is to fund a focussed programme to identify and address major sources of stormwater infiltration and inflow from both private properties and public spaces to the wastewater network. It has been some time since Council focussed efforts in this area and wet weather flows in the network have increased significantly. The programme is intended to identify the scope and extent of what might be achieved in the run up to applying for new consents for the wastewater treatment plant. It is intended to fund investigation as well as follow-up in catchments with significant inflow and infiltration but also use behaviour change approaches to engage the community in helping to address the issue. Table 19: Operating Programmes Forecast Expenditure Operating Programme 2019/ / / / / / Totara Road Wastewater Treatment Plant - Consent Renewal Upgrade Options Analysis $740,000 $740,000 $990,000 $990,000 $740,000 $740, City Wide Infiltration & Inflow Investigations $200,000 $200,000 $200,000 $200,000 $200,000 $200,000 Total $940,000 $940,000 $1,190,000 $1,190,000 $940,000 $940,000 71

88 Section 6 Assets & Lifecycle Management Asset Systems Database Infor Public Sector Council uses an asset management system order to store, collate and analyse asset data. The current Council system is Infor Public Sector (IPS), a product which is supplied by INFOR Global Solutions. The Council has used IPS (formerly Hansen) since The current version deployed is IPS IPS is based on internet technology and is Web-browser-based. managers to best reflect AM processes and terminology. It can be customised by asset The system is directly linked to the Council s Geographic Information System (GIS) via the Geo Administrator, an INFOR Global Solutions developed interface. The interface allows new assets to be created in GIS and added to the IPS asset register with a single key stroke. Assets can be selected in GIS and viewed in the IPS window. The link between IPS and GIS allows assets to be viewed in Geo City, an intranet viewer of Council s spatial data, which is available to all staff. Council assets can also be viewed through the Geo-Guide on the Council s public website. Local Contractors are able to use this service to locate Council assets prior to construction activities. IPS comprises of a number of modules: Asset Register. Work Orders. Inspections. Valuations. Images. A Date Exchange Utility (DEU) allows pipe inspection data to be exported from IPS to contractors, and results imported back into IPS. IPS allows asset managers to produce outputs using the Ad Hoc Reporting function. More complex reports are produced using Crystal Reports. IPS records the following asset data: Information: ID, Type, Description. Location: Address, Location Description, Area, Sub Area, District. Structural: Diameter, Material, Length, Manufacturer, Critical Rating. Associated: Install Year, Service Status, Ownership, Drawing No. Asset data can be assigned a condition rating and a performance rating base on a grading of 1 to 5 (see Appendix G). The ratings, along with criticality ratings, can be used to analyse the asset data and provide renewal profiles and determine maintenance programmes. Asset maintenance, both planned and reactive on assets, along with inspections, is recorded in IPS. Associated costs can also be recorded in the Work Orders module. Recent work has now provided a mobile platform for undertaking and recording asset maintenance, which utilises off the shelf tablets and proprietary software supplied by IPS. Work Orders can be processed Live in the field using the Infor Field Inspector. 72

89 Section 6 Assets & Lifecycle Management Figure 25: Field Inspector Screen Shot Assets recorded in the Asset Management System (AMS) have been assigned a replacement value, which is used for insurance purposes, and will be used to estimate renewals programme costs when the condition, performance, and criticality ratings are complete. Figure 26: IPS Screen Shot Overall, the quality and extent of data held in IPS is considered to be good. Pipeline data is quite extensive, with the exception of wastewater laterals (service lines). Pump station and treatment plant 73

90 Section 6 Assets & Lifecycle Management component data records have been improved over the past three years and is now considered to be good. Table 20 details the extent of the asset data currently held in IPS for the wastewater activity. Table 20: IPS Data Accuracy & Completeness Asset Type Sub- Type No of Assets Recorded Reticulation Completeness Asset Register Accuracy Valuation Mains % 95% 100% Manholes % 95% 100% Service Lines % 90% 100% Valves % 95% 100% Pump Stations Equipment % 95% 100% Treatment Plant Equipment % 90% 100% Oxidation Ponds Equipment 31 95% 95% 100% Network Hydraulic Modelling Council utilises a computer based hydraulic model to analyse the wastewater network. The model is used to assist in: Analysis of the capacity of the system to accommodate additional wastewater connections, from a single connection to a multi lot sub-division. Optimisation of the network to improve operational efficiency. Assessing the effects of inflow and infiltration on the wastewater network. Identifying opportunities to improve network layout prompted by the need for wastewater pipe renewals. Identifying requirements for pipe upgrades to cater for population growth and new large developments. Council uses Mike Urban modelling software, provided by the Danish Hydraulic Institute (DHI). This is a strategic model of the entire Palmerston North Urban wastewater network, and had been calibrated for dry weather and wet weather flows using data collected from a city wide flow monitoring programme undertaken over a number of years. The system was previously limited to the trunk main network. More detailed sub-catchment models have been, although they are yet to be calibrated. The network model has utilised data from a series of flow monitors located at critical locations within the network. An intensive period of flow monitoring for model calibration purposes was undertaken in 2015, with up to 9 temporary flow monitors installed throughout the network to collect flow data. External consultants were engaged to assist in the model development and calibration work over a period of two years. Additional work was completed to assist in calibrating the model, including surveys of missing manhole inverts and pipe diameters. PNCC now has a fully calibrated wastewater network model that will assist investigations into capacity constraints for current and future flows to inform network renewal and capital upgrade decisions. 74

91 Section 6 Assets & Lifecycle Management 6.7 Water Services Assessment Water Services Assessments, as required by section 125 of the Local Government, were last completed by Maunsells Ltd in Summaries of the assessments were included in the Year Plan. In the case of wastewater services, the assessments identified that the wastewater services within Palmerston North are adequate to meet public health outcomes and mitigate environmental effects and have sufficient capacity to cater for current demands. The programmes and projects described in this AMP are consistent with the issues and risks previously identified in the 2005 Water Services Assessments. There are no significant variations to disclose. 6.8 Operation & Maintenance of Assets Overview The overall goal of operations and maintenance is to ensure that assets will operate as designed and continue to do so reliably when required. With wastewater assets this is particularly important give the public health and environmental impacts of assets which fail, as well as the significantly higher costs associated with undertaking emergency repair to assets that fail. In respect of treatment plant and pump station assets a low risk tolerance threshold is accepted with a focus on pro-active maintenance of all critical components. The provision of duty and stand-by equipment particularly for pumping and monitoring is key to provide an opportunity for repair without loss of service. With network assets a low risk approach to trunk main assets is taken again because of the high consequence of failure. For less critical assets e.g. property laterals the optimum approach is a balance of both reactive and proactive maintenance. While low levels of reactive maintenance are normally the ideal, high levels indicate inadequate proactive maintenance or significant deferred renewal obligations, both of which are considered undesirable Operation & Maintenance Strategies The pro-active maintenance programme for the treatment plant, pump station and network assets has been developed from operator and staff experience as well as manufacturers and supplier recommendations. It comprises a range of routine tasks involving cleaning and flushing of problem network assets to prevent blockage, coupled with regular inspection and cleaning of critical above ground assets such as aerators, motors, pumps and controllers as well as pump station mechanical and electrical assets. Further development of the scheduled maintenance is planned to ensure condition information required to inform renewal programmes is captured. Critical to effective maintenance of the wastewater network is completion of regular CCTV inspections by CCTV and condition scoring to more robustly confirm the timing and urgency of renewal of the network. The expectation is that the older smaller diameter part of the network will exhibit the poorest condition. Reactive maintenance includes a wide variety of work ranging from clearing of network blockages, repairs to broken and collapsed pipes, as well as pump, motor and electrical repairs in pump stations and at the treatment plant. A wide variety of mechanical and wearing components at the wastewater treatment plant can fail. 75

92 Section 6 Assets & Lifecycle Management Operation & Maintenance Costs Wastewater activity operation and maintenance costs are grouped into three areas namely activity management, activity delivery and a range of special operating programmes with specific outcome objectives. Additional charges in the operation and maintenance area include interest and depreciation. Table 21 depicts the current breakdown of operations and maintenance expenditure within these three areas for the first five years of the plan. Table 21: Operations & Maintenance Forecast Expenditure (Next Five Years) Wastewater Activity 2018/ / / / /23 Activity Delivery $2,725,000 $2,799,000 $2,783,000 $2,827,000 $2,827,000 Activity Management $2,095,000 $2,098,000 $2,090,000 $2,090,000 $2, Operating Programmes $940,000 $940,000 $1,190,000 $1,190,000 $940,000 Total (excl interest and depreciation) $5,760,000 $5,837,000 $6,063,000 $6,107,000 $5,847, Operation of Wastewater Assets The wastewater activity is primarily managed and operated to meet agreed levels of service as set out in section 4 by achieving the following: Maintain the quality of the service to protect the health of the community. Ensure the service is accessible to the community within the service area. Ensure the service is reliable with minimal service disruptions. Ensure the activity is operated safely to minimise the risks to the public and operational staff. Operate to maximise the sustainability of the activity. Operate to minimise the overall cost of the activity. Other factors that directly influence the operation of the wastewater activity include: Meeting the requirements specified in Council strategies and specific management plans. Compliance with Horizons Regional Council discharge consent permits. Compliance with national legislation with regard to health and safety and hazardous chemicals. The day to day operation of the wastewater activity is carried out in accordance with a number of internal Service Level Agreements (SLA s) covering the operation and maintenance of the treatment plant, wastewater pump stations, and collection network. All work undertaken on the treatment plant and wastewater network is done in accordance with PNCC s Health & Safety Manual and the site specific Treatment Plant Health & Safety Manual. To ensure that levels of service and regulation requirements are met, Council carries out extensive monitoring of the wastewater network, pump stations, and treatment plant. Council utilises data automatically collected from flow meters and equipment sensors at all critical wastewater assets, which enables operators to respond immediately to equipment failures or network issues. Council also monitors WWTP equipment and effluent data to ensure reliable on-going operation of the treatment plant. In addition to automated monitoring, operational staff also carry out manual monitoring in the form of visual inspections and manual recording of data. In order to achieve regulatory compliance, Council is required to take regular samples of the wastewater effluent. Sample results are analysed by an accredited laboratory and are used as appropriate to alter operational settings for efficient operation of the treatment plant. 76

93 Section 6 Assets & Lifecycle Management Council has prepared Business Continuity Plans (BCP) that outlined response and management strategies when key assets or personnel are unavailable. Council is currently completing a review of the BCP plans and developing revised plans. These will set out specific actions required to cope with a 5 day event which impacts on Council and identifies how core services will continue to be provided. Council maintains a suitable level of preparedness for prompt and effective response to disruption events and civil emergencies through suitably trained staff and robust operating procedures Maintenance of Wastewater Assets The wastewater assets maintenance strategy is intended to maintain the current level of service while minimising costs. Day-to day-maintenance activities are carried out to achieve the following: Maintain operational functionality of the asset. Prevent premature deterioration of the asset. Council s maintenance strategy is broadly based on the criticality of the assets: Assets rated as High Criticality are inspected frequently. A high level of preventative maintenance is carried out, and component renewals are triggered, based on the condition of the asset. Assets rated as Medium or Low Criticality are inspected less frequently. Preventative maintenance and component renewals are predominantly scheduled on a time basis. Assets rated as non-critical are rarely inspected and a run to failure approach is taken. Assets are repaired or replaced when required Operation & Maintenance Delivery Delivery of the operation and maintenance services for the wastewater assets is carried out by City Enterprises, the operational unit of Council, under contract to City Networks (the asset owner) through a series of internal contracts (known as Service Level Agreements or SLAs). For the wastewater activity there are seven SLA s in place which cover both operation and planned maintenance tasks and these are summarised in Table 22. These SLAs run annually and are occasionally supplemented by additional SLAs for specific operational or maintenance tasks. In addition to the internal agreements there are also a number of externally contracted organisations engaged to complete specialist maintenance activities including pump station electrical maintenance, maintenance of the biogas engine and calibration and maintenance of various meters, monitors and testing equipment. In respect of the SLAs work is on-going to shift from lump sum agreements to measure and value agreements still with fixed prices for deliverables but with an enhanced focus on outcomes and outputs reported on monthly. The current level of expenditure on operation and maintenance delivery is outlined in Table 21. Table 22: Operations & Maintenance Activity Delivery Expenditure Five Year Forecast Activity 2018/ / / / / /24 Service Level Agreements $2,400,000 $2,449,000 $2,433,000 $2,477,000 $2,477,000 $2,477,000 External Contracts $325,000 $350,000 $350,000 $350,000 $350,000 $350,000 Total $2,725,000 $2,799,000 $2,783,000 $2,827,000 $2,827,000 $2,827,000 Wastewater Collection Network Maintenance Programme Work carried out under the wastewater network SLAs involves a mix of scheduled maintenance tasks including inspection and flushing as well as responding to faults that develop in the system including 77

94 Section 6 Assets & Lifecycle Management blockages, breaks, overflows and odour incidents. Table 21 summarises the anticipated budget cost required over the next five years to ensure delivery of the defined levels of service. Planned maintenance expenditure includes scheduled flushing, root kill, and inspections. To control the level of stormwater inflow and infiltration into the network, there is an ongoing programme of property drainage inspection in conjunction with smoke-testing of sewer mains. Unplanned maintenance includes clearing of blockages, reactive inspections and repairs to mains, laterals, and manholes. There has been a gradual increase in lateral repairs over the past 3 years, due to a combination of street tree damage and third party damage, primarily resulting from the fibre roll out in the city. The 30 year financial forecast for the collection network is shown in Appendix E. Pump Stations Maintenance Programme Work carried out under the pump station maintenance SLA mainly consists of regular inspections, including electrical inspections, well cleaning, and also includes the provision for a 24 hour call out service and receiving and logging of enquiries, complaints, and problems in line with City Networks levels of service requirements. The SLA requires immediate response to pollution overflows and pump station failure, 1 hour response time for high level alarms, and 24 hours for non-urgent complaints. Table 22 above shows anticipated operational costs over the next 5 years to ensure delivery of the defined levels of service. The work needs are consistent with the strategies defined above. Treatment Facilities Maintenance Programme Maintenance work at the Totara Road treatment plant includes checking, operation, and maintenance of plant and machinery, setting of gates and controls, sampling of effluent, cleaning, disposal of digested sludge, and operation of the phosphorus removal plant, sludge dewatering plant, sludge booster, liquid waste reception facilities, UV plant, wetland ponds, grounds, and building maintenance. The oxidation ponds at Ashhurst generally require only weekly inspection. Additional expenses for Ashhurst pond include access track maintenance and running costs for the mechanical aerator. Table 22 above details anticipated operational costs over the next 5 years to ensure delivery of the defined levels of service. Biogas Generator Maintenance The maintenance of the biogas generator located at the treatment plant is contracted out to the original supplier of the generator. The generator is remotely monitored from Australia and there is a local contractor who undertakes minor maintenance and inspections. Major maintenance is undertaken by specialised staff from Australia. PNCC treatment staff also monitor the performance of the generator on site and make the day to day decisions on running times and output Delivery of Programme Operation and maintenance of the wastewater assets is carried out by City Enterprises; the operational unit of Council under specific service level agreements (SLAs). There are seven SLAs in place to cover annual operation and planned maintenance tasks for all the wastewater assets. Table 23 details the these SLAs and their value as agreed in the year. Additional SLAs may be required during the year for one off investigations and are provided for as part of forecast expenditure in Table 23. The SLAs are reviewed and agreed annually. 78

95 Section 6 Assets & Lifecycle Management Table 23: Current Operation and Maintenance SLA Costs (2017/18) SLA Ref Description Annual SLA Value ( ) 5 Totara Road WWTP $1,233,000 6 Ashhurst Pond and Pump Station $29,000 8 Linton Pond Pump Station $ Wastewater Pump Stations $220, Wastewater Reticulation Maintenance $425, Minor Wastewater Reticulation Works $55, Cogen No. 2 (Totara Road WWTP) $200, Trade Waste Management $153,000 Total $2,318,000 To operate the wastewater activity City Enterprises employs 7.5 FTE (full time equivalent) staff to operate the pump station and treatment plant. This is supplemented by 6 FTE staff to carry out wastewater maintenance. The organisational structure of the City Enterprises team is shown in Figure 27. Treatment Plant Manager (0.5 FTE) Senior WWTP Technician (1 FTE) Maintenance Fitter (0.5 FTE) Trade-waste Officer (1 FTE) Treatment Plant Project Manager (0.5 FTE) WWTP Operators (4 FTE) Figure 27: Wastewater Treatment Operations & Maintenance Staff Operations staff are contracted to provide wastewater services on a 24 hours a day, 365 days a year basis, including customer response (Request for Services), and an emergency response capability. All City Enterprises staff receives an appropriate level of training, including specific Health & safety training and specialised equipment training. For the WWTP staff are trained to a minimum of NZQA level 4 in Wastewater Treatment Plants. 6.9 Renewal of Assets Overview Asset renewal is major work which restores, rehabilitates, replaces, or renews an existing asset to extend its economic life and/or restore its service potential. Work over and above restoring an asset to its original capacity is classed as development work. Renewals may be carried out for two primary reasons: Maintain the asset service potential this may be either the quality of service or reliability of service. 79

96 Section 6 Assets & Lifecycle Management Minimise the whole life cycle cost of the asset. The decision to renew an asset will be based on: Criticality (consequence of failure); Condition (and therefore remaining useful life); Performance; and Value. There are two options for a renewal project: Rehabilitate or refurbish the asset; or Replace the asset like for like. Renewal literature often refers to renewals options to upgrade/downgrade or alter the asset to meet other service requirements. For the purpose of this AMP, this is considered development work Renewal Strategies Renewal decisions are made based on criticality, condition, and asset performance. Critical assets should not be allowed to fail, and programmes need to be organized to replace or renew critical asset prior to the expected failure date. Typically assets maintain performance for most of their lifecycle and deteriorate quickly towards the end of their useful life. Renewal of assets must be carefully considered, as early replacement leaves unused value in the ground, while delayed replacement causes loss of service and costly repairs. Overall performance of the network is carefully monitored to identify areas where renewals are required. Renewals can also be brought forward or delayed in some cases to co-ordinate with the road renewals program. A Wastewater Pipe Renewal Strategy has been developed to help determine the specific location and timing of pipe renewals moving forward. The strategy has formalised the I&I reduction focus discussed in this document. This document is reviewed annually and progress assessed against targets Long Term Renewal Profile The expected lives used for calculating the replacement year is shown in Table 24. Table 24: Life Expectancy of Wastewater Assets Asset Type Wastewater Assets Wastewater Pipes Standard Manhole Expected Asset Life Wastewater Pump Stations Civil Structures Pipework Mechanical plant e.g. pumps Electrical Equipment

97 Section 6 Assets & Lifecycle Management Asset Type Wastewater Treatment Plants Buildings and civil works Electrical Mechanical Pipework Electronic equipment Expected Asset Life These asset lives have been determined through standard asset lives as set out in the II manual Asset Valuation Guidelines and from our own inspection and condition records. Figure 28 shows the 50 year renewal profile for the wastewater pipes based on the expected asset life. The renewal profile is based on age and expected asset life, which was reviewed by AECOM as part of the 30 June 2017 re-valuation. It does not currently account for actual asset condition and performance. $ Valuation Pipes Exceded Expected Life $4 $3 $2 $1 $ Replacement Value [$M] Figure 28: Wastewater Pipes Profile Based on Expected Asset Life Renewal Programme Council uses a combination of several methods to develop the renewals programme: Forward projection of historical costs combined with broad estimates of asset depreciation. Predictive modelling based on age. Bottom up or unconstrained work bank approaches based on available condition information and operator knowledge. The current wastewater renewals programme comprises the following on-going renewals programmes: Wastewater pipes. Wastewater pump stations. Wastewater Treatment Plant minor mechanical/electrical works. 81

98 Section 6 Assets & Lifecycle Management The value of these programmes has largely been based on historical cost in conjunction with age profiles. Major plant items are also included where known. At this point in time, the age of the pipeline asset has been used as an indicator of remaining useful life, but is otherwise not a significant factor in determining the renewals programme. The renewals programme will be substantially reviewed as a result of the current wastewater network modelling project. Further work will be undertaken to refine the renewal programme to take into account pipe criticality, vulnerability and resilience. These ongoing programs are supplemented by specific renewals projects for larger trunk mains. A series of renewals projects have been identified based on asset condition and performance, and targeted investigations. An on-going CCTV inspection contract has been awarded, in conjunction with a newly developed wastewater main inspection programme which is focused on the critical/larger pipelines in the network but also includes a selection of the smaller less critical pipes. The initial inspection programme is based on age, diameter and criticality. The outcome from these inspections will help define the renewal programme moving forward. Figure 29: Definition of inspection groups by age, diameter & criticality Table 25 summarises the proposed renewals program expenditure. Given the age of the Totara Road WWTP there are a significant numbers of plant renewals within the programme, given many of the structures on the site reach the end of their useful life in the coming AMP period. At this stage the renewal requirements for the WWTP will need to be confirmed as part of the planning and options assessment being completed under the wastewater BPO project. Asset renewal issues relating to each asset group are discussed below. 82

99 Programme 2018/ / / / / /24 Risk if Deferred 54-City-wide - Wastewater Pipe Renewal $1,600,00 $1,800,000 $2,000,000 $2,000,000 $2,000,000 $2,000,000 Failure to meet levels of service. Structural failure. 65-City-wide - Wastewater Pump Station Renewal $150,000 $125,000 $137,000 $85,000 $57,000 $40,000 Failure to meet levels of service Eastern Trunk main Hokowhitu campus $250,000 Failure to meet levels of service. Structural failure Bennett Street 525 Trunk main renewal $170,000 $170,000 Failure to meet levels of service. Structural failure Maxwell s Line 825 Trunk main Renewal $250,000 $250,000 Structural failure. 179-Totara Rd WWTP - Minor Equipment Renewals $130,000 $60,000 $100,000 $50,000 $50,000 $50,000 Failure to meet levels of service Totara Rd WWTP - Replacement of Grit $495,000 Poor level of service continues due to no reduction in Removal Systems 9 wear and tear in rest of plant 1068-Totara Rd WWTP - Replacement of Inlet environment $918,000 $780,000 Failure to meet levels of service. Pumps unable to Pumps 10 cope with inflows leading to overflows into the Table 25: Renewals Programme Expenditure Five Year Forecast Collection Network Collection Network Sub-Total $1,750,00 $2,425,000 $2,307,000 $2,255,000 $2,057,000 $2,290,000 Wastewater Treatment 1380-Totara Rd WWTP - Biogas Generator Major Overhauls $150,000 $300,000 Increased risk of significant engine failure 1067-Totara Rd WWTP - Replacement of Security Fence and Gate $250,000 Failure to meet levels of service. Wastewater Treatment Sub-Total $1,943,000 $60,000 $100,000 $830,000 $50,000 $350,000 TOTAL $3,693,000 $2,485,000 $2,407,000 $3,085,000 $2,107,000 $2,640,000 9 To be designed for growth which is estimated to be 20% increase in capacity. Renewal figures are 80% of total programme budget. 10 First two of four pumps. Remaining two pumps to be replaced in 2021/22.

100 Section 6 Assets & Lifecycle Management Wastewater Collection Network In the absence of comprehensive network condition assessment, the life cycle predictions were based on asset age and an average expected useful life of 120 years. This is no longer the case following a project undertaken to develop a forward renewal programme based on criticality, resilience, vulnerability and condition assessments amongst other factors. The renewal expenditure is forecast to rise to an average of $2.18 million per year over the next 5 years in order to maintain the service potential of the assets and to meet the higher levels of renewals that fall due during the period It is expected that a small percentage of pipes will come to the end of their useful life before their predicted life is reached, due to accelerated corrosion, unforeseen structural loading, or other causes. Likewise, some assets will last longer than their predicted life. The renewal programme is detailed further in the Wastewater Pipe Renewal Strategy 11 and has been refined as more condition assessment information became available from CCTV inspections. The risk associated with the deferral of the renewal works include: Increased maintenance costs. Unacceptable incidence of wastewater surcharges and overflows during storm events. To minimise the cost of asset ownership in line with the cost/affordability level of service, full life cycle costs and asset optimisation are considered when assessing options for renewal. The Wastewater Pipe Renewal Strategy recommends integrating pipeline renewal with I&I control efforts to optimise expenditure and minimise the risk. This is to be achieved by targeting renewal initially on older pipe networks in those catchments which have been identified as worst affected by I&I, and where the I&I reduction would provide system capacity most effectively. The targeted catchments are Tremaine Ferguson and College (refer Figure 21). A study has also been undertaken to assess the impacts of the expanded NEIZ on the downstream network (GHD Consultants, June 2014). 12 The recommendation of this study was that I&I reduction work should be undertaken in the Milson and Cloverlea catchments to assist in deferring capacity upgrades in the Western Trunk in order to accommodate additional flows from the NEIZ area. To date, no investigations have been undertaken in these catchments, but they will be included in future I&I works. Separately work to develop design guidance and a network design for a pressure sewer network to service the NEIZ has been commissioned in order to determine the actual flow capacity required. It is expected that the pressure sewer network will allow for deferral of the Western Trunk capacity upgrades. Indications are that the existing level of service provided is generally satisfactory, and there are no significant assets past the optimum renewal point in their life cycle. Renewal of a pipeline may be brought forward from its predicted useful life if it is considered that this will significantly contribute to reduction in I&I problems. When a major road or underground services upgrade or renewal is planned, the condition and performance of the wastewater network in the affected vicinity is investigated to determine whether its renewal is justified to offset reduced rehabilitation costs. One example of reprioritisation was the advancing of sewer renewal work in The Square (Fitzherbert to Main Street West). A five year plan of future network renewals has been included in the Wastewater Pipe Renewal Strategy, and this has been added to as further condition assessments have been undertaken. Condition assessment of recently CCTV inspected pipelines revealed that most pipelines are structurally sound. In many cases, the structural condition and performance grading of some pipes can 11 PNCC, Wastewater Pipe Renewal Strategy, July 2014 DM GHD, North East Industrial Zone Extension, Wastewater Capacity Assessment, June DM

101 Section 6 Assets & Lifecycle Management be greatly improved by renewing or rehabilitating a small section of problematic pipeline, rather than a complete replacement from manhole to manhole. This can be a very cost effective way to extend the useful life of a pipeline, and is adopted as one of the renewal strategies where appropriate. Renewal options include various pipe rehabilitation techniques or replacement with new pipe material, and the use of trenchless technology (pipe relining) where appropriate. Pump Stations Renewals have historically been forecast based on asset age, condition, and performance. For this AMP, site specific renewals out to 2048 have been forecast that include works such as major electrical equipment renewals, standby generators, and pumps. Based on the asset lives and historical trends, the long term pump station renewal expenditure averages $50,000 per annum with an increased rate of expenditure forecast in the first 3 years to address some legacy electrical and control system issues. It is considered that there are currently no deferred pump station renewals. Indications are that the existing level of service provided is generally satisfactory, although additional flow monitoring is now a priority to better understand high inflow catchments and pump stations at risk of overflow in wet weather events. There are no significant assets past the optimum renewal point in their life cycle. Treatment Facilities Identified renewal needs are based on end of asset life predictions, condition, performance, and life cycle cost estimates, and have been included as separate programmes where known. The life cycle predictions are based on historical information including asset age, performance, and condition. An additional consideration in developing renewal programmes is asset criticality and the consequence of asset failure in terms of consent compliance and public health. Based on known condition issues, assessed maximum asset lives and criticality assessments, a 5 year schedule of specific treatment plant has been developed, with budgets required varying between $60,000 and $130,000 depending on the scope of work required. This renewal profile drops away to $20,000 per annum based on the assumption that the majority of the treatment plant will be upgraded or replaced assuming the implementation of new consent requirements from 2023/24. During the past 3 years a number of major plant items have been or are being renewed or replaced. These include renewal of both digester lids, replacement of the inlet screens and inlet gate, and refurbishment of the existing sedimentation tanks. Indications are that the existing level of service provided is being maintained and there are no significant assets past the optimum renewal point in their life cycle Delivery of Programme The programme will be delivered by either Council s in-house resources, primarily for the wastewater pipe renewal programme, or by external contractors for more specialised works. The delivery method chosen will depend on the size and complexity of each individual programme. The Project Status reporting programme is used to track the progress of individual projects that make up the overall programme to ensure both the timeliness of delivery and costs. This system also enables delivery of reports to the monthly Works Programming meetings in which the progress of each project is reviewed. 85

102 Section 6 Assets & Lifecycle Management 6.10 Development of Assets Overview Development includes the creation or acquisition of a new asset that did not previously exist, or works which upgrade or improve an existing asset beyond its existing capacity. Development work may be necessary for the following reasons: Growth and increase in demand. Changes to Council policy and strategy. Changes to regulations and legislation. Changes to levels of service. Development of assets may also include disposal of an existing asset that is no longer required Development Strategies The development strategy is to provide for the progressive upgrading of assets to ensure future demand and changing service standards (i.e. resource consents) are achieved. The selection criteria for the prioritising and programming of development projects will be based on a consideration of risk and benefits, affordability, ranking with other expenditure, existing asset performance with respect to levels of service, and life cycle costs and efficiency. Proposed projects will be supported by an economic appraisal using cost/benefit analysis techniques which take into account: Capital costs; Any change in net annual operating costs; Any change in annual maintenance requirements; and Any salvage value of existing assets or components. All development projects require completion of a Programme Planning and Implementation Plan (PPI) to ensure that reasons for the project, options, costs and risks are considered. Significant projects will also require a Project Execution Plan (PXP) before proceeding. The design option chosen shall: Minimise the impact of urbanisation on water quality. Utilise the full capacity of existing infrastructure wherever practicable. Optimise life cycle costs for the assets created. The risk, costs, and benefits of accepting new privately funded assets constructed in association with property development will be reviewed, and a decision regarding approval will be made on a case-bycase basis by Council staff. When satisfactorily completed in accordance with approvals given, Council will accept such assets into public ownership. Council will not contribute to the cost of such works unless there are exceptional levels of service or equity issues. 86

103 Section 6 Assets & Lifecycle Management When considering disposal options, all relevant costs of disposal will be considered. These may include: Evaluation of options; Consultation/advertising; Obtaining resource consents; Professional services, including engineering, planning, legal, survey; Demolition/make safe costs; and Site clearing, decontamination, and beautification Development Programme The capital development programme is the upgrade of existing infrastructure or new works that are needed to ensure that the wastewater activity can meet the future needs of the City. The need to upgrade or provide new assets may be due to the following drivers: Increase the capacity of the assets due to growth in population of the City. This may be due to infill development or for a new sub-division or growth area. Upgrade assets to meet new regulatory or legislative requirements. This could include areas such as health and safety regulations, changes to resource consent conditions, or changes to national legislation such as National Policy Statements. Improvements to assets to meet changes in Council policy or strategies, and agreed changes to the level of service. Development work to cater for population growth may be funded directly by the developer, or may be provided by Council in advance of the development work occurring and then funded through subsequent development contributions. Development of the collection network over the past five years has largely been further extensions of the network into the current two urban growth areas of Kelvin Grove and towards Aokautere. The majority of these new assets were constructed by developers and then vested to the City Council as a result of new sub-divisional developments. Other major development works completed recently include: 2007/08 475mm trunk main construction in Railway Rd between Setters line and Roberts Line to support industrial growth. 2013/14 450mm upgrade of Western trunk between Railway Rd and McGregor Street. The above works were recommended in the 2001 Sewer Network Management Plan to provide the additional capacity to avoid sewage overflows in the vicinity during storm events. The future development programme expenditure is summarised in Table 26 below. Table 26: Development Programme Expenditure Project Growth % LOS % Expenditure Timing Collection Network Reticulation 73 Wastewater Subdivision Contributions $50-100k pa On-going 210 Urban Growth - Installation of Wastewater Systems for New Industrial Areas - NEI extension area $350k $350k

104 Section 6 Assets & Lifecycle Management Project Growth % LOS % 452Tremaine/Featherston - Wastewater Trunk Main Upgrade North East Industrial Zone - Downstream Wastewater Network Upgrade - McGregor Street to Rennie Avenue to Peters Avenue 660 Ferguson Street - Wastewater Trunk Main Upgrade Urban Growth - Whakarongo - Installation of Wastewater Systems Totara Road WWTP Inlet Main Duplication 1055 Urban Growth - City West - Installation of Wastewater Systems Expenditure $110K $300K $1.0M $1.9M Timing 2028/ / / / $670K 2025/26 $862K $267k $450k $1.2M / / /19 to 2019/ /20 to 2023/ Urban Growth Ashhurst WW Network Upgrade $260K 2019/20 Collection Network Pump Stations 1000 Urban Growth Whakarongo Installation of Wastewater Systems Wastewater Treatment 628 Consent Renewal Upgrade 1074 Earthquake Strengthening of Civil Structures $1.1M $110M $1.1M 2018/19 to 2022/ /24 to 2026/ /19 to 2019/ Totara Rd Emergency Bypass Upgrades $100k 2019/ Emergency Overflow Structure Totara Rd $150k 2020/21 Projects to Support Growth & Increase in Demand The following projects are attributed directly to growth as a result of new residential and industrial/commercial developments. Note that wastewater infrastructure to service the proposed growth areas will not proceed until the necessary land use zonings are in place, and investor commitments to the developments have been confirmed. Residential Rezoning The Residential Growth Strategy provides for growth through rezoning of the Whakaongo area followed by City West. Typically, the developer will fund and build the wastewater network within its development. However, the Council will need to extend its trunk network to service these developments, which will involve downstream trunk network upgrades and dealing with options for the treatment of their wastewater (refer programmes 624, 452, 1000 and 1055). Industrial Rezoning Further provision has been made in this AMP for extension of the NEIZ. It assumes development of approximately 120 ha of land in the vicinity of the existing industrial site. Development of the required utility and road infrastructure is assumed to take place over years three to seven of this AM planning period. It has been assumed and that there will not be any major wet industries for the new zone (refer programmes 210 and 624). 88

105 Section 6 Assets & Lifecycle Management Pump Stations Pump stations have been added to the system over the years, mainly to enable low lying areas of the City to be developed. The most recent additions have been the Coutts Way and Freedom Drive wastewater pump stations and these were fully funded by the developers. It is assumed that most new pump stations will be associated with sub-divisional development, and funded at no cost to Council. There will only be costs to Council if the City wishes to extend the capacity of a developer funded pump station at the time of construction to allow for the needs of an extended area. The exception to this is the proposed new pump station to be constructed on James Line, at the Napier Road intersection, to service the Whakarongo growth area. A proposed expenditure of $500,000 has been included in 2018/19 to enable construction. Collection Network The Wastewater Network Management Plan Review (2001) concluded that the lower sections of the Western, Tremaine, and Featherston Trunk Systems would require some capacity upgrades due to demand growth from developing upper catchment areas, such as Kelvin Grove and NEIZ. The timing of these upgrades has been modified in light of recent studies undertaken (GHD Consultants, June ), and in some cases, may even be able to be deferred. There are four separate lengths of trunk main identified for upgrade works as follows: Western trunk duplication of the 450 mm diameter main from the McGregor Street confluence to Rennie Avenue (length estimated at 1,630 metres); Western trunk duplication of the 525 mm diameter main downstream of Rennie Avenue to just beyond the end of Peters Avenue (length estimated at 3,290 metres); Tremaine Ave and Featherston Street upgrade; and And the Ferguson trunk upgrade in The Western trunk duplications can be deferred or possibly dropped altogether if the total flows out of the expanded NEIZ are limited to 20 m 3 /ha/day or less (GHD, June 2014). I&I reduction works in the Milson and Cloverlea catchments may also help defer upgrades. In addition it is proposed that the expanded NEIZ now be serviced through a pressure sewer system which would be expected to reduce flows from the zone further Various servicing scenarios were modelled for the proposed City West zone (GHD, June 2014), and a low pressure sewer (LPS) system was recommended for this growth area. The advantages of an LPS are twofold: It reduces the level of demand placed on the trunk network by smoothing out the flows and lowering peak flows from the area; and It is more resilient in high liquefaction zones, such as City West, as they avoid the need to lay wastewater pipes on grade. The PE pipe typically used in LPS systems is also better suited to resisting seismic movements. The ownership model adopted for any LPS or Vacuum Pressure System (VPS) will need to be approved by Council prior to designation of the area as a pressure sewer area. The preferred approach will be for Council ownership of the on property pump station and connecting pressure connection so 13 GHD, North East Industrial Zone Extension, Wastewater Capacity Assessment, June DM

106 Section 6 Assets & Lifecycle Management as to ensure approved equipment and installation and cost effective maintenance (refer programmes 452, 660 and 1043). Sub-Divisional Contributions A nominal amount of $100,000 per annum is budgeted for contribution towards building extra infrastructure capacity when a sub-divisional development first takes place to allow for future capacity requirement of subsequent development. This cost will be recovered from future developers by way of development contributions (refer programme 73). Totara Road WWTP Primary Treatment Duplication This programme has now been deferred and will be addressed through the WWTP BPO process. Projects to Support Changes to the Level of Service Totara Road WWTP Treatment Process Upgrades The assumption in this AMP is that significant new developments at the Totara Road WWTP will not occur until after new resource consents are granted most probably in The current consents are due to expire in 2028, but the Council has agreed to apply for new consents by June It is anticipated that there will be higher environmental and water quality standards to be met, as well as higher expectations from the community when the new consents are applied for. It is inevitable that new treatment processes and upgrades of the treatment facilities will be required to meet those objectives. Resulting from the recent consent review undertaken by Horizons it was also agreed that a more extensive Best Practicable Options investigation would be undertaken with the outcome forming the basis of the new consent application. Totara Road WWTP Sludge Disposal Currently all sludge produced from the wastewater process is dewatered and then composted on the neighbouring Awapuni Resource Recovery Park. A sludge disposal options study was undertaken and this will guide the ultimate decision on new technologies that might be used to treat treatment plant sludge s. It is proposed that the ultimate decision on sludge disposal will be part of the WWTP BPO exercise and subsequent consent renewal upgrade. Seismic Strengthening to Wastewater Structures (Refer programmes 630 and 1074) Delivery of Programme The programme will be delivered by Council s in-house staff, or external contractors for more specialised works. The delivery method chosen will depend on the size and complexity of each individual programme. The Project Status reporting programme will be used to track the progress of individual projects that make up the overall programmes to ensure both the timeliness of delivery and costs. This will deliver reports to the monthly Works Programming meetings in which the progress of each project is reviewed. 90

107 Section 6 Assets & Lifecycle Management Non Asset Programmes Education initiatives were identified in the level of service workshops with councillors as a means of addressing a number of challenges in the wastewater network including: blockages due to wet wipes opportunities to reduce nutrient loads e.g. phosphorus by engaging with trade waste dischargers and reviewing opportunities at the residential scale introduction of a programme to receive hazardous household chemicals and divert them from discharge to the sewer and stormwater network targeting inflow and infiltration reduction at the property level by establishing a dedicated I&I reduction programme identifying commercial activities in the residential area that require pre-treatment e.g. grease traps etc Disposal of Assets Any assets that require disposal will be done so in the most advantageous way. For some assets, this will involve sell by public tender via Tender Link or other publications. For minor or broken/damaged assets, disposal may be by way of direct sale to metal recyclers or similar recycling facilities Key AMP Improvement Projects Relating to Asset Lifecycle Management For the key AMP improvement projects relating to wastewater Asset Management and Lifecycle Management, refer to the following items in, Section 11 Continuous Improvement: Item 1, Development works planning (demand/los): Document changes to AMP programmes that arise through 10 Year Plan and Annual Budget process. Item 2, Asset information: Update detailed asset component and condition information in AM system; Review AM system data quality process and develop data improvement plan: Review condition assessment programme; Review performance data needs; Analyse asset lives using available data; and Assess advanced AM system needs and implement suitable application for predictive modelling Update programme policies and information data. Item 3, Renewal works planning: Continue to develop predictive modelling; and Develop processes to prioritize risk mitigation options (Section 2 of Improvement Plan). Item 4, Operations and maintenance: Work on optimising operations and maintenance programmes; and Further develop processes to ensure competitive prices are obtained. Item 9, Delivery of services: Improve internal service processes (SLA, Market Comparability &CWP). 91

108 Section 6 Assets & Lifecycle Management 92

109 Section 7 Risks & Resilience 7 Risks & Resilience Infrastructure risk management is the process of identifying risks that may affect the ongoing delivery of services from infrastructure. 7.1 Corporate Risk Management Framework A corporate risk management policy (MT 76, April 2011) has been established to enable risks to be managed in an effective and appropriate manner. From an asset management perspective, the policy helps prevent the Council taking risks that compromise its ability to provide and maintain key infrastructure and services. Progress with mitigation actions is monitored and reported to Council Risk Management Policy The risk management policy covers strategic, operational, and project risks. It applies to all functions performed by the Council and to all staff employed in carrying out its functions. Strategic risks are defined as those things that prevent the Council from implementing its strategies. They can be caused by misalignment between goals and strategies, or the Council simply not implementing its strategies. Operational risks are inherent in the processes chosen to implement the Council s strategies. The benefits of managing operational risks include meeting financial goals, maintaining quality, proactive and effective planning, and preparedness for emergencies. Project risks are of a specific, normally short-term nature. The benefits of managing these risks include the avoidance of time and cost overruns Strategic Risks The key strategic risks to the Council achieving its desired outcomes have been identified as follows: Poor City image and reputation. Lack of vibrancy in the CBD. Decline in the City economy and jobs. A low level of community trust and engagement with the Council. Council s financial position is not sustainable. These risks are mitigated through following the Council strategies set out in Section 3.1 and through quarterly reporting to the Council. Development and management of the Council s infrastructure is part of this risk mitigation Operational Risks Operational risks identified in the Risk Management Policy, relevant to this activity, are contained in Table

110 Section 7 Risks & Resilience Table 27: Operational Risks Operational Risk Corporate Mitigation Strategy Corporate Mitigation Action Council's infrastructural assets are not managed in accordance with the adopted Asset Management Plans (AMPs) and/or granted Resource Consents Council's infrastructural assets are not managed in accordance with the adopted Asset Management Plans (AMPs) and/or granted Resource Consents Council does not deliver the capital (new and renewal) programmes within approved scope of works, planned timeframes and budget. 1. Manage infrastructural assets in accordance with AMPs as funded through the 10 Year/Annual Budget 2. Ensure infrastructural asset programmes developed for the AMPs and then presented for consideration in the 10 Year /Annual Budget have adequate justification in terms of assessing options, feasibility, economic, social and environmental factors. 3. Operate infrastructural asset activities in compliance with the granted Resource Consents 4. Operate infrastructural asset activities in a manner that uses the AMP risk register.responses for specific risk situations as and when these may arise 1. Set realistic capital revenue and expenditure budgets 1.1 Review AMPs three yearly, assessing assets over a 30 year period to increase certainty to condition assessments Seek continuous improvement of each AMP in terms of quality that matches best practice in NZ Incorporate consideration of city growth, climate change, urban design and environmental sustainability into each AMP. 1.2 Report to Council where necessary implications of difference in budgets between 10 Year Plan with AMPs, and determine revised asset management actions Ensure Infrastructure programmes aligned with the zoning for growth. 1.3 Implement infrastructural programmes (operations and maintenance, renewals and capital new) Programmes associated with the Totara Road Wastewater Treatment Plant (WWTP) and closed Awapuni Landfill, in respect to their impact on the Manawatū River Programmes associated with cycle/pedestrian pathway, in respect to property negotiations and Community stakeholders engagement. 2.1 Develop programme justification for the AMPs to feed into the annual planning process 3.1 Maintain a database of all required Resource Consents 3.2 Monitor compliance against the database 3.3 Attend to Resource Consent renewals before expiry deadlines 4.1 Report quarterly on infrastructural asset activities against the appropriate AMP Risk Register items in terms of invoking any of the "controls", "treatment" and/or "management options". 1.1 Use City Networks Programme Planning and Implementation Template, identify and update (at least annually) the status of programmes in respect of scope, assumptions, and planning milestones, budget estimates and funding sources. 1.2 Within the City Networks Programme Planning and Implementation Template 94

111 Section 7 Risks & Resilience Operational Risk Corporate Mitigation Strategy Corporate Mitigation Action identify the external factors which must be addressed to advance the programme and establish appropriate milestone dates as to when these factors will be addressed. 1.3 Information in the Programme Summary of the Ozone Corporate Planning module is referenced against an up to date City Networks Programme Planning and Implementation Template. 1.4 Identify as potential delayed flags those capital programmes which have constraints beyond management s control as part of the budget approval process 1.5 At the commencement of the financial year identify those capital programmes where there is confidence of delivery because contracts (& SLAs) are in place. 1.6 At the commencement of the financial year identify those capital programmes where planning is well advanced such that contracts (& SLAs) can be established in the 1st quarter of the financial year 2. Scrutinise all capital revenue and expenditure budgets exceeding $250k. 2.1 Signed off by the relevant General Manager 2.2 Review budget for reasonableness (all individual capital budgets) 3. Obtain Management Team approval on all capital projects that require a Project Execution Plan (PEP) before commencement of the project 4. Assess resources required to deliver the overall capital programmes 5. Manage projects against recognised good practice. 3.1 Active management by General Manager 3.2 Report to Chief Executive of all noncompliance instances 4.1 Use the Works Programming Forum both City Networks and City Enterprises identify the internal resources to be allocated to programmes and then determine any shortfall which requires the engagement of external consultant/contractor resources. 5.1 Deliver projects in accordance with City Networks Asset Management Good Practice Guidelines in relation to Project Management discipline. 5.2 Develop and regularly review Project Execution Plans (PEPs) for significant projects, with specific attention to any change circumstances which may impact on scope of works, timelines and/or budget requirements 6. Monitor progress in the delivery of capital programmes 6.1 Monitor progress through Works Programming Forum 6.2 Monitor progress of work through monthly financial reports, and the Project Status Reporting tool both actual year to date against the current financial budget and against the total project budget spanning more than one financial year. 95

112 Section 7 Risks & Resilience Operational Risk Corporate Mitigation Strategy Corporate Mitigation Action 6.3 Identify programmes which cannot be delivered due to changed circumstances giving the reason why. 6.4 Utilise Council's approval of commencing up to 20% renewal works prior to the formal adoption of the new financial year budget PNCC is not meeting its responsibilities for an emergency or a civil defence emergency event because it is unable to deliver the basic services. Council's activity preparation in key areas does not align to the 10 Year Plan programmes approval and budget processes and vice versa. 1. Develop and maintain high level PNCC Business Continuity Plan(s) (BCP) 2. Ensure integrated planning occurs across Council s recreation assets 3. Implementation of the Street Design Manual 1.1 Prepare and maintain high level PNCC Business Continuity Plans (BCP) 2.1 Concept and development plans are developed for Council s recreation facilities and reserves aligned to the Active Recreation Strategy Year Plan recreation programmes for the first 3 years are informed by soundlybased development plans 3.1 Programme of work is developed to implement the Street Design Manual Year Plan levels of service align with changes promoted in the Street Design Manual Year Plan Programmes advance implementation of the Street Design Manual and for the first 3 years are informed by soundly-based development plans Project Risks Project risks associated with significant individual projects (both operational and capital) are normally of a short term nature and are managed through specific project plans approved through the Corporate Management Team. They include acquisitions and investments Risk Management Hierarchy Figure 29 demonstrates the risk management hierarchy from corporate risk management down to activity, project specific, and operational risk management. Risk is managed at these various levels within the Council s risk management framework. The level of risks included at each layer is appropriate to that layer, but filters down where appropriate with increasing detail. 96

113 Section 7 Risks & Resilience Natural & Technologic al Risks Physical/ Asset Failure Risk Public Health & Environment Corporate Risk Management Civil Defence Management Group Risk Management Activity Risk Management Project Risk Management Operational Risk Management Figure 29: Risk Management Hierarchy Within all the levels of risk management discussed above, consideration is given to the management of both everyday risks and the low frequency high impact events such as natural disasters. When existing assets are being renewed or new works constructed, the potential of those works to affect the resilience and readiness of all lifeline networks is considered. Contingency plans are prepared to ensure, through operational systems and temporary response structures, that appropriate response can be made Asset Criticality Those assets where failure would likely result in a significant disruption in service and financial, environment, and social cost in terms of impact on organisational objectives are considered to be critical assets. The definitions used in this plan for critical assets, customers, and suppliers are as follows: Critical assets are defined as those assets with the highest consequence of failure, but not necessarily a high probability of failure. In determining consequence of failure, both importance to the city and importance to the service provided are taken into account. Critical customers are those relying on essential services provided by the Council (e.g. water supply to schools and hospitals). Critical suppliers are those providing services required for the delivery of the Council s essential services (e.g. energy supply, communication systems, etc). The criteria used to assess criticality are set out in Section Resilience The National Infrastructure Unit defines resilient infrastructure as infrastructure that is able to deal with significant disruption and changing circumstances. This may be due to natural hazards and shock events or events which evolve over time such as changing demographics. However, this plan is largely focused on being able to provide essential services following a high consequence event such as a natural disaster. Resilience of critical assets is particularly important for continuation of service delivery. Both technical and organisational aspects of resilience have been considered in this plan. 97

114 Section 7 Risks & Resilience Table 28: Resilience Definitions Dimension Attribute Definition Technical Robustness / Resistance Organisational Redundancy Reliability Preparedness, Response and Recovery The strength or the ability of elements, systems, and other units of analysis, to withstand a given level of stress or demand without suffering degradation or loss of function. The extent to which elements, systems, or other infrastructure units exist that are substitutable, i.e. capable of satisfying functional requirements in the event of disruption, degradation, or loss of functionality. The extent to which the infrastructure components are inherently designed to operate under a range of conditions and hence mitigate damage or loss from an event. The capacity to mobilise resources when conditions exist that threaten to disrupt some element or system to maintain service and enable a fast and effective response to and recovery from disruptive events Risk Management Process This plan is based on AS/NZS ISO 31000:2009 as the basis of its approach to risk identification and management. The Standard defines risk as the effect of uncertainty on objectives. Effective management of risk is important to maintain the performance and functionality of the Wastewater Activity. Risk management is one of the factors used to determine optimum maintenance frequencies and the level and timing of asset renewals. The risk management process considers the following stages: Risk management context determining the framework within which Council-wide risks will be managed. Risk identification identifying the relevant risks. Risk analysis scoring or rating each of the risks identified in a way that makes them comparable across the organisation. Risk treatment identify the actions to be taken. Monitor and review the risks to ensure mitigation is successful and identify new risks. This process is summarised in Figure 30 below. Figure 30: Risk Management Process (AS/NZS ISO 31000:2009) Further details of the process followed and the risk management register are given in Appendix D. 98

115 Section 7 Risks & Resilience 7.2 Activity Risk Management Approach for the Activity Risk assessments at the activity level focus on risks associated with management of the activity and the enabling infrastructure. Activity risk assessment considers risks identified at both the corporate and the operational level. Risk management planning has been used to identify the potential and actual business risks associated with the provision and management of the Council s wastewater assets and services. The process has been applied to prioritise mitigation programmes. The key risk categories adopted for assessing the consequences of identified risks for this activity are: Legal; Environmental; Corporate Image; Service delivery; Financial; and Community Health and Safety. A full list of the assessed risks facing this activity, including risks from natural events, is detailed in the Risk Register appendix. The Register also summarises the current mitigation measures and the proposed, or planned, changes to these Role of Activity as a Lifeline Utility The Civil Defence and Emergency Management Act 2002 contains specific requirements in relation to Lifeline Utilities. The term lifeline utility is defined as an entity named or described in Part A of Schedule 1, or that carries on a business described in Part B of Schedule 1 of the Act. The wastewater network is regarded as a lifeline utility. Section 60 of the Act states the duties of lifeline utilities: 60. Duties of lifeline utilities Every lifeline utility must (a) (b) (c) (d) (e) ensure that it is able to function to the fullest possible extent, even though this may be at a reduced level, during and after an emergency: make available to the Director in writing, on request, its plan for functioning during and after an emergency: participate in the development of the national civil defence emergency management strategy and civil defence emergency management plans: provide, free of charge, any technical advice to any Civil Defence Emergency Management Group or the Director that may be reasonably required by that Group or the Director: ensure that any information that is disclosed to the lifeline utility is used by the lifeline utility, or disclosed to another person, only for the purposes of this Act. The Act also has national and regional requirements, including the roles of Controllers, the establishment of Civil Defence Emergency Management (CDEM) Groups, and the preparation of CDEM Plans. 99

116 Section 7 Risks & Resilience Critical Assets Overview Critical assets are regarded as those assets which have the highest consequences should they fail. A simple approach has been taken in this plan, applying broad assumptions about the implications of failure, using a number of criteria to make an overall assessment of high, medium, or low criticality. The approach to proactively managing risks is given in section 7.5. The criteria used for assessing criticality for the Wastewater Activity are as follows: Numbers of people adversely affected; Significant business activity interrupted; Consequential cost of failure; Critical lifeline/disaster recovery asset; and Other. Critical assets are defined as those that have a high consequence of failure. By identifying critical assets, it is possible to target inspections, maintenance, and renewals expenditure in the most critical areas. Criticality is graded as High, Medium, Low, or Non-critical, and is broadly based on the number of people affected by the asset failure. Table 29 contains the population banding used for Palmerston North. Table 29: Population Based Criticality Grading Criticality High Medium Low Non Critical Population Affected Above 8,000 persons Between 6,000 and 8,000 persons Between 4,000 and 6,000 persons Up to 4,000 persons Wastewater Pipes Criticality Grading Typically, larger diameter pipes serve larger populations. Using assumptions around a pipe s capacity, it is possible to broadly categorise criticality of wastewater pipes based on diameter. The criticality grading of wastewater pipes is shown in Table 30. Table 30: Criticality Grading for Wastewater Pipe Assets Pipe Diameter [mm] Equivalent Population Criticality 250 2,973 Non Critical 300 4,823 Low 315 5,490 Low 375 8,750 High ,238 High ,488 High ,693 High 100

117 Section 7 Risks & Resilience Wastewater Pump Station Criticality Grading In assessing criticality of pump stations, the sensitivity of the receiving environment to overflows is considered, as well as the population served. Table 31 shows the criticality grading for the pump station that are categorised as Low criticality or above. Non-critical pump stations are not listed. Table 31: Criticality Grading for Wastewater Pump Station Assets Pump Station Capacity [L/s] Equivalent Population Served Criticality College Street 59 5,098 Medium Jickell Street 100 6,480 Medium Massey ,920 High Maxwells Line ,931 High Tremaine Avenue 53 4,579 Medium Ashhurst Pond 47 2,634 low KB Road Bunnythorpe Medium Wastewater Treatment Critical Assets Criticality of treatment plant assets is based on the consequence of failure of each component and its role as part of the treatment process overall. Dependent Customers & Services For details of customers or services that depend on the Wastewater Activity refer to Report for Critical Assets - Vulnerability Review - Phase 1 (GHD, March 2011) Resilience The approach taken in this plan is to assess the impact of particular natural hazards on the critical assets of the wastewater activity. This considers the current level and desired level of resilience. Section 7.4 summarises this assessment and Section 7.5 outlines the mitigation strategy adopted in this plan to reduce the risk. The interdependencies of other utility services are identified in Section Further work will be undertaken in the next 2-3 years to develop a more comprehensive approach, in which the level of criticality is matched against the desired level of resilience, together with the options available for achieving it. A programme for further work is included in the Improvement Plan Sources of Risk The sources of risk affecting the activity are as follows: Operational failures. Physical asset risks. Project & planning risks. Natural hazards. Events & Incidents. 14 GHD, Report for Critical Assets - Vulnerability Review - Phase 1, March 2011 (DM#995683) 101

118 Section 7 Risks & Resilience Risks arising from these sources are elaborated on in Section Reference Documents Documents that have informed this plan include: 1994 Hazards Analysis Risks & Responsibilities Lifelines Project Report Hazard Risk Assessment for the Manawatū-Wanganui Region GHD Critical Assets Phase 1 Report Three Waters GNS Liquefaction Report City Infrastructure and Civil Defence Preparedness PNCC Engineering Standards Resilience Review. PNCC District Plan Section 22: Natural Hazards Floods. 7.3 Key Risks to the Wastewater Activity The five sources of risk impacting on the activity are considered to be operational failure, asset failure, natural disasters, events and incidents, and project and planning risks. The risk register in Appendix D sets out the identified risks arising from these sources. The key risks largely based on criticality are summarised in this section. It should be noted that from these sources there may be consequences in the following areas: Legal; Environmental; Corporate Image; Service delivery; Financial; and Community Health and Safety. These have been considered in identifying the key risks for this activity Operational Failure Operational failures are those events that may prevent service delivery as intended, such as contamination, vandalism, operator error, injury, crash, or contract management issues, but do not involve a physical breakdown of the asset. The operational failure that occurs may also have other consequences, as noted above. The key operational risks and mitigation measures for this activity are summarised in Table 32. Table 32: Key Operational Risks & Mitigation Measures Key Operational Risks Likelihood Mitigation Measures Odours from the system (WW21) High Odour control devices. Chemical treatment. Tighter Trade Waste Controls. Power Failure (WW18) Medium Continuous monitoring via telemetry. Standby generators (permanent & mobile). 102

119 Section 7 Risks & Resilience Asset Failure Asset failure can arise from deterioration in condition, leading to structural failure or loss of performance of the asset, which then impacts adversely on the service provided to the community. The key risks relating to asset failure and mitigation measures have been identified in Table 33. Table 33: Key Asset Failure Risks & Mitigation Measures Key Asset Failure Risks Likelihood Mitigation Measures Network blockage or breaks (WW17) High Ongoing condition assessments/investigations. Inflow & infiltration investigations. Programmed flushing. Public education regarding acceptable disposal practices. Pump station failure (WW20) Medium Continuous monitoring through telemetry. Staff Training. Regular maintenance. WWTP failure (WW19) Medium Continuous monitoring through telemetry. Staff training. Regular maintenance Project & Planning Risks Project and planning risks occur when infrastructure is not provided in a timely way, or does not meet the needs of the community, as a result of inadequate project management and planning processes and resources. The key risks and mitigation measures identified are summarised in Table 34. Table 34: Key Project & Planning Risks & Mitigation Measures Key Project & Planning Risks Likelihood Mitigation Measures WW22 Network capacity failure due to lack of planning Low Involvement with City Future Planning and Growth development Natural Disasters The impact of natural disaster hazard events on the infrastructure of the Wastewater activity has been considered, with a particular focus on lifelines, critical assets, and interdependencies The events considered are those used in the Lifelines Hazard Assessment: Earthquake an MM9 shaking intensity (return period 1000 years). Flood equivalent to the 2004 Lower North Island flood event (return period of about a 100 years). Volcanic an eruption of Mt Ruapehu with a 12 km high column. There is further discussion in Section 7.4, which describes the hazards and assesses the resulting impacts on critical assets. The initial response will include those measures set out in the CDEM Group Plan and the Business Continuity Plan. 103

120 Section 7 Risks & Resilience Events & Incidents Other events and incidents that could impact on the assets and the services will be managed largely through the measures and procedures set out in the Business Continuity Plan (refer Section 7.7.3). 7.4 Resilience of Infrastructure to Natural Disaster Introduction This section considers the impact of seismic, flooding, and volcanic events on critical assets, and the assessed level of resilience to such events. It has been informed by the reports and investigations listed in Section The Lifelines Project Report 2005 found that the region as a whole is most at risk from seismic hazard in particular liquefaction could cause significant damage in a severe earthquake Seismic Hazard The wastewater system has between 3 and 6 hours of storage in the event of power failure before overflow occurs. Backup power for most small pump sites is via a mobile generator maintained by City Enterprises, which must be moved from site to site. Permanent backup power is provided at the Massey and Maxwell s Line pump stations and the Totara Rd WWTP. In the event of pump station failure, overflows occur to water courses. Failure or overloading of the treatment plant will result in overflow to the Manawatū River and/or the Mangaone Stream. The WWTP has backup power generation. Because most of the sewer network is a gravity system, sewage could, assuming laterals are not damaged, still be received from most customers and disposed of via overflows, even when most pump stations and/or the treatment plant are not operating. However, a functioning gravity pipe network is essential. A reasonable volume of water is also needed to flush a toilet and keep a sewer pipe working consequently, either the piped water supply system needs to be operational, or residents need ready access to bulk water storage for filling buckets or other containers. By-pass pumping could assist a partially damaged pipe network, although the city has very few pumps suitable for this duty, and these pumps would need to come from further afield. Approximately 80% of the pipe network is made of brittle materials (reinforced concrete or earthenware) that could be expected to result in fractures and joint pull-outs in a severe earthquake. In addition, in those areas subject to liquefaction, manholes and pumping stations could be displaced. Table 35 provides a summary of the assessed resilience of the assets to a MM9 earthquake, with a return period of 1,000 years. Where the current level of resilience is less than desired, further work is to be undertaken over the next 2-3 years to determine options for future management and development of the asset. Table 35: Seismic Resilience Asset Criticality Current Level of Resilience Desired Level of Resilience Totara Road Wastewater Treatment Plant High Moderate Very high Palmerston North main pump stations (Maxwell s Line, Massey, Jickell St, College St, Linton Army, Ashhurst) High Low to moderate Very high 104

121 Section 7 Risks & Resilience Asset Criticality Current Level of Resilience Desired Level of Resilience Palmerston North wastewater trunk mains High Moderate Very high Manholes Varies Low to moderate Moderate to High Reticulation Varies Low to moderate Varies Flooding Hazard The WWTP and many of the pump stations are located at near river level and may be subject to flooding. Although the city reach is currently protected against a 1:500 year flood, these assets may be at risk from localised intense rainfalls, or from flooding in excess of this. Flooding would increase flows into the local pump stations and the WWTP, and could lead to overflows within the wastewater network and the treatment plant. Excess flows at the WWTP would require bypassing of the inlet works with direct flow to the Manawatū River, or via the spillway from the aerated lagoons to the Mangaone Stream Volcanic Hazard Volcanic ash is highly abrasive, mildly corrosive, and conductive. Freshly fallen volcanic ash may result in short-term physical and chemical change in water quality, increased wear on wastewater delivery and treatment systems, disruption of electrical power supplies, and high demand for water during clean up. Volcanic Ash may form un-pumpable masses in catchpits and sewer lines which may cause blockages, cause overflows, and damage pumping equipment. Coarse ash is likely to block inlet screens, cause damage to moving parts and overload mechanical equipment. This ash will also increase the volume of raw sludge. Fine ash may not settle, and low density pumice will float. Ash deposited directly into open ponds and clarifiers may reduce or halt the oxidation process. Ash is also highly acidic, which may affect bacteriological treatment processes, and fine ash may reduce the effectiveness of UV treatment. Ash fall may also affect other critical infrastructure, such as electricity supply, water supply, and telecommunications, which compromise the functioning of the treatment plant Other Natural Hazards There are also other natural hazards such as landslides, wind, or lightening that may impact the wastewater treatment. Sufficient assets redundancy will provide better resilience Interdependencies Wastewater critical assets are not stand alone. To operate effectively, wastewater assets are dependent on a variety of other utilities / infrastructure providers. Other utilities also rely on the continued serviceability of the assets of this activity. To effectively manage risk, these interdependencies have been evaluated to identify where the highest levels of dependency exist and the implications of failure. Table 36 identifies the utility services that this activity depends on, the level of dependence, and the mitigation measures in place. 105

122 Section 7 Risks & Resilience Table 36: Utility Services that the Wastewater Activity Depends on for Continuity of Service Critical Assets Utility Service the Asset is Dependent on Implications of Failure of the Asset Depended on Mitigation Measures WWTP Power Sewerage overflows Standby power, Alarms Pump Stations Power Road Bridge (Fitzherbet Ave) Sewerage overflows Availability of standby power, alarms WWTP Water Supply Blocking of equipment Recycling of wastewater 7.5 Risk Management Strategy The approach to managing the asset to provide for mitigation of risk and increasing the resilience of the assets and networks is as follows: On-going management and development of the assets according to sound asset management practice. This includes having a good knowledge of the assets and planning appropriately for maintenance, renewal, and development. Developing the assets to provide for future capacity requirements in a timely way to avoid any loss of service through overloading of the system. Implementing programs for timely renewal of the assets, particularly critical assets, to reduce the risk of unexpected failure and loss of service. Prioritising inspection, maintenance, and renewal work to those areas that carry the greatest risk for the Council. Regular inspections of critical assets in particular large diameter trunk mains. On-going review and refinement of the risk register to provide greater understanding of those asset components that carry higher risk. Investigating, over the next 2-3 years, options for increasing the resilience of the asset and developing tools, such as risk based economic analysis, to assist sound decision making. This is to be part of the Improvement Plan. Including specific programs for strengthening of structures where warranted or required to meet standards. Incorporating greater resilience when renewing or building new assets through materials selection and application of higher design standards. Maintaining a readiness for responding to disaster events through having an up to date Business Continuity Plan and participating in the CDEM arrangements. 7.6 Risk Management Program The programmes that contribute in this plan to mitigate risk and to increase resilience are summarised in Table 37. Table 37: Risk Management Programme Programme Impact on Risk & Resilience Cost Year Maintenance Operation programmes to undertake regular inspections of assets (SLA s) $400k/yr Ongoing Renewal Increased pipe renewal expenditure Various renewal programmes at WWTP $ M/yr Ongoing 106

123 Section 7 Risks & Resilience Programme Impact on Risk & Resilience Cost Year Development Duplication of inlet main to WWTP Earthquake strengthening WWTP Seismic strengthening to WW Structures (PS) $400k $1M $200k 2017/ / Investigation WWTP Investigations into seismic and liquefaction risks Yearly CCTV inspections of WW mains $100,000 $55k/yr 2017/18 Ongoing Readiness BCP etc. Asset management systems and emergency action plans to mitigate natural disaster risks. Ongoing 7.7 Civil Defence Preparedness Emergency Events The Civil Defence and Emergency Management Act 2002 defines an emergency as a situation that: is the result of any happening, whether natural or otherwise, including, without limitation, any explosion, earthquake, eruption, tsunami, land movement, flood, storm, tornado, cyclone, serious fire, leakage or spillage of any dangerous gas or substance, technological failure, infestation, plague, epidemic, failure of or disruption to an emergency service or a lifeline utility, or actual or imminent attack or warlike act; causes or may cause loss of life or injury or illness or distress or in any way endangers the safety of the public or property in New Zealand or any part of New Zealand; or cannot be dealt with by emergency services, or otherwise requires a significant and co-ordinated response under this Act Emergency Response Plan The Act also requires the establishment of CDEM Groups based on Regional Council boundaries, working in partnership with emergency services, lifeline utilities, and others, to deliver CDEM at the local level. Each Group is required to prepare a plan to describe the Group s CDEM arrangements that set, out among other things: Hazards and risks to be managed by the Group. Civil defence emergency management necessary to manage the hazards and risks. Arrangements for declaring a state of emergency in the area. Arrangements for co-operation and co-ordination with other Groups. The Manawatū-Wanganui Civil Defence Emergency Management Group Plan covers the CDEM operational arrangements for the assets and services described in this AMP. The four phases of disaster management outlined in the plan and their applicability to this activity are as follows: Reduction Identifying and analysing long-term risks to human life and property from natural or man-made hazards, and taking steps to eliminate these risks where practicable, and where not, reduce the magnitude of their impact and likelihood of their occurring. For this activity this is achieved through two key initiatives: 107

124 Section 7 Risks & Resilience PNCC contribution to the Lifelines Advisory Group which aims to facilitate information exchange and collaboration between the various utility service providers in the region with respect to CDEM. This group is also responsible for maintaining and improving the Regional Lifelines Project Report Risks and Responsibilities. Ensuring that the development of infrastructure development is in keeping with PNCC District Plan provisions which, in turn, have been informed by Horizons One Plan with respect to placement of critical infrastructure in areas prone to natural hazard events. Readiness Developing operational systems and capabilities before a disaster happens. These include self-help and response programmes for the general public, as well as specific programmes for emergency services. A significant portion of the CDEM Group s work is undertaken as readiness initiatives. The group provides co-ordinated planning to ensure an effective response to the affected communities, and for the co-ordination of responding agencies. This activity provides inputs into these activities. Response This relates to response actions taken immediately before an emergency is declared and lasts until the normal systems can accommodate the recovery process. A fundamental principle for this phase is that agencies should respond to an emergency by activating their own plans and co-ordinating with the lead agency. In the case of this activity, the Business Continuity Plan described in Section would be activated. Recovery This relates to activities beginning after initial impact has been stabilised and extending until the community s capacity for self-help has been restored. Recovery is a key part of the comprehensive approach to CDEM and, for this reason the Group has a comprehensive Recovery Plan. The impact of a major event can lead to long term recovery needs for the City. For the wastewater activity, this is discussed in Section Civil Defence Emergency Management Amendment Act 2016 The changes to the Civil Defence Emergency Management Act strengthen recovery planning. This amendment specifically requires CDEM Groups to amend their plans by 1 June 2018 to include strategic planning for recovery from the hazards and risks in their district. Work on this amendment is currently underway Business Continuity Plan A Business Continuity Action Plan has been prepared for the Water & Waste Services to provide information and strategies, including co-ordination of people and resources, that will enable continued availability of business process and services and recovery from events that interrupt those services. The Water and Waste Action Plan contains: The Water & Waste Services call tree. 108

125 Section 7 Risks & Resilience Incident Management Team. Water & waste services continuity and recovery strategies: Accessibility, Resources and Communication; and Wastewater Disposal. Contact Lists for both internal and external contacts. Response Centre Details - Arena Manawatū Recovery In the event of a major disruption of service, establishing at least a temporary supply to critical customers would be a priority. Should the event have caused widespread disruption to the water network and recovery over a long term is required, then a recovery programme will need to be put in place. This programme will cover: Priorities for work done on the asset; Consideration of changes in the way the assets could be configured and materials used if a significant replacement programme was required; Potential funding needs/issues; and Relationships between the assets and other utilities assets e.g. co-location in road corridors. On-going work will be undertaken on these aspects Lifeline Utilities Coordination Protocols and arrangements to facilitate communication and co-ordination with other utilities, in the event of a major event affecting multiple agencies, are set out in the CDEM Group Plan The following organisations are members of the Lifelines Advisory Group: Horizons Regional Council Palmerston North City Council Ruapehu District Council Wanganui District Council Rangitikei District Council Manawatū District Council Tararua District Council Horowhenua District Council Transpower NZTA Spark NZ Vodafone 2 Degrees Inspire Net Chorus Electra First Gas Kordia Scanpower Kiwi Rail PowerCo GasNet Palmerston North International Airport Mid Central DHB Teamtalk The Lines Company Foodstuffs 109

126 Section 7 Risks & Resilience Risks and Resilience Improvement Plan Particular aspects that require further development. Further assessment of risk and programmes to mitigate risk in the light of further investigation and better information about the impact of natural hazards. Develop a more advanced approach to identifying critical assets that incorporates rating and other dimensions of criticality. Further assessment of the current level of resilience. Develop a more comprehensive method of assessing resilience using risk based evaluation and optimised decision making tools to assist decision making around the desired level of resilience. On-going review of the risk register. Provision is made in the continuous improvement programme, Section 11, for further work on these aspects over the next three years. 110

127 Section 8 Sustainability 8 Sustainability This section sets out how the wastewater activity contributes through the management of its assets to the city having a sustainable future. The practise of asset management is itself based on sustainably delivering services to the community. 8.1 Eco City Strategy The Eco City Strategy is one of the Council s main strategies supporting its vision for the City and aims to contribute to the city developing and growing in a way that is sustainable. This includes having a reduced ecological footprint through effective planning of infrastructure and the protection, maintenance and enhancement of the city s natural and built environment. The Council is also working towards the city becoming a low carbon economy. To achieve the desired outcomes the Council has set a number of priorities and developed Strategy Plans under the Eco City Strategy as shown in Table 38. Table 38: Relevant Eco City Strategy Priorities and Plans Eco City Strategy Priorities Respect and enhance the mauri of the Manawatu River Work with the community to reduce carbon emissions Regenerate native biodiversity Invest in infrastructure that serves to protect, enhance and preserve our environment Use our legislative powers and policies to ensure that urban development is sustainable now and into the future Educate the community, in particular, property owners, on the benefits of investing in sustainable building design and green buildings Demonstrate leadership and best practice by developing and implementing an environmental sustainability plan for the Council Eco City Strategy Plans Biodiversity Water Waste Energy Environmental education Carbon emissions reduction In addition Sustainable Practices is one of the themes that is to be reflected in all of Council s strategies and plans. Key Sustainability Issues Key sustainability issues from these plans for the wastewater activity are as follows. Minimising the impacts of the wastewater activity on the land and receiving water bodies Embedding energy efficiency and sustainability into all aspects of the wastewater operations by utilising energy efficient motors when undertaking replacements or upgrades. Incorporating the concept of energy neutrality into future WWTP upgrades. Increasing energy generation at the WWTP through increased waste diversion to the digesters. Developing a sustainable solution for the disposal of sludge. 8.2 Climate Change Overall, it is anticipated that climate change will have minimal impact on the sustainability of wastewater services. It is predicted that, as a result of climate change, the weather in the region will 111

128 Section 8 Sustainability be warmer and wetter, with more intense rainfall. Depending on the success of the proposed I&I programme this may or may not have impact. This will be monitored over the term of the AMP. 8.3 Approach Taken in This Plan Sustainability considerations are incorporated into the AMP through the following mechanisms: The Discharge Consent Permits for Totara Road. Operational Plans for WWTP and Biogas Electricity Generation. Operational Plans for the Wastewater Treatment Plants and Pump Stations. The proposed Sludge Management Plan - application of bio-solids to land through composting or other processes. Implementation of food waste and organic waste to energy initiatives by utilising surplus digester capacity to treat organic waste to generate biogas which is then burned in the gas energy to generate electricity to run the wastewater treatment plant site Participation in peak load shedding events by using standby generators during periods of peak electricity demand. 112

129 Section 9 Financial Projections & Trends 9 Financial Projections & Trends This section outlines the long-term financial requirements for operations, maintenance and capital renewal and development for the wastewater activity based on the long-term strategies and tactics described earlier in the AMP. 9.1 Long Term Financial Forecast Proposed Operation & Maintenance Expenditure Figure 31 shows the thirty year projected operating expenditure excluding interest and depreciation. The significant increase in operating programme expenditure occurring from 2026/27 onwards is based on the assumed significantly higher cost of a new wastewater treatment and disposal facility. The specific additional costs and their relative proportion will depend on the preferred solution approved by Council and consented through the RMA process. Additional costs are likely to be associated with energy, mechanical and electrical maintenance, staffing, chemical consumables and sludge treatment and disposal. Higher interest costs will also be incurred for the upgraded facility. The reason for the slight reduction in costs in 2024/25 and 2025/26 is the end of the Wastewater BPO Operational Programme Management Delivery Operating Programmes Proposed Renewal Expenditure [Millions] $10 $9 $8 $7 $6 $5 $4 $3 $2 $1 $0 2018/ / / / / / / / / /46 Figure 31: Thirty Year Operation & Maintenance Expenditure Forecast Proposed Renewal Expenditure Figure 32 depicts the thirty year projected renewals expenditure broken down into major asset groups. The majority of the renewal expenditure is associated with network and pump stations. The network renewal profile for the first 10 years reflects a clear programme of renewals based on condition and performance risk and an enhanced level of investment to address legacy condition issues in the network. Beyond 2032/33 the investment in network renewals drops back to an average provision of 113

130 Section 9 Financial Projections & Trends some $1.9 M per annum. It is expected that the investment in CCTV and optimised modelling will enable a more accurate prediction of network renewals to be developed. While there is some significant investment in treatment plant renewals over the first 10 years of the AMP this is mostly associated with screening, grit removal and upgrading of inlet pumping. It is assumed that following the proposed upgrade of the treatment and disposal facility currently indicatively timed to occur in 2026/27 there will be no significant renewal investment in the plant for a period of time on the basis that much of the plant will be newly refurbished or upgraded. The spike in renewal investment in is associated with renewal of the trunk sewer in Tremaine and Featherston as well as upgrades to SCADA and the biogas engine at the wastewater treatment plant. Renewal investment approaches depreciation levels in the first few years of the plan, given the significant number of assets approaching end of life, however following the investment in the upgraded treatment and disposal facility, depreciation increases significantly. The higher rates of depreciation do not trigger additional renewals given the assets are assumed to be new or recently refurbished and at the early stage in their lifecycle.. Proposed Renewal Expenditure [Millions] $7 $6 $5 $4 $3 $2 $1 $0 Reticulation & Pumps Treatment 3 Yr Rolling Avg. Depreciation 2018/ / / / / / / / / /46 Figure 32: Thirty Year Projected Renewals Expenditure Proposed New Capital Expenditure Figure shows the thirty year projected new capital expenditure, broken down into major asset groups. The capital expenditure profile is dominated by the assumed spending of in excess of $100M over the three years from 2023/24 to 2026/27 to fund the required upgrade in the treatment and disposal facility. The timing and profile of capital funding is indicative only as the preferred option has not yet been selected and the final scope of work is still subject to a consent process. Apart from the treatment facility, the other capital expenditure is associated with investment in new network and pumping facilities to serve new residential and industrial growth areas. The timing and scale of new network investment is subject to review as the rate and nature of development changes. It is intended that by requiring the use of low pressure sewer systems in several growth areas that capital investment costs will be reduced compared to conventional gravity and network pumping systems. 114

131 Section 9 Financial Projections & Trends $45 Treatment Reticulation & Pumps $40 $35 $30 $25 $20 $15 $10 $5 $0 2018/ / / / / / / / / /46 Proposed Capital Expenditure [Millions] Figure 33: Thirty Year Projected New Capital Expenditure A full breakdown of the thirty year projected costs is given in Appendix E Trends in Thirty Year Forecast Significant trends for the thirty year forecast are: Operation and Maintenance Operation and maintenance costs are expected to increase from the major upgrade that will occur at the WWTP. This will be offset to a certain extent by efficiency gains from the new equipment, and anticipated reductions in wastewater flows from I&I. Renewals and Rehabilitation The renewal expenditure is higher for the first 15 years (2018/19 to 2031/32) due to renewals of some critical elements at the Totara Road WWTP, including inlet pumps and grit removal and continuing high levels of pipe renewals. Renewal expenditure then drops to a lower level in the second half of the plan. The total expenditure is $125.2M over the next 30 years. Capital Expenditure The capital expenditure profile is dominated by the assumed investment in an upgrade of the wastewater treatment and disposal system arising out of the consent renewal process. Expenditure is assumed to occur over the period 2023/24 to 2026/27. Other expenditure is largely associated with providing for growth. The total expenditure is $121.6M over the 30 year period. 9.2 Asset Valuation Council Wastewater assets were re-valued as at 30 June 2017 in accordance with Financial Reporting Standard (FRS) 3 and the NZ Infrastructure Valuation Guidelines. The results of this valuation were 115

132 Section 9 Financial Projections & Trends independently audited. The updated valuations at 1 July 2017 are shown in Table 39. The detailed valuation and valuation methodology are contained in the City Networks Valuation Report. Table 39: Asset Valuations 2017 Asset ORC ODRC Annual Depreciation Pipelines $138,594, $72,567, $1,245, Manholes $30,312, $18,492, $252, Laterals $68,948, $29,636, $755, Valves $570, $517, $11, Pump Stations $6,037, $3,609, $145, Treatment Plant $44,816, $29,258, $795, Oxidation Ponds $1,368, $1,202, $5, Total $290,648, $155,282, $3,210, Confidence levels The confidence in the asset data used as a basis for the financial forecasts has been assessed using the following grading system shown in Table 40, from the NZWWA NZ Guidelines for Infrastructure Asset Grading Standards, final draft, August Table 40: Confidence Grading System Confidence Grade Description Processes Asset Data 5 Highly reliable/ Audited 4 Reliable/ Verified Strictly formal process for collecting and analysing data. Process is documented and always followed by all staff. Process is recognised by industry as best method of assessment. Strong process to collect data. May not be fully documented but usually undertaken by most staff. Very high level of data confidence. Data is believed to be 95 to 100% complete and ±5% accurate. Regular data audits verify high level of accuracy in data received. Good level of data confidence. Data is believed to be 80 to 95% complete and ±10 to 15% accurate. Some minor data extrapolation or assumptions has been applied. Occasional data audits verify reasonable level of confidence. 3 Less Reliable Process to collect data established. May not be fully documented but usually undertaken by most staff. 2 Uncertain Semiformal process usually followed. Poor documentation. Process to collect data followed about half the time. Average level of data confidence. Data is believed to be 50 to 80% complete and ±15 to 20% accurate. Some data extrapolation has been applied based on supported assumptions. Occasional data audits verify reasonable level of confidence. Not sure of data confidence, or data confidence is good for some data, but most of dataset is based on extrapolation of incomplete data set with unsupported assumptions. 1 Very uncertain Ad hoc procedures to collect data. Minimal or no process documentation. Process followed occasionally. Very low data confidence. Data based on very large unsupported assumptions, cursory inspection and analysis. Data may have been developed by extrapolation from small, unverified data sets. 0 No data No process exists to collect data. No data available. Table 41 summaries the data confidence rating for the various asset groups. Wastewater asset data that is stored in IPS and GIS is routinely updated and generally has reliable physical characteristics for pipeline assets. The confidence level is B overall. 116

133 Section 9 Financial Projections & Trends Table 41: Confidence Rating Wastewater Assets Asset Asset Data Confidence Condition Data Confidence Performance Data Confidence Demand/Growth Forecast Confidence Pipelines Manholes Laterals Valves Pump Stations Treatment Plant Oxidation Ponds Reliability of financial forecasts Maintenance and Renewal Forecasts These are considered reliable estimates, based on a known quantum and scope of work, and a good historical cost database. There is some increasing uncertainty of forecasts over the long term due to lack of knowledge about real price changes of individual components Development Forecasts Years the scope and pricing of work is considered reliable. Years increasing uncertainty around scope and detail of work, forecast estimates are considered conservative but are less reliable than years 1-3. Years rough order costing based on estimated quantum of work, forecasts could change significantly with further investigation Potential Effects of Uncertainty Generally expenditure forecasts are considered conservative. The longer term development budgets will be refined both in scope and costing as these programmes get closer to implementation. Those programmes that are for growth also form the basis for development contributions assessed over a period of thirty years. Periodic revision and adjustment to the schedule of works in the three year rolling programme counters any negative effect of uncertainty of the financial forecasts. Overall, the continuation of the wastewater level of service to the community is not overly sensitive to changes in particular programmes. Should the required level of funding not be available, there is a potential risk of deferred maintenance or renewal or development. This would not be noticeable immediately, but could build up over a period of time and result in not meeting agreed levels of service. This is mitigated through an extensive review and revision of asset management requirements that takes place on a three yearly cycle, enabling corrective action to be taken before a substantial backlog is built up. Significant development projects that have a high level of uncertainty include: 117

134 Section 9 Financial Projections & Trends The timing of urban growth beyond the immediate area, of Whakarongo. This includes the later stages of programme 1055 Urban Growth Waste Water Supply for City West from 2024/25 onwards. The timing of growth in the expanded NEIZ. The Totara Road WWTP Consent Renewal Upgrade. 9.5 Funding policy The focus of this AMP is on identifying the optimum (lowest lifecycle) cost for wastewater assets necessary to produce the desired level of service. The different types of expenditure are funded as follows: Operation and maintenance Funded by trade waste fees and charges and targeted rates, depending on how the benefits of the activity are assessed - as a public or private benefit - or where costs can be attributed to an individual entity. Trade waste charges are calculated on a flow and load proportional basis in accordance with the Council s Trade Waste Bylaw. Targeted rates for the wastewater activity are calculated as a fixed charge per separately used or inhabited part for residential properties, and for all other properties, a fixed charge per rating unit Capital renewal Funded from trade waste fees and charges, rates revenue collected to cover renewal costs and loan finance if necessary Capital development Funded from subsidies and grants (where available), user contributions, reserves and, where necessary, from borrowing. Subsidies and grants relate to Central Government funding contributions towards the cost of wastewater capital upgrades, and research into new innovations involving sustainable treatment of wastewater by-products (e.g. sludge). There is currently no Central Government funding available for wastewater capital renewal works Development contributions Through the application of its Development Contributions Policy, the Council seeks to obtain contributions to fund the infrastructure that is required due to City growth. Programmes that are attributable to growth are shown in this AMP (See TABLE 25 Appendix E). Development contributions for wastewater are area specific. 118

135 Section 10 Assumptions 10 Assumptions This section sets out the key assumptions made in developing the asset lifecycle programmes and financial forecasts, and identifies the likelihood and impact of variations from these assumptions Asset Ownership and Provision of Service Asset ownership and provision of service remains in Council ownership and management Population Growth The following population projections are assumed: 10-year projection , 940 people per annum at 1.0%. 20 year projection , 710 people per annum at 0.7%. 30 year projection , 598 people per annum at 0.6%. This is a hybrid growth scenario based on a specific Palmerston North high growth projection for years 1-10, and a Statistics New Zealand medium growth projection for years The AMP is formally reviewed every 3 years, and programmes will be adjusted on an annual basis through the Annual Budget for variances from that assumed. There is a low risk that planning for capital development projects for growth will not match actual needs Residential Growth The development scenario for residential growth is based on meeting the needs of a growing population, and also includes the additional margins required by the National Policy Statement for Urban Development Capacity. An average household size of 2.5 is assumed. A future housing preference of 50% for greenfield, 38% for infill and 12% for rural / residential is assumed. The assumed development scenario is based on greenfield development being centred on Whakarongo, Aokautere, and Kelvin Grove, with a number of other smaller developments in the short to medium term, with City West and further Aoukautere development in the medium to longer term. Any changes to this scenario will be worked through subsequent AMPs Industrial Growth It is assumed that the NEIZ and the NEIZ Extension Area will be sufficient to meet the growth in large floor plate industrial activity over the next 20 to 30 Years. Longburn is viewed as a suitable location for wet industry, although there are infrastructure constraints at the moment to its development due to its private ownership. It is assumed these will be resolved to fully realise its potential. 119

136 Section 10 Assumptions Given that the nature of industrial investment can be lumpy, on-going review of industrial land uptake and needs will be required Retail Growth A Centre s based approach is assumed for managing retail and office activity throughout the city. This approach seeks to keep commercial activity centred in the core of the city and to avoid the dispersion of office and retail activity to the periphery of the urban area. This approach is given effect to through the District Plan hierarchy of business zones as follows: Inner Business Zone (IBZ). Outer Business Zone (OBZ). Fringe Business Zone (FBZ). Local Business Zone (LBZ) Rural-Residential Growth It is assumed that the Council generally will not provide a water or wastewater service to ruralresidential and rural properties within the City boundary. It is assumed rural-residential subdivision will occur in locations which do not require the Council to fund substantial upgrades to the wastewater network in order to facilitate the subdivision Levels of Service Generally a similar level of service to that currently delivered applies, but with minor adjustments as follows: Increased education funding. Increased investigations into I&I. Increased wastewater pipe renewals to effect I&I reductions. Further levels of service changes may occur during this period. Cost implications and updating to the AMP will be made at the time they occur Construction Costs Financial forecasts are based on projected July 2018 construction costs. It is likely that the price of some components will change relative to others. Budgets are reassessed each year during the Annual Budget process to mitigate this risk. BERL inflation factors applied to the 10 Year Plan also incorporate an element of price changes in different activity sectors Maintenance & Operational Costs These are largely based on historical rates and assume similar contract rates throughout the planning period. 120

137 Section 10 Assumptions Inflation factors will be applied at the 10 Year Plan level to reflect forecast price changes in different sectors Inflation Financial projections are based on July 2018 estimated costs. No inflation factors have been applied. BERL inflation factors will be applied to the programmes and budgets in the 10 Year Plan. Budgets for successive years of the Annual Budget are based on the corresponding year of the 10 Year Plan Depreciation Average asset lives at a project level for new works have been used to calculate depreciation. New works are a small percentage of total depreciation. Differences from actual due to averaging of lives are relatively minor Vested Assets On average the same level of assets are gifted to the council as a result of subdivision as has occurred over the last 5 years N.B. The rate of change of development will be taken account of in future revisions of the AMP and subsequent operations and maintenance, and depreciation taken into account Service Potential Service potential of the asset is maintained by the renewal programme. There is low risk that the service potential of the asset will not be maintained by implementation of the renewal programme, since this is based on reliable asset and condition information from the asset management system Asset Lives Asset lives are accurately stated. The risk that lives are inaccurate is low. Lives are based on generally accepted industry values modified by local knowledge. The asset database gives a good knowledge of asset condition, and an extensive field assessment has recently been undertaken Natural Disasters There are no major natural disasters requiring additional funds. 121

138 Section 10 Assumptions There is medium risk of a natural disaster occurring during this period, requiring additional funds to repair or reinstate assets. Some further provision for increasing the resilience of the assets has been built into this plan but there is still further work to be undertaken to determine the desired level of resilience and the further asset improvements to achieve this Council Policy No significant change to Council policy that impacts on assets and services. Any significant change will require a full review of the AMP and implications identified at the time Interest Rate An interest rate of 5.7% p.a. is used for debt on new work Treatment Plant Upgrade That no major expenditure is required for a higher level of wastewater discharge quality other than that already identified by the Council before any upgrade associated with the new consent to be applied for in

139 Section 11 Continuous Improvement 11 Continuous Improvement 11.1 Overview The quality of Council s AM practice has been enhanced over the past 20 years in line with the objective to match, but not lead, industry 'best practice' in New Zealand. This version of the AMP incorporates the following key improvements and changes undertaken over the last three years: 11.2 Programme Planning and Implementation A Programme Planning and Implementation Template (PPI) was introduced in 2015 by the City Networks Unit as part of an initiative to improve the quality of information associated with Council infrastructural programmes, including the 30 year programmes in the AMPs The PPI sheet is completed for every infrastructural programme and includes information about type, timing, and scope of programme, options considered, Council decisions, estimated costs, risks, assumptions and constraints, and approvals required for the programme to be implemented. These files also contain links to other relevant reports. The information is updated annually. As a result the information behind the programmes in this plan is more robust than previously Project Status A system for monitoring the progress and expenditure of individual programmes through the financial year has been implemented during the last 3 years to aid better monitoring and management of programmes. This allows projects to be tracked against budget and forecasts, and to record the progress being made. An advantage of this is that the information is widely accessible, with a number of different reports available for different audiences Development Works Planning Residential Growth and Industrial Growth Planning (refer to Section 5) Council s Residential Growth Strategy was adopted on 30 September In October 2011, Council authorised the preparation of a proposed District Plan change to give effect to the Residential Growth Strategy within the District Plan. Development works included in the 2014 AMP to meet growth were based on the 2010 Residential Growth Strategy adjusted by a 2012 Addendum that identified the Whakarongo area as preceding City West for residential development. A further modification of this strategy is now included in this plan to incorporate a higher projected growth forecast, and also takes into account the NPS-UDC requirements. 123

140 Section 11 Continuous Improvement Demand Projections (refer to AMP Section 5) As a result of further analysis of migration trends, the Council has decided to assume high growth projections for years 1-10 and a medium growth projection for years This is greater than the growth assumed for the 2014 AMP, which was based on Statistics New Zealand medium growth projections adjusted for the local Palmerston North situation Risk and Resilience (refer to AMP Section 7) The risk and resilience assessment aligns with the new Local Government Act 2002 Amendment Act 2014 requirement for 30 year infrastructure strategies to identify and manage risks relating to natural hazards and to make appropriate financial provision for those risks. Since the 2014 AMP further work has been undertaken with a review of risks facing the assets, a review of Business Continuity plans, and of Lifelines interdependencies Council Strategies (refer to AMP Section 3) As part of the 10 Year Planning process, the Council has reviewed its Vision, Goals, and Strategies to ensure it is achieving the outcomes it desires for the community. The infrastructure elements of the Strategy Plans associated with Council s goals have been incorporated into these AMPs Renewal Works Planning Condition Data Asset age, condition, performance, and risk are the four main determinants of renewals planning. Ongoing condition and performance assessment of Council s assets has taken place during the period. The data collected is fundamental to improved renewal programming. Predictive modelling is still in its early stages and provision has been included in this Improvement Plan for development of this aspect of asset management see Task 2(g) Operations and Maintenance Operations and Maintenance Strategy The operations and maintenance strategy and processes have been reviewed in conjunction with development of this Plan Internal Service Level Agreements Internal service level agreements between the City Networks Unit and the City Enterprises Unit, the inhouse service provider, have continued to be advanced to increase transparency and accountability between funding and service provision. This has been aided by establishing an SLA system looked after by a dedicated officer. This has been supported by a Collaborative Working Practices process between the two Units. 124

141 Section 11 Continuous Improvement Market Comparability Procedure In conjunction with collaborative working practices, a market comparability procedure is built into the Service Level Agreement process. This is to ensure that the prices being accepted by City Networks reflect the market price. Some improvement has taken place over the past 3 years in this procedure but it still requires further improvement to get the full benefit of this approach. Further work is identified in this Improvement Plan (Task 9(b)) Asset Information Asset Management Plan Improvement The AMP Policy and Strategy was reviewed in October 2016 and presented to PNCC Management Team in February This has been incorporated in the 2017 AMPs. A set of AMP guidelines and programme was prepared at the same time to assist the asset managers in the development of the 2017 AMPs. This identified the context and issues that needed to be addressed to enable the AMPs to be completed and aligned with development of the Year Plan. The programme included a Level of Service review, incorporation of Council Strategies into the AM planning process, development of capital (new and renewal) and operational programmes, and an independent peer review. AMP templates and guidelines were prepared to coordinate the AMP structure and content, and to improve consistency between different AMPs. The AMP financials were constructed within Council s corporate 10 Year Planning system to ensure consistency with the Year Plan projections Asset Management Resources Loss of Key AM Knowledge Key systems to preserve asset management knowledge are the Asset Management Systems and the Programme Planning and Implementation template system that keeps track of information connected with particular programmes. These have both been strengthened during this period Skill Gaps Skill gaps are identified through regular performance development interviews of asset management officers. AM skills and knowledge development can be largely addressed through attendance of AM staff at NAMS training courses and other on line courses Levels of Service Review A review of current levels of service and performance measures was work-shopped with the Council in March Feedback from the workshop was assessed by senior managers and has been factored into projects and programmes, included in this AMP. Further levels of service information came through from Councillors during the LGA s17a process, and also during the development of Council s Strategy Plans. 125

142 Section 11 Continuous Improvement AMP Improvement Plan (2017) The purpose of the Improvement Plan is to: Identify and develop implementation of AMP processes. Identify, programme, and resource measures required to complete studies, or measures to confirm planning assumptions, or to gather information required to improve the reliability / confidence of information used to develop the AMP. Identify and prioritise ways to cost-effectively improve the quality of the AMP. Identify indicative time-scales, priorities, and human and financial resources required to achieve AMP objectives. The following improvement activities have been identified for action over the next 3 years after consideration of priorities identified by the asset management team. Many of these improvements are generic across all asset activities (i.e. water, property, roading, etc.) and will be implemented as coordinated projects across all areas. Capital renewal and development project planning further development of processes to take into account a sustainable development approach. Review demand projections on an on-going basis consistent with Council s Residential Growth Strategy. Continue to develop predictive modelling and risk based approaches to help prioritise renewal programmes and better manage risks and costs in achieving the desired outcomes. Update City-wide asset development plans as growth and actual development necessitates Periodically review risk assessments. Further develop appropriate mitigation strategies for Council s critical assets in the event of a major natural hazard, and programmes to improve resilience of critical assets from natural hazards. Operations and maintenance on-going review of contracting and internal service agreement strategies to achieve the best balance of risk transfer, cost, and performance. Asset information on-going development of systems to meet all asset management needs, and the integration of asset information activities within Council. Internal process improvements for Collaborative Working Practices, Service Procurement processes, and Market Comparability assessments. Level of service undertake stakeholder consultation on new, major issues, to update understanding of community expectations and preferences. Review levels of service with Council every three years. AM resource planning to ensure the recruitment, retention, and development of sufficient and suitably qualified staff. Review AM strategy to take account of changes in Council direction and Government policy. The indicative AM improvement programme is detailed in Table

143 Resources 2017/ / / / Section 11 Continuous Improvement Table 42: Palmerston North City Council 3 Year Asset Management Improvement Programme AM Category Improvement Activities Timeframe & Responsibility Est($) J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J 1 Development works planning (demand/ LoS) Review and update demand projections considering all trends (population, climate, usage, etc.). Understand forecast scenarios. 2 weeks City Networks /City Future 8,000 Review impact of Council's strategies and policies on demand projections. 1 week Asset Managers 4,000 Review development plans for assets. 2 weeks AMP Coordinator 8,000 Review project priorities based on risk/cost/benefit analysis. 2 weeks Asset Managers 8,000 Review mitigation strategies for major natural hazard events. 3 weeks Asset Managers 20,000 Document changes to AMP programmes that arise through 10 Year Plan & AP processes. 2 weeks Asset Managers 10,000

144 Resources 2017/ / / /21 Section 11 Continuous Improvement AM Category Improvement Activities Timeframe & Responsibility Est($) J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J 2 Asset information Review AM system data quality processes and improve as required. Develop Data Improvement Plan. Link with Task 3(a). 2 weeks Asset Managers & AM Coord. 10,000 Review and document condition assessment quality process/ programme (to support risk & predictive modelling). 2 weeks Asset Managers 10,000 Review performance data needs (reporting & decision-making) and document data capture quality process. 2 weeks Asset Managers 8,000 Analyse asset lives (using condition/ capacity/ performance data), and review / address data quality issues. Enter into AM system. 1 week Asset Managers & System Officers 4,000 Review/Identify critical assets in the register. 1 week Asset Manager 4,000 Review financial data needed to support ODM and valuationimplement process. 2 weeks Asset Managers 8,

145 Resources 2017/ / / / Section 11 Continuous Improvement AM Category Improvement Activities Timeframe & Responsibility Est($) J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J 2 Asset information Assess advanced AM system needs, and implement suitable application for predictive modelling. 2 weeks Asset System Officer 20,000 Assess future options for development of AM system. 2 weeks Asset System Officer 8,000 Review and update Programme Planning and Implementation (PPI) information in conjunction with AP & 10 Year Plan process. 3 weeks Asset Managers 20,000 Develop user friendly database for the PPI information. 3 weeks Asset Group / IT 20,000 3 Renewal works planning Undertake annual assessment of asset condition, age, and environmental factors to determine residual asset lives (predictive modelling). Annual Asset Managers 15,000 Compile a renewal programme (accounting for condition and renewal profile depreciation) including consequences/risks of budget constraints. 4 weeks Asset Managers 20,000

146 Resources 2017/ / / /21 Section 11 Continuous Improvement AM Category Improvement Activities Timeframe & Responsibility Est($) J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J 3 Renewal works planning Develop and action processes to identify and prioritise risk mitigation options (ODM). Prepare renewal programme. 3 weeks Asset Managers 10,000 4 Operations and maintenance Document O&M strategy and O&M processes for optimising programmes (benefit/ cost approach). 1 week Asset Managers 4,000 Review processes to ensure that competitive prices are obtained for services delivered, and that there is the correct balance between risk transfer, performance orientation and costs. (SLA comparability, core market data, schedules of prices.) 2 weeks Asset Managers 8,000 Detailed review of resource inputs to operation and maintenance activities. 3 weeks Manager 20,000 5 Asset management improvement Establish an Asset Management Coordinating Group to drive improvement plan & next AMP over the next 3yrs. AMP Coordinator 3,000 Establish annual management review meetings to consider AM performance AMP Coord/ Activity Manager 130

147 Resources 2017/ / / / Section 11 Continuous Improvement AM Category Improvement Activities Timeframe & Responsibility Est($) J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J Develop overall AM strategy leading up to next AM review and get adopted by MT. 2 weeks AMP Coordinator 8,000 5 Asset management improvement Develop a process for regular review of risk. 1 week AMP Coordinator 5,000 Develop and enhance measures for resilience of critical assets to natural hazards. 3 weeks AMP Coordinator 5,000 Develop and implement process to ensure that there is better integration between all AMPs. 1 week AMP Coordinator 4,000 Develop KPIs to monitor progress with the Improvement Plan. 2 days AMP Coordinator 1,000 6 Asset management staff resources Adopt succession planning process to minimise risks relating to loss of key staff knowledge. 1 week Networks MT 4,000

148 Resources 2017/ / / /21 Section 11 Continuous Improvement AM Category Improvement Activities Timeframe & Responsibility Est($) J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J Skill gaps in AM are assessed and training programmes implemented to close any identified gaps. 1 week Roading Manager 12,000 6 Asset management staff resources Promote organisational understanding of AM practices and outcomes. 2 weeks AMP Coordinator 10,000 7 Level of service review Review LoS strategy and programme. 2 weeks AMP Coordinator 10,000 Undertake consultation on major issues, case by case. 10 weeks 50,000 Undertake LoS Review with Council. AMP Coordinator / Asset Managers 30,000 8 Update AMP AMP Maturity Assessment and identification of key focus areas for 2021 Plans. AMP Coordinator / Asset Managers 12,

149 Resources 2017/ / / / Section 11 Continuous Improvement AM Category Improvement Activities Timeframe & Responsibility Est($) J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J Prepare AMP using outputs of this improvement programme and incorporate further recommendations from the 2017 Peer Review & Audit NZ into the Plan. 16 weeks Asset Managers 30,000 8 Update AMP Update AMP programme and financials. 4 weeks Asset Managers 16,000 Improve internal processes of CWP. SLA system and Market Comparability as required. Special Projects Manager 15,000

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153 Appendix A Glossary Appendix A. Glossary 137

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155 Appendix A Glossary The following terms and acronyms (in brackets) are used in this Asset Management Plan. Term / Acronym Activity Advanced Asset Management (AAM) Annual Budget Asset Asset Management (AM) Asset Management System (AMS) Asset Management Plan (AMP) Asset Management Strategy Asset Management Team Asset Register Benefit Cost Ratio (B/C) Business Plan Capital Expenditure (CAPEX) Cash Flow Components Condition Monitoring Core Asset Management Critical Assets Definition An activity is the work undertaken on an asset or group of assets to achieve a desired outcome. Asset management practice that has evolved to a state that matches business needs. AAM employs predictive modelling, risk management and optimised renewal decision making techniques to establish asset lifecycle treatment options and related long term cashflow predictions. (See Core asset management). The Annual Budget provides a statement of the direction of Council and ensures consistency and coordination in both making policies and decisions concerning the use of Council resources. It is a reference document for monitoring and measuring performance for the community as well as the Council itself. A physical component of a facility which has value, enables services to be provided and has an economic life of greater than 12 months. The combination of management, financial, economic, engineering and other practices applied to physical assets with the objective of providing the required level of service in the most cost effective manner. A system (usually computerised) for collecting analysing and reporting data on the utilisation, performance, lifecycle management and funding of existing assets. A plan developed for the management of one or more infrastructure assets that combines multidisciplinary management techniques (including technical and financial) over the lifecycle of the asset in the most cost effective manner to provide a specified level of service. A significant component of the plan is a long term cashflow projection for the activities. A strategy for asset management covering, the development and implementation of plans and programmes for asset creation, operation, maintenance, renewal, disposal and performance monitoring to ensure that the desired levels of service and other operational objectives are achieved at optimum cost. The team appointed by an organisation to review and monitor the corporate asset management improvement programme and ensure the development of integrated asset management systems and plans consistent with organisational goals and objectives. A record of asset information considered worthy of separate identification including inventory, historical, financial, condition, construction, technical and financial information about each. The sum of the present values of all benefits (including residual value, if any) over a specified period, or the life cycle of the asset or facility, divided by the sum of the present value of all costs. A plan produced by an organisation (or business units within it) which translate the objectives contained in an Annual Budget into detailed work plans for a particular, or range of, business activities. Activities may include marketing, development, operations, management, personnel, technology and financial planning Expenditure used to create new assets or to increase the capacity of existing assets beyond their original design capacity or service potential. CAPEX increases the value of an asset. The stream of costs and/or benefits over time resulting from a project investment or ownership of an asset. Specific parts of an asset having independent physical or functional identity and having specific attributes such as different life expectancy, maintenance regimes, risk or criticality. Continuous or periodic inspection, assessment, measurement and interpretation of resulting data, to indicate the condition of a specific component so as to determine the need for some preventive or remedial action Asset management which relies primarily on the use of an asset register, maintenance history, condition assessment, defined levels of service, and simple risk and benefit/ cost assessments in order to establish work priorities and long term cashflow predictions. Assets for which the financial, business or service level consequences of failure are sufficiently severe to justify proactive inspection and rehabilitation. Critical assets have a lower threshold for action than non-critical assets. 139

156 Appendix A Glossary Term / Acronym Current Replacement Cost Deferred Maintenance Demand Management Depreciated Replacement Cost (DRC) Depreciation Disposal Economic Life Facility Geographic Information System (GIS) I&I Infrastructure Assets Level Of Service Life Life Cycle Life Cycle Cost Maintenance Maintenance Plan Maintenance Standards Net Present Value (NPV) Definition The cost of replacing the service potential of an existing asset, by reference to some measure of capacity, with an appropriate modern equivalent asset. The shortfall in rehabilitation work required to maintain the service potential of an asset. The active intervention in the market to influence demand for services and assets with forecast consequences, usually to avoid or defer CAPEX expenditure. Demand management is based on the notion that as needs are satisfied expectations rise automatically and almost every action taken to satisfy demand will stimulate further demand. The replacement cost of an existing asset after deducting an allowance for wear or consumption to reflect the remaining economic life of the existing asset. The wearing out, consumption or other loss of value of an asset whether arising from use, passing of time or obsolescence through technological and market changes. It is accounted for by the allocation of the historical cost (or revalued amount) of the asset less its residual value over its useful life. Activities necessary to dispose of decommissioned assets. The period from the acquisition of the asset to the time when the asset, while physically able to provide a service, ceases to be the lowest cost alternative to satisfy a particular level of service. The economic life is at the maximum when equal to the physical life however obsolescence will often ensure that the economic life is less than the physical life. A complex comprising many assets (e.g. a hospital, water treatment plant, recreation complex, etc.) which represents a single management unit for financial, operational, maintenance or other purposes. Software which provides a means of spatially viewing, searching, manipulating, and analysing an electronic data-base. Infiltration and Inflow. Stationary systems forming a network and serving whole communities, where the system as a whole is intended to be maintained indefinitely at a particular level of service potential by the continuing replacement and refurbishment of its components. The network may include normally Recognised ordinary assets as components. The defined service quality for a particular activity (i.e. roading) or service area (i.e. street-lighting) against which service performance may be measured. Service levels usually relate to quality, quantity, reliability, responsiveness, environmental acceptability and cost. A measure of the anticipated life of an asset or component; such as time, number of cycles, distance intervals etc. Life cycle has two meanings: The cycle of activities that an asset (or facility) goes through while it retains an identify as a particular asset i.e. from planning and design to decommissioning or disposal. The period of time between a selected date and the last year over which the criteria (e.g. costs) relating to a decision or alternative under study will be assessed. The total cost of an asset throughout its life including planning, design, construction, acquisition, operation, maintenance, rehabilitation and disposal costs. All actions necessary for retaining an asset as near as practicable to its original condition, but excluding rehabilitation or renewal. Collated information, policies and procedures for the optimum maintenance of an asset, or group of assets. The standards set for the maintenance service, usually contained in preventive maintenance schedules, operation and maintenance manuals, codes of practice, estimating criteria, statutory regulations and mandatory requirements, in accordance with maintenance quality objectives. The value of an asset to the organisation, derived from the continued use and subsequent disposal in present monetary values. It is the net amount of discounted total cash inflows arising from the continued use and subsequent disposal of the asset after deducting the value of the discounted total cash outflows. 140

157 Appendix A Glossary Term / Acronym Objective Operation Optimised Renewal Decision Making (ORDM) Performance Indicator (PI) Performance Monitoring Pipeline Asset Management System Planned Maintenance Rehabilitation Renewal Renewal Accounting Repair Replacement Remaining Economic Life Risk Cost Risk Management Routine Maintenance Service Potential Sewage Sewerage Definition An objective is a general statement of intention relating to a specific output or activity. They are longer term aims and are not necessarily outcomes that managers can control. The active process of utilising an asset which will consume resources such as manpower, energy, chemicals and materials. Operation costs are part of an assets life cycle costs.. An optimisation process for considering and prioritising all options to rectify performance failures of assets. The process encompasses NPV analysis and risk assessment. A qualitative or quantitative measure of a service or activity used to compare actual performance against a standard or other target. Performance indicators commonly relate to statutory limits, safety, responsiveness, cost, comfort, asset performance, reliability, efficiency, environmental protection and customer satisfaction. Continuous or periodic quantitative and qualitative assessments of the actual performance compared with specific objectives, targets or standards. The computerised utilities asset management software system (IPS) supplied by Infor. Planned maintenance activities fall into 3 categories : Periodic - necessary to ensure the reliability or sustain the design life of an asset. Predictive - condition monitoring activities used to predict failure. Preventive - maintenance that can be initiated without routine or continuous checking (e.g. using information contained in maintenance manuals or manufacturers recommendations) and is not condition-based. Works to rebuild or replace parts or components of an asset, to restore it to a required functional condition and extend its life, which may incorporate some modification. Generally involves repairing the asset using available techniques and standards to deliver its original level of service (i.e. heavy patching of roads, slip-lining of sewer mains, etc.) without resorting to significant upgrading or replacement. Works to upgrade, refurbish, rehabilitate or replace existing facilities with facilities of equivalent capacity or performance capability. A method of infrastructure asset accounting which recognises that infrastructure assets are maintained at an agreed service level through regular planned maintenance, rehabilitation and renewal programmes contained in an asset management plan. The system as a whole is maintained in perpetuity and therefore does not need to be depreciated. The relevant rehabilitation and renewal costs are treated as operational rather than capital expenditure and any loss in service potential is recognised as deferred maintenance. Action to restore an item to its previous condition after failure or damage. The complete replacement of an asset that has reached the end of its life, so as to provide a similar, or agreed alternative, level of service. The time remaining until an asset ceases to provide service level or economic usefulness. The assessed annual cost or benefit relating to the consequence of an event. Risk cost equals the costs relating to the event multiplied by the probability of the event occurring. The application of a formal process to the range of possible values relating to key factors associated with a risk in order to determine the resultant ranges of outcomes and their probability of occurrence. Day to day operational activities to keep the asset operating (replacement of light bulbs, cleaning of drains, repairing leaks, etc.) and which form part of the annual operating budget, including preventative maintenance. The total future service capacity of an asset. It is normally determined by reference to the operating capacity and economic life of an asset. Water or other liquid, including waste matter in solution or suspension, discharged from a premise. System of pipes, pump stations and pressure mains constructed to transport sewage from each premise to the point of sewage treatment or discharge. 141

158 Appendix A Glossary Term / Acronym Sewer Strategic Plan Trade Waste Unplanned Maintenance Upgrading Valuation Definition Piped sewerage asset through which sewage conveyed. Public sewer; the section of sewer downstream of the point of discharge which is owned and maintained by Council. Private sewer / private drain (or lateral); the section of sewer between the customer s premises and the point of discharge through which sewage is conveyed from the premises. This section of drain is owned and maintained by the customer. Strategic planning involves making decisions about the long term goals and strategies of an organisation. Strategic plans have a strong external focus, cover major portions of the organisation and identify major targets, actions and resource allocations relating to the long term survival, value and growth of the organisation. Discharge is any liquid, with or without matter in suspension of solution, that is or may be discharged from trade premises in the course of any trade or industrial process or operation Corrective work required in the short term to restore an asset to working condition so it can continue to deliver the required service or to maintain its level of security and integrity. The replacement of an asset or addition/ replacement of an asset component which materially improves the original service potential of the asset. Estimated asset value which may depend on the purpose for which the valuation is required, i.e. replacement value for determining maintenance levels or market value for life cycle costing. 142

159 Appendix B Requirements of the LGA 2002 Appendix B. Requirements of the LGA

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161 Appendix B Requirements of the LGA 2002 Section 101B from the LGA 2002 Amendment Act 2014 and LGA Schedule 10 outline the information to be included in 10 Year Plans. Much of this information is provided through asset management plans. LGA Section 101B Infrastructure Strategy 101B Infrastructure strategy (1) A local authority must, as part of its long-term plan, prepare and adopt an infrastructure strategy for a period of at least 30consecutive financial years. (2) The purpose of the infrastructure strategy is to (a) (b) identify significant infrastructure issues for the local authority over the period covered by the strategy; and identify the principal options for managing those issues and the implications of those options. (3) The infrastructure strategy must outline how the local authority intends to manage its infrastructure assets, taking into account the need to (a) (b) (c) (d) (e) renew or replace existing assets; and respond to growth or decline in the demand for services reliant on those assets; and allow for planned increases or decreases in levels of service provided through those assets; and maintain or improve public health and environmental outcomes or mitigate adverse effects on them; and provide for the resilience of infrastructure assets by identifying and managing risks relating to natural hazards and by making appropriate financial provision for those risks. (4) The infrastructure strategy must outline the most likely scenario for the management of the local authority s infrastructure assets over the period of the strategy and, in that context, must (a) show indicative estimates of the projected capital and operating expenditure associated with the management of those assets (i) (ii) in each of the first 10 years covered by the strategy; and in each subsequent period of 5 years covered by the strategy; and (b) identify (i) (ii) the significant decisions about capital expenditure the local authority expects it will be required to make; and when the local authority expects those decisions will be required; and 145

162 Appendix B Requirements of the LGA 2002 (iii) (iv) for each decision, the principal options the local authority expects to have to consider; and the approximate scale or extent of the costs associated with each decision; and (c) include the following assumptions on which the scenario is based: (i) (ii) (iii) the assumptions of the local authority about the life cycle of significant infrastructure assets: the assumptions of the local authority about growth or decline in the demand for relevant services: the assumptions of the local authority about increases or decreases in relevant levels of service; and (d) if assumptions referred to in paragraph (c) involve a high level of uncertainty, (i) (ii) identify the nature of that uncertainty; and include an outline of the potential effects of that uncertainty. (5) A local authority may meet the requirements of section 101A and this section by adopting a single financial and infrastructure strategy document as part of its long-term plan. (6) In this section, infrastructure assets includes (a) existing or proposed assets to be used to provide services by or on behalf of the local authority in relation to the following groups of activities: (i) (ii) (iii) (iv) (v) water supply: sewerage and the treatment and disposal of sewage: stormwater drainage: flood protection and control works: the provision of roads and footpaths; and (b) any other assets that the local authority, in its discretion, wishes to include in the strategy. 146

163 Appendix B Requirements of the LGA 2002 Extract from LGA Schedule 10 Part 1 Information to be included in long-term plans 1 Community outcomes A long-term plan must, to the extent determined appropriate by the local authority, describe the community outcomes for the local authority s district or region. 2 Groups of activities (1) A long-term plan must, in relation to each group of activities of the local authority, (a) (b) (c) identify the activities within the group of activities: identify the rationale for delivery of the group of activities (including the community outcomes to which the group of activities primarily contributes): outline any significant negative effects that any activity within the group of activities may have on the local community: (d) include the information specified in clauses 4 and 5 (i) (ii) in detail in relation to each of the first 3 financial years covered by the plan; and in outline in relation to each of the subsequent financial years covered by the plan. (2) In this schedule, each of the following activities is a group of activities: (a) (b) (c) (d) (e) water supply: sewerage and the treatment and disposal of sewage: stormwater drainage: flood protection and control works: the provision of roads and footpaths. (3) Despite subclause (2), a local authority may treat any other activities as a group of activities. 3 Capital expenditure for groups of activities (1) A long-term plan must, in relation to each group of activities of the local authority and for each financial year covered by the plan, include a statement of the amount of capital expenditure that the authority has budgeted to (a) (b) meet additional demand for an activity; and improve the level of service; and 147

164 Appendix B Requirements of the LGA 2002 (c) replace existing assets. (2) For the purpose of this clause, capital expenditure budgeted for 2 or all of the purposes in subclause (1) may be treated as if it were made solely in relation to the primary purpose of the expenditure. 4 Statement of service provision A long-term plan must, in relation to each group of activities of the local authority, include a statement of the intended levels of service provision that specifies (a) (b) (c) (d) (e) any performance measures specified in a rule made under section 261B for a group of activities described in clause 2(2); and the performance measures that the local authority considers will enable the public to assess the level of service for major aspects of groups of activities for which performance measures have not been specified under paragraph (a); and the performance target or targets set by the local authority for each performance measure; and any intended changes to the level of service that was provided in the year before the first year covered by the plan and the reasons for the changes; and the reason for any material change to the cost of a service. 5 Funding impact statement for groups of activities (1) A long-term plan must, in relation to each year covered by the plan, include a funding impact statement in relation to each group of activities of the local authority. (2) The funding impact statement must be in the prescribed form and must identify (a) (b) (c) the sources of funding to be used by the local authority; and the amount of funds expected to be produced from each source; and how the funds are to be applied. 148

165 Appendix C Technical Performance Measures Appendix C. Technical Performance Measures 149

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167 <8hr (9.5hr total) <8hr (9.5hr total) <8hr (9.5hr total) 151 Appendix C Technical Performance Measures Table C1: Customer Level of Service, Performance Measures & Targets, & Performance Targets Key Service Criteria Stakeholders and User Groups Customer Level of Service Customer Performance Measure Current Performance Performance Targets 2018/ / / Quality and Health All residents and users. MidCentral Health The Council provides a safe (i.e. no risk to public health) wastewater collection service. Residents are satisfied with the quality of Council s wastewater services. 95% 95% 95% 95% 95% Responsiveness All users The Council responds to requests for service in relation to overflows, blockages and faults in a prompt and efficient way Median response time for resolution of overflows resulting from blockages or other faults. 2.3hrs <8hr (9.5hr total) Accessibility Residential and commercial property owners The Council provides wastewater services to residential and commercial areas of the City Properties (within the wastewater services area) are able to connect to the wastewater service. 100% 99% 99% 99% 99% Sustainability All residents. Horizons Regional Council. Rangitāne Manawatū River Leaders Accord The Council disposes of wastewater to environmentally acceptable standards Number of abatement notices. No non-compliance notices received

168 1/1000 (3 per year) 3/1000 (84 per year) 10 (280 per year) 1 (28 per year) 1 (30 per year) 1/1000 (3 per year) 1/1000 (84 per year) 10 (280 per year) 1 (28 per year) 1 (30 per year) Appendix C Technical Performance Measures Key Service Criteria Stakeholders and User Groups Customer Level of Service Customer Performance Measure Current Performance Performance Targets 2018/ / / Reliability All users The Council provides a reliable wastewater collection service. Odour complaints per 1,000 connections per year /1000 (11 in total) 1/1000 (3 per year) 1/1000 (3 per year) Fault complaints per 1000 connections per year. 2.6/1000 (73 in total) 3/1000 (84 per year) 3/1000 (84 per year) Blockage complaints per 1,000 connections per year. 0.58/1000 (19 total) 10 (280 per year)) 10 (280 per year) Number of complaints about the Council s response to issues with the wastewater system per 1,000 connections per year 0.1/1000 (3 in total) 1/1000 (28 per year) 1 (28 per year) The Council provides a reliable wastewater collection service. The number of dry weather wastewater overflows from the Council s sewerage systems per 1,000 connections per year. Error! Bookmark not defined. 1.1/ due to localised blockages 1 (30 per year) 1 (30 per year) The Council wastewater system is designed to adequate standards and is operated effectively Median response time for attending to overflows resulting from blockages or other faults. 0.4hrs <1.5hr <1.5hr <1.5hr <1.5hr Sustainability (Continued) All residents. Horizons Regional Council. Rangitāne The Council disposes of wastewater to environmentally acceptable standards Number of infringement notices. 16 Number of enforcement orders Mandatory measure from the Department of Internal Affairs 16 Mandatory measure from the Department of Internal Affairs 152

169 153 Appendix B Requirements of the LGA 2002 Key Service Criteria Stakeholders and User Groups Manawatū River Leaders Accord Customer Level of Service Customer Performance Measure Number of convictions received by the Council in relation to resource consents. Current Performance Performance Targets 2018/ / / A 30-year asset management plan is in place for the wastewater activity A 30 year asset management plan prepared, peer reviewed and adopted in September 2018 AMP in place (key projects from AMP will be outlined) Financial Management All wastewater ratepayers The Council manages its wastewater activity in a financially sustainable way Wastewater rates are less than the average of the national peer group. AMP in place (key projects from AMP will be outlined) AMP reviewed (key projects from AMP will be outlined) AMP in place and reviewed 3-yearly with independent peer review (key projects from AMP will be outlined) 100% 100% 100% 100% The Council maintains and develops wastewater services to meet current and future needs Wastewater Capital programme is provided within budget. Achieved Achieved Achieved Achieved The Council manages its wastewater activity in a financially sustainable way Wastewater Operational programme is provided within budget Achieved Achieved Achieved Achieved

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171 Appendix D Risk Analysis/ Framework & Register Appendix D. Risk Analysis/ Framework & Register 155

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173 Appendix D Risk Analysis/ Framework & Register Risk Management Process The adopted City Networks risk management process is consistent with Australian/New Zealand standard AS/NZ 4360 which defines risk assessment and management. Risk Management Context The key risk criteria adopted for City Networks for assessing the consequences of identified risks are: Environmental and legal compliance. Safety & Health. Third Party Property Damage & Losses. Loss of Service- Extent/ duration. PNCC Business Costs Total Recovery. Corporate image. Risk Analysis The likelihood and impact ratings used to determine initial risk ratings are defined in Tables D1 and D2 respectively. Table D1: Risk Probability Ratings Code Descriptor Description (Probability) A Almost Certain The event could occur in most circumstances, e.g. 90% + chance of occurring in the next 12 months (or in 9 out of every 10 years). B Likely The event will probably occur in most circumstances, e.g. 70% chance of occurring in the next 12 months (or in 7 out of every 10 years). C Moderate The event should occur at some time, e.g. 50% chance of occurring in the next 12 months (or in 5 out of every 10 years). D Unlikely The event could occur at some time, e.g % chance of occurring in the next 12 months (or in 2-3 out of every 10 years). E Rare The event may occur only in exceptional circumstances, e.g. up to 10% chance of occurring in the next 12 months (or once in 10 years). F Extremely Rare The event may occur only in extremely exceptional circumstances, e.g. up to 2% chance of occurring in the next 12 months (or once or less in 50 years). 157

174 Appendix D Risk Analysis/ Framework & Register Council prosecuted for minor offence. Minor localised environmental damage. Prosecution possible. Impact fully reversible within three months. Local adverse political comment. Negative national media coverage. Up to two days of Managers time. Public amenity closed for less than one week. Isolated customer complaints. 158 Table D2: Measures of Consequences of Failure Area of Impact Factor Extreme Major Moderate Minor Insignificant Legal Legal Council sued or fined or otherwise liable for more than $20M. Corporate Image Service Delivery Catastrophic environmental damage of national importance. Prosecution. Long term study. Impact permanent. Political Appointment of a Commissioner. Council sued or fined or otherwise liable for $5M - $20M. Serious environmental damage of national importance. Prosecution. Long term study. Impact not fully reversible. Decision-making process breaks down. Image National adverse political comment for one month plus. Councillor/ Management Time Service Delivery Negative international multi media coverage for one month plus. Water supply and sewage out for city for several days plus. Permanent loss of solid waste facility. Negative national multi media coverage for one month plus. Negative international multi media coverage. Water supply and sewage out for two suburbs for one week. Water supply contaminated. Public amenity closed for one month or more. Council sued or fined or otherwise liable for $250K - $5M. Serious environmental damage of national importance. Prosecution expected. Impact reversible within ten years. Council sued or fined or otherwise liable for up to $250K. Serious environmental damage of local importance. Prosecution probable. Impact fully reversible within one year. Council delays decisions. Breakdown in the relationship between Council and staff. Regional adverse political comment for several days. Negative national multi media coverage for several days. Unplanned collective 30 days of Councillors or Managements time. Water supply and/or sewage out for city for one day. Public amenity closed for two weeks or more. Local adverse political comment for one week. Negative national media coverage for two days days of Managers time. Water supply and/or sewage out for two suburbs for one day. Public amenity closed for one week or more. Systematic customer complaints, or complaints relating to more than one occurrence.

175 Appendix D Risk Analysis/ Framework & Register 159 Area of Impact Factor Extreme Major Moderate Minor Insignificant Service Delivery Service Delivery Repeated service standard failure or one that affects multiple people. Financial PNCC Financial Unplanned loss or cost to reinstate of $3.5M or greater Unplanned loss or cost to reinstate between $1.75M- $3.5M. Unplanned loss or cost to reinstate between $1.0M- $1.75M. Unplanned loss or cost to reinstate between $500K- $1.0M. Ongoing loss of $400K pa. Ongoing loss $200K-$400K pa. Ongoing loss $100K-200K pa. Financial Community Financial Catastrophic consequential loss in the community (>$20M) Major consequential loss in the community ($5M-$20M) Significant consequential loss in the community ($1M-$5M) Some consequential loss in the community ($250K-1M) Community Health and Safety Community People in several suburbs ill through contaminated water or similar. People in two-three suburbs ill through contaminated water or similar. People in one suburb ill through contaminated water or similar. Multiple loss of life or citywide epidemic. Loss of life or long-term hospitalisation required. Hospitalisation required. Medical treatment required. Dissatisfaction of community measure needs to be included? Isolated service standard failure. Unplanned loss or cost to reinstate less than $500K. Minimal consequential loss in the community (<$250K) Several people ill through contaminated water or similar.

176 Appendix D Risk Analysis/ Framework & Register Risk Evaluation: The matrix of likelihood and consequence of failure ratings shown in Table D3 below is used to assess the level of risk, ranking events as low, moderate, significant or high risk. Table D3: Risks Priority Rating Matrix Likelihood Consequences A H H C C C B M H H C C C L M H C C D L L M H C E L L M H H F L L L M M This allows all asset and corporate risks to be compared and ranked. The risk policy specifies the following broad treatment strategy for the levels of risk: L = Low Risk: Manage by routine procedures. M = Moderate Risk: Management responsibility must be specified. H = High Risk: Risk & management strategy identified in AMP. Failure management plans available. C = Critical Risk: Risk & management strategy identified in AMP, Failure management plan specifically addressing event in place. 160

177 Appendix D Risk Analysis/ Framework & Register Wastewater Risk Management Framework Overview This Wastewater activity specific risk management planning for Palmerston North City Council (PNCC) will provide the basis for future risk analysis and improvement planning. This section covers the risk management implemented by PNCC and how it applies to current and future wastewater activities. In addition, an overview of risk management theory and practice is provided along with suggested improvements to current practices at the PNCC. Risk management is a process used to identify the specific business risks, together with any possible risks associated with the provision and management of council s wastewater services. This can be used to determine the direct and indirect costs associated with these risks, and form a priority-based action plan to address them. The outcome of this evaluation is to be used to: Emphasize the importance of continuing to provide Council s wastewater services and manage inherent risks Continually identify improvements required to Council wastewater services to avoid risk events, or minimise their impact or to realise identified opportunities. A Risk is defined in AS/NZS ISO 31000:2009 Risk management Principles and guidelines, as: Effect of Uncertainty on Objectives Effect: Deviation from the expected positive or negative. Objectives: Can have different aspects (see Risk Types) and can apply at different levels (see Risk Hierarchy Levels). Risks: Often characterized by reference to potential events and consequences, and is often expressed in terms of a combination of the consequences of an event and the associated likelihood. Uncertainty: The state, even partial, of deficiency of information related to, understanding or knowledge of an event, its consequence, or likelihood. Putting the Risks into Perspective Council policy and operation cannot influence all the factors contributing to these risk events. However, PNCC has a responsibility to assess the risks faced by the wastewater activity in order to best manage the services with the resources available to avoid and mitigate the effects of any event. In the following risk analysis, PNCC has highlighted a number of key risk areas across the activity including: Moderate natural hazards Contract / SLA management Legislative noncompliance Network capacity failure 161

178 Appendix D Risk Analysis/ Framework & Register Network breaks or blockages Treatment plant failure These are discussed in further detail in the Risk Registers and the overall Action Plan contained in this risk section. Levels of Risk The purpose of this risk plan is to identify the risks associated with the provision of wastewater services. This requires approaching the risks from many perspectives including financial, operational, reputational and public health and safety. These risks are pertinent to both a higher, corporate level, and to a more detailed asset specific level, but do not substitute for more specific risk analysis at those levels (see Figure D1 below). The next step beyond this risk analysis is to develop more detailed risk plans where the criticality of specific assets is assessed and an action plan developed as appropriate. Corporate Risk Highest level covering risks for the entire organisation Activity Risk Considers risks from all perspectives affecting the management of the activity and its assets Asset Specific Risks Specific critical asset/ service risks, project risks Figure D1: Risk Hierarchy Levels Risk Types Risks events derive from, or impact in one or more of the following ways. These are identified against each risk in the risk register as risk types. Operational Risks affecting the efficient operation of wastewater system and its ability to function effectively. 162

179 Appendix D Risk Analysis/ Framework & Register Financial/Economic Risks related to the financial management of PNCC and its ability to fund Council services now, and into the future Risks resulting from an externally imposed economic environment. Health and Safety A risk event that adversely impacts on the health and safety of the community or Council staff. Reputation / Image Risks that affect the way Council and staff are perceived: By the community By staff Nationwide and internationally By stakeholders By the media Legislative A risk event that results in PNCC either unknowingly or knowingly breaching statutes and regulations, or being exposed to liability. Environmental Potential or actual negative environmental or ecological impacts, regardless of whether these are reversible or irreversible in nature. Current Situation PNCC s wastewater activity has not undertaken previous risk assessments on the service, but has carried out an asset level risk exercise for inclusion in the asset management plan. Corporate Policy PNCC is seeking to establish a corporate risk policy in place and a Risk and Assurance team, which will have an overview of all risk exposures within the organisation, including corporate, financial, customer, assets. Infrastructure Services staff will contribute regularly to the work of this group. Each risk identified in this plan will be entered into the corporate risk register. Risk Management Process The following sections expand upon the risk management process as identified in the flowchart (Figure overleaf) and detail the key elements of the risk management process. The risk criteria and matrices have been established as the basis for risk evaluation developed in accordance with the AS/NZS ISO 31000:2009 international risk standard. 163

180 Appendix D Risk Analysis/ Framework & Register Identify Risks All practically possible risks affecting the Council should be identified, entered into the risk register and risk types assigned. The register is used to record and summarise each risk and to outline current mitigation measures and potential future options for management of the risk. Determine Likelihood and Consequence for Gross Risk Factor Table and demonstrate the scales used to determine the likelihood and consequence levels, which are then input into the risk matrix to determine the effect of a risk event. Assessment of the likelihood of occurrence and severity of consequences should be based on as much real data as possible, for example local knowledge or recorded events such as maintenance records, weather events etc. Some analysis may be required to verify the data. The likelihood scales identify how likely, or often, a particular event is expected to occur and these are shown in Table D4 below. The descriptors are not mandatory, but are presented as a guide to assist ranking the probability of occurrence in line with the nature of each risk. For example, a risk such as a sewer overflow is considered to be rare if it occurs once every ten years, whereas a tsunami occurring every ten years would be considered frequent. Table D4: Likelihood of Occurrence Risk - Likelihood of Occurrence Likelihood Rating Descriptor Almost Certain A The event could occur in most circumstances, e.g. 90% + chance of occurring in the next 12 months (or in 9 out of every 10 years). Likely B The event will probably occur in most circumstances, e.g. 70% chance of occurring in the next 12 months (or in 7 out of every 10 years). Moderate C The event should occur at some time, e.g. 50% chance of occurring in the next 12 months (or in 5 out of every 10 years). Unlikely D The event could occur at some time, e.g % chance of occurring in the next 12 months (or in 2-3 out of every 10 years). Rare E The event may occur only in exceptional circumstances, e.g. up to 10% chance of occurring in the next 12 months (or once in 10 years). Extremely Rare F The event may occur only in extremely exceptional circumstances, e.g. up to 2% chance of occurring in the next 12 months (or once or less in 50 years). 164

181 Appendix D Risk Analysis/ Framework & Register Identify Possible Risks Approach from all possible applicable perspectives eg: Operational Reputation/Image Financial/Economic Legislative Health & Safety Environmental Obtain input from the best available information & perform analysis as required Determine likelihood and severity of consequence New or Varied Risks Determine Gross Risk factor using a risk register/matrix (likelihood x consequence) Gross Risk is based on no measures in place to prevent or minimise the likelihood or consequence i.e: How bad would it be if we did nothing?? Review existing risks only Identify current processes & systems in place that effectively help to avoid or minimise the chances & severity of each risk Audits /investigations may be required to measure effectiveness Determine Net Risk factor using the risk register/matrix (likelihood x consequence) Net Risk = Gross Risk minus measures in place to avoid or mitigate. This can also be called Current Actual Risk. Brainstorm possible risk management options to further reduce risk level for each risk Prioritise risks based on size of Net Risk and criticality of service, process or asset Form a practical and achievable Action Plan with priorities aligned with size of each risk. Set Future Risk Ensure mechanisms are in place to monitor, measure, report on and review the Action Plan Use of available techniques to determine various options for risk treatment and cost benefit approach eg: Optimised decision making Future Risk is the risk level expected once management actions are effectively implemented. Progress action, monitor and report, and repeat the cycle at regular intervals Figure D2: Risk Management Process 165

182 Appendix D Risk Analysis/ Framework & Register Council prosecuted for minor offence. Minor localised environmental damage. Prosecution possible. Impact fully reversible within three months. Local adverse political comment. Negative national media coverage. Up to two days of Managers time. Public amenity closed for less than one week. 166 Table D5: Consequence Rating Area of Impact Factor Extreme Major Moderate Minor Insignificant Legal Legal Council sued or fined or otherwise liable for more than $20M. Council sued or fined or otherwise liable for $5M - $20M. Council sued or fined or otherwise liable for $250K - $5M. Council sued or fined or otherwise liable for up to $250K. Catastrophic environmental damage of national importance. Prosecution. Long term study. Impact permanent. Serious environmental damage of national importance. Prosecution. Long term study. Impact not fully reversible. Serious environmental damage of national importance. Prosecution expected. Impact reversible within ten years. Serious environmental damage of local importance. Prosecution probable. Impact fully reversible within one year. Corporate Image Political Appointment of a Commissioner. Decision-making process breaks down. Council delays decisions. Breakdown in the relationship between Council and staff. Image National adverse political comment for one month plus. Negative national multi media coverage for one month plus. Regional adverse political comment for several days. Negative national multi media coverage for several days. Local adverse political comment for one week. Negative national media coverage for two days. Negative international multi media coverage for one month plus. Negative international multi media coverage. Councillor/ Management Time Unplanned collective 30 days of Councillors or Managements time days of Managers time. Service Delivery Service Delivery Water supply and sewage out for city for several days plus. Water supply and sewage out for two suburbs for one week. Water supply and/or sewage out for city for one day. Water supply and/or sewage out for two suburbs for one day. Water supply contaminated. Permanent loss of solid waste facility. Public amenity closed for one month or more. Public amenity closed for two weeks or more. Public amenity closed for one week or more.

183 Appendix D Risk Analysis/ Framework & Register Systematic customer complaints, or complaints relating to more than one occurrence. Isolated customer complaints. Unplanned loss or cost to reinstate less than $500K. Minimal consequential loss in the community (<$250K) Several people ill through contaminated water or similar. 167 Area of Impact Factor Extreme Major Moderate Minor Insignificant Service Delivery Service Delivery Repeated service standard failure or one that affects multiple people. Isolated service standard failure. Financial PNCC Financial Unplanned loss or cost to reinstate of $3.5M or greater Unplanned loss or cost to reinstate between $1.75M- $3.5M. Unplanned loss or cost to reinstate between $1.0M- $1.75M. Unplanned loss or cost to reinstate between $500K- $1.0M. Ongoing loss of $400K pa. Ongoing loss $200K-$400K pa. Ongoing loss $100K-200K pa. Financial Community Financial Catastrophic consequential loss in the community (>$20M) Major consequential loss in the community ($5M-$20M) Significant consequential loss in the community ($1M-$5M) Some consequential loss in the community ($250K-1M) Community Health and Safety Community People in several suburbs ill through contaminated water or similar. People in two-three suburbs ill through contaminated water or similar. People in one suburb ill through contaminated water or similar. Multiple loss of life or citywide epidemic. Loss of life or long-term hospitalisation required. Hospitalisation required. Medical treatment required. Dissatisfaction of community measure needs to be included?

184 Appendix D Risk Analysis/ Framework & Register After the likelihood and consequence factors have been determined, the level of risk is calculated by multiplying the Likelihood of Occurrence (Table) and Consequence Rating (Table) together. Risk = the likelihood of an event occurring X the consequence of such an event. The final outcome is a risk rating. The risk rating enables definition between those risks that are significant and those that are of a lesser nature. Having established the comparative risk level applicable to individual risks, it is possible to rank those risks. Five risk categories have been used: Critical, High, Moderate, Low and Insignificant (see Tables 3 & 4). Once the impact has been ranked according to the relative risk level it poses, it is then possible to target the treatment of the risk exposure, by beginning with the highest risks and identifying the potential mitigation measures. Risk Matrix Consequences Likelihood Insignificant Minor Moderate Major Extreme A M M H C C B L M H H C C L M M H C D I L M M H E I L L M M F I I L L M Comparative Levels of Risk Risk Level Definition Action I Insignificant Risk Examine where un-needed action can be reduced. L Low Risk Managed by routine procedures. M Medium Risk Management responsibility must be specified and risk controls reviewed. H C High Risk Critical Risk Risk and management strategy identified in AMP Failure management plans available. Risk and management strategy identified in AMP Failure management plan specifically addressing event in place. Initially, the gross risk needs to be calculated, so likelihood and consequences need to be considered as if there were no measures in place to prevent or mitigate the risk occurrence. Essentially gross risk is an exercise to determine What is the worst that could happen? Once the gross risk is determined it is possible to investigate the current systems and processes to identify the net risk and then formulate an action plan to further reduce the likelihood or consequences of identified risks occurring. Identify Current Systems & Processes, and their Effectiveness Identifying current systems and processes are identified, and as far as resources allow, their effectiveness measured. It is often practical to identify these processes and systems initially, and rank the effectiveness conservatively until the audits and actual practice prove otherwise. Audits can be identified as part of the improvement process. 168

185 Appendix D Risk Analysis/ Framework & Register Effectiveness of existing systems and processes is expressed in the following categories: Rating Excellent Good Fair Poor Very poor Descriptor Fulfils requirements thoroughly, very robust and positive measurable effects Fulfils requirements, robust and measurable, room for improvement Barely fulfils requirements, effects hard to measure (or haven t been audited or measured), improvement required Not fulfilling requirements, little measurement or effect on overall risk Totally ineffective in avoiding or mitigating associated risk events Determine Net Risk The net risk is the actual risk that exists considering the effective measures implemented. The measures in place reduce either, or both, the consequence and the likelihood of a risk occurrence. The revised factors are input into the same risk matrix to obtain the Net Risk Factor. Risk Action Plan The Risk Action Plan is compiled from the Risk Register and highlights the most significant risks faced as determined in the risk register. The main risks are listed in order of severity (primarily gross risk, and secondarily net risk) as assigned in consultation with key Council officers. Actions that are required to achieve the desired improvements are indicated along with how progress on these actions will be monitored and reported. Where applicable, action tasks will detail timeframes for achievement, and responsibility for these actions. A priority order of issues to be addressed is obtained by sorting first the gross risk levels and then the net risk levels, and identification of the biggest gaps and opportunities for improvement. Gaps between gross and net risk indicate the importance of effective current practices to prevent gross risk events. Accordingly, improvement actions should focus on the things that will further assure Council that current practices remain effective. Gaps between net risk and an acceptable future risk require improvement actions that will reduce current risk levels. Gross Risk Net Risk Future Risk Higher Risk Current practices and strategies Actions required to provide assurance that current practices remain effective Risk treatments to be applied Actions required to reach acceptable risk levels in future Lower Risk The most suitable risk reduction actions must be determined by considering options and resources available to the Council. Costs and benefits of these actions should be analysed to determine those actions yielding the greatest benefit (risk reduction) for the least cost. The best available techniques should be utilised to analyse the options e.g. optimised decision-making (ODM). 169

186 Appendix D Risk Analysis/ Framework & Register Application of ODM applies a value chain to the proposed actions rather than just working from the highest risk down regardless of cost. For example: A high risk may have to remain due to the prohibitive costs associated with avoidance or mitigation A medium risk event could be easily and cost-effectively avoided within resources available The options for mitigating risks considered to reduce the cause, probability or impact of failure, are typically: Rating Accept Risk Strategic Change Operational Change Risk Transfer Descriptor Accept the Risk, fund and resource any risk impacts. Implement strategic planning, organisational improvements. Implement technical improvements, procedural changes. Outsourcing, Improving contract terms, increased insurance. Link to Improvement Plans Actions identified in this Risk Management analysis should be directly linked to actions identified in appropriate improvement plans where they exist e.g. Asset Management Improvement Plan, where resources should be identified, approval of resources noted, and a defined method provided for revisiting and reviewing progress against each action item. Where an equivalent action item is not listed in the Improvement Plan, it should be added. In all cases, the appropriate risk reference number should be noted in the Improvement Plan, and the Improvement number should be noted in the Risk Action Plan. Monitor, Measure, Report, Review Plan and Actions Management options listed in the risk tables have been refined into actions for each risk listed. These are the actions that are required to cost-effectively reduce the net risk by increasing PNCC s ability to minimise the chances of the risk event occurring, or minimising the consequences should it occur. Actions should, where possible, align with the overall management objectives of Council, not simply aimed at the minimisation of risk. If possible, proposed actions should align with other initiatives to: Reduce capital investment costs. Reduce operating and maintenance costs. Reduce business risk exposure (BRE). Increase effective asset life / value. Increase level of service. The resulting action plan for risk treatment needs to be practical and achievable such that the necessary resources and time frames are realistically met. The actions also need to be able to be monitored and measured. The monitoring/reporting column of the Risk Action Table specifies: Responsibility: Nominated person responsible for ensuring the risks are managed and that improvements are carried out in accordance with the programme; Timeframe: Achievable target date to be monitored and reported against; and 170

187 Appendix D Risk Analysis/ Framework & Register Method and Frequency of Monitoring: This entire Action Table will be monitored by the Risk Management Steering Committee, but there will be certain actions that are being monitored and reported in other forums. These forums are to be specified and the frequency with which these actions will be reviewed. The actions listed will be reported, monitored and reviewed regularly at the Risk Management Steering Group and various Group forums. As necessary, this group will need to revise timeframes, responsibility, and even the appropriateness of continuing with the proposed action, or adding new actions. As actions are complete, the net risk should reduce in most cases. The risk tables will need to be reviewed against these and updated to reflect these improvements. Review Risks Most of the time, the risks identified will remain the same and reviews will occur in the context of these risks. However, it will be important to recognise when a new risk arises, or an existing risk changes in nature. In the latter case, the gross risk also needs to be re-evaluated. 171

188

189 Appendix E 30 Year Financial Forecasts Appendix E. 30 Year Financial Forecasts 173

190

191 OPERATING EXPENDITURE ['000s] 2018/ / / / / / / / / / / / / / /33 Activity Delivery $2,725 $2,799 $2,783 $2,827 $2,827 $2,827 $2,827 $2,827 $4,827 $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 Service Level Agreements $2,400 $2,449 $2,433 $2,477 $2,477 $2,477 $2,477 $2,477 $4,477 $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 External Contracts $325 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 Activity Management $2,095 $2,098 $2,090 $2,090 $2,080 $2,080 $2,080 $2,080 $2,080 $2,080 $2,080 $2,080 $2,080 $2,100 $2,100 City Networks Labour and Overheads $937 $939 $931 $931 $931 $931 $931 $931 $931 $931 $931 $931 $931 $931 $931 Consumables $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 Electricity $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 Insurance $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 Consultancy $163 $163 $163 $163 $153 $153 $153 $153 $153 $153 $153 $153 $153 $173 $173 Rates $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 Miscellaneous $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 Gas $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 Legal $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 Reactive Maintenance $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 Plant Repairs and Maintenance $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 Software Licenses $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 Operating Programmes $940 $940 $1,190 $1,190 $940 $940 $200 $200 $200 $200 $200 $200 $200 $200 $ City Wide Infiltration & Inflow Investigations $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 Interest $699 $756 $770 $713 $666 $1,186 $2,805 $4,650 $5,825 $6,082 $5,819 $5,530 $5,175 $4,817 $4,438 Depreciation $4,145 $4,183 $4,221 $4,230 $4,239 $4,253 $4,262 $5,494 $6,100 $6,500 $6,507 $6,523 $6,523 $6,523 $6,523 TOTAL EXPENDITURE $10,604 $10,776 $11,054 $11,051 $10,752 $11,286 $12,174 $15,251 $19,031 $21,703 $21,448 $21,175 $20,820 $20,482 $20, Table E1: Thirty Year Operating Budget 1319-Totara Road Wastewater Treatment Plant - Consent Renewal Upgrade Options Analysis $740 $740 $990 $990 $740 $

192 OPERATING EXPENDITURE ['000s] 2033/ / / / / / / / / / / / / / /48 Activity Delivery $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 $6,842 $6,837 $6,837 $6,837 Service Level Agreements $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 $6,492 $6,487 $6,487 $6,487 External Contracts $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 $350 Activity Management $2,100 $2,098 $2,098 $2,098 $2,096 $2,096 $2,096 $2,096 $2,096 $2,096 $2,096 $2,096 $2,096 $2,096 $2,100 City Networks Labour and Overheads $931 $929 $929 $929 $927 $927 $927 $927 $927 $927 $927 $927 $927 $927 $931 Consumables $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 Electricity $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 $210 Insurance $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191 Consultancy $173 $173 $173 $173 $173 $173 $173 $173 $173 $173 $173 $173 $173 $173 $173 Rates $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 $79 Miscellaneous $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 $61 Gas $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 $30 Legal $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 Reactive Maintenance $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 Plant Repairs and Maintenance $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 Software Licenses $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 $5 Operating Programmes $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $ City Wide Infiltration & Inflow Investigations $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 Interest $4,038 $3,614 $3,163 $2,705 $2,232 $1,752 $1,288 $806 $292 -$241 -$761 -$1,167 -$1,394 -$1,489 -$1,485 Depreciation $6,527 $6,527 $6,527 $6,527 $6,527 $6,527 $6,527 $6,527 $6,527 $6,527 $6,527 $6,520 $6,520 $6,536 $6,536 TOTAL EXPENDITURE $19,706 $19,280 $18,830 $18,372 $17,896 $17,417 $16,953 $16,471 $15,956 $15,424 $14,904 $14,491 $14,259 $14,180 $14, Totara Road Wastewater Treatment Plant - Consent Renewal Upgrade Options Analysis

193 RENEWAL EXPENDITURE ['000s] 2018/ / / / / / / / / / / / / / /33 Wastewater Collection $1,750 $2,425 $2,307 $2,255 $2,057 $2,290 $2,290 $2,037 $2,055 $2,285 $2,085 $1,835 $2,285 $2,985 $1, City-wide - Wastewater Pipe Renewal $1,600 $1,800 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $1,800 $1,800 $1,800 $1,800 $1, City-wide - Wastewater Pump Station Renewal $150 $125 $137 $85 $57 $40 $40 $37 $55 $35 $35 $35 $35 $35 $ Tremaine/Featherston - Wastewater Trunk Main Upgrade (Renewal Component) $450 $1, Eastern Trunk Main - Hokowhitu Campus Renewal - $ Bennett Street 525 Trunkmain Renewal - - $170 $ $ $ Maxwell's Line 825 Wastewater Trunk Main Renewal - $ $ $ Treatment and Disposal $1,943 $60 $100 $830 $50 $350 $20 $20 $20 $20 $20 $20 $520 $95 $ Totara Road Wastewater Treatment Plant - Minor Equipment Renewals $130 $60 $100 $50 $50 $50 $20 $20 $20 $20 $20 $20 $20 $20 $ Totara Road Wastewater Treatment Plant - Replacement of PLCs and SCADA $150 $ Totara Road Wastewater Treatment Plant - Replacement of Grit Removal Systems $ Totara Road Wastewater Treatment Plant - Replacement of Security Fence and Gate $ Totara Road Wastewater Treatment Plant - Replacement of Inlet Pumps $ $ Totara Rd WWTP - Biogas Generator Major Overhauls $ $ $ TOTAL RENEWAL EXPENDITURE $3,693 $2,485 $2,407 $3,085 $2,107 $2,640 $2,310 $2,057 $2,075 $2,305 $2,105 $1,855 $2,805 $3,080 $1, Table E2: Thirty Year Renewal Budget

194 RENEWAL EXPENDITURE ['000s] 2033/ / / / / / / / / / / / / / /48 Wastewater Collection $1,835 $1,835 $1,835 $1,835 $1,835 $1,855 $1,835 $1,835 $1,835 $1,835 $1,835 $1,835 $1,835 $1,835 $1, City-wide - Wastewater Pipe Renewal $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1, City-wide - Wastewater Pump Station Renewal $35 $35 $35 $35 $35 $55 $35 $35 $35 $35 $35 $35 $35 $35 $ Tremaine/Featherston - Wastewater Trunk Main Upgrade (Renewal Component) Eastern Trunk Main - Hokowhitu Campus Renewal Bennett Street 525 Trunkmain Renewal Maxwell's Line 825 Wastewater Trunk Main Renewal Treatment and Disposal $20 $20 $20 $30 $30 $30 $30 $30 $30 $30 $30 $30 $35 $35 $ Totara Road Wastewater Treatment Plant - Minor Equipment Renewals $20 $20 $20 $30 $30 $30 $30 $30 $30 $30 $30 $30 $35 $35 $ Totara Road Wastewater Treatment Plant - Replacement of PLCs and SCADA Totara Road Wastewater Treatment Plant - Replacement of Grit Removal Systems Totara Road Wastewater Treatment Plant - Replacement of Security Fence and Gate Totara Road Wastewater Treatment Plant - Replacement of Inlet Pumps Totara Rd WWTP - Biogas Generator Major Overhauls TOTAL RENEWAL EXPENDITURE $1,855 $1,855 $1,855 $1,865 $1,865 $1,885 $1,865 $1,865 $1,865 $1,865 $1,865 $1,865 $1,870 $1,870 $1,

195 73-City-wide - Wastewater Subdivision Contributions $100 $100 $100 $100 $100 $100 $100 $50 $50 $50 $50 $50 $50 $50 $ Urban Growth - Installation of Wastewater Systems for New Industrial Areas - NEIZ extension area $125 $ $ $ Tremaine/Featherston - Wastewater Trunk Main Upgrade (Growth Component) $ $ Urban Growth - North East Industrial Zone - Downstream Wastewater Network Upgrade - McGregor Street to Rennie Avenue to Peters Avenue $1, $1, Ferguson Street - Wastewater Trunk Main Upgrade $ Urban Growth - Whakarongo - Installation of Wastewater Systems $500 $ $ $ Totara Road Wastewater Treatment Plant - Inlet Main Duplication $50 $ Urban Growth - City West - Installation of Wastewater Systems $50 - $315 - $550 $ C/fwd - Urban Growth - Whakarongo - Installation of Wastewater Systems $ Urban Growth - Ashhurst - Wastewater - North St Network Upgrade - $ Wastewater Collection Sub-Total $1,125 $1,347 $415 $100 $1,042 $382 $1,100 $720 $50 $275 $2,084 $50 $50 $380 $ Table E3: Thirty Year Capital New Budget CAPITAL NEW EXPENDITURE ['000s] 2018/ / / / / / / / / / / / / / /33 Wastewater Collection

196 572-Totara Road Wastewater Treatment Plant - Replacement of Grit Removal Systems (Growth) $ Totara Road Wastewater Treatment Plant - Consent Renewal Upgrade $20,000 $40,000 $30,000 $20, Totara Road Wastewater Treatment Plant - Earthquake Strengthening of Civil Structures $100 $1, Totara Rd WWTP - Biogas Generator Exhaust Heat Recovery $ Totara Rd WWTP - Emergency Bypass Upgrades - $ Totara Rd WWTP - Emergency Overflow Structure Totara Rd - - $ Wastewater Treatment & Disposal Sub-Total $395 $1,100 $ $20,000 $40,000 $30,000 $20, TOTAL CAPITAL NEW EXPENDITURE $1,520 $2,447 $565 $100 $1,042 $20,382 $41,100 $30,720 $20,050 $275 $2,084 $50 $50 $380 $50 CAPITAL NEW EXPENDITURE ['000s] 2018/ / / / / / / / / / / / / / /33 Wastewater Treatment & Disposal 180

197 73-City-wide - Wastewater Subdivision Contributions $50 $50 $75 $75 $75 $75 $75 $75 $75 $75 $75 $75 $0 $0 $0 210-Urban Growth - Installation of Wastewater Systems for New Industrial Areas - NEIZ extension area Tremaine/Featherston - Wastewater Trunk Main Upgrade (Growth Component) Urban Growth - North East Industrial Zone - Downstream Wastewater Network Upgrade - McGregor Street to Rennie Avenue to Peters Avenue Ferguson Street - Wastewater Trunk Main Upgrade Urban Growth - Whakarongo - Installation of Wastewater Systems Totara Road Wastewater Treatment Plant - Inlet Main Duplication Urban Growth - City West - Installation of Wastewater Systems C/fwd - Urban Growth - Whakarongo - Installation of Wastewater Systems Urban Growth - Ashhurst - Wastewater - North St Network Upgrade Wastewater Collection Sub-Total $50 $50 $75 $75 $75 $75 $75 $75 $75 $75 $75 $75 $0 $0 $0 181 CAPITAL NEW EXPENDITURE ['000s] 2033/ / / / / / / / / / / / / / /48 Wastewater Collection

198 572-Totara Road Wastewater Treatment Plant - Replacement of Grit Removal Systems (Growth) Totara Road Wastewater Treatment Plant - Consent Renewal Upgrade Totara Road Wastewater Treatment Plant - Earthquake Strengthening of Civil Structures Totara Rd WWTP - Biogas Generator Exhaust Heat Recovery Totara Rd WWTP - Emergency Bypass Upgrades Totara Rd WWTP - Emergency Overflow Structure Totara Rd Wastewater Treatment & Disposal Sub-Total TOTAL CAPITAL NEW EXPENDITURE $50 $50 $75 $75 $75 $75 $75 $75 $75 $75 $75 $75 $0 $0 $0 CAPITAL NEW EXPENDITURE ['000s] 2033/ / / / / / / / / / / / / / /48 Wastewater Treatment & Disposal 182

199 Appendix F Resource Consents Appendix F. Resource Consents 183

200

201 Appendix F Resource Consents Table F1: Wastewater Resource Consents Asset Consent No. Date Granted Expiry Date Term [Yrs] Term Left [Yrs] Type Consent Subtype Description Totara Rd WWTP May May Discharge Permit Discharge to Water To discharge treated wastewater from the Totara Road WWTP via an outfall structure into the Manawatū River May May Discharge Permit Discharge to Land To discharge digested sewage sludge into and onto land at the sludge lagoons located at the Totara Road WWTP May May Discharge Permit Discharge to Land To discharge treated wastewater to land part of the wetland pond system at the Totara Road WWTP May May Discharge Permit Discharge to Water Emergency discharge into the Mangaone stream. To discharge secondary treated wastewater from the Totara Road WWTP aeration ponds via a grassed channel into the Mangaone Stream May May Land Use Consent Misc. To excavate and disturb the bed of the Manawatū river and adjacent bank to construct use and maintain an effluent discharge structure within the riverbed and adjacent bank and the associated temporary diversion of the flow of the Manawatū River May May Water Permit Divert To excavate and disturb the bed of the Manawatū river and adjacent bank to construct use and maintain an effluent discharge structure within the riverbed and adjacent bank and the associated temporary diversion of the flow of the Manawatū River. 185

202 Appendix F Resource Consents Asset Consent No. Date Granted Expiry Date Term [Yrs] Term Left [Yrs] Type Consent Subtype Description Wastewater Pipe Under Mangaone Stream Dec Dec Land Use Consent Misc. To disturb the bed of the Mangaone stream to place a sewage pipeline beneath the bed of the Mangaone Stream (expired 14 June 2008) and to use and maintain this pipeline (ongoing) Longburn Oxidation Ponds Feb May 10 1 Current Under s124 Discharge Permit Discharge to Water To discharge 250 m 3 /day of treated sewage effluent from the Longburn oxidation pond to the Manawatū river Longburn Oxidation Ponds Application Lodged To be withdrawn as Longburn is now connected to Palmerston North wastewater network Discharge Permit Discharge to Water To discharge 250 m 3 /day of treated sewage effluent from the Longburn oxidation pond to the Manawatū River. Totara Rd WWTP Water Bore Oct 10 1 Jul Water Permit Groundwater Take To take 150 cubic metres per day of water from well number for the purpose of process water and washwater at the Totara Road WWTP. Ashhurst Oxidation Ponds & Application Lodged TBA TBA TBA Discharge Permit Discharge to Land Discharge into land for the purpose of storing human effluent and associated discharge to air. 186

203 Appendix G Asset Grading Definitions Appendix G. Asset Grading Definitions 187

204

205 Appendix G Asset Grading Definitions Table G1: Condition Grading of Rising Mains Condition Grade General Meaning 1 Excellent 2 Good 3 Moderate 4 Poor 5 Very Poor Modern pipe material designed to current standards with no pipe wall or joint failures and no evidence of internal or external degradation. As grade 1 but not designed to current standards in respect of pressure ratings, design specification, jointing or corrosion protection. Deterioration causing minimal influence on performance. Rising mains which are generally sound, although with a few pipewall or joint failures or evidence of some external or internal degradation. Some deterioration beginning to reflect in performance. Rising mains with a significant level of pipe wall or joint failures or evidence of significant external or internal degradation causing, or likely to cause a marked deterioration in performance in the medium term. Some asset replacement or rehabilitation needed within the medium term. Unsound rising mains with extensive pipe wall or joint failures, or significant external or internal degradation, which has failed or about to fail in the near future, causing unacceptable performance. No life expectancy, requiring urgent replacement or rehabilitation. Table G2: Performance Grading of Rising Mains Performance Grade General Meaning 1 Excellent 2 Good 3 Moderate 4 Poor 5 Very Poor Smooth bored mains not subject to degradation with sound factory applied linings; no measurable deterioration in pipe bore; no performance problems. As grade 1 but with loose deposits that are noticeable under abnormal flow conditions or slight deterioration of internal bore which gives a rough surface but with no significant reduction in cross sectional area; occasional flushing and / or desilting required. Some problems with loose deposits or deterioration of linings leading to occasional blockages. History of occasional pipe blockage with tuberculation causing up to 20% blockage by encrustation. Regular flushing or air scouring required. Frequent problems causing blockage on more than one occasion under normal operating conditions during the previous 12 months or mains with tuberculation causing up to 20% to 40% blockage by encrustation. Frequent flushing or air scouring required. Severe problems causing regular blockage and pumping performance cannot be assured; or tuberculation causing greater than 40% blockage by encrustation. Very frequent flushing or air scouring required. Table G3: Condition Grading of Sewers Condition Grade General Meaning CCTV Grading Peak Mean Avg. 1 Excellent Modern pipe material designed to current standards with no structural defects and no evidence of internal or external degradation. 2 Good As grade 1 but not designed to current standards in respect of manufacturer s specification, jointing or corrosion protection. Some deterioration causing minimal influence on performance (e.g. circumferential cracking or minor joint defects). <10 <0.3 <0.4 3 Moderate

206 Appendix G Asset Grading Definitions Condition Grade General Meaning Drains which are generally sound, although with some defects (e.g. deformation 0% to 5% and cracked or fractured; or longitudinal/ multiple cracking; or occasional fractures; or external pipewall degradation) over not more than 25% of the length. Some deterioration beginning to reflect in performance. CCTV Grading Peak Mean Avg. 4 Poor 5 Very Poor Drains with a significant level of defects (for example, deformation 5% to 10% and cracked, fractured, broken, serious loss of level and/ or external pipewall degradation) over not more than 50% of the length causing, or likely to cause a marked deterioration in performance in the medium term. Some asset replacement or rehabilitation needed within the medium term. Unsound drains with a high level of defects (e.g. deformation >10% and cracked and fractured or broken, already collapsed or extensive areas of missing fabric), or uneven grade for over 50% of length causing unacceptable performance. No life expectancy, requiring urgent replacement or rehabilitation. <60 <1.5 <2.0 >60 >1.5 >2.0 Table G4: Performance Grading of Sewers Performance Grade General Meaning 1 Excellent 2 Good 3 Moderate 4 Poor 5 Fail Sewers designed to acceptable standards with adequate self-cleansing velocity; no problems with deposition; no performance problems. As grade 1 but with some slimming or minor deposition causing minor loss of hydraulic capacity but not affecting performance. Sewers with slimming and deposition requiring occasional cleaning or minor backfalls are causing a reduction in pipe capacity or inadequate design capacity and surcharging of the sewer at high flows, although no surface flooding during design storm. Sewers with significant slimming and deposition requiring regular cleaning or backfalls causing a marked reduction in pipe capacity, risk or blockage or inadequate design capacity causing frequent flooding to gardens and roads or occasional flooding to properties or restricted toilet use during design storm. Sewer with a high level of slimming and deposition requiring a high frequency of cleaning or maintenance or backfalls causing a serious reduction in pipe capacity or serious inadequate design capacity, risk of blockages or hydraulic restrictions causing regular flooding to gardens and highways or frequent flooding to properties or restricted toilet use during design storm. Table G5: Condition Grading of Manholes & Cleaning Eyes Condition Grade General Meaning 1 Excellent 2 Good 3 Moderate 4 Poor 5 Very Poor Sound modern structure well maintained with no problems with the manhole structure, cover and frame, step irons, invert, benching or pipe entries into manholes. As for grade 1, but showing minor deterioration and wear and tear. Some indications of structural problems. Some surface damage to the structure but no corrosion staining, cracking or loss of stability. Functionally sound structure but showing some signs of wear and tear. Some minor cracking, staining or signs of tree root penetration. Structure functioning but with problems due to significant infiltration, loss of stability or deformation. Manhole cover or frame showing signs of corrosion causing difficulties for man entry. Step irons showing signs of corrosion. 190

207 Appendix G Asset Grading Definitions Serious structural problems having a detrimental effect on the performance of the manhole structure. Table G6: Performance Grading of Manholes & Cleaning Eyes Condition Grade General Meaning 1 Excellent 2 Good 3 Moderate 4 Poor 5 Very Poor No problems with the manhole structure, cover and frame, step irons, invert, benching or pipe entries into manholes. Fully compliant with safety regulations. No infiltration. Some indications of structural problems with no effect on the functional performance of the manhole. Problems exhibited under high flows that affect the functional performance of the manhole.. Significant problems with either man entry or the functional performance of the manhole such as lack of benching. Significant infiltration causing increased surcharging within the network. ` Non- compliant safety aspects such as corroded or broken step irons resulting in unsafe man entry. No benching in the invert with significant damage affecting the flow. Table G7: Condition Grading of Pumping Stations & Treatment Plant Structures Condition Grade General Meaning 1 Excellent 2 Good 3 Moderate 4 Poor 5 Very Poor Sound structure designed to current standards, well maintained. As grade 1 but not designed to current standards or showing minor wear and tear and minor deterioration of surfaces; some spalling but with no corrosion staining; needs to be inspected in the medium term. Deterioration causing minimal influence on performance. Functionally sound structure, but appearance affected by minor cracking, staining, and vegetation of minor leakage. Some deterioration beginning to be reflected in performance. Structure functioning but with problems due to significant cracking, spalling, cracking, loss of stability, deformation or corrosion likely to cause a marked deterioration of performance in the medium term. Some asset replacement or rehabilitation needed within the medium term. Structure has serious problems and has failed or about to fail in the near future, causing unacceptable performance. No life expectancy, requiring urgent replacement or rehabilitation. Table G8: Performance Grading of Pumping Stations & Treatment Plant Structures Condition Grade General Meaning 1 Excellent 2 Good 3 Moderate Meets all design and statutory requirements at all times and in all demand conditions. For example, capacity exceeds maximum design demand or flow, adequate standby plant facilities design demand or flow, adequate standby plant facilities, emergency sewage overflow provided. No known flooding or surcharging upstream as a result of pump station constraints.. As for grade 1, but with some minor shortcomings in non-critical aspects or under extreme demand or climatic conditions. For example capacity equals maximum design demand or flow, adequate standby plant facilities. No known flooding or surcharging upstream as a result of pump station constraints. Asset generally meeting design requirements with occasional failures in performance criteria under normal conditions. For example capacity less than maximum demand or flow, adequate standby facilities, some known flooding upstream as a result of pump station constraints, occasional operation of storm overflow, or a few reported complaints of noise or smells, or shortcomings in design (pipework, sump, electrics, etc.). 191

208 Appendix G Asset Grading Definitions Condition Grade General Meaning 4 Poor 5 Very Poor Asset with frequent failures in performance criteria under normal conditions. For example capacity significantly less than maximum design demand or flow, standby plant facilities not fully adequate, regular known flooding upstream as a result of pump station constraints, frequent operation f storm overflow, or regular reported complaints of noise or smells, or shortcomings in design (pipework, sump, electrics, etc.). Asset substantially unable to meet performance criteria with very frequent failures against defined standards. For example capacity significantly less than maximum design demand or flow, standby plant facilities not adequate, frequent known flooding upstream as a result of pump station constraints, frequent operation of storm overflow, or regular reported complaints of noise smells, or shortcomings in design (pipework, sump, electrics, etc.). Table G8: Condition Grading of Electrical & Mechanical Plant Condition Grade General Meaning 1 Excellent 2 Good 3 Moderate 4 Poor 5 Very Poor Sound plant designed to current standards, all operable and well maintained. As for grade 1, but not designed to current standards or showing wear and tear. E.g. minor oil leaks, gland wear although protective coatings intact and efficiency undiminished; requires major overhaul within the medium term. Deterioration causing minimal influence on performance. Functionally sound plant and components, acceptable but showing some signs of wear and tear with minor failures and some diminished efficiency. For example, bearing and gland wear and corrosion of metal parts becoming more evident. Deterioration beginning to be reflected in performance and a higher level of maintenance. Plant and components function but require a high level of maintenance to remain operational. likely to cause a marked deterioration in performance in the medium term. Some asset replacement or rehabilitation needed within the medium term. Plant and component effective life exceeded and excessive maintenance costs incurred. High risk of breakdown with a serious impact on performance. No life expectancy, requiring urgent replacement of rehabilitation. 192

209 Appendix H Pump Station Asset Data Appendix H. Pump Station Asset Data 193

210

211 Tremaine Ave Dry well ABS; AFP RC Table H1: Pump Station Asset Data Pump Station Year Built Number Of Pumps Well Pump Make And Model Year Pumps Installed Derived Capacity [L/S] Material Rising Main Condition Grading* Performance Grading* Diameter (Mm) Length (M) Civil Structure Pumps & Control Gear Civil Structure Pumps & Control Gear Maxwells Line Dry Well 2 x Flygt NT3202, & 2 x ABSXFJ250J 2015,2016 & RC College St Dry well Flygt; CP AC Wikiriwhi Crescent Wet well Flygt; CP AC Massey Dry well Flygt NT HDPE Kensington Mews Wet well ABS; AS0840 S17/2D CLS Jickell St Dry well Flygt;CP3217 & Flygt NP3127 MT & PVC Te Awe Awe St Dry well Flygt;NT3102 MT CLS Ruamahanga Cres Wet well ABS; AFP AC Capri Place Wet well ABS; AFP STEEL 100 direct discharge Racecourse Rd Wet well ABS; AFP AC Redwood Grove Wet well ABS XFP100E RC Admirals Place Wet well Grundfos SEV PVC Ryder Cheshire Wet well ABS; XFP100C PVC Newton Place Wet well Flygt MP STEEL

212 Pump Station Year Built Number Of Pumps Well Pump Make And Model Year Pumps Installed Derived Capacity [L/S] Material Rising Main Condition Grading* Performance Grading* Diameter (Mm) Length (M) Civil Structure Pumps & Control Gear Civil Structure Pumps & Control Gear Sutton Place Wet well ABS,S PVC Vogel St Roy Street Shirriffs Rd Ruapehu Dr Te Wanaka Rd Cashmere Drive Durham St Railway Road Grand Oaks Dr Aokautere KB Rd Bunnythorpe Railway Rd Bunnythorpe Maple St Bunnythorpe Reserve Rd Longburn Walkers Rd Longburn Wet well ABS;Piranha10-2 Wet well FlygtNP3085 MT Wet well Flygt NP3085 MT Wet well Flygt CP3127 Wet well Grundfos SEG B Wet well ABS AFP0844 7KW Wet well Flygt CP3085MT Wetwell Grundfos SEV B Wet well Flygt CP3085 Dry well Gorman Rupp VS3 Wet Well Flygt:NP Wet Well Grundfos SEV Wet Well Tsurumi 15 EB2 Wet Well Grundfos SEV Wet Well Grundfos SEV PVC CLS MDPE PVC MDPE PVC PVC PVC MDPE MDPE MDPE PVC AC & & AC MDPE

213 197 Appendix G Asset Grading Definitions Pump Station Year Built Number Of Pumps Well Pump Make And Model Year Pumps Installed Derived Capacity [L/S] Material Rising Main Condition Grading* Performance Grading* Diameter (Mm) Length (M) Civil Structure Pumps & Control Gear Civil Structure Pumps & Control Gear Coutts Way Freedom Dr Ashhurst Hacketts Rd Wet Well Grunfos SE Wet Well Flygt NP3127 Dry Well Grundfos VS 4A60B MDPE MDPE MDPE

214

215 Appendix I Data Management Appendix I. Data Management 199

216

217 Appendix I Data Management Data and Information Management Asset Management Planning depends on drawing on many sources of data and information to formulate plans that quantify the programmes that are required to maintain the asset and provide the required level of service into the future. This section describes the main sources of information that contribute to the different aspects of asset management planning, setting out the source of that information, what it is used for, the quality of information required and how the data is maintained and kept up to date. The confidence and reliability of the data that lies behind the AM programmes is indicated in Table K1. Table I1: High Level Overview of Confidence and Reliability of Data Asset Management Processes Source of Data & Information Use of Information Quality Required for AMPs Maintenance and Updating of Data & Information Demand Forecasting Growth projections population and household growth projections The City Future planning unit provides advice about population and household growth based on NZ Statistics Information, other professional advice and analysis of past Council data. Information is used to formulate a planning scenario for the development of residential and industrial areas. The identification of development of infrastructure is based on spatial projections of both the location and rate of growth provided by Council planners, followed by modelling to determine the additional demand for wastewater services due to that demand. This enables confirmation of downstream network capacity and identification of any network or pumping upgrades. Broad based information only is required that allows a credible 30yr plan to be drawn up and supports the development contribution calculations. Actual development can also be determined by the market at the time. The growth projections and planning scenario are revised every 3 years based on the most up to date information from NZ Statistics. Levels of Service Customer service data (for past 1-3 yrs) K-Base customer service request system Used to inform Council s LOS decision (identifies areas where LOS is not being met or particular service issues are arising. Key source of information on network performance and for identification of problem areas. Also used to monitor and manage the performance of the service provider and check their compliance with key KPIs in their SLAs Sufficient resolution to identify the main service issues and trends. Generally the last years information adequate On-going data being received 201

218 Appendix I Data Management Asset Management Processes Source of Data & Information Use of Information Quality Required for AMPs Maintenance and Updating of Data & Information Submissions made to various Council processes Used to inform Council s LOS decision and as a check that particular service areas have been identified. Part of ongoing Council process Used to inform campaigns to improve understanding of the wastewater system, how it operates and its limitations.u. Communitrak Survey undertaken periodically Used to inform Councillors about trends in customer satisfaction with services being delivered. Reputable survey Survey undertaken every 3 years Assists with Councillor LOS decision Performance measurement (KPIs) Used to monitor the delivery of the agreed level of service Asset Knowledge Asset age and physical attributes Asset Information System (Infor Public Sector) This is core data that is the basis for building up accurate O&M, Renewal and Development Plans. It is also the basis for valuation of the asset. It is essential to good AM to know what assets need to be maintained and renewed. Accurate information with regard to the physical attributes is important. The AIS is continually being updated by the Asset Systems Officer as new information comes to light and as new assets are being built (As built plans). A reliable date of construction (at least to within 5 years) is desirable A dedication officer maintains the system. Checks on integrity & accuracy of info. Asset condition Information collected from CCTV surveys and physical inspections of all critical assets and a crosssection of non-critical assets. Used to identify faults and performance issues in critical assets for immediate resolution. Used to develop specific life estimates and projections of the renewal profile for non-critical assets Sufficient overall resolution of condition to reliably inform a 5 level grading system. Needs to be added to on a continuous basis. Physical inspection of critical assets to be undertaken on regular cycle e.g. 5 years. CCTV inspection of remaining network scheduled so that the entire network is inspected every 10 to 15 years. Asset performance Information from monitoring, customer complaints and scheduled inspections is captured in Asset Management System Inform further investigation and fault finding to identify defects or performance issues. Where performance is related to capacity use to inform detailed catchment modelling to identify any capacity improvements Needs to accurately identify the current situation Data needs to be continuous captured and recorded against the asset to provide an up to date record of issues 202

219 Appendix I Data Management Asset Management Processes Source of Data & Information Use of Information Quality Required for AMPs Maintenance and Updating of Data & Information Analysis of asset information From information collected & input into the AMS etc Modelling of both current situation and future condition allowing for full development and the influence of climate change. Asset information enables robust determination of capital improvements which will deliver sustainable and durable long term improvements in service. Up to date Data needs to be logging and recorded continuously. Key to this is providing mobile solutions which allow field staff to update asset data and record issues directly they are identified. Predictive modelling to determine asset renewal profiles under different risk scenarios. It is intended to give customers and contractors the ability to report on errors in the asset data and so assist the improvement process. Analysis can be undertaken periodically ahead of key planning milestones e.g. LTP Service Delivery Procurement of work so as to provide service through operation and maintenance of the assets Previous information about the cost and scope of work done or assets built. Information about Internal service delivery stored in SLA system. Data about market prices and comparability of internal service delivery to be migrated to database in Benchmark. Data is used to prepare engineer s estimates prior to seeking either internal or external prices. Data is critical for determining the market comparability of internal service delivery and whether external contract procurement is justified. Costs data is also used to value new assets and confirm asset valuations on an annual basis. Up to date with latest prices and costs captured as soon as possible after work is completed Needs to be kept up to date given that the costs for constructing new infrastructure change rapidly in response to a range of external factors Programme Planning Data about programmes objectives, scope, timing, cost and risk, previous investigation. Programme Planning and Implementation Database (currently in Excel spreadsheets). Used to inform asset programmes for the asset management plan. The database is based on a comprehensive template covering programme information. The PPI database for each programme in the AMP is updated annually by the asset manager for each activity. 203

220 Appendix I Data Management Asset Management Processes Source of Data & Information Use of Information Quality Required for AMPs Maintenance and Updating of Data & Information Specific strategy reports including network renewal strategy. Identifies specific constraints and servicing challenges and sets out options for investment to mitigate effects. The data is critical to providing options for consideration by Council in respect of different levels of investment to meet different levels of service. High level but with clear detail of assumptions used Regular updating required at a frequency necessary to inform key planning and funding decision making e.g. 3 yearly to align with the LTP. Outlines consequences of not proceeding with investment as well as benefits. Specific consultants reports: Wastewater I&I - GHD Flow Capacity Assessment H&G Sewer Renewal Strategy - ProjectMax Used to identify work programmes required to meet the AMP objectives Assisted with confirming capacity parameters for renewal and major capital upgrade programme at the WWTP. Also provided basis for development of renewal programme for the LTP and 30 year programme. Snapshot of current and future requirements. Council s 10YP Used to inform changes adopted by the Council to previous AMP programmes High level estimates which are sufficient to deliver the programme of work given the risk profiles for each programme or activity. Through Council s annual budget and 10YP process & system Financial Planning Long term financial forecasts 30 year Infrastructure Plan Used to inform Council of future funding profiles, borrowing obligations and renewal funding issues. High level estimates with significant contingency based on optimised profiling of renewals and realistic assessment of new capital requirements. Three year updates ahead of Council s 10YP process Reliability and Confidence in Programmes The expenditure and programmes in this AMP Plan are based on the data sources described in Appendix I. Confidence that programme information is reliable depends on the accuracy of the input data sources upon which that programme is based. The following is an assessment of the overall confidence in the various data streams that input into programmes, including the demand drivers, growth projections, the condition and performance data and the estimating data used for the financial forecasts. Further work on this aspect is planned over the next 3 years with a data improvement plan project being included in the Improvement Plan. 204

221 Appendix I Data Management Definition of Data Confidence Rating Table I2: Confidence Grading Description Confidence Grade Description Processes Asset Data 5 Highly reliable/ Audited Strictly formal process for collecting and analysing data. Process is documented and always followed by all staff. Process is recognised by industry as best method of assessment. Very high level of data confidence. Data is believed to be 95 to 100% complete and ±5% accurate. Regular data audits verify high level of accuracy in data received. 4 Reliable/ Verified Strong process to collect data. May not be fully documented but usually undertaken by most staff. 3 Less Reliable Process to collect data established. May not be fully documented but usually undertaken by most staff. 2 Uncertain Semiformal process usually followed. Poor documentation. Process to collect data followed about half the time. 1 Very uncertain Ad hoc procedures to collect data. Minimal or no process documentation. Process followed occasionally. Good level of data confidence. Data is believed to be 80 to 95% complete and ±10 to 15% accurate. Some minor data extrapolation or assumptions has been applied. Occasional data audits verify reasonable level of confidence. Average level of data confidence. Data is believed to be 50 to 80% complete and ±15 to 20% accurate. Some data extrapolation has been applied based on supported assumptions. Occasional data audits verify reasonable level of confidence. Not sure of data confidence, or data confidence is good for some data, but most of dataset is based on extrapolation of incomplete data set with unsupported assumptions. Very low data confidence. Data based on very large unsupported assumptions, cursory inspection and analysis. Data may have been developed by extrapolation from small, unverified data sets. 0 No data No process exists to collect data. No data available. 205

222 Appendix I Data Management Assessment of Confidence in Key data Inputs to AMP Table K3: Confidence Grading Description Data Demand drivers Growth projections Asset useful lives Confidence Assessment Comment 4 Demand drivers in respect of wastewater services include: Changes associated with new consents targeting improvements in effects in the Manawatu River Changes to the pattern and intensity of rainfall across the city impacting on the frequency and severity of wet weather flows due to stormwater infiltration and inflow Higher expectations in the community that negative effects from wastewater should be mitigated including avoidance of overflows, removal of 100% of heavy metals, emerging contaminants and non-organic compounds e.g. micro-plastics Expectations that there should be no impediment to growth from either residential or industrial such that the wastewater system should be able to accommodate all future growth in flows and loads 4 The growth projections are neither predictions nor forecasts. They are built on assumptions about future changes in population based on demographic trends and patterns and other factors. Variations in the economic cycle mean that it is inevitable that the actual rate of growth will be above or below the projected rate at different times in the economic cycle. Projections are reassessed every 3 years in the light of the information available at that time at which point the programmes based on the projections will be reassessed. 2 The current useful lives for wastewater assets are based on the asset lives detailed in the IIMI guidelines. For some asset types where condition assessments indicate the lives differ from the mean, these have been reduced or increased. It is clear that there are some pipeline assets which require immediate renewal, not because they have failed but because they let unacceptable quantities of stormwater. This reduced life assessment is not reflected in the asset register. Asset values 4 Asset values are based on the latest information for renewal and capital construction costs for work undertaken in the last two years by Council. Where no work has been done estimates for work undertaken by local Councils within the region have been used. Condition of asset Performance of Network Operational forecasts Renewal forecasts 3 Asset condition assumptions are based on the results of historical CCTV inspections for a portion of the network. These inspections are somewhat dated and of average quality. Work is now underway to significantly increase the investment in inspection and condition scoring to develop a more robust assessment of condition. 3 The development of an integrated model of the sewer network has highlighted system capacity constraints under wet weather conditions. The modelling has confirmed the anecdotal evidence of capacity constraints in some parts of the network during wet weather events. While dry weather performance is good, during wet weather events the key large pumping stations, trunk sewers and WWTP inlet works are all operating at or close to capacity. Further refinement of the model will improve confidence around understanding of the network performance. 3 Forecasts of operational costs are uncertain due in large measure to the unknown impact of the pending upgrade to the wastewater treatment and disposal facility. There is also uncertainty around the cost of addressing a growing number of lateral and mains blockages. There is evidence of significant legacy issues associated with the laying of flat sewers or poorly constructed sewers which is contributing to maintenance costs. 2 While additional funding has been requested for next 7 years of the AMP to address legacy renewals, much of this is to renew earthen ware pipes in catchments with significant stormwater infiltration and inflow. Given the limited extent of recent CCTV inspection data there is limited confidence in the renewal forecasts. It is expected that with more condition information, additional investment in renewals may be required to address legacy condition issues within the older parts of the network. 206

223 Appendix I Data Management Data Development forecasts Confidence Assessment Comment 3 Current planning forecasts are considered robust and potentially overestimate the demand and the rate of uptake for both residential and commercial property particularly in greenfield areas. The key uncertainty is in the impact of infill growth on wastewater flows in the existing network. Without effective control of stormwater infiltration and inflow there is the possibility of significant capacity constraints during wet weather events. The implementation of low pressure sewer systems is designed to help mitigate this. Reliability of Financial Forecasts Information for programmes in this plan are derived from the information that is input into the Programme Planning and Implementation database. This database provides for the estimating accuracy to be made of each programme together with the estimating rates on which the estimate is based. The types of estimates with their definition are as follows: Ballpark This is an order of magnitude estimate made in the early stages of a project based on high level comparative information Rough Order This applies in the early stages of feasibility using a top down approach but with better breakdown of the major components of work. Preliminary Work is reasonably well defined with more detailed knowledge of quantities and scope of work. Based on historic rates for construction Firm Engineers Estimate This is based on detailed design specification and drawings. Costing is based on market rate information. In this plan an assessment is made of the reliability of the financial forecasts based on the reliability of physical asset data, asset condition data, asset performance data and growth projections in Section

224

225 Appendix J 6 Year Asset Renewal Programme Appendix J. 6 Year Asset Renewal Programme 209

226

227 Appendix J 6 Year Asset Renewal Programme Table J1: Programme and Renewal Project List Programme and Renewal Project List 2018/19 [$] 2019/20 [$] 2020/21 [$] 2021/22 [$] 2022/23 [$] 2023/24 [$] 1059-Totara Road Wastewater Treatment Plant - Replacement of Grit Removal Systems $494,764 Grit System $494, Totara Road Wastewater Treatment Plant - Replacement of Security Fence and Gate $250,000 Security Fence and Gate $250, Totara Road Wastewater Treatment Plant - Replacement of Inlet Pumps $918, $780,000 Upgrade two lift pumps $918,000 $780, Eastern Trunk Main - Hokowhitu Campus Renewal $250,000 Hokowhitu Campus $250, Bennett Street 525 Trunkmain Renewal $170,000 $170,000 Bennett Street 525 Trunk Main Renewal $170,000 $170, Maxwell's Line 825 Wastewater Trunk Main Renewal Maxwell's Line 825 Wastewater Trunk Main Renewal $250, $250,000 $250,000 $250, Totara Rd WWTP - Biogas Generator Major Overhauls $150, $300,000 E50 12,000 hr service of Engine $150,000 E60 24,000 hr service of Engine $300, Totara Road Wastewater Treatment Plant - Minor Equipment Renewals $130,000 $60,000 $100,000 $50,000 $50,000 $50,000 Cross collector gear box 1 $5,000 Digester heat exchange 2 $70,000 Cross collector gear box $10,000 Digester Sludge circulation pump 1 $15,000 Air compressor main building $15,000 Digester Sludge circulation pump 2 $15,000 Hot water cylinder $5,000 Gallery water pipelines $25,

228 Appendix I Data Management Programme and Renewal Project List 2018/19 [$] 2019/20 [$] 2020/21 [$] 2021/22 [$] 2022/23 [$] 2023/24 [$] Main air supply fan $15,000 DO probes in second oxidation pond $15, mm outlet mag flow meter $50,000 Potable water booster set $40,000 Wave bands $10,000 Minor and Reactive Works $50,000 $50,000 $50, City-wide - Wastewater Pipe Renewal $1,600,000 $1,800,000 $2,000,000 $2,000,000 $2,000,000 $2,000,000 Minor and Reactive Works $55,587 $38,948 $188,850 $42,576 $266,158 $58,442 Renewal Dia - Street 600mm -Moray Pl $50, mm -Rugby St $89, mm -Nottingham Ave $194, mm -Alexander St $2, mm -Totara Rd $3, mm -Marriner St $212, mm -Alexander St $196, mm -College St $115, mm -Maxwells Line $299, mm -Glen Pl $69, mm -Botanical Rd $65, mm -Maxwells Line $243, mm -Shamrock St $54, mm -College St $723, mm -Ferguson St $24, mm -Featherston St $42, mm -Kaimanawa St $27, mm -Hobson Pl $45, mm -Mihaere Dr $129, mm -Clausen St $231, mm -Pitt St $43, mm -Botanical Rd $150, mm -Botanical Rd $238, mm -Ferguson St $3, mm -Vogel St $44, mm -Cuba St $31, mm -College St $2,

229 Appendix I Data Management Programme and Renewal Project List 2018/19 [$] 2019/20 [$] 2020/21 [$] 2021/22 [$] 2022/23 [$] 2023/24 [$] 375mm -Wood St $205, mm -Crewe Cres $202, mm -Centennial Dr $218, mm -Ferguson St $302, mm -Burns Ave $50, mm -Pioneer Hwy $122, mm -Churchill Ave $134, mm -Tremaine Ave $541, mm -Browning Pl $12, mm -Balmoral Dr $66, mm -Stirling Cres $82, mm -Albert St $311, mm -Te Awe Awe St $147, mm -Fitzherbert Ave $251, mm -The Square $112, mm -Maxwells Line $4, mm -Tremaine Ave $401, mm -North St $261, mm -Wood St $52, mm -Mcgiffert St $31, mm -Woodstock Pl $38, mm -Main St $152, mm -Alton Pl $31, mm -Bryant St $59, mm -Cuba St $215, mm -Joseph St $125, mm -Fitzroy St $44, mm -Church St $64, mm -Grey St $445, mm -College St $45, mm -Guy Ave $87, mm -Crewe Cres $26, mm -Hardie St $83, mm -Cleland St $44, mm -Heretaunga St $4, mm -Centennial Dr $14, mm -Ihaka St $146,

230 Appendix I Data Management Programme and Renewal Project List 2018/19 [$] 2019/20 [$] 2020/21 [$] 2021/22 [$] 2022/23 [$] 2023/24 [$] 225mm -Cook St $196, mm -Jickell St $128, mm -Shamrock St $34, mm -Main St $518, mm-Matipo St $88, mm -St Johns Ave $111, mm -Pahiatua St $303, mm -Roy St $177, mm -Parkland Cres $85, mm -Snelson St $27, mm -Princess St $125, mm -Ruahine St $105, mm -Rangitikei St $143, mm -Rongopai St $80, mm -Rata St $139, City-wide - Wastewater Pump Station Renewal $150,000 $125,000 $137,000 $85,000 $56,500 $40,000 Minor and Reactive Works $1,000 $11,500 $28,500 $56,500 $40,000 New antena pole and 3rd repeater plus 10 individual RTU's $90,000 Capri Pl WW PS Pumps $9,000 Jickel ST WW PS Pump Controls $25,000 Te Wanaka Rd WW PS Electrical Incl. Telemetry $15,000 Roy St WW PS Electrical $10,000 RTUs $65,000 $53,500 Ruamahanga Cr WW PS Pumps $13,500 Tremaine Ave WW PS Electrical $20,000 Capri Pl WW PS Electrical $15,000 Maple St WW PS $17,500 Maxwells Ln WW PS Electrical $66,000 Racecourse Rd Electrical $16,500 Massey Pump Controls $40,

231 Appendix K Final Peer Review Report Appendix K. Peer review comments to be added here Final Peer Review Report 215

232

233 PNCC Asset Management Review Palmerston North City Council 16-Apr-2018 Asset Management Review AMP's 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

234 AECOM PNCC Asset Management Review Asset Management Review AMP's Quality Information Document Ref Date Prepared by Reviewed by Asset Management Review AMP's p:\605x\ \8. issued docs\8.1 reports\pncc 2017 amp review final.docx 16-Apr-2018 Stephen Garlick Ian Martin Revision History Rev Revision Date Details Name/Position Authorised Signature Draft A 21-Mar-2018 For Comment Ian Martin Regional Manager, Wellington Final 16-Apr-2018 Final Issue Ian Martin Regional Manager, Wellington 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

235 AECOM PNCC Asset Management Review Asset Management Review AMP's Appendix F Wastewater AMP 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

236 AECOM PNCC Asset Management Review Asset Management Review AMP's F-1 Appendix F Wastewater AMP PNCC AM Assessments 2018 AMP 2017 Wastewater AMP Assessment Item 1 Alignment Score 2-3 Why is this important? Our Findings The purpose of organisations is to achieve organisational objectives. In the case of local authorities these are generally expressed as Community Outcomes (required by and LGA 2002) and in some cases separate organisational objectives sitting below the Community Outcomes. It is important that the management of asset based local authority activities (as set out in AMPs) is clearly aligned with and contributes to the achievement of organisational objectives. AMPs should also reflect the organisation s asset management policy and strategy (if there the organisation has these) and with the Infrastructure Strategy. Roading AMPs (and in particular any works that receive government subsidy) should be consistent with and support the Government Policy Statement on Land Transport and the three strategic priorities forming part of the National Policy Statement Table 3 sets out how the Wastewater Activity contributes to the following 2 (of 5) City Goals An innovative and growing city An eco-city. It is understood that the 5 City Goals stated in the AMP are the proposed Palmerston North City Community Outcomes for the LTP. The contribution of the Wastewater Activity to City Goals is expressed in Table 3 as Priorities. These read more like strategies than statements of how the Wastewater Activity contributes to City Goals e.g. Regenerate native biodiversity sounds more like a strategy than a contribution of the Wastewater Activity contributes to City Goals. AMPs are founded on the services to be provided and the standards to be achieved in the provision of these services (Levels of Service). These Levels of Service should therefore be clearly aligned with and contribute to the achievement of the Community Outcomes. This is an issue Audit NZ have raised in audits of other organisations. The Levels of Service for the Wastewater Activity set out in Table 7 cover: Quality and Health Reliability Responsiveness Accessibility Sustainability Financial Management. How these Service Criteria align with and contribute to City Goals could be more explicit. Details of this alignment are probably best appended. The asset management process and alignment between the principal elements of asset management can be illustrated by the following diagram. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

237 AECOM PNCC Asset Management Review Asset Management Review AMP's F-2 Closing the loop on the asset management process involves measuring performance relative to what we set out to achieve and using this performance (performance gaps) as a basis for continual improvement. 2016/2017 performance is shown relative to performance targets in the levels of service/key performance indicators Table 7 in Section of the AMP. It is noted that the only KPI where the target level of performance was not fully achieved was: The number of dry weather wastewater overflows from the Council s sewerage systems per 1,000 connections per year. Section covers Service Level Gaps. It would be expected that this failure to achieve the target level of performance would be reflected in the analysis of service level gaps which in turn feed into capital programmes. Instead service level gaps discussed in section relate to: Stormwater infiltration and inflow. Capacity constraints in trunk main network It is difficult to identify the service levels in Table 7 that these Service Level Gaps relate to. Section 3.4 of the AMP sets out the Asset Management Policy and Strategy for Palmerston North City Council. The Wastewater AMP reflects this Policy and Strategy. Ideally, the financials in the AMP would be presented in a way such that principal bottom lines can be readily reconciled with the financial statements in the Council Long Term Plan. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

238 AECOM PNCC Asset Management Review Asset Management Review AMP's This is important as Audit NZ have the very reasonable expectation that the AMPs will clearly provide the basis and justification for the financial statements in the LTP. The following expenditure forecasts are taken from the 2017 Wastewater AMP Lifecycle Programmes These are then summarised in the Financial Forecasts in Appendix E. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A F-3

239 AECOM PNCC Asset Management Review Asset Management Review AMP's F-4 There appears to be a mismatch between the financials set out in the lifecycle programmes and the financials in Appendix E. For example the budgeted renewal expenditure for 2018/2019 in Table 23 is $3,693,000 whereas in Table E2, budgeted renewal expenditure for 2018/2019 is $2,127,000. For 2019/2020, the figures in the two tables are $2,485,000 and $1,595,000 respectively. In the 2015/2025 LTP the renewal figures are $3,789,000 for 2018/2019 and $1,818,000 for 2019/2020. The draft 2018/2028 LTP is not currently available. There appeared to be a surprising level of variance between the financials in the 2017 AMP and those in the 2015/2025 LTP, even allowing for the fact that the 2015/2025 LTP is in the process of being superseded.. It has been assumed that such discrepancies do not appear when comparing with the 2018/2028 draft LTP. It is extremely important that there is a clear line of sight from the budget figures in the LTP back to the consolidated financial projections in the AMP and from there back to the budgets in each of the lifecycle programmes. Audit New Zealand have the very reasonable expectation that the AMP will be the sources of financial forecasts in the LTP and that this can be readily verified by comparing both documents. Inability to demonstrate this clear line of sight will undermine the credibility of both the AMP and of the LTP. Opportunities for Improvement 1. Show more clearly the alignment between the Levels of Services set out in Section 4 of the AMP, the Activity Contribution to City Goals and therefore the City Goals. The diagram below provides one example of how this alignment might be demonstrated. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

240 AECOM PNCC Asset Management Review Asset Management Review AMP's F-5 2. Improve the alignment between service gaps arising from the comparison of 2016/2017 performance with the current target in Table 7 in the AMP, the discussion of service level gaps in Section and the capital development programme recognising that current and expected service gaps are the driver for new capital investment. 3. Ensure there is a clear line of sight from the Financial Projections on the LTP back to the consolidated financial projections in the AMP and from there back to the budgets in each of the lifecycle programmes 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

241 AECOM PNCC Asset Management Review Asset Management Review AMP's F-6 Assessment Item 2 Service statements and Levels of Service Score 3 Why is this important? Our Findings AMPs should be founded on a statement of what the plans are intended to achieve. This is generally a statement of the services to be provided through the plan, the standards to be achieved and the level of performance that is targeted. This should incorporate the mandatory performance measures required under the Non- Financial Performance Measures Rules Roading AMPs should incorporate One Network Road Classification performance measures as appropriate. The justification for the target levels of service should be provided. Ideally this would include consideration of benefits and costs of different levels of service. Ideally the AMP would provide a clear statement of the services that will be provided to each of the main customer segments. This, together with standards to which these services will be provided form the foundation of the AMP. Section 2.2 of the AMP provides the following segmentation of customers: Customers of wastewater services are broken down as follows: Residential customers Industrial customers Commercial customers. Ideally any customer reading the AMP should be able to readily identify the customer segment (or segments) within which they fit and the associated services they can expect to receive from the Council. This is typically presented as follows. Service statements represent the objectives that the AMP aims to achieve. It is important that these objectives are clearly aligned with organisational objectives (alignment should be demonstrated in the AMP). The AMP does not appear to identify the point of service for wastewater services provided by the Council. (Different customers should be able to clearly understand the point of demarcation between the Council responsibilities and their responsibilities) The Customer Levels of Service for Wastewater set out in Table 7 of the AMP cover the following service dimensions: Quality and Health Reliability Responsiveness Accessibility Sustainability Financial Management. There is a good range of Customer Performance Measures for these service dimensions. Technical Levels of Service are appended in Table C1 although these appear to be the same as the Customer Levels of Service. Tables 5 and C1 incorporate the Local Government Mandatory Performance Measures set out in the Non-Financial Performance Measures Rules Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

242 AECOM PNCC Asset Management Review Asset Management Review AMP's F-7 Where there is a significant variation between actual and target level of performance some form of commentary should be provided as this may indicate a need for some form of intervention. For example the number of blockage complaints is approximately 16 times lower than the target which is good but which begs the question Is the target too high? A commentary on unusual looking results would address potential questions Performance targets for each LOS are stated for a 10 year horizon. It is unclear how these performance targets were set and whether any analysis of the benefits and costs of different performance targets has been carried out. Anticipated changes in target levels of service are stated and there is a discussion of service gaps. Opportunities for Improvement 4. Identify the customer segments for wastewater services the associated services these segments can expect to receive from the Council. 5. Define the point of service for wastewater services 6. Provide a commentary where there is a significant variance between Actual Performance achieved and the Performance Targets 7. Provide a commentary on how the target levels of service were set. Ideally this would include consideration of cost implications of different levels of service although a full benefit/cost analysis of different levels of service may not be justified. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

243 AECOM PNCC Asset Management Review Asset Management Review AMP's F-8 Assessment Item 3 Future demand Score 3 Why is this important? Our Findings AMPs are strategic documents which take a long term view. It is important to identify the principal changes which are likely to impact on the plan over the term of the plan and take account of these changes in the plan. This involves identifying the principal drivers of change, assessing how these drivers are likely to change over the term of the plan and the overall impact on the plan. The AMP identifies 8 principal drivers of demand. Residential and, industrial growth in the city. Changes in water consumption and usage patterns. Most water supplied for domestic, commercial, and industrial purposes is subsequently discharged into the wastewater system. Greater uptake of Low Pressure Sewer particularly in the pressure sewer designated areas. Changes in Council policy with regard to rural residential properties. The extent of stormwater entry to the wastewater system (infiltration and inflow). Future demand for treatment of wastewater driven by technology changes. Regional Council One Plan Standards Climate change. There is a discussion about how each of these factors is expected to change over time. The way the discussion about these factors is presented could be improved to mirror more closely the 5 drivers of demand as indicated below. These drivers of demand feed into a demand projection in Table 13 covering a 30 year horizon. As well as showing projected flows this also projects the different loadings (BOD, SS etc.) in the wastewater that impact on treatment processes. There is merit in segmenting the demand projection by the drivers of demand and showing this graphically. This highlights what is primarily driving future demand and the areas where efforts should be focussed to reduce demand. Ideally there would be an indication given of confidence in the demand projection. This could be done by providing high, medium and low projections of demand. Opportunities for Improvement 8. Provide an indication of the level of confidence in demand projections 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

244 AECOM PNCC Asset Management Review Asset Management Review AMP's Assessment Item 4 Risk Score 2-3 Why is this important? Our Findings AMPs set out how organisations intend to work to achieve activity specific asset management objectives. It is important to also identify risks to the achievement of these objectives, ensure transparency of these risks and manage these risks within the risk appetite of the organisation. Risk should be an input to decision making. There is comprehensive coverage of risk in the Appendix D of the AMP with a summary of the approach set out in Section 7. Risks are managed in accordance with a Corporate Risk Management Policy which supports a consistent approach to risk management across the organisation. This policy covers strategic, operational and project risks. There is a separate section (7.2) on Activity Risk Management. In Section 7.2.1, it is stated that the consequence of risk is evaluated in terms of: Legal Environmental Corporate Image Service delivery Financial Community Health and Safety. Table D2 sets out Measures of Consequences of Failure. It is noticed that in this table Environmental is not identified as an area of impact with environmental damage being included in the Legal category. It is suggested that particularly for an activity such as wastewater which can have significant environmental effects, Environmental should be a separate consequence category. It is noted that Table D5: Consequence Rating appears to repeat Table D2: Measures of Consequence of Failure and that there appear to be two different risk matrices shown as follows. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A F-9

245 AECOM PNCC Asset Management Review Asset Management Review AMP's F-10 Obviously duplication is undesirable consistency is essential. Although reference is made in the AMP to a risk register in Appendix D, there did not appear to be an Activity Risk Register in the AMP. Figure D2 sets out a risk management process which includes the identification of risk. Risks are uncertain future events that could impact on an organisation s ability to achieve its objectives. The AS/NZS ISO 31000:2009 Standard defines risk as the effect of uncertainty on objectives. Risks should therefore be identified in terms of objectives (Impact on objectives is what makes a risk a risk). It is suggested that this process diagram should also include reference to objectives in the risk identification phase. Opportunities for Improvement 9. Include a register of Activity Risks in the AMP 10. Add consideration of objectives to Figure D2 - risk management process recognising that it is impact on objectives which makes a risk a risk. 11. Ensure a consistent approach is adopted to the assessment of risks (single risk matrix) and delete one of the risk consequence tables. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

246 AECOM PNCC Asset Management Review Asset Management Review AMP's F-11 Assessment Item 5 Critical assets Score 2-3 Why is this important? Our Findings Critical assets are those with a high consequence of failure. It is important that critical assets are identified using a defined and consistent methodology and that appropriate interventions are put in place (such as condition monitoring, replacement before failure, contingency planning, actions to reduce criticality) to minimise the risk of failure of critical assets. Asset Criticality is summarised in Section 7 Risks and Resilience and covered in more detail in In 7.2.3, critical assets are identified as those assets which have the highest consequences should they fail. Section states that Criteria for assessing criticality are: Numbers of people adversely affected; Significant business activity interrupted; Consequential cost of failure; and Critical lifeline/disaster recovery asset. Other The criticality of pump stations is assessed in terms of the sensitivity of the receiving environment to overflows is considered, as well as the population served. Criticality of treatment plant assets is based on the consequence of failure of each component and its role as part of the treatment process overall. Risk and criticality are linked. Whereas risk is a combination of consequence and probability, criticality is about consequence only. Consequence of activity risk is assessed in the AMP in terms of the following: Legal Environmental Corporate Image Service delivery Financial Community Health and Safety In the interests of consistency, the same criteria should be used to assess criticality. For example should an asset whose failure would be likely to lead to severe environmental damage, national headlines and prosecution of the Council be considered a critical asset? It probably should. Also assets serving critical customers such as hospitals do not appear to have been identified as critical by the current process. Section sets out how the Council s maintenance strategy is linked to asset criticality with different inspection and maintenance regimes for Highly critical assets Medium and Low criticality assets Non critical assets. Criticality is also taken into account in making renewal decisions. Taken overall, criticality is well done in the Wastewater AMP. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

247 AECOM PNCC Asset Management Review Asset Management Review AMP's F-12 Opportunities for Improvement 12. Ensure alignment and consistency between assessments of criticality and assessments of risk by assessing consequence on the same basis for both risk and criticality. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

248 AECOM PNCC Asset Management Review Asset Management Review AMP's Assessment Item 6 Justification for maintenance programmes Score 2-3 Why is this important? Our Findings Maintenance programmes are relied upon as a source of inputs to the Council s long term financial planning and the Council Long Term Plan. They should provide confidence that an appropriate level of maintenance is being carried out and that the ability to achieve service objectives and the service capability of the assets is not being compromised. Maintenance programmes should be subject to systematic decisionmaking processes to optimise these programmes Roading AMPs should incorporate the NZTA Business Case Approach to ensuring appropriate and cost effective maintenance programmes. Operation & Maintenance of Assets is set out in Section 6.8. The purpose of asset operation and maintenance is clearly set out. There are defined maintenance strategies based on the criticality of assets. It is important that utilities are operated correctly in accordance with the designer s intentions. Operation and maintenance of key wastewater utilities should be carried out in accordance with defined procedures which are documented in operations manuals. It is unclear whether there are operations manuals for wastewater utilities. Operations manuals also provide a basis for audits to be carried out to ensure utilities are being operated and maintained correctly. Table 20 provides a 5 year forecast of operations and maintenance costs. There should be a clear line of sight from the maintenance programmes in the AMP to the financial programmes in the LTP. The reasons and consequences of any inconsistencies between the AMP and the LTP should be stated This appears to be at variance with the 30 year operational budget set out in Table E1 Ideally the AMP would provide additional commentary on the basis of the justification for the expenditure forecasts in Table 21. The Operation & Maintenance of Assets section of the AMP should explain this is what we need to do (and why) and these are the costs arising from that. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A F-13

249 AECOM PNCC Asset Management Review Asset Management Review AMP's F-14 Such a commentary might be along the following general lines: The budget has been derived from historic costs that have been established as being sufficient to carry out the maintenance and operation programme and which have been amended as necessary to allow for changes in management activities and practices. The forecast for expenditure is based on assumptions that: The overall condition of the network will not change significantly over the next 15 years (see renewal strategies). Extensions of the wastewater system will represent only a small proportion of the entire system (see demand projections). The level of maintenance required will not increase (and may decrease), reflecting an increase in the overall condition of the wastewater network as a result of the asset renewal programme. There will be a significant increase in the price of the operation and maintenance contract when it is competitively re-tendered. (this reflects our assessment of the market for this type of work). Opportunities for Improvement 13. Ensure the correct maintenance and operation of all significant wastewater utilities is documented in operations manuals 14. Ensure there is a clear line of sight from the financial forecasts in the operations and maintenance programme to the consolidated financial projections in Appendix E to the financials in the published LTP. 15. Provide additional commentary justifying the budgets arising from the maintenance and operations programmes. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

250 AECOM PNCC Asset Management Review Asset Management Review AMP's F-15 Assessment Item 7 Justification for asset renewal programme Score 3 Why is this important? Our Findings Asset Renewal Programmes are relied upon as a source of inputs to the Council s long term financial planning and the Council Long Term Plan. They should provide confidence that an optimum level of asset renewal is being carried out which will maintain an acceptable level of service capability of the asset systems, while maximising the value to be obtained from investment in the assets, and that asset renewal programmes are cost effective. The renewal of assets is covered in 6.9. The renewal programmes is determined from consideration of criticality, condition, and asset performance. There is a very good approach to prioritising asset renewals set out in Figure 29 based on age, diameter and criticality. Figure 28 sets out the remaining life profile of the wastewater pipe network. This appears to indicate that an average long term expenditure on renewals of the order of about $1.5m annually should be sufficient to sustain tha network. Table 23 sets out a 5 year forecast of wastewater renewals. Renewal programmes should be subject to systematic decisionmaking processes (ODM) to optimise these programmes. Roading AMPs should incorporate the NZTA Business Case Approach to ensuring appropriate and cost effective asset renewal programme. This appears to be at variance with the 30 year renewals budget set out in Table E2 There should be a clear line of sight from the asset renewal programmes in the AMP to the financial programmes in the LTP. The reasons and consequences of any inconsistencies between the AMP and the LTP should be stated Figure 32 sets out a 30 year renewal projection for the principal asset groups and compares this with depreciation. This appears to show a closer reconciliation with Table 23 than with Table E2. As would be expected proposed expenditure on renewals is significantly at variance with depreciation. While this simply reflects the condition and remaining life profiles of the assets, some additional commentary about this variance is desirable to dispel perceptions that an insufficient level of renewals is proposed. This is an issue that has been raised by Audit New Zealand in audits of other territorial authorities and should be addressed proactively in the AMP Opportunities for Improvement 16. Provide additional commentary on the variance between depreciation and the asset renewal projection to provide assurance that an appropriate level of renewals is planned which will maintain the overall service capability of the wastewater infrastructure. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

251 AECOM PNCC Asset Management Review Asset Management Review AMP's F-16 Assessment Item 8 Justification for asset development programme Score 2-3 Why is this important? Our Findings Asset Development Programmes are relied upon as a source of inputs to the Council s long term financial planning and the Council Long Term Plan. Asset Development Programmes close current and projected service gaps. They should provide confidence that an acceptable level of service capability will be maintained into the future. Asset development programmes should be subject to systematic decision-making processes (ODM) to optimise these programmes. Although the rate of closing service gaps is a political decision and is subject to competing demands for Council funding, it should be noted in the plans. Roading AMPs should incorporate the NZTA Business Case Approach to ensuring appropriate and cost effective asset development programme. There should be a clear line of sight from the asset development programmes in the AMP to the financial programmes in the LTP. The reasons and consequences of any inconsistencies between the AMP and the LTP should be stated All asset development proposals should be clearly linked to a current or anticipated service gap. This may be a customer or technical service gap and should ideally relate to a service standard that is defined in the AMP. The reason for this is that the purpose of asset development is to increase service capability. There would be no need to increase service capability if there was not (or not expected to be) a service gap. If levels of service are linked back to Community Outcomes/Council Objectives then by linking development proposals to service gaps it follows that these proposals will, if adopted contribute to the achievement of Community Outcomes, which is the intent of the LGA There is a discussion on service gaps in Section of the AMP. Service gaps appear to relate to Infiltration/inflow Trunk main capacity constraints. Some development projects in Development Programme reflect trunk main capacity constraints. The service gaps to which other projects relate is unclear. The development strategy described in is to provide for the progressive upgrading of assets to ensure future demand and changing service standards are achieved. An economic appraisal of proposed projects is required using cost/benefit analysis techniques which take into account: Capital costs Any change in net annual operating costs Any change in annual maintenance requirements Any salvage value of existing assets or components. A Project Execution Plan for is required for prior approval by the management team. Schedule 10 of the LGA 2002 requires capital development expenditure to be identified as being required to service gaps arising from a need to: meet additional demand for an activity (growth) improve the level of service. The Development Programme Budget in table 24 shows the proposed levels of expenditure in each category. Opportunities for Improvement 17. Provide a clearer link between the proposed development programme and current and projected gaps between target LOS shown in Section 4 of the AMP and current service capability. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

252 AECOM PNCC Asset Management Review Asset Management Review AMP's F-17 Assessment Item 9 Data Score 2 Why is this important? Our Findings Data supports fact based decision making, key asset management processes and performance measurement. It is important that organisations identify the data they require for these purposes, the quality of data they require, where they will obtain the data, and how they will manage and retrieve the data as required. They should also identify the quality of existing data relative to what is required and put in place a programme to improve data (where data quality gaps exist). This includes data on the assets, their condition and performance as well as other data needed to support business processes and decision making. The quality of asset management can only ever be as good as the quality of the underlying data. Data supports the entire asset management process. Ideally there would be an assessment made of the data required to support key asset management and decision making processes (including monitoring of performance), together with the required quality of this data, data sources and data collection mechanisms and arrangements for data management, retrieval and analysis. Analysis of gaps between the desired and current state of each data item would then form basis of data improvement programme. A summary of this assessment would be included in the AMP. Section 9.3 sets out an assessment of confidence in asset data used as a basis for the financial forecasts. This indicates a relatively high level of confidence in this data (B- reliable overall). It is also noted that there does not appear to be an assessment of confidence in unit rate data which also feeds into confidence in the capital programmes. Opportunities for Improvement 18. Add a subsection or appendix on data management which identifies the data required to support key asset management and decision making processes, required data quality, data sources, data collection mechanisms, data management arrangements and which incorporates a data improvement plan (if necessary) to close any gaps between current and target data availability and quality. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

253 AECOM PNCC Asset Management Review Asset Management Review AMP's F-18 Assessment Item 10 Confidence in programmes Score 2-3 Why is this important? Our Findings Programmes from AMPs are intended to support the sustainable long term provision of services. These programmes are relied upon as a source of inputs to the Council s long term financial planning and the Council Long Term Plan. It is therefore important that any issues with confidence in these programmes are known and disclosed. This typically involves identifying the inputs to the programmes and making an assessment of the accuracy of these inputs as a basis for estimating confidence in the programmes. The assessment should be documented. Section 9.4 sets out an assessment of the Reliability of Financial Forecasts. It would be expected that Section 9.4 would be derived from Section 9.3 Confidence Levels. The linkage between Section 9.4 and Section 9.3 is unclear from the AMP. It is also noted that there does not appear to be an assessment of confidence in unit rate data which would also affect confidence in the capital programmes. Ideally there would also be an assessment of confidence of other key projections in the AMP such as the demand projection. In Section 9.4 Reliability of Financial Forecasts assessments are made of the reliability of Maintenance and Renewal Forecasts and of Development Forecasts. The conclusions are that short to medium term forecasts are generally considered reliable with uncertainty increasing over the longer term. It is unclear how the assessments of confidence levels in data in 9.3 feed into the assessments of confidence in forecasts in 9.4 or what level of analysis has been carried out to reach the conclusions in Section 9.4. There needs to be an audit trail behind these assessments of reliability. It is useful to track actual variations from programmes over time as a reality check on assessments of confidence in the programmes. If for example the programmes are consistently coming in within +/- 10% of plan then this would confirm that an assessment of reliable is reasonable. Opportunities for Improvement 19. Improve the linkage between assessments of confidence in data and assessments of reliability in programmes and provide appropriate analysis to justify the assessments of confidence in projections and programmes. (the actual analysis could be appended or held outside the plan) 20. Track historic variations between programmes and actuals to provide a reality check on assessments of confidence in the programmes 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

254 AECOM PNCC Asset Management Review Asset Management Review AMP's F-19 Assessment Item 11 Performance Measurement Score 2 Why is this important? Our Findings AMPs set out how organisations will work to achieve their activity specific asset management objectives. It is important to close the loop and measure performance relative to these objectives. This includes performance relative to mandatory performance measures required under the Non-Financial Performance Measures Rules 2013 Monitoring performance relative to objectives helps identify areas where improvements may be required and areas where organisations may be overperforming. There may be scope for cost savings in such areas. Monitoring performance helps organisations compare their performance with that of comparable organisations By monitoring performance over time organisations are able to identify trends which may indicate a need for intervention. Current (2016/2017) performance (where available) is monitored for each of the Customer Levels of Service in Table 7 (Section 4 Levels of Service) and in Appendix C. Technical Performance Measures. Performance targets are provided for each of the years 2018/19 to 2020/21 and for the period 2021 to Current performance provides a snapshot in time of performance and a pass/fail indication of whether targets are being achieved (and by how much). This is of limited value as it does not provide an indication of performance trends whether it is improving, staying constant or declining, expected future performance, or how performance compares with that of comparable organisations. Ideally, performance results would be presented in graphical form which shows historic performance trends, current performance, expected future performance, performance targets and how these are changing over time and an industry benchmark (where available). Presenting performance results in this form enables managers to quickly make informed decisions about the need for intervention and anticipate issues that may be developing. The indicative graphs below show how performance results are typically presented in this way. Once systems are setup, reporting performance in this way is not onerous. Ideally there would be a separate performance section in the AMP presenting performance in this way. This will help readers make informed judgements about how the activity is performing. As indicated in Assessment Item 2, where there is a significant variation between actual and target level of performance or if a performance target has not been achieved there should be some form of commentary provided as this may indicate a need for some form of intervention. Results where a comment on the performance achieved may be appropriate are indicated in the table below: 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

255 AECOM PNCC Asset Management Review Asset Management Review AMP's F-20 Opportunities for Improvement 21. Present performance relative to customer LOS in in graphical form in the AMP which shows historic performance trends, current performance, expected future performance, performance targets and how these are changing over time and an industry benchmark (where available). 22. Consider adding a separate section on performance to the AMP setting out performance as suggested in OFI 21 above 23. Provide a commentary when a performance target is not achieved or when there is a significant variance between target and actual performance. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

256 AECOM PNCC Asset Management Review Asset Management Review AMP's F-21 Assessment Item 12 Sustainable Funding Score 1-2 Why is this important? Our Findings Long term expenditure projections are a fundamental part of AMPs. These should be matched by a projection of the level of funding that is required to sustain the activity over the long term. This is needed to close the loop. Long term funding projections should include funding to cover operating costs, asset replacement (if depreciation funding is used for this purpose it should be sufficient to cover long term asset renewals), interest on debt that will be needed to bridge periods when accumulated expenditure exceeds accumulated depreciation and funding to service debt associated with additional assets. These funding projections in the AMPs should be prepared in consultation with the finance manager. These funding projections should be updated regularly to take account of inflation and be based on realistic asset valuations. It should be possible to reconcile the long term sustainable funding projections in the AMPs with funding provided through the LTP and explanations should be provided for any significant variances between the two. Section 9.5 of the AMP covers the Funding Policy. This section sets out the basis of funding for the different categories of expenditure: Operation & Maintenance Capital Renewal Capital Development It also summarises the Council s approach to development contributions. Asset management is intended to support the sustainable long term provision of services. There is no indication given in the plan of whether the proposed level of funding in the AMP is sufficient to sustain the activity over the long term, whether it supports the principle of intergenerational equity and if significant changes in funding levels (excluding adjustments for inflation) will be required in the future. The financial forecasts in Appendix E set out long term (30 year) operating and capital expenditure projections. They do not give any indication of the funding that will be applied to the Activity (Apart from a relatively small amount of operational revenue shown in Table E1) or whether the long term budget for the Activity is balanced. Ideally the coverage in the plan of funding should go beyond the funding policy, it should show the long term levels of funding that will be necessary to sustain the activity over the long term. This will help highlight possible future funding problems (such as abrupt changes in the level of funding that will be required and indicate whether the Activity as described in the AMP is sustainable over the long term. Opportunities for Improvement 24. Consider adding long term funding projections to the plan showing the levels of funding that are expected to be necessary to sustain the activity. 0 - Innocent 1 - Aware 2 - Developing 3 - Fully meets requirements 4 - Exceeds requirements The AMP does not demonstrate any The AMP complies with good industry awareness of this requirement practice The AMP does not currently address this requirement (or covers it in a minimal way) but demonstrates an intent to progress it The AMP partly complies with good industry practice and demonstrates an intent to achieve full compliance with good industry practice The AMP exceeds compliance with good industry practice 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

257 AECOM PNCC Asset Management Review Asset Management Review AMP's F-22 Assessment Item 13 Readability Why is this important? Our Findings AMPs potentially have a wide range of audiences Asset Managers AMPs should actively guide asset managers in the management of asset based services Senior management AMPs should be readily comprehensible to senior management and provide senior management with a high level understanding of what the activity involves, what it is trying to achieve, any significant issues and risks the activity is facing, how it is managed and costs of the activity. Elected members - AMPs should be reasonably comprehensible to elected members, and provide elected members with a high level understanding of what the activity involves, what it is trying to achieve and why, any significant issues and risks the activity is facing, and costs of the activity. It should provide elected members with confidence that the activity is being well managed Interested members of the community - AMPs should be reasonably comprehensible to interested members of the community, and provide elected members with a high level understanding of what the activity involves, what it is trying to achieve and why, any significant issues and risks the activity is facing, and costs of the activity. Audit New Zealand - AMPs should provide Audit New Zealand with confidence that the activity is being managed appropriately It is therefore important that AMPs are readable and readily comprehensible It is stated in Section 1.1 Purpose of this Plan that the AMP is intended to be appropriate for a readership including elected members of the Council, executive management, interest groups, and business partners associated with the management of the Wastewater activity, along with interested members of the community. AMPs provide an opportunity for asset managers to demonstrate the quality of their management of asset based services. They should provide confidence to interested parties that the activity covered by the AMP is being well managed. For most audiences this necessitates a reasonably concise document. The Wastewater AMP contains the information that would be required by a diverse readership and conveys this information in a logical and comprehensible manner. It has continually developed and evolved over a number of years. Moving forward there is some detail in the plan which could be appended as part of the process of ongoing evolution of the AMP. Opportunities for Improvement 25. Consider transferring some of the more detailed information in the AMP to appendices as part of a process of evolution towards a higher level document (Note: no score is assigned to this item) 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

258 AECOM PNCC Asset Management Review Asset Management Review AMP's F-23 General Observations This is fundamentally a good AMP. It is logically structured and covers all elements that would be expected in an AMP for an activity such as a community wastewater service. The AMP demonstrates ongoing development and improvement over the years. It was pleasing to see in Section 2.2 Activity Rationale that the fundamental reason PNCC provides a wastewater network is to support the health and wellbeing of the community and that legislative requirements are only an underlying reason PNCC may wish to check compliance of their asset management policy (Section 3.4.1) and strategy (Section 3.4.2) with the requirements of the ISO Asset Management Standard. It is likely there will be an increasing expectation that organisations asset management practices are generally compliant with this Standard (but probably not of formal certification to the Standard). There would be merit in including a Management Review process as part of Section 11 Continuous improvement. Management Review Meetings, typically held at intervals of 3-6 months, consider the performance of the activity, significant issues that have arisen, customer feedback, and any other matters that are relevant to improving the management of the activity. They provide an opportunity to periodically take stock of how things are going and take appropriate action as may be appropriate. With the passing of the Health and Safety at Work Act 2015 the AMP may be a little light on identifying and managing Health and Safety risks associated with the wastewater infrastructure (apart from illness arising from contact with wastewater). PNCC and individuals within the Council may be exposed to liability in the event of harm to persons occurring which is associated with the wastewater infrastructure unless PNCC has identified risks associated with that infrastructure and eliminated or minimised those risks so far as is reasonably practicable.. The AMP should ideally include a projection of future asset values that will result from implementation of the programmes in the AMP. Audit NZ have raised this in audits elsewhere. A projection of future asset values which shows a declining trend in the overall value of the network may (but will not necessarily) indicate that there is an issue building with deferred renewals. A declining valuation over time would therefore need to be explained. The LGA 2002 requires any significant negative effects that may be associated with an activity to be identified. Section 2.5 covers Significant Negative Effects of the Activity This section sets out potential negative effects whereas it is only necessarily to state actual effects or effects that are likely to occur and only if these are considered significant. The process that can be followed to identify significant negative effects is to firstly define the criteria by which significance will be determined. This is normally the social cultural economic and environmental wellbeing of the community (this was previously specified in the LGA 2002 but has since been removed). Possible negative effects arising from the wastewater activity are then assessed (with current controls in place) relative to the criteria to determine which negative effects are significant. Only negative effects which have been identified as significant from a process such as this should be reported in the plan. The process itself should be appended. An example of an assessment of negative effects is set out below. This is only one of a number of possible approaches. 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A

259 AECOM PNCC Asset Management Review Asset Management Review AMP's 16-Apr-2018 Prepared for Palmerston North City Council Co No.: N/A F-24