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Corporate Policy
05. Finance and Accounting
05.12 - Strategic Asset Management Policy
Purpose:
The Township of Warwick provides a wide range of services to the community that
require the ownership and responsible operation, maintenance and rehabilitation of
physical assets including land, buildings, equipment, transportation, drainage, sewer
and water infrastructure.
Asset Management (AM) is an integrated approach, involving all Township of Warwick
departments, to delivering value to the community through the effective management of
existing and new infrastructure assets.
The intent is to maximize benefits, reduce risk and provide satisfactory levels of service
to the community in a sustainable manner. Good asset management practices are
fundamental to achieving sustainable and resilient communities.
This policy outlines the fundamental asset management principles to be implemented
across the Township of Warwick.
Policy Statement:
The Township of Warwick aims to uphold the following policy statements in managing
its capital infrastructure:
1. The Township will implement a municipal-wide asset management program that will
promote lifecycle and risk management of the Township's capital infrastructure assets.
A primary goal will be to achieve the lowest total cost of ownership while meeting
desired levels of service. Levels of service (LOS) refer to the outcomes or service
attributes that the Township aims to deliver for its residents and can include both
technical and qualitative components.
Approved by: Council
on
January 21, 2019
Report No.:
F-01-19
Effective:
January 21, 2019
Reviewed:
Council
Amended:
N/A
Next Review:
July 1, 2021
Note(s):
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2. The Township will implement continuous improvement protocols and adopt best
practices regarding asset management planning, including:
i.
Comprehensive and Accurate Asset Data
ii.
Condition Assessment Protocols
iii.
Risk and Criticality Models
iv.
Lifecycle Management
v.
Financial Strategy Development
vi.
Level of Service Framework
3. The Township will develop and maintain an asset inventory of all municipal capital
infrastructure assets which includes unique ID; description; location information; value
(both historical and replacement); performance characteristics and/or condition;
estimated remaining life and estimated repair, rehabilitation or replacement date; and
estimated repair, rehabilitation or replacement costs.
4. The Township will develop an Asset Management Plan that incorporates all
infrastructure categories and municipal capital infrastructure assets as per the legislated
requirements. The capitalization threshold guidelines in the Township's Tangible Capital
Asset Policy will apply. The Asset Management Plan will address its core municipal
capital infrastructure assets by July 1, 2021 and all other municipal capital infrastructure
assets by July 1, 2023. The Asset Management Plan will be updated at least every five
years thereafter in accordance with O. Reg. 588/17.
5. The Township 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 capital infrastructure assets based on full lifecycle costing.
6. The Township will identify appropriate funding for its capital infrastructure and for
financing service delivery. This may include taxation or user fee revenues, grant
programs, debt-financing, public-private partnerships (P3), alternative financing and
procurement (AFP), or the shared provision of services.
7. The Township 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.
8. The Township will consider the risks and vulnerabilities of municipal capital
infrastructure assets to climate change and the actions that may be required, including,
but not limited to: anticipated costs that could arise from these impacts, adaptation
opportunities, mitigation approaches, disaster planning, and contingency funding.
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Impacts may include matters relating to operations, levels of service and lifecycle
management.
9. The Township will ensure that asset management planning is aligned with the
following financial plans:
i. Financial reports related to the Township's water capital assets, including any
financial plans prepared under the Safe Drinking Water Act, 2002; long-range
capital plans developed as part of an Asset Management Plan; and annual Water
Regulation and Rating By-laws.
ii. Financial reports related to the Township's wastewater capital assets, including
long-range capital plans developed as part of an Asset Management Plan; and
annual Wastewater Regulation and Rating Bylaws.
iii. 2009 Water & Wastewater Rate Study and subsequent updates to this study.
iv. Current Long Range Financial Plan and subsequent updates.
10. The Township will align 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 municipal official plans.
11.The Township will coordinate planning for interrelated municipal capital infrastructure
assets with separate ownership structures by pursuing collaborative opportunities with
neighbouring municipalities and jointly-owned municipal bodies wherever viable and
beneficial.
12. The Township will develop processes and provide opportunities for municipal
residents and other interested parties to offer input into the Township's asset
management planning, where appropriate.
13. The Township asset management plan will be developed and administered by the
Senior Management Team.
Scope:
The Township of Warwick owns a wide range of asset types that deliver services to the
people of the township. Each year the township may receive or construct new assets. In
addition, the Township of Warwick may rely on natural assets or other assets that it
does not own, in order to deliver services.
This asset management policy applies to the assets owned by the township. Where
service provision is supported by other assets not owned by the township, we will work
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collaboratively with those asset owners and promote the principles outlined in this
policy.
The Township of Warwick recognizes the importance of natural assets and will include
these in its inventories and asset management practices. Examples include water
bodies, wetlands and wildlife corridors.
Table 1 summarizes the services that the Township of Warwick provides, and gives
examples of the asset groups and asset types owned by the township that support the
delivery of those services.
Table 1:
Service provided to the
community (not an
exhaustive list)
Example of asset group
(not an exhaustive list)
Examples of asset types
(not an exhaustive list)
Potable water supply
Water infrastructure
Dams, reservoirs, pipes,
valves
natural assets
Wastewater collection and
treatment
Sewer infrastructure
Pipes, lift stations, manholes,
natural assets, treatment
plants
Flood protection
Drainage infrastructure
Pipes, culverts, chambers,
natural assets
Transportation
Transportation infrastructure
Roads, bridges, sidewalks,
traffic signals, street lighting
Recreational parks
Parks infrastructure
Playfields, playgrounds, trails
natural assets
Community facilities
Civic facilities
Buildings
Civic offices, public works
yard, fire and police
buildings, parkades,
recreational and cultural
buildings
Emergency response
Vehicles
Fire trucks, heavy
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equipment, snow ploughs
Support for departments to
serve the community
IT infrastructure
Hardware, SCADA,
telemetry, communication
equipment
Objectives:
Provide a Strategic Asset Management Policy to provide guidance with regards
to the Asset Management Plan of the Township of Warwick.
Principles:
Principle - Service Delivery
The Township will clearly define level of service objectives that balance community
expectations and regulatory requirements with risk, affordability and available
resources, and will do the following:
- Manage assets appropriately in order to efficiently and effectively deliver the defined
levels of service.
- Monitor and periodically review level of service objectives to ensure that they meet or
support community and council expectations and other strategic objectives.
The Township will ensure transparency and accountability to the community on service
delivery. This will include regular communications to council to share information on
service performance as well as technical information such as asset condition.
The Township will comply with all relevant legislative, regulatory and statutory
requirements.
The Township will implement an AM system that incorporates risk-based and
information-driven decision-making frameworks that appropriately consider the potential
impacts of asset failure on ongoing service delivery.
The Township will ensure that decisions regarding the need for new assets are made
with appropriate due diligence; and that these needs are evaluated with a focus on
service delivery to the community, and supported with a valid business case that
articulates costs and benefits.
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The Township will prioritize and direct resources and expenditure in order to deliver
levels of service and other community benefits at an acceptable level of risk.
Principle - Long-term Sustainability and Resilience
The Township's asset management decision-making will consider the needs of both
current and future generations and the potential challenges associated with changing
community demographics and expectations related to service delivery, as well as
potential modifications to legislative requirements.
The Township's asset management decision-making will consider the potential effects
of climate change and other environmental changes, and how the increased severity
and frequency of climatic events may directly affect levels of service. Where
appropriate, the Township will adopt a proactive approach to mitigating the potential
impacts of climate change.
The Township will consider sociocultural, environmental and economic factors and
implications when making and implementing asset management decisions.
Principle - Holistic "Big Picture" Approach
To support asset management decision-making, the Township will take steps to connect
the appropriate departments, functions and support activities in order to build effective
working relationships and encourage information-sharing. These departments and
functions include planning, engineering, operations, maintenance, finance and other
strategic planning functions such as sustainability.
Asset management decision-making will drive optimum value for the community by
focusing on the "big picture." The Township will therefore ensure that decisions are
made collaboratively and consider all life-cycle stages and the interrelationships
between asset performance, operational performance and overall service performance.
Decision-making will also recognize the interconnected nature of asset systems and
how decisions about one set of assets may potentially interact with or affect assets
controlled by other departments or functions.
Principle - Fiscal Responsibility and Asset Management Decision-Making
The Township will develop and maintain appropriate plans for infrastructure renewal, for
the purchase or construction of new infrastructure and for the decommissioning of
redundant infrastructure. This includes:
- Developing long-term projections of investment needs.
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- Applying rigorous analysis, including consideration of risk, to identify short-term
investment needs.
- Implementing processes to ensure that proposed investment plans address needs
efficiently and effectively.
- Implementing processes to address the operational budget implications of capital
investments.
- Exploring efficiency opportunities where appropriate, including new technologies.
- Analyzing investment plans and associated funding requirements and putting in place
mechanisms to ensure long-term financial sustainability.
The Township will evaluate relevant asset investment decisions based on consideration
of the whole-life costs associated with managing those assets through their entire life
cycle.
The Township will develop prioritized capital investment plans that reflect community
and stakeholder expectations with regard to level of service and other strategic
objectives. The Township will evaluate the magnitude, nature and overall balance of
investment plans considering the aggregate value derived for the community,
affordability, willingness to pay and intergenerational equity.
Principle - Innovation and Continual Improvement
The Township views continual improvement as a key part of our asset management
approach and will focus on driving innovation in the development of tools, techniques
and solutions.
The Township will monitor and periodically review the effectiveness of asset
management processes and the wider asset management system in supporting the
delivery of strategic objectives, and will make adjustments as required.
The Township will assess the asset management competencies required to implement
the AM system and provide the necessary support, education and training to AM staff.
The Township will review the asset management policy in conjunction with its review of
the asset management strategy, every four to five years.
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References:
Roles:
Accountable:
Council's role and responsibilities:
- Approve asset management policy
- Articulate community values and define priorities
- Approve funding and resources to implement the AM policy and associated
requirements
- Approve asset funding through multi-year and long-range financial plans
Responsible:
Role
Responsibility
Identification of issues and development of
policy updates
Council and staff
Establish levels of service
Council, staff and public
Exercise stewardship of assets, adopt
policy and budgets
Council
Implementation of policy
CAO and staff
Development of guidelines and practices
CAO and staff
On-going review of policies
Council and staff
The chief administration officer (CAO) is responsible for leading the implementation of
the AM policy across the Township. Departmental managers are responsible for leading
the adoption of the AM policy within their departments and for allocating appropriate
resources to its implementation and associated requirements.
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All staff involved in the application of asset management are responsible for observing
the requirements of the AM policy.
Actions
Responsibilities
Adopt Asset Management Policy
Council and CAO
Monitor and review infrastructure
standards and level of service policies at
established intervals
Council and CAO
Develop and maintain infrastructure
strategies
including development and service plans
CAO, Public Works, Parks & Recreation
and Finance
Develop and maintain asset inventories
CAO, Public Works, Parks & Recreation
and Finance
Assess infrastructure condition and service
levels
Public Works and Parks & Recreation
Establish and monitor infrastructure
replacement levels through the use of full
life cycle costing principles
CAO, Public Works, Parks & Recreation
and Finance
Develop and maintain financial plans for
the appropriate level of maintenance,
rehabilitation, extension and
decommission of assets
CAO, Public Works, Parks & Recreation
and Finance
Report to citizens on the status of the
community's infrastructure assets and
asset management program. The
channels may include annual citizen
reports, business plans, etc.
Council and CAO