Village of Newbury Asset Management Plan

Village of Newbury Asset Management Plan 7 Candle Crescent, Kitchener Ontario, N2P 2K7 www.4roads.ca

7 Candle Crescent, Kitchener Ontario, N2P 2K7 May 14, 2014 Village of Newbury 22910 Hagerty Road, PO Box 130, Newbury, Ontario, N0L 1Z0 Attention: Subject: Ms. Betty Gordon, Clerk Treasurer Village of Newbury, Asset Management Plan Dear Ms. Gordon, 4 Roads Management Services Inc. (4 Roads), on behalf of CIMA+, is pleased to provide this Asset Management Plan to the Village of Newbury. Report information and analysis is drawn from the following documents: 2013 Road Needs Study Report Stantec Consulting 2013 York Street Drainage Improvements, CIMA Canada, 2013 State of the Infrastructure, CIMA Canada, 2014 The Asset Management Plan references the above noted documents. Content is only repeated in this document as required. Given the nature of the Village of Newbury, we have adopted a simpler approach that we believe would better serve the provincial intent of requiring and Asset Management Plan without necessarily fulfilling all of the requirements. We trust that the information provided in this report will be beneficial to the Village of Newbury in the continuing evolution of their Asset Management Plans. Please do not hesitate to call or email if you require any further information or discussion on any aspect of the report. Thank you for the opportunity to prepare this report. If 4 Roads Management Services Inc. may be of any further service, please do not hesitate to contact the undersigned. Yours truly, David Anderson, CET President, 4 Roads Management Services Inc. Dave.anderson@4roads.ca 519 505 5065 Cc Tom Montgomery, P.Eng, Vice President Municipal Infrastructure, CIMA Canada Stuart Winchester, P.Eng, Partner, Manager, Municipal Infrastructure

Village of Newbury Asset Management Plan 7 Candle Crescent, Kitchener Ontario, N2P 2K7 www.4roads.ca

Executive Summary In the fall of 2012, the Province of Ontario, introduced a requirement for an Asset Management Plan (AMP) as a prerequisite for municipalities seeking funding assistance for capital projects, from the province; effectively creating a conditional grant. To qualify for future infrastructure grants, an AMP has to be developed and approved by a municipal council by December 31, 2013. On April 26, 2013 the province announced that it had created a $100 million Infrastructure Fund for small, rural and northern municipalities. The province requires AMP s for Roads Structures, Water Collection and Distribution Facilities, Waste Water Collection and Treatment Facilities and Social Housing. The Village of Newbury (VoN) has responsibility for the local roads, water and waste water collection and distribution and waste water treatment. The VoN does not have any bridge or culvert structures with a greater than 3m span. Accordingly, the scope of this plan includes all of the aforementioned assets. Project Overview and Approach The Village of Newbury is located in Middlesex County in South West Ontario. The Village has very limited resources, both financial and staffing; the population is 439, and only one employee. The approach to this project is predicated upon these circumstances and as such, represents a higher level approach to the development of an Asset Management Plan that recognizes the immediate physical deficiencies that have to be addressed in the ten year horizon, and provides recommendations for fuller development of other aspects of a plan. The following documents form the basis of the analysis and resultant plan: 2013 Road Needs Study Report Stantec Consulting, 2013 York Street Drainage Improvements, CIMA Canada, 2013 State of the Infrastructure, CIMA Canada, 2014 The scope of this report is to develop an AMP following the provincial guidelines producing an AMP with the following content 1. Executive Summary 2. Introduction 3. State of Local Infrastructure (SotI) 4. Desired Levels of Service 5. Asset Management Strategy 6. Financing Strategy i

In order to develop the AMP, the following approach was adopted 1. Review of documentation that has been developed. 2. Development of Draft Asset Management and Financing Strategies 3. Village of Newbury staff review and comment on Draft 4. Presentation of Draft AMP to Council 5. Revision / Finalization of Asset Management and Financing Strategies 6. Final Report preparation 7. AMP presentation to, and adoption by, Council State of the Infrastructure (SotI) CIMA prepared a SotI Report Card in January 2014. The CIMA report integrates the findings of the Roads Needs Study, (Stantec Consulting 2013) with the other assets. The 2014 SotI provides an overview of the physical condition and replacement value of the assets the VoN is responsible for, in their entirety. The existing inventory data and condition ratings were used to develop programming and budgets. However, once an asset reaches the project design stage, further detailed review, investigation, and design will be required to address the specific requirements of each project. The York Street Drainage Improvements Report is an example of the detailed review and analysis that is required to reach the project stage. For road assets, data and road condition ratings were completed generally in accordance with the Ministry of Transportation Ontario (MTO) Inventory Manual for Municipal Roads from 1991 during a survey in the summer of 2013 (Stantec Consulting Newbury 2013 Road Needs Study). The remainder of the assets were evaluated in a report card format similar to what has recently been done by many different cities throughout Canada (such as Hamilton, Calgary, and Montreal). From the CIMA SotI report The methodology used in preparing this analysis was based on the methodology developed by the American Society of Civil Engineers, which periodically prepares such a Report Card for American public infrastructure. The SotI Report Card is shown as Table ES.1 immediately following the Executive Summary In very general terms, the road and storm water assets are in the poorest condition and the thrust of the asset management plan will be to upgrade/replace the storm sewer drainage infrastructure in conjunction with the roads program over the next 10 years. The water and waste water and waste water treatment assets are relatively new and are believed to be in good condition. The 2013 Road Needs Study (Stantec 2013) identifies that most road sections require drainage as there is minimal storm sewer servicing provided and most roads are built to a semi urban standard. The pavement condition itself is in fair condition, and could be sustained through regular resurfacing. However, the resurfacing cycle would be shortened due to the impact of the road bases not being drained. Adopting that approach would also not resolve the flooding problems that have been identified. All Village of Newbury assets are in an Excel database. The 2013 Road Needs Study was developed in WorkTech Asset Manager Foundation and approximately 35 data fields were exported to Excel, ii

Asset Valuation The CIMA SotI report identified replacement costs for each asset group. That information has been supplemented with the addition of additional information and calculations that identify the life cycle and the annualized capital replacement costs. Asset Valuation and Annualized Replacement Costs Asset Category Replacement Cost Life Cycle Yrs Annualized Cost Water Linear $3,793,000 75 $50,573 Wastewater Linear $3,220,550 100 $32,206 Wastewater Facilities $5,305,000 40 $132,625 Stormwater Linear $3,453,800 100 $34,538 Roads Systems $3,885,150 50 $77,700 TOTAL Newbury $19,657,500 $393,150 Asset Management Plan (AMP) As noted in the SotI, in very general terms, the road and storm water assets are in the poorest condition and the thrust of the AMP will be to maintain the average condition of the road system and to upgrade/replace the storm sewer drainage infrastructure in the York Street area with the remainder of the road system being managed in a holding strategy (Overlay Program) over the next 10 years. The planned construction of an outlet for York Street and the reconstruction of the adjacent road sections will only occur if the VoN receives assistance from Provincial Infrastructure Grants. The York Street Drainage Improvements report (CIMA, 2013) provides a solution to the drainage problem immediately in the area of the York Street, from James Street to approximately 65m east of Tucker Street. The roads in that area are also in poor condition and have to be reconstructed. Notwithstanding the York Street Drainage Improvements report, the entire VoN appears to lack a comprehensive drainage plan. Going forward, a Stormwater Master Plan should be prepared for the entire Village. Financial Plan The financial plan/strategy is integral to the asset management plan. The supporting studies provide financial and costing information useful for the preparation of the long term plan; State of the Infrastructure Replacement Costs of the assets Road Needs Study Recommended improvements and associated costing for each asset and a calculated replacement cost for each asset (integrated into SotI) Road Needs Study Return on Investment analysis through a Performance model that integrates capital and maintenance activities based on the cost versus the improvement to the asset. York Street Drainage Improvements Specific cost calculations for the proposed storm sewer construction iii

4 Roads understands that although there are established water and sewer rates, the current rates are subsidized through the levy supported budget. The replacement cost of the asset is only one component of the total annualized costs to manage, operate and sustain the assets. The following graphic is excerpted from the Provinces Building Together Guide for Municipal Asset Management Plans document. With the water and waste water asset being in the earlier part of their life cycle, the Village has an opportunity to establish appropriate user rates now to ensure that sufficient reserves are developed to perform the maintenance and replacement of the assets. The Road Needs Study used a performance model to establish a Preservation Budget that integrates operation and maintenance activities with capital improvements by assessing the Return on Investment versus the cost of the improvement, and the effect on the condition of the asset. 4 Roads understands that currently, the Town of Newbury is debt free therefore there should be sufficient borrowing capacity to debenture the improvement costs identified in the 10 year plan. However, in reviewing the VoN 2012 FIR a number of issues are noted. In 2012 VoN recorded a deficit of approximately $103,000 based on full accrual accounting. Furthermore, there were no funds placed in reserves for future replacement of tangible capital assets. iv

2012 year end reserve levels are approximately Water $33,000, Waste Water $14,000 and General $44,000. Annual amortization for 2012 was Water $39,000, Waste Water $133,000 and General $40,000. VoN should consider making annual contributions to replacement reserves to ensure sustainable financing into the future. The 2012 FIR (Schedule 81) also indicates a maximum debt capacity of $583,000. This is based on a maximum annual debt payment limit of $131,000 (25% of own source revenues). While having capacity is beneficial, borrowing to the full capacity level would result in a major tax increase (Additional $133,000 on a base of $218,000). VoN should review its FIR debt capacity calculation as the 5 year term used in its calculation seems unreasonably short. The Asset Management Asset management strategies are critical to managing the performance of an asset group, more so, if funding is limited. Funding constraints should push the strategy toward those programs that extend the life cycle of the road by providing the correct treatment at the optimum time. For roads, resurfacing, rehabilitation, and preservation projects should be a higher priority than reconstruction projects. The objective is to keep the good roads good. In addition to the budgetary recommendations, the following recommendations are provided for the management of the road and structures inventories; 1. The Village should develop an Asset Management Policy that may be adapted to all assets as plans for the other assets are developed. 2. Consider the Asset Management and budget recommendations included in this report to further develop the longer term asset management plan in conjunction with a longer term financial plan. 3. A Rate Study should be undertaken for the water and waste water assets to ensure that the rates are sufficient to ensure long term viability of the water and waste water facilities. 4. The cycle for review of the road system should be continued, reviewing the entire system on a maximum four year cycle. 5. A Master Drainage Plan should be developed prior to reconstruction of the road network to ensure that there is a legal, adequate outlet. The plan should be completed with consideration to the Municipal Drain Systems. 6. Traffic counts should be undertaken to confirm the traffic volume and percentage of truck traffic on roads in order to have adequate geometric and structural design and Regulation 239/02 classification. 7. Annual budget adjustments should account for inflation and increases for each asset group. 8. Capital reserves should be established for the road assets. 9. Capital Reserves Should be established for the rate supported assets 10. The asset management plan should be reviewed and revised annually from both condition and financial perspectives. v

11. Programming for roads should be reviewed to ensure that resurfacing and preservation programs are optimized. 12. Traffic counts should be updated and repeated on a regular basis. The counting should include the percentage of truck traffic. vi

Summary Information Table ES 1: State of the Infrastructure Report Card (From CIMA SotI) Asset Category Mean Grade Trend Comment Water Linear B+ Wastewater Linear B+ Wastewater Facilities B+ Stormwater Linear C Roads Systems C Village Grade B This group of asset is globally in good condition, but its condition is anticipated to deteriorate in the next few years given the current practices and level of investment. There is adequate capacity, and limited service interruptions. All water lines do not have a sufficient investment level to maintain the current condition. All assets from this group are considered in very good condition. There is adequate capacity and no reported service interruptions However, there has been insufficient investment level to maintain the current condition, and it is anticipated that the system condition will deteriorate over time. The wastewater facilities are overall in good condition. Most of the components of the wastewater treatment plant seem in fair to good condition and have adequate capacity. Current maintenance practices appear to be keeping the facility on good condition. This group of assets is globally in fair to poor condition, and its condition is anticipated to deteriorate given the current practices and level of investment. The system has capacity constraints, and localized flooding has occurred during frequent storm event, resulting in flooded basements and property damage. All assets from this group are considered in fair to poor condition, and are anticipated to degrade within the next few years given the current practices and level of investment. Newbury s linear water and wastewater infrastructure is in good to very good condition, due primarily to the relatively recent construction of these works. The wastewater facilities are also in very good condition with adequate funding. The Village s linear stormwater system is in fair condition, but has capacity and performance issues. As a result of poor drainage, the Village s road network is being impacted, such that the road will need replacement much earlier than typically anticipated. Surface Type Table ES 2: Roadside Environment and Surface Type (Stantec 2013) Roadside Environment Rural Semi Urban Lanekm Cl km Lane km Cl km Cl km Total Lanekm Cl km % Total High Class Bit. asphalt 0.15 0.29 0.15 0.29 2.55% 2.55% Gravel 0.66 1.32 4.88 9.76 5.54 11.08 97.45% 97.45% Total 0.81 1.61 4.88 9.76 5.69 11.37 % of Total 14.16% 14.16% 85.84% 85.84% Lanekm vii

Road Classification Table ES 3: Roadside Environment and Functional Class (Stantec 2013) Roadside Environment Rural Semi Urban Lane Lanekm Cl km Cl km km Cl km Total Lanekm Cl km % Total 200 0.15 0.29 0.15 0.29 2.55% 2.55% 300 0.66 1.32 0.66 1.32 11.61% 11.61% C/R 0.12 0.25 0.12 0.25 2.16% 2.16% L/R 3.94 7.88 3.94 7.88 69.25% 69.25% LCI 0.82 1.64 0.82 1.64 14.44% 14.44% TOTAL 0.81 1.61 4.88 9.76 5.69 11.37 % of Total 14.16% 14.16% 85.84% 85.84% Lanekm Need Year Table ES.4: Condition by Road Class (Stantec 2013) MMS Class Total 4 5 Cl km Lane km Cl km Lane km Cl km Lane km NOW 0.41 0.83 1.22 2.43 1.63 3.26 1 5 0.12 0.24 0.12 0.24 6 10 0.25 0.49 3.55 7.09 3.79 7.58 ADEQ 0.15 0.29 0.15 0.29 Total 0.81 1.61 4.88 9.76 5.69 11.37 % of Total 14.16% 14.16% 85.84% 85.84% System Adequacy % 49.4 48.4 75.0 75.1 71.4 71.3 Good to Very Good % 49.4 48.4 72.5 72.6 69.2 69.2 viii

Table ES.6: Summary of Improvements by Time of Needs (Stantec 2013*) 1 to 5 6 to 10 ADEQ NOW TOTAL Imp. Class Imp ID Cl km Imp. Cost Cl km Imp. Cost Cl km Imp. Cost Cl km Imp. Cost Cl km Imp.Cost Const REC 1.24 853,329 1.16 755,949 2.4 1,609,278 Const RSS 0.12 191,159 0.36 565,511 0.47 748,704 0.95 1,505,373 Maint SD 1.95 0 0.15 0 2.1 0 Rehab R1 0.25 25,856 0.25 25,856 TOTAL 0.12 191,159 3.79 1,444,696 0.15 0 1.63 1,504,653 5.69 3,140,507 % of Total 2.11% 6.09% 66.66% 46.00% 2.55% 28.68% 47.91% *Revised to reflect changes to York Street Graph ES1: Remaining Service Life Road Structural Adequacy Rating vs. Length *Service life as it relates to pavement surface only Data is from the 2013 Study (Stantec) ix

Table ES 9: 10 Year Asset Management Plan and Financial Plan Year Improvement Type / Area 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Grand Total Roads and Storm Sewer Levy Supported CRK Crack Sealing 986 470 706 470 450 3,082 GRR2 add 150mm Gravel 6,107 6,107 12,214 R1 Resurface 50mm 25,856 24,183 23,109 11,192 22,798 22,328 129,466 REC Rural Reconstruction 91,083 91,083 RSS Reconstruct with Storm Sewers 211,000 203,200 190,000 604,200 SD York Street Outlet 155,500 155,500 SWMeng Storm Water Master Plan 50,000 50,000 Total Levy Supported 166,939 155,500 31,276 211,000 23,579 203,200 18,005 190,000 23,268 22,778 1,045,545 Water and Waste Water Rated Supported Water Linear Waste Water Linear Waste Water Treatment Total Rate Supported 0 0 0 0 0 0 0 0 0 0 Grand Total 166,939 155,500 31,276 211,000 23,579 203,200 18,005 190,000 23,268 22,778 1,045,545 Funding Capital Reserve Levy 5,000 5,000 Operating Budget Levy 75,968 52,870 31,276 71,740 23,579 69,088 18,005 64,600 23,268 22,778 453,172 Capital Reserve Rate 0 Operating Budget Rate 0 Provincial Grant (@66%) 85,971 102,630 139,260 134,112 125,400 587,373 Contibutions from Others 0 Grants 0 Gas Tax 0 Debentures 0 Total Funding 166,939 155,500 31,276 211,000 23,579 203,200 18,005 190,000 23,268 22,778 1,045,545 x

Contents INTRODUCTION AND BACKGROUND... 1 PROJECT APPROACH OVERVIEW... 2 ASSET CONDITION RATING METHODOLOGY... 3 3.1 Asset Condition Rating Methodology Roads... 3 3.1.1 Inventory Manual History... 3 3.2 Asset Condition Methodology Water, and Waste Water, Collection and Distribution and Waste Water Treatment... 4 STATE OF THE INFRASTRUCTURE (SOTI)... 5 4.1 State of the Infrastructure Roads... 5 4.2 State of the Infrastructure Water Linear (CIMA 2014)... 8 4.3 State of the Infrastructure Waste Water Linear (CIMA 2014)... 8 4.4 State of the Infrastructure Waste Water Treatment (CIMA 2014)... 9 RECORD OF ASSUMPTIONS TON, IMPROVEMENT AND REPLACEMENT COSTS... 10 REPLACEMENT COST VALUATIONS... 11 6.1 Replacement Cost Valuation Roads (Stantec 2013)... 11 6.2 Replacement Cost Valuation Water Linear (CIMA 2014)... 11 6.3 Replacement Cost Valuation Waste Water Linear (CIMA 2014)... 11 6.4 Replacement Valuation Storm Water Linear (CIMA 2014)... 11 6.5 Replacement Cost Valuation Waste Water Treatment (CIMA 2014)... 12 ASSET CONDITION ASSESSMENT AND PLAN UPDATES... 13 7.1 Condition Assessment Cycle Recommendation Roads... 13 7.2 Condition Assessment Cycle Recommendation Waste Water Linear... 13 7.3 Condition Assessment Cycle Recommendation Storm Water Linear... 13 7.4 Condition Assessment Cycle Recommendation Water Linear... 13 7.5 Condition Assessment Cycle Waste Water Treatment Facilities... 13 7.6 Asset Management Plan Updates... 13 LEVEL OF SERVICE (LOS)... 14 8.1 LOS Roads... 14 8.2 LOS Water and Waste Water... 14 PROGRAM FUNDING RECOMMENDATIONS... 16 9.1 Overview... 16 9.2 Budget Recommendations Roads... 17

9.3 Budget Recommendations Water and Waste Water, Collection, Distribution and Treatment... 18 9.4 Budget Recommendations Storm Sewers... 18 9.5 Performance Modeling Budget Effect on Road System Performance and Proposed Storm Sewer Upgrades... 19 9.5.1 Asset Management Plan and Strategy Analysis... 19 9.5.2 Performance Model Overview... 20 9.6 10 Year Program... 20 ASSET MANAGEMENT STRATEGY... 22 10.1 Asset Management Overview... 22 10.2 Priority Rating vs. Condition Rating Roads... 23 10.3 Cross Asset Integration and Project Prioritization... 24 FINANCIAL STRATEGY AND PLAN... 26 11.1 Financial Plan Overview... 26 11.2 Asset Management Plan / Financial Plan Decision Matrix... 27 11.2.1 Non Infrastructure Solutions... 27 11.2.2 Maintenance Activities and Renewal / Rehabilitation Activities... 27 11.2.3 Replacement Activities... 28 11.2.4 Disposal Activities... 28 11.2.5 Expansion Activities... 28 11.2.6 Funding Sources... 28 11.3 Asset/ Financial Plan... 28 RECOMMENDATIONS... 30 List of Tables Table 4.1: Surface Type Vs Roadside Environment... 5 Table 4.2: Functional Classification vs Roadside Environment... 5 Table 4.3: MMS Class and Time of Need... 6 Table 4.4: Road Improvement Needs... 6 Table 4.5: Water Linear (CIMA 2014)... 8 Table 4.6: Waste Water Linear... 8 Table 4.7: Waste Water Treatment (CIMA 2014)... 9 Table 6.1: Replacement Cost Valuations and Replacement Costs... 11 Table 11.1: Proposed AMP and Funding... 29

List of Figures Figure 4.1 Remaining Service Life Roads... 7 Figure 9.1: Asset Life Cycle Costs (Building Blocks, MOI 2012)... 16 Figure 9.2: 10 Year Program Annual Budget vs Average Budget... 18 Figure 10.1: Treatment Cost vs. Deterioration... 24 List of Appendices Appendix A: 10 Year Plan for Roads and York Street Drainage... Appendix B: York Street Outlet Plan...

Introduction and Background In the fall of 2012, the Province of Ontario, introduced a requirement for an Asset Management Plan (AMP) as a prerequisite for municipalities seeking funding assistance for capital projects, from the province; effectively creating a conditional grant. To qualify for future infrastructure grants, municipalities are required to develop an AMP that is approved by council by December 31, 2013. On April 26, the province announced that it had created a $100 million Infrastructure Fund for small, rural and northern municipalities. Accessing these funds requires an asset management plan. The province requires AMP s for Roads, Structures, Water and Waste Water treatment collection and distribution and Social housing. The Village of Newbury (VoN) has responsibility for the local roads, water and waste water collection and distribution and waste water treatment. The VoN does not have any bridge or culvert structures with a greater than 3m span. Accordingly, the scope of this plan includes all of the aforementioned assets. The provincial requirements for content of an AMP include; 1. Executive Summary 2. Introduction 3. State of the Local infrastructure 4. Expected Levels of Services 5. Asset Management Strategy and, 6. Financing Strategy The Village of Newbury is located in Middlesex County in South West Ontario. The Village has very limited resources, both financial and staffing; the population is 439, and only one employee. The approach to this project is predicated upon these circumstances and as such, represents a higher level approach to the development of an Asset Management Plan that recognizes the immediate physical deficiencies that have to be addressed in the ten year horizon, and provides recommendations for fuller development of other aspects of a plan. Key to the development of an AMP is a State of the Infrastructure (SotI) review of the asset or asset group. Understanding the composition and replacement and maintenance costs of an asset group is essential to development of an AMP. This report incorporates the condition information from the following documents; 2013 Road Needs Study Report Stantec Consulting, 2013 York Street Drainage Improvements, CIMA Canada, 2013 State of the Infrastructure, CIMA Canada, 2014 1

Project Approach Overview The VoN has been developing the background information for the preparation of the plan over the last 1 to 2 year period with the production of the Roads Needs Study, The State of the Infrastructure and the York Street Drainage Report. The provincial requirements for content of an AMP include are identified in Section 1 of this report. In order to develop the AMP, the following approach was adopted In order to develop the AMP, the following approach was adopted 1. Review of documentation that has been developed. 2. Development of Draft Asset Management and Financing Strategies 3. Village of Newbury staff review and comment on Draft 4. Presentation of Draft AMP to Council 5. Revision / Finalization of Asset Management and Financing Strategies 6. Final Report preparation 7. AMP presentation to, and adoption by, Council 2

Asset Condition Rating Methodology 3.1 Asset Condition Rating Methodology Roads The provincial requirements for AMP s include asset condition assessment in accordance with standard engineering practices. The road section reviews follow the methodology of the Ministry of Transportation Inventory Manual for Municipal Roads, 1991. The condition of the road system is mandated by provincial Legislation by the following: Municipal Act 2001, Section 44 (1).The municipality that has jurisdiction over a highway or bridge shall keep it in a state of repair that is reasonable in the circumstances, including the character and location of the highway or bridge. 2001, c. 25, s. 44 (1). Regulation 239/02 Minimum Maintenance Standards for Municipal Highways is a result of Section 44 3.1.1 Inventory Manual History From the 1960 s until the mid 1990 s, the Ministry of Transportation (MTO) required municipalities to regularly update the condition ratings of their road systems in a number of key areas. The process was originally created by the MTO, as a means to distribute conditional funding, on an equitable basis, between municipalities. The reports were referred to as a Road Needs Study (RNS) and were required in order to receive a conditional grant to subsidize the municipal road programs. After the introduction in the 1960 s by the MTO, the methodology evolved into the current format by the late 1970 s. The most current version of the Inventory Manual is dated 1991, and is the methodology used for this report. The practice was discontinued by a number of municipalities, when conditional funding for roads was eliminated in the mid 1990 s. To put this in a more current context, a Road Needs Study is essentially the State of the Infrastructure. A more detailed discussion on the Inventory Manual Methodology is included in the 2013 Road Needs Study (Stantec) 3

3.2 Asset Condition Methodology Water, and Waste Water, Collection and Distribution and Waste Water Treatment The condition and performance of all aspects of water and waste water collection, distribution and treatment is covered by Legislation and many Regulations. Standards for water and waste water quality are set out in: Safe Drinking Water Act, 2002 Ontario Regulation 169/03 (Water Quality Standards) Ontario Regulation 170/03 (Drinking Water Systems) Ontario Water Resources Act Environmental Protection Act The methodology used in preparing the analysis on the water and waste water infrastructure was based on the methodology developed by the American Society of Civil Engineers, which periodically prepares such a Report Card for American public infrastructure. The SotI report (CIMA 2014) indicates that this would be similar to the approach taken in other centres. A fuller description of the methodology is include in the CIMA SotI Report. 4

State of the Infrastructure (SotI) 4.1 State of the Infrastructure Roads The Road Needs Study (Stantec 2013) is a detailed account of the SotI for the road assets. The following information is excerpted from that report. Surface Type Table 4.1: Surface Type Vs Roadside Environment Cl km Total Lanekm Cl km % Total High Class Bit. asphalt 0.15 0.29 0.15 0.29 2.55% 2.55% Gravel 0.66 1.32 4.88 9.76 5.54 11.08 97.45% 97.45% Total 0.81 1.61 4.88 9.76 5.69 11.37 % of Total 14.16% 14.16% 85.84% 85.84% Lanekm Table 4.2: Functional Classification vs Roadside Environment Roadside Environment Rural Semi Urban Lanekm Cl km Lane km Cl km Roadside Environment Rural Semi Urban Total % Total Lane Lanekm km km Lane Lane Cl km Cl km Cl km Cl km Road Classification km 200 0.15 0.29 0.15 0.29 2.55% 2.55% 300 0.66 1.32 0.66 1.32 11.61% 11.61% C/R 0.12 0.25 0.12 0.25 2.16% 2.16% L/R 3.94 7.88 3.94 7.88 69.25% 69.25% LCI 0.82 1.64 0.82 1.64 14.44% 14.44% TOTAL 0.81 1.61 4.88 9.76 5.69 11.37 % of Total 14.16% 14.16% 85.84% 85.84% 5

Need Year Table 4.3: MMS Class and Time of Need MMS Class Total 4 5 Cl km Lane km Cl km Lane km Cl km Lane km NOW 0.41 0.83 1.22 2.43 1.63 3.26 1 5 0.12 0.24 0.12 0.24 6 10 0.25 0.49 3.55 7.09 3.79 7.58 ADEQ 0.15 0.29 0.15 0.29 Total 0.81 1.61 4.88 9.76 5.69 11.37 % of Total 14.16% 14.16% 85.84% 85.84% System Adequacy % 49.4 48.4 75.0 75.1 71.4 71.3 Good to Very Good % 49.4 48.4 72.5 72.6 69.2 69.2 Table 4.4: Road Improvement Needs 1 to 5 6 to 10 ADEQ NOW TOTAL Imp. Class Imp ID Cl km Imp. Cost Cl km Imp. Cost Cl km Imp. Cost Cl km Imp. Cost Cl km Imp.Cost Const REC 1.24 853,329 1.16 755,949 2.4 1,609,278 Const RSS 0.12 191,159 0.36 565,511 0.47 748,704 0.95 1,505,373 Maint SD 1.95 0 0.15 0 2.1 0 Rehab R1 0.25 25,856 0.25 25,856 TOTAL 0.12 191,159 3.79 1,444,696 0.15 0 1.63 1,504,653 5.69 3,140,507 % of Total 2.11% 6.09% 66.66% 46.00% 2.55% 28.68% 47.91% System Adequacy The system adequacy is the ration of the NOW need roads to the total system. This is a holistic measure, using the Inventory Manual Methodology, as needs are identified in six critical areas, not just the distress on the road surface. The current system adequacy is 71.4%. Physical Condition Physical condition is the Structural Adequacy rating multiplied by five to produce a rating of between 5 and 100. This is a measure of the amount of distress on the road however the scale is not linear. The current average Physical Condition of the road system is 62.5. 6

MPMP Good to Very Good The province requires annual reporting on the percentage of roads that are rated as good to very good. It has been assumed that the 6 10 and adequate roads are good to very good and this has been expressed as a percentage of the system. Good to very good roads represent 69.2% of the road system. Remaining Service Life Roads As indicated previously, the Time of Need is really a prediction model in terms of an estimate based on current condition to the time for reconstruction. The TON then also provides an estimate of the remaining life in the road system/section. The following figure summarizes the structural adequacy ratings of the road system and illustrates the estimated remaining service life of the road system. Figure 4.1 Remaining Service Life Roads Drainage Adequate drainage is critical to the performance of a road to maximize its life expectancy. Roads are designed, constructed, and maintained in order to minimize the amount of water that may enter, or flow over, the road structure. In the case of water flowing over the road, assessment must be made of the circumstances on a sitespecific basis. Factors that should be considered include the traffic volumes of the road section, economic impacts to the loss of the use of the road, upgrade costs, and risks. There is further detailed discussion on drainage in the Road Needs Study Report (Stantec 2013). 7

4.2 State of the Infrastructure Water Linear (CIMA 2014) Engineering staff currently from the CIMA firm have been providing engineering services while working for other firms to the Village of Newbury for approximately 20 years. Their role over that time period would be similar to that of Engineer of Record. As such, their knowledge of the water and waste water infrastructure is significant. Inventory analysis was been completed by extracting available data from Record Drawings provided by the Village. A detailed condition assessment of the linear water asset has not been undertaken and, as such, the condition assessment is age based only. The Water Mains are constructed of PVC material. Further detail is available from the State of the Infrastructure Report, CIMA 2014) Table 4.5: Water Linear (CIMA 2014) Grades Asset Category Asset Condition Performance Capacity vs. needs Funding vs. needs Mean Grade Trend Water Linear Water Lines Primary A A A D B+ Water Lines Secondary A A A D B+ B+ Hydrants A A A D B+ Service Connections A A A D B+ 4.3 State of the Infrastructure Waste Water Linear (CIMA 2014) Inventory analysis was been completed by extracting available data from Record Drawings provided by the Village. A detailed condition assessment of the linear waste water assets has not been undertaken and, as such, the condition assessment is age based only. The Waste Water sewers are constructed of PVC material. The low pressure force mains are constructed of HDPE. Further detail is available from the State of the Infrastructure Report, CIMA 2014) Table 4.6: Waste Water Linear Grades Asset Category Asset Condition Performance Capacity vs. needs Funding vs. needs Mean Grade Trend Wastewater Linear Sewer Pipes A A A+ D B+ Sewer Laterals A A A+ D B+ B+ Manholes A A A+ D B+ 8

4.4 State of the Infrastructure Waste Water Treatment (CIMA 2014) Further detail is available from the State of the Infrastructure Report, (CIMA 2014) on the Waste Water Treatment Facility and Pumping Station. Table 4.7: Waste Water Treatment (CIMA 2014) Grades Asset Category Asset Condition Performance Capacity vs needs Funding vs needs Mean Grade Trend Structure A A A+ D B+ Electrical & Control Systems A A A+ D B+ Headworks (screen & grit removal) A A A+ D B+ Wastewater Facilities Wastewater Treatment Plant Secondary Treatment Sequencing Batch Reactor Secondary Treatment Digester A A A+ D B+ B+ A A A+ D B+ B+ Phosphorus Removal A A A+ D B+ Tertiary Treatment (equalization & sand filtration) A A A+ D B+ UV Disinfection A A A+ D B+ Main Lift Station A A A+ D B+ 9

Record of Assumptions TON, Improvement and Replacement Costs For the road system, the methodology of this report is such that a number of the Inventory Manual itself forms the basis of a large number of assumptions in terms of; Dimensional requirements for the development of improvement and replacement costs Structural requirements based on road classification Time of needs based on the ratings and subsequent calculations For life cycle and performance modeling, Appendix B includes a description of the deterioration curves that were utilized for development of the asset management plan. For water and waste water infrastructure, assumption for replacement and life cycles are as shown Sections 6 of this report. 10

Replacement Cost Valuations Table 5.1 is from the SotI Report (CIMA2014), in part. Additional columns have been added to identify the anticipated life cycle and annualized capital depreciation based on that the replacement cost and the life cycle. Costs are in 2014 dollars. Table 6.1: Replacement Cost Valuations and Replacement Costs Asset Category Replacement Cost Life Cycle Yrs Annualized Cost Water Linear $3,793,000 75 $50,573 Waste Water Linear $3,220,550 100 $32,206 Waste Water Facilities $5,305,000 40 $132,625 Stormwater Linear $3,453,800 100 $34,538 Roads Systems $3,885,150 50 $77,700 TOTAL Newbury $19,657,500 $393,150 6.1 Replacement Cost Valuation Roads (Stantec 2013) The budget recommendations bear a direct relationship to the value of the road system. 4 Roads estimates the cost to replace the road system, to its current standard, at $3,885,150. This estimate is based on the Village s unit costs. The estimates are in accordance with the Inventory Manual and the Roadside Environment indicated in the database. The majority of the roads are indicated as Semi Urban, therefore storm sewer costs are not included in that estimate. Further detail on cost estimates is available in the Road Needs Study Report (Stantec 2013). 6.2 Replacement Cost Valuation Water Linear (CIMA 2014) The replacement values were calculated with the following unit costs: $5,250 /hydrant, $400,000/km for the primary distribution main, $300,000/km for the local watermains, and $150,000/km for water services. The replacement cost of the water linear infrastructure is $3,793,000. 6.3 Replacement Cost Valuation Waste Water Linear (CIMA 2014) The replacement values were calculated assuming the following unit costs: $5,000/manhole, $285,000/km for the laterals, $450,000/km for the sewer mains, and $250,000/km for the low pressure sewers. The replacement cost of the wastewater linear infrastructure is $3,220,550. 6.4 Replacement Valuation Storm Water Linear (CIMA 2014) The replacement values were calculated with the following unit costs: $5,000/manhole, $3,500/catch basins, and between $300,000 and $600,000/km for the storm sewer, depending on the pipe diameter. The replacement cost of the stormwater linear infrastructure is $3,453,800. 11

6.5 Replacement Cost Valuation Waste Water Treatment (CIMA 2014) The replacement value for the WWTP was calculated based on the 2003 cost with an allowance for escalation at 5% annually. The replacement cost for the lift station is based on current construction costs for similar stations. The replacement costs for Waste Water Treatment and Facilities is $5,305,000. 12

Asset Condition Assessment and Plan Updates 7.1 Condition Assessment Cycle Recommendation Roads 4 Roads would recommend a four year cycle maximum for review and update of road system condition ratings. 7.2 Condition Assessment Cycle Recommendation Waste Water Linear The gravity systems should be flushed and videoed every 10 to 15 years. The low pressure system should be pressure tested every 10 to 15 years 7.3 Condition Assessment Cycle Recommendation Storm Water Linear The systems should be flushed and videoed every 10 to 15 years. 7.4 Condition Assessment Cycle Recommendation Water Linear Water Valves should be exercised and inspected annually. Hydrant flows should be checked every 10 years 7.5 Condition Assessment Cycle Waste Water Treatment Facilities Waste water treatment facilities are complex facilities that include a number of different infrastructure types that have varying lifecycle. The waste water treatment facility should be reviewed every 5 years. 7.6 Asset Management Plan Updates The Asset Management Plan should be reviewed annually to update the condition and financial requirements to maintain the plan. This will ensure that fluctuations in market conditions and other circumstances may be incorporated into the plan. 13

Level of Service (LOS) Level of Service has a different meaning for different interests. For instance, the cost per unit may not have an impact to a ratepayer whose chief concern may be service delivery. Similarly, cost or expenditure per unit may not illustrate the condition of the asset to the end user. Further, municipalities are required to report on various Municipal Performance Measures (MPMP) 4 Roads believes that multiple service measures may be required to adequately relate the condition of an asset to the various user groups; condition, operating costs, and end user. The following sections identify various measurements of service of the road system 8.1 LOS Roads System Adequacy The system adequacy is the ration of the NOW need roads to the total system. This is a holistic measure, using the Inventory Manual Methodology, as needs are identified in six critical areas, not just the distress on the road surface. The current system adequacy is 71.4%. The System Adequacy should be 60% as a minimum. Physical Condition Physical condition is the Structural Adequacy rating multiplied by five to produce a rating of between 5 and 100. This is a measure of the amount of distress on the road however the scale is not linear. The current average Physical Condition of the road system is 62.5. The Average Physical condition should be 70 as a minimum MPMP Good to Very Good The province requires annual reporting on the percentage of roads that are rated as good to very good. It has been assumed that the 6 10 and adequate roads are good to very good and this has been expressed as a percentage of the system. Good to very good roads represent 69.2% of the road system. The good to very good roads should be 70% as a minimum. 8.2 LOS Water and Waste Water Water The LOS targets for the water system are to provide uninterrupted service and have zero boil water advisories. Waste Water The LOS for the Waste Water Collection System is ensure the system has zero exfiltration and infiltration and that the linear assets have regular inspections to ensure rehabilitation to the system occur at the optimum time. 14

Waste Water Treatment The LOS targets for the Waste Water Treatment system are: To be in compliance with the Certificate of Approval for operation of the plant. To have zero bypass events 15

Program Funding Recommendations 9.1 Overview Budgetary recommendations in this report do not include items related to development and growth. The Village should consider those items as additional to the recommendations in this report. Generally, that type of improvement or expansion to the system would be funded from a different source, such as Development Charges. Program funding recommendations are a function of the dimensional information, surface or material type, roadside environment, functional class of the individual assets and current unit costing. Recommended funding for an asset should ideally include sufficient capital expenditures that would allow the replacement of infrastructure as the end of design life is approached, in addition to sufficient funding for maintenance, to ensure that that full life expectancy may be realized. As a minimum, the funding level should be such the current average condition of the asset group may be maintained. The budget recommendations bear a direct relationship to the value of the asset group. Figure 9.1: Asset Life Cycle Costs (Building Blocks, MOI 2012) In general terms, the budget for any given asset should include all applicable expenses to sustain an asset over its life cycle, including capital, operating, depreciation, interest etc. Figure 9.1 illustrates the cost components that would be included in determining the life cycle cost. 16

There are alternate approaches that may be used to determine a budget that will sustain or improve the asset condition. For instance, a performance model that includes maintenance and capital improvements and treatments may also be used to develop a program and a sustainable budget. In reviewing the VoN 2012 FIR a number of issues are noted. In 2012 VoN recorded a deficit of approximately $103,000 based on full accrual accounting. Furthermore, there were no funds placed in reserves for future replacement of tangible capital assets. 2012 year end reserve levels are approximately Water $33,000, Waste Water $14,000 and General $44,000. Annual amortization for 2012 was Water $39,000, Waste Water $133,000 and General $40,000. VoN should consider making annual contributions to replacement reserves to ensure sustainable financing into the future. The 2012 FIR (Schedule 81) also indicates a maximum debt capacity of $583,000. This is based on a maximum annual debt payment limit of $131,000 (25% of own source revenues). While having capacity is beneficial, borrowing to the full capacity level would result in a major tax increase (Additional $133,000 on a base of $218,000). VoN should review its FIR debt capacity calculation as the 5 year term used in its calculation seems unreasonably short. There may be additional financing schemes available such as local improvements, municipal drain programs, grants, fundraising and all alternatives should be actively pursued. 9.2 Budget Recommendations Roads Based on the composition of the road system, budget recommendations have been developed for annual capital and maintenance programs as follows: $77,700 for the roads capital/depreciation, excluding resurfacing, based upon a 50 year life cycle. (this would be similar to the PSAB 3150 amortization value) $28,100 for annual hot mix resurfacing, based upon a 20 year cycle. $2,200 annually for crack sealing 4 Roads has created a number of performance modeling scenarios for this project. The models are tied to a series of deterioration curves and maintenance and capital treatments that are required a certain condition levels. The improvement types include crack sealing, resurfacing either one or two lifts, and reconstruction. The small size of the road system does not lend itself to a modeling scenario where the annual budget limit is the capital depreciation funding level. An annual budget cap of $77,000 would not permit the majority of projects to be completed as the reconstruction of a single block is typically greater than $77,700. Modelling to maintain the condition of the existing road system performs well. However, it will result in annual expenditures greater than the average in some years. For this reason 4 Roads recommends the creation of Capital Reserves for asset Groups. Figure 9.2 below illustrates the annual versus average funding requirements for the proposed 10 year plan. The program includes road improvements to maintain the overall system condition and construct a storm sewer and outlet on York Street. The details of the 10 year program are included in Appendix A of this report. 17

Figure 9.2: 10 Year Program Annual Budget vs Average Budget 9.3 Budget Recommendations Water and Waste Water, Collection, Distribution and Treatment The water and waste water systems are being treated collectively as together they form a complete cycle of delivery and collection and treatment of water. The Sustainable Water and Sewage Systems Act, 2002 came into force August 2007 that required that these utilities be supported by user fees or rates that would make the utility financially viable. However, it is understood that this didn t necessarily mean full cost recovery. 4 Roads understands that the VoN has established user rates for Water and Waste Water (WWW) and further understands that the WWW rates are subsidized by an annual contribution from the Levy supported budget. No further information, such a Rate Study, has been provided. Given that the WWW rates are subsidized through the tax supported budget, it is recommended that a rate study be undertaken to develop appropriate user rates for WWW. The rates should be developed based on a minimum 50 years of anticipated capital and operating costs. Figure 9.1 illustrates the factors that should be included in the development of an appropriate rate. 9.4 Budget Recommendations Storm Sewers The storm water systems in municipalities, for the most part, tend to tied directly to the road system. Regardless of roadside environment, the road allowance is typically designed to convey both major and minor events. The life cycle is typically the same as for the waste water conveyance piping. 18

In South West Ontario, the Drainage Act is used to create legal outlets, usually for farmland but it has been used to create outlets for developed lands also. 4 Roads understands that there is a number of municipal drains in the VoN and that this is the storm sewer asset that has been identified in the SotI Report (CIMA 2014). Generally, Municipal Drains are not designed to a municipal standard for storm water and are therefore much smaller in diameter than would be anticipated for drainage in an urban area. Further, municipal drains are typically constructed of pipes with a butt joint to allow groundwater infiltration (to drain farmland). Whereas the VoN appears to be serviced by a number of municipal drains, they do not provide the same standard of service as a storm sewer. As roads within the VoN are reconstructed the drainage system should be upgraded to a municipal standard. Under the Drainage Act, the parties benefitting from the drainage afforded by the drain pay in proportion to their benefit. This would be very similar to a rate supported system except the costs are not annualized, they are dealt with a required for maintenance and repairs. A Master Drainage Plan is recommended for the VoN and the servicing of developed land that is currently service by Municipal Drains be integrated into the Study. 9.5 Performance Modeling Budget Effect on Road System Performance and Proposed Storm Sewer Upgrades 9.5.1 Asset Management Plan and Strategy Analysis The asset management plan is a function of the strategy and available financing. The development process for all elements is iterative, concurrent and holistic on a number of levels. It is complex. The provincial guidelines for the preparation of an AMP indicate that the following must be considered; Options must be compared on Lifecycle cost the total cost of constructing, maintaining, renewing and operating an infrastructure asset throughout its service life. Future costs must be discounted and inflation must be incorporated. Assessment of all other relevant direct and indirect costs and benefits associated with each option. o Direct benefits and Costs Efficiencies and network effects Investment scheduling to appropriately time expansion in asset lifecycles Safety Environmental Vulnerability to climate change o Indirect Benefits and Costs Municipal wellbeing and costs Amenity values Value of culturally or historically significant sites 19