Building Infrastructure Asset Management Plan

Building Infrastructure Asset Management Plan Version 1.1 Building Infrastructure Asset Management Plan (Version 1.1) Page 1 of 19

Document Control Council policy documents change from time to time and it is recommended that you consult the electronic reference copy at www.casey.vic.gov.au/policiesstrategies to ensure that you have the current version. Alternatively you may contact Customer Service on 9705 5200. Responsible Department Building Services Adopted 7 October 2008 Electronic reference library version 1.1 Preamble In accordance with a resolution of Council on 21 June 2005 to include definitions of Council, Councillors and Council officers in all Council policy documents, the following definitions are provided: Council means Casey City Council, being a body corporate constituted as a municipal Council under the Local Government Act 1989 Councillors means the individuals holding the office of a member of Casey City Council Council officers means the Chief Executive Officer and staff of Council appointed by the Chief Executive Officer. Building Infrastructure Asset Management Plan (Version 1.1) Page 2 of 19

Index Index... 3 Building Asset Management at the City of Casey... 4 Casey s Building Assets... 4 The Asset Management Plan... 4 Purpose of this Document... 5 Structure of the Asset Management Plan... 5 Building Infrastructure Key Issues... 6 Goals and Objectives... 6 Business Drivers... 6 Significant Issues... 6 An Integrated Management Approach... 7 Demand Trends... 8 The Building Assets... 9 Key Facts...9 Asset Condition and Performance Data... 10 Managing Risk... 11 Levels of Service... 12 Service levels for Building Infrastructure Assets... 12 Key Stakeholders... 12 Customer Expectations... 13 Financial Projections and Programs... 14 Asset lifecycle Management... 14 Operations and Maintenance... 15 Asset Renewals... 15 New Assets... 15 Additional New Capital Works... 16 Financial Projections... 17 Financial Sensitivity Analysis... 18 Service Potential and Asset Valuation... 18 Funding Implications... 18 Continuous Improvement... 19 Note This Asset Management Plan is a foundation document for buildings in the City of Casey. As data collection on buildings is consolidated a more precise document can be produced that will define more accurately the condition of existing buildings and create more accurate predictions of future building requirements and capital work programs. Building Infrastructure Asset Management Plan (Version 1.1) Page 3 of 19

Building Asset Management at the City of Casey Casey s Building Assets Building infrastructure assets contribute to the social, ecological and economic well-being of the community by providing buildings for Community Activities Passive and active recreation Corporate usage such as depots, offices, tips Public toilet facilities etc This Plan excludes sports grounds, playgrounds and other assets that are built in conjunction with Building assets. These ancillary assets are detailed in the Open Space Asset Management Plan. The Asset Management Plan The Building Infrastructure Asset Management Plan is a cornerstone document that guides the work of Council staff involved in Building infrastructure management. It will be reviewed regularly to provide assurance to Council, customers and other stakeholders that the Building Infrastructure assets that the City of Casey is responsible for are being managed efficiently and sustainable. The Asset Management Plan is an internal working document that provides a detailed and comprehensive reference for asset managers and other staff. The Asset Management Plan delivers a considered and planned approach to the long-term management of building assets. By providing a framework for optimising future expenditure to match the community s desired levels of service, the plan will assist the most efficient allocation of resources. This has the two key benefits of providing: The right service at the best value A business planning tool to maximise efficient use and management of building assets. The Asset Management Plan is a tactical Plan that links City of Casey s overall Council Plan objectives to the implementation of specific works programmes. A key output of the Asset Management Plan is the set of tactics used to determine maintenance standards and the nature and frequency of inspections for building assets. Customer Expectations Level of Service Cost Legislative Requirements Financial Environmental Strategic Planning Process (e.g. Council Plan, Leisure Strategy) Service Level Review Process Asset Management Plan This Document Summary Plan Implementation Plans (e.g. Annual Budget) Strategic Planning Tactical Planning Purpose of this Document Operational The purpose of this summary document Planning is to Building Infrastructure Asset Management Plan (Version 1.1) Page 4 of 19

Purpose of this Document Structure of the Asset Management Plan The purpose of this summary document is to present an overview so that Council can appropriately consider and adopt the Building Infrastructure Asset Management Plan 2008. It is also intended to provide a basis for expenditure levels for the next twenty years and, in combination with Council s other Asset Management Plans, provide a basis for the longterm financial strategy of Council. This document has been written to provide a simple, easy to understand overview of the City of Casey s Building Infrastructure Assets, the Levels of Service delivered by those assets, and the medium to long term financial requirements. An important objective is to provide sufficient information to enable Council and the community to fully understand the value of the services. This document therefore provides an important basis for ongoing consultation and information sharing. Levels of service that the Council is delivering on behalf of the community are determined by considering the needs and desires of those using the assets. These levels of service and a comprehensive risk assessment determine the inspection regimes and maintenance and renewal strategies. Key performance measures are used to enable Council to assess and monitor the sustainability of the assets. The Asset Management Plan also identifies growth issues and trends in the demand for services. The financial implications of each section of the Building Infrastructure Asset Management Plan are combined to define the long-term financial requirements for City of Casey. The Building Infrastructure Asset Management Plan includes an improvement programme to continually refine and improve asset management practices and processes. EXISTING DATA DATA COLLECTION / MEASURE PERFORMANCE Environmental Strategic LEVEL OF SERVICE Customer Financial Asset Management Plan PREDICT DEMAND ASSESS FINANCIAL IMPACTS (Cashflow) PREDICT MODES OF FAILURE RISK ASSESSMENT / PRIORITISATION TREATMENT OPTIONS AVAILABLE EVALUATE COSTS & BENEFITS ASSET MANAGEMENT PLAN Building Infrastructure Asset Management Plan (Version 1.1) Page 5 of 19

Building Infrastructure Key Issues Goals and Objectives The City of Casey Council Plan defines the Council s purpose: The City of Casey, through leadership and community partnership, will promote: city pride; consult, communicate and be accountable, foster community development, provide quality services, manage growth with balanced development, improve opportunities for learning, businesses and employment. The Council s detailed strategic objectives outlined in the Council Plan to support this mission statement include: ensure a clear understanding of community needs and priorities measure performance and report to the Community significantly enhance the efficiency and effectiveness of Council s services foster the creation of a safe, secure and healthy City maximise the contribution of developers to the provision of physical building assets planning and delivery of Council s capital works program advocate for the provision of public and private sector community assets maintain assets according to Asset Management Plans implement innovative strategies for ongoing maintenance investigate more cost-effective methods of maintenance The Asset Management Plan is a key tool to enable achievement of the above objectives for the Council s infrastructure assets such as building infrastructure. The primary goal of the Asset Management Plan is to: meet a required level of service in the most cost effective way (through the creation, operation maintenance, renewal and disposal of assets) to provide for existing and future customers Business Drivers Councils are required by the Local Government Act to consult with the community and consider the following when developing quality and cost standards: Best on offer in public and private sectors Value for money Community expectations and values Balance of affordability and accessibility Opportunities for local employment and growth Partnership building The Council has a legal and ethical responsibility to ensure a high standard of public safety at and around all building infrastructure under its control. Significant Issues As one of the fastest growing municipalities in Victoria, the City of Casey has the challenge of ensuring a large number of quality building and associated assets are constructed or acquired on behalf of the community in a timely manner, while providing a cost-effective service for the present community. Building Infrastructure Asset Management Plan (Version 1.1) Page 6 of 19

An Integrated Management Approach The Building Infrastructure Asset Management Plan has been developed using an integrated approach, as shown in the diagram below. Historical Expenditure Business Drivers and Service Standards Strategic Goals Building Facilities, Community Served Building purpose Component features Building size/capacity Quality/value Key Outputs / Outcomes Optimised Investment Performance / KPI s Strategic Outcomes Regulatory compliance Improvement Programme Community needs Management Strategies Risk Operations and maintenance Renewal and Development Environment / Sustainability Strategic goals are considered along with historical trends and infrastructure needs. These are integrated with key business drivers and service levels. Management strategies are defined, covering new investment, day to day programmes and risk. All of these are applied to create knowledge of the assets, both physical and financial. Key outputs and outcomes are defined to enable monitoring of the effectiveness of the plans. Building Infrastructure Asset Management Plan (Version 1.1) Page 7 of 19

Demand Trends There are approximately 75,000 households in City of Casey (Census 2006); double that of the same area 25 years ago. This trend is expected to slow, however Casey will continue to be one of the fastest growing municipalities in Australia with a further 37,000 households (50% increase) expected over the next 15 years. Number of Households City of Casey Household Projections 140,000 120,000 Historic Projected 100,000 80,000 60,000 40,000 20,000 0 1991 1994 1997 2000 2003 2006 2009 2012 2015 2018 2021 2024 2027 Year 2030 DSE Projections City of Casey Projections This growth component will lead to a corresponding increase in the building infrastructure that the City of Casey will be responsible for. The increased population will require a significant investment in building assets to develop the full potential of reserves, community and family facilities. The aerial photo shows the site of the new Cranbourne Aquatic and Leisure Centre as part of Casey Indoor Leisure Complex site on Berwick-Cranbourne Road. Other major development areas include Casey Fields sport and leisure facility located nearby. These regional facilities are often made possible by significant funding assistance from the State Government. Building Infrastructure Asset Management Plan (Version 1.1) Page 8 of 19

The Building Assets Key Facts The City of Casey s Building portfolio includes more than 700 building structures over the various City activities such as active and passive recreation, corporate, community and Family activities etc. The Buildings Infrastructure Asset Management Plan does not include open space assets that are constructed in association with the buildings as these are the subject of a separate Open Space Asset Management Plan. The classification of buildings is currently being reviewed by inspection and consideration of the buildings existing and possible future useage. Asset Description Number of Buildings Replacement Value 2006 ($ millions) Sport Pavilions 71 55.3 Pools & structures no of 3 facilities 28.2 Family Services 51 22.2 Office 13 20.0 Libraries 6 18.4 Community Centres 17 12.3 Halls 20 10.8 Senior Citizens 8 5.7 Public Toilets 44 4.0 Other Buildings (Sheds, 475 shelters etc) 16.6 Associated Building Inc. in Infrastructure above 11.0 Total value as at 30/6/2006 204.5 Replacement Value of Building assets as % of total building assets Senior Citizens 3% Shed 1% Shelter 1% Public Toilets 2% Family Services 11% Community Centre 6% Pool & structure 15% Depot 2% Hall 6% Housing 1% Pavilion 30% Other 2% Office 10% Landfill 1% Library 9% Building Infrastructure Asset Management Plan (Version 1.1) Page 9 of 19

Asset Condition and Performance Data Regular inspections and maintenance activities are undertaken to ensure building assets are kept in good condition. Nevertheless, assets deteriorate with time and overall condition inspections are undertaken every few years to assess their remaining useful life. There has been little need to replace Building assets in City of Casey to date, as significant development did not occur until the 1970 s. Less than one third of Council buildings were built prior to this date. The limiting criterion is not so much the structural condition, but a performance issue and the need to meet current standards and keep buildings up to a modern standard. Portfolio Age Profile 50% 45% 40% 35% % of Buildings 30% 25% 20% 15% 10% 5% 0% 0-10 11-20 21-30 31-40 41-50 50+ Building Age Building Infrastructure Asset Management Plan (Version 1.1) Page 10 of 19

Managing Risk The City of Casey uses a framework based on the Australian standard AS/NZ 4360 to identify, evaluate and treat risks associated with its functions. Risk must be taken into account when making decisions for building operational, maintenance and capital works. Corporate Strategic risks are risks to the business as a whole and are managed through a corporate risk register. Strategic infrastructure risks are managed through the development of work programmes and strategies. Operational risks are managed on a dayto-day basis by staff and contractors through quality assurance, operating and safety procedures. Communicate and Consult 1. Establish the Context 2. Identify Risks 3. Analyse Risks 4. Evaluate Risks 5. Treat Risks Monitor and Review The corporate risk management goals, as defined in the Risk Management Plan for the period 2008 2010, are: Communication of the City Of Casey Risk Management Policy to all employees. Establishment of Business Continuity plans and formalisation of the process for design risk assessment to be undertaken at the design stage for all new structures. Rollout of the corporate risk management framework across the organisation including a policy, strategy and procedures for all Directors, Managers, staff, contractors and volunteers. Preparation of risk management plans by managers as part of the business planning process based on prioritised risks identified in their areas of responsibility. Development of appropriate KPI s to measure organisational performance of risk management objectives. Development of a risk register to house all data relating to identified, prioritised and treated risk. All Council owned buildings to have a contingency plan in place in the event that the building is destroyed. It is not always feasible to completely mitigate risks. As a response the City of Casey participates in the mutual insurance scheme currently managed by Civic Mutual Plus (CMP) and Jardine Lloyd Thompson. Council is subject to annual audits that review Council s risk management processes. The asset insurance audit is used as the basis of calculating Councils insurance premiums for buildings etc. Building Infrastructure Asset Management Plan (Version 1.1) Page 11 of 19

Levels of Service Service levels for Building Infrastructure Assets A level of service is the defined service quality for a particular activity or service area, against which service performance can be measured. Levels of Service must be meaningful and address the issues customers perceive to be important. Service levels developed for the City of Casey Building Infrastructure Assets are based on the following: Legislative Requirements: legislation, regulations, environmental Standards and Council by-laws. Technical: Australian Design Standards, State and/or Federal government sporting associations, and other codes providing minimum service parameters for building infrastructure delivery. Strategic and Corporate Goals: key directions and objectives that Council focus on to deliver current and future services. Community Expectations: information gathered from customers on expected quality and cost of services ordinarily from annual surveys and public consultation. Star Rating. Possible use for the future rating of buildings. Key Stakeholders The following principal groups that have an interest in the quality of services provided by building infrastructure have been identified: Community Unstructured and/or organised use of building facilities by local and other residents, groups and businesses. Sports clubs and organisations Use facilities formally and informally for events and training. Educational Institutions - Use active and passive building facilities. Developers Provide contributions and building infrastructure as a condition of development or to enhance land subdivisions. Regulators Department of Sustainability and Environment, Department of Planning and Community Development, State and Federal Government. Key Partners Neighbouring local government authorities, emergency services, utilities. Lessee - Use of Council premises for a fee, lease or on a contract basis. Joint use agreements. These are available for joint use of a number of facilities, mostly constructed on non City of Casey land. Building Infrastructure Asset Management Plan (Version 1.1) Page 12 of 19

Customer Expectations Consultation is a key to understanding expectations. This has included feedback from individual customer contact on a day to day basis, and the Council s annual satisfaction surveys, interviews with building users and focus groups. The City of Casey through its contractors and operational areas regularly surveys its assets to detect hazards and develop maintenance and capital works programs. Levels of Service have been defined for key issues affecting the City of Casey s Building Infrastructure Assets and are tabled below. Strategies to ensure that these are achieved are also listed. Characteristic Desired Outcome LOS Measure Strategies Location Facilities are easy to get to and centrally located Community input Health and Safety Responsivene ss To Requests Opportunity for community input into levels of service and major capital projects Building users and general public feel safe and secure in and around the building Responses are prompt, clear and work appropriately prioritised Quality Facilities provide a quality experience for all users Quantity Sufficient number of facilities for all appropriate activities Cost effectiveness Environmental Stakeholders get best value for money Improved energy efficiency rating Suitable off-street car parking provided at all appropriate facilities Opportunity for comment on this document, consulted on all major projects Audits demonstrate compliance with the maintenance contract and all relevant legislation and essential safety measures. 100% of requests responded to within 15 days Staff and contractors appropriately trained To be measured by resident survey and site facilities rating Satisfaction with facilities and distance to them to be measured by resident survey Utilization ratios Services cost-effective compared to other authorities Multi use and flexible building use All works on buildings comply with relevant legislation, publications, standards and specifications in regard to sustainable energy Ensuring access is well defined and suited to ease of traffic flow. Central facility to the area that it intends to serve Community level of service review to be completed Opportunity to comment on all major projects Hazard and condition inspections according to programme Risk minimised according to risk strategy Implement prioritisation and recording procedures Audit procedures Maintain building according to Operational Procedures Audit of a number of facilities and quantity and useage of same Best value reviews Level of Service review Review of capital works prioritisation process Install energy efficient fittings Install water useage saving devices Accessibility All buildings accessible by disabled persons Building audits Regular audits of all Council buildings and action areas of concern to maintain accessibility Community satisfaction survey of affected users. In Summary Critical Service Level Success Factors are: Value for money- Identifying levels of service that the community needs and can afford and develop the necessary funding plans and life cycle costing plans to provide the services. Acceptable risk profile-building assets to be maintained at a safe level and associated signage and equipment to be provided as needed to ensure public safety. Timely delivery of services-building assets to be maintained in a prompt and efficient manner that provides good value for money, eliminates risk and satisfies customers. Satisfied customers-understand community needs and translate these identified needs, expectations and priorities into outcomes that address community requirements and aspirations. Building Infrastructure Asset Management Plan (Version 1.1) Page 13 of 19

Financial Projections and Programs Asset lifecycle Management Asset management defines four main work categories. The difference between each is important, and it is necessary to monitor performance and expenditure in each area in order to be able to optimise future costs and to recognise changes in the capacity of the assets to perform their required function. The Asset Management work categories are: Operational: utilisation of assets, such as, cleaning, security, water, gas and electricity. These activities do not change the physical nature of the assets. Expenditure by the Council on assets that are not owned by the Council (e.g. lighting owned by a power company or a sports club) are also treated as an operational expense regardless of which category would apply to the respective organisation. Maintenance: Day-to-day work on building assets to keep them functioning at the desired service levels. Maintenance activity involves restoration of the asset such as painting, roof repairs, mechanical service repairs etc. Renewal: replacement or rehabilitation to original size and capacity of a building asset or a component of the asset. Renewals are capitalised, so that the cost can be depreciated over the future life of the asset. New assets: activities that create a building asset that did not exist previously, or extend an asset beyond its original size or capacity. New assets are also capitalised, but they increase the asset base rather than restore its capacity to perform. New works projects include new sport and recreation building facilities, family resources, community and leisure centres as well as building extensions and component upgrades etc. Asset Disposal: In addition, where asset disposal involves expenditure, this must also be accounted for, along with any residual value. The Building Infrastructure Asset Management Plan identifies the programmes that are needed to minimise the total expenditure on the building asset throughout its entire life. The diagram to the right shows how the long term costs typically far exceed the initial construction costs, and the timing of major works such as refurbishments or renewals is critical to economic efficiency. Cumulative Cost Disposal and Replacement Continued Maintenance Total Lifecycle Costs Refurbish Maintenance Create asset 0% Effective Life 100% Building Infrastructure Asset Management Plan (Version 1.1) Page 14 of 19

Operations and Maintenance The operations and maintenance budget for buildings is required to keep building assets functioning at the desired service levels. Operations and maintenance costs will in the future increase in proportion to the increase in asset base due to the number of new assets built or purchased or extensions to existing buildings. The cost of providing services that operate from leased and contracted out premises (eg. Casey Arc by the YMCA) are not included in these projections 20 year projected Maintenance and Operation expenditure $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 Maintenance Operations $1,000,000 $0 2007/08 2009/10 2011/12 2013/14 2015/16 2017/18 2019/20 2021/22 2023/24 2025/26 Asset Renewals A 20 year renewals strategy has been developed based on the age and condition of the existing buildings. There is clearly far more work required to be undertaken in this area to fully inspect each building. Particularly with regard to its expected life expectancy and assessment of a renewal strategy based on the age, use and condition assessment of the building and its components such as structure, foundations, fitout, mechanical services etc New Assets The City of Casey will also have to invest in new assets for growth and improvements to levels of service. The following table of the 20 year projected building capital works expenditure shows the overall capital works forecast for Councils building infrastructure including the proposed replacement/renewal program. Building Infrastructure Asset Management Plan (Version 1.1) Page 15 of 19

20 Year Projected Building Capital Works Expenditure $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 Cranbourne Aquatic & Leisure Centre Development Leisure Facilities & Development Plan- increased service level component New capital works- growth 2007/08 2009/10 2011/12 2013/14 2015/16 2017/18 2019/20 2021/22 2023/24 2025/26 Estimated Replacement /Renew of existing building assets (further component life rating required) The following main predictions are incorporated in the 20 year projected capital works expenditure. The projections include an average budget allowance of $5.5m per annum for capital works excluding replacement and renew projects. Whilst this differs a little from the 5 year capital plan for buildings, it is based on historical actual expenditure on an average basis for completed projects. The replacement/renew building works have been estimated based on current expenditure levels and projected levels that take into account life of the structure and component service requirements and current condition of the components if known, and will be subject to review in the short term. This review will require full condition assessments of all buildings and consideration of a more accurate prediction of the life of each building structure and components of the structure. The projections incorporate the growth and increased service level components of the recommendations of the Leisure Facilities and Development Plan (2007) prepared by Stratcorp Consulting that in part recommends an increase in the number of new sporting facilities that approximately doubles current provisions. This has been incorporated because of a perceived undersupply of facilities for the existing population. This represents a significant increase in the current levels of service that will need to be business case justified and weighed up against levels of service for the other services that Council provides, notwithstanding that some of the initial capital costs may be able to be recovered from other funding sources such as developer contributions and state and federal government. In addition to new assets funded through the Council, some smaller building infrastructure assets such as rotundas and shade structures etc are expected to be added over the 20 year period through development, where developers construct leisure areas within the subdivision and vest them with the Council. Expected assets to be vested are difficult to predict as they are generally provided by developers to improve the amenity of the subdivision rather than being forced to by a condition of subdivision. Additional New Capital Works Extra capital expenditure will be required for the creation of additional buildings over and above the normal growth requirements. Project developments such as large tourist, arts, corporate and community centre buildings that are additional to the normal requirements for growth development will require one off fund injections into the municipal budget over and above the 20 year projected building capital works expenditure. These buildings will as a consequence when constructed increase the operational and maintenance requirements of the building budget. Building Infrastructure Asset Management Plan (Version 1.1) Page 16 of 19

Financial Projections Proposed long term financial projections based on a minimum 20 year timeframe have been developed from: Levels of service ( current and potential increase in service level) An analysis of the likely growth in population and household distribution and the resulting demand created. An assessment of the risks (eg asset failure, natural hazards) that the assets are exposed to, and the possible mitigation measures. Recognition of lifecycle asset management needs. A review of historical cost trends. Projected increases in expenditure for operations, maintenance, replacements/renewals and new works are aggregated in the chart below. General building expenditure is expected to increase steadily over the next 10 years and then stabilise, due mainly to a projected increase in replacement & renewal costs. This will of course be determined more accurately when detailed building asset inspections are undertaken. Operations expenditure covers direct asset operational costs (e.g. electricity, gas, water, cleaning and security costs) but excludes planning, financial charges, asset information systems, and the cost of providing council services from the buildings. Operations and Maintenance costs are projected to increase in proportion to the increase in buildings asset base. No allowance is made for the operation costs of the Casey Arc or new Cranbourne Aquatic and Leisure Centre as these are funded elsewhere with an income component. New Works expenditure does not include subdivisional building works constructed by developers, but does include improvement works for which a financial contribution or cost sharing mechanism applies.. New capital works on the basis of the leisure facilities and development plan will have an impact on future capital costs and operations and maintenance expenditure if the increased service level portion of the plan is adopted in whole or part. $40,000,000 $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 20 Year Building Financial Projections 2004/05 2006/07 2008/09 2010/11 2012/13 2014/15 2016/17 2018/19 2020/21 2022/23 2024/25 2026/27 Cranbourne Aquatic & Leisure Centre Development Leisure Facilities & Development Plan- increased service level component New capital w orks- grow th Estimated replacement/renew of existing assets Further rating of component life is required. Maintenance Operations The capital works expenditure includes the Cranbourne Aquatic and Leisure Centre costed separately for 2007/2008 and 2008/2009 as budgeted; the possible leisure facilities and development plan requirements to bring up the number of facilities per capita (increased service level); the normal capital works program for growth based on approx $5.5 m per annum and the estimated replacement /renew program. Prior to implementation of an increased replacement/renewal program in the future more accurate condition data is required for all Council buildings and their components. Building Infrastructure Asset Management Plan (Version 1.1) Page 17 of 19

Financial Sensitivity Analysis The financial forecasts are dependent on a number of key assumptions. Therefore if these prove to be incorrect or at variance, there may be an impact on the long term financial requirements. Furthermore, forecasts need to be constantly updated as more accurate information comes to hand or when significant changes in assumptions occur. The following events may result in a need to update financial forecasts: Shortfall between projected and available funding Revaluation of assets Review of asset lives Significant changes to the asset register Significant variance in growth forecasts Changes to adopted levels of service Changes in risk profiles Changes arising from the consequences of a natural disaster. The potential sensitivity of the financial forecasts to variability in the other parameters is required to be further explored. This will be an ongoing process as more detailed information and assessment is undertaken on the building assets. Service Levels The level of asset replacement and renewal will depend to a great extent on the levels of service required for the components of a building and the predicted life of said components. The current and future useage of a building will also have a bearing on whether components of the building are suitable for useage or whether replacement is required. Service Potential and Asset Valuation In accounting terms, the decline (or gain) in service potential is defined as the value of renewals less depreciation. It is a measure of the loss in value of the overall asset due to ageing that is not offset by replacing worn out assets or components with new equivalent assets. It therefore gives an indication of the liability that is being handed to the next generation. With the overall growth in new building assets over the period, the replacement value of the assets is expected to increase substantially. This includes new building assets installed and vested in the City from developers. The depreciated replacement value will also rise as the City of Casey grows, but will be balanced by the ageing of the assets. Funding Implications The cost of providing Building infrastructure is funded predominantly from rates revenue, with some capital works provided through state and federal funding for capital works. Part of the requirement for new assets will be funded by developer contributions. Other revenue includes lease returns, hire and entry fees which in many cases offset maintenance and operational costs. The cost to ratepayers to maintain the current level of service for Building infrastructure is expected to increase over the next 20 years due mainly to the need to provide more funds for renewal/rehabilitation of buildings (in 2007 dollars). More work is required to accurately determine this need by undertaking an inspection of buildings to establish predicted life remaining of the structure and components of the building. If the higher level of service recommended by the Leisure Facilities and Development Plan is adopted, further additional funding will be required for maintenance and operations of these buildings also. Building Infrastructure Asset Management Plan (Version 1.1) Page 18 of 19

Continuous Improvement Good practice asset management includes processes for continuous monitoring and improvement. The key asset management inputs required to support good asset management planning are: Processes: The necessary processes, analysis and evaluation techniques needed for life cycle asset management. Information systems: The information support systems, which support the above processes and which store and interrogate asset data. Data: Data available for interrogation by information systems to support asset management decision-making. The table below outlines the main improvements identified throughout the Building Infrastructure Asset Management Plan with actions proposed along with appropriate timeframes. ACTIVITY ACTION TARGET DATE Full review of the Building Infrastructure Asset Management Plan June 2008 and formal adoption by Council. Asset Management Plan Development Data improvement Review data integrity, obtain missing data and update asset register. Review condition assessment procedures and contracts for all buildings and commence data capture processes. Commence Maintenance Management System and record maintenance data against assets. Level of Service Review current level of service / performance measures using customer survey process and formally adopt. Measure actual level of service delivered and report in Annual Report. Investigate options to manage demand for assets eg through multi use facilities. Risk Review asset risk register to comply with corporate standards. Develop prioritised renewal programme based on risk and establish other risk minimisation strategies. Performance & Review capital works projections in conjunction with Leisure Asset Lifecycle Facilities and Development Plan. Financial Management Improved financial systems and processes to enable financial information to be readily and accurately reported against asset component group and expenditure classifications. December 2008 December 2008 December 2008 December 2008 December 2008 Asset Management Plan Review Committees of Management Review, update and improvement of the Building Infrastructure Asset Management Plan, implement independent peer review, adoption by Council of new Summary Document. Review quality controls, risk management, maintenance of building agreements, endeavours of committee, ensuring planning not compromised. October 2010 December 2008 G:\Organisational Strategy Projects\Policy Documents\Council adopted\building Infrastructure Asset Management Policy (Version 1.1).doc Building Infrastructure Asset Management Plan (Version 1.1) Page 19 of 19