Asset Management. (An Overview) Developing best practice asset management plans & programs RESEARCH 2017 PSD ALL RIGHTS RESERVED

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1 Asset Management (An Overview) Developing best practice asset management plans & programs RESEARCH CONSULTING SOFTWARE

2 Agenda Asset Management Overview A.M. Best Practice Key Components Ontario Regulation 588 / 17

3 The Original Framework What do we own and where is it? What is it worth? What condition is it in? What do we need to do to it? When do we need to do it? How much money do we need? How do we achieve sustainability? Two additional important questions: Do we still need it? How do we maintain sustainability? 3

4 Asset Management is Service Management The asset is the conduit for the service Infrastructure provides services that bring our cities to life Pipes provide a clean drinking water service Roads provide a transportation service Facilities and Parks provide recreation programs and services 4

5 The NEW Framework (Servicecentric) What are the organizational objectives? What assets are owned and what services do they provide? What is the assets value (to the organization and the community)? What is the asset s impact to service delivery (performance and risk)? What are the life cycle needs and available options? What are the work/budget prioritization processes? What are the financial strategies? What level of service is attainable? 5

6 What does asset management involve? Processes, procedures and practices to assist and define the management of infrastructure Achieving total lowest cost of ownership Established measures for performance, risk and cost (level of service) 6

7 Ontario Regulation 588 / 17 7

8 Asset Management key components 8

9 An Asset Management RoadMap Ont. Reg 588 / 17 Requirement 9

10 Current State of Maturity Analysis Assess performance across six key competencies: Organizational Cognizance Organizational Capacity Infrastructure Data/Information Asset Management Strategies Financial Strategies Levels of Service Asset Management Self-Assessment Test Departmental Interviews 10

11 Springwater s Assessment Asset Management Maturity Assessment Workshop December 7 th, 2017 Staff Attendees Robert Brindley, Chief Administrative Officer Jeff Schmidt, Director of Finance (AM Program Co-Lead) Heather Coleman, Director of Public Works (AM Program Co-Lead) Nick Ippolito, CBO, Director of Building Services Ron Belcourt, Director of Recreation, Parks & Properties Jeff French, Deputy Fire Chief Brent Spagnol, Director of Planning & Bylaw Services Renee Chaperon, Clerk Chris Chen, Manager of Financial Reporting & Budgets/Deputy Treasurer 11

12 Springwater s Current State of Maturity ASSET MANAGEMENT COMPONENT PROFICIENCY LEVEL NATIONAL AVERAGE Organizational Cognisance Intermediate Intermediate Organizational Capacity Intermediate Intermediate Infrastructure Data/Information Basic Intermediate Asset Management Strategies Basic Basic Financial Strategies Basic Basic Levels of Service Basic Basic Key Recommendations: Centralize and consolidate all infrastructure related data (inventory, condition, needs, prioritized requirements, financial data and GIS data) into a centralized asset registry database for the Township Work towards gathering assessed condition on the Township s core infrastructure assets and implementing routine condition assessment protocols 12

13 AM Policy Development The Problem / issue that needs to be addressed The purpose of this policy is to ensure the development of the Cities asset managemen program. The Players - the individuals and/or groups involved A course of action and/or principles Alignment to organizational objectives and goals Must address 12 components as per O Reg

14 The Evolution of Asset Data (AMP 2021 / 2023) Asset ID, location, description data Valuation data Condition data Performance (demand and capacity) data Risk data Maintenance data Life cycle activity data Optimized decision data Service based data 14

15 Asset Age vs Asset Condition 15

16 Condition Assessment Benefits (AMP 2021 / 2023) Better overall management practices Establishment of rehabilitation programs Prevents future failures / liability protection Repair schedules and preventive maintenance programs Extends asset service life - improves level of service Enables accurate asset reporting and better decision making 16

17 Risk / Criticality Assessment (AMP 2021 / 2023 / 2024) Risk = Probability of Failure X Consequence of Failure 17

18 Risk and Criticality Model Development Probability of Failure Age Consequence of Failure Road Failure Economic Impact Condition Social Impact Other Factors Environmental Impact 18

19 Risk Models Summary A good risk model will prioritize available resources Ensure vital services are available Prioritize and streamline inspection and condition assessment programs Prioritize and optimize operations and maintenance programs Prioritize and optimize capital budget processes and program delivery Ensure that available money and resources are applied to the right asset at the right time And will establish attainable levels of service 19

20 Lifecycle Management Strategy (AMP 2021 / 2023 / 2024) 20

21 Lifecycle Framework Development Asset Condition and Related Work Activity: Paved Roads CONDITION CONDITION RANGE WORK ACTIVITY EXCELLENT CONDITION (MAINTENANCE ONLY PHASE) MAINTENANCE ONLY GOOD CONDITION (PREVENTATIVE MAINTENANCE PHASE) FAIR CONDITION (REHABILITATION PHASE) POOR CONDITION (RECONSTRUCTION PHASE) CRACK SEALING EMULSIONS RESURFACE - MILL & PAVE RESURFACE - ASPHALT OVERLAY SINGLE & DOUBLE SURFACE TREATMENT (FOR RURAL ROADS) RECONSTRUCT - PULVERIZE AND PAVE RECONSTRUCT - FULL SURFACE AND BASE RECONSTRUCTION CRITICAL CONDITION (RECONSTRUCTION PHASE) 0 CRITICAL INCLUDES ASSETS BEYOND THEIR USEFUL LIVES WHICH MAKE UP THE BACKLOG. THEY REQUIRE THE SAME INTERVENTIONS AS THE POOR CATEGORY ABOVE. 21

22 Lifecycle Framework Development Road Lifecycle Activity Options TREATMENT AVERAGE UNIT COST (PER SQ. M) ADDED LIFE (YEARS) COST OF ACTIVITY/ADDED LIFE URBAN RECONSTRUCTION $ $6.83 URBAN RESURFACING $84 15 $5.60 RURAL RECONSTRUCTION $ $4.50 RURAL RESURFACING $40 15 $2.67 DOUBLE SURFACE TREATMENT $25 10 $2.50 ROUTING & CRACK SEALING (P.M) $2 3 $

23 Levels of Service (AMP 2021 / 2023 / 2024) Definition: A description of what end-users get from infrastructure and public services Cost Level of Service Performance Risk 23

24 Stakeholders and Roles Community Use municipal services Provide feedback Council Set organizational objectives Approve levels of service Staff Deliver service Track performance metrics 24

25 LOS Framework Development 25

26 Trends Influencing LOS Climate Change Increased rate of extreme weather events Aging Infrastructure Growing infrastructure deficit Fiscal Capacity Declining senior gov t grants Demographic Change Uncertainty around growth forecasts Trends in Service Usage Decline in water consumption Socio-political Expectations Evolving service expectations Organizational Change and Capacity High rates of retirement and staff turnover 26

27 Financial Strategy (AMP 2021 / 2023 / 2024) Determine your AMP financial requirements based on replacement costs & lifecycle interventions Analyse your financial capacity & optional funding streams Develop scenarios for consideration Proposed level of service analysis Make recommendations to council for approval 27

28 Ontario Regulation 588 / 17 28

29 Benefits of Asset Management Council awareness and involvement in the challenges of addressing the infrastructure deficit. Establishment of long term capital programs optimizing limited available funds Better communication amongst internal stakeholders and a focus on continuous improvement. A review of management practices & policies to better align with sustainable goals and level of service provision 29

30 Questions? 30