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SECTION: Budget & Financial
EFFECTIVE DATE: May 27, 2024
RECOMMENDATION NO.: GC49-24
COUNCIL APPROVAL: 84-24
SUBJECT: Strategic Asset Management
POLICY NUMBER: Budget&Financial-18
1.
Policy Statement
1.1.
The Town of Huntsville will implement an asset management program through all
departments to proactively manage its assets to identify and address infrastructure
investment needs based on sustainable levels of service the Town can provide to
the community in a cost-effective manner. The program will promote lifecycle and
risk management of all municipal infrastructure assets, with the goal of achieving
the lowest total cost of ownership while meeting desired levels of service.
2.
Objective
2.1.
This policy provides:
2.1.1.
Leadership in and commitment to the development and implementation of
the Town's asset management program;
2.1.2.
Guidance for the consistent and coordinated use of asset management
across the Town; and
2.1.3.
Guidance for logical and evidence-based decision making for the
management of municipal infrastructure assets that is in line with the
Town's strategic priorities and any federal and provincial regulatory
requirements.
3.
Scope
3.1.
This Policy applies to all Town departments, boards, committees, working groups
and other organizations falling within the reporting requirements of the Town of
Huntsville and who oversee tangible capital assets.
4.
Definitions
The following definitions pertain throughout this policy:
4.1.
"Act" means the Infrastructure for Jobs and Prosperity Act, 2015.
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4.2.
"Asset" means economic resources controlled by the Town as a result of past
transactions or events and from which future economic benefits may be obtained.
The definition of this term is to remain consistent with that of the Town's Tangible
Capital Asset Policy.
4.3.
"Asset Management (AM)" means the coordinated activity of an organization to
realize value from assets. It considers all asset types, and includes all activities
involved in the asset's life cycle (from planning and acquisition/creation to
operational and maintenance activities, rehabilitation, and renewal, to replacement
or disposal and any remaining liabilities). It is a structured approach to managing
assets that involves balancing costs, risks & service levels in alignment with
community expectations and regulatory requirements.
4.4.
"Asset Management Governance" means a mechanism that provides assurance
through organizational oversight that assets consistently realize over the long-
term. The Town has established a corporate asset management governance
structure that defines roles and responsibilities of Council and staff from various
departments and service areas involved in developing and implementing its asset
management program.
4.5.
"Asset Management Plan (AMP)" means documented information that specifies
the activities, resources, and timescales required for an individual asset, or a
grouping of assets, to achieve the organization's asset management objectives.
Under O. Reg 588/17, asset management plans are required to include the current
service levels and key performance indicators for each asset class; their
replacement cost, average age, condition, and condition assessment protocols;
lifecycle activities required to maintain current levels of service; discussion of
population and economic forecasts; and documentation of processes to make
inventory- and condition-related background information available to the public.
4.6.
"Capitalization Threshold" means the minimum dollar amount that is used to
assist in determining which expenditures will be capitalized as tangible capital
assets. Capitalization threshold definition and values are in accordance with the
Town's Tangible Capital Asset Policy.
4.7.
"Green Infrastructure Asset" means an infrastructure asset consisting of natural
or human-made elements that provide ecological and hydrological functions and
processes and includes natural heritage features and systems, parklands,
stormwater management systems, street trees, urban forests, natural channels,
permeable surfaces and green roofs.
4.8.
"Level of Service" means key performance indicators and qualitative statements
that reflect social, political, environmental, and economic outcomes that the Town
delivers. These can include, not are not necessarily limited to, safety, customer
satisfaction, quality, quantity, capacity, reliability, responsiveness, environment,
climate change mitigation and adaptation, and financial sustainability.
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4.9.
"Lifecycle Activities" means activities undertaken with respect to a municipal
infrastructure asset over its service life, including constructing, maintaining,
renewing, operating, and decommissioning, and all engineering and design work
associated with those activities.
4.10. "Municipal Infrastructure Asset" means an infrastructure asset, including a green
infrastructure asset, directly owned by the Town or included on the consolidated
financial statements of the Town.
4.11. "Tangible Capital Asset" means assets with a useful life of longer than a year that
is not intended for sale in the regular course of the Town's operations.
5.
Strategic Alignment
5.1.
The Town's mission of 'delivering quality services for the people of Huntsville
through responsible decision-making' requires alignment of the many initiatives
underway in the Town at any time in order for it to be achieved. This alignment is
necessary to properly consider whether the level of service provided by the
existing and planned assets is consistent and supports the Town's mission.
5.2.
Asset management planning, therefore, will not occur in isolation from other
municipal goals, plans and policies. An integrated approach will be followed to
successfully develop practical asset management plans that align with the
overarching accountabilities and goals of the Town.
5.3.
As this policy is reviewed and updated, it shall be revised to align with emerging
and evolving strategies and actions that foster the integration of municipal
documents such as:
5.3.1.
Strategic Plan
5.3.2.
Official Plan
5.3.3.
Development Charges Background Study
5.3.4.
Various Master Plans
5.3.5.
Others plans adopted by Council and all relevant government legislation
and policies.
5.4.
Following updates or material changes to any of the documents listed above, the
Town will consider potential impacts on the AMP to ensure continued alignment.
6.
Key Principles
6.1.
The Town shall consider all infrastructure planning principles, as laid out in Section
3 of the Act, when making decisions regarding asset management.
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7.
Guidelines
7.1.
The Town will implement continuous improvement protocols and adopt best
practices in asset management to:
7.1.1.
Develop and maintain complete and accurate financial, risk and
performance data on all Town infrastructure assets;
7.1.2.
Adopt corporate asset condition rating and performance rating criteria,
and conduct risk assessments to document potential consequences of
service failures for cross-departmental ranking of local infrastructure
asset priorities;
7.1.3.
Manage current and future asset lifecycle activities while leveraging
opportunities to apply climate change mitigation, resiliency, and
adaptation lens in a fiscally responsible manner;
7.1.4.
Identify existing service levels and set sustainable target levels while
balancing costs, risks, community expectations and regulatory
requirements; and
7.1.5.
Integrate asset management with budgeting and long-term financial
planning.
7.2.
The Town will develop and maintain an asset inventory of all municipal
infrastructure assets which includes:
7.2.1.
Unique ID
7.2.2.
Description
7.2.3.
Location information
7.2.4.
Value (both historical and replacement)
7.2.5.
Performance characteristics and/or condition
7.2.6.
Estimated remaining life and estimated repair
7.2.7.
Rehabilitation or replacement date
7.2.8.
Estimated cost of repair, rehabilitation, or replacement
7.3.
The Town will develop an asset management plan (AMP) that incorporates all
infrastructure categories and municipal infrastructure assets that are necessary to
the provision of services. The scope of these assets will be determined in
accordance with the Town's Tangible Capital Assets policy in conjunction with the
professional judgement of staff. The AMP will be reviewed regularly to address the
Town's progress in implementing its asset management plan and updated at least
every five years in accordance with O. Reg 588/17 requirements, to promote,
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document and communicate continuous improvement of the asset management
program.
7.4.
The Town will integrate asset management plans and practices with its long-term
financial planning and budgeting strategies. This includes the development of
financial plans that determine the level of funding required to achieve short-term
operating and maintenance needs, in addition to long-term funding needs to
replace and/or renew municipal infrastructure assets based on full lifecycle
costing.
7.5.
The Town will develop meaningful performance metrics and reporting tools to
transparently communicate and display the current state of asset management
practice to Council and the community.
7.6.
The Town exemplifies its commitment for acting on climate change by leveraging
new and existing opportunities for reducing greenhouse gas emissions (mitigation)
and building resiliency to projected climate change impacts (adaptation) into
corporate asset management practices. Applying climate change mitigation and
adaptation lenses will be achieved by strategically embedding tactical, operational,
and reflexive considerations related to climate change into lifecycle management
practices for corporate assets. This will reduce vulnerabilities and promote
adaptation and resiliency to climate change impacts, incrementally over time. This
includes, but is not limited to, incorporating climate change considerations into
infrastructure design, risk assessments, anticipated operational costs, changing
levels of service, disaster planning and related contingency funding.
7.7.
The Town will align all asset management planning with the Province of Ontario's
land-use planning framework, including any relevant policy statements issued
under section 3(1) of the Planning Act; shall conform with the provincial plans that
are in effect on that date; and shall be consistent with all municipal official plans.
7.8.
The Town will coordinate planning for interrelated municipal infrastructure assets
with separate ownership structures by pursuing collaborative opportunities with
neighboring municipalities and jointly-owned municipal bodies wherever viable and
beneficial.
7.9.
The Town will develop processes and provide opportunities for municipal residents
and other interested parties to offer input into asset management planning
wherever and whenever possible.
8.
Responsibilities
8.1.
Council:
8.1.1.
Approve the Strategic Asset Management Policy, Asset Management
Plan, and direction of the asset management program.
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8.1.2.
Foster an asset management culture by maintaining adequate
organizational capacity to support the core practices of the AM program.
8.1.3.
Approve target service levels and capital investment priorities by
considering recommendations in the asset management plan.
8.1.4.
Review annual progress of asset management and its implementation
throughout the capital budgeting processes.
8.1.5.
Prioritize effective stewardship of assets in adoption and ongoing review
of policy and budgets.
8.2.
Senior Leadership:
8.2.1.
Provide corporate oversight to goals and directions and ensure the AM
program aligns with the Town's Strategic Plan.
8.2.2.
Ensure that adequate resources are available to implement and maintain
core AM practices.
8.2.3.
Provide staff coordination for participation on the Asset Management
Committee and/or in the ongoing AM practices within departments.
8.3.
Asset Management Committee:
The committee consists of the executive lead and staff in each department or
service area at the Town.
8.3.1.
Endorse the asset management policy and asset management plan along
with corporate asset management strategies and frameworks to ensure a
consistent and standardized approach to asset management at the Town.
8.3.2.
Review progress in implementation of the AM program to identify
challenges and propose potential solutions.
8.3.3.
Assist in the development of the Strategic Asset Management Policy.
8.3.4.
Review sustainability of current service levels.
8.3.5.
Assist in the coordination and tracking of AM program implementation,
continuous improvement, and progress.
8.3.6.
Track, analyze and report on AM program progress and results.
8.4.
Executive Lead:
8.4.1.
Manage Strategic Asset Management Policy.
8.4.2.
Provide organization-wide leadership in AM practices and concepts.
8.4.3.
Coordinate and lead the Asset Management Committee.
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8.4.4.
Coordinate and track AM program implementation, continuous
improvement, and progress.
8.4.5.
Track, analyze and report on AM program progress and results.
8.5.
Staff:
8.5.1.
Utilize the business processes and technology tools developed as part of
the AM program.
8.5.2.
Assist in the establishment of levels of service and monitor levels of
service on an ongoing basis.
8.5.3.
Provide support and direction for AM practices within their department.
8.5.4.
Assist in tracking, analyzing, and reporting on AM program progress and
results.
9.
Policy Review
9.1.
Town staff may automatically update this policy for minor and administrative
amendments, should they be required.
9.2.
This policy shall be reviewed every five years.