Community Wastewater Management System (CWMS) Infrastructure and Asset Management Plan

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1 Community Wastewater Management System (CWMS) Infrastructure and Asset Management Plan

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3 Contents Naturally Better Abbreviations...i Glossary...ii Executive summary... 1 What Council provides... 1 What does it cost?... 1 Plans for the future... 1 Measuring our performance... 1 The next steps... 2 Introduction... 3 Background... 3 Goals and objectives of asset management.. 4 Plan framework... 7 Core and advanced asset management... 9 Levels of service Customer research and expectations Legislative requirements Current levels of service Desired levels of service Future demand Demand forecast Changes in technology Demand management plan New assets from growth Lifecycle management plan Background data Physical parameters Asset capacity and performance Asset condition Asset valuations Risk management plan Routine maintenance plan Maintenance plan Standards and specifications Summary of future maintenance expenditures Renewal/replacement plan Renewal plan Renewal standards Summary of future renewal expenditure Creation/acquisition upgrade plan Selection criteria Standards and specifications Summary of future upgrade/new assets expenditure Disposal plan Financial summary Financial statements and projections Sustainability of service delivery Funding strategy Valuation forecasts Key assumptions made in financial forecasts Asset management practices Accounting/financial systems Asset management systems Information flow requirements and processes Standards and guidelines Plan improvement and monitoring Performance measures Improvement plan Condition data Clay pipes Fibro-cement pipes Monitoring and review procedures References Appendices A Maintenance response levels of service B Projected 20-year capital renewal works program C Planned upgrade/exp/new 20-year capital works program i

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5 Abbreviations Naturally Better AAAC ARI BOD CRC CWMS DA DoH EF IAMP IRMP MMS PCI RV SS VPH Average annual asset consumption Average recurrence interval Biochemical (biological) oxygen demand Current replacement cost Community wastewater management system Depreciable amount Department of Health Earthworks/formation Infrastructure and Asset Management Plan Infrastructure Risk Management Plan Maintenance management system Pavement condition index Residual value Suspended solids Vehicles per hour i

6 Glossary Annual service cost (ASC) An estimate of the cost that would be tendered, per annum, if tenders were called for the supply of a service to a performance specification for a fixed term. The Annual Service Cost includes operating, maintenance, depreciation, finance/ opportunity and disposal costs, less revenue. Asset class Grouping of assets of a similar nature and use in an entity s operations (AASB ). Asset condition assessment The process of continuous or periodic inspection, assessment, measurement and interpretation of the resultant data to indicate the condition of a specific asset so as to determine the need for some preventative or remedial action. Asset management The combination of management, financial, economic, engineering and other practices applied to physical assets with the objective of providing the required level of service in the most cost effective manner. Assets Future economic benefits controlled by the entity as a result of past transactions or other past events (AAS27.12). Property, plant and equipment including infrastructure and other assets (such as furniture and fittings) with benefits expected to last more than 12 month. Average annual asset consumption (AAAC)* The amount of a local government s asset base consumed during a year. This may be calculated by dividing the Depreciable Amount (DA) by the Useful Life and totalled for each and every asset OR by dividing the Fair Value (Depreciated Replacement Cost) by the Remaining Life and totalled for each and every asset in an asset category or class. Brownfield asset values** Asset (re)valuation values based on the cost to replace the asset including demolition and restoration costs. Capital expansion expenditure Expenditure that extends an existing asset, at the same standard as is currently enjoyed by residents, to a new group of users. It is discretional expenditure, which increases future operating, and maintenance costs, because it increases Council s asset base, but may be associated with additional revenue from the new user group, eg. extending a drainage or road network, the provision of an oval or park in a new suburb for new residents. Capital expenditure Relatively large (material) expenditure, which has benefits, expected to last for more than 12 months. Capital expenditure includes renewal, expansion and upgrade. Where capital projects involve a combination of renewal, expansion and/or upgrade expenditures, the total project cost needs to be allocated accordingly. ii

7 Naturally Better Capital funding Funding to pay for capital expenditure. Capital grants Monies received generally tied to the specific projects for which they are granted, which are often upgrade and/or expansion or new investment proposals. Capital investment expenditure See capital expenditure definition. Capital new expenditure Expenditure which creates a new asset providing a new service to the community that did not exist beforehand. As it increases service potential it may impact revenue and will increase future operating and maintenance expenditure. Capital renewal expenditure Expenditure on an existing asset, which returns the service potential or the life of the asset up to that which it had originally. It is periodically required expenditure, relatively large (material) in value compared with the value of the components or sub-components of the asset being renewed. As it reinstates existing service potential, it has no impact on revenue, but may reduce future operating and maintenance expenditure if completed at the optimum time, eg. resurfacing or resheeting a material part of a road network, replacing a material section of a drainage network with pipes of the same capacity, resurfacing an oval. Where capital projects involve a combination of renewal, expansion and/or upgrade expenditures, the total project cost needs to be allocated accordingly. Capital upgrade expenditure Expenditure, which enhances an existing asset to provide a higher level of service or expenditure that will increase the life of the asset beyond that which it had originally. Upgrade expenditure is discretional and often does not result in additional revenue unless direct user charges apply. It will increase operating and maintenance expenditure in the future because of the increase in the Council s asset base, eg. widening the sealed area of an existing road, replacing drainage pipes with pipes of a greater capacity, enlarging a grandstand at a sporting facility. Where capital projects involve a combination of renewal, expansion and/or upgrade expenditures, the total project cost needs to be allocated accordingly. Carrying amount The amount at which an asset is recognised after deducting any accumulated depreciation / amortisation and accumulated impairment losses thereon. Class of assets See asset class definition Component An individual part of an asset which contributes to the composition of the whole and can be separated from or attached to an asset or a system. Cost of an asset The amount of cash or cash equivalents paid or the fair value of the consideration given to iii

8 acquire an asset at the time of its acquisition or construction, plus any costs necessary to place the asset into service. This includes one-off design and project management costs. Current replacement cost (CRC) The cost the entity would incur to acquire the asset on the reporting date. The cost is measured by reference to the lowest cost at which the gross future economic benefits could be obtained in the normal course of business or the minimum it would cost, to replace the existing asset with a technologically modern equivalent new asset (not a second hand one) with the same economic benefits (gross service potential) allowing for any differences in the quantity and quality of output and in operating costs. Current replacement cost As New (CRC) The current cost of replacing the original service potential of an existing asset, with a similar modern equivalent asset, i.e. the total cost of replacing an existing asset with an as NEW or similar asset expressed in current dollar values. Cyclic Maintenance** Replacement of higher value components/ sub-components of assets that is undertaken on a regular cycle including repainting, building roof replacement, cycle, replacement of air conditioning equipment, etc. This work generally falls below the capital/ maintenance threshold and needs to be identified in a specific maintenance budget allocation. Depreciable amount The cost of an asset, or other amount substituted for its cost, less its residual value (AASB 116.6) Depreciated replacement cost (DRC) The current replacement cost (CRC) of an asset less, where applicable, accumulated depreciation calculated on the basis of such cost to reflect the already consumed or expired future economic benefits of the asset Depreciation/amortisation The systematic allocation of the depreciable amount (service potential) of an asset over its useful life. Economic life See useful life definition. Expenditure The spending of money on goods and services. Expenditure includes recurrent and capital. Fair value The amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties, in an arms length transaction. Greenfield asset values** Asset (re)valuation values based on the cost to initially acquire the asset. Heritage asset An asset with historic, artistic, scientific, technological, geographical or environmental qualities that is held and maintained principally for its contribution to knowledge and culture iv

9 Naturally Better and this purpose is central to the objectives of the entity holding it. Impairment Loss The amount by which the carrying amount of an asset exceeds its recoverable amount. Infrastructure assets Physical assets of the entity or of another entity that contribute to meeting the public s need for access to major economic and social facilities and services, e.g. roads, drainage, footpaths and cycle ways. These are typically large, interconnected networks or portfolios of composite assets The components of these assets may be separately maintained, renewed or replaced individually so that the required level and standard of service from the network of assets is continuously sustained. Generally the components and hence the assets have long lives. They are fixed in place and are often have no market value. Investment property Property held to earn rentals or for capital appreciation or both, rather than for: (a) use in the production or supply of goods or services or for administrative purposes; or (b) sale in the ordinary course of business (AASB 140.5) Level of service The defined service quality for a particular service against which service performance may be measured. Service levels usually relate to quality, quantity, reliability, responsiveness, environmental, acceptability and cost). Life Cycle Cost** The life cycle cost (LCC) is average cost to provide the service over the longest asset life cycle. It comprises annual maintenance and asset consumption expense, represented by depreciation expense. The Life Cycle Cost does not indicate the funds required to provide the service in a particular year. Life Cycle Expenditure** The Life Cycle Expenditure (LCE) is the actual or planned annual maintenance and capital renewal expenditure incurred in providing the service in a particular year. Life Cycle Expenditure may be compared to Life Cycle Expenditure to give an initial indicator of life cycle sustainability. Loans/borrowings Loans result in funds being received which are then repaid over a period of time with interest (an additional cost). Their primary benefit is in spreading the burden of capital expenditure over time. Although loans enable works to be completed sooner, they are only ultimately cost effective where the capital works funded (generally renewals) result in operating and maintenance cost savings, which are greater than the cost of the loan (interest and charges). Maintenance and renewal gap Difference between estimated budgets and projected expenditures for maintenance and renewal of assets, totalled over a defined time (eg 5, 10 and 15 years). v

10 Maintenance and renewal sustainability index Ratio of estimated budget to projected expenditure for maintenance and renewal of assets over a defined time (eg 5, 10 and 15 years). Maintenance expenditure Recurrent expenditure, which is periodically or regularly required as part of the anticipated schedule of works required to ensure that the asset achieves its useful life and provides the required level of service. It is expenditure, which was anticipated in determining the asset s useful life. Materiality An item is material is its omission or misstatement could influence the economic decisions of users taken on the basis of the financial report. Materiality depends on the size and nature of the omission or misstatement judged in the surrounding circumstances. Modern equivalent asset A structure similar to an existing structure and having the equivalent productive capacity, which could be built using modern materials, techniques and design. Replacement cost is the basis used to estimate the cost of constructing a modern equivalent asset. Non-revenue generating investments Investments for the provision of goods and services to sustain or improve services to the community that are not expected to generate any savings or revenue to the Council, eg. parks and playgrounds, footpaths, roads and bridges, libraries, etc. Operating expenditure Recurrent expenditure, which is continuously required excluding maintenance and depreciation, eg power, fuel, staff, plant equipment, on-costs and overheads. Pavement management system A systematic process for measuring and predicting the condition of road pavements and wearing surfaces over time and recommending corrective actions. Planned Maintenance** Repair work that is identified and managed through a maintenance management system (MMS). MMS activities include inspection, assessing the condition against failure/ breakdown criteria/experience, prioritising scheduling, actioning the work and reporting what was done to develop a maintenance history and improve maintenance and service delivery performance. PMS Score A measure of condition of a road segment determined from a Pavement Management System. Rate of annual asset consumption* A measure of average annual consumption of assets (AAAC) expressed as a percentage of the depreciable amount (AAAC/DA). Depreciation may be used for AAAC. vi

11 Naturally Better Rate of annual asset renewal* A measure of the rate at which assets are being renewed per annum expressed as a percentage of depreciable amount (capital renewal expenditure/da). Rate of annual asset upgrade* A measure of the rate at which assets are being upgraded and expanded per annum expressed as a percentage of depreciable amount (capital upgrade/expansion expenditure/da). Reactive maintenance Unplanned repair work that carried out in response to service requests and management/ supervisory directions. Recoverable amount The higher of an asset s fair value less costs to sell and its value in use. Recurrent expenditure Relatively small (immaterial) expenditure or that which has benefits expected to last less than 12 months. Recurrent expenditure includes operating and maintenance expenditure. Recurrent funding Funding to pay for recurrent expenditure. Rehabilitation See capital renewal expenditure definition above. Remaining life The time remaining until an asset ceases to provide the required service level or economic usefulness. Age plus remaining life is economic life. Renewal See capital renewal expenditure definition above. Residual value The net amount which an entity expects to obtain for an asset at the end of its useful life after deducting the expected costs of disposal. Revenue generating investments Investments for the provision of goods and services to sustain or improve services to the community that are expected to generate some savings or revenue to offset operating costs, eg public halls and theatres, childcare centres, sporting and recreation facilities, tourist information centres, etc. Risk management The application of a formal process to the range of possible values relating to key factors associated with a risk in order to determine the resultant ranges of outcomes and their probability of occurrence. Section or segment A self-contained part or piece of an infrastructure asset. Service potential The capacity to provide goods and services in accordance with the entity s objectives, whether those objectives are the generation of net cash inflows or the provision of goods and services of a particular volume and quantity to the beneficiaries thereof. Service potential remaining* A measure of the remaining life of assets vii

12 expressed as a percentage of economic life. It is also a measure of the percentage of the asset s potential to provide services that is still available for use in providing services (DRC/DA). Strategic Management Plan (SA)** Documents Council objectives for a specified period (3-5 yrs), the principle activities to achieve the objectives, the means by which that will be carried out, estimated income and expenditure, measures to assess performance and how rating policy relates to the Council s objectives and activities. Sub-component Smaller individual parts that make up a component part. Useful life Either: (a) the period over which an asset is expected to be available for use by an entity, or (b) the number of production or similar units expected to be obtained from the asset by the entity. It is estimated or expected time between placing the asset into service and removing it from service, or the estimated period of time over which the future economic benefits embodied in a depreciable asset, are expected to be consumed by the Council. It is the same as the economic life. Value in Use The present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life. It is deemed to be depreciated replacement cost (DRC) for those assets whose future economic benefits are not primarily dependent on the asset s ability to generate new cash flows, where if deprived of the asset its future economic benefits would be replaced. Source: DVC 2006, Glossary Note: Items shown * modified to use DA instead of CRC Additional glossary items shown ** viii

13 Executive summary Naturally Better What Council Provides Council provides a Community Wastewater Management System (CWMS) network to enable the effective disposal of wastewater from approximately 4400 properties within the City of Tea Tree Gully. What does it Cost? There are two key indicators of cost to provide the CWMS service. The life cycle cost being the average cost over the life cycle of the asset and the total maintenance and capital renewal expenditure required to deliver existing service levels in the next 10 years covered by Council s long term financial plan. The life cycle cost to provide the CWMS service is estimated at $1,175,500 per annum. Council s planned life cycle expenditure for year 1 of the infrastructure and asset management plan is $745,000 which gives a life cycle sustainability index of 0.63 (index down 0.13 from 2008). The total maintenance and capital renewal expenditure required to provide the CWMS service the in the next 10 years is estimated at $14.01m. This is an average of $1,401,000 per annum. Council s average annual maintenance and planned capital renewal expenditure over 10 years is $760,000 giving a 10 year sustainability index of Plans for the Future Council plans to operate and maintain the CWMS network to achieve the following strategic objectives. 1. Ensure the CWMS network is maintained at a safe and functional standard as set out in this infrastructure and asset management plan 2. Ensure the existing CWMS network will meet the need of future urban infill 3. Investigate options of reuse of this valuable water resource. Measuring our Performance Quality CWMS assets will be maintained in a reasonably usable condition. Defects found or reported that are outside our service standard will be repaired. See our maintenance response service levels for details of defect prioritisation and response time. Function Our intent is that an appropriate CWMS network is maintained in partnership with other levels of government and stakeholders to meet statutory requirements of the SA Health Commission, EPA and the residents of CTTG. CWMS asset attributes will be maintained at a safe level and associated signage and equipment be provided as needed to ensure public safety. We need to ensure key functional objectives are met: A functional system A system that is maintained in efficient & cost effective manner. The main functional consequence of the CWMS 1

14 is to dispose of wastewater in efficient and cost effective manner. Safety We inspect all CWMS regularly and prioritise and repair defects in accordance with our inspection schedule to ensure they are safe. The Next Steps This actions resulting from this asset management plan are: Undertake pro active CCTV inspections of clay pipes nearing their 55 year useful life, as it is the maintenance and technical teams view that this is a highly conservative figure for the life of clay pipes (given the current operation levels Undertake CCTV reporting and compile an action plan for the remaining 250m of Fibrocement pipe left in the network Update register of blockages against pipe runs Update flow modelling of the piped system Undertake investigation into the process of acquiring easements where CWMS pipes currently rum through private property. 2

15 Introduction Naturally Better 2.1 Background This infrastructure and asset management plan is to demonstrate responsive management of CWMS assets (and services provided from assets), compliance with regulatory requirements, and to communicate funding required to provide the required levels of service. The infrastructure and asset management plan is to be read with the following associated planning documents: Council Strategic Plan Financial Plan This plan outlines all aspects of the key financial strategy objectives and commitments Funding Policy This policy states how future expenditure needs will be funded Annual Plan Detailed action plan on projects and finances for each particular year. The works identified in the AM Plan form the basis on which future annual plans are prepared Contracts The service levels, strategies and information requirements contained in the AM plans are translated into contract specifications and reporting requirements By-Laws, standards and policies These tools for asset creation and subsequent management are needed to support AM tactics Business Plans These service levels policies, processes and budgets defined in AM plans are incorporated into business plans as activity budgets, management strategies and performance measures This infrastructure and asset management plan covers the following infrastructure assets: All Councils CWMS assets comprising pipes, inspection points, junctions and manholes. All the costs of the network have been allocated against the pipes i.e. IP S, JB s and manholes at a rate of $310 per linear m (indexed from 2008). The network is distributed by pipe type as shown in Table 2.1. Table 2.1 Assets covered by this plan Asset category Dimension (m) Replacement value ($m) Clay pipes 88,706 $27,702,761 Asbestos cement pipes 239 $119,686 Iron pipes (as outer casing for creek 134 $41,945 crossings) Polyethylene pipes 6371 $2,054,217 PVC 16,008 $5,099,777 CIPP Liner 175 $66,500 Total 112 $35,084,886 3

16 Key stakeholders in the preparation and implementation of this Infrastructure and Asset Management Plan are: Community Government Elected members of Council Employees/volunteers Visitors Utilities Developers Contractors/suppliers Insurers End user of Council s CWMS service Regulates the service through the Environmental Health Act Make policy decisions relating to provision of the service Maintain and renew the system End user of Council s CWMS service Recipient for primary treated effluent collected by Council Meet Council requirements for new development within the STEDS catchments Provide the human and physical resources to undertake renewal of the system Partner with Council to mutually cover risk exposure 2.2 Goals and objectives of Asset Management The Council exists to provide services to its community, some of these services are provided by infrastructure assets. Council has acquired infrastructure assets by purchase, by contract, construction by Council staff and by donation of assets constructed by developers and others to meet increased levels of service. Council s goal in managing infrastructure assets is to meet the required level of service in the most cost effective manner for present and future consumers. The key elements of infrastructure asset management are: Taking a life cycle approach Developing cost-effective management strategies for the long term Providing a defined level of service and monitoring performance Understanding and meeting the demands of growth through demand management and infrastructure investment Managing risks associated with asset failures Sustainable use of physical resources Continuous improvement in asset management practices. 2 2 IIMM 2006 Sec 1.1.3, p.1.3 4

17 Naturally Better This Infrastructure and Asset Management Plan is prepared under the direction of Council s vision, mission, goals and objectives. Council s vision is The City of Tea Tree Gully provides a truly unique lifestyle. It is both a City of choice and a city of choices, providing a diverse range of housing together with public, commercial, learning, recreation and health facilities, located centrally to residential neighbourhoods to minimise the need for travel and to maximise accessibility for all. An emphasis on sustainable development, a focus on family values and genuine engagement between Council, residents, and other levels of Government creates a strong sense of community for the City. The City of Tea Tree Gully is a great place to live, work and visit; a City that provides a clean, green environment and encourages community wellbeing. Relevant Council targets and measures and how these are addressed in this infrastructure and asset management plan are: Relevant Council targets and measures and how these are addressed in this Infrastructure and Asset Management Plan are: Table 2.2 Council Goals and how these are addressed in this Plan Target Measure How target and measure are addressed in IAMP Physical infrastructure Audit of existing infrastructure completed by July 2012 Water and landscape management Increase the use of non-mains water used to water reserves to at least 90% by 2011 Reduce the consumption of mains water overall on Council property All infrastructure recorded Percentage of non-mains water used annually on reserves Compliance with Code of Practice for irrigated Public Open Space Compilation of this IAMP includes a brief audit of Council data relative to CWMS assets. CWMS re-use facility fully operational by Vision for future CWMS management involves reuse of effluent. 5

18 Target Measure How target and measure are addressed in IAMP Community health Ensure that the City of Tea Tree Gully maintains a measure of community health above the Adelaide Statistical Division average Statutory responsibilities Council to comply with the statutory requirements as directed by legislation Assets and service delivery Develop a minimum 10 year Asset Management Strategy by the end of 2012 Update the Asset Management Strategy annually to have expenditure on refurbishment and/or replacement assets meet annual depreciation values by 2011 Australian Bureau of Statistics wellbeing framework data by comparison to Tea Tree Gully Compliance with legislation Infrastructure Asset Management Plans and Strategies (transport, buildings and stormwater) approved by Council. Expenditure for refurbishment and/or replacement assets meets annual depreciation estimates Effective management of CWMS assets will ensure that the public health is protected. Proactive management of CWMS assets will ensure that Council complies with EPA legislation relating to spills. The development of this IAMP satisfies this requirement. This IAMP contains provides linkages to Councils long term financial plan relating to required funding for CWMS infrastructure. 6

19 Naturally Better Target Measure How target and measure are addressed in IAMP Financial management and risk Financial principles as adopted by Council are met annually, including: Balanced budget Funded depreciation Debt limitations Review of assets Staff limitations Financial principles met and included in Council s Annual Business Plan. Audited financial statements signed and reported. This IAMP contains provides linkages to Councils long term financial plan relating to required funding for CWMS infrastructure. Council rate limitations Maintain Council s Risk Management Performance 2% above the Local Government Metropolitan average. 2.3 Plan Framework Key elements of the plan are Comparison to Metropolitan average (Local Government Association Mutual Liability Scheme) The development of an associated risk management plan as a sister document to this IAMP places Council in a good position to satisfy this requirement. Levels of service specifies the services and levels of service to be provided by Council Future demand how this will impact on future service delivery and how this is to be met Life cycle management how Council will manage its existing and future assets to provide the required services Financial summary what funds are required to provide the required services Asset management practices Monitoring how the plan will be monitored to ensure it is meeting Council s objectives Asset management improvement plan. 7

20 A road map for preparing an Infrastructure and Asset Management Plan is shown below. Road Map for preparing an Asset Management Plan Source: IIMM Fig 1.5.1, p 1.11 CORPORATE PLANNING Confirm strategic objectives and establish AM policies, strategies & goals. Define responsibilities & ownership. Decide core or advanced AM Pan. Gain organisation commitment. REVIEW/COLLATE ASSET INFORMATION Existing information sources Identify & describe assets. Data collection Condition assessments Performance monitoring Valuation Data AM PLAN REVIEW AND AUDIT INFORMATION MANAGEMENT, and DATA IMPROVEMENT ESTABLISH LEVELS OF SERVICE Establish strategic linkages Define & adopt statements Establish measures & targets Consultation LIFECYCLE MANAGEMENT STRATEGIES Develop lifecycle strategies Describe service delivery strategy Risk management strategies Demand forecasting and management Optimised decision making (renewals, new works, disposals) Optimise maintenance strategies DEFINE SCOPE & STRUCTURE OF PLAN IMPLEMENT IMPROVEMENT STRATEGY FINANCIAL FORECASTS Lifecycle analysis Financial forecast summary Valuation Depreciation Funding IMPROVEMENT PLAN Assess current/desired practices Develop improvement plan IS THE PLAN AFFORDABLE? ITERATION Reconsider service statements Options for funding Consult with Council Consult with Community ANNUAL PLAN / BUSINESS PLAN 8

21 Naturally Better 2.4 Core and advanced asset management This Infrastructure and Asset Management Plan is prepared as a core asset management plan in accordance with the International Infrastructure Management Manual. It is prepared to meet 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. Future revisions of this Infrastructure and 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. 9

22 Levels of service 3.1 Customer research and expectations While Council has not carried out any customer research directly relating to the stormwater service it provides, Council conducts an annual community survey survey which aims to obtain a high level understanding of resident s views of Council s services, including service awareness, usage and value as well as satisfaction with key services. Since 2011 we have commissioned 400 x 15 minute CATI (Computer Assisted Telephone Interviews) interviews to be conducted on our behalf, with the most recent survey conducted in March The following results from this survey relate indirectly to stormwater assets and compares data from 2011 to Overall satisfaction with Council s performance Overall, how satisfied or dissatisfied are you with Council s performance? % response Very dissatisfied Dissatisfied Neither satisfied nor dissatisfied Satisfied Very satisfied (n=399) 2012 (n=397) 10

23 Naturally Better Environmentally sustainable principles How satisfied or dissatisfied are you with Council s performance in delivering long term environmental benefits through its initiatives and programs? % response Very dissatisfied Dissatisfied Neither satisfied nor dissatisfied Satisfied Very satisfied (n=356) 2012 (n=319) Future revisions of this IAMP will include results of customer service surveys more directly applicable to stormwater. Council uses this information in developing the Strategic Management Plan and in allocation of resources in the budget. 3.2 Legislative requirements Council has to meet many statutory requirements of both National and State legislation. Table 3.2 Legislative requirements Legislation Requirements Local Government Act 1999 Sets out role, purpose, responsibilities and powers of local governments including the preparation of a Long Term Financial Plan supported by Infrastructure and Asset Management Plans for sustainable service delivery. Environment Protection Act An Act to provide for an Environmental Protection Authority, for the prevention, control and abatement of pollution and environmental harm and for the conservation, preservation, protection, enhancement and management of the environment. Public and Environmental Health Act 1987 Public and Environmental Heath (Waste Control) Regulations 1995 Provides legislative credence to the Public and Environmental Heath (Waste Control) Regulations Set out details of approval mechanisms and inspection and compliance regulations for STEDS (septic tank effluent disposal schemes), now known as CWMS. 11

24 Legislation Water Resources Act 1997 Environment Protection Authority Code of Practice for Wastewater Overflow Management EPA 2003 Environment Protection (Water Quality) Policy EPA 2003 Requirements Act to provide for the management of the State s water resources. Details of the requirements for an Emergency Response plan and risk management issues. Prohibits the disposal of treated effluent to all waterways for both new and old CWMS where the policy criteria is not met. 3.3 Current Levels of Service Council has defined service levels in two terms. Community Levels of Service relate to how the community receives the service in terms of safety, quality, quantity, reliability, responsiveness, cost/efficiency and legislative compliance. Supporting the community service levels are operational or technical measures of performance developed to ensure that the minimum community levels of service are met. These technical measures relate to service criteria such as: Service criteria Technical measures may relate to Quality Smoothness of roads Quantity Areas of parks per resident Availability Distance from a dwelling to a sealed road Safety Number of injury accidents Council s current service levels are detailed in Table

25 Naturally Better Table 3.3 Current service levels Key Level of service performance measure Community levels of service Quality Provide an effective method of collection and disposal of wastewater Performance measure process Consumer complaints related to blockages Speed of response to reported complaints Performance target < 100 complaints reported 2011/12 Two hour response to blockages, five days to written correspondence Current performance 79 complaints reported 11/12 Four hour response to blockages, 14 days to written correspondence Function Meet SA Health Dept standards as set out in conditions of approval Safety Low level of risk to public/ staff through the through the collection and disposal of septic tank effluent. Technical levels of service Condition Provide appropriate levels of operation maintenance and renewal to provide a reliable service No. of system overflows No of reported CWMS health issues Frequency with which all septic tanks pumped out and cleared No of blockages cleared Nil pa to drainage system Nil Four years 100 blockages, One pa to drainage system Nil Four years 79 blockages,

26 Key performance measure Cost effectiveness Function Level of service Provide service in the most cost effective manner Capacity of pipe network 3.4 Desired levels of service Performance measure process Annual fee charged to users No of surcharges recorded per year Performance target Fee indexed in line with equivalent SA Water charge. 2 per year following high rain event Current performance $455 annual fee to residents 6 per yr following high rain event At present, indications of desired levels of service are obtained from various sources including the City of Tea Tree Gully Customer Satisfaction survey, residents feedback to Councillors and staff, service requests and correspondence. Council has yet to quantify desired levels of service. This will be done in future revisions of this Infrastructure and Asset Management Plan. 14

27 Future demand Naturally Better 4.1 Demand forecast Factors affecting demand include population change, changes in demographics, seasonal factors, vehicle ownership, consumer preferences and expectations, economic factors, agricultural practices, environmental awareness, etc. Demand factor trends and impacts on service delivery are summarised in table 4.1. Table 4.1 Demand factors, projections and impact on services Demand factor Present position Projection Impact on services Population 100,979 (2012) 105,372 (2031) Population increase in isolation will result in an increase in effluent output into the CWMS.* Population density 2.58 (2012) 2.46 (2031) Decrease in population density in isolation i.e. no. persons per dwelling will result in a decrease in effluent output into the CWMS.* Urban consolidation Allotment size on average 800m2 Allotment size following subdivision of individual allotments in isolated locations 350m2 No of connections to CWMS within catchments increases*. * The growth of the population of the City is expected to be manifested through new Greenfield development and urban consolidation. The CWMS network however only covers approximately 12% of the Council population with the remainder being serviced by the SA Water sewer network. There is expected to be approximately 12 new connections per year resulting from urban consolidation within the existing CWMS network. This is likely to result in new infrastructure to Council per annum of approximately $45,000. (Connection charge fees under CWMS section). 4.2 Changes in Technology Technology changes are forecast to affect the delivery of services covered by this plan in the following areas. 15

28 Table 4.2 Changes in technology and forecast effect on service delivery Technology change Reuse of CWMS effluent Effect on service delivery Enhanced delivery of services for recreation through irrigation of reserves. The longer-term vision is for Council to treat and reuse CWMS effluent to assist in the City of Tea Tree Gully becoming self sufficient in its irrigation water needs. The investigations and research undertaken to date on the treatment and re-use of STED effluent has been summarised in a strategic planning concept titled The City of Tea Tree Gully Integrated Water Resource Management Scheme The harvesting of effluent takes place from SA Water s sewer main, which has no impact on the flow. 4.3 Demand Management Plan Demand for new services will be managed through a combination of managing existing assets, upgrading of existing assets and providing new assets to meet demand and demand management. Demand management practices include non-asset solutions, insuring against risks and managing failures. Opportunities identified to date for demand management are shown in table 4.3. Further opportunities will be developed in future revisions of this Infrastructure and Asset Management Plan. Table 4.3 Demand Management Plan summary Service activity Demand management example Capacity of CWMS system to handle existing and increased flows Surcharge of the systems in periods of high rainfall. 4.4 New assets from growth Flow modelling of the CWMS system has been undertaken on the main pipe runs and has been partially used as the basis for generating renewal programs. Investigations have been undertaken to determine which properties discharge stormwater into the CWMS system. As discussed in section 4.1new assets from growth for the Councils CWMS network come about by urban consolidation within the existing sections of the Council serviced by CWMS rather than new Greenfield development. The new asset values are summarised in Figure 1. 16

29 Naturally Better Figure 1 New assets from growth Acquiring these new assets will commit council to fund ongoing operations and maintenance costs for the period that the service provided from the assets is required. These future costs are identified and considered in developing forecasts of future operating and maintenance costs. 17

30 Lifecycle management plan The lifecycle management plan details how Council plans to manage and operate the assets at the agreed levels of service (defined in section 3) while optimising life cycle costs. 5.1 Background data Physical parameters The assets covered by this infrastructure and asset management plan are shown in the chart below distributed by the cumulative length of pipe by material Length (m) CLAY FIBR IRON POLY PVC CIPP Liner Pipe Type The original construction type of all the pipes was clay. The length of polyethylene and PVC pipe shown in this graph reflects Councils fairly recent renewal program of clay pipes with modern flexible materials not subject to root intrusion. The age profile of Council s assets is shown on the next page in Figure 2. 18

31 Naturally Better Figure 2 Asset age profile The majority of the Councils network was constructed in the period between 1963 and 1972 to support urban development within portions of the Council not serviced by the State Government sewer network. Older portions of this network were subsequently replaced by Council from 1998 as shown in the latter timeframe on the x axis which reflects renewals rather than new construction Asset capacity and performance Council s services are generally provided to meet design standards where these are available. Detailed records have been kept of blockages within each of the CWMS pipelines over an extended period of time up to approximately This data was used to develop an extensive pipe replacement program between 1998 and At it s peak over this period of time approximately $1.3m per annum was spent on pipe renewal. This pipe renewal program was concentrated on replacing old mortar joint clay pipes with PVC/PE pipes. Accordingly the network meets all current capacity and performance standards. 19

32 5.1.3 Asset condition Council does not currently have detailed condition data on its buried CWMS pipe network. The pipe network has historically been replaced based on the level of service it provides to the community. This level of service has been measured by the number of blockages recorded. Data on blockages within the system have been recorded from 1999/00 to 2011/12 and are shown in Figure 3. Figure 3 CWMS pipe blockages No blockages / / / / / / / / / / / / /2012 Year The blockage information that has been recorded in effect is a measure of condition of the pipe network overall. As pipes in poor condition (mortar jointed clay pipes subject to root intrusion) are replaced the number of blockages recorded is reduced over the network as a whole. As can be seen by reference to the above graph, the number of blockages has been deceasing following the replacement program that was instituted in

33 Naturally Better Asset Valuations The value of Building assets as at 30 June 2012 covered by this Infrastructure and Asset Management Plan is summarised below. Building Assets were last valued at 30 June 2012 and are scheduled to be valued again, by the next AMP. Assets are valued at Replacement Cost. Current replacement cost $35,035,000 Depreciable amount (DA) $35,035,000 Depreciated replacement cost 13,982,000 [(1-Age/UsefulLife)*CRC] Annual Depreciation Expense $585,500 (DRC/(UsefulLife-Age) Council s sustainability reporting reports the rate of annual asset consumption and compares this to asset renewal and asset upgrade and expansion. Asset consumption 1.67% (ADE/DA)*100 Asset renewal 0.44% ($155K/$35035K) Annual Upgrade/expansion 0.13% ($45K/$35035K) 5.2 Risk Management Plan An assessment of risks 2 associated with service delivery from infrastructure assets has identified critical risks to Council. The risk assessment process identifies credible risks, the likliehood of the risk event occurring, the consequences should the event occur, develops a risk rating, evaluates the risk and develops a risk treatment plan for non-acceptable risks. Critical risks, being those assessed as Very High - requiring immediate corrective action and High requiring prioritised corrective action identified in the infrastructure risk management plan are summarised in Table Council s CWMS Infrastructure Risk Management Plan 21

34 Table 5.2 Critical risks and treatment plans Demand factor Present position Projection Impact on services CWMS pipe network Damage to pipe network and possible loss of service due to lack of easements over pipe runs in private property. Extreme Undertake search of titles which do not have easements and develop strategy to acquire them. $25k approx cost Council is acquiring a licence for its CWMS network under the new Water Industry Act This will give Council certain rights in relation to protecting buried assets against development that are not protected by easements. Council will have a licence as of 1 January 2013 $X per annum 5.3 Routine maintenance plan Routine maintenance is the regular on-going work that is necessary to keep assets operating, including instances where portions of the asset fail and need immediate repair to make the asset operational again Maintenance plan Maintenance includes reactive, planned and cyclic maintenance work activities. Reactive maintenance is unplanned repair work carried out in response to service requests and management/supervisory directions. Planned maintenance is repair work that is identified and managed through a maintenance management system (MMS). MMS activities include inspection, assessing the condition against 22

35 Naturally Better failure/breakdown experience, prioritising, scheduling, actioning the work and reporting what was done to develop a maintenance history and improve maintenance and service delivery performance. Cyclic maintenance is replacement of higher value components/sub-components of assets that is undertaken on a regular cycle including repainting, building roof replacement, etc. This work generally falls below the capital/maintenance threshold. Maintenance expenditure trends are shown in Table Table Maintenance expenditure trends Year Maintenance expenditure Reactive Planned $179,000 $537, $163,000 $489, (budget) $147,500 $442,500 Planned maintenance work is 75% of total maintenance expenditure. Planned maintenance comprises the following: Desludging residents septic tanks Ad hoc repairs to the system IP raising program. Reactive maintenance comprises the following: Clearing blockages Planned repairs to the system. Council currently does not report separately on cyclic maintenance. Maintenance expenditure levels are considered to be adequate to meet required service levels. Future revision of this infrastructure and asset management plan will include linking required maintenance expenditures with required service levels. Reactive maintenance is carried out in accordance with response levels of service detailed in the Septic Tank Effluent Disposal Works Agreement, an extract of which is attached as Appendix A Standards and specifications Maintenance work is carried out in accordance with the following Standards and Specifications. Septic Tank Effluent Disposal Maintenance Management Works Agreement, Council document no.c8/1. 23