aim strategy(v7)

1

ASSET MANAGEMENT STRATEGY FOR

CAMPBELL RIVER – 2016

Prepared by: AIM Committee (Ron Bowles, Jennifer Peters, Drew Hadfield, Alaina Maher & Jason

Decksheimer)

Presented on: April 27, 2016

2

ASSET MANAGEMENT STRATEGY

EXECUTIVE SUMMARY

The Federation of Canadian Municipalities (FCM) stunned the government world in 2007 with its release of the report Danger Ahead:

The Coming Collapse of Canada’s Municipal Infrastructure.1 Since then, a new term “infrastructure deficit” has become synonymous

with municipal governance. The Canadian Infrastructure Report Card2 - a collaboration of the FCM and industry trade and professional

associations, first published in 2012 and updated early in 2016, outlines the state of Canadian municipal infrastructure. More

importantly, the 2016 report lays out a path for success. The report’s major findings are:

1) Municipalities own 60% of Canada’s core infrastructure with an estimated value of $80,000 per household;

2) One third of municipal infrastructure is in fair, poor and very poor condition, with 35% in need of attention;

3) Increasing infrastructure investment will reduce deterioration, with critical areas being roads, sidewalks, storm, water and

recreation;

4) Reinvestment will save money in the long-term as one dollar invested in the first 75% of the asset’s life eliminates or delays

spending of six to ten dollars on future rehabilitation; and

5) Communities will benefit from increased asset management capacity. 56% of medium-sized municipalities have a formal asset

management plan in place, 40% have a computer-based management system and 19% have a formal mechanism to factor

climate change into decision-making.

Given these findings, the Asset Infrastructure Management (AIM) Committee was formed to develop a framework for how the City of

Campbell River can achieve an active and functional asset management program. The formulated Asset Management (AM) strategy

identifies how the City can address current shortcomings, safeguarding City assets, assisting in decision making, and achieving a fully

integrated AM plan by 2021.

1 https://www.fcm.ca/Documents/reports/Danger_Ahead_The_coming_collapse_of_Canadas_municipal_infrastructure_EN.pdf 2 http://canadainfrastructure.ca/downloads/Canadian_Infrastructure_Report_2016.pdf

3


Locally, the City of Campbell River views asset management as an opportunity to use industry best-practices to tackle the looming

infrastructure deficit problem. In its 2015 Strategic Plan, City Council adopted a priority “We will plan proactively for the long-term costs

of maintaining our critical infrastructure.” To support this strategic item, the Asset Infrastructure Management (AIM) Committee has

been created. The Committee’s long range goal is to establish an active and functional asset management program for the City. The AIM

Committee will be taking a leadership role in the City to manage an enormous capital asset portfolio and tackle the growing

infrastructure deficit.

Campbell River is not alone and Asset Management B.C. has produced a roadmap for a successful implementation of a municipal asset

management program; the Guide for using the Asset Management B.C. Roadmap.3 This roadmap has been incorporated as the guiding

document for Campbell River’s asset management program. It will be a long-term endeavor for the City and the first task is to adopt an

Asset Management strategy.

The goals of the Asset Management strategy are to:

1) Lower infrastructure lifecycle costs;

2) Lower infrastructure failure risk;

3) Provide service and taxation stability;

4) Increase opportunity for government grant funding; and

5) Increase ability to manage impacts of climate change.

Together, let’s take AIM.

3 https://www.civicinfo.bc.ca/Library/Asset_Management/AM_Roadmap/Guide_for_using_the_Roadmap%20--AMBC--Sept_23_2011.pdf

4


AIM COMMITTEE MISSION

The City of Campbell River will be a leader in asset management to maintain our community assets to meet current and future service

needs. To lead this charge, the Asset Infrastructure Management (AIM) Committee will be tasked with meeting the ultimate goal of an

integrated asset management plan by 2021. The AIM Committee will develop a strategy and execute a process towards establishing,

implementing, auditing, refining and communicating a corporate-wide asset management system.

AIM COMMITTEE MANDATE (GOALS)

To develop a process for:

• Defining and recording information on physical assets

• Understanding replacement costs and condition assessments

• Defining acceptable risk and service levels

• Ensuring a corporate-wide, integrated asset replacement process

• Supporting the development of a stable long-term financial plan

• Communicating the steps, the obstacles and the successes of the asset management program internally

AIM COMMITTEE CHARTER (TERMS OF REFERENCE)

The AIM Committee is a cross-departmental, staff led group of technical and financial professionals committed to Council’s strategic

objective – we plan proactively for the long-term costs of maintaining our critical infrastructure. All decision making will be by

consensus. All policy and budget recommendations will be to Council, through the City Manager. All operational decisions will be

through the City Manager.

5


STRENGTHS

• Council strategic objective to improve infrastructure

management

• Some departments have started developing

components of an Asset Management program

• Good GIS system

• Asset experts on staff

• PSAB 3150 Tangible Capital Asset database for

baseline asset register information

• Some risk and condition assessments started

• Ability to raise funding

• AIM Committee

• Access to other municipal and industry best practices

• Eagerness at staff and department level to improve processes

WEAKNESSES

• Lack of accurate and complete asset registers for all asset

categories

• High proportion of assets at or beyond expected lifespan

• No standardization of Asset Management practices or protocols

between departments

• Capital planning decisions frequently made by professional

judgement, not knowledge based condition/risk assessment

• Limited condition assessment information on many assets

• Undefined community service needs relating to asset condition

• Lack of clarity on AM benefits/outcomes

• Limited defined service levels for municipal services

OPPORTUNITIES

• Improved capital renewal decision making process

• Surety and consistency in future service levels

• Stable taxes and fees

• Improved maintenance practices resulting in extended asset

lifespan

• Community/Council defined service levels

• Funding dictated by renewal needs, not vice versa

• Most efficient use of scarce financial and staff resources

• Risk levels defined for all asset categories

• Most accurate asset registers / condition information available

THREATS

• Asset failure resulting in reduced or interrupted

services

• Increased financial, safety, environmental and

health risks

• Legislated mandate of other levels of government

• Reduced access to government grants

• Reduced employee morale and corporate image

• Limited resources to implement Asset Management

program

• Unstable and unforeseen tax/fee increases for

capital renewal

• Decisions made without formal risk/condition

assessment information

6


ASSET MANAGEMENT B.C. PREPAREDNESS SELF-ASSESSMENT4

Major asset categories were scored from 1 to 4 on 21 different criteria, ranging from key attribute data to decision making. The City of

Campbell River self-assessment results are:

1= No capacity 2 = Fair capacity 3 = Good capacity 4 = High capacity

4 http://www.civicinfo.bc.ca/Library/Asset_Management/Tools_and_Resources/AssetSMART_2%20-_A_Local_Government_Self_Assessment_Tool--LGAMWG--

September_2015.pdf

1

2

3

4

Roads Storm Facilities Fleet Parks Water Wastewater

Asset Category

City of Campbell River Self Assessment

7


ASSET MANAGEMENT B.C. GAP ANALYSIS5

A comparison between current practise at the City of Campbell River and the Asset Management B.C. Roadmap identified the

following gaps in AM practices:

1.0 Know Your Assets

Gap 1 No master asset list including asset type, location, quantity/size, material, useful life, install date and remaining life.

Gap 2 No componentized asset inventories for all asset categories.

Gap 3 No formal decision making tools, consistent data/asset management database for all asset categories. Varied data sources.

Gap 4 No linkage or consistency between various data sources, GIS and financial information.

Gap 5 No single department or person responsible for asset management data management, accuracy and process.

2.0 Know Your Financial Situation

Gap 6 No list of depreciated and replacement costs for all asset classes.

Gap 7 No componentized or fully reliable historical operations or repairs and maintenance costs.

Gap 8 Future capital planning based on historical spending and not on a data supported replacement plan.

3.0 Understand Decision Making

Gap 9 Very limited formal (written) decision making processes, across the whole organization.

Gap 10 No improvement plan or consideration of desired decision making process.

5 http://www.civicinfo.bc.ca/Library/Asset_Management/AM_Roadmap/Roadmap_Diagram--AMBC--Sept_23_2011.pdf

8


4.0 Manage Your Asset Lifecycle

Gap 11 Almost no current condition information or rating across all asset classes.

Gap 12 Other than regulatory, very little stated levels of service. Applies across organization, particularly relating to assets.

Gap 13 Minimal formal renewal or replacement decision process, particularly regarding maintenance practices.

5.0 Know the Rules

Gap 14 Limited proactive stakeholder engagement.

Gap 15 Very limited internal/operational goals, performance measures and strategic priorities.

6.0 Sustainability Monitoring

Gap 16 Sustainability (Financial/Environmental/Social) reporting is at a high-level and without measurable, direct and operational

action plans.

Gap 17 Renewal coordination is done on a project by project basis, not on a whole system asset class basis.

9

ASSET MANAGEMENT STRATEGY EXECUTION

2015 - 2017

2015

• AM strategy

• Reserve restructure

• 10 year financial plan

2016

• Implementation & resourcing plan

• Debt policy

• Identify electronic data platform

2017

• Central asset registry

• Replacement values

COMMUNICATION & STAKEHOLDER ENGAGEMENT

10

ASSET MANAGEMENT STRATEGY EXECUTION

2018 – 2021

2018

• Condition assessments & ratings

• Service levels (current & future)

2019

• Risk assessments

• First draft AIM plan (beta)

2020

• AIM policy

2021

• Long term financial plan (20+ years)

• Integrated AIM plan

COMMUNICATION & STAKEHOLDER ENGAGEMENT

11


ASSET MANAGEMENT B.C. FRAMEWORK6

6 http://www.assetmanagementbc.ca/framework/