FACING THE INFRASTRUCTURE CHALLENGE 2...· Prime Minister Stephen Harper. January 11, 2006. Edmonton...
Transcript of FACING THE INFRASTRUCTURE CHALLENGE 2...· Prime Minister Stephen Harper. January 11, 2006. Edmonton...
FACING THE INFRASTRUCTURE CHALLENGE 2 Figure1:Edmonton’sinfrastructureassetsbyclass,withreplacementvalue* 3
Emergingissues 4 Figure2:Averageageandexpectedlifeofinfrastructureassets,byclass. 4 Figure3:Factorswithanimpactoninfrastructureandservicedelivery 5
Thefinancial‘bigpicture’ 5 Figure4:2006-2015LongRangeFinancialPlanandtheinfrastructuregap 5
Helpfromtheotherordersofgovernment 6
Edmonton’sstrategicapproach 7 Figure5:StatusofEdmonton’sinfrastructureassets 7
DEVELOPING SOLUTIONS 9
EDMONTON CITY COUNCIL’S INFRASTRUCTURE STRATEGY 10
Council’sVision 10
Administration’sMandate 10
GuidingPrinciples 10
Goals 11
LONG-TERM TACTICS AND ACTIVITIES 12
Goal1:Defineneeds:Evaluateandreportthestateofinfrastructureassets 12
Goal2:Developsolutions:Implementsustainableinfrastructureassetmanagementpractices 13
Goal3:Securefunding:Ensureadequatefiscaltoolsandresourcestofundinfrastructureassets 14
APPENDIX A: INFRASTRUCTURE ASSET MANAGEMENT DEFINITIONS 15
Table of Contents
2 EdmontonCityCouncil’sInfrastructureStrategy
OurCity’sinfrastructureandprocessesmustrespondtotheneedsofagrowingpopulationandeconomy.WeneedtosupportandenhancetheinfrastructureassetsthatmakeEdmontonmorethanaplacetowork:theseassetsmakeourCityaplaceforcurrentandfuturegenerationstobuildtheirlives.
· Mayor Stephen Mandel. January16,2005.
Thesinglebiggestchallengefacingmunicipalitiestodayisfindingfundingformuch-neededupgradestoagingoroutdatedinfrastructure,andforgrowth-relatednewinfrastructure.
· Honourable Rob Renner, Minister of Municipal Affairs SpeechtotheAlbertaAssociationofMunicipalDistrictsandCountiesSpringConvention,April6,2005.
Infrastructureisacrucialinvestmentinoureconomicproductivityandqualityoflife.Itisthesinewofournationaleconomy–awebofconcrete,steel,andfibreopticsthatbindsourcountrytogether,andbringsourcountrytotheworld.Toharnessoureconomicpotential,Canadamustaddressitsnationalinfrastructuredeficit.
· Prime Minister Stephen Harper. January11,2006.
EdmontonCityCouncil’sInfrastructureStrategy 1
2 EdmontonCityCouncil’sInfrastructureStrategy
Acity’srelativehealthcanbemeasuredbytheabilityofitsinfrastructuretomeetcitizens’needs.Infact,thepropermanagementofinfrastructurehelpstocreatethetypeofcityinwhichwewanttolive,workandplay.
Fewofusthinkaboutthecrucialrolemunicipalinfrastructureassetsplayinourday-to-daylives.Weassumepotholeswillbefilledandtrafficsignalswork;wetakeforgrantedthatwastewaterisproperlytreatedbeforeitisreleasedintotheriver;wetrustthattheparksandpoolswhereourchildrenplayaresafeandwellmaintained.Likeanyresponsiblehomeowner,theCityhasaplantomanageitsinfrastructureassetsinordertomanagegrowth,encourageeconomicdevelopment,andprotectpublicsafety.
Facing the infrastructure challenge
Economicsuccesstoday,andevenmoresointhefuture,willrequiremanythings,andamongthemaresustainable,well-financed,andworld-classbigcitiesthatattractandretainthebestandthebrightest.Futuresuccessmeansbuildingbigcitiesthatcanmeethighexpectationsandloftyaspirations,aswellaseffectivelyandefficientlydeliveringahighqualitypackageofmunicipalservicesandgoodqualityinfrastructureatanaffordableprice.
·Rationale for Renewal. CanadaWestFoundation,September2005.
EdmontonCityCouncil’sInfrastructureStrategy �
ASSET CLASS DESCRIPTION REPLACEMENT VALUE % OF TOTAL
Drainage Sanitary,stormandcombinedsewers(includesmanholesandcatchments),andwastewatertreatment.
$8.41billion 42%
Road right-of-way Roads(arterial,collectors,local;curbsandgutters),sidewalks,bridges,gates,streetscapes.
$6.37billion 31%
Parkland Horticulture,trails,hardsurfaces,playgrounds,sportsfields,parksandassociatedinfrastructure(climbinggyms,etc.).
$1.48billion 7%
Transit facilities and equipment
LRTsystemfacilitiesandequipment,transitcentres,busequipmentandsystems,trolleysystem.
$1.02billion 5%
Buildings Civicoffices,publicworksyards,emergencyresponseandpolicebuildings,andlibraries.
$674million 3%
Fleet Transitbuses,cityvehiclesandautomotiveshopequipment. $611million 3%
Traffic control and lighting Trafficsignals,signs,streetlightingandparkingmeters. $540million 3%
Recreation facilities Arenas,leisurecentres,swimmingpools,FortEdmonton,ValleyZoo,etc. $534million 3%
Affordable housing Non-profithousing,communityhousing,andseniorslodges. $220million 1%
Waste management facilities Administrativefacilities,transferstations,processingfacilities,landfilloperations. $185million 1%
Technology equipment Servers,networks,allcommunicationequipment. $107million 0.5%
Others Emergencyresponseandpoliceequipment,librarycontents. $91million 0.5%
Total replacement value $20.2 billion 100%
Edmonton’sinfrastructureassets,whichhaveareplacementvalueof$20billion,includeroads,sewerlines,transit,emergencyresponsevehicles,swimmingpools,parks,informationtechnologyandmore.Alltheseassetsmakevitalcontributionstoourqualityoflife.
*Allfigureshavebeenrounded.
Figure 1: Edmonton’sinfrastructureassetsbyclass,withreplacementvalue*
� EdmontonCityCouncil’sInfrastructureStrategy
Emerging Issues
Thejobofbuildingandmaintainingtheseinfrastructureassetsisbecomingincreasinglydifficult.ManyofEdmonton’sinfrastructureassetswerebuilteitherinthe1950sor‘70s.Asaresult,theaverageageofEdmonton’sinfrastructureisover30yearsandtheaveragelifeexpectancyofinfrastructureassetsis50years.Havingpassedthehalfwaypoint,theCityisapproachingacriticalperiodtoensurethatitsinfrastructureassetscontinuetomeettheneedsofEdmontoniansinthefuture.
Inaddition,eachyearthousandsofnewresidentsflocktotheEdmontonregiontotakeadvantageofemploymentopportunitiescreatedbyourthrivingeconomy.Personaldisposableincomeisontheriseandlowinterestrateshaveresultedinanextremelyhealthyhousingmarket–similartothebuildingboomofthe1970s.
Edmontonhasgrownbymorethan46,000personssince2001,whichislikeaddingtoitspopulationanentirecitythesizeofMedicineHat.Thispopulationgrowthhasasignificantimpactoninfrastructurerequirements.Inthesamewaythatagrowingfamilymayfindthatithasbecometoolargeforatwo-bedroomhome,theCitymustbuildnewinfrastructuretosupportitspopulationgrowth.
Edmonton’ssituationisalsouniquebecausethereare21municipalitiesintheimmediateregionaccountingforalmost300,000additionalpeople.Mostpeoplebenefitfromlivingincloseproximitytotheprovincialcapital,whichprovidesbig-cityservicesandopportunitiesthatwouldbeotherwiseinaccessible.
TensofthousandsofresidentsfromneighbouringmunicipalitiestraveltoEdmontoneverydayandsupportEdmonton-basedbusinessesthat,inturn,paylocalpropertytaxes.However,thiseconomic
activityalonedoesnotnecessarilyprovideacontributionequaltotherevenuerequiredtopreserveandmaintaintheCity’sinfrastructureusedbytheseresidents.
OtherfactorsthathaveanimpactonEdmonton’sinfrastructureincludedemographicchanges(agingpopulation,changingresidentialandmovementpatterns),politicalrelationships(changingrelationshipswiththefederalandprovincialgovernments),environmentalimpacts(suchasratificationoftheKyotoAccordandstricterpollutioncontrols),socialandculturalissues(low-costpublichousing,servicestotheeconomicallydisadvantaged)and
newtechnologiesthatinfluenceservicedeliverytocitizens.
Alberta’shealthyeconomyhasalsoledtohighlevelsofprivateinvestmentintheoilsandsandotherindustrialsectors,aswellasplansfromtheprovincialgovernmenttoimprovetransportationcorridorsandbuildnewschoolsandhospitals.Thishasfueledsubstantialinflationaryincreasesintheconstructionsector;adollartodaydoesnothavethesamepurchasingpowerthatitdidthreeyearsago.Edmontonmustcarefullymanageitsinvestmentininfrastructuretoensureitgetsvalueforeverydollar.
Canadiansknowwhattheywantfortheircommunities.Butwherewehopetoseeclean,green,productiveandwell-runmunicipalitiesandtowns,weseeagrowinggapbetweenwhatisandwhatcouldbe.Weseethesignsofdecline,thewearandtearthatsignalstrouble.
·Quality of Life in Canadian Municipalities: Highlights Report 200�.FederationofCanadianMunicipalities,April2004.
Figure 2: Averageageandexpectedlifeofinfrastructureassets,byclass
EdmontonCityCouncil’sInfrastructureStrategy 5
Alltheseissuesmakeinfrastructuremanagementanincreasinglydifficulttask.Respondingeffectivelyrequiresastrategicapproach,onethatbridgesthespacebetweenpolicy,asdeterminedbyCityCouncil,andservicedelivery,asperformedbytheAdministration.EdmontonCityCouncil’sInfrastructureStrategyhelpstoprovidethatbridgeandincludesactiontosupporttheimplementationofnewpoliciesandpracticesthatwillsupportlong-termmunicipalsustainability.
The financial ‘big picture’
In1998,theCity’sLongRangeFinancialPlan(LRFP)identifiedan‘infrastructuregap’–thetotalcapitalinfrastructureinvestmentrequiredoveraten-yearperiodcomparedtoavailablerevenues–thatexceededtheCity’sabilitytobridgeexistingrevenuesourcesandmanagementpractices.
CityCounciladoptedEdmonton’sfirstInfrastructureStrategyin1998asastrategicresponsetothewideningdisparitybetweennecessaryinfrastructureinvestmentandavailablefunding.
Figure �: Factorswithanimpactoninfrastructureandservicedelivery
Figure �: 2006-2015LongRangeFinancialPlanandtheinfrastructuregap
� EdmontonCityCouncil’sInfrastructureStrategy
The2006-2015LRFPidentifiestotalcapitalspendingof$8.6billion.Ofthattotal,nearly56percentor$4.8billionis‘funded’;thatis,theCityhasidentifiedrevenuefromtaxes,grantsanduserfeestopayforprojectswiththisvalue.Thecorresponding‘unfunded’portionoftheLRFP,whichisthevalueoftheinfrastructuregap,isapproximately$3.8billion.
Ofthe$3.8billionunfundedinfrastructuregap,nearly$1.7billion(44percent)isrequiredtorehabilitateexistinginfrastructure,$2.1billion(55percent)isrequiredtofundgrowthprojects,andtheremaining$30million(onepercent)forotherprojects.
ThispersistentcapitalfundingshortfallmeansthattheCityhasbeendeferringmaintenanceonexistinginfrastructureassetsanddelayingtheconstructionofnewassets,eventhough
delaysarecostly,becauseitsimplydoesnothaveenoughrevenuetomeetidentifiedneeds.
Municipalinfrastructureexpertsrecommendthatmunicipalitiescommitbetweentwoandfourpercentoftheirtotalinfrastructureassetvalueeachyeartorehabilitation.ForEdmonton,withassetsvaluedatslightlymorethan$20billion,thisbenchmarkwouldtranslatetoanannualreinvestmentofbetween$400and$800milliontorehabilitateexistinginfrastructure.Overthenext10years,however,theCityhasthecapacitytospendonlyabout$260millionannuallyforrehabilitationandreplacement–slightlymorethanonepercentoftheassetreplacementvalueandsignificantlybelowtherecommendedtwotofourpercent.Thelongerthatrequiredrehabilitationisdeferred,themoreexpensiveitbecomestobringassetsbacktoanacceptablecondition.
CurrentreinvestmentratescannotpreservetheCity’s$20billioninvestmentinexistinginfrastructureinitscurrentcondition,norcancurrentbudgetskeeppacewithEdmonton’srequirementsandprojectedgrowth.
Help from the other orders of government
Municipalrevenues,whichareoverlyreliantonpropertytaxes,cannotpreserveexistinginfrastructureorsustaingrowthprojections.Chronicunderfundingcreatesabacklogofdeferredcapitalprojectsandimpairsthe
City’sabilitytomaintaincurrentservicelevels.Thesecombinetoreduceourabilitytosupportgrowthandeconomicdevelopment.
Overthenextdecade,Edmontonwillreceiveroughly$1.5billionincombinedcommitmentsfromthefederalandprovincialgovernments.Thefederalgovernmentagreedin2004torefundtheGSTtomunicipalitiesandtoshareapercentageofthefederalgasolinetax.In2005,theprovincialgovernmentcommitted$3billioninnewinfrastructurefundingtoAlbertamunicipalitiessharedonapercapitabasis,whichmeansthatEdmonton’seventualsharewilldependoncensusdata.
ThoughthereisnosinglesolutionthatwillalleviateEdmonton’sinfrastructurechallenges,persistenceiscrucialastheCityexploressuitablerevenuesourcesandmorecost-effectiveapproachestomanagetheinfrastructuregap.
·Thinking Outside the Gap: Opportunities to Address Edmonton’s Infrastructure Needs.ReportoftheOfficeofInfrastructure,CityofEdmonton,December2004.
EdmontonCityCouncil’sInfrastructureStrategy �
ThisnewfundingenablesCityCounciltopursueprojectsthatwouldotherwisehavebeenindefinitelydeferred,suchasthe23rdAvenue/GatewayBoulevardinterchange,thesouthernextensionoftheLRTtoCenturyPark,busrapidtransit,neighbourhoodinfrastructure,floodpreventionandnewemergencyfacilities.
Theimportanceofthisnewfundingcannotbeoverstated;atthesametime,itcannotbedeniedthatEdmontonstillhasasignificantshortfall.Edmontoncontinuestofaceadelicatebalancingact–itmustmaintain
andreplaceexistinginfrastructurewhiledealingwithincreaseddemandstosupportgrowth,andthatmeansmarryingnewfiscalgoalswithimprovedinfrastructureassetmanagement.
Edmonton’s strategic approach
Comprisedofsixprincipalstrategiesandninesupportivestrategies,theCity’sfirstInfrastructureStrategywasintendedtoensurethat:
·municipalinfrastructureisinagoodstateofrepair;
·rehabilitationanddevelopmentprogramswereadequatelyfunded;and
·thedifferencebetweencapitalrequirementsandavailablefunding–theinfrastructuregap–isaddressed.
AkeycomponentofEdmonton’sInfrastructureStrategywasthecreationin2000oftheOfficeofInfrastructure.Overthepastfiveyears,theOfficehas:
·createdandmaintainedacomprehensiveinventoryoftheCity’sofinfrastructureassets;
·coordinatedregularupdatesoftheCity’sinventoryandinvestmentneedstoCityCouncileverytwoyears;
·developedandimplementedstrategiestoaddresstheinfrastructuregap;
·coordinatedtheinfrastructurefundsreceivedfromfederalandprovincialprograms.
Tomakesurethatlimitedcapitalresourcesarewiselyinvested,Edmontonhasdevelopedorisintheprocessofdevelopingavarietyofinnovativeinfrastructureassetmanagementtoolsthatinclude:
·arankingsystemtoevaluatethestateandconditionofexistinginfrastructureassetsofallclasses;
·ariskassessmentmethodologytoquantifytheriskofassetfailureandrelatethisrisktoinvestmentlevels,and
·alifecyclecostmethodologytosupportbetterdecision-makingandlong-termplanning.
OverthepastfiveyearstheCityhasseengreaterintegrationofitsinfrastructuremanagement,budget,andplanningprocesses.ThisintegrationbetterenablestheCitytoprioritizeinfrastructureinvestmenttomatchcitizendemandsandprogramneeds.TheOfficeofInfrastructurehelpsCitydepartmentsdefinethecostsassociatedwithassetmaintenance,
rehabilitationandconstruction.Asaresult,theCitywillbeabletomoreaccuratelypredictitsbudgetrequirementsinboththeshort-andlong-term.
Figure 5: StatusofEdmonton’sinfrastructureassets
Municipalitiescontinuetofacefinancialpressuretorepairorreplaceexistinginfrastructure.Somemunicipalpropertytaxassessmentbasesaredecliningwhileothermunicipalitiesfacerapidgrowthpressures.Municipalitiescontinuetoindicatethatcurrentfundinglevelsandrevenuesourcesmaynotbeadequatetomeetserviceorinfrastructuredemands.
· Alberta Municipal Affairs Business Plan 200�-200�.
� EdmontonCityCouncil’sInfrastructureStrategy
Edmontonhasadoptedothermeasurestohelpdealwithitsinfrastructurechallenges.TheSanitaryServicingStrategyFund,apartnershipforgedbetweentheCityanddevelopersin1998,collectsfeesfromdevelopersthroughchargesappliedtonewneighbourhoodsanddevelopments.Thefundfinancestheconstructionofmajorsanitarysewersandmakesitpossiblefordevelopmentinnewcommunitiestoproceed.
ArterialRoadwayAssessmentsisanothertoolusedbytheCitytopayforroadinfrastructureassociatedwithagrowingcity.Theseassessmentsrequirethatdeveloperspayforthefirsthalfofanarterialroadwaylocatedwithinapredeterminedarea.
Itshouldalsoberecognized,however,thateventhoughtheinitialcapitalinvestmentispaidelsewhere;therearelifecycleoperation,maintenance,rehabilitationandreplacementcoststhatneedtobeaddressedwhentheCityassumesownershipoftheseassets.
In2002CityCouncilamendedtheDebtManagementFiscalPolicytopermitborrowingofupto$50millioneveryyearoverfiveyearstofundlarge-scale,high-priorityinfrastructureprojects.
TheCityalsoconvertedlanddrainagetoautilityin2003,enablingthedrainagenetworktobecomeaself-supporting,user-paysystemindependentofpropertytaxes.
Edmonton’sstrategicapproachtoinfrastructureassetmanagementhasledtoitsinternationalrecognitionasoneofNorthAmerica’smostprogressivejurisdictionsbysuchauthoritiesastheInstituteofPublicWorksEngineeringAustralia;theFederalHighwayAdministration;theAmericanAssociationofStateHighwayandTransportationOfficials;CanadianPublicWorksAssociation;CanadianSocietyofCivilEngineers;Transport,InfrastructureandCommunitiesCanada;andtheFederationofCanadianMunicipalities.
TheCityofEdmontonhasalsobeenapproachedbymanymunicipalitiesacrossCanada,theUnitedStatesandAustraliawhowishtolearnmoreaboutitsinnovativeapproachtoinfrastructureassetmanagement.
TheOfficeofInfrastructurehasgreatlyenhancedtheCity’sawarenessandunderstandingoftheinfrastructurechallengeitfaces.WiththeadoptionofthenewInfrastructureStrategy,CityCouncilhasshiftedEdmonton’sfocusfrom‘definingtheproblem’to‘developingsolutions.’
Thepotentialcostsoffailingtoaddressthe[infrastructure]issueincludehigheroperatingcostsforgovernmentandbusiness,negativeimpactsontheenvironment,threatstopublichealthandsafetyaswellasothersocialcosts,losteconomicpotentialandproductivity,andmostimportant,theprospectofevenhighercapitalcostsinthefuture.Clearly,theissueisonethatneedstobeaddressed.Giventhepotentialmagnitudeoftheproblemandthecostsoffailingtoact,thisisnotimetobetimid.
· No Time to Be Timid: Addressing Infrastructure Deficits in the Western Big Six.CanadaWestFoundation,February2004.
EdmontonCityCouncil’sInfrastructureStrategy 9
TheOfficeofInfrastructurehasworkedwithCityCouncil,seniormanagers,administrativestaffandexternalstakeholdersoverthepasttwoyearstorevisetheInfrastructureStrategy.Threefundamentalsustainabilityobjectiveshaveemergedoutoftheseconsultations.
1.Balancetheallocationofavailableresourcesbetweenrehabilitationandgrowth.
2.Increaseoperationsandmaintenance,rehabilitationandreplacementfundingtocorrespondtonewassetsaddedtotheinventory.
3.Addressthebacklogofdeferredrehabilitationprojects.
Eachoftheseobjectivesdependsontheavailabilityofadequateandsustainablefunding.
EdmontonCityCouncil’sInfrastructureStrategyprovidesthedirectiontoaddresstheseobjectivesandtosupportlong-terminfrastructureinvestmentandreinvestmentstrategiesthatwillmaintaintheCity’sassetsintothefuture.
Inaddition,theStrategyalsocommitstheCitytodevelopnewtoolsthatfurtherenhancetheinfrastructuremanagementsystemacrossthecorporation.TheStrategysupportscontinuedcollaborationamongtechnicalplanners–thosewhopropose,designandbuildinfrastructureassets–andfinancialdecision-makers.
Giventhatsoundinfrastructureisessentialtosupportanycommunity’sgoalsforgrowth,economicdevelopment,andpublicsafety,ourabilitytobuildandproperlymaintainourinfrastructureisessentialtoensureEdmontonremainsanattractiveandcost-effectiveplacetoliveanddobusiness.
Edmonton’s leadership and innovation
EdmontonisoneofthefirstcitiesinCanadatohavecapturedacomprehensiveinventoryofitsinfrastructureassetsandtohaveimplementedarankingsystemtoevaluatethestateandconditionofexistinginfrastructureassets.BoththeFederationofCanadianMunicipalitiesandtheAlbertaUrbanMunicipalitiesAssociationareencouragingtheirmemberstodevelopaninfrastructureassetinventoryandratingsystem.
Physical condition:Theconditionofanassetthatenablesittomeetintendedservicelevels(e.g.theintegrityofadrainagesystem).
Demand/capacity:Thecapacityofaninfrastructureelementtomeetservicerequirements(e.g.theabilityofaparticularroadtohandletrafficflow).
Functionality:Theabilityofaninfrastructureelementtomeetprogramdeliveryrequirements(e.g.whetherornotarecreationfacilitymeetsuserexpectations).
TherankingsystemhelpsCityCouncilandtheAdministrationtocomparetheconditionofdisparateinfrastructureelements–roadstodrainageorparkstoinformationsystems–andimprovesthequalityofinformationusedtomakemoreinformeddecisionsandestablishpriorityprojects.
Developing solutions
10 EdmontonCityCouncil’sInfrastructureStrategy
EdmontonCityCouncil’sInfrastructureStrategyarticulatesCityCouncil’scommitmenttodevelopandmaintaintheCity’sinfrastructureassets,whichsupportthedeliveryofprogramsandservicestocitizens.
TheStrategywasfirstdevelopedinresponsetoagrowingunderstandingoftheCity’sinfrastructuregap.
Advancedmanagementtechniques,manyofwhichhavebeendevelopedinEdmontonandattractedinternationalattention,helpCityCouncilmakemoreinformeddecisionsandusescarceresourcesmoreeffectivelytoaddresschallenginginfrastructuredemands.
MoreeffectiveinfrastructureassetmanagementwillhelptheCitytoprovidecost-effectivemunicipalservices,promoteeconomicdevelopment,ensurecitizenhealthandsafety,protecttheenvironment,andsupportahighqualityoflifeforallEdmontonians.
Council’s Vision
Sustainableinfrastructure,maintainedthroughsoundfinancialpoliciesandassetmanagementpractices,willcontributetothevibrancyoftheCity’seconomy;thevitalityofitsneighbourhoods;safetyofitscitizens;protectionoftheenvironment;anditscapacitytoaccommodategrowth.
Administration’s Mandate
Toensurethatprogramstorenew,upgradeandexpandinfrastructureassetsaresustainableandsupporttheCityofEdmonton’splansandpriorities.
Guiding Principles
1.Infrastructureassetsshouldbesocially,environmentally,andeconomicallysustainable.
2.Infrastructureassetsarecriticaltoeconomicdevelopmentandqualityoflife.
3.InfrastructureprogramsshouldsupportthevaluesandobjectivescontainedinplansandprioritiesapprovedbyCityCouncil.
4.Infrastructureisacapitalinvestmentandmustberesponsiblymanaged.
5.Infrastructureassetsmustbemaintainedinaconditionthatenablesthemtoperformtheirintendedfunctions.
6.InfrastructureassetmanagementwillhelptheCitytobalancerenewal,upgradingandexpansionprograms.
Edmonton City Council’s Infrastructure Strategy
EdmontonCityCouncil’sInfrastructureStrategy 11
Goals
ThreeprimarygoalsweredevelopedtosupporttheimplementationofEdmontonCityCouncil’sInfrastructureStrategy.
Goal 1: Define needs Evaluateandreportthestateofinfrastructureassets.
Keyactionitems
1.1 Maintainanassetinventory,valuationandconditionratingsystemforallmunicipalinfrastructure.
1.2 Determinethecurrentandprojecteduseofinfrastructureassetsandrelatedcosts.
1.3 Developaprocesstoevaluatelevelsofservice.
1.4 Reportinfrastructureperformanceinthemeetingofbroadersocial,environmentalandeconomicobjectivesoftheCity.
1.5 Communicatetothepublicthescope,valueandimportanceofinvestmentininfrastructure.
Goal 2: Develop solutions Implementsustainableinfrastructureassetmanagementpractices.
Keyactionitems
2.1 Developandapplyevaluationtoolsthatenhancecorporatepoliciesandsupportinfrastructureinvestmentdecisions.
2.2 Evaluateapproachestosustainableservicedelivery.
2.3 Developalong-termfinancialstrategytosupportinvestmentinexistingandnewinfrastructure–operationsandmaintenance;renewal,upgradingandexpansion.
2.4 Encouragethebalancedallocationoflimitedinfrastructureresources.
2.5 Researchinfrastructuremanagementandservicedeliverybestpractices.
Goal �: Secure funding Ensureadequatefiscaltoolsandresourcestofundinfrastructureassets.
Keyactionitems
3.1 Pursuealternativesourcesofrevenue.
3.2 Reviewsharedservicedeliveryandcost/revenue-sharingmechanismswithintheCapitalregion.
3.3 Encourageeffectivecoordinationwithotherserviceproviders(powerandwater,cable,schoolboards,etc.).
3.4 Collaborateonkeyinvestmentsbyotherordersofgovernment,institutionalstakeholders(UniversityofAlberta,GrantMacEwan,NAIT,CapitalHealthAuthority,etc.),thedevelopmentindustryandnon-governmentalorganizations.
12 EdmontonCityCouncil’sInfrastructureStrategy
Long-Term Tactics and Activities
Thetactics/activitiesandtheiranticipatedoutcomesassociatedwiththeGoalsoftheInfrastructureStrategy2006aredescribedinthefollowingsectionandaretobeundertakenbytheAdministrationasawhole.
KEY ACTION ITEMS TACTICS AND ACTIVITIES OUTCOMES
1.1 Maintain an inventory, valuation and condition rating system for municipal infrastructure.
· Acquirebuy-infromnecessarypartners.
· Involvedepartmentsindevelopmentandapplicationofinventoryandratingsystem.
· Establishaprocesstomaintain,updateandreportinventoryannually.
· Addressthebasicelementsofassetmanagement.
Aqualityinfrastructureassetmanagementinventorythatwillprovidedecision-makerswithaccurateanddetailedinformationaboutthestateandconditionofinfrastructureassets.
1.2 Determine the current and projected use of infrastructure assets and related costs.
· Analyzegrowthscenarios.
· Assessandprojectfutureinfrastructureneeds.
Currentandprojecteduseofinfrastructurethatwillfacilitateplanningforfutureinvestmentandreinvestmentininfrastructure.
1.� Develop a process to evaluate levels of service.
· Identifycurrentservicelevels.
· Linkservicelevelsanddeliverycoststoinfrastructurerequirements.
· ReviewandconfirmservicelevelswithcitizensandCityCouncil.
· Developsystemofimplementingandapplyinglevelsofservice.
Servicelevelsthatproducesustainableinfrastructureandmeetcitizens’needs.
1.� Report infrastructure performance in the meeting of broader social, economic and environmental objectives of the City.
· Determinecriteriaandestablishperformanceindicators.
· Measureperformance.
· Estimatesocial,economicandenvironmentalimplicationsofinfrastructure.
· Benchmarkperformancewithothermunicipalities.
IndicatorsthatmeasureperformanceofinfrastructureassetsinsupportofCity’splansandpriorities.
1.5 Communicate to the public the scope, value and importance of investment in infrastructure.
· Coordinateaunifiedcorporatevoice.
· Developandimplementaninfrastructurecommunicationsplan.
· Providethepublicwithanopportunitytoprovidefeedback.
IncreasedpublicawarenessandsupportoftheCity’sinfrastructureneeds.
Goal 1: Defineneeds:Evaluateandreportthestateofinfrastructureassets
EdmontonCityCouncil’sInfrastructureStrategy 1�
KEY ACTION ITEMS TACTICS AND ACTIVITIES OUTCOMES
2.1 Develop and apply evaluation tools that enhance corporate policies and support infrastructure investment decisions.
· Involvedepartmentsindevelopmentandapplicationofevaluationtools.
· Acquirebuy-infromdepartmentsandseniormanagement.
· Applytoolssuchaslifecyclecosting,riskassessment,returnoninvestment,andbusinesscasemodels.
· Promoteconsistentcorporate-wideuseoftools.
· Conducttrainingsessionsonuseandapplicabilityoftools.
· Providealiaisontosupportdepartmentsintheuseoftools.
· Innovativeevaluationtoolsthatfacilitateinformedinfrastructuremanagementdecision-making.
· Techniquesthatquantifysocial,economicandenvironmentalimpacts.
2.2 Evaluate approaches to sustainable service delivery.
· Identifyandevaluatemethodsofservicedelivery.
· AssessfeasibilityofimplementingbestpracticesintheCityofEdmonton.
· Reportfindingsandmakerecommendations.
· Facilitatedepartmentinformationandresourcesharing.
· Exploremethodstoincreaseinterdepartmentalsynergy.
· Recommendationstoimproveservicedelivery.
· Strongerworkingrelationshipbetweendepartmentsforeffectiveinfrastructuremanagement.
2.� Develop a long-term financial strategy to support investment in existing and new infrastructure – operations and maintenance; renewal, upgrading and expansion.
· Determinelong-terminfrastructureinvestmentandreinvestmentneeds.
· Determinecurrentandpotentialsourcesofrevenue.
· Developasustainablelong-termcorporatefinancialstrategyforinfrastructure.
· Strategythatwillidentifymeasurestoensuresustainablelong-terminvestmentininfrastructure.
2.� Encourage the balanced allocation of limited infrastructure resources.
· Determinerenewal,upgradingandexpansionneeds.
· Determineimplicationsonlevelsofservice.
· Determinecriteriaforbalancedallocationofresources.
· Identifyinvestmentpriorities.
· Guidelinesforabalancedallocationofresources.
2.5 Research infrastructure management and service delivery best practices.
· Participateinprovincial,nationalandinternationalorganizations.
· Developallianceswithothermunicipalities.
· Networkwithresearchinstitutesandothergovernmentagencies.
· EstablishEdmontonasacredibleauthorityoninfrastructureissues.
· Adoptionofbestpracticesandnewtechnologiesforbetterinfrastructuremanagement.
Goal 2: Developsolutions:Implementsustainableinfrastructureassetmanagementpractices
1� EdmontonCityCouncil’sInfrastructureStrategy
KEY ACTION ITEMS TACTICS AND ACTIVITIES OUTCOMES
�.1 Pursue alternative sources of revenue. · Identifyandevaluateappropriatenessofpotentialrevenuegeneratingoptions.
· Evaluateandmonitortheuseofdebt.
· Clarifyrolesandresponsibilities–andassociatedresourcerequirements–withtheotherordersofgovernment.
· Pursuelegislativechangetograntmunicipalitiestheflexibilitytogeneratenewrevenuesources.
· Recommendationsforviablealternativesourcesofrevenue.
· Equitablepositionsamongallordersofgovernmenttosharecostsofinfrastructure.
· Increasedmunicipalcapacitytoinvestininfrastructure.
�.2 Review shared service delivery and cost/revenue-sharing mechanisms within the Capital region.
· DevelopalliancesintheCapitalregiontobenefitfromsharedservicesandbestpractices.
· Establishinter-municipalcommitteetosharebestpracticesamongmunicipalitiesandassessbenefitsofsharedservicesarrangementsintheCapitalregion.
· Implementsharedserviceinitiatives,asappropriate.
· DefinedresponsibilitieswithintheCapitalregionthatcanbesharedandmutuallybeneficial.
�.� Encourage effective coordination with other service providers (power and water, cable, school boards, etc.).
· Networkwithotherinfrastructure/serviceproviders.
· Developmechanismsforacoordinatedapproachwithotherprovidersofinfrastructure.
· Cooperationamongotherinfrastructure/serviceproviderstooptimizeinfrastructureinvestment.
�.� Collaborate on key investments by other orders of government, institutional stakeholders (University of Alberta, Grant MacEwan, NAIT, Capital Health Authority, etc.), the development industry and nongovernmental organizations.
· IdentifykeyinvestmentsintheCity.
· Exploreopportunitiesforcollaboration.
· Collaborationwithexternalstakeholderstooptimizeinfrastructureinvestmentopportunities.
Goal �: Securefunding:Ensureadequatefiscaltoolsandresourcestofundinfrastructureassets
EdmontonCityCouncil’sInfrastructureStrategy 15
Appendix A: Infrastructureassetmanagementdefinitions
Asset:Ausefulorvaluableresourcewiththeintendedpurposeofprovidingabenefitorservice.
Asset management:Anintegratedapproachinvolvingplanning,engineeringandfinancetoeffectivelymanageexistingandnewmunicipalinfrastructuretomaximizebenefits,reduceriskandprovidesatisfactorylevelsofservicetolocalusersandcitizens.
Best practices:State-of-the-artmethodologiesortechnologiesformunicipalinfrastructureplanning,design,construction,management,assessment,maintenanceand
rehabilitationthatconsiderlocaleconomic,environmentalandsocialfactors.
Contributed Assets:Assetsthathavebeenconstructedandfundedbydevelopersorotherpartnersanduponcompletiontransferredtocityownership.
Expansion:Investmentinnewassetsdesignedtoextendthesimilarstandardandtypeofservicetoagreaternumberofusers,e.g.,extendingadrainageorroadnetwork.
Infrastructure:Thephysicalassetsdevelopedandusedbyamunicipalitytosupportits
socialandeconomicactivities.TheCityofEdmonton’sinfrastructureinventoryincludessuchdiverseassetsasdrainage,roadsandright-of-wayinfrastructure,parksandgreenspaces,buildings,fleetvehicles,LRTandtransitfacilities,buildings,trafficcontrolinfrastructure,recreationfacilities,computernetworks,affordablehousingandlibraryresources.
Infrastructure gap:Thedifferencebetweenthecapitalneedsandfinancingcapabilities.
Level of service:Acompositeindicatorthatreflectsthesocialandeconomicgoalsofthecommunityandmayincludeanyofthefollowingparameters:safety,customersatisfaction,quality,quantity,capacity,reliability,responsiveness,environmentalacceptability,costandavailability.
Life cycle costing:Amethodofexpressingcostsinwhichbothcapitalcostsandoperationsandmaintenancecostsareconsideredovertheexpectedservicelifeofanasset.
1� EdmontonCityCouncil’sInfrastructureStrategy
Maintenance:Thesetofactivitiesrequiredtokeepacomponent,system,infrastructureassetorfacilityfunctioningasitwasoriginallydesignedandconstructed.Maintenancereferstoallactionsnecessaryforretaininganassetasnearaspossibletoitoriginalcondition,includingrepairbutexcludingrenewal(rehabilitationorreplacement).
· Repair: Theactionofrestoringacomponent,system,infrastructureasset,orfacilitytoitsformerconditionafterfailureordamage.Repairsdonotextendassetlifeorexpandcapacityanddonotincreaseorimprovefunctionality.
Operations:Thesetofon-goingactivitiesandexpensesthatallowtheuseofanassetforitsintendedfunction.Operationsrefertotheuseofanassetthatconsumesresourcessuchasmanpower,energy,chemicalsandmaterials.
· Operations (Asset): Thesetofon-goingactivitiesthatallowtheuseoftheassetforitsintendedfunction.
· Operations (Service delivery):Thesetofactivitiesandresourcesrequiredtodelivertheserviceorprogramrelatedtotheuseoftheinfrastructureasset.
Renewal:Investmentinexistinginfrastructuretorestoretoitsformerconditionandmayextenditsservicelife,whichmayincludereplacementofindividualcomponentsastheyageorbecomeobsolete.Capitalinvestmentinrenewalextendstheperiodofservicepotentialbutdoesnotchangethereplacementvalue,andsodoesnotincreasethesizeoftheinfrastructureassetportfolio.
· Rehabilitation:Theactionofrestoringacomponent,system,infrastructureasset,orfacilitytoaformerconditionorstatus.
· Replacement:Theactionofreplacingacomponent,system,infrastructureassetorfacility.
Replacement value:Thecostoftotalreplacementofanexistingassetintoday’sdollars.
Upgrade:Investmentinaddedorenhancedcomponentstoexistinginfrastructureassetsdesignedtoimprovethetypeofserviceprovidedtoexistingratepayers.Upgradinggenerallyprolongstheasset’sservicelifeorimprovesitsfunctionality,andmaysometimesbetheresultofbuildingcodechanges,newregulations,adjustedservicelevels,ortechnologyimprovements.
User-pay:Feeschargedspecificallytotheusersofaservicebasedontheuser’sconsumptionoforrelianceontheservice.
Utility:Aservicethatoperatesonaself-supportingandcost-recoverybasis.
References
AccountingforInfrastructureinthePublicSector,CanadianInstituteofCharteredAccountants.Toronto:CanadianInstituteofCharteredAccountants,2002.
Decision-MakingandInvestmentPlanning:PlanningandDefiningMunicipalInfrastructureNeeds.NationalGuidetoSustainableMunicipalInfrastructure(InfraGuide).Ottawa:NationalResearchCouncilandFederationofCanadianMuncipalities,2002.
InternationalInfrastructureManagementManual.Australia/NewZealandEdition.Version2.0.Sydney,Australia:2002.
For more information, contact:
City of Edmonton Office of Infrastructure Phone: (��0) �9�-2�9� Website: www.edmonton.ca/infrastructure
March2006
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