services asset management plan - part 'a' · pdf filebanyule city council sam plan...

1st Cut AMP Draft Version 1.00 June 2014

Prepared by

CT Management Group

for the

Banyule City Council

Incorporated with:

Part ‘B’ – Road Network

Part ‘C’ – Pathways

Part ‘D’ – Bridges

Part ‘E’ – Stormwater Drainage System

Part ‘F’ – Playgrounds

Part ‘G’ – Open Space Assets

Services Asset Management Plan

Part ‘A’ – General Information

Banyule City Council SAM Plan Part ‘A’ – General Information

Banyule SAMP Part 'A' General Version 1- Draft 110614.docx of 27

DOCUMENT CONTROL

CT Management Group

PO Box 1374

GEELONG VIC 3220

Phone: (03) 5221-2566

Email: [email protected]

Web: www.ctman.com.au

Document: Services Asset Management Plan Part ‘A’ – General Information

Banyule City Council

Project Manager: Ian Mann

Author: Jim Henshelwood

Date: June 2014

Synopsis: Services Asset Management Plan for Banyule City Council’s infrastructure assets developed in accordance with the International Infrastructure Management Manual guidelines.

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Version 1.00

SCHEDULE OF ADOPTION

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Disclaimer: This document may be of assistance to you but CT Management Group Pty Ltd do not guarantee that the document is without flaw of any kind and therefore disclaims all liability for any errors, loss or other consequence which may arise from you relying on any information in this publication. It should be

noted that information provided in this document may change at short notice.

mailto:[email protected]

http://www.ctman.com.au/



Table of Contents

1.0 EXECUTIVE SUMMARY ............................................................................................ 5

2.0 INTRODUCTION ...................................................................................................... 6 2.1 PURPOSE OF THE SERVICES ASSET MANAGEMENT PLAN ..................................................................... 6 2.2 ROLE OF LOCAL GOVERNMENT IN ASSET OWNERSHIP ........................................................................ 6 2.3 SAM PLAN FRAMEWORK .............................................................................................................. 7 2.4 LINKAGES TO CORPORATE STRATEGIES ............................................................................................. 8 2.5 CORE & ADVANCED ASSET MANAGEMENT ..................................................................................... 10 2.6 ASSET DATA MANAGEMENT & INFORMATION SYSTEMS ................................................................... 11

3.0 LEVELS OF SERVICE ............................................................................................... 12

4.0 FUTURE DEMAND ................................................................................................. 13

5.0 RISK MANAGEMENT ............................................................................................. 14 5.1 RISK ASSESSMENT ...................................................................................................................... 14 5.2 ASSET INSPECTIONS .................................................................................................................... 15

5.2.1 Inspection Arrangements ................................................................................................................ 15 5.2.2 Response to Customer/Reactive Requests ...................................................................................... 15 5.2.3 Inspection Reporting & Recording ................................................................................................... 16

6.0 STRATEGIC LONG-TERM FINANCIAL NEEDS ........................................................... 17 6.1 FINANCIAL MODELLING ............................................................................................................... 17 6.2 PREDICTED 10-YEAR RENEWAL FUNDING REQUIREMENTS ................................................................ 18 6.3 PREDICTED 10-YEAR MAINTENANCE FUNDING REQUIREMENTS ......................................................... 18

7.0 FINANCIAL MANAGEMENT PRACTICES .................................................................. 19 7.1 FINANCIAL MANAGEMENT REQUIREMENTS .................................................................................... 19

7.1.1 Asset Capitalisation Policy ............................................................................................................... 19 7.1.2 Asset Valuations .............................................................................................................................. 19 7.1.3 Asset Depreciation........................................................................................................................... 20

7.2 NEW CAPITAL WORKS FUNDING ASSESSMENTS .............................................................................. 21 7.3 ASSET EXPENDITURE DEFINITIONS ................................................................................................. 21

8.0 LGPRF SERVICE PERFORMANCE INDICATORS ......................................................... 22

9.0 STANDARDS, MANUALS & GUIDELINES ................................................................. 24

10.0 COUNCIL REFERENCE DOCUMENTS ....................................................................... 24

11.0 ATTACHMENTS ..................................................................................................... 24

12.0 APPENDICES ......................................................................................................... 24 APPENDIX 1 – CUSTOMER REQUEST/INSPECTION PROCESS FLOW CHART ........................................................ 25 APPENDIX 2 – INSPECTION MANAGEMENT FLOW-CHART ............................................................................. 26 APPENDIX 3 – GLOSSARY ......................................................................................................................... 27



List of Figures Figure 1: Structure of a SAM Plan ........................................................................................................................... 7

Figure 2: Asset Management Plan Relationship to the Business Planning Framework .......................................... 9

Figure 3: Asset Management Plan Progression ...................................................................................................... 9

Figure 4: Asset Management Practices ................................................................................................................. 10

Figure 5: Level of Service Concept ........................................................................................................................ 12

Figure 6: LGPRF Development & Implementation Stages ..................................................................................... 22

List of Tables

Table 1: Estimated Resident Population, Banyule LGA (ABS March 2010) ........................................................... 13

Table 2: Asset Expenditure Definitions ................................................................................................................. 21

Table 3: LGPRF Indicator & Measure for Asset Management Plans ..................................................................... 23

Council Services Asset

Management Plan

Part ‘A’

General Information

Part ‘B’

Road

Plan

Part ‘C’

Pathways

Plan

Part ‘D’

Bridges

Plan

Part ‘E’

Drainage

Plan

Part ‘F’

Playgrounds

Plan

Road

Management

PlanComponents of the Services Asset

Management Plan

Part ‘G’

Open Space

Assets Plan



1.0 Executive Summary

Banyule City Council is located between 7 and 21 kilometres north-east of central Melbourne and is made up of 21 suburbs. The City covers an area of approximately 63 square kilometres and is bounded in the south by the Yarra River and in the west by the Darebin Creek. The City is primarily a residential area. While separate houses dominate, increasing numbers of semi-detached houses, townhouses and units are being built. Retaining the neighbourhood character of these residential areas is very important to the local community.

Banyule also has a number of commercial centres, the largest being the Greensborough Principal Activity Centre and the Heidelberg and Ivanhoe Major Activity Centres. There are significant industrial areas in Heidelberg West, Greensborough/ Briar Hill and Bundoora, and a number of large institutions such as the Austin and Repatriation Medical Centre and Simpson Army Barracks.

Banyule City Council is responsible to provide a number of community-focussed services and in doing so must ensure that its infrastructure assets and community facilities are maintained in accordance with well-developed asset management programs and strategic forward plans to enable these services to meet the community needs. Asset management is seen as a practical and financially responsible means of managing Council’s assets by ensuring that the assets continue to provide a specified level of service delivery to defined standards over their entire life.

Banyule City Council’s Services Asset Management Plan provides the framework to deliver optimum operational performance of Council’s infrastructure assets in a cost effective manner. The Plan aims to provide a more formalised and transparent approach to asset management. It provides mechanisms to clearly define its asset refurbishment and asset maintenance practices and to mitigate risk.

The prime guidance used for development of this Services Asset Management Plan (SAM Plan) is the International Infrastructure Management Manual (IIMM) developed jointly by the NZ National Asset Management Steering Group and the Institute of Public Works Engineering of Australia. This manual is highly recognised around the world as one of, if not the leading Infrastructure Management Manual for public works authorities such as municipal councils.

The Plan has been broken into several parts. Part ‘A’ - General Information associated with managing all asset groups Part ‘B’ - Road Network Plan Part ‘C’ - Pathways Plan Part ‘D’ - Bridges Plan Part ‘E’ - Stormwater Drainage Plan Part ‘F’ - Playgrounds Plan Part ‘G’ - Open Space Assets Plan

Each of these Parts will have their own Executive Summary to highlight issues specific to that asset group. Most importantly, the SAM Plan is intended to provide advice to Council on the financial requirements for long-term sustainability of each asset group. This means understanding the impact of any funding ‘gap’ and a plan to manage that gap where it exists.



2.0 Introduction

2.1 Purpose of the Services Asset Management Plan

The Services Asset Management Plan is a means of outlining the key elements involved in managing the asset to those people who need to understand the detail. It combines management, financial, engineering and technical practices to ensure that the level of service required by user groups is provided at the lowest long term cost to the community within the limits of any fiscal constraints that may be imposed by Council.

This Management Plan is a key element of Council’s strategic asset management planning.

The specific purpose of the Asset & Service Management Plan is to: Demonstrate responsible stewardship by the Council; Define and articulate how the infrastructure is and will be managed to achieve the

organisation’s objectives; Provide a basis for customer consultation to determine the appropriate levels of

service; Manage risk of asset failure; Achieve savings by optimising whole of life costs; and Support long term financial planning.

The outcomes of the Asset & Service Management Plan will identify the future funding requirements service delivery accounting for the following factors: Adopted Levels of Service; Future demand for infrastructure; Current asset performance; Asset Failure; Risk; Required works; and Funding constraints.

Council’s performance in providing the funding necessary to meet lifecycle renewal needs through asset depreciation will be measured. In addition, such funding has to meet any backlog of works. The plan will endeavour to separate the ongoing annual lifecycle renewal needs from any backlog.

2.2 Role of Local Government in Asset Ownership

Municipal councils exist principally to supply various core and non-core services that meet the needs of their communities. The type of services provided and how they are provided depends on the level of service required by the community.

Good Governance is enhanced where Councils are able to focus on long-term strategies/policies for asset function as well as day-to-day asset maintenance. The development of this Services Asset Management Plan is considered an important component to enable the long-term planning of its infrastructure.



2.3 SAM Plan Framework

The prime guidance used for development of Council’s Services Asset Management Plan is the framework set out in the Institute of Public Works Engineering Australia’s (IPWEA) International Infrastructure Management Manual (IIMM). The IIMM Framework basically sets out how the Council’s assets are managed from a Strategic, Tactical and Operational point of view. Then structure of each Plan, including Part ‘A’ which is common to all plans, is outlined in the following diagram.

Figure 1: Structure of a SAM Plan

Life Cycle Management Plan

Asset Details & General Information

Section 1

Executive Summary

Outline of content

Key Issues

Section 3

Levels of Service

Background to Levels of Service

Section 2

Introduction

Purpose & Scope of the Plan

Role of Local Government

Plan Format

Section 4

Future Demand

Background to the Impact of

Demand on Assets

Section 5

Risk Management

Risk Assessment

Inspections

Renewals &

Replacements

Renewal strategy & plan

New, Upgrade,

Disposal

Planning criteria

Maintenance

Maintenance Arrangements

Inspection Arrangements

Defect Intervention Levels

Financial Management &

Management Issues

Current financial position

Funding capacity

Funding options & strategy

Management Responsibilities

AM Improvements

Section 7

Financial Management

Practices

Financial Management Requirements

Work Category Definitions

Part ‘B’, ‘C’ etc

Individual Group Asset Management Plans

Part ‘A’

General Information

Demand Management &

Levels of Service

Current Levels of Service

Community Needs & Expectations

Target Community Levels of Service

Section 6

Long Term Financial Needs

Use of Moloney Financial Modelling



2.4 Linkages to Corporate Strategies

Asset Management Plans as component parts of the Services Asset Management Plan will be developed to account for the assets in each category, to monitor the condition of those assets and forecast expenditure requirements for maintenance in the short term and capital replacement in the long term. They are a crucial component of the Council Planning process linking with the following corporate strategies.

Long Term Financial Plan (LTFP) - is the key ten year financial planning document of Council that is governed by a series of financial strategies and accompanying performance indicators that Council considers and adopts. It establishes the financial framework upon which sound financial decisions are made. Input to the development of the LTFP is from the Asset Management Plans as each AM Plan will develop its own 10-year financial needs plan.

Council Plan – is a key strategic document which outlines at a high level what Council intends to achieve over the next four years. The resources required to achieve this plan are detailed in the Strategic Resource Plan.

Strategic Resource Plan - outlines the resources required to achieve the objectives detailed in the Council Plan over the next four years.

Council Budget - sets out in detail the objectives contained in the Strategic Resource Plan, for the forthcoming financial year. This document is a management level document and is “short to medium-term” forward looking. It also provides a basis for management to prepare reports to Council to monitor achievement of performance targets.

Asset Management Policy – the stated intent of this Policy is to provide the guiding principles for current and future management of infrastructure assets, in accordance with the Council Plan and Council’s Long-Term Financial Plan.

Asset Management Strategy – supports the AM Policy and details specific actions to be undertaken by Council to improve asset management capability and achieve specific strategic objectives.

Annual Report – is intended to inform the community, including residents, ratepayers, and businesses, visitors, government agencies and interested groups. It shows Council’s highlights and achievements, along with its issues and challenges of the past year. It aims to inform the community of Council’s performance against the commitments set out in the Council Plan.

Management Practices - are the administration and management activities required to fulfil Council’s philosophy in regards to “whole of life” asset management as contained within the Asset Management Policy.

Contracts – the service levels, strategies and information requirements contained in the Asset Management Plans are translated into contract specifications and reporting requirements.

Underpinning these strategic documents are numerous processes, methodologies and practices which are undertaken within the day to day activities of the City’s administration and management duties. The Asset Management Plan details those activities that relate to managing the network of assets within an asset group.



The following chart outlines the linkages between the various components involved in Council’s strategic planning process and progression of development of the Services Asset Management Plan.

The Asset Management Strategy provides guidance to Council’s Financial Strategy and to the City Plan. The Services Asset Management Plan in turn provides input to the Road Management Plan, Financial Management Plan and the Annual Business Plan & Budget. From this the Annual Works Programs for infrastructure maintenance and renewals are developed.

Figure 2: Asset Management Plan Relationship to the Business Planning Framework

Corporate Strategic Direction

City Plan

Council Plan

Council’s Asset Management Policy

Council’s Asset Management Strategy

Various Corporate Strategies & Policies

Financial Strategy

Annual Business Plan & Budget

Legislative

Requirements

Community

Expectations

Service Level

Reviews

Implementing the

Asset & Service

Management Plan

The Asset Management Team

Asset & Service

Management Plan

Review and Audit

Asset & Service

Management

Improvement

Planning

Services Asset

Management Plan

Figure 3: Asset Management Plan Progression

Asset Management

PolicyApproved by Council:

November 2003Asset Management

StrategyApproved by Council:

November 2003

Road Management PlanApproved by Council:

December 2004

Services Asset

Management Plan

Currently in progress

Road Network

Pathways

Bridges

Stormwater Drainage

Buildings & Facilities

Open Space assets

Playgrounds



2.5 Core & Advanced Asset Management

This Services Asset Management Plan has been prepared as a ‘core’ Asset & Service Management Plan in accordance with the International Infrastructure Management Manual. Its preparation meets minimum legislative and organisational requirements for sustainable service delivery and long term financial planning and reporting. Core asset management is a ‘top down’ approach where analysis is applied at the ‘system’ or ‘network’ level.

Core asset management: takes a lifecycle approach utilises best available current information and random condition and/or performance

sampling utilises simple risk assessment to identify critical assets utilises existing levels of service prioritises capital works using simple ranking criteria presents a provisional long-term (10-20 year) Cash-flow predictions based on current

knowledge provides financial and critical service performance measures against which trends and

AM Plan implementation and improvement can be monitored

Future revisions of this Services Asset Management Plan will move towards ‘advanced’ asset management using a ‘bottom up’ approach for gathering asset information for individual assets to support the optimisation of activities and programs to meet agreed service levels.

Advanced Asset Management (AAM) employs predictive modelling, risk management and optimised decision-making techniques to establish life-cycle treatment options and related long term cash flow predictions.

The following is a figure of asset management practices.

Figure 4: Asset Management Practices

Corporate Data Information Systems

Corporate Financial System

Geographic Information System

Asset Information System

Stores Inventory System

Corporate Public Request System

Asse

t D

ata

Asset

Management

Plan

Implementation

Strategies to facilitate

service delivery

Data analysis and

evaluation processes



2.6 Asset Data Management & Information Systems

The data information systems used for the management of assets involves a combination of processes, data and software. These are applied to provide the essential information outputs for effective asset management of risk and optimum infrastructure maintenance and refurbishments.

The systems in use are described in detail in the Asset Management Strategy document.

There are three Customer Request Management Systems in use which include Merit CRM (for historic purposes), NOMAD & eServices CRM.

Merit CRM System (for historic purposes) captures request types for Infrastructure Maintenance, Graffiti, Older Adult Bookings, Community Safety, Pre-booked collections for Waste Management, Engineering Developments / Drainage & Traffic Engineering.

NOMAD Parks & Buildings Request System manages requests for Buildings, Parks Maintenance, Bushland Management, Horticultural Services, and Tree Care & Administration.

e-Services browser based CRM module manages request for Waste Management (excluding pre-booked collections), Local Laws, Cleansing, Health, Revenue and Risk.

The Corporate Accounting System utilised at Council is Civica’s Authority Financials. Some of the financial modules include General Ledger, Accounts Receivable, Accounts Payable, Bank Reconciliation, and Requisitioning & Purchasing.

Council’s Geographic Information System is Exponare (MapInfo).

Council uses the SMEC Pavement Management System which captures the road network, including road surface & pavement, pathway and kerb & channel details. The system also assists with modelling which the new e-Services AIM (Asset & Infrastructure Management) system does not do. For more information on AIM refer to 5.2.1.

The table below summarises the current data systems as described above:

Module System

CRM Merit CRM (for historic purposes), NOMAD & e-Services CRM

Financials Corporate Authority System, Purple Octopus & Powerbudget

GIS Exponare

Pavement Management SMEC

Council has implemented the Civica Asset & Infrastructure Management System, AIM, as its Corporate Asset Information System.

AIM provides full lifecycle analysis of assets within an enterprise wide asset management solution and delivers cohesive processing and reporting requirements to fully meet Council workflows. The system is designed to improve the management of Council’s Infrastructure by applying best practice principles to support the delivery of services to its community and customers. The AIM system is a separate application which utilises modules within Authority & uses e-Services as a medium to deliver a single consistent environment.



3.0 Levels of Service

The International Infrastructure Management Manual describes Levels of Service (LOS) as ‘defined service quality for an activity or service area against which service performance may be measured’.

What do we mean by “Levels of Service”?

VISION

INFRASTRUCTURE

SERVICE

What are the community outcomes that Council wants to achieve?

What infrastructure assets are required to support the service?

What services (including their performance levels) are required to meet this vision?

Figure 5: Level of Service Concept

Level of Service (LOS) is the defined quality of service of an asset. Understanding the required level of service is vital for lifecycle management, as this largely determines an asset’s development, operation, maintenance, replacement and ultimate disposal.

Levels of service are pivotal in asset management as they have a direct financial impact due to their importance in both operational and risk-based prioritisation.

An objective of asset management planning is to match the level of service provided by an asset with the expectations of its customers. Asset management Planning will enable a relationship between level of service and cost of service to be determined. This relationship can then be evaluated in consultation with customers to determine the optimum level of service customers are willing to pay for.

Levels of service can be broken down into three basic aspects: Function – its purpose for the community Design Parameters – what is required of and from the asset itself Performance & Presentation - the effectiveness of delivery of the service

Levels of Service are determined from the public consultation process and customer satisfaction surveys. They reflect the strategic objectives of Council and are based on: Customer expectations for quality of service and willingness to pay Legislative requirements; environmental standards, regulations and legislation that

impacts the way assets are managed Council’s mission and objectives as stated in the strategic plan Available resources, particularly financial constraints Organisational delivery mechanisms Design Standards and Codes of Practice



Defined levels of service can then be used to:

Inform customers of the proposed level of service to be offered

Develop AM strategies to deliver the required level of service

Measure performance against those defined levels of service

Identify the costs and benefits of the services offered

Enable customers to assess suitability, affordability and equity of the services offered. Tables in each asset group part of this Services Asset Management Plan will outline what it is assumed to be community expectations in terms of that asset group (eg road & footpath network, buildings & facilities, stormwater drainage system, open space assets, etc) in terms of maintenance and presentation and general levels of service. Levels of service to date have been developed on the basis of available funding through the annual budget process.

4.0 Future Demand

The following statistical data on growth within the City of Banyule has been sourced from the Australian Bureau of Statistics.

Table 1: Estimated Resident Population, Banyule LGA (ABS March 2010)

Local Government Area

ERP at 30 June

2001 2002 2003 2004 2005 2006 2007r 2008r 2009p

no. no. no. no. no. no. no. no. no.

Banyule (C) 118696 118540 118485 117824 118362 119163 120576 121710 123521

Annual change: -156 -55 -661 538 801 1413 1134 1811

-0.13% -0.05% -0.56% 0.46% 0.68% 1.19% 0.94% 1.49%

8 Year change: 4.07%

Average over 8 years: 0.51%

Population growth over the past 8 years 2001-2009 has been averaging around 0.5% so is minimal and in itself is not causing a significant pressure for increasing service demands.

Impacts that can cause changes to the existing management environment such as the magnitude of the asset base, levels of service and required funding include changes in growth patterns and also demographics. Other changes include environmental pressures, climatic change and a general desire for the community for changes to services and also service levels.

Council has to be able to sustain the level of maintenance & renewals of its infrastructure assets over the long term if it is to provide the community with the services provided by those assets that it wants. The community has to recognise that to do so may well require additional funding.

The component individual group asset management plans will outline the specific demand issues relating to that group.



5.0 Risk Management

5.1 Risk Assessment

Council’s risk assessment process is outlined in its Risk Management Policy & Guidelines 2004 document and in the 2006 edition of Council’s Asset Management Strategy.

The only practicable means of readily identifying risk is by undertaking regular inspections. This process should enable significant risks to be discovered and remedied in advance of possible injury.

Risks are to be analysed in terms of consequence and likelihood in the context of those controls. The analysis should consider the range of potential consequences and how likely those consequences are to occur. Consequence and likelihood may be combined to produce an estimated level of risk.

The risk assessment of a specific asset component is determined by the specific defect or hazard likely to occur and the function, location, types of users and user numbers.

For instance, for footpaths, the risk assessment is determined by size of tripping hazards, slipperiness, unevenness and the location of the defect in terms of its asset hierarchy classification. Hierarchy itself is determined by function, types of users and user numbers. For roads, the risk assessment is determined by the size of various modes of failure and hierarchy classification of the location.

In the case of Council buildings, the following are typical of the potential risks that need to be assessed and rated:

Tripping or slipping incident where someone is injured.

Injury resulting from contact with defect associated with the building (eg protruding nail, hole in floor, etc)

Property damage due to vandalism or fire

Faulty electrical system results in building user becoming electrocuted.

Emergency lighting fails during an emergency

Building users trapped in building - fatalities.

Fire detection or suppression system fails during a fire, users trapped.



5.2 Asset Inspections

5.2.1 Inspection Arrangements

Each asset group will have its own specific inspection requirements and these will be outlined in their plan. This covers actual requirements and frequencies of inspection types. In general, a four-tier inspection regime has been implemented covering safety, incidents, defects and condition.

These requirements can be summarised as follows:

Reactive Inspections - Response to customer enquiries or notifications. Inspections of all reported defects are undertaken following notification by members of the community or Council employees. The subsequent inspection will be conducted by an appropriate Council representative.

Programmed Inspections – determine if the asset complies with the specified levels of service. In the case of roads, they are to be undertaken by under a formal timetable regime.

Safety issues may be detected either as the result of the programmed defect inspection or by observation followed by notification to council by members of the community or council employees while undertaking their normal work duties. A subsequent reactive safety inspection will then be conducted by an appropriate council officer.

Incident Inspections – enables an incident condition report to be prepared for use in legal proceedings and the gathering of information for the analysis of the causes of accidents and the planning and implementation of asset management and safety measures;

Condition Inspections - identify deficiencies in the structural integrity of the infrastructure assets, which if untreated, are likely to adversely affect their values. The deficiencies may well impact short-term serviceability as well as the ability of the component to continue to perform for the duration of its intended life span. They are also under a formal timetable regime however at a lesser frequency than the abovementioned programmed inspections.

5.2.2 Response to Customer/Reactive Requests

Currently Council’s Customer Request System records dates that requests have been received, details pertaining to the request and dates applicable when those requests have been actioned and/or completed.

It should be noted that ‘actioning’ a request doesn’t necessarily mean that the request has been fulfilled but simply that appropriate action has taken place.

Appropriate action may well mean that an asset defect has been inspected and: repairs are straight-forward and a work order has been created - the appropriate

action in this case is when the repair work has been completed; or repairs are significant and need to be programmed, the site has been made safe until

such time as repairs are undertaken - the appropriate action is when the repair work has been listed on the future works program not when it has been completed; or

the defect was found not to warrant any remedial action at that stage as it was below specified intervention levels - the appropriate action in this case is when the decision is made that no action is required.

Whatever the response, it is noted against the original request.



The Customer Request System enables the response times to be monitored to assess performance. This covers response times both for inspections and then the interval until appropriate action is undertaken.

The target inspection response times, as outlined in the table below, are:

Request for Service Inspection Target Response Times

Safety Issues 24 hours

Specific Incident Inspections 7 working days

All Other Requests 10 working days

In terms of maintenance activity, the target defect rectification response times are set out in the Defect Intervention Level Schedules in each of the Group Asset Management Plans covering intervention levels and response times.

5.2.3 Inspection Reporting & Recording

Inspections will occur either as the result of the programmed scheduling or as a direct result of individual issues, notified both externally & internally, that are received & processed through the Customer Request System.

To facilitate the inspection process, recording and data transfer mechanisms are utilised to ensure that the Asset Information System is populated with data that reflects as far as practicable the true situation of condition of the asset arising from inspections.

Appendix 1 is a flowchart of Council’s infrastructure asset inspection and data management process.



6.0 Strategic Long-Term Financial Needs

6.1 Financial Modelling

Financial modelling enables predictions for future funding requirements to be made based on available data and recent trends in asset life expectancies, condition, replacement costs, etc. Modelling outcome is very much dependent upon the accuracy of the input data and how assets are grouped for modelling. It is not a precise process but does provide a degree of certainty in the outcomes.

Banyule City Council, along with a number of other councils in Victoria, under the guidance of the MAV STEP Program has utilised the Moloney Financial Modelling system to establish the order of magnitude of renewal needs of its infrastructure assets.

The Moloney Modelling process compares the current renewal expenditure, the asset valuation and quantity, the existing condition of assets and the level at which the asset will be renewed (intervention level) in order to determine the required expenditure to meet the renewal targets. Both existing condition and intervention levels are based on a Moloney 0-10 rating.

In the Moloney Renewal Model, the intervention point is known as the Retreatment Intervention Condition Level (RICL). The RICL is the point at which the asset component has deteriorated to such a condition that it is economically prudent to initiate restoration works to bring the condition of that component back to new (condition zero (0)).

When performing the evaluation, the Council asset valuation was used in the model. The asset quantities were retrieved from both the Asset database and the Road and Pavements database. The existing asset condition was retrieved from condition audits undertaken annually for buildings and every four years for roads and footpaths. The renewal expenditure was based on the capital budget and works program as well as historical expenditure in maintenance budgets. Intervention levels were set in consultation with service managers and also by reviewing metro council averages.

The financial modelling function within the Moloney system has two modelling paths”

The “required capital expenditure model” (RCEM) where the condition outcome is nominated and the model predicts capital expenditure.

The “Proposed Expenditure Model” (PEM) where the proposed expenditure is nominated and the model predicts future condition.

Each asset group plan within the Services Asset Management Plan has its strategic long-term financial needs assessed through the Moloney Model to enable a consistent outcome of needs to be presented to Council.

The Table in Section 6.2 summarises the 10-year predicted asset renewal financial requirements for all major asset groups covered by this plan as determined by utilisation of the Moloney Financial Modelling System. These renewal needs are to be summarised and recorded in Council’s Long Term Financial Plan.

These figures are indicative and are currently under review in the Asset Category Plans. These Tables will be updated on the sign-off of the individual asset plans.



6.2 Predicted 10-Year Renewal Funding Requirements

Asset Component 2013/14 Budget Funding

Predicted 10-Year Capital Renewal Funding Requirements (Modelled)

1 2 3 4 5 6 7 8 9 10

14/15 15/16 16/17 17/18 18/19 19/20 20/21 21/22 22/23 23/24

Part ‘B’ – Roads, K&C and Car Parks



Part ‘E’ - Stormwater Drainage

Part ‘F’ - Playgrounds


TOTAL FOR ASSET RENEWALS

6.3 Predicted 10-Year Maintenance Funding Requirements

Asset Component 2013/14 Budget Funding

Predicted 10-Year Capital Renewal Funding Requirements (Modelled)

1 2 3 4 5 6 7 8 9 10

14/15 15/16 16/17 17/18 18/19 19/20 20/21 21/22 22/23 23/24

Part ‘B’ – Roads, K&C and Car Parks



Part ‘E’ - Stormwater Drainage

Part ‘F’ - Playgrounds


TOTAL FOR ASSET RENEWALS



7.0 Financial Management Practices

7.1 Financial Management Requirements

7.1.1 Asset Capitalisation Policy

Capitalisation refers to the level at which assets are recognised in the Council’s financial statements. The values of assets to be included in the financial statements are summarised below. Thresholds will be reviewed in the finalisation of Asset Category Plans.

The threshold limit for roads, streets and bridges has been split into three categories as shown below: Asset Category Threshold Limit

Roads - surface and pavement All

Roads - footpath and kerb and channel All

Roads - bridges, medians and local area traffic management $10,000

Drainage $5,000

Parks and gardens $1,000

Playgrounds $1,000

Land All

Buildings $5,000

Motor vehicles All

Plant and equipment $1,000

Furniture and fittings $5,000

Waste management (Big bins) $10,000

Works of art All

7.1.2 Asset Valuations

Infrastructure and property are revalued at the 30 June in the year of each general biennial revaluation of property within the municipality and are assessed each year to ensure their values don’t materially vary from their current values.

Any revaluation increase is credited to an asset revaluation reserve except that, where the increase reverses a decrease previously recognised as an expense, it is recognised as revenue for the financial year. Any revaluation decrease is recognised as an expense except that, where the decrease reverses a revaluation increase previously credited to, and still included in the balance of the asset revaluation reserve, it is debited to the revaluation reserve.

Asset Valuations:

Land and buildings - determined by Council’s Valuer in accordance with the Valuation of Land Act 1960. It is calculated using market value, as a fair value, based on existing use.

Drainage, roads, streets and bridges assets - the valuation represents an estimate of written down current replacement costs determined by reference to engineering construction plans and Melbourne Water base maps after taking into account



construction costs written down for the current condition of the assets and the impact of any economic or technical obsolescence.

The following asset groups are valued at cost:

Parks and gardens assets,

motor vehicles,

plant and equipment,

furniture and fittings,

art collection assets, and

waste management big bins

7.1.3 Asset Depreciation

All non-current assets having a limited useful life are systematically depreciated over a period of time in a manner which reflects the useful life of the asset to Council. Land is not a depreciable asset. Council’s art collection assets are not considered depreciable.

Depreciation of all assets is provided using the straight-line basis with rates that are reviewed each reporting period. The depreciation rates have not changed from the previous year.

Useful Lives will be reviewed in the finalisation of Asset Category Plans.

Asset Category Depreciation Useful Life Rate % Years

Roads, streets and bridges

Roads – seals 2.50 40 Roads – sub-structure 0.66 150 Bridges 0.66 150 Footpaths 1.33 75 Kerb, channel and medians 1.18–1.42 85–70

Drainage 1 100

Parks and gardens 4–20 25–5

Playgrounds 4 25

Buildings 1 100

Motor vehicles 15 6.60

Plant and equipment 4–33.3 25–3

Furniture and fittings 5–10 20–10

Waste management big bins 10 10



7.2 New Capital Works Funding Assessments

The LTFP has adopted a strategy that any new capital works (capital extension) proposals must include a lifecycle cost evaluation exercise that identifies and costs the asset construction, maintenance, operating and depreciation costs ie. Whole of lifecycle costs.

Tables in the Asset Management Strategy, Section 5.6, establish the overall cost of each capital works item, including consequential maintenance and operations costs that will be incurred when the project is completed.

7.3 Asset Expenditure Definitions

The following Table defines the type of asset expenditure as outlined in Council’s Long Term Financial Plan

Table 2: Asset Expenditure Definitions

Type of Expenditure Definition Purpose/Example

Maintenance

Expenditure on an asset that maintains the asset in use, but does not increase its service potential or life.

Life extension: Extending asset lives by repair, reducing average annual consumption costs and renewal rates, eg. Repairing a single pipe in a drainage network or a pothole in a road.

Capital Renewal

Expenditure on an existing asset or a portion of an infrastructure network which returns the service potential, or extends the life of the asset, to its original potential.

Retains an existing service level, eg. Road reseals, resurfacing a footpath.

Capital Upgrade

Expenditure on upgrading the standard of an existing asset to provide a higher level of service, or to extend the life of the asset beyond its original standard.

Increases the quality of service provided to ratepayers or provides new services, eg. Widening the pavement of a sealed area of an existing road.

New/Expansion Capital

Expenditure on extending an infrastructure network at the same standard enjoyed by existing residents to a new group of users.

New or additional services to developing areas of the municipality or under serviced areas eg. Building a sporting facility.



8.0 LGPRF Service Performance Indicators

The Victorian Government is working with councils to develop a performance reporting framework to ensure that all councils are measuring and reporting on their performance in a consistent way. Local Government Victoria (LGV) will deliver the Local Government Performance Reporting Framework (LGPRF) in close collaboration with the local government sector. The LGPRF will become mandatory for implementation by councils as part of the planning and reporting cycle in FY 2014-15.

The development and implementation of the LGPRF is being carried out in five stages:

Figure 6: LGPRF Development & Implementation Stages

Stages one to three are now complete with Council's to begin collecting data for the mandatory reporting period commencing 1 July 2014.

The primary objective of the LGPRF is to provide comprehensive performance information that meets the needs of stakeholders. This is an objective that seeks to balance the needs and expectations of a number of audiences. In meeting this objective:

councils will have information to support strategic decision-making and continuous improvement;

communities will have information about council performance and productivity;

regulators will have information to monitor compliance with relevant reporting requirements; and

State and Commonwealth Governments will be better informed to make decisions that ensure an effective, efficient and sustainable system of local government.

To provide a comprehensive picture of council performance, four indicator sets: service performance, financial performance, sustainable capacity and governance & management have been developed across three thematic areas: service performance, financial performance and sustainability. An objective for assessing performance against each thematic area has been established to inform the development of performance indicators.

From an Asset Management perspective, the indicator to be achieved relates to the development of Asset Management Plans.



Table 3: LGPRF Indicator & Measure for Asset Management Plans

Dimension Service Outcome

Indicator Community engagement

Rationale Indicator of the broad objective that community engagement is important for good decision-making. Having appropriate engagement policies and procedures suggests an improvement in decision-making

Measure Asset management plans

Definition Plans that set out the asset maintenance and renewal needs for key infrastructure asset classes for at least the next 10 years

Computation

Assessment

Plans,

No Plans, or

Other

Where Council has plans it must also provide details of the date of operation of the current plans.

Where Council has no plans it must provide a reason.

Data Source Council Records



9.0 Standards, Manuals & Guidelines

Key standards, manuals & guidelines include:

International Infrastructure Management Manual (IIMM), IPWEA.

Australian Accounting Standards AAS27 and AASB116

Risk Management Standards AS/NZS 4360:2004 & update AS/NZS ISO 31000:2009

Local Government Asset Investment Guidelines’ – DVC, August 2006.

International Infrastructure Management Manual (2006) - IPWEA

Australian Infrastructure Financial Management Guidelines (2009) - IPWEA

Developing Levels of Service Performance Measures (Creating Customer Value from Community Assets) – Version 2.0, NAMS (NZ) 2007

Sustaining Local Assets – Policy Statement 2003, DVC

Accounting for Infrastructure Assets – Guidelines 2003, DVC

10.0 Council Reference Documents

Key Council reference documents include:

Banyule Asset Management Policy

Banyule Asset Management Strategy

Banyule Long Term Financial Plan 2010/11-2020/21

Banyule Council Plan

Banyule Strategic Resource Plan

Banyule Moloney Renewal Gap Financial Modelling files

11.0 Attachments

Part ‘B’ - Road & Street Plan Part ‘C’ – Pathways Plan Part ‘D’ – Bridges Plan Part ‘E’ - Stormwater Drainage Plan Part ‘F’ – Playgrounds Plan Part ‘G’ – Open Space Assets Plan

12.0 Appendices

Appendix 1: - Customer Request/Inspection Flow Chart Appendix 2: - Inspection Management Flow Chart Appendix 3: - Glossary



Appendix 1 – Customer Request/Inspection Process Flow Chart

Non-Hazardous

Temporary Repair prioritise and program work

Customer Request

In person or by phoneBy fax, letter and e-mail

Banyule's website

Infovision DocManager

Register document details

MERIT CRM9

Registration of request

Refer to service or

responsible authority

Infrastructure

Maintenance

Inspect

Schedule

Infrastructure

Maintenance

Inspect

Specific Incident

Report (SIR)

Site Photos

Service Authority Request

System (SARS) registration

Hazardous

Immediate repair

Non-Hazardous

Make safe, prioritise and

program work

No Action

Can not locate reported

defect or no work required

Update MERIT CRM9 Database

Finalise request including completion

date

Respond to Customer

if required

Infrastructure Work Diary

Details, completion date and costs

Risk Management

Documentation filed by Risk

Management in case of

Public Liability Claim

Service authority

authorisation for

reinstatement

Yes

No

Council

responsibility?

Personal injury

has occured?

Yes

Yes

No

No



Appendix 2 – Inspection Management Flow-Chart

Customer /

Officer Request

Life Cycle/Strategic

Condition Inspection

Programmed Risk / Defect Inspection

Customer

Request

System

Request

recorded

INS

PE

CT

ION

S

Record all

InspectionsIs a Priority Response

Action Required?

MAKE SAFE

(Signs, Barriers, etc)

Can remedial

work be undertaken

immediately?

Carry out remedial

works

Inspection Record Defect below intervention level

Maintenance intervention

Priority intervention

Capital work (renewal, etc)

Customer to be notified of action/no

action if required

Maintenance Defect

Works (Prioritised)

Implement

Maintenance

Program

Implement

Capital Works

Program

Capital Works

Program (Prioritised)

Completed workRecorded against asset

in Asset Register

Co

mp

le

te

d w

ork

re

co

rd

ed

ag

ain

st In

sp

ec

tio

n re

co

rd

Yes

Yes

No

No

Where required,

Customer advised of

action/no action to be

taken

Customer Request/Inspection

Recording ProcessMaintenance Management Process



Appendix 3 – Glossary

Asset - Is an item owned and/or managed by Council.

AAS27 - Asset Accounting Standard - Is financial accounting as it relates to assets.

Hierarchy - A framework for segmenting an asset base into appropriate classifications.

Asset Management - The combination of financial, economic, engineering management and other practices provided to maintain an asset at the required level of service.

Benchmarking - Measuring performance or practices against recognised industry standards.

Capital Evaluation Process - A process in Council’s New Works and Services (Capital Works) Program where projects are evaluated according to certain criteria and prioritised for implementation.

Capital Expenditure – Creation of new assets or to increase the capacity of existing assets.

Components – Individual parts of an asset.

Continuous Improvement - A program of review of service delivery, procedures, practices and plans to assess and implement improvement opportunities.

Replacement - The cost of replacing the service potential of an existing asset, by reference to some measure of capacity, with an appropriate modern equivalent asset.

GIS Geographic Information System - GIS is a computer based mapping system used to manipulate, analyse and present information that is tied to a ground location.

Intervention Level - that stage of deterioration of the asset component at which it is no longer ‘tolerable’. It is impracticable for any defect to be remedied at the time it first appears, so a level of tolerance is required.

Level of Service - Service level is standard to which an asset is maintained and relates to the quality, quantity, reliability, responsiveness, environmental acceptability and costs of related activities.

Maintenance -Activities necessary to retain an asset as near as practical to its original condition for it to reach its expected life.

Periodic - sustains the design life of an asset.

Routine/Programmed – condition monitoring activities used to predict failure.

Preventive –reactive maintenance through notification of defects.

Pavement Management System (PMS) - An asset management (AM) system designed to model road condition data and provide the outputs for managing annual and long term maintenance activities.

Performance - A measure of a service or activity used to compare actual performance against a standard.

Rehabilitation - Works to rebuild or replace parts or components of an asset, to restore it to a required functional condition and extend its life, (ie heavy patching of roads) without significant upgrading or renewal.

Renewal - Works to refurbish or replace existing facilities of equivalent capacity or performance quality.

Repair - Action to restore an item to its previous condition after failure or damage.

Replacement - Replacement of an asset that has reached the end of its life to an agreed level of service.

Risk Assessment - The process used to determine the level of risk against predetermined standards.

Risk Management - A management technique used to identify and analyse potential risks and responses.

Road Register - A detailed listing of roads for which Council (the Responsible Authority) is responsible for maintaining.

Strategy - A plan containing the long-term goals and strategies of an organization or function.