The Regional Municipality of Halton Asset Management Plan. Version 2.0

Transcription

1 The Regional Municipality of Halton Asset Management Plan Version

2 Preface Halton Region Halton Region includes the City of Burlington, the Town of Halton Hills, the Town of Milton, and the Town of Oakville. Halton is situated on the northern shore of Lake Ontario and lies within the industrial and commercial heartland of Ontario, Canada. The Region is within a 640 km radius of some of the largest population centres and markets in North America. Halton s location within the Greater Toronto Area, as well as its close proximity to the United States, translates into expanded business and professional employment opportunities for residents. Halton Region s infrastructure includes an integrated transportation network of roads and bridges, storm water management, water purification and distribution, wastewater collection and treatment, waste management collection, disposal and recycling assets, paramedic services, public health services, services for vulnerable residents (social housing, long-term care for seniors and child care facilities and subsidies), and administration facilities for police and other service departments. Asset Management Plan An Asset Management Plan is an integrated, life cycle approach to effective stewardship of infrastructure assets to maximize benefits, manage risk and meet desired levels of service in a sustainable and environmentally-responsible manner. The overall asset management process takes an organization s objectives, determines how these rely on infrastructure, and then develops a plan to provide the supporting infrastructure services at the lowest life cycle cost. Asset management is essential to the development of a common, systematic understanding of what needs are most important and how they can be addressed. Life Cycle Costing looks at the total cost of an asset over its entire useful life, from construction to disposal, including operating costs. A key objective of an Asset Management Plan is to identify investment strategies that achieve desired levels of service at the lowest life cycle cost. Asset Management Planning is the process of making the best possible decisions regarding the construction, operation, maintenance, renewal, replacement, expansion and disposal of infrastructure assets. Asset management planning requires a thorough understanding of the characteristics and condition of infrastructure assets, as well as the service levels expected from them. It also involves setting strategic priorities with investments and identifying critical assets for the development of a minimum life cycle cost. Finally, it requires the development of a Budget and Business Plan, to ensure that sustainable funding is provided to support the Asset Management Plan. Halton Region Asset Management Plan 2014 i

3 Halton s Asset Management Plan describes the infrastructure that it owns, operates and maintains to support its core services. This document identifies what has been achieved, what is being done and what needs to be done to ensure core services provided to citizens, businesses and institutions are delivered based on desired levels of service while maintaining financial sustainability. It is a compilation of many documents and therefore many other Halton documents contain additional levels of detail and are referenced in this document including but not limited to the following: Council reports, project initiatives, Regional Budget and Business Plan, The Citizens Priorities Action Plan, Master Plans, Management Strategy Reports, Financial Systems, Asset Management Systems and departmental Asset Management Plans. Halton Region Asset Management Plan 2014 ii

4 TABLE OF CONTENTS GLOSSARY OF TERMS EXECUTIVE SUMMARY PART 1 PUBLIC WORKS Introduction Asset Management Plan Purpose Assets Included in the Plan Asset Management Plan Development and Timeline Asset Management Plan Updates STATE OF LOCAL INFRASTRUCTURE Asset Types Asset Valuation Asset Age Distribution Asset Condition Infrastructure Condition Report Card Asset Inventory Database Assumptions Data Verification and Condition Assessment Policy DESIRED LEVELS OF SERVICE Defined Levels of Service Transportation Water Wastewater Waste Management External Trends and Issues Transportation Halton Region Asset Management Plan 2014 iii

5 Water Wastewater Waste Management Performance Measurement Transportation Water Wastewater Waste Management ASSET MANAGEMENT STRATEGY Non-infrastructure Solutions Transportation Water Wastewater Waste Management Maintenance Activities Transportation Water Wastewater Waste Management Renewal/Rehabilitation Activities Transportation Water Wastewater Waste Management Replacement Activities Disposal Activities Expansion Activities Halton Region Asset Management Plan 2014 iv

6 5.7 Procurement Methods Risks Associated with the Strategy Options Analysis Direct Benefits and Costs Indirect Benefits and Costs Asset Management Strategy and the Budget and Business Plan FINANCING STRATEGY Financing Plan Development Current Financing Plan Summary PUBLIC WORKS FOOTNOTES PUBLIC WORKS APPENDICES PW1 PW Asset Management Roadmap PW2 Infrastructure Asset Values PW3 PW Long Range Life Cycle Plans Long Range Life Cyle Plan Limitations and Assumptions PW3-1 Transportation PW3-2 Waste Management PW3-3 Water and Wastewater PW4 Capital Budget Process PW5 Asset types PW5-1 Transportation Asset Types PW5-2 Plant Facilities Asset Types PW5-3 Water and Wastewater Linear Asset Types PW5-4 Waste Management Asset Types PW6 Remaining useful life PW7 Asset record PW7-1 RIVA asset record Halton Region Asset Management Plan 2014 v

7 PW7-2 SAP asset record PW8 TCA Asset System Architecture PW9 Roadway Appraisal Sheet PW10 Structure Inspection Form PW11 Wastewater System Effluent Monitoring Report PW12 Region Wide and Spatial Distribution PW13 CCTV Sewer Main Snap Shots PW14 Transportation Master Plan Capital Plan PW15 PW Budget Process PW16 Halton Region Reserve Policy PW17 Financing Strategy Process for Capital Expenditures PW18 Region of Halton Asset Management Framework PART 2: CORPORATE FACILITIES AND SOCIAL HOUSING INTRODUCTION Asset Management Plan Purpose Assets Included in the Plan Asset Management Plan Development and Timeline Asset Management Plan Evaluation and Ongoing Improvements STATE OF LOCAL INFRASTRUCTURE Asset Types Asset Valuation Asset Age Distribution Asset Condition Assessments Asset Information Sources Policies and Procedures DESIRED LEVELS OF SERVICE Levels of Service Halton Region Asset Management Plan 2014 vi

8 External Trends and Issues Asset Performance ASSET MANAGEMENT STRATEGY Life Cycle Costs and Options Analysis Risk Assessment Project Prioritization Project Plans Procurement Methods FINANCING STRATEGY Financing Plan Development Current Financing Plan Summary CORPORATE FACILITIES AND SOCIAL HOUSING FOOTNOTES CORPORATE FACILITIES AND SOCIAL HOUSING APPENDICES AM 1 Asset Management Capital Budget Development AM 2 Corporate and Social Housing Assets Infrastructure Condition Report Card AM 3 Deferred Capital Budget Sample AM 4 Excerpt from TCA Policies for Facilities and Building AM 5 UNIFORMAT II AM 6 Excerpt from Halton Region Purchasing Policy AM 7 Budget Plan Sample AM 8 10-Year Expenditure Plan Sample AM 9 Life Expectancy AM 10 Replacement Values AM 11 Capital Planning Software Sample Snapshots Halton Region Asset Management Plan 2014 vii

9 GLOSSARY OF TERMS Active Transportation Active transportation means non-motorized or lightly-motorized travel, including walking, cycling, roller-blading and movements with mobility devices. The active transportation network includes sidewalks, crosswalks, designated road lanes and off-road trails to accommodate active transportation. Asset Capital Asset capital is defined as equipment which is fixed, built-in or permanently affixed to a building structure. It can also refer to infrastructure. Asset Management (AM) AM is the process of making the best possible decisions regarding the construction, operation, maintenance, renewal, replacement, expansion and disposal of infrastructure assets. Asset Management Plan (AMP) An AMP is an integrated, life cycle approach to effective stewardship of infrastructure assets to maximize benefits, manage risk and provide satisfactory levels of service in a sustainable and environmentally-responsible manner. The overall asset management process analyzes an organization s objectives and determines reliance on infrastructure, and then develops a plan to provide the supporting infrastructure services at the lowest life cycle cost. Asset Management Planning Asset Management Planning is the process of making the best possible decisions regarding the construction, operation, maintenance, renewal, replacement, expansion and disposal of infrastructure assets. Asset management planning requires a thorough understanding of the characteristics and condition of infrastructure assets, as well as the service levels expected from them. It also involves setting strategic priorities with investments and identifying critical assets for the development of a minimum life cycle cost. Finally, it requires the development of a Budget and Business Plan, to ensure that sustainable funding is provided to support the Asset Management Plan. Asset Management Strategy (AMS) The AMS is the set of planned actions that will enable the assets to provide the desired levels of service in a sustainable way, while managing risk, at the lowest life cycle cost (e.g., through preventative action). The AMS is the set of actions that, taken together, has the lowest total cost not the set of actions that each has the lowest cost individually. Halton Region Asset Management Plan

10 Basement Flooding Prevention Subsidy Program The Halton program offers residents a one-time subsidy to assist residents who 1) have a history of basement floods caused by a backup or surcharge of the sanitary sewer system; or 2) Halton residents who have not experienced flooding but would like to correct improper storm water connections and install a backwater valve. The Big Move (Metrolinx Regional Transportation Plan) The Big Move is a 25-year, $50-billion plan for coordinated, integrated transportation and transit in the Greater Toronto and Hamilton Area launched in 2008 by Metrolinx. Net Book Value (or Book Value) The Book Value is the difference between the acquisition cost of a Tangible Capital Asset less its accumulated amortization. It represents the unconsumed acquisition cost of a Tangible Capital Asset attributable to its remaining service life. Write-downs due to obsolescence or reductions to the asset s useful life also reduce the Book Value. Bridge Condition Index (BCI) A BCI rating is a planning tool that helps schedule maintenance and upkeep. The BCI is not used to rate or indicate the safety of a bridge. The result is organized into a range from 0 to 100 (poor to excellent). Building Condition Assessment (BCA) The BCA is the first part of a capital reserve plan. The report describes: the condition of the capital items; when they are anticipated to be replaced; how much the replacement would cost at the present day and in the anticipated year of replacement; and what priority to give the replacement. The BCA is based on a review of property documents and a review of the capital items. Capital Planning Software (CPS) CPS helps organizations develop detailed capital plans by taking into account repair and replacement costs, urgency, and future needs. The CPS generates and compares costs across multiple scenarios and develops a deferred maintenance program along with determining building component life cycles. Consultants and end-users can both benefit from using CPS to generate and compare costs across multiple scenarios. CPS has features that assist with cataloging deferred maintenance and determining building component life cycles. Halton Region Asset Management Plan

11 Capital Reserves Also known as replacement reserves, these are funds set aside to replace and repair major capital infrastructure in the future. Capital Reserve Plan A capital reserve plan sets out: the replacement that must be made each year to keep the asset in good repair; and how much money is to be put aside each year to pay for the replacements in the future. Carbonaceous Biochemical Oxygen Demand (cbod) A testing method measured by the depletion of dissolved oxygen by biological organisms in a body of water in which the contribution from nitrogenous bacteria has been suppressed. cbod is a method-defined parameter widely used as an indication of the pollutant removal from wastewater. Certificate of Approval (CoA) In Ontario, any organization that intends to emit chemicals to the air must first submit an application to the Ontario Ministry of Environment (MOE) for a CoA for air emissions and noise. In the case of water systems, it is superseded by the Drinking Water Licence. The Citizens Priorities Action Plan On June 22, 2011, Regional Council approved The Citizens Priorities Action Plan for Halton Region. Each new term, Halton Regional Council develops a plan to reflect Council s priorities and focus on what services are important to Halton residents. This Action Plan is fundamentally different from other plans Halton has developed in the past because of how closely Halton worked with residents at the beginning of the development process. Closed-circuit Television (CCTV) Inspections Video inspections of linear assets to determine condition and replacement/rehabilitation needs. Computer Maintenance Management System (CMMS) A CMMS software package maintains a computer database of information about an organization s maintenance operations. This information is intended to help maintenance workers do their jobs more effectively (e.g. determining which machines require maintenance and which storerooms contain the spare parts they need), and to help management make informed decisions such as calculating the cost of machine breakdown repair versus preventive maintenance for each machine, possibly leading to better allocation of resources. Halton Region Asset Management Plan

12 Condition Assessment Reports These reports review infrastructure condition and identify needs for asset maintenance, renewal and replacement, with recommended timing of projects and estimated costs. Debentures A debt instrument issued by a municipal corporation and secured by municipal general revenues. Drinking Water Quality Management Systems (DWQMS) A repository of information for Halton s drinking water infrastructure and all related business processes. It contains all Public Works procedures, policies, manuals, instructions, specifications and forms related to operation of the water system. It also contains the Operational Plan as required by the Drinking Water Licence. Environmental Compliance Approvals (ECAs) Provincial legislation on how to operate an individual system/facility. Approval from the Ontario Ministry of Environment (MOE) which addresses emissions, discharges and wastes. Facility Condition Index (FCI) An industry standard asset management tool which measures the constructed asset s condition at a specific point in time. It is a functional indicator resulting from an analysis of different but related operational indicators (such as building repair needs) to obtain an overview of a building s condition as a numerical value. Fire Flow A rate of flow supplied by the water distribution system for fire fighting purposes usually specified as litres per second at 140 kilopascal (kpa). GIS (Geographic Information System) A system designed to capture, store, manipulate, analyze, manage and present all types of geographical data. Halton Region uses an ESRI platform. Grant A transfer of money from one organization to another. In the case of local governments, grants can be one of two types - conditional or unconditional. Conditional grants are monies transferred for a specific purpose that may not be used for any other project. Unconditional grants can be used for any purpose the recipient sees fit. Halton Region Asset Management Plan

13 HR-F78 Facility Project Fact Sheet Drinking Water Quality Management Systems (DWQMS) document showing form used to provide background information for non-development facility capital budget items. HR-F79 Linear Project Fact Sheet Drinking Water Quality Management Systems (DWQMS) document showing form used to provide background information for non-development linear capital budget items. HR-P37 Review and Provision of Infrastructure Drinking Water Quality Management Systems (DWQMS) document further identifying the process followed in the review of water infrastructure. HR-W88 Infrastructure Review Drinking Water Quality Management Systems (DWQMS) document identifying the process followed in the review of water infrastructure. Industrial, Commercial, Institutional Construction (ICI) ICI stands for Industrial, Commercial, Institutional construction. Inflow and Infiltration (I&I) Program Structural and operational repairs that help to stop inflow and infiltration from entering into the collection system. Life Cycle Costing Life Cycle Costing looks at the total cost of an asset over its entire useful life, from construction to disposal, including operating costs. Manhole Assessment and Certification Program (MACP) Industry Standards A program for the grading of defects within manholes using the established defect coding system found in the Pipeline Assessment and Certification Program (PACP). Master Plans A comprehensive review and analysis of servicing requirements based on planning growth estimates following the Municipal Engineers Association Class Environmental Assessment process. Halton Region Asset Management Plan

14 Non-residential Building Construction Price Indices (NRBCPI) A quarterly series measuring the changes in contractors' selling prices of non-residential building construction (i.e. commercial, industrial and institutional). The index relates to both general and trade contractors' work and excludes the cost of land, land assembly, design, development and real estate fees. Pavement Management Pavement management is the process of planning the maintenance and repair of a network of roadways in order to optimize pavement conditions over the entire network. Pavement Quality Index (PQI) A numerical index between 0 and 100 or 0 and 10 (poor to excellent) which is used to indicate the general condition of pavement. Pipeline Assessment and Certification Program (PACP) An industry coding standard that provides standardization and consistency in how sewer pipe condition and closed-circuit television (CCTV) inspection results are coded and managed through the National Association of Sewer Service Companies (NASSCO) and the Canadian Standards Association (CSA). Preventative Maintenance Program Inspection, testing and calibration of electrical and mechanical instrumentation and control equipment performed and documented by fully-trained and qualified technicians as is recommended by the original equipment manufacturer (OEM). Program Capital Program capital is based on modifications to a building as program needs change and the expenditures are for capital items of a less than permanent nature and normally at a lower cost. Project Capital Project capital expenditures are for the construction, expansion, replacement or major renovation of any new facility, either free-standing or addition of physical structures. PS 3150 Tangible Capital Assets (TCA) The accounting standard relating to TCA issued by the Public Sector Accounting Board (PSAB) of the Chartered Professional Accountants Canada (CPA Canada, formerly the Canadian Institute of Halton Region Asset Management Plan

15 Chartered Accountants). This standard came into effect for Halton Region on January 1, 2009 and mandated that TCA be reported in the balance sheet, similar to the private sector. Public Sector Accounting Board (PSAB) PSAB is an independent body with the authority to set accounting standards for the public sector. Public Works (PW) Halton Region s department responsible for transportation, water, wastewater and waste services including asset planning, construction, operation and maintenance of the related infrastructure. Region s Official Plan Amendment (ROPA) Halton's Regional Official Plan which outlines the Region s approved policy for development and growth. It outlines specific goals and objectives that Regional Council and Halton citizens believe are important. It also contains policies related to a wide range of topics including, but not limited to the following. Setting urban area boundaries to accommodate growth and to protect farmland. Protection of environmentally-sensitive areas and promotion of land stewardship. Promotion of economic development. Delivery of urban services such as water supply and wastewater treatment, transportation, energy and utilities. Building healthy, complete and sustainable communities. The Regional Official Plan also lays out a strategy for implementing and achieving these goals and objectives, including ongoing monitoring of the effectiveness of plan policies. RIVA (Real-time Infrastructure Valuation Analysis platform) RIVA connects with and exchanges data between SAP, GIS and Microsoft. The integration allows for real-time interaction within systems. Halton s RIVA Online Process Engine integrates and consolidates all assets from source systems including GIS before triggering their creation in SAP. Road Maintenance Level of Service (LOS) The Road Maintenance LOS defines the activities to be carried out in the maintenance of the Region s road infrastructure and establishes the time frames within which those activities will be completed. Road Needs Study The Road Needs Study provides an overview of the overall condition of the road system, by section, including such factors as capacity, geometry, surface width, surface type, structural adequacy, and drainage. Halton Region Asset Management Plan

16 SAP (Systems Applications and Products) SAP is the world's largest inter-enterprise software company. The original name for SAP was German: Systeme, Anwendungen, Produkte, German for "Systems Applications and Products." SAP is the Halton Region financial system. The Halton Region Tangible Capital Asset registry is maintained in SAP. SCADA (Supervisory Control and Data Acquisition) A computerized system used to control the operation of water and wastewater systems. It is a type of industrial control system (ICS). Industrial control systems are computer-controlled systems that monitor and control industrial processes that exist in the physical world. SCADA systems historically distinguish themselves from other industrial control systems (ICS) by being large-scale processes that can include multiple sites and large distances. These processes include industrial, infrastructure and facility-based processes. Also used to store data such as run times, flows and pressures. Screenline A screenline is an imaginary boundary that defines a broad corridor consisting of one or more roadway links. Smart Commute Halton Smart Commute Halton is a travel demand management program which encourages active and sustainable transportation by offering services and tools designed to make commuting easier for employees of local organizations. Solid Waste Management Strategy A plan with a goal to minimize waste deposited in the landfill which is updated every five years. Spot Repair Program Minor repairs for deficiencies identified in sanitary/wastewater mains. Tangible Capital Asset (TCA) Non-financial assets with physical substance that: 1. are held for use in the production or supply of goods and services, for rental to others, for administrative purposes or for the development, construction, maintenance or repair of other TCA s; 2. have useful economic lives extending beyond an accounting period; 3. are to be used on a continuing basis; and 4. are not for sale in the ordinary course of operations. Halton Region Asset Management Plan

17 The Sustainable Halton Water and Wastewater Master Plan (SHMP) A long-range planning document which integrates infrastructure requirements for existing and future land uses. The plan satisfies at a minimum Phase 1 and 2 of the Municipal Class Environmental Assessment Process. Transportation Master Plan (2031) The Road to Change The Road to Change is Halton Region s current Transportation Master Plan (TMP) which developed a sustainable, integrated transportation plan and associated strategies that consider all modes of travel (automobiles, transit, cycling, walking) to the year Total Suspended Solids (TSS) TSS include all particles suspended in water which will not pass through a filter. Suspended solids are present in sanitary wastewater and many types of industrial wastewater. There are also non-point sources of suspended solids, such as soil erosion from agricultural and construction sites. Transportation Services Progress Report The Transportation Services Progress Report is a report that summarizes the Region s activities relating to the planning, design, construction, operationand maintenance, of the Region s transportation system. Travel Demand Management The application of strategies and policies to reduce travel demand (specifically that of singleoccupancy private vehicles), or to redistribute this demand in space or in time. UK Water Industry Water Resource Council (WRc) Coding Standards Standardized sewer defect coding that has helped to provide a consistent approach in order to deliver confidence in CCTV inspections and data. UNIFORMAT II UNIFORMAT II provides a consistent reference for the description and management of buildings during all phases of their life cycle. The elements identified are the major components, common to most buildings, that usually perform a given function regardless of the design specifications, construction method or materials used. Halton Region Asset Management Plan

18 Watermain Cathodic Protections Method of corrosion protection normally accomplished with the attachment of sacrificial anodes to metallic pipes. Watermain Flushing Process of flushing potable water at a high velocity through watermains in order to remove minor sediment and refresh the water in the main. Watermain Swabbing Method of pipe cleaning accomplished by forcing a sponge through a pipe using water pressure. Wastewater Systems Effluent Regulations (WSER) Environment Canada regulations that state minimum effluent quality standards for four deleterious substances in the effluents of wastewater treatment plants to ensure systems provide at least secondary treatment or the equivalent. Regulations also cover sampling, monitoring, record keeping and reporting requirements. Wastewater System Performance Report An annual report with appendices for each wastewater treatment plant in Halton. It provides a summary of the wastewater treatment system, ensures that Halton is meeting regulatory requirements for testing, and includes analytical, plant flow, bypass, operational and biosolids data. Volume-Demand-to-Capacity Ratio (V/C) The Volume-Demand-to-Capacity Ratio (V/C) is a measure that compares roadway demand (vehicle volumes) with roadway supply (carrying capacity) and determines the level of congestion at an intersection, screenline or corridor. Halton Region Asset Management Plan

19 EXECUTIVE SUMMARY Introduction The Asset Management Plan demonstrates sound stewardship of the Region s existing assets to support services at desired levels and to ensure the support of the Region s infrastructure is financially sustainable. The Asset Management relationships and dependencies at Halton Region are illustrated below. Asset Management Relationships and Dependencies Current State of Assets Level of Service Critical Assets Minimum Life Cycle Costs Long Term Funding Plan Halton Region s infrastructure assets are key resources used to provide services to the public. These services include the provision of a safe and efficient road network, safe drinking water, environmentally sound wastewater treatment, effective waste collection and processing, and the provision of social housing and facilities for other key services such as long-term care. All of these services contribute to the local economy and improve the quality of life for residents. The purpose of Halton Region s Asset Management Plan is to make the best possible decisions regarding the construction, operation, maintenance, renewal, replacement, expansion and disposal of these infrastructure assets while minimizing risk and cost to the Region and its taxpayers and while maximizing service delivery. The Asset Management Plan allows Halton Region to: provide input into long-term infrastructure master plans and the Budget and Business Plan; document existing and planned work practices and procedures; provide a business case for key infrastructure investments to support Regional services; develop a sustainable financial plan; support community engagement regarding customer desired levels of service derived from the infrastructure assets; meet legislative requirements; and support funding applications to the Government of Ontario. Halton Region s vision is to integrate Asset Management with Asset Financial Management as illustrated below. Asset Degradation and Rehabilitation Asset Management Asset Life Cycle Focused Risk Analysis Capacity and Operations Asset Data Status & Condition Asset Needs/ Plans Service Levels Asset Financial Management Financial Sustainability Balanced Budgets Expenditures Leveling Asset Depreciation and Financing Cost of Service Halton Region Asset Management Plan

20 Asset Management Evolution Halton Region has been implementing various Asset Management practices for a number of years. In 2006, a vision for a comprehensive Asset Management program was developed. The vision implementation began with the development of the Regional Tangible Capital Asset register completed in 2009 to comply with new financial reporting requirements (refer to staff reports CS-31-06, CS-45-07, CS-52-07, CS-17-10). In 2012, utilising 2010 data, the Public Works first infrastructure condition report card was presented to Council, (refer to staff report PW-62-12). Subsequently the report card has been updated to reflect 2013 data and is presented in section 3.4 of the Asset Management Plan. The Public Works infrastructure condition report card will be reported on every three years. In 2014, a consultant was retained by the Public Works department to facilitate a review and develop a Corporate Asset Management Framework (Appendix PW18) and implementation plan to begin enhancements to the Public Works Asset Management Plan. Furthermore, the Asset Management Division has been undertaking a Building Condition Assessment process and feasibility study which enhances asset management planning for social housing and corporate facilities assets (refer to staff reports SS-25-08, CS-28-08). The Building Condition Assessments form the basis of the Asset Management Division Report Card which shows that the assets continue to be in a state of good repair. An overview of the evolution of Asset Management for Halton Region is presented in the following timeline. Asset Management Timeline Halton Region Asset Management Vision established CS Public Sector Accounting Board, Tangible Capital Asset Project Update SS and CS Asset Management Building Condition Assessment Proposal CS Financial Statements for Halton Region - including new TCA financial reporting requirements PW Public Works 2010 Infrastructure Condition Report Card CS Capital Asset Management and Reporting Framework CS SAP Software to support Capital Asset Reporting TCA Financial Reporting Compliance Date (Jan. 1, 2009) AM Division Asset Management Plan Development Halton Region Corporate Asset Management Plan The Halton Region Asset Management Plan was developed with an objective to ensure financial sustainability in achieving desired service levels. A project team including staff from the Public Works Department, Legislative and Planning Services Department and the Finance Department, led the initiative, supported by a Steering Committee comprising of Directors from the above named departments. The Asset Management Plan was approved by the Commissioner of Public Works, Commissioner of Finance and Commissioner of Legislative and Planning Services. The first version of the Asset Management Plan was presented to Council through staff report PW-55-13/FN-27-13/ LPS This Asset Management Plan continues to meet the requirements of the Ontario Ministry of Infrastructure Guide for Asset Management Plans issued in August P1 Halton Region Asset Management Plan

21 Asset Management Plan Structure The infrastructure assets currently included in the Halton Region Asset Management Plan are water, wastewater, transportation and waste management assets managed by each of the divisions within the Public Works Department. Corporate Facilities and the Social Housing assets are also included in the plan and are managed by the Asset Management Division of the Legislative and Planning Services Department. The Halton Region Asset Management Plan is divided into two parts: Part 1 - Public Works and Part 2 Corporate Facilities and Social Housing. Although the principles of asset management planning used by both departments are similar, specific policies and practices differ to account for the differences in asset types and their unique operational requirements. Part 1: Public Works Halton Region Asset Management Plan Part 2: Corporate Facilities and Social Housing Halton Region Asset Management Plan The Budget and Business Plan presented for formal Council approval covers a forecast period of 10 years. However, the Asset Management Plan provides a full asset life cycle analysis for up to 100 years for Public Works assets. For Corporate Facilities and Social Housing assets, Building Condition Assessment and feasibility studies and replacement cost estimates are prepared for a forecast period of 25 years. Asset Management Plan Updates Continuous improvements to Asset Management practices within Halton Region will result in updates to the Asset Management Plan, and as such, it is a living document that will require ongoing refinement to reflect the evolution of Asset Management maturing within Halton Region over time. Next steps include scoping and validating a roadmap of activities which will enhance the Public Works Asset Management Plan as detailed in Appendix PW1. Annual updates to this Asset Management Plan will be prepared on the same timeline as the Region s Budget and Business Plan. Asset Management Plan Summary 1. State of Local Infrastructure Public Works infrastructure includes transportation, water, wastewater and waste management assets. The total book value of these assets at December 31, 2013 was $3.0 billion. The total estimated replacement value in current dollars is $8 billion. This figure does not account for technological advancements and changes to legislative requirements; therefore, the actual current replacement value is expected to be higher in the year the asset is needed to be replaced (refer to Appendix PW2 for details). Most of those assets are assessed to be in good condition, (refer to Infrastructure Condition Report Card section 3.4). Asset information is compiled in accordance with Regional policies and procedures and is stored in the Region s accounting system and individual asset records. This asset information is also included in the annual financial statements which are subject to external audit. Halton Region Asset Management Plan

22 Halton Region s transportation infrastructure includes: 1,013 lane kilometres of Regional roads 225 bridges and major culverts Water infrastructure includes: 7 bulk water stations 12 water treatment plants (3 lake & 9 ground water based) 19 municipal wells 2,218 kilometers of watermains 22 reservoirs 15 booster stations Wastewater infrastructure includes: 7 wastewater treatment plants 1,806 kms of wastewater mains 1 biosolids facility 88 pumping stations Waste management infrastructure includes: 1 open landfill 11 closed landfills and leachate pumping stations The Asset Management Division s Asset Management Plan covers all corporate facility and social housing assets totaling over 3.2 million square feet. The book value of owned Corporate Facilities as of December 31, 2013 was $75 million with a current replacement cost estimate of $175 million. (i) The book value of owned Social Housing assets as at December 31, 2013 was $93 million with a current replacement cost estimate of $266 million. These estimates are stated in current dollars and are based on insurance values, (refer to Appendix AM10 for details). These estimates do not take into account other cost factors such as technology advancements, (i) Includes Police portion of Halton Regional Centre and as such the replacement value is expected to be higher in the year the asset needs to be replaced. The condition of these assets is evaluated on an annual basis during the development of the capital and operating budgets and through Building Condition Assessments performed on a five-year rotating cycle. Most of the assets are assessed to be in good condition, (refer to Appendix AM2). Asset information is compiled in accordance with Regional policies and procedures and is stored in the Region s accounting system, individual property Building Condition Assessment records and the capital asset management software. Owned Corporate Facilities: Halton Regional Centre 3 Long-term Care Facilities 8 Halton Region Paramedic Services Facilities Halton Museum Woodlands Operations Centre (South Operations) North Operations Centre Halton Waste Management Building Facilities 3 Child Care Centres Social Housing: Halton Community Housing Corporation buildings (including a child care facility) Oakville Senior Citizens Residence 2,300 units (in 13 Senior Communities & 19 family Communities) Assets managed by the Asset Management Division: Land Banks Leased Facilities, including one child care centre owned by HCHC 4 First Line Properties (part of Public Works infrastructure assets) Halton Region Asset Management Plan

23 2. Levels of Service Levels of service are a key business driver for Halton Region and influence all asset management decisions. Levels of service statements describe the outputs Halton intends to deliver to its customers and commonly relate to service attributes such as quality, reliability, responsiveness, sustainability, timeliness, accessibility and cost. Halton s levels of service can relate to technical and legislated requirements, as well as Council directives. Council directives are influenced by the Citizens Priorities, Action Plan. P2 Other factors that influence levels of service include condition assessments, client needs and requests. To demonstrate that Halton Region is delivering on the priorities outlined in the Citizens Action Plan, detailed infrastructure master plans and the Budget and Business Plan support the initiatives listed in the Citizens Priorities Action Plan. To maintain transparency, a report card showing progress of the listed initiatives in the action plan is presented to Council annually. The first report card was issued in P3 Desired levels of service are based on technical, legislated and customer requirements approved by Council. Levels of service for the Public Works infrastructure relate to the delivery of service through the following: Transportation - Plan, construct and maintain a regional transportation system that includes 1,013 lane kilometres of major arterial roadways, signalized intersections, lighting, signs, 225 bridges and major structures. Water and Wastewater Infrastructure - Plan, construct and maintain a complex and integrated system of physical structures to deliver drinking water to Halton residents and dispose of wastewater in an efficient and sustainable manner. Environmental Protection and Conservation of Water - Protect water quality and the natural environment through effective treatment, source protection, conservation and adherence to regulations. Waste Management - Plan and implement an integrated and sustainable waste management system of collecting, processing and disposing municipal solid waste that incorporates the principles of reduce, reuse, recycle and resource recovery. A number of external trends and impacts are considered when reviewing levels of service including provincial legislation such as the Places to Grow Act, 2005 and changing weather patterns that affect storm occurrence inflow and infiltration rates. Water use patterns through conservation programs are factored in when planning for infrastructure and its funding. Waste diversion programs result in extending the remaining life of the landfill. Public Works measures levels of service through a number of tools and reporting mechanisms. These include Council reports such as the annual Transportation Services Progress Report documenting roadway infrastructure and the Wastewater System Performance Report. The Drinking Water Systems Flow Summary Report provides information relating to compliance. Additionally, Public Works has produced an overall Infrastructure Condition Report Card. Performance details are tracked internally using various information systems and tools. Halton Region Asset Management Plan

24 Levels of service for the Asset Management Division are based upon the review of the long range infrastructure strategies, current technical and financial practices. The Asset Management Division takes a comprehensive long-term view of its infrastructure performance and costs and has several procedures and processes in place to ensure that asset performance is monitored to ensure that legislative requirements are met. External issues and trends such as changing legislative requirements are reviewed on a regular basis to ensure the levels of service are updated where required. 3. Asset Management Strategy An effective asset management strategy requires knowledge of the condition of the assets, the performance of the assets as compared to desired levels of service and the associated costs to maintain, rehabilitate, replace and expand the asset systems and components. Knowledge of disposal costs is also required. This section of the Asset Management Plan details the various components to ensure that actions are taken to enable assets to provide the desired levels of service in a sustainable way while managing risk at the lowest life cycle cost possible. The Asset Management Strategy at Halton Region is: Customer focused Clearly-defined levels of service and applied asset management practices to provide those levels of service and maintain the confidence of program areas and customers in how Regional assets are managed. Forward-looking Make appropriate decisions and provisions to enable assets to meet future challenges, including changing demographics and populations, program area expectations, legislative requirements, technological, and environmental factors. Integrated and service-coordinated Consider all the assets in a service context and take into account their interrelationships as opposed to optimizing individual assets in isolation. Risk-based Manage the asset risk associated with attaining the agreed levels of service by focusing resources, expenditures, and priorities based upon risk assessments and the corresponding cost/benefit recognizing that public safety is the priority. Value-based/Affordable Choose practices, interventions and operations that aim at reducing the life cycle cost of asset ownership, while satisfying agreed levels of service. Decisions are based on balancing service levels, risks and costs. Holistic Take a comprehensive approach that looks at the big picture and considers the combined impact of managing all aspects of the asset life cycle including direct and indirect impacts of the asset. Halton Region Asset Management Plan

25 Systematic Adopt a formal, consistent, replicable approach to the management of assets that will ensure services are provided in the most efficient and effective manner. Innovative Continually improve the asset management approach by driving innovation in the development of tools, practices and solutions. In order to enhance infrastructure and financial sustainability planning, Public Works also reviews the long-term infrastructure life cycles, (refer to Appendix PW3). The divisions of the Public Works department have policies and processes in place for producing a tactical one-year budget as well as a 10-year Capital Plan forecast, (refer to Appendix PW4 and PW15). The process culminates in the production of an annual Budget and Business Plan. Public Works undertakes a number of programs, studies, condition assessments and maintenance reports which may identify specific projects that include but are not limited to: roadway crack sealing, roadway resurfacing, roadway replacements and expansions, watermain cathodic protection, watermain and wastewater main replacements, and expansions and facility refurbishments, upgrades and expansions. To ensure that infrastructure is maintained in a state of good repair and provides desired levels of service at the lowest possible life cycle cost, Public Works continuously develops and implements a number of non-infrastructure solutions. These include but are not limited to: travel demand management, smart commute initiatives, the water efficiency outreach program, the optimization program for linear assets and treatment plants, annual wastewater main flushing program, waste diversion programs and the coordination of water, wastewater, transportation and Local Municipality construction projects. Additionally, maintenance activities are carried out on a regular basis. Each division also performs renewal and rehabilitation activities. Replacements and asset expansions required are mainly identified through the maintenance, renewal and rehabilitation activities. All Public Works divisions follow the Region s policy for asset disposal. Risks relating to the Asset Management Strategy are evaluated on a regular basis. Through studies and condition assessments, different options are considered. The options analysis includes items such as: life cycle cost analysis, direct and indirect benefits and costs. Halton Region Asset Management Plan

26 Asset information and desired levels of service form the basis of the Asset Management Strategy for the Asset Management Division. The Asset Management Strategy includes a review of options using a life cycle cost analysis and risk assessments to appropriately prioritize projects and to develop project plans. The Building Condition Assessments are a crucial cornerstone of information that forms the basis of the plan. The Asset Management Division incorporates existing preventative maintenance and risk management programs to preclude the risk of failure. The preventative maintenance components ensure that the asset meets or exceeds its expected life cycle. The risk management component ensures that administration manages the risk through due diligence. Maintenance activities of the assets are carried out on a regular basis. From these ongoing efforts information is gathered that supports the overall lifecycle program and its eventual replacement. The Asset Management Division also follows the Region s policy on for asset disposal. Through the management of the assets by current level maintenance activities as well as studies and condition assessments, the Asset Management Division develops lifecycle forecasting options. Each year, the 10-year forecast for the Operating Budget is updated to reflect the changing needs to operate and maintain infrastructure and to incorporate the impact of additional infrastructure included in the Capital Budget (i.e. growth related infrastructure). Key sources of revenue for the Operating Budget include tax revenue and user fees. The estimated forecasted capital expenditures and financing sources for Public Works based on the 2014 Budget and Business Plan are presented in the following graphs: PW Total Capital Expenditures: $2.8B Water 32% Transportation 44% Wastewater 22% Waste Management 2% 4. Financing Strategy The annual Budget and Business Plan is compiled by the Financial Planning and Budgets division working with each of the program areas. For the state of good repair Capital Budget, a 10-year forecast of proposed projects representing asset rehabilitation and replacements is reviewed taking into consideration program needs, trends and priorities. Once the budget request is finalized, financing options are determined based on the optimum funding plan including the following key sources of funding: debt, reserves, grants/recoveries, and development charges (for asset replacement of assets involving growth related infrastructure). The financing of the capital plan is determined using provincial and Halton Region guidelines and policies relating to debt capacity and provisions to fund capital reserves and future infrastructure needs. The capital reserves are then replenished by the operating budget contributions based on a financial plan. Non-capital expenditures such as repairs and maintenance are part of the Operating Budget. Reserves 50% PW Capital Financing: $2.8B Development Charges 44% Subsidies & Recoveries 1% Debentures (Debt) 5% Halton Region Asset Management Plan

27 The estimated, forecasted capital expenditures and financing sources for each of the programs based on the 2014 Budget and Business Plan are presented in the graph below: Asset Management Capital Program Expenditures: $106M Social Housing 47% Corporate 53% The forecasted total net operating expenditures, of $1.7 billion between 2014 and 2023 include maintenance but exclude capital financing for the Public Works department based on the 2014 Budget and Business Plan. For the Corporate and Social Housing infrastructure, the Asset Management Strategy sets out planned actions to enable assets to provide the desired levels of service in a sustainable way while managing risk at the lowest life cycle cost possible. Once the Asset Management Strategy is developed, the financing strategy to fund the proposed projects is prepared using a minimum time horizon of 10 years. Project cost details, what if scenarios, actual cost comparisons, costs associated with maintenance of the assets, energy usage, and sustainability assumptions are used. Project costs developed are reviewed along with available funding sources to ensure sufficient funding is available to meet legislated requirements as well as desired levels of service. Key funding sources include reserves and tax revenue. The detailed Asset Management Divison capital budget forms part of the Region s Budget and Business Plan. Halton Region Asset Management Plan

28 Conclusion Halton Region Asset Management practices have resulted in assets meeting desired levels of service and being maintained in a state-of-good-repair as illustrated in the Public Works 2013 Infrastructure Condition Report Card and the Corporate and Social Housing Assets 2013 Infrastructure Condition Report Card developed as part of the Building Condition Assessment process. Although the majority of assets are rated to be in good condition, there are individual assets that fall within the fair and poor categories. Utilizing a strategic prioritization process, these assets will be addressed through the annual Capital Budget. As stated in the 2015 Budget Directions (staff report FN-26-14), the state-of-goodrepair budget continues to be the key driver for budget increases due to increasing infrastructure needs. For example, capital financing for the water and wastewater state-of-good-repair program will continue to increase by 9.3 per cent for Funding needs will continue to be assessed to determine sustainable funding levels that meet the desired levels of service and identified infrastructure needs due to aging and expanding infrastructure. This will continue to be performed through the development of a financing plan to align resources to the defined need. The Asset Management Plan ensures the best decisions are made regarding the construction, maintenance, renewal, replacement, expansion and disposal of infrastructure assets. The science of balancing risks, levels of service and optimizing utilization is the essence of Asset Management and will be the focus of future continuous improvement initiatives. The ultimate goal is to have a long-term financially sustainable Asset Management Plan that integrates Asset Management with Asset Financial Management. Halton Region Asset Management Plan

29 Part 1: Public Works Halton Region Asset Management Plan

30 2 INTRODUCTION The Public Works (PW) Department currently contains five divisions which are structured based on the programs and services they provide. The divisions are: Water Services, Wastewater Services, Waste Management Services, Transportation Services, and the Business and Technical Services support division. 2.1 Asset Management Plan Purpose The purpose of the PW Asset Management Plan (AMP) is to make the best possible decisions regarding the planning, construction, operation, maintenance, renewal, replacement, expansion and disposal of PW infrastructure assets while minimizing risk and cost to the Region and its taxpayers while maximizing service delivery. The AMP is based on corporate objectives and priorities and is linked to documents such as the Transportation Master Plan and desired levels of service (LOS). The AMP forms the basis for the Region s annual Budget and Business Plan. 2.2 Assets Included in the Plan The PW section of Halton s AMP covers all major infrastructure including transportation, water, wastewater and waste management assets. These infrastructure assets are key resources used to provide services to the public. These services include the provision of a safe and effective road network, safe drinking water, wastewater treatment, waste collection and processing. Refer to the next page for details of PW infrastructure assets. Halton Region Asset Management Plan

31 The following PW infrastructure assets are covered in the plan: Water: 2,218 km of watermains 12 water treatment plants (3 lake & 9 ground water based) 19 municipal wells 15 booster stations 22 reservoirs 7 bulk water stations Wastewater: 1,806 km of wastewater mains 7 wastewater treatment plants 88 pumping stations 1 biosolids facility Transportation: 1013 lane kilometres of Regional roads 225 bridges and major culverts signalised intersections guiderails retaining walls noise walls streetlights Waste Management: one open landfill 11 closed landfills leachate pumping stations Halton Region Asset Management Plan

32 2.3 Asset Management Plan Development and Timeline The PW section of the AMP was developed internally. The Financing Strategy was developed working with the Financial Planning and Budgets Division. The plan includes a tactical one-year budget and a 10-year forecast which is included in the Region s Budget and Business Plan. P4 In 2014, the 20-year state-of-good repair capital needs for water and wasterwater infrastructure were reviewed. This review was leveraged in the development of the proposed 2015 Capital Budget for In 2014 GM BluePlan was retained by the Public Works department to facilitate the development of an asset management framework for a comprehensive asset management program. The asset management framework (refer to Appendix PW18) has been approved by the Steering Committee and will be followed by an implementation plan to enhance Halton Region s current practices in order to deliver a comprehensive asset management program. Implementation of the plan will begin in 2015 and is expected to be completed over the next four years. Enhancements will include processes and policies for levels of service, risk and condition assessments, performance targets and maintenance among other items. Additionally, 100-year life cycle charts have been included to illustrate life cycles for long-lived infrastructure (refer to Appendix PW3). 2.4 Asset Management Plan Updates The AMP is a living document that will continue to reflect the evolution of asset management within Halton Region. It is intended that continuous improvements to asset management practices within Halton Region will result in updates to this AMP. A roadmap including specific items to be addressed over the next five years is included in Appendix PW1. 3 State of Local Infrastructure 3.1 Asset Types Halton Region s PW infrastructure includes an integrated transportation network of roads and bridges, storm water management assets, water purification and distribution assets, wastewater (sewage) collection and treatment assets, and waste management (garbage) collection, disposal and recycling assets. (Refer to Section 2 Introduction for additional details.) Policies and procedures relating to the classification of asset types were developed as part of a project ( Tangible Capital Asset Project Council Reports CS-31-06, CS-52-07, CS and CS-17-10) to meet the requirements of the financial accounting standard PS 3150 Tangible Capital Assets (TCA) as prescribed by the Public Sector Accounting Board (PSAB). The asset types are outlined in the TCA Guidance for each program area which can be found on the Halton Region internal website P6. (Samples of the guidance are included in Appendix PW5.) Halton Region Asset Management Plan

33 3.2 Asset Valuation Financial accounting valuation uses historical costs and depreciation assumptions to determine the book value of capital assets in accordance with PSAB. The total book value of PW infrastructure at December 31, 2013 was $3.0 billion (Appendix PW2). Policies and procedures relating to the development of book values for accounting purposes were developed as part of the TCA Project. In summary, actual costs were used to record assets acquired in 2008 and later or for assets acquired prior to 2008 where relating documentation was available. For assets acquired prior to 2008, where documents were not available, historical costs were calculated through the regression of current replacement costs to year of construction using an appropriate price index. Replacement cost valuation is forward-looking and accounts for changes in technology and other factors such as inflation. The Halton PW infrastructure is estimated at a current replacement cost of $8.4 billion (Appendix PW2). The replacement values were calculated using historical costs indexed to December 31, 2013 using the Non-Residential Building Construction Price Indices (NRBCPI); therefore, the PW replacement cost valuation is presented in current dollars and does not account for technology improvements. As such, the actual current replacement cost for PW infrastructure is expected to be higher than $8.4 billion. Water, wastewater, roadway and bridge infrastructure represent the largest portion of the asset base. 3.3 Asset Age Distribution Details relating to the asset age distribution are maintained in the Region s accounting system, SAP. As part of annual reporting on the Citizens Priorities, Halton s PW department reports on the remaining useful life of its linear water and wastewater infrastructure as illustrated in Appendix PW6. Currently, the average remaining useful life for water and wastewater linear infrastructure is at a positive rate of 74 per cent compared to the target rate of 50 per cent (2012 figures). 3.4 Asset Condition Asset condition is reviewed and analyzed on an ongoing basis. Details relating to the condition of each asset are maintained in Excel spreadsheets. In 2012, the PW department presented the 2010 Infrastructure Condition Report Card to Council (staff report PW P7 ) to illustrate the overall condition of its assets. The report card is being prepared on a three year cycle. The updated 2013 infrastructure condition report card is presented next. Halton Region Asset Management Plan

34 Halton Region is making a significant commitment to infrastructure improvements through its Building a Better Halton infrastructure improvement program. Whether it s reducing commute times or providing residents with clean, safe drinking water, maintaining and improving Regional public works infrastructure touches the life of every resident and business across Halton. In order to continue Building a Better Halton through ongoing investments to transportation, water, waste and wastewater infrastructure, it s critical to know the current state of Regional public works infrastructure. *This is the estimated current value of existing infrastructure. Current values are represented in today s dollars (as of 2013) based on the Non-Residential Contruction Price Index (NRBCPI). Does not represent replacement cost. Halton Region Asset Management Plan

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38 Halton Region Asset Management Plan

39 3.5 Asset Inventory Database Halton Region developed an integrated asset data inventory as part of the previously referenced TCA Project. All Halton Region asset data is stored and accounted for in the SAP financial system. This is achieved through a RIVA interface, which is directly synchronized to the asset management applications. The asset attributes include: Name Description Location Size Date of Construction Project or Development Number and Material Type Refer to Appendix PW7 for a typical asset record. Appendix PW8 is an architectural representation of the asset registry applications. 3.6 Assumptions Assumptions used in the development of asset values and condition assessments are documented in the Halton Region TCA policies and procedures as well as various TCA project records. Inventory database maintenance processes and procedures are also documented. TCA guidance documents are kept on the internal website and secure drives P8, P9, P Data Verification and Condition Assessment Policy Halton Region has well-developed policies, procedures and guidelines for sustainability of the TCA asset information as outlined above. Additionally, a sustainable, auditable and replicable process was developed and documented as part of the development of the Infrastructure Condition Report Card. This documentation included all the data sources and any assumptions that were used P11, P12. Halton Region Asset Management Plan

40 4 Desired Levels of Service (LOS) LOS are a key business driver and influence all asset management decisions. LOS statements describe the outputs Halton intends to deliver to its residents and commonly relate to service attributes such as quality, capacity, reliability, responsiveness, sustainability, timeliness, accessibility and cost. Halton s customer LOS will be highlighted for each service area in the coming subsections. It should be noted that each service area also has technical and legislated LOS that are specific to the type and nature of the program infrastructure. PW meets or exceeds legislated and technical LOS for each of the service areas. This includes meeting maintenance standards for the roadway and bridge structures, the Safe Drinking Water Act, 2002, Environmental Protection Act and Ontario Water Resources Act for wastewater, and Ministry of the Environment (MOE) legislated requirements for open landfills. The PW Department is committed to excellence in public service through: engaged employees, visionary leadership, excellent customer service, community trust, and continuous improvements. The Building a Better Halton infrastructure communications strategy was launched to promote two-way communication between Halton Region and the community. The strategy includes a dedicated look, construction signage, webbased information at and consistent, frequent information updates to residents. Feedback gathered from residents is used to continuously evaluate the LOS. 4.1 Defined Levels of Service LOS for the PW department are based on the following: technical requirements legislated requirements customer requirements Transportation The Region s Official Plan, through Section 173(19) of ROPA 38, requires staff to monitor the overall performance of Halton s Transportation System and to report annually to Council through Halton Region Asset Management Plan

41 the Transportation Services Progress Report P13 on the Region s activities relating to the planning, design, construction, operation and maintenance of the Region s transportation system. Key system performance indicators provided in the report enable the overall state of the Regional road system to be tracked and measured over time. Annual programs are undertaken to ensure that regional roads are operating in the safest and most efficient way possible, and that the service life of infrastructure is optimized. The following detailed LOS are defined for the Transportation Division. a) Technical LOS (i) Road Capacity The need for additional road capacity is determined by comparing the evening (PM) peak-hour traffic volume at the screenline level versus the available capacity. Capacity deficiencies are determined based on achieving a target through the volume/capacity (v/c) ratio. At a v/c ratio of 0.90, the transportation network crossing the screenline is operating at 90 per cent of its functional capacity. For screenlines that exceed a v/c ratio of 0.90, the construction of additional lanes is considered to provide sufficient additional capacity to return the screenline to 90 per cent of its capacity. The current Transportation Master Plan (2031) The Road to Change used this methodology to determine the preferred roadway solutions to accommodate travel demand growth in the Region to 2031 as outlined in Section 5 of the report P14. (ii) Pavement Management The pavement condition within the Regional road system is monitored through Pavement Management Data Collection and Review performed on a three-year cycle. The pavement data is used to measure how well the road network is performing through Pavement Condition Indices (Surface Distress, Ride Comfort and Pavement Quality). The monitoring program provides consistent and accurate condition information that allows for timely and optimized preservation, upgrading and replacement of pavement infrastructure. The objective is to maintain an overall network average PQI at a level of 7 out of 10 or good. (iii) Road Needs Study The Road Needs Study is prepared annually to provide an overview of the condition of the road sections comprising the Regional network, and uses the Ministry of Transportation Inventory Manual for Municipal Roads methodology to consider factors such as capacity, geometry, surface width, surface type, structural adequacy, and drainage. Refer to Appendix PW9 for a roadway appraisal sheet. Halton Region Asset Management Plan

42 The scoring from the study provides overall system adequacy and time of need per road section, which is used to evaluate the adequacy of the entire network P15. The objective is to maintain overall road system adequacy of 75 per cent as a minimum based on lane kilometres. (iv) PW 2013 Infrastructure Condition Report Card The first PW infrastructure condition report card on the state of infrastructure in Transportation and PW as a whole was presented to Council through Report PW and reflected 2010 data. The report has been updated to reflect 2013 data and the intent is to update it every 3 years. This report identified areas requiring further investigation to improve service levels. The 2013 report card is included in Section 3.4 of this document. b) Legislated LOS (i) Road Maintenance Halton Region has adopted a Road Maintenance LOS P16 that defines the activities to be carried out as part of the maintenance of the Region s road infrastructure to ensure safety, preservation and quality of life, and establishes the timeframes within which those activities will be completed. The Road Maintenance LOS meets the Ontario Regulation 239/02 Minimum Standards for Municipal Highways (MMSMH) P17. Regional road maintenance in Halton is primarily performed through maintenance agreements with the Region s lower-tier municipalities to performance standards outlined in the Contractors Maintenance Services document. (ii) Bridges and Major Structures Biannual structure inspections are performed on all bridges and major structures in accordance with Ontario Regulation 104/97 Standards for Bridges P18 to ensure structures are kept safe and in good repair. Refer to Appendix PW10 for a structure inspection form. c) Customer LOS (i) Council Directives based on Citizens Priorities Work to respond to technical and legislated levels of service is supplemented by priority projects and activities identified by Regional Council based on the Citizens Priorities Action Plan. Halton Region Asset Management Plan

43 Water The following detailed LOS are defined for the Water Division. a) Technical LOS (i) The Sustainable Halton Water and Wastewater Master Plan Section 6 P19 (SHMP) This is a planning document which follows the Municipal Class Environmental Assessment process. At five-year intervals, the Master Plan identifies system capacities and compares them to projected needs for a specified planning horizon. In addition, it identifies target pressures, unit demand rates, peaking factors, minimum fire flows, storage requirements and production and pumping rates for water which are used to establish a list of growth-related capital projects that are required to deliver the future service needs. (Appendix 1.5 Policy Paper of the SHMP includes a number of statements related to the provision of water services and the implications of each statement as it relates to the design of the system. The Design Criteria, Appendix 1.6 of the SHMP provides an executive summary of the design criteria as well as additional context). (ii) Condition Assessment Reports Consulting firms are retained by Halton Region to assess the condition of the water treatment plants, reservoirs, booster stations and municipal wells. The assessments typically include structural, process, building, HVAC, and site reviews. The reports will recommend maintenance or capital projects with timing and cost estimates and these assessments are typically performed every five years. (iii) Halton Design Criteria Technical criteria and design standards for the provision of water services (pressures, quantities, fire flows, sizing materials, etc.). This criteria aligns with the MOE Design Guidelines for Drinking Water Systems, (iv) Capital Budget Targets Identify work required to maintain infrastructure in a state of good repair. Capital budget requirements are gathered through annual review of fire flow test break Halton Region Asset Management Plan

44 records and other performance indicators, along with capital need assessment study findings. This results in the creation of projects for placement in the annual Capital Budget. (v) Preventative Maintenance Program Program to inspect, maintain and identify needs for asset maintenance, renewal or replacement prior to actual failure. This method ensures water quality is maintained and proactively identifies potential problems in the existing system. For example, watermain flushing ensures water quality within the system by monitoring residuals and proactively refreshing water and removing sediment. The program includes but is not limited to the following: valve preventative maintenance hydrant preventative maintenance watermain flushing program watermain swabbing program leak detection program (vi) Water Efficiency Program Program in the community to promote the reduction of water use through education and the use of water efficient fixtures. The program includes but is not limited to the following: Toilet Rebate Program Outdoor Water Use education Indoor Water Efficiency Household Guide to Water Efficiency Rain Barrel Sales (v) PW 2013 Infrastructure Condition Report Card (Refer to Transportation subsection.) b) Legislated LOS (i) Source Water Protection, Clean Water Act Ontario's Clean Water Act helps to protect drinking water from source to tap with a Halton Region Asset Management Plan

45 multi-barrier approach that stops contaminants from entering sources of municipal drinking water - lakes, rivers and aquifers. Ontario's Clean Water Act: requires that local residents, businesses and municipalities - through local Source Protection Committees - assess existing and potential threats to their municipal water sources, and that they set out and implement the actions needed to reduce or eliminate these threats empowers communities to take action to prevent threats from becoming significant requires public participation on every local source protection plan - the planning process for source protection is open to anyone in the community requires that all plans and actions are based on sound science. (ii) Safe Water Drinking Act, 2002 The purpose of the Safe Drinking Water Act is to protect human health through the control and regulation of drinking-water systems and drinking-water testing. Building on existing policy and practice in Ontario's treatment and distribution of drinking water, the Safe Drinking Water Act requires that all municipal drinking water systems obtain an approval from the Director of the Ministry of the Environment in order to operate. Operators are required to be trained and certified to provincial standards. The act also provides legally binding standards for testing of drinking water and requires that testing be done in licensed and accredited laboratories. (iii) Municipal Drinking Water License To be a water purveyor, a provincial licence is required under the municipal drinking water licensing program. The licensing program replaced the Certificates of Approval program for municipal residential drinking water systems. In order to receive a Municipal Drinking Water License from the province, a municipality must have the following in place. Drinking Water Works Permit Permit to Take Water Approved Operational Plan Be an Accredited Operating Authority Financial Plan Halton Region Asset Management Plan

46 All of Halton s municipal water systems are fully licensed under the MOE. The licenses detail how to operate each water system including general conditions and rated capacity. The drinking water works permit lists system components, details how modifications can be made to the system, and details system-specific conditions. These documents must be renewed on a five-year cycle and are amended from time to time, as required, mainly due to significant system alterations or new conditions. (iv) Drinking Water Systems Flow Summary Report A summary of flows and description of any failures to meet requirements of the act or regulations. Also identifies a summary of Provincial legislation significant to water operations and lists annual reports required by legislation or regulation. (v) Annual Water Quality Report Includes water quality test results along with corrective action for adverse test results. (vi) Drinking Water Quality Management Systems (DWQMS) DWQMS is a repository of information for Halton s drinking water system and all related business processes. It contains all PW procedures, policies, manuals, instructions, specifications and forms related to operation of the water infrastructure. It also contains the Operational Plan as required by the Drinking Water Licence. c) Customer LOS (i) Council Directives based on Citizens Priorities (Refer to Transporation subsection) Wastewater The following detailed LOS are defined for the Wastewater Division. a) Technical LOS (i) The Sustainable Halton Water and Wastewater Master Plan Section 6 P19 (SHMP) Identifies target pressures, unit demand rates, peaking factors, existing and future pumping rates for wastewater which are used to establish lists of growth- Halton Region Asset Management Plan

47 related projects. The new flows are modeled and existing capacity is reviewed. For wastewater linear assets, if the projected flow of a sewer is greater than 85 per cent (industry practice); the sewer main will be identified for upsizing. (Also see the Water subsection). (ii) Condition Assessment Reports Consulting firms are retained by Halton Region to assess the condition of the wastewater treatment plants and pumping stations. The assessments typically include structural, process, building, HVAC, and site reviews. The reports will recommend maintenance or capital projects with timing and cost estimates and these assessments are typically performed every five years. (iii) CCTV Inspection of Linear Assets Halton Region has a CCTV inspection program for mainline sewers that assesses the condition and scores each asset. In October 2013, Halton transferred over to the new Pipeline Assessment and Certification Program (PACP) industry coding standards, which generate a score between 1 and 5, where 1 is considered new and 5 indicates that work is required for a sewer right away. If a main has a high score of 3 or 4, a project is identified to replace the sewer in the 10-year Capital Budget. If a sewer scores a 5 or is found to be in need of immediate replacement, the main is fixed through the spot repair program. Currently, the wastewater mains in Halton Region are inspected on a cycle of one in every 20 years. (iv) Manhole Inspection Program An outside consultant is hired to perform a condition assessment on a predetermined number of manholes. All manholes are inspected and scored based on Manhole Assessment and Certification Program (MACP) industry standards. Any manholes identified with deficiencies are repaired or replaced as needed. All manholes that score a MACP score of 5 (worst rating) are addressed immediately. (v) Preventative Maintenance Program The Preventative Maintenance Program is performed as recommended by the original equipment manufacturer (OEM). (vi) Annual Maintenance Flushing Program Halton s standards require plastic pipes to be flushed every four years and non-plastic pipes every two years. Halton Region Asset Management Plan

48 (vii) (viii) (ix) Flushing of Identified Linear Trouble Sections Halton has a two-month and a six-month flushing program for identified trouble sections of sewers within the collection system. The flushing removes debris, grit, grease and other items to ensure the sewer main capacity isn t compromised. Capital Budget Targets (Refer to Water subsection.) PW 2013 Infrastructure Condition Report Card (Refer to Transportation subsection.) b) Legislated LOS (i) Environmental Compliance Approvals (ECAs) Include regulations mandated by the MOE on emission levels of air and discharges from wastewater treatment facilitates. The list of effluent parameters, along with compliance limits, performance objectives, monitoring and reporting requirements, are all detailed in the ECA for each treatment plant. (ii) Preventative Maintenance Program Inspection, testing and calibration of electrical, mechanical, instrumentation, and control equipment is performed and documented by fully-trained and qualified technicians. c) Customer LOS (i) Council Directives based on Citizens Priorities (Refer to Transporation subsection) Waste Management The following detailed LOS are defined for the Waste Management Division. a) Technical LOS (i) Waste Diversion Halton has implemented an increase in diversion from the Halton Waste Management Site as per the Solid Waste Management Strategy, staff report PW Halton Region Asset Management Plan

49 The current target is 65 per cent diversion by 2016 through a number of programs. Most diversion programs will extend the service life of the asset. (ii) PW 2013 Infrastructure Condition Report Card (Refer to Transportation subsection.) b) Legislated LOS (i) Certificate of Approval Desired LOS are prescribed to meet or exceed the Certificate of Approval from the MOE. The Region typically exceeds these requirements. c) Customer LOS (i) Council Directives based on Citizens Priorities (Refer to Transporation subsection) 4.2 External Trends and Issues External trends and issues affecting expected LOS or the Region s ability to meet the desired LOS include the following. Transportation Ontario Regulation 413/12 under the Accessibility for Ontarians with Disabilities (AODA) Act, 2005 P20 The Big Move P21, Metrolinx, The Regional Transportation Plan Region s Official Plan (ROPA38) P22 Provincial legislation such as Places to Grow Act, 2005 and the Greenbelt Plan. Population and employment forecasts which will impact infrastructure use. Minimum Maintenance Standards Regulation 239/02. Water Sustainable Halton Water and Wastewater Master Plan including factors such as climate change, growth and regulatory changes. DWQMS P23 Source Water Protection Act Local municipal bylaws Halton Region Asset Management Plan

50 External funding available which may affect the projects undertaken. LOS may be affected if the rate of aging infrastructure is higher than the rehabilitation and replacement program funding available. Infrastructure failing prematurely due to environmental factors and construction practices requiring repair or replacement much earlier than the expected life of the asset. Water use patterns such as conservation which negatively affect rate revenue. Population forecasts which will impact asset use Provincial legislation such as Places to Grow Act, Wastewater Sustainable Halton Water and Wastewater Master Plan including factors such as growth and regulatory changes. Changing regulations governing wastewater such as Wastewater Systems Effluent Regulations (WSER) and local municipal bylaws Climate change; changing storm events and patterns. Higher frequency storms occurring more regularly impact the increased inflow and infiltration (I/I) entering the collection system. External funding available which may affect the projects undertaken. LOS may be affected if the rate of aging infrastructure is higher than the rehabilitation and replacement program funding available. Infrastructure failing prematurely due to environmental factors construction practices thus requiring repair or replacement much earlier than the expected life of the asset. Water use patterns such as conservation which negatively affect rate revenue. Low-flush toilets and other water conservation fixtures are impacting the wastewater treatment plants as wastewater entering the plants is more concentrated. Population forecasts which will impact asset use. Provincial legislation such as Places to Grow Act, Waste Management Expected population growth projections to 2045 which may impact future diversion targets. Public demand for diversion programs which may extend the useful life of the landfill. Landfill disposal public concerns. Changes in Provincial legislation o Landfill standards o Waste Diversion Act Halton Region Asset Management Plan

51 4.3 Performance Measurement This section explains how PW tracks current performance of assets relative to expected targets. Transportation The Transportation division tracks current performance of assets using the following measures. Pavement Quality Index (PQI) - Pavement Management System [Road Matrix] Bridge Condition Index (BCI) Structures Inventory Road Needs Study (System Adequacy) Performance Management Programs a) Average BCI (Bridge and Culvert condition assessed as good to very good) b) Municipal Performance Management Program (MPMP) which includes provincewide efficiency and effectiveness metrics and reporting to promote transparency and accountability related to municipal service levels. P24 (Bridge and Culvert condition assessed as good to very good and Pavement Condition where it is assessed as good to very good.) PW 2013 Infrastructure Condition Report Card (refer to Section 3.4 for the most recent report). Water The Water division tracks asset performance using the following measures. Drinking Water Systems Flow P23 Summary Report provides a summary of flows and descriptions of any failures to meet requirements of the Safe Drinking Water Act, 2002 or other regulations. Annual Water Quality Report gives water quality test results along with corrective action for adverse test results. Permit to Take Water Annual Report gives conditions set out in individual permits to take water. Participation in the National Water and Wastewater Benchmarking Initiative P25. Municipal Performance Measurement Program (MPMP) which includes province-wide efficiency and effectiveness metrics and reporting to promote transparency and accountability related to municipal service levels. Annual review of fire flow tests and watermain break records results in the creation of projects for placement in the annual Capital Budget. In general, watermains having history of multiple breaks and/or substandard fire flow test results (in comparison to the needs of adjacent land uses) are considered as candidates for creation of capital projects. Halton Region Asset Management Plan

52 PW 2013 Infrastructure Condition Report Card (refer to Section 3.4 for the most recent report). Condition assessment of water infrastructure. Wastewater The Wastewater division tracks asset performance using the following measures. Wastewater Systems Effluent Regulation (WSER, 2012), established National Performance Standards for deleterious substances (Total Suspended Solids-TSS, carbonaceous Biochemical Oxygen Demand-cBOD and unionized ammonia). Halton s wastewater treatment program met or bettered the National Performance Standards (Q1 & Q2, 2014), refer to Appendix PW11 for a sample report. Wastewater System Performance Report. An annual report and appendices for each wastewater treatment plant in Halton. It provides a summary of the wastewater treatment system, ensures that Halton is meeting regulatory requirements for testing and includes analytical, plant flow, bypass, operational and biosolids data. MOE F-Series Guidelines (Containment and Treatment). Despite the hydraulic challenges caused by extraneous stormwater, Halton continues to provide legislated level (1) of treatment or higher to the significant majority of the wastewater volume generated. Refer to Appendix PW12 for a sample report. Municipal Performance Measurement Program (MPMP) which includes province-wide efficiency and effectiveness metrics and reporting to promote transparency and accountability related to municipal service levels. Participation in the National Water and Wastewater Benchmarking Initiative. PW 2013 Infrastructure Condition Report Card (refer to Section 3.4 for the most recent report). Waste Management The Waste Management division tracks asset performance using the following measures. Maintenance records which are an appropriate indicator of infrastructure performance. Municipal Performance Measurement Program (MPMP) which includes province-wide efficiency and effectiveness metrics and reporting to promote transparency and accountability related to municipal service levels. PW 2013 Infrastructure Condition Report Card (refer to Section 3.4 for the most recent report). Halton Region Asset Management Plan

53 5 Asset Management Strategy 5.1 Non-infrastructure Solutions Transportation The Transportation LOS ensure that adequate system capacity is provided and that the infrastructure is maintained in a state of good repair. A number of non-infrastructure solutions have been implemented to assist in meeting these LOS. Travel Demand Management and Active Transportation initiatives within the Transportation Master Plan assist in extending the life of assets by reducing singleoccupant vehicle usage and providing additional road capacity. The continuation of Smart Commute Halton P26 and the planning of High Occupancy Vehicle Lanes also reduce single-occupant vehicle usage and provide additional road reserve capacity that can extend asset life. Signal optimization and progression studies are undertaken on a programmed basis to ensure that existing system capacity is optimized through the adjustment and coordination of signal timing. Load restrictions are applied to extend pavement life on certain secondary roads where the pavement structure could be impacted by full truck loads. P27 Coordination of water and wastewater construction with transportation improvements reduces the impact of construction activities on the community and minimizes pavement cuts which reduce the life of the pavement structure. Joint contracts with the local municipalities help to minimize construction impacts for residents and lower project costs. As part of the Asset Management Strategy, certain infrastructure elements such as streetlight luminaires are run to failure. Other elements such as traffic signals and traffic controllers are replaced on a programmed basis because of the potential impact of failure. This strategy ensures that life cycle costs associated with various infrastructure elements are minimized. Halton Region Asset Management Plan

54 Water The Water division implements the following noninfrastructure solutions to help lower costs and/or extend the asset useful life. Optimization Program for Linear Assets and Plants has enhanced facility performance and capability which has resulted in process improvements. Through Supervisory Control and Data Acquisition (SCADA) automation of equipment, operating cost savings are achieved and asset life is extended. Water Efficiency Outreach and Conservation programs promote efficient water use and may contribute to the potential deferral of capacityrelated upgrades to the water system and reduction of peak-day water demands on the existing water system infrastructure. Joint contracts with the local municipalities help to minimize construction impacts on residents and to lower project costs. Where possible, Water Services combines projects with other programs such as Transportation and Wastewater to minimize construction impacts for residents and minimize project costs. Wastewater The Wastewater division implements the following non-infrastructure solutions to help lower costs and/or extend the asset useful life. Optimization Program for Linear Assets and Plants which has enhanced facility performance and capability and has resulted in process improvements. Through SCADA automation of equipment, operating cost savings are achieved and asset life is extended. Preventative maintenance and spot repair programs ensure assets continue to operate at an acceptable LOS. Annual Maintenance Flushing Program and flushing of wastewater main trouble sections help to remove debris, grit, grease, etc., ensuring main capacity and operation aren t compromised. Basement Flooding Prevention Subsidy Program P28. The program offers a one-time subsidy, up to a maximum of $2,725, to assist residents who: 1) have a history of basement floods caused by a backup or surcharge of the sanitary sewer system; or 2) Halton residents who have not experienced flooding but would like to correct improper storm water connections and install a backwater valve. Halton Region Asset Management Plan

55 Joint contracts with the local municipalities help to minimize construction impacts for residents and lower project costs. Where possible, Wastewater Services combines projects with other programs such as Transportation and Water to minimize construction impacts on residents and to minimize project costs. Waste Management The Waste Management division implements several non-infrastructure solutions to help lower costs and/or extend the asset useful life. Through these initiatives, the landfill site life has expanded from 20 years to a projected 53 years. Key initiatives/programs, implemented between 1996 and 2007, that helped to accomplish this are outlined below. Introduction of yard waste collection (1996) Residential bag-limit reduction from 9 to 6 bags (1996) Residential grass ban (yard waste collection) (2002) All rural residents received Blue Box recycling collection at their home (2004) Special events (tire amnesty, Environment Days, Household Hazardous Waste (HHW) Days, etc.) Backyard composter subsidy Diversion of additional materials at the container station: electronics, drywall, wood, etc. Non-profit Reuse Subsidy Program Enhanced communication materials such as calendars and newsletters In 2008, a variety of new diversion programs and waste collection contracts were implemented that had a substantial impact on reducing the incoming waste tonnage to the Halton Waste Management Site (HWMS). Incoming tonnage was reduced from 126,000 in 2007 to 74,000 in The Green Cart Collection Program alone diverts 27,000 tons from the HWMS facility annually. Furthermore, apartment waste and Industrial, Commercial and Institutional (ICI) waste collected by the Region via contract agreements with private haulers is not disposed at the HWMS. Additional programs/initiatives that have been implemented since 2008 include: Multi-residential diversion Service level changes including waste collection from weekly to bi-weekly, Blue Box and Green Cart collection from biweekly to weekly, and metal collection call-in Enhanced promotion, education and outreach Expanded Blue Box material collection (plant pots, other plastics) and capacity Expanded special waste drop-off events Residential bag limited from 6 to 3 bags and bag tags Diversion of incoming waste leads to lower asset depletion and therefore delays the asset replacement time. Halton Region Asset Management Plan

56 5.2 Maintenance Activities Transportation The Road Maintenance LOS define activities to be carried out in the areas of safety, preservation and quality of life, and establish the timeframes within which those activities will be completed. The LOS ensure that the Region s maintenance activities meet or exceed the provincially-mandated Minimum Standards for Municipal Highways (MMSMH). Weekly routine patrols undertaken to identify system deficiencies are supplemented by spring and fall night tours which are conducted to observe luminaires, safety devices, pavement markings and monitor sign replacement. This allows for better infrastructure planning and allows for the life of assets to be optimized based on actual performance rather than replacing assets on a fixed timeframe. Scheduled inspections of critical structural assets including bridges and culverts are conducted biannually. The Region s pavement management system is used to identify and prioritize road rehabilitation and renewal requirements, while specific project-level testing of roadway pavement is completed to ensure that the rehabilitation methodology is optimized. Based on data collected, localized resurfacing, crack sealing and renewal of pavement markings are conducted on an annual basis as required. More substantial road resurfacing and structural rehabilitation work is programmed for delivery as part of annual resurfacing and rehabilitation programs as described in section 5.3 Renewal/Rehabilitation Activities. Water The following maintenance programs are in place to ensure reliable operation of the system and high water quality. valve preventative maintenance hydrant preventative maintenance watermain flushing program watermain swabbing program Scheduled inspections of reservoirs, pumps, electrical controls, standby generators, as well as facility capital needs assessments, ensure continued operation of all facilities. Watermain leak detection studies are conducted to locate and repair small leaks in the distribution system from pinhole breaks and improperly installed or corroded joints and fittings. Wastewater The following maintenance programs are in place to ensure reliable operation of the wastewater system. Halton Region Asset Management Plan

57 Spot Repair Program perform minor repairs for deficiencies identified by operations staff and CCTV inspection reports. (Refer Appendix PW13 for a snap shot of CCTV.) Annual Maintenance Flushing Program and Flushing of Linear Trouble Sections - help to remove debris, grit, grease, etc., to ensure sewer main capacity and operation aren t compromised. Manhole Inspection Program maintains manholes in good working condition through condition assessment reports and from field observations. Preventative Maintenance Program performed as recommended by the original equipment manufacturer (OEM). Inspection, testing and calibration of electrical, mechanical, instrumentation and control equipment is performed and documented by fully-trained and qualified technicians. CCTV Inspection Program ensures every sewer main in the collection system is inspected at a minimum every one in 20 years. Waste Management The following maintenance programs are in place to ensure reliable operation of the waste management system. Preventative Maintenance Plan - involves weekly inspections of all pumping stations and measuring and control systems in order to ensure reliable operations. Annual Maintenance Plan - mechanical and electrical for all pumping stations, and measuring and control systems. Annual Leachate Collection System Flushing Program - in place with additional CCTV inspection as needed. 5.3 Renewal/Rehabilitation Activities Transportation As indicated in the previous section, rehabilitation and renewal programs are developed based on data collected through ongoing maintenance and inspection programs. These activities include actions such as road resurfacing, structural rehabilitation and traffic signal controller replacement. Work required to rehabilitate and renew existing infrastructure is coordinated with replacement and expansion activities and incorporated into the Region s 10-year capital program on a priority basis (refer Appendix PW4). It is noted that the Region is in a period of significant growth resulting in rapidly increasing transportation demand and a corresponding growth in the Region s capital expansion program. Based on the Transportation Master Plan, P29 investment in system expansion is expected to remain at high levels until Halton Region Asset Management Plan

58 The investment in system expansion also impacts decisions with respect to timing of renewal and rehabilitation activities. In many cases, system expansion is required before an infrastructure element has reached the limit of its useful life. The impact of system expansion is considered in the development of rehabilitation and renewal plans. Water Systematic performance indicators of the linear water system are reviewed annually to identify locations requiring renewal/rehabilitation initiatives. The performance indicators are derived from the following. DWQMS HR-W88 Infrastructure Review HR-P37 Review and Provision of Infrastructure Additionally, Water Services has a Cathodic Protection Program that involves the installation of sacrificial anodes on metallic pipes to reduce rates of corrosion, allowing metallic pipes and/or pipe components to reach expected service life. Renewal/rehabilitation needs are also identified through ongoing maintenance,inspections and condition assessments. Wastewater In order to extend the life of an asset, Wastewater has several rehabilitation and renewal programs that are developed based on data collected through ongoing maintenance and inspection programs. Inflow and Infiltration (I&I) Program the Region is continuously looking to reduce the amount of I&I within the sanitary collection system. Studies have been undertaken to identify problematic areas of I&I within the wastewater system and catchment areas. Currently, structural and operational repairs are underway to address defects to stop the infiltration from entering into the system. This also facilitates the Basement Subsidy Program by helping homeowners to disconnect any improper storm water connections. Spot Repair Program perform renewal/rehabilitation activities for deficiencies identified by operations staff and CCTV inspection reports. Manhole Rehabilitation Program manholes identified with deficiencies either through condition assessments or field observations, are repaired either with lining or grouting. The Region s 10-year Budget and Business Plan renewal and rehabilitation activities are identified based on maintenance and condition assessments. Capital projects are prioritized based on growth, coordination with local municipalities, age and condition of the asset. Halton Region Asset Management Plan

59 Waste Management Renewal and rehabilitation activities are identified through the Preventative Maintenance Plan and the Annual Maintenance Plan outlined in the previous section. 5.4 Replacement Activities PW has a conceptual 100-year plan which covers the entire asset life cycle to estimate replacement activities into the future. P30 TCA data used for financial reporting forms the basis of the 100-year conceptual plan (refer to Appendix PW3). The 100-year conceptual plan illustrates the estimated investment level required in order to maintain assets in a state of good repair as infrastructure reaches the end of its service life. It should be noted that infrastructure that is nearing the end of its service life is assessed and the results trigger the necessary asset management strategy to continue operation that may include increased monitoring and maintenance, rehabilitation, replacement or run to failure. (Refer to Appendix PW3 for 100-year asset life cycle plans.) Additionally, in 2014, the 20 year capital needs for state-of-good-repair capital water and wastewater infrastructure were reviewed. This review was leveraged in the development of the proposed 2015 Capital budget for Replacement of infrastructure elements is considered in the same manner as rehabilitation and renewal activities. Long-term capital replacement requirements are incorporated into the 10-year Capital Budget based on life cycle estimates and are programmed based on detailed inspection data and project-specific needs. Replacement of infrastructure is being impacted by the need to provide additional system capacity where assets with residual useful life are being preserved through the expansion of the infrastructure system. 5.5 Disposal Activities All PW divisions follow an approved Purchasing Policy for Surplus and Disposal as part of the Purchasing Bylaw that was approved by Regional Council. Section 30 of the bylaw outlines the surplus and disposal of assets and related activities. Halton also has TCA and data verification policies that outline the disposal of assets and how those disposals are recorded in the financial records. Halton Region Asset Management Plan

60 5.6 Expansion Activities Transportation The Region is in a period of significant growth which in some cases has resulted in the renewal of existing road infrastructure before the limit of its useful life. To mitigate the impact of early replacement of assets, maintenance, rehabilitation, renewal and replacement activities are coordinated with required capital expansion. Within Transportation Services, the Region s current Transportation Master Plan, approved by Regional Council in November 2011, establishes capital improvements required to meet transportation demand arising from growth in the Region to 2031 (refer to Appendix PW14). Water and Wastewater The Sustainable Halton Water and Wastewater Master Plan identifies infrastructure required to accommodate growth within the 2031 planning horizon. In some cases, the plan addresses capacity needs for post-2031 growth where it is advantageous to construct at an earlier date (i.e. secure property at this time for major facilities where it is estimated future opportunities to acquire land will not exist). Waste Management Waste Management addresses expansion activities through analyses of population growth projections and capacity considerations for the waste management facilities. 5.7 Procurement Methods Halton Region s Council-approved Purchasing Bylaw P5 guides all procurement practices. The Purchasing Bylaw is supported by related internal policies and procedures. The key objectives of this bylaw are to: Encourage competitive bidding; Ensure objectivity and integrity of the procurement process; Ensure fairness between bidders; and Maximize savings for the taxpayers. The full bylaw is available on the Halton Region website. Procurement can include joint contracts with internal divisions and external municipalities/agencies through capital planning or development-related infrastructure planning. Halton Region Asset Management Plan

61 5.8 Risks Associated with the Strategy Transportation Within Transportation Services, risks relating to infrastructure failure are mitigated through inspection and maintenance programs which provide the necessary data to ensure that the work required to achieve the established LOS is identified. Annual capital and maintenance budgets ensure that funding to undertake the necessary work is provided. Through the annual Transportation Service Progress Report and updates to the Transportation Master Plan, Council has the opportunity to adjust LOS in the event that funding to meet current LOS cannot be provided. Water The DWQMS, HR-P28 Risk Assessment Framework and the HR-F63 Risk Analysis Framework are used to identify, assess and mitigate risk to the water system. The assessment looks at unit processes, identifies possible hazards, assigns a score to the risk, and identifies existing procedures to mitigate the risk. In addition, the Sustainable Halton Water and Wastewater Master Plan includes a detailed evaluation of water system servicing options. Evaluation matrices are used to compare and contrast various alternative solutions including the assessment of risks. Wastewater In combination with legislated regulations, Wastewater Services has several procedures and preventative measures to help assess and mitigate risk to the environment and to reduce risk of basement flooding. In circumstances of non-compliance,halton Region would report incidents to the MOE. If the issue of non-compliance is repeated or prolonged, MOE can specify corrective actions, including orders, fines and other measures. In order to mitigate the risk of wastewater infrastructure surcharging, the Region has overflows at critical control points, including treatment plants and pumping stations. If the system becomes surcharged with extraneous flows the overflow protects downstream infrastructure and connections. There is also an internal emergency response plan should a break or failure occur, allowing for a quick response time and repair. Waste Management Within Waste Management Services, risks include losing existing non-infrastructure solutions, limited availability of non-infrastructure solutions, unforeseen MOE requirements and unforeseen political directions. These risks are evaluated on an ongoing basis to ensure proper action can be taken to reduce the potential impact. Halton Region Asset Management Plan

62 5.9 Options Analysis Transportation Transportation Services undertakes an analysis of options in order to minimize life cycle expenditures in the maintenance, rehabilitation, replacement, disposal and expansion of transportation infrastructure. As previously stated, optimization of life cycle maintenance, rehabilitation and replacement activities is currently impacted by the need for rapid system expansion to Water and Wastewater Halton Region follows the Municipal Class Environmental Assessment (EA) decision-making process for the Water and Wastewater Master Plan and Schedule A, B or C projects. This process evaluates all feasible options and bases the evaluation on the following factors. natural environment socio-economic conditions cultural considerations technical environments life cycle cost The same considerations are applied to Schedule C Class EA Studies and detailed design for major works. Waste Management The approved Waste Management Strategy P31 took into consideration options relating to increased diversion rates in order to lower asset depletion. The options analysis considers the following in addition to the above Direct Benefits and Costs Transportation The Region s Transportation Master Plan identifies a number of policies and programs aimed at reducing single-occupant vehicles with an aim of minimizing the need for system expansion. These initiatives include: traffic demand management programs, provision of infrastructure to support high corridors (e.g. HOV), the development of an Active Transportation Master Plan, and signal optimization and corridor progression studies. All of these initiatives are in addition to Halton Region Asset Management Plan

63 programmed maintenance and rehabilitation works and are aimed at extending the life of existing infrastructure by optimizing system capacity. By optimizing system capacity, capital expansion projects can be deferred. Water The Water Efficient Toilet Rebate Program and Outdoor Water Use Management Strategy may contribute to decreased water demand reducing overall water production/transmission costs and potentially deferring expansions due to demand growth. Wastewater The Optimization Program for Linear Assets and Plants allows for enhanced facility performance and capability which have resulted from process improvements. Through SCADA automation of equipment, operating cost savings are achieved and asset life is extended. Also the I/I Program outlined under maintenance activities contributes to infrastructure operational performance. In addition, Halton s Basement Flood Prevention Subsidy Program, offers a one-time basement flood prevention subsidy up to a maximum of $2,725. This assists homeowners with disconnecting downspouts, weeping tiles and sump pumps from the sanitary sewer to the storm sewer. It also helps to prevent sanitary sewers from surcharging and reduces the amount of inflow that is treated at the wastewater treatment plants. Another benefit is the regained capacity in the sanitary sewer. Waste Management As per Waste Management Strategy , diversion programs lead to lower asset depletion and therefore a delay in asset replacement costs over time Indirect Benefits and Costs By implementing the Asset Management Strategy as described above, the community impact of construction and maintenance activities is minimized. For example, traffic management provisions within Regional construction activities are undertaken in a manner that minimizes the impact to the community. Through the Water Efficiency Outreach Program and Outdoor Water Use Management Strategy, water consumption is reduced. The Waste Management Strategy was developed with community involvement which translated into immediate buy-in to the changes being implemented. Such initiatives promote the well-being and health of residents and promote a positive Regional image. Halton Region Asset Management Plan

64 5.10 Asset Management Strategy and the Budget and Business Plan All of the above PW asset management strategies are considered in developing the annual budget and 10-year forecast following the process as outlined in Appendix PW15, PW Budget Process. These considerations ensure that the PW budget balances program needs and the impact on Halton residents by focusing on key priorities and commitments to service delivery. Projects are identified from a variety of sources, as described in this section of the AMP, including residential complaints, studies, maintenance history, age, condition and fire flows. Linear project cost estimates are based on average Halton tender prices from the previous year ($/m) while facility projects are typically based on costs provided by third party engineering firms retained by Halton. The projects are subject to internal prioritization, risk assessment and project drivers followed by collaboration with the Finance Department as described in Section 6 Financing Strategy. After this rigorous process, the budget is finalized and presented to Council for approval. 6 Financing Strategy Staff in the Financial Planning and Budgets division of the Finance Department are responsible for the development and monitoring of the Financing Strategy for all expenditures including those relating to infrastructure. 6.1 Financing Plan Development Capital Expenditures Through the annual budget process, capital project information is gathered from the PW program areas. The selection, expenditure development, and prioritization processes for the projects are described in Section 5 of this document titled Asset Management Strategy. As described in Section 5, the requested budget is reviewed with the program areas to assess the program needs, trends and priorities. The review includes actual costs incurred in the past for similar projects, as well as current costs to date for projects in progress to determine adequate project funding requirements. The Capital Budget includes a 10-year forecast, however, program areas maintain budget forecasts exceeding this time period. Once the requested budget is finalized, financing options for the request are determined based on the optimum funding structure taking into account the following key sources of financing. Halton Region Asset Management Plan

65 debt reserves grants/recoveries development charges (for growth infrastructure) The Province sets a debt-capacity guideline for municipalities at 25 per cent of own revenues. Halton Region uses a debt-capacity guideline of 10 per cent of gross operating expenditures which translates to about 13 per cent of own revenues. The Region s goal is to maintain debt levels at targets below the internal guideline to minimize the impact of debt charges on the Operating Budget. It should also be noted that Provincial legislation only allows the use of debt for capital expenditures. The Region has a Council-approved Reserve Policy in place (refer to Appendix PW16). Capital Reserves are established to fund the Region s capital program. Funding for these reserves is obtained from annual Operating Budget provisions (budgeted transfers from the Operating Budget), supplementary taxes and annual Operating Budget surpluses. The annual reserve transfers are based on forecasted financing requirements and provisions made to sustain reserve balances at target levels to address infrastructure replacement costs in the future and inherent uncertainties in capital funding needs. Reserve transfers are evaluated annually to ensure funds are raised to meet future capital requirements and to smooth out the impact on the annual Operating Budget. Grants from the Province or the federal government are also used to finance capital. Ongoing funding agreements include Gas Tax revenue. However, many grants are a result of stimulus or other one-time funding that may be more difficult to forecast. Most grants are included in the budget forecast when confirmed. Development Charges (DCs) are collected by the Region from developers under the Region s DC Bylaw (48-12). DCs are used to finance the development (growth) share of the capital programs and are stored in designated DC reserve funds until they can be used to pay for growth-related infrastructure as prescribed in the DC Bylaw. Projections relating to DC revenues are based on DC rates and the projected growth in residential units and non-residential areas. (For a diagram of the Financing Strategy Process for Capital, refer to Appendix PW17.) Operating Expenditures Each year staff from the Financial Planning and Budgets division and the program areas develop the current year Operating Budget and 10-year forecast. Operating expenditures include those related to infrastructure operation and maintenance as well as capital financing (reserve transfers). The Operating Budget review takes into consideration the Capital Budget forecast to ensure sufficient funding is available to operate, repair and maintain capital infrastructure. The maintenance of infrastructure in good condition continues to be a priority. Other factors such as expected inflation rates and variances in current budgets are also considered when developing the expenditure forecast. Halton Region Asset Management Plan

66 Key sources of funding for the Operating Budget include: tax revenue user fees Tax revenue is collected from residents to finance tax supported programs, including Transportation and Waste Management. Property value increase projections as well as residential and non-residential unit growth projections are used to estimate tax revenue over the forecast period. User fees are collected from water and wastewater utility rates based on water consumption to support water and wastewater infrastructure. Usage rate projections, future capital requirements, desired rate increases and historical trends are used to prepare the forecasted revenue. In addition, as described in Section 5 Asset Management Strategy, risks relating to the provision of services such as water treatment, distribution and wastewater collection are evaluated to ensure health and safety of residents. Other sources of funding for the Operating Budget include investment interest, user fees for demand based services, and provincial funding. 6.2 Current Financing Plan Summary Capital Expenditures In 2015, the capital projects forecasted will be listed in the Budget and Business Plan using the following classifications. Non-infrastructure Solutions Renewal/Rehabilitation Activities Replacement Activities Disposal Activities Expansion Activities This breakdown is not available for the 2014 Budget and Business Plan. The forecasted capital expenditures (in 000 s) for each of the divisions of the PW Department are: * refer to pages D183-D188 and D220-D222 of the Budget document for details Halton Region Asset Management Plan

67 The revenue forecast by revenue type (in 000 s) for each of the divisions of the PW Department is: Transportation Division Revenue Type Total Debentures (Debt) nil nil $0 Reserves $82,150 $504,454 $586,604 Development Charges $80,538 $522,733 $603,271 Subsidies & Recoveries $14,400 nil $14,400 Total $177,088 $1,027,187 $1,204,275 *please refer to pages D183-D188 of the Budget Document for details Water Division Revenue Type Total Debentures (Debt) $8,509 $116,142 $124,651 Reserves $32,719 $348,785 $381,504 Development Charges $41,683 $349,028 $390,711 Subsidies & Recoveries $127 nil $127 Total $83,038 $813,955 $896,993 *please refer to pages D220-D222 of the Budget Document for details Wastewater Division Revenue Type Total Debentures (Debt) $4,420 $11,170 $15,590 Reserves $39,457 $328,635 $368,092 Development Charges $40,481 $195,003 $235,484 Subsidies & Recoveries $190 nil $190 Total $84,548 $534,808 $619,356 *please refer to pages D220-D222 of the Budget Document for details Waste Management Division Revenue Type Total Debentures (Debt) nil nil $0 Reserves $2,215 $46,046 $48,261 Development Charges nil nil $0 Subsidies & Recoveries nil nil $0 Total $2,215 $46,046 $48,261 *please refer to pages D183-D188 of the Budget Document for details Halton Region Asset Management Plan

68 Operating Expenditures Capital maintenance expenditures are allocated to each program area and are shown in the budget document as part of different expense types, for example, as part of treatment expenses. Maintenance expenditures are analyzed in detail internally when preparing the Operating Budget. The Rate Supported Operations and Maintenance Budget for Water and Wastewater programs is presented in the Budget and Business Plan. *please refer to page 177 of the Budget Document for details Reports including maintenance expenses only for all program areas are available internally. Actual expenditures by category are listed in the budget document for comparison for the three years prior to the budget year. Relating details are available internally. The current year actual expenditure is a projected amount as next year s budget is prepared before the current year end. The forecasted total net operating expenditures (in 000 s), including maintenance but excluding capital financing, for each of the divisions of the PW department are: *please refer to page 188 and 109 of the Budget Document for details The following table illustrates capital financing only (in 000 s) for each of the divisions of the PW department. *please refer to page 188 and 109 of the Budget Document for details Halton Region Asset Management Plan

69 Annual revenue requirements for all programs over the forecast period are presented in the budget document for the tax-supported and rate-supported budgets. Details relating to revenue sources are analyzed internally. As stated above, the Transportation and Waste Management programs are supported mainly by tax revenue while the Water and Wastewater programs are supported by user fees. Other funding sources are also used to finance operating expenditures. The following table details the total other funding sources (in 000 s) for each of the PW divisions. *please refer to page 188 and 109 of the Budget Document for details For more information relating to the Financing Strategy, refer to the Halton Region Budget and Business Plan Document. Halton Region Asset Management Plan

70 Public Works Footnotes P1 Ministry of Infrastructure Ontario- Building Together Guide for Municipal Asset Management Plans P2 The Citizens Priorities Halton Region s Action Plan P3 The Citizens Priorities Halton Region s Action Plan 2012 Report to the Citizens priorities_ _action_plan/ P4 Halton Region 2014 Budget and Business Plan P5 BY-LAW NO A BY-LAW TO DEFINE PROCUREMENT POLICIES AND PROCEDURES FOR THE REGIONAL MUNICIPALITY OF HALTON AND TO REPEAL BY-LAW NO P6 TCA Guidance P7 Public Works 2010 Infrastructure Condition Report Card _program/ P8 TCA Procedures (How To) P9 TCA Processes and Policies Secure drive \Capitalassets(\\halton.local\fileshare)\Processes&Policies P10 TCA Procedures and Processes Report in hard copy Regional Municipality of Halton Valuation of Water and Wastewater Facility Assets final, April 2008, by R.V. Anderson Associates Limited P11 Infrastructure report card development procedures and assumptions Secure drive \pwesdept (\\halton.local\fileshare)\ Business & Technical Services\Business Services\ PW Asset Management Report Card P12 Infrastructure report card development process and assumptions Council Report: PW Public Works Infrastructure Management, Phase 1 Report Card Halton Region Asset Management Plan

71 P13 Council Report No. - Re: PW Transportation Services Progress Report, Halton Region 20Works%20PW5612%20%202011%20Transportation%20Services%20Progress%20R%20%20 PW5612doc% pdf P14 The Road to Change: Halton Region Transportation Master Plan 2031, Halton Region, Appendix F5 Level of Service P15 Region of Halton Road Needs Study 2013, 4 Roads Management Services Inc. (Report in hard copy) P16 Council Report No. - Re: PW Regional Road Maintenance, Halton Region 20Works%20PW7212%20%20Regional%20Road%20Maintenance%20%20PW7212doc% pdf P17 Minimum Maintenance Standards Regulation 239/02, Province of Ontario P18 Public Transportation and Highway Improvement Act OntReg 104/97, Province of Ontario c0ed7c71d352/1/doc/?search=browsestatutes&context=#hit1 P19 Sustainable Halton Master Plan P20 Accessibility for Ontarians Disabilities Act, bd3951cf527/1/doc/?search=browseStatutes&context=#hit1 P21 The Big Move, Metrolinx Regional Transportation Plan P22 ROPA 38, Regional Official Plan, Region of Halton P23 Drinking Water Quality Management System (DWQMS) P24 Municipal Performance Condition Program (MPMP) Halton Region Asset Management Plan

72 P25 National Water and Wastewater Benchmarking Initiative P26 Smart Commute Halton P27 Halton Region, Load Restrictions P28 Basement Flooding Prevention Subsidy Program P29 The Road to Change: Halton Region Transportation Master Plan 2031, Halton Region, Appendix F5 Level of Service P30 Public Works Long Range Asset Plan Draft; Presentation to Budgets June 20 th, 2013 Secure drive \pwesdept (\\halton.local\fileshare)\ Business & Technical Services\Business Services\ PW Asset Management Report Card\PHASE2 P31 Waste Management Strategy http:// Halton Region Asset Management Plan

73 Public Works appendices PW1 PW Asset Management Roadmap To be updated in 2015 with specific projects as a result of The Public Works Asset Management Implementation Plan development. Halton Region Asset Management Plan

74 PW2 Infrastructure Asset Values Halton Region Asset Management Plan

75 PW3 PW Long Range Life Cycle Plans Long Range Life Cycle Plan Limitations and Assumptions The current long range life cycle plan is a high level conceptual plan based on estimated useful asset lives and does not take into consideration the following: o o o o Asset rehabilitations, upgrades, and optimization programs implemented through the annual Capital Budget that may extend asset useful life Asset conditions that may result in revised asset life New growth Assessment of critical assets Asset estimated useful lives are based on the Tangible Capital Asset (TCA) data that was assembled to meet financial reporting requirements. The life cycle plan will be reviewed and updated on an annual basis to adjust for new infrastructure and to also reflect measures undertaken through the annual Capital Budget to extend the useful life of assets including rehabilitations, upgrades and optimization programs. The average annual expenditure, which is the sum of all the expenditures over the plan time line (100 years) divided by 100 years, assumes that assets are replaced at the end of their estimated useful life. Ordinarily when assets are approaching the end of their useful lives, their condition is assessed and asset management strategies including increased monitoring and maintenance or rehabilitation activities are implemented which may increase the asset useful life. The costs of these strategies are included in the Capital and Operating Budget forecast to maintain infrastructure in a state of good repair. The Ontario Ministry of Infrastructure guide recommends that an AMP should cover the entire life cycle of assets. 100 years was used based on the useful life of 90 years for a water pipe made of Polyvinyl Chloride (PVC) which is the longest lived asset in the Halton Region TCA records. Asset replacement values were calculated by indexing asset historical cost as per TCA records with the Non-Residential Building Construction Price Indices (NRBCPI). Halton Region Asset Management Plan

76 PW3-1 Transportation Halton Region Asset Management Plan

77 PW3-2 Waste Management Halton Region Asset Management Plan

78 PW3-3 Water and Wastewater Halton Region Asset Management Plan

79 PW4 Capital Budget Process Halton Region Asset Management Plan

80 PW5 Asset types PW5-1 Transportation Asset Types Halton Region Asset Management Plan

81 PW5-2 Plant Facilities Asset Types Halton Region Asset Management Plan

82 PW5-3 Water and Wastewater Linear Asset Types Halton Region Asset Management Plan

83 PW5-4 Waste Management Asset Types Halton Region Asset Management Plan

84 PW6 Remaining useful life Halton Region Asset Management Plan

85 PW7 Asset Record Samples PW7-1 RIVA asset record Halton Region Asset Management Plan

86 PW7-2 SAP asset record Halton Region Asset Management Plan

87 PW8 TCA Asset System Architecture G/L Current year accruals at Project Level Automatic transfer of transactions AA TCA Assets Set up for Asset Acquisition Costs AA AUC Apportionment AUC to Assets Manual upload into SAP 1. Add Asset Shell 2. Update attributes SAP Asset Number & Acq. Values Enterprise Inventory Asset Details Settlement Cost (TCA- Yes projects) CO Capital Internal Orders CO Cost Centers Excel Upload into Riva Settlement Cost (TCA- No projects) All New/Chg d/ret Assets Records Linear assets (Transportation & Water/Wastewater) TCA yes or no Inventory Area Linear Asset source record created/ updated ESRI Geodatabase IPFS Budget Capital Projects Non GIS Asset Records Water/ Wastewater Linear System Operations Hansen CMMS Field updates - changes* Change Report Financial transaction for changes Interface between source system (GIS) and financial system (SAP) *Changes: Found Retired Dimension Material type Location Split Acquisition year Project / DSA Number Drawings New and Retired Assets Halton Region Asset Management Plan

88 PW9 Roadway Appraisal Sheet Halton Region Asset Management Plan

89 PW10 Structure Inspection Form Halton Region Asset Management Plan

90 PW11 Wastewater System Effluent Monitoring Report PW12 Region Wide and Spatial Distribution Percent Volume by Treatment Level (2012) Halton Region Asset Management Plan

91 PW13 CCTV Sewer Main Snap Shots Halton Region Asset Management Plan

92 PW14 Transportation Master Plan Capital Plan Halton Region Asset Management Plan

93 PW15 PW Budget Process Halton Region Asset Management Plan

94 PW16 Halton Region Reserve Policy Halton Region Asset Management Plan

95 PW17 Financing Strategy Process for Capital Expenditures Halton Region Asset Management Plan

96 PW18 Region of Halton Asset Management Framework Halton Region Asset Management Plan

97 Part 2: Corporate Facilities and Social Housing Halton Region Asset Management Plan

98 2 INTRODUCTION The Corporate Facility and Social Housing Asset Management Plan (AMP) will produce a Capital Plan that is: Reliable and executable; Addresses the Region s most critical needs that are matched with available financial resources; and Is aligned with Council s strategic goals and legislated requirements. The Corporate Facility and Social Housing AMP is an annual, five-year, 10-year and 25-year plan that is updated throughout the year as well as on an annual basis when developing budgets for assets managed under the AM Division of the Legislative and Planning Services (LPS) Department. (Refer Appendix AM1 for AM Capital Budget Development Process.) An AMP is a key component in the asset management of the corporation s fixed assets. It provides a description of the overall system components, and summarizes key asset and planning information at a single point in time. Its primary purpose is to identify the financial consequences of delivering services through physical assets, describing: The importance of physical assets to delivering organizational objectives and outcomes; The quality of existing physical assets in terms of condition and asset performance; The assets needed to meet or sustain current levels of service, and to address current and future funding shortfalls; The feasible asset and non-asset solutions to address identified funding shortfalls; and The level of organizational commitment and planned improvements. The AM Division maintains an annual budget document including all details related to the AMP for Corporate Facilities and Social Housing. A1 2.1 Asset Management Plan Purpose The purpose of an AMP is to make the best possible decisions regarding the construction, operation, maintenance, renewal, replacement, expansion and disposal of infrastructure assets. A properly-designed AMP minimizes infrastructure risk and cost and maximizes services provided by the assets. Halton Region Asset Management Plan

99 Asset Management (AM) applies recognized asset management practices in support of delivering services to program areas within the Region. AM will aim to achieve the following. Deliver services at approved Levels of Service (LOS). Improve decision-making accountability and transparency. Ensure decisions are integrated with strategic planning. Ensure decisions are based on an evaluation of alternatives that consider life cycle costs, benefits and risk of ownership. Support the development of scenarios to provide educated decisions. Establish accountability for asset condition, use and performance. Improve customer service. Reduce the life cycle costs while maintaining acceptable levels of service. Link infrastructure investment decisions to service outcomes. Support energy and sustainability investments initiatives. AM follows a Comprehensive Asset Management approach which is an integrated business approach involving planning, finance, engineering, maintenance and operations for effectively managing existing and new infrastructure to maximize benefits, reduce risk and provide safe and reliable LOS to the program areas. This is accomplished in a socially, culturally, environmentally and economically conscious manner. Comprehensive Asset Management relies on four key organizational components integrating together to achieve the desired service outcomes. They are: Well-planned strategies Good physical assets Highly-trained professionals with respect to practices and procedures Integrated business processes These components, supported by appropriate technologies, provide a robust foundation for efficient service delivery. The AMP is linked to the Halton Region Budget and Business Plan and is based on corporate objectives, priorities and key Council directives with respect to all Regional services. The following are a few of the key drivers in the delivery of the AMP: Accommodations Strategy Citizens Priorities Action Plan Halton Region Asset Management Plan

100 Comprehensive Housing Strategy Constructing and Maintaining Infrastructure (Strategic Initiative Planning) Corporate Sustainability Action Plan Corporate Energy Management Plan Long-term Affordable Housing Strategy 2.2 Assets Included in the Plan The AMP applies to the following Corporate Facilities and Social Housing buildings of the Region. Owned Corporate Facilities: Halton Regional Centre Long-term Care Facilities (3) Halton Region Paramedic Services Ambulance (8) Halton Museum Woodlands Operations Centre (South Operations) North Operations Centre Halton Waste Management Building Facilities Child Care Centres (3) Social Housing: Halton Community Housing Corporation buildings (including a child care facility) Oakville Senior Citizens Residence 2,300 units (in 13 Senior Communities & 19 Family Communities) Assets managed by the Asset Management Division: Land Banks Leased Facilities, including one child care centre owned by HCHC First Line Properties (4 part of Public Works infrastructure assets) New or existing assets may become the responsibility of the Asset Management Division during the year. The asset condition is evaluated through Building Condition Assessments performed on a fiveyear rotating cycle. Most of the assets are assessed to be in good condition as illustrated in Halton Region Asset Management Plan

101 Appendix AM 2 Corporate and Social Housing Assets Infrastructure Condition Report Card. Asset information is compiled in accordance with Regional policies and procedures and is stored in the Region s accounting system, individual property Building Condition Assessment records and the capital asset management software. This asset information is also subject to external audit. 2.3 Asset Management Plan Development and Timeline The AMP was developed by staff and management in the AM Division working with client departments. The Financing Strategy section of the plan was developed working with staff from the Financial Planning and Budgets Division. The Capital Budget Plan submitted for approval includes a 10-year forecast; however, much of the information gathered for the assets is projected over a 25-year period. The AMP includes the following considerations. 1. State of Asset Infrastructure Trends Asset types and quantity Asset age distribution and asset age as a proportion of useful life Asset condition assessed according to engineering practices 2. Funding Sources Revenue forecasts 3. Management Frameworks Complete inventory Capital planning Inspection and preventative maintenance information Predictive management from performance data Building Condition Assessments Feasibility studies Reserve Fund studies/sustainability Plan Life cycle cost analysis Service levels AM requests AM Halton Design Guidelines Halton Region Asset Management Plan

102 4. Corporate AM Requirements Public Sector Accounting Standard (PSAB) requirements Sustainable development Energy efficiency 5. Technology Excel and Word documents Capital Planning Software (CPS) tool (for samples of reports and forms please refer to Appendix AM 11) Computer Maintenance Management Software (CMMS) tool (for samples of reports and forms please refer to Appendix AM 11) Inspection equipment 2.4 Asset Management Plan Evaluation and Ongoing Improvements The AMP is a living document that will continue to reflect the evolution of asset management within Halton Region. Plan details are reviewed on an ongoing basis to ensure efficient and effective service delivery to clients and the public. The AMP will be continuously evaluated and improved through clearly-defined actions such as: Ongoing Building Condition Assessments (BCA) Review of asset performance Up-to-date inventories Updates to asset information such as condition, serial numbers and life expectancy Inclusion of unplanned corrective maintenance expenditures Updates to preventative maintenance plans Performance of metric reviews Return on Investment reviews Life Cycle Costing Index reviews Review of new trends and technologies Halton Region Asset Management Plan

103 3 State of Local Infrastructure 3.1 Asset Types The definitions below are used when preparing the AMP for the AM Division. Asset Capital is defined as equipment which is fixed, built-in or permanently affixed to a building or structure. Equipment within Asset Capital includes: Primary building structure Building envelope Public circulation and fire egress Building hardware General building construction, such as heating systems, exhaust and air conditioning systems, elevators and fixed seating in auditoriums Built-in or permanently affixed to a building or structure, i.e. walk-in freezers, cooking exhaust hoods Asset Capital Expenditures are non-recurring costs that will provide the following: Significantly increase capacity, quality or efficiency (i.e. betterment); Extend the useful life of the capital asset; and/or Refit/replace an entire item with a useful life exceeding five years. Halton Region Asset Management Plan

104 Project Capital is an expenditure for the construction, expansion, purchase, replacement, or major renovation of any facility whether free-standing or an addition of physical structures. Project costs can include the cost of land, engineering, architectural planning, and contract services needed to complete the project. Program Capital is based on modifications to the building as program needs change and the expenditures are for capital items of a less than permanent nature and normally at a lower cost. Program Capital includes equipment that is not permanently attached to the building and is moveable with the entire program to meet its needs. These expenditures would normally cost more than $5,000. Examples of such expenses are hospital beds, common-room furniture, fridges/freezers, general-use building furniture and furnishings, generally-assignable meeting room furniture, generally-assignable office furniture and equipment, all with an expected useful life of a year or more. These assets are excluded from the AMP. Asset Capital and Project Capital for the facilities and buildings listed in Section 2.2 are within the scope of the AMP. Halton Region Asset Management Plan

105 Program Capital is excluded as it is managed within the program areas and does not form part of the facility or building. It should be noted that some furniture and fixtures form part of the facility or building as per the Uniformat II structure listed in the next section. 3.2 Asset Valuation Financial accounting valuation uses historical costs and depreciation assumptions to determine the book value of capital assets in accordance with PSAB. Halton Region has developed a methodology and policies to account for TCA on a consistent basis through a project required to meet the requirements of the financial accounting standard PS 3150 Tangible Capital Assets. Buildings and facilities are recorded using eight Level One components of the UNIFORMAT II structure detailed in Appendices AM4 and AM5. The eight components are: Substructure Shell Roof Interiors Services Equipment and Furnishings Special Construction and Demolition Building Site Work The total book value of all general capital owned by Halton Region including Corporate Facilities and Social Housing but excluding infrastructure as at December 31, 2013 was $454 million. The book value of owned Corporate Facilities included in the AMP as at December 31, 2013 was $75 million. This book value excludes leased facilities and facilities managed by the Asset Management division that are classified as infrastructure. The book value of Social Housing building assets owned by the Halton Community Housing Corporation (HCHC) as at December 31, 2013 was $93 million. Replacement cost valuation is forward-looking and accounts for expected inflation, changes in technology and other factors. The AM Division maintains a listing of replacement costs for the Corporate Facilities and Social Housing assets. These replacement costs are based on BCAs performed for all facilities. Replacement costs are also used to assess insurance premiums on the properties. The replacement cost of Corporate Facilities owned is currently estimated at $175 million. The replacement cost of Social Housing assets owned by HCHC is currently estimated at $266 million. Managed assets are also insured but the values are not included in the AMP. The replacement costs are represented in current dollars. (Please refer to Appendix AM10 for details.) Halton Region Asset Management Plan

106 3.3 Asset Age Distribution Asset age distributions are maintained in the Region s accounting system, SAP. These asset age distributions are based on the expected useful lives and the current age of the assets. Typical useful lives are documented in Appendix AM4. Appendix AM9 details the life expectancy for specific components. The expected remaining useful lives of the assets are reviewed on a regular basis through the use of BCAs which are described in more detail in the next section. The BCAs review the current condition of the asset based on various factors such as wear and tear, and provide an updated estimate of the remaining useful life. Updated useful life information informs infrastructure investment decisions. The current asset age distribution of owned assets listed in Section 2.2 based on the accounting system is: Asset Type Average Useful Life Average Remaining Useful Life Corporate Facilities Social Housing *Estimates based on the building substructure component which has the longest useful life of all building components and is therefore considered the most representative of the total useful life of the facility or building. Average useful lives using all building components as listed in Appendix AM 4 would be lower due to the pooling of multiple components with different typical useful lives ranging from years. Halton Region Asset Management Plan

107 3.4 Asset Condition Assessments BCAs are completed on a five-year rotating cycle or sooner if conditions change. BCAs form a basis for the development of the Financing Strategy contained in the Capital Budget. The BCA projects an overall 25-year life cycle costing analysis for each program area. These assessments provide basis for a detailed projection of the anticipated funds required in the future to allow for the assets to continue functioning properly. The review of the physical assets includes an inspection of the asset, interview with sources, and the review of available documentation for the purpose of developing an accurate and supportable result of an asset s current physical condition. The Asset Management Strategy includes updating the BCA s in electronic form through discussions with the AM team and the various client groups. Annually, a Capital Plan is developed and incorporates all assets and their conditions. The assumptions of the client s requirements and physical condition of each asset are recorded and documented into the updated BCA s along with the future capital plans. Assumptions used in the BCAs are reviewed and verified by the Manager, Asset Reliability and/or Engineer to confirm the replacement values, useful lives and replacement requirements. The verification can be performed through discussions and site visits. Property Assessment Conditions The following definitions are used to describe the condition of each element that is reviewed. Excellent Condition: no defects, as-new condition and appearance Good Condition: minor defects, superficial wear and tear, some deterioration to finishes, major maintenance not required, not requiring capital expenditure Fair Condition: average condition, significant defects are evident, worn finishes require maintenance, services are functional but need attention, likely to become poor within a few years if not addressed Poor Condition: badly deteriorated, potential structural problems, inferior appearance, major defects, components fail frequently, observable deterioration requiring capital repair or the component failing Halton Region Asset Management Plan

108 Very Poor: building has failed, not operational, not viable, and unfit for occupancy or normal use, environmental/contamination/pollution issues exist Overall condition assessments are communicated to management and Council through the Corporate and Social Housing Assets Infrastructure Condition Report Card (please see Appendix AM2). 3.5 Asset Information Sources Accounting data, including asset details such as historical cost, expected and current useful life and asset location, is housed in the Region s accounting system, SAP. This is achieved through the RIVA interface which is directly synchronized to asset management applications. Detailed data relating to current replacement costs and asset condition is included in the BCA for each facility. This data is also included in the CPS which supports the AMP strategy decisions. 3.6 Policies and Procedures Regional policies and procedures relating to Corporate Facilities and Social Housing assets are reviewed on a regular basis to ensure they comply with all relevant legislation and meet the objectives of the AMP. Halton Region Asset Management Plan

109 4 Desired Levels of Service (LOS) 4.1 Levels of Service The AM Division maintains Corporate Facility and Social Housing asset performance at required levels of service while minimizing total life cycle costs. The required LOS are set based on the following considerations. Legislated requirements Council direction based on Citizens Priorities Condition assessment information Client needs and requests AM Halton Design Guidelines LOS are met through the following procedures and processes. AM Request (AMR) forms are completed and submitted to AM. The AMR represents the scope of work that will be completed within the year under a time frame to meet the target. Similar AMRs in nature will be grouped together and issued as one contract for better economies of scale. Scope of work is based on a priority ranking (described in the next section). The priority rankings take several LOS factors into consideration including the asset condition assessment, asset age and legislated standards. Code and bylaw changes are reviewed as they occur and impact the timeline for the work to be completed. Emergency Calls require replacement to begin immediately. Ongoing review of asset demand. Periodic Life Cycle Costing Analysis (LCCA) review of all assets. This includes a review of the impact of the asset on operating expenses. Such a review may indicate that an asset should be replaced earlier to improve or maintain service levels and minimize costs. Ongoing service level reviews through performance measures, targets and time frames such as the number of service calls to correct leaking stand pipes in a building per year and the results of the corrections. Ongoing control and review of capital and operating spending. Properly designed rehabilitation and replacement practices. Continuous focus on service which assets are most critical to service delivery? Efficient, uniform practices in dealing with different assets. Prioritization of investment to address critical assets first. Halton Region Asset Management Plan

110 4.2 External Trends and Issues External trends and issues affecting desired LOS or the Region s ability to meet the desired LOS include the following. AODA (Accessibility for Ontarians with Disabilities Act) Industry design guidelines Building codes, standards and regulatory requirements Municipal bylaws Funding restrictions and funding scenarios Faulty original construction design Emergencies/reactive situations Demand maintenance Predictive maintenance Preventative maintenance Life cycle management Climate impacting the asset Delays in procurement process Growth in the Region with additional assets Technology improvements Sustainability greening trends Industry trends The trends and issues listed above are reviewed on a regular basis to ensure any impact to the LOS is addressed on a timely basis. 4.3 Asset Performance A comprehensive approach to asset management involves processes for managing and maximizing the performance of an asset while minimizing its costs throughout the course of its lifecycle. Asset lifecycle activities therefore enable the Asset Management Division to make better decisions throughout the whole lifecycle and not just to focus on capital/infrastructure solutions. This approach considers a range of parameters, for example, age, condition, historic performance, current capacity etc. Key components of the Asset Management Division Lifecycle Management Framework include: Planning o Plan and monitor activities of the assets, Life Cycle Cost Analysis (LCCA), risk assessment Operational Strategies Halton Region Asset Management Plan

111 o Including considering non infrastructure solutions to mitigating risks, deferring the need for upgrades/renewals, asset utilization & demand management and Emergency Response Planning o Operate and inspect assets for optimized decision making that includes risk based approaches, multi-criteria analysis approaches along with approaches to optimizing investment Maintenance Strategies o Maintaining and repairing assets including approaches for determining the optimal mix of planned and unplanned maintenance and for carrying out maintenance performance assessments & reviews Investment Planning Strategies o Including the identification and scoping or projects to address capital work, maintenance, enhanced LOS, legislative requirements, growth including development and efficiency needs Capital Works Strategies o Design, build and improve assets Through the performance of the Asset Life Cycle Asset Management, data will be developed that will identify the following. Performance of the asset (budget vs. actual, quality and performance) Condition of the asset (asset value, cost of service, depreciation) Reason for failure of the asset (probability and cause, consequences of failure) Criticality of the performance or failure of the asset (asset interrelationships, impact on other assets) Clear connectivity of the Strategic Plan and Citizens Priorities to the daily activities of the Region Higher performance level Lower total costs Greater consistency Increased confidence and credibility Optimized decision making through costs, risks, performance and sustainability Details relating to asset performance and any relating assumptions are housed in the BCAs and the CPS. Asset performance indicators inform the Asset Management Strategy described in the next section by providing information to prioritize projects in accordance with set priority criteria. Halton Region Asset Management Plan

112 5 Asset Management Strategy 5.1 Life Cycle Costs and Options Analysis Life Cycle Cost Analysis (LCCA) assesses the total cost of ownership for a piece of equipment, a building addition, a renovation, or other expenditure. LCCA is defined as a method for evaluating all relevant costs over the performance life of a project, product or facility along with the environmental assessment of the asset. This technique for assessing the environmental aspects and potential impacts associated with an asset is performed by: Compiling an inventory of relevant inputs and outputs of an asset; Evaluating the potential environmental impacts associated with those inputs and outputs; and Comparing the results of the inventory and impact assessment phases to the objectives of the study of the asset LCCA is used to minimize the costs to the Region by comparing each option to alternative choices that are similar, yet different, in cost structures such as determining the cost effectiveness of purchasing triple-pane windows or double-pane windows. The LCCA takes into account: Data collection for an inventory analysis; First costs, including capital-investment, purchase, and installation costs; Future costs, including energy, operating, maintenance, capital-replacement, and financing costs; and Resale value, salvage value, or disposal costs over the life of the project, product, or facility. Future costs must be discounted and inflation must be incorporated when reviewing all options. For example, planned maintenance projects could use a standard inflation measure, while large capital projects may require a more specific measure that better reflects changes in construction costs. The AM Division reviews the following items when assessing options for Corporate Facilities and Social Housing assets: Direct Benefits and Costs a. Efficiencies and network effects such as savings in energy due to conservation and efficiency improvements to the equipment and building systems Halton Region Asset Management Plan

113 b. Investment scheduling to appropriately time expansion in asset life cycles (for example, delaying HVAC replacement until an addition to a building is required to save costs and minimize waste) c. Environmental impacts such as greenhouse gas emissions d. Vulnerability to climate change impacts or climate change adaptation Indirect Benefits and Costs a. Regional well-being and health b. Amenity values c. Value of culturally or historically significant sites d. Region s image 5.2 Risk Assessment The Asset Management Strategy includes an assessment of the risks associated with all potential solutions using an approach that allows for comparative analysis. Corporate Facilities and Social Housing asset failure is monitored by the following. A Set Risk Framework (objectives, stakeholders, criteria, key issues) Risk Identification (types of risks, internal/external, conditions) Determination of Consequences (costs, probability, ranking of risks, controls) Risk Mitigation (identifying options to reduce probability and impacts, quantity savings and improvement plan) Key risks and mitigation strategies associated with the AMP include the following. Failure impacting service delivery Program areas may stop providing services. Constant review of the service delivery is required. Not prioritizing critical assets Not following the Priority Criteria listed below would have assets failing sooner than expected and that may cause a disruption in the service delivery. Maintaining accuracy in detailing the priority of each asset on an on-going basis is critical. Lack of funding assets are not maintained or are maintained poorly leading to the possible complete failure of the asset. Business cases are built and alternative funding sources are sought where necessary. Improper maintenance impacting service delivery - Poor maintenance of the asset may lead to long-term damage to the asset possibly requiring emergency funding. Annual reviews of the maintenance plans are taking place. Health and Safety incidents - Asset failure may also lead to health and safety issues to those who use the asset. Health and Safety inspections take place on a regular basis. Halton Region Asset Management Plan

114 5.3 Project Prioritization The prioritization criteria developed by AM is as follows. Priority 1 - Essential - Currently Critical (Immediate) Conditions in this category meet code related statutory obligations and due diligence requirements and require immediate action to correct the problem. If left uncorrected, the problem increases the potential for serious or continued damage to buildings, building components, or infrastructure systems, and may negatively impact the facility s ability to deliver its program. Priority 1 projects can fall under the following categories: a) Life Safety and Legal Compliance a. Hazardous life safety building or site conditions that jeopardize people, programs, equipment; unless corrected will cause suspension of facility use; and b. Repairs, renovation and improvements required for immediate code compliance. b) Damage or Deterioration to Facilities a. Repairs, renovations and improvements to facilities that unless corrected will lead to a loss of a facility and higher costs to return to operation if not addressed; and b. Stop accelerated deterioration. c) Cost-effective Measures a. Repairs, renovations, and improvements required to prevent serious facility deterioration and significantly higher labour costs in if not immediately corrected; and b. Energy conservation to reduce consumption with a rapid return on investment. d) Return a facility to operation. Priority 2 - Necessary High - Potentially Critical (Year 1 or 2) This category represents a high operational risk and affects the operational capacity of the facility. Conditions in this category, if not corrected expeditiously, will become critical within a year or two and result in a major failure that will lead to major damage to a facility and loss of use. It will also lead to higher future replacement costs, hamper Program activities or affect economies of operation. Situations within this category include: Halton Region Asset Management Plan

115 a) Intermittent operations; b) Rapid deterioration; c) Potential life safety hazards; and d) Structural Integrity. Priority 3 - Necessary Medium Not Yet Critical (Year 3-5) This category includes managing the long-range integrity, operational capacity and presentation of facilities. Conditions in this category require appropriate attention to preclude predictable deterioration or potential downtime and the associated damage or higher costs if deferred further. Situations within this category include: a) Liability Concerns: Facility elements requiring early attention to remove potential issues relating to life safety, property damage or code requirements; b) Program and Operational Concerns: Actions necessary to meet the operational requirements of the facility and Program; c) Economy and efficiency measures: Projects that support program and operational objectives but deserve special attention because they will result in immediate or eventual cost savings; d) Deferred Capital: Projects that have been deferred, phased or the scope of work has been modified due to funding shortfalls or other reasons. Capital renewal is necessary for proper functioning of the facility. These are capital renewal projects that can be postponed for a short period of time; e) Anticipating Actions: Actions carried out in anticipation of longer range development including land acquisition, infrastructure elements and advance planning for capital projects; and f) Reduction in scope: Modify scope to a smaller scale or consolidate with other projects. Priority 4 - Necessary Low - Recommended Improvements No action is required at this time, but should substantial work be undertaken in contiguous areas, certain existing conditions may require correction. The projects in this priority can be deferred safely and economically and reassessed at a future date. Priority 5 - Desirable Conditions in this category include items that represent a sensible improvement to existing conditions to maintain the building from becoming physically or functionally obsolescent. These are not required for the most basic function of the facility; however projects will improve overall usability and/or reduce long-term maintenance costs. Situations within this category include energy conservation and cost initiatives which improve the operational efficiency of a property and which have a reasonable payback. Halton Region Asset Management Plan

116 5.4 Project Plans Project plans include the following components, where applicable. Non-infrastructure solutions such as feasibility studies and using an integrated approach to planning of infrastructure improvements to minimize cost and maximize service delivery. Clearly-defined preventative maintenance programs that include regularly-scheduled inspections, repairs and maintenance activities including those associated with unexpected events. Maintenance programs are monitored using an asset inventory in the Region s CMMS. (Appendix AM 11) Renewal/rehabilitation activities which are designed to extend the life of the asset. Replacement activities identified once an asset has reached the end of its useful life and renewal/rehabilitation is no longer an option. Disposal activities associated with disposing of an asset once it has reached the end of its useful life, or is otherwise no longer needed by the Region. The disposed asset is removed and logged out of the inventory of the Maintenance Plan. As well, the new item is added into the Maintenance Plan and into the Capital Plan with a new life cycle. Expansion activities to extend services to unserviced areas and service level increases to existing assets to meet the Region's growth demands. All growth is documented and the individual assets and building elements are included in the CMMS and CPS with life expectancies and maintenance requirements. The activities to be undertaken in the project plan are derived from information contained in the BCAs and the CMMS which assist in the options analysis and risk assessment. Halton Region Asset Management Plan

117 5.5 Procurement Methods Halton Region s Purchasing Bylaw and the Halton Community Housing Corporation Purchasing Bylaw guide all procurement practices. The Purchasing Bylaws are supported by related internal policies and procedures. The Purchasing By-laws are designed to provide fundamental support for Halton s governance and internal control frameworks. The by-laws establish standards for ensuring competitiveness, objectivity and fairness in the procurement processes. They also offer a variety of methods for purchasing goods and services to ensure the best procurement options are used and relating processes are managed consistently throughout the organization. Ultimately, the by-laws help to ensure the procurement decisions reflect best value. Key objectives of the bylaws are to: Encourage competitive bidding Ensure objectivity and integrity of the procurement process Ensure fairness between bidders Maximize savings for the taxpayers The full Halton Region Purchasing By-law is available on the Halton Region website. The HCHC Purchasing By-law is available internally. (Please refer to Appendix AM6 for an excerpt from the Halton Region Purchasing policy.) 6 Financing Strategy 6.1 Financing Plan Development The annual Capital Budget and 10-year forecast for Corporate Facilities and Social Housing assets is developed through the use of current BCA information and the asset life cycle forecast as described in Section 5 of this document. This process is documented in Appendix AM1. The developed Capital Budget that is brought forward for approval is made up of individual capital replacement work projects broken down into non-infrastructure solutions, maintenance activities, renewal/rehabilitation activities, replacement activities, disposal activities and expansion activities (if necessary). A comparison of the actual costs for the previous two to three years for similar or identical work is performed internally. The project work is classified and budgeted using the UNIFORMAT II Level Three structure for each individual asset. (Please see Appendices AM7 and AM8 for examples of detailed budget worksheets.) Halton Region Asset Management Plan

118 The AM Division works closely with staff from the Financial Planning and Budgets Division to prepare the Financing Strategy taking into consideration all available funding sources including the existing capital reserves and tax revenue. The Financing Strategy development is supported by the CPS which includes information such as funding required to keep the asset sustainable. The CPS also allows for the development of future what if scenarios for the Budget and Business Plan. This type of analysis takes into consideration both short-term and long-term solutions which allow for the repositioning of an asset in its life cycle, where necessary. A review of the impact on desired LOS is included as part of the analysis. Assumptions used are housed in the software and include items such as expected percentage increases in funding provided. Once the analysis is complete, a deferred project list is finalized. These projects are ranked as a lower priority and can be addressed in future years without affecting LOS. An example of such a list is included in Appendix AM3. The value of deferred projects included in the 2014 budget is $6,229, Current Financing Plan Summary The forecasted expenditures (in 000 s) for Corporate Facilities and Social Housing projects are: Corporate Facilities Project Type Replacement $23,259 $32,224 *Refer to pages D210 and D214 & D215 of the budget document for details Social Housing (HCHC) Project Type Replacement $3,217 $46,963 The forecasted funding sources (in 000 s) for Corporate Facilities and Social Housing projects are: Corporate Facilities Revenue Type Capital Reserves $23,259 $32,224 Social Housing (HCHC) Revenue Type Capital Reserves $3,217 $46,963 The figures above include projects for Region owned and managed assets. It should be noted that Social Housing stock is owned by HCHC and managed by the Region. The detailed Asset Management capital plan for Corporate Facilities forms a part of the overall Halton Region Budget and Business Plan. Halton Region Asset Management Plan

119 Corporate Facilities and Social Housing Footnotes A1 Asset Management Division maintains a comprehensive Asset Management Plan in hard copy (a binder is available with all Asset Management Plan details) and in electronic version. Halton Region Asset Management Plan

120 Corporate Facilities and Social Housing Appendices AM 1 Asset Management Capital Budget Development Halton Region Asset Management Plan

121 AM 2 Corporate and Social Housing Assets Infrastructure Condition Report Card Halton Region Asset Management Plan

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123 AM 3 Deferred Capital Budget Sample Halton Region Asset Management Plan

124 AM 4 Excerpts from TCA Policies for Facilities and Buildings Corporate Facilities; Asset Level of Detail Halton Region has inventoried each Building Facilities asset by breaking it into major building elements of process or discipline. These 8 major elements were developed based on Level 1 of UNIFORMAT II, which is a standard classification for building elements and related site-work. UNIFORMAT II, an enhanced version of original UNIFORMAT, was developed in 1993 in the USA and it is recommended by the Construction Specifications Institute/ Construction Specifications Canada (CSI/CSC) to structure schematic phase specifications, and by the Design-Build Institute of America for performance specifications. Table 2 below, shows these 8 major elements common to most buildings and their respective RIVA (Halton s TCA software) classifications. Each of the major elements is depreciated separately based on its own assigned useful life expectancy. Typical useful lives that are used are shown in Table 2. The useful life of each major element will have to be determined based on the weighted average useful lives of the UNIFORMAT II s Level 2 components. For the list of Level 2 components useful lives, please refer to the table the next page. Table 1 Corporate Facilities: Building Facilities Level of Detail Major Elements RIVA Assets Class RIVA Asset Type Substructure Shell Roof Interiors Services Equipment & Furnishings Special Construction and Demolition Building Site work General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements Typical Useful Lives Building Substructure 90 Building Shell Building Roof Building Interior 35 Building Services Building Equipment & Furnishing Building Special Construction Thresholds $10, $10, $10,000 See AM 5 for the detail list 35 Case specific Building Site Work 30 $10,000 $10,000 $10,000 $10,000 $10,000 Halton Region Asset Management Plan

125 HCHC Buildings; Asset Level of Detail HCHC has inventoried each Building Facilities asset by breaking it into major building elements of process or discipline. These 8 major elements were developed based on Level 1 of UNIFORMAT II, which is a standard classification for building elements and related site-work. UNIFORMAT II, an enhanced version of original UNIFORMAT, was developed in 1993 in the USA and it is recommended by the Construction Specifications Institute/ Construction Specifications Canada (CSI/CSC) to structure schematic phase specifications, and by the Design-Build Institute of America for performance specifications. For details refer to Appendix 2- Uniformat II. Table 2 below, shows these 8 major elements common to most buildings and their respective RIVA (HCHC s TCA software) classifications. Each of the major elements is depreciated separately based on its own assigned useful life expectancy. Typical useful lives that are used are shown in Table 2. The useful life of each major element will have to be determined based on the weighted average useful lives of the UNIFORMAT II s Level 2 components. For the list of Level 2 components useful lives, please refer to Appendix 2-Table B. Table 2 Social Housing: Building Facilities Level of Detail Major Elements Substructure Shell Roof Interiors RIVA Assets Class General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements General: Buildings/Building Improvements RIVA Asset Type Typical Useful Lives Thresholds Building Substructure 50 $10,000 Building Shell 50 $10,000 Building Roof 15 $10,000 Building Interior 25 $10,000 Services General: Buildings/Building Improvements Building Services See AM 5 for the detail list $10,000 Equipment & Furnishings General: Buildings/Building Improvements Building Equipment & Furnishing 20 $10,000 Special Construction & Demolition General: Buildings/Building Improvements Building Special Construction Case Specific $10,000 Building Site Work General: Buildings/Building Improvements Building Site Work 25 $10,000 Halton Region Asset Management Plan

126 AM 5 UNIFORMAT II Halton Region Asset Management Plan

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140 AM 10 Replacement Values Replacement cost estimates are based on the most recent insurance values. Halton Region Asset Management Plan

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149 The Regional Municipality of Halton Asset Management Plan Version PW-14069