2016 Asset Management Plan

Transcription

1 R I C H M O N D H I L L 2016 Asset Management Plan Richmond Hill, where people come together to build our community.

2 The 2016 Asset Management Plan was received by Richmond Hill Council on December 12, 2016.

3 C O N T E N T S Executive Summary Introduction Asset Management Context Asset Management in Richmond Hill State of Local Infrastructure Current Value and Condition of Richmond Hill s Assets Predicted End of Life of Richmond Hill s Assets Data Confidence and Reporting Capabilities Roadway System Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Recreation Vehicles & Equipment Parking Lots Information Technology Other Equipment & Materials Environmental Assets Conclusions Levels of Service Roadway System Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Recreation Vehicles & Equipment Parking Lots Information Technology Other Equipment & Materials Environmental Assets Conclusions Asset Management Strategies Planned Actions: Infrastructure Management Strategies Options Analysis Roadway System Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Recreation Vehicles & Equipment Parking Lots Information Technology Other Equipment & Materials Environmental Assets Conclusions Financial Strategies Annual Budget Process Revenue Sources Reserve Funds Expenditures Financial Strategies Conclusions Implementation

4 Executive Summary Richmond Hill s Asset Management Plan is a key part of moving the Town s Strategic Plan forward. Implementing and sustaining the Town s vision requires a thoughtful and long-term plan to manage Richmond Hill s infrastructure assets and the services that they deliver. The Asset Management Plan provides a set of practical tools to understand, plan and communicate how the investments that we are making today and in the future will ensure that tomorrow s residents live in a community with strong connections, has better choices, that is vibrant, and that wisely manages its resources. The operation and maintenance of local roads, parks, water and wastewater systems and buildings, like community centres and arenas, has been a core responsibility of municipalities for decades. Richmond Hill has had components of an Asset Management Plan in place for many years. The development of our first corporate Asset Management Plan is an opportunity to build on these strengths. Lake Wilcox Park Richmond Hill has $1.85 billion in infrastructure assets and an additional $87.6 million in Environmental Assets. The largest asset classes are the Roadway System ($618.1 million), Buildings ($436.2 million) and the Stormwater Network ($339.0 million) which together comprise 75% of the total asset value. The majority of Richmond Hill s growth has occurred over the last four decades and the Town s assets are relatively new. Based upon their age, 61% of assets are considered to be in good or very good condition. There are opportunities in every asset class to improve the data quality and reporting capabilities and improve data confidence. Each asset class has levels of service which focus on meeting regulatory requirements, asset condition and community satisfaction. The Town is meeting or exceeding resident level of service expectations for delivery of municipal services, shown by very high community satisfaction results in all categories. 2

5 Executive Summary R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Richmond Hill has a range of asset management strategies and an options analysis process for most asset classes, focused on the different stages of the assets lifecycle. The strongest approaches exist for the roadway surface, buildings, water and wastewater. For all asset classes, there is an opportunity to strengthen options analysis at each stage as well as link the decisions across the stages to see how they affect the overall longevity and lifecycle cost of the asset. Roadway and boulevard The Town has well established financial processes to manage infrastructure including the annual Operating and Capital Budgets, 10 Year Capital Forecast and Capital Sustainability Strategy, which complement and implement direction from the asset management plan. The asset management plan expands this view to the next 100 years and provides a look at long term trends and financial implications. Rate supported assets (Water, Wastewater and Stormwater) will be fully financially sustainable for the long term in the next ten years. Tax supported assets (Roadway System, Buildings, Parks & Outdoor Recreation, Vehicles & Equipment, Parking Lots, Information Technology, Other Equipment & Materials and Environmental) are fully funded to 2027 but require additional investment to become sustainable over the long term. The funding gap is predicted to grow from $8.7 million in 2028 to eventually reach $24.5 million per year in the long term. Short to medium term opportunities to reduce the infrastructure funding gap include: indexing Capital Sustainability Levy contributions to growth and inflation, committing a portion of the annual Gas Tax funds, attracting grants and partnerships, and improving data quality to see if asset lifespans can be extended. A longer term opportunity is to continue to increase the Capital Sustainability Levy through regular updates of Richmond Hill s Capital Sustainability Strategy. The Implementation chapter includes practical steps to address the opportunities identified through creation of the asset management plan, and includes proposed timing for implementing the actions. The twenty-two recommended actions are grouped into four categories: Establish Policy, Governance and Administration Strengthen Existing Asset Management Processes Expand the Asset Management Plan Improve Tools and Resources Asset Management Policy The Town of Richmond Hill recognizes the importance of infrastructure in realizing our community vision for the future and commits to the sustainable long-term management of the Town s infrastructure assets. 3

6 1.0 Introduction Infrastructure assets are key to Richmond Hill s mandate to deliver an array of services to our community. Ensuring our road network is clean and safe in both winter and summer requires staff and vehicles to maintain the road surface, the underlying base, sidewalks, lighting, signs and traffic signals. Supplying clean drinking water, and managing stormwater and wastewater requires an extensive network of pipes, valves and pumps. Providing a broad range of recreation opportunities requires arenas, swimming pools, parks, community centres and associated equipment. All told, Richmond Hill has over 41,000 traditional infrastructure assets, plus an inventory of 43,000 street trees and nearly 700 hectares of natural forest. 4 Water play in Lake Wilcox Park

7 Introduction R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Richmond Hill has been managing infrastructure assets ever since the Town was founded. The definition of asset management planning used by the Province of Ontario in their Building Together Guide for Municipal Asset Management Plans, the process of making the best possible decisions regarding the building, operating, maintaining, renewing, replacing and disposing of infrastructure assets is familiar to municipalities like Richmond Hill. What this Asset Management Plan does is provide a single document that describes what is being done to manage our assets, how well those actions are working and how much it will cost to maintain our assets and services. By bringing all of this information together, strengths and opportunities in the Town s processes can be identified and strategies created to improve tomorrow s outcomes. Richmond Hill Centre for the Performing Arts Richmond Hill s Asset Management Plan is a key part of moving the Town s Strategic Plan forward. During the creation of Richmond Hill s Strategic Plan we asked the people of Richmond Hill to envision what our community could become in the next 25 years. Since adopting the Strategic Plan in 2009 a new Official Plan has been approved and new or updated plans and strategies for the Town s services have been brought forward that align with the resident s vision for our community. Implementing and sustaining this consolidated vision requires a thoughtful and long-term plan to manage the Richmond Hill s infrastructure assets and the services that they deliver. O U R V I S I O N Richmond Hill, where people come together to build our community. Goal One: Stronger Connections in Richmond Hill Connections make everything work; stronger connections make everything work better. Goal Two: Better Choice in Richmond Hill Better choice is not the same as more choice. Better choice means having better quality options to achieve our community vision for Richmond Hill. Goal Three: A More Vibrant Richmond Hill Some of the best places to live and do business are dynamic and diverse. They have a unique sense of place and identity. They are vibrant. Goal Four: Wise Management of Resources in Richmond Hill Wise management means making decisions about how we consider and use our resources in Richmond Hill for this generation and those to follow. The Asset Management Plan provides a set of practical tools to understand, plan and communicate how the investments that we are making today and in the future will ensure that tomorrow s residents live in a community with strong connections, has better choices, that is vibrant, and that wisely manages its resources. 5

8 1.1 Asset Management Context The operation and maintenance of local roads, parks, water and wastewater systems and buildings, like community centres and arenas, has been a core responsibility of municipalities for decades. The Federal and Provincial governments are increasingly becoming involved in the municipal infrastructure debate and more formal requirements for asset management planning at the municipal level have been evolving since around In 2002, Ontario s current Minimum Maintenance Standards were introduced, which provide municipalities with security against liability from actions arising with regard to levels of care on roads and bridges. In addition, Ontario created the Safe Drinking Water Act, 2002, which greatly increased the transparency and accountability for management of municipal water infrastructure assets. In 2007, the Federation of Canadian Municipalities (FCM) estimated that deferred investment in municipal infrastructure assets was $123 billion and growing across Canada. In 2008, underinvestment in municipal infrastructure prompted the Public Sector Accounting Board (PSAB) to update the Canadian accounting standard for municipalities to formally track capital assets in their annual audited financial statements. Then in 2011, the Ontario government released uilding Together: Guide for Municipal Asset Management Plans, a framework for creating formal plans for all assets, not just water assets. As of the end of 2016, municipalities in Ontario will need to have a comprehensive asset management plan in order to access major grant funding from the Province and receive Federal Gas Tax funding. Asset Management seeks to answer seven key questions about a municipality s assets (Table 1). Each of these seven questions is addressed in more detail below as are key concepts of asset management that relate to the questions. Table 1: Asset Management Seven Key Questions Q1 What assets do we own and what is their condition? Q2 What are they worth? Q3 How are they performing? Q4 What actions do we need to take? Q5 When do we need to do it? Q6 How much will it cost? Q7 How will we fund it? Winter road maintenance Question 1 What assets do we own and what is their condition? introduces two ideas, an asset inventory and asset condition. Before the 2008 update to the Canadian municipal accounting standard, there was no standardized way of providing an inventory of the assets owned, operated and maintained by municipalities. Today, the Finance Division keeps the financial records for all the assets owned by the Town of Richmond Hill, with additional information stored and retrieved from the GIS database. 6 The second idea is asset condition which is important for optimizing asset management activities so we only replace assets that have a degraded condition or are at elevated risk of failure.

9 Introduction R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N A common practice for many municipalities at the start of their asset management planning process is using the age of the asset as an approximation of the condition as most assets have been designed with an expected life and performance degrades with time. Conducting inspections and assessments of each asset is a more precise method of determining condition, but can be costly and time consuming to properly collect, manage and analyze the data that is collected. Question 2 What are they worth? starts the financial discussion and introduces the concept of how to put a value on municipal assets. Some assets have a very long estimated life, in the 80 to 100 year range. The cost of an asset is not clear-cut; it can be the original cost, the current cost or the projected future cost. The approach selected will have a significant effect on the outcome of financial planning. Original costs can become outdated due to inflation, and guessing what the future replacement cost can have a large margin of error. Richmond Hill has built its asset management plan based on what it costs to replace an asset today, which is becoming the common practice for reporting municipal asset values. Question 3 How are they performing? looks at performance measures that describe the minimum acceptable condition of assets and the service provided. These together form levels of service, which can be regulatory requirements, Council approved targets, or defined by industry best practices. Question 4 What actions do we need to take? is intended to draw out what types of actions or management strategies are needed to keep assets in good working order, properly operate the assets and eventually repair or replace the assets. The answers to this question begin to define how much money is required to sustainably maintain the assets, and are influenced by the levels of service, with higher or more stringent levels of service generally requiring more maintenance and having higher operating costs. Question 5 When do we need to do it? requires an understanding of the estimated life of assets and lowest total costs concepts. Achieving the lowest total costs often includes more investment early in the asset s lifetime to address problems early and avoid premature failure, and rehabilitation that extends the life of the asset beyond the original estimates. These types of interventions, when planned well, result in a lower overall cost. Question 6 How much will it cost? looks at total lifecycle costs which include the operational, maintenance and end of life capital costs. In a municipal context, the operational and maintenance costs will typically be funded through the Operating Budget, and the end of life costs through the Capital Budget. Common practice is to have a 5 or 10 year capital forecast based on the current condition of assets, prioritizing funding for specific projects. However, given the projected lifespan of long-lived assets, a more sustainable approach is to adopt a longer term capital strategy based on end of life replacement of assets that spans 20+ years. The longer term view creates a forecast for how much funding will be required annually to replace end of life assets, and provides information about when peaks in funding needs may occur. Question 7 How will we fund it? addresses where the money will come from and how different financial strategies can be used to manage the total costs over the long-term. It requires an examination of forecasted expenditures, and funding and revenue sources through the Operating Budget, Capital Budget and Reserve Funds. Together these questions provide a road map for the development of a comprehensive municipal Asset Management Plan. 7

10 1.2 Asset Management in Richmond Hill Richmond Hill has had components of an Asset Management Plan in place for many years. The development of our first corporate Asset Management Plan is an opportunity to build on these strengths. The process to develop our Asset Management Plan involved a number of steps including developing and confirming an approach to asset management planning, understanding the current state of our asset management practices, identifying and addressing gaps and preparing the plan. The collaborative and cross-disciplinary process followed a Terms of Reference and was supported by a Steering Committee and Working Group comprised of staff from Environment & Infrastructure Services, Development Engineering, Operations, Finance, Information Technology and Strategic Initiatives. Asset Management Policy The Town of Richmond Hill recognizes the importance of infrastructure in realizing our community vision for the future and commits to the sustainable long-term management of the Town s infrastructure assets. Asset Management Planning aims to achieve the lowest total cost for owning assets when considering: desired levels of service initial purchase costs operational costs maintenance costs rehabilitation costs replacement costs disposal costs An overall picture of Asset Management in Richmond Hill, including the key Corporate Functions and the Asset Management Elements and Documents and Systems that are associated with each is outlined in Figure 1. Planning and policy direction for asset management planning are laid out in our Strategic Plan and Official Plan. Additional plans and strategies such as the Parks Plan, Recreation Plan, Culture Plan, Transportation Master Plan and Environment Strategy provide further direction on how infrastructure is important to reaching the collective vision for the future of the Town. Infrastructure Design & Construction includes the Geographic Information System (GIS) database to track infrastructure inventory and age, Capital Project Prioritization Ranking Systems to set priorities for infrastructure replacement, a lifecycle management system ReCAPP (Renewal Capital Asset Planning Process) and the Capital Delivery Program. Operations & Service Delivery includes the Maximo Work and Asset Management System and specialized asset specific systems like the Pavement Management System. Finally, Richmond Hill s Finance function includes the Capital Sustainability Strategy, the Ten Year Capital Forecast, the annual Capital and Operating Budgets including the capital budget manual, and the Tangible Capital Assets Policy and Database. 8 Photo credit: Oak Ridges Community Centre

11 Introduction R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Figure 1: Richmond Hill s Asset Management Framework Richmond Hill s first Asset Management Plan includes virtually all infrastructure assets for which the Town is responsible including the roadway system, buildings, water, wastewater and stormwater networks, parks, environmental assets, fleet and equipment, information technology and other equipment and materials. More information on each of these asset classes and the services they support are provided in Table 2. In addition to the assets in Table 2, York Region owns assets and provides services in Richmond Hill. The Regional assets are part of the Regional asset management plan and include: most arterial roads, major bridges, public transit assets, affordable housing, and police services. Further, the water and wastewater treatment facilities that service the Town are owned and operated outside of Richmond Hill and are not included in this plan. Since our Asset Management Plan includes all assets, the time frame for the plan needs to take into consideration the replacement of long-lived assets like watermains and sewer pipes. The period for the plan has therefore been set to 100 years which includes the first replacement of all assets. While the 100 year view provides a look at long term trends and financial implications, additional attention is paid to current assets requiring replacement in the 10 year capital forecast. The plan is a living document; progress in implementing the plan will be reported annually and the plan itself will be updated every four years. 9

12 Table 2: Asset Classes and Services Supported Asset Class Components Services Supported Roadway System Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Recreation Road surface & road base Bridges & culverts Signs, lighting, sidewalks Traffic signals Structural Architectural Mechanical Electrical Stormwater management facilities Stormwater pipes Catchbasins, Manholes Water pipes Water valves Water meters Wastewater pipes Pumping stations Pathways & trails Playgrounds & waterplays Servicing & furnishings Sports facilities Local transportation Transit (service provided by York Region) Cycling and pedestrian active transportation Delivery of goods Emergency services Arts, culture & library Community centres & arenas Fire services General government administration Heritage preservation Conveyance of water Flood and erosion control Water quality treatment Delivery of potable drinking water Sewage collection Sports Outdoor recreation Walking paths & trails Parking Lots Subcomponents not available Support to Buildings and Parks services Vehicles & Equipment Fire fleet Other vehicles & equipment such as: bylaw enforcement vehicles, dump trucks, snow plows, mowers, front end loaders All municipal services Information Technology Hardware, software, telecom All municipal services Other Equipment & Materials Environmental Assets Library materials Small tools & equipment Furniture Street trees Natural forest areas Valleyland capital assets Libraries Fire services Community centres Tree cover Conveyance of water Biodiversity Stormwater and Erosion control Clean air Greenspace recreation for residents 10

13 Introduction R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Richmond Hill s original Post Office on Yonge Street Richmond Hill s Asset Management Plan answers the seven key questions about asset management planning and is compliant with the Building Together guideline. The assets the Town owns, the condition they are in and how much are they worth today are described in the State of Local Infrastructure chapter. The Levels of Service chapter presents a consolidated view of the desired service standards the Town has for our assets and services, and captures how well the assets and asset management strategies are performing. The Asset Management Strategies chapter provides more detail about the Town s planned operations, maintenance, rehabilitation, and replacement activities, describing how they are applied to the major stages of an assets lifespan. The Financial Strategies chapter provides a view of historical costs for asset management in Richmond Hill, current and proposed expenditures, revenue and funding and forward looking sustainability strategies. The final chapter includes recommended actions with short, medium and long term priorities. Stormwater sampling Asset Management Plan Sections 1. Executive Summary 2. Introduction 3. State of Local Infrastructure 4. Levels of Service 5. Asset Management Strategies 6. Financial Strategies 7. Implementation 11

14 2.0 State of Local Infrastructure What was once a small but thriving town along the Yonge Street corridor is today one of the fastest growing and most desirable communities in Ontario. As Richmond Hill has grown over the past few decades, roads, parks and community centres were built, and underground networks that carry drinking water, stormwater and wastewater were expanded. As this infrastructure aged, it needed more attention to ensure that it continued to reliably serve the community. Some of this infrastructure is easy to see, like the surface of roads or playgrounds in a park. Other infrastructure is largely below ground, like the pipes and valves that provide drinking water. 12 Stormwater culvert installation

15 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Overall there is more to Richmond Hill s infrastructure than meets the eye. For example, a typical community centre contains numerous complex systems that operate behind the scenes, such as heating, cooling, security, or solar hot water heating, in addition to the bathrooms, windows, doors, flooring and wall finishes. The Town s current infrastructure inventory contains over 41,000 assets (Table 3), such as water valves, streetlights, and swimming pool pumps, each of which needs to be understood and managed. If we had to replace all of these traditional assets right now, it would cost about $1.8 billion. Additionally, there are over 43,000 street trees and almost 700 hectares of natural Pedestrians using Roadway System sidewalk forest in a separate inventory. It should be no surprise, given the complexity of the infrastructure that supports the quality of life in Richmond Hill, that the first step of asset management planning is understanding what infrastructure we have and its condition. This is the State of Local Infrastructure. Table 3: Infrastructure Assets in Richmond Hill Examples Key Data Sources Roadway System Buildings Stormwater Management Road surface, road bed, bridges & culverts, traffic signals (poles, signals, signs), street lighting (poles, lights, wiring), street signs Foundation, windows, heating and cooling systems, plumbing, electrical wiring, washrooms, doors, solar heating systems, security systems, concrete & steel structural components, heritage buildings Rainwater drainage in roads and parks (catchbasins), access holes in roads (maintenance holes or manholes), pipes ranging from 150 mm PVC to 2500 x 7100 mm reinforced concrete, stormwater management ponds, headwalls and grates, outlet channels Tangible capital assets database Pavement Management Analysis Bridge inspection results Tangible capital assets database Tangible capital assets database 13

16 Table 3: Infrastructure Assets in Richmond Hill Water Network Wastewater Network Parks & Outdoor Recreation Vehicles & Equipment Examples Fire hydrants, valves at the property line, pipes from homes and businesses to the watermain, mainline pipes ranging from 20 mm copper to 1800 mm reinforced concrete, mainline valves up to 1800 mm diameter, water meters at homes and businesses Pipes from homes and businesses (laterals) to the sewer main, mainline pipes up to 1675 mm concrete, access holes, pumping stations Sports facilities: basketball courts, soccer fields, baseball diamonds, benches, fences Parks & Trails: signs, landscaping, asphalt, concrete, waste bins Waterplays: pumps, pipes, concrete, play Structures Playgrounds: structures, sandboxes, rubber play surfaces, drains, lighting General: fences, parking lots, bollards, signage Light duty vehicles, dump trucks, half ton trucks, bucket trucks, fire trucks, snow plow attachments, blower attachments, Zambonis, tractors, skid steers, loaders Key Data Sources Tangible capital assets database Tangible capital assets database Tangible capital assets database Tangible capital assets database Parking Lots Gravel and asphalt parking lots Tangible capital assets database Information Technology Other Equipment & Materials Environmental Assets Network servers, PCs, printers, plotters, all software, telephones Wide variety of lower-cost assets: library books, exercise equipment, AEDs, hazmat equipment, bike cycle racks, fire rescue equipment, kitchen sinks Street trees, trees in parks and urban forest, stream channels Tangible capital assets database Tangible capital assets database 2012 Urban Forest Report 2014 Terrestrial Biological Inventory GIS street tree inventory 14

17 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Chapter 2: State of Local Infrastructure will provide an overview of the Town s total assets: the types and quantities of assets, their value, the age distribution, as well as their condition. It answers the questions: what do we own?, what is the condition? and what are they Asset management requires a thorough understanding of the characteristics and condition of infrastructure assets. Building Together worth? This chapter is the beginning of the story of asset management in Richmond Hill, describing the current state of the Town s assets. In order to understand the state of Richmond Hill s infrastructure assets, it is important to establish: a method for calculating current value (Asset Value), how long assets are expected to last (Expected Life of Assets), common definitions for asset conditions (Asset Condition), and a way of identifying the asset classes we have robust information for, and identify those where our understanding could be improved (Data Confidence). Asset Value Richmond Hill s assets were constructed over decades (Figure 2 and 3). The oldest asset on record, the Burr House, was constructed in 1825 although most of Richmond Hill s assets are newer with almost 70% having been constructed since In order to standardize the values and compare to other municipalities and the Canadian Infrastructure Report Card, the asset value of each item in Richmond Hill s asset inventory is expressed as the current value, answering the question What are the assets worth today? This is accomplished by taking the original costs of the asset and multiplying it by the Non Residential Building Construction Price Index (NRBCPI). Richmond Hill s asset values are recorded in the Tangible Capital Asset (TCA) database and updated and reported annually as part of Public Sector Accounting Board (PSAB) requirements data from the TCA database has been used as the basis for the state of local infrastructure. $140 Figure 2 : Annual Value of Construction of Richmond Hill Infrastructure (2014 $ s) Millons $120 $100 $80 $60 $40 $

18 Figure 3: Cumulative Value of Construction of Richmond Hill Infrastructure (2014 $ s) Millons $2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $ Expected Life of Assets The Expected Life of Assets is the length of time that infrastructure assets have been designed to last. Owners of assets can expect most assets to provide full service for at least this length of time under normal conditions. Most assets will be usable past their estimated life, although a small portion of assets may fail before their expected end of life. For this reason, asset managers pay more attention to the period where an asset is nearing its expected end of life and when it is predicted to be past its end of life; monitoring the asset s condition, determining whether it is meeting the level of service and evaluating how much risk is associated with continuing to operate the asset. Many infrastructure assets can be kept serviceable indefinitely, with proper maintenance and funding. Though it is possible to keep many infrastructure assets in service indefinitely, it is not usually advisable as the cost of more frequent and costly maintenance with increased risk of unexpected failures may be more expensive than replacing the asset. Some of Richmond Hill s infrastructure assets are designed to be in service for a long time, like PVC and copper water mains with an estimated life of years. Others, like a pickup truck, are only expected to last 7-8 years. As a result, a water main will only be expected to be replaced once in the 100 year period of the asset management plan whereas a pickup truck will need to be replaced twelve times. Table 4 lists the estimated life expectancies of different assets in Richmond Hill. These expected life estimates are documented in the Tangible Capital Assets Policy following recommendations from the groups that design and operate the assets and benchmarking with other municipalities. Baseball diamond maintenance 16

19 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Table 4: Estimated Life of Assets Asset Category Sub-Category Useful life (Years) Land Improvements Parks & Parkettes Parking lots 15 Building sites Buildings Structural 40 Architectural 40 Mechanical 25 Electrical 20 Vehicles Cars 4-7 Fire trucks 15 Landscaping & snowplowing equipment 8-10 Pickups and vans 7-8 Non-licensed vehicles 10 Sewer flusher, sweepers & other 8-10 Machinery & Equipment Arena 3-20 IT 4-15 Fire 5-15 Parks, Recreation & Culture 5-15 By-law 5-15 Library 7-15 Furniture & Fixtures Other Roadway system Water network Wastewater Stormwater Management All Departments 5-15 Library Collections 4-12 Traveled roads 20 Sidewalk & walkways Bridges & culverts Streetlights 25 Street signs 10 Traffic lights Watermain Control valves 35 Specialty valves 35 Hydrants 50 Water meter 20 Sanitary sewers Manholes 100 Pump & lift station Storm sewers Manholes 100 Catch basins 100 Storm ponds 4-20 Monitoring Equipment 15 Laboratory Equipment 15 17

20 Asset Condition Determining the condition of assets is critical for asset management planning, enabling detailed analysis to determine when replacement of an asset will achieve the lowest total cost. One method assumes that new assets have an expected life (for example, a new sidewalk is predicted to last for 45 years) and their condition will slowly worsen as they age, then need to be replaced after they reach their estimated end of their life. This method compares the age of an asset against its expected life and assigns a condition to each asset based upon the percentage of useful life remaining (Table 5). A second, more robust, method involves directly measuring the condition of the asset against a technical standard. For example, Pavement Management Analysis (using a specialized truck equipped with sensors that scan road condition) is conducted every two years on Richmond Hill s roads. This process yields scores that tell us directly the condition of the roads based upon technical criteria. For the purposes of this chapter, the first method of evaluating asset condition, based upon age, will be the primary method, supplemented with condition assessment data where available. While direct measurement of asset condition is necessary for implementing asset management strategies, the use of asset age enables comparison between asset classes where many do not have detailed condition information available. Table 5: Age-based Asset Condition Rating System Rating Category % of Estimated Life Remaining Asset Condition Characteristics Very Good 76% - 100% Fit for the Future : New or recently rehabilitated. Very low risk of failure. Low capital maintenance needs. Scheduled maintenance reduces the probability of premature failure. Good 51% - 75% Adequate for Now : Some signs of deterioration. Low risk of failure. Some unplanned maintenance is required. Fair 26% - 50% Requires Attention : Additional signs of deterioration. Level of service may be affected. Some failures occur. Rehabilitation possible. Nearing End of Life Beyond End of Life 0% - 25% At Risk : Failures will increasingly occur. Reduced ability to provide the service. Maintenance costs will likely increase. Rehabilitation may become impossible. < 0% At Risk : Similar characteristics to Nearing End of Life. Assets in this category are considered to be part of the Infrastructure Backlog. Data Confidence Data confidence is an evaluation of how reliable the data is that is being used for asset management decisions. It expresses how much confidence we have in the available data. The data confidence findings provided in this chapter combine four aspects: data collection, data processing, analysis techniques and reporting capabilities into a rating of Advanced (High), Intermediate (Medium) or Basic (Low). Generally, asset managers would be expected to have high confidence in the data for an asset class with a complete and reliable inventory, where field conditions are incorporated into the asset data database, and where there is standardized reporting. Lower data confidence scores reflect uncertainty in one or more aspects of the asset data and an opportunity to improve our understanding as the asset management processes mature. 18

21 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N 2.1 Current Value and Condition of Richmond Hill s Assets Richmond Hill has approximately $1.85 billion in recorded tangible capital assets using their 2014 replacement cost. To further understand the range of infrastructure that Richmond Hill is responsible for, ten asset classes are broken out of our overall asset database (Table 6 and Figure 4). Table 6: Replacement Costs by Asset Class (2014 dollars) Asset Class Roadway System Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Recreation Vehicles & Equipment Replacement Cost $ M $ M $ M $ M $ M $ M $ 28.4 M Parking Lots $ 23.6 M The largest asset class by value is the roadway Information Technology $ 16.0 M system ($618.1 million), representing 33.5% of Other Equipment & Materials $ 23.1 M the overall assets. This is followed by buildings Total $ 1,845.7 M ($436.2 million) and stormwater management ($339.0 million) with 23.6% and 18.4% of the assets respectively. Water, wastewater and parks have relatively lower values although each of these asset classes still exceeds a current value of $100 million. The remaining asset classes are much smaller in current value. Figure 4: Current Value Distribution TCA Assets 33% 1% 24% 1% 1% 2% 6% 7% 18% 7% Roadway System Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Vehicles & Equipment Parking Lots Other Equipment & Materials Information Technology In addition to the tangible capital assets, Richmond Hill has included a portion of the Town s Environmental Assets in our Asset Management Plan. Overall there are $87.6 million in Environmental Assets that have been inventoried, which would equate to the seventh highest value asset compared to the Tangible Capital Assets inventory. At this time, these categories of assets are not part of the annual audited financial statements, or the PSAB-compliant tangible capital asset database where the valuation of traditional infrastructure assets is stored. Environmental assets are therefore being kept separate in this version of the asset management plan. There is an opportunity to integrate these assets further in future plans. 19

22 During the creation of this plan, a few types of assets were identified that are not in the TCA database or are being tracked through other systems: decorative walls, gatehouses and noise attenuation fencing. These assets are in the process of being inventoried and integrated into existing asset classes, but will not be ready in time for this asset management plan. Asset Age Analysis What observations can be drawn from asset age data? As much as it would be nice to have all assets in the good to very good range (with more than 50% of their life remaining), that would require replacing the assets more frequently than is necessary. Using assets until they are near their end of life, while maintaining the level of service that the asset delivers, minimizes the need for, and cost of, premature replacement. An asset age distribution that has about 25% of assets in each of the very good, good, fair and nearing end of life age categories results in a cost-effective, predictable and orderly process of maintenance and replacement of assets. The further the age distribution for an asset class differs from a balanced distribution, the higher the risks are for large clusters of asset reaching their end of life at once. Nearing & Very Good Beyond End 25% of Life 25% Fair Good 25% 25% Overall, infrastructure in Richmond Hill is relatively new and is therefore considered to be in good condition based on the condition rating system in Table 5. More than 60% of the assets have over half of their remaining life left and are deemed to be in good or very good condition (Figure 5). A further 21% are considered to be in fair condition with a quarter to a half of their life remaining. The remaining 18% are either nearing their end of life or are predicted to be past their end of life and require careful monitoring and maintenance. $192.6 M 10% $142.7 M 8% $394.6 M 21% Figure 5: Asset Condition Distribution $494.1 M 27% $621.8 M 34% Very Good Good Fair Nearing End of Life Beyond End of Life 20

23 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Looking further into the individual asset classes, Water and Wastewater Networks and Stormwater Management are relatively new compared to their useful life (Figure 6), each with more than 70% of the assets considered to be in good or very good condition. Parks, Roadway System, Buildings and Other Equipment & Materials have age distributions closer to a balanced distribution, with between 45% and 65% of assets considered to be in good or very good condition. The remaining classes, Parking Lots and Information Technology, are relatively older compared to their useful life with less than 35% of assets considered to be in good or very good condition. The asset classes frequently have several subclasses or components. For example, the Roadway System includes the Road Surface, the Road Bed, Sidewalks, Streetlighting, Traffic Signals, and Bridges and Culverts. A detailed analysis of each of the Asset Classes including the subclasses is provided in sections 3.3 to Figure 6: Asset Age Distribution Roadway System Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Recreation Vehicles & Equipment Parking Lots Information Technology Other Equipment & Materials 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life 2.2 Predicted End of Life of Richmond Hill s Assets One of the key questions in asset management planning is, When do we need to do it? By incorporating the year of construction and the life expectancies of different types of assets we can begin to understand how much infrastructure will reach its predicted end of life each year into the future. Figure 7 shows the percentage of infrastructure assets, by value, predicted to reach their end of life each year and needing replacement over the next 100 years. Since Richmond Hill experienced periods of faster and slower growth over the past few decades there is more infrastructure predicted to be replaced some years than others. Overall, the yearly replacement averages around 3% and ranges between about 1% and 7%. 21

24 Figure 7: Annual Percentage of Assets by Value Predicted to be at End of Life 8% 7% 6% 5% 4% 3% 2% 1% 0% Since assets with a shorter life expectancy will need to be replaced more frequently than longer lived assets over the 100 year period, the percentage breakdown of costs between the asset classes at end of life replacement is somewhat different than the current value distribution (see Figure 8). Figure 8: 100 Year Accumulated Replacements 9% 5% 2% 5% 6% 27% Roadway System Buildings Stormwater Management Water Network Wastewater Network 3% 5% 12% 26% Parks & Outdoor Vehicles & Equipment Parking Lots Other Equipment & Materials Information Technology The Roadway System and Buildings still have the greatest percentage of assets by value to be replaced. Together they comprise over 50% of the overall asset replacements, followed by Stormwater Management (12%) and Parks & Outdoor Recreation assets (9%). The lower-cost, shorter lifespan assets that will have to be repeatedly replaced over a 100 year period now represent a larger percentage of the assets to be replaced, such as Information Technology and Vehicles & Equipment which have accumulated costs equal to or greater than either the Water or Wastewater Network costs. 22

25 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N 2.3 Data Confidence and Reporting Capabilities Evaluating the confidence in the foundational asset management data and the sophistication of the data reporting capabilities provides a view of how reliable the data is that forms the basis of asset management decisions. Table 7 evaluates each asset class on how the data is collected, how it is stored, and how sophisticated the analysis and reporting capabilities are for the data inventory. For some infrastructure assets such as roads, buildings and water networks, the available information is more extensive and the reporting more advanced. Other asset classes accurately track costs but additional details about the inventory are less reliable. The data confidence ratings are simplified to a single rating in the discussion of each asset class by averaging the ratings of each of the four evaluation criteria. Table 7: Data Confidence and Reporting Capabilities Data Collection Data Processing Data Analysis Reporting Roadway System Road Bed Road Surface Sidewalks & Walkways Street Lighting Bridges & Culverts Traffic Signals Buildings Stormwater Management Water Network Wastewater Network Parks & Outdoor Recreation Parking Lots Vehicles & Equipment Information Technology Advanced Intermediate Basic The data collection for inventory, condition and value of most asset classes have intermediate and advanced capabilities, but reporting capabilities are mostly basic, requiring generation of custom, one-off reports. Only Buildings and the Roadway Surface are using decision support tools (software) for data processing and data analysis. Though it is not necessary to have advance capabilities for all assets and all aspects, improved data confidence and analysis translates into more effective decision making, less rework and enables lower overall costs. 23

26 2.4 Roadway System In Richmond Hill, the Roadway System is about more than just moving cars. It is about creating stronger connections and offering better choice to our community, with a focus on encouraging pedestrian travel, cycling and transit. Our infrastructure includes over 550 km of primarily urban collector and local roads as well as sidewalks and walkways, and the traffic signals, traffic signs and street lighting that support them. Richmond Hill s roadway system also includes 55 bridges and culverts. Other roads and bridges that connect Richmond Hill to its surrounding municipalities are owned and maintained by York Region and are not included. Underneath the Roadway System are other Town-owned and operated assets for drinking water supply, wastewater collection and stormwater conveyance. While not part of the Roadway System, they share the same physical location and need to be considered as a whole when planning maintenance and replacement activities, especially when one or more components are at their end of life Inventory, Value and Condition Overall, the Roadway System includes millions of square meters of road surface (Table 8). We have over 600 km of sidewalks and 55 bridges and culverts. Our Streetlighting and Traffic Signals include thousands of components. The road itself is separated into the Road Surface and the underlying Road Bed because the surface has a significantly shorter lifespan than the base, and has very different maintenance strategies. The single largest component of the Roadway System is the Road Bed itself, comprising over 70% of the overall current value in the Roadway System. Sidewalks & Walkways and Bridges & Culverts are the next biggest by value comprising 9.9% and 8.8% respectively. Asset Class Table 8: Roadway System Inventory & Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Roadway System $ M Road Bed & Road Surface $ M 4,686,944 m2 Intermediate Sidewalks & Walkways $ 61.1 M 601,982 m Advanced Bridges & Culverts $ 53.8 M 55 locations Advanced Street Lighting $ 39.4 M 16,122 components Basic Traffic Signals $ 5.1 M 35 locations Basic Data confidence for the Roadway System varies by component. There is a regular condition assessment for Bridges & Culverts, the Road Surface, and the Sidewalks & Walkways increasing confidence in these areas. The Road Bed is difficult to directly observe so it warrants a intermediate confidence. Street Lighting is composed of thousands of individual components of different designs, and ownership of individual assets is complicated by inter-jurisdictional and contracted maintenance agreements, resulting in lower confidence in the data. 24

27 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Overall, the Roadway System has a balanced age distribution (Figure 9) with almost half (49%) of the Roadway System assets having over half of their estimated life remaining. A further 34% of the assets have between 25% and 50% of their estimated life remaining leaving 14% nearing end of life and just 3% predicted to be beyond end of life. Roads are highly regulated and highly visible systems with a lot of public interest. As a result, they have been a focus of the asset management discipline and have some of the most widespread and effective management systems in place. $17.6 M 3% Figure 9: Roadway System Asset Condition Distribution $82.9 M $124.8 M 14% 20% $205.0 M $179.3 M 34% 29% Very Good Good Fair Nearing End of Life Beyond End of Life Looking at the components that make up the Roadway System, Bridges & Culverts and Sidewalks & Walkways have the most assets in good or very good condition. Only a small proportion of these assets are predicted to be nearing or beyond their end of life (Figure 10). Bridges & Culverts are expensive assets that have significant consequences if they fail and Provincial legislation requires bi-annual inspections. There should be few if any assets in this class that operate beyond their end of life; which the Town s maintenance strategies appear to be achieving. Sidewalks & Walkways also have a Provincial minimum maintenance standard to reduce tripping risks, which can be achieved with proper maintenance of older sidewalks. The high percentage of sidewalks and walkways in good or better condition is primarily due to the amount of sidewalks being built in new subdivisions. Figure 10: Roadway System Components Age Distribution Road Bed Sidewalks & Walkways Bridges & Culverts Street Lighting Road Surfaces Traffic Signals 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life 25

28 The Road Bed and Road Surface have close to a balanced age distribution although recent condition assessment data shows that over 90% of the Road Surface is in Good or Very Good condition. The Town has an annual program to resurface roads whose surface is in poor condition and a program to convert rural profile roads to an urban standard. The Road Bed has virtually no assets that are predicted to be beyond end of life which presents an opportunity to include water, sewer and stormwater assets when planning and performing major maintenance of the road bed. In contrast, Traffic Signals and Street Lighting have less than half of their assets in good or very good condition. Street Lighting is the area of most concern with 60% of the assets predicted to be nearing or beyond end of life. The Street Lighting inventory data is currently of basic quality, with approximately 20% of the entries requiring investigation. However, the Town is in the process of converting the street lights to LED technology, which will partially renew these assets, reduce operating costs and update the street lighting asset inventory. The LED project will also upgrade lighting in parks, paths and parking lots. With project roll-out starting in 2016, the asset condition improvements will start being seen in Predicted End of Life Looking forward, the percentage of Roadway System assets predicted to reach their end of life each year range over the next 100 years is variable, averaging 2.3% annually but ranging from 0.5% to over 8% (Figure 11). It is difficult to put resources in place to oversee the design and reconstruction of assets when the scope of the program changes dramatically from year to year. Managing the replacement of these assets in an orderly way will require looking at strategies to even out the investment and resources needed in the Roadway System. Roadway and boulevard with street trees Figure 11: Roadway System 100 Year Annual Percentage Reaching End of Life 9% 8% 7% 6% 5% 4% 3% 2% 1% 0%

29 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Key Findings Overall, Richmond Hill s roadway system has a balanced age distribution with few assets nearing or beyond their end of life. One area that needs focus is the streetlights, which are scheduled to be upgraded to LED technology in the next few years. Another area requiring attention is to increase the confidence in data, including basic inventory and ownership of streetlights and traffic signals as well as ensuring that major rehabilitation of the roadway system is incorporated back into the age and condition database. Finally, the variability of the assets predicted to reach end of life and their connection to the underground services needs to be managed to ensure an orderly and manageable reinvestment in this highly visible and regulated class of infrastructure. 2.5 Buildings Municipal Buildings are the places where people come together to connect and get involved. They support the administration of Richmond Hill including land, infrastructure and service planning, and provide the venue for community input into Council decisions. They support Public Works, Parks and Fire operations which maintain our infrastructure and keep our community safe. And they offer services to the community, such as recreation programs and theatre presentations. Buildings are the second largest Asset Class with a current value of $436.2 million Inventory, Value and Condition There are two ways to view Richmond Hill s building inventory which comprises 73 buildings. The first is by building type or purpose (Table 9). The Town s 26 Community Centres & Arenas are the largest category of Town buildings comprising over 50% ($230.9 million) of the total building inventory by current value. These buildings offer opportunities for our community to become active and involved in 2013 over 1.7 million participant hours were recorded. Two General Government buildings are the next biggest category ($85.3 million) and include the Municipal Offices at 225 East Beaver Creek and the Town s Operations Centre at 1200 Elgin Mills Road East. The majority of staff work out of these buildings. Nine Arts, Culture & Library buildings are the next largest category ($76.1 million) with the Richmond Hill Centre for the Performing Arts being the single largest in this category. The remaining categories are much smaller in value but are either vital to important services such fire and emergency response (Fire Halls) or to preserving the Town s heritage (Heritage Buildings). Finally, the Other Buildings category includes a collection of 17 small facilities such as free standing public washrooms. Another way of viewing the building inventory is by the physical structure and systems within the buildings, not just how the building is used (Table 9). There are many components to a building such as the windows, walls, roof, heating, plumbing, electrical, security, fire safety and so on. Each of these require attention by specialized tradespersons. Over 60% of the current value of the Town s buildings is associated with the Architectural and Structural components (windows, doors, roof, walls), with Mechanical (e.g. heating, plumbing) and Electrical comprising 26% and 12% respectively. 27

30 Table 9: Buildings Inventory & Current Value Building Component Replacement Cost (2014 dollars) Data Confidence Building Type Replacement Cost (2014 dollars) Quantity Buildings $ M Buildings $ M Architectural & Structural $ M Advanced Community Centres & Arenas $ M 26 Mechanical $ M Advanced General Government $ 85.3 M 2 Electrical $ 50.6 M Advanced Arts, Culture & Library $ 76.1 M 9 Fire Hall $ 19.4 M 6 Other Structures $ 16.7 M 17 Heritage Buildings $ 7.8 M 13 The current value for Buildings is based upon the estimated replacement costs of the components of the building rather than for constructing an entirely new replacement building. This provides a valuation of what it would cost to replace each physical component (except for the foundation and major walls) of the building separately, which is what would be done over time as the building is maintained. Data confidence for buildings and their components is advanced due to an inventory that is updated at least every 5 years, including gathering and recording up to date condition assessment. This data is managed in a software system that allows for detailed reporting, modeling and scheduling of maintenance. There is up to a 5 year delay between the replacement of building components and the next inventory audit, which is an area for potential future improvements. Overall, in the Town s Buildings, there is a close to a balanced age distribution (Figure 12) with 48% in good condition or better, 25% in fair condition and 27% nearing end of life or predicted to be past end of life. Figure 12: Buildings Asset Condition Distribution $62.1 M 14% $56.3 M 13% $146.4 M 34% $110.4 M 25% $61.0 M 14% Very Good Good Fair Nearing End of Life Beyond End of Life 28

31 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Looking at the individual building types (Figure 13), the Arts, Cultural & Libraries buildings have the most assets (over 70%) in good or very good condition. General Government and Fire Halls have a close to balanced age distribution with around 50% of assets in good to very good condition. The Community Centres & Arenas are showing a little more aging even though there has been significant investment recently in these buildings. The Other Buildings category shows the least assets in good or very good condition with almost 80% of assets with less than half of their life remaining including 35% predicted to be nearing or beyond end of life. Figure 13: Buildings Components Age Distribution Community Centres & Arenas General Government Fire Hall Arts, Culture & Library Other Structures Heritage Buildings 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life The current valuation system is not well suited for Heritage Buildings. Many of the components of Heritage Buildings must be maintained rather than replaced over time to preserve designated heritage features. As a result, forecast replacement dates and costs based upon age are not as meaningful and many of the components will show beyond end of life when in fact they are kept serviceable with proper maintenance strategies Predicted End of Life George Forster Historical House The percentage of Buildings assets predicted to reach their end of life annually over a 100 year period averages 3.2% and is variable, ranging from less than 1% to over 10% a single year (Figure 14). Similar to the Roadway System, there is an opportunity to look at strategies to even out the year to year investment needed in the Buildings. In 2015, Council directed that a Facility Condition Index (FCI) of 7% for Town buildings be targeted, which roughly translates to 7% of the assets being rehabilitated or replaced each year. Heritage Buildings are not included in the 7% FCI target. 29

32 Figure 14: Buildings 100 Year Annual Percentage Reaching End of Life 12% 10% 8% 6% 4% 2% 0% Key Findings Richmond Hill s buildings have a balanced age distribution with few assets nearing or beyond the estimated end of life. Buildings have a long history in the asset management discipline, and the systems that Richmond Hill has put in place result in a high degree of confidence in the data. Though mostly in good shape, the predicted pace of assets reaching their end of life is very volatile. The current state and valuation of the Heritage Buildings needs to be re-evaluated to consider heritage features which are not supposed to be replaced at end of life but instead maintained over the long term to preserve the building s heritage designation. 2.6 Stormwater Management Richmond Hill owns and operates stormwater infrastructure including over 70 stormwater management ponds and hundreds of kilometers of storm sewers. This infrastructure plays an important role in protecting the environment from flooding and erosion and by treating the quality of water before it is released back into natural rivers and streams. Richmond Hill s Stormwater Management assets are the third most valuable asset class value at $339.0 million Inventory, Value and Condition Just over half of the value of the Stormwater Management asset class are the Storm Sewers, comprised of 590 km of underground pipes that carry stormwater from roads and parking lots into stormwater management facilities or directly into natural streams in the older parts of Town (Table 10). The next largest category (21%) are the 73 stormwater management facilities that treat the water as well as provide flood and erosion control before releasing it into the environment. The remaining categories are the Maintenance Holes (14%) that provide access to this large underground network, the Catchbasins (10%), which are the structures which collect the water at the surface and remove road debris before it enters the storm sewers and the Foundation Drain Collectors (2%) which convey underground stormwater away from houses into the storm sewers to reduce the risk of basement flooding. 30

33 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Asset Class Table 10: Stormwater Management Inventory and Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Stormwater Management Stormwater Network $ M $ M Storm Sewers $ M km Basic Maintenance Holes $ 46.7 M 8,371 ea Basic Catchbasins $ 33.4 M 14,172 ea Basic Foundation Drain Collectors $ 6.2 M 40.2 km Basic Stormwater Management Facility $ 70.0 M 73 facilities* Intermediate *Based on the 2014 TCA data. Overall, the Stormwater Management system data capabilities are basic. Most of the storm sewer network is not visible, making assessment of the assets difficult. Stormwater assets have very long life expectancies so there are very long gaps between required repair and replacement activities. The understanding of this asset class has increased in the last 15 to 20 years, as more mature asset management tools have been developed. The Stormwater Management Facilities are challenging to put a replacement value on because they are an engineered and constructed pond that slowly fills with sediment washed into the pond by rainwater. They need periodic maintenance to remove the sediment and ensure the inflow and outflow pipes are in workable condition, but full reconstruction of the pond should only be required if the engineering standards change or a failure of a major component of the facility occurs. The long expected life of stormwater assets, and relatively new installation of the assets, is reflected in the asset condition distribution (Figure 15) which shows that 87% of the assets are in good or very good condition with over half of their expected life remaining. Figure 15: Stormwater Management Asset Condition Distribution $10.4 M 3% $27.8 M $6.3 M 8% 2% $102.2 M $192.3 M 30% 57% Very Good Good Fair Nearing End of Life Beyond End of Life 31

34 Figure 16: Stormwater Management Components Age Distribution 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Stormwater Network Stormwater Management Facility Very Good Good Fair Nearing End of Life Beyond End of Life Looking at the individual components 98% of the Storm Sewers, Manholes, Catchbasins and Foundation Drain Collectors have over half of their estimated life remaining (Figure 16). The Stormwater Management Facilities show a different pattern with just under 50% of the assets in good or very good condition and just over half of the assets nearing end of life or predicted to be past end of life Predicted End of Life The percentage of Stormwater Management assets predicted to reach their end of life over the next 100 years is somewhat variable, averaging 1.8% and ranging from less than 0.5% to over 7% annually (Figure 17). Unlike the Roadway Systems and Buildings, there is a significantly greater concentration of assets reaching their end of life later in the 100 year period due to the comparably longer asset life of assets in the Stormwater System. 8% 7% 6% 5% 4% 3% 2% 1% 0% Pioneer Park stormwater management facility Figure 17: Stormwater Management 100 Year Annual Percentage Reaching End of Life

35 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Key Findings Richmond Hill s Stormwater Management assets are primarily in good to very good condition based on their age, with a significant period of time remaining before the majority of the assets near their end of life. There is an opportunity to improve current understanding of the condition of this asset class before they near their end of life. One area for current attention is the Stormwater Management Facilities where almost 40% are predicted to be beyond their end of life. Richmond Hill has been a leader in developing asset management strategies and tools for Stormwater Management infrastructure through the introduction of the stormwater management levy, and the approval of the Town s plan to address the old Stormwater Management Facilities through a 10 year capital plan and prioritization system that evaluates, rehabilitates and brings aging facilities up to current standards for water quantity and quality control. 2.7 Water Network The Water Network is the fourth largest asset class with a current value of $127.7 million. Drinking water in Richmond Hill is purchased from York Region and is then distributed through the Town-owned and managed Water Network. The Water Network is legislated to meet stringent Provincial requirements for management practices and water quality including almost 5,000 water samples tested annually and regular audits to ensure compliance Inventory, Value and Condition Drinking water sample collection Almost 70% of the Town s Water Network by value are the watermains, which consist of km of underground pipes that carry the treated and tested drinking water to residents and businesses (Table 11). The other components of the Water Network are Water Meters (15.0%), Hydrants (8.2%) and Valves (7.9%) which are used to isolate different parts of the Water Network so maintenance can be performed. While these components have a lower value they represent over 68,000 individual components. Asset Class Table 11: Water Network Inventory and Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Water Network $ M Water Distribution $ M Watermain $ 87.9 M km Intermediate Hydrants $ 10.5 M 3,416 ea Intermediate Valves $ 10.1 M 8,075 ea Intermediate Water Meter $ 19.2 M 57,064 ea Intermediate 33

36 Overall, data confidence for the Water Network is considered to be intermediate. Stringent regulations require that Richmond Hill have a Drinking Water Quality Management System, conduct frequent testing and be subject to regular audits. These tests ensure that the Water Network performance meet legislated standards but there is less attention paid to the condition of infrastructure assets. Much of the Water Network infrastructure is underground making condition assessment challenging. Recent programs for Watermain replacement, Valve exercising, Hydrant maintenance and unidirectional Watermain flushing are steps towards a higher data confidence level. Similar to Stormwater Management, the long expected life of Water Network assets and relatively new installation of the assets is reflected in the asset condition distribution (Figure 18). 74% of the water network assets are in good or very good condition and have over half of their expected life remaining. Only 12% of the assets are predicted to be near or past end of life. Looking at the individual components of the Water Network, Watermains have a high proportion of assets (over 80%) considered to be in good or very good condition with over half of their estimated life remaining, followed by Hydrants (Figure 19). The Water Meters and Valves have more aging components with around 40% considered to be in good to very good condition and around a quarter predicted to be nearing or past end of life. All of the water meters in the Town are in the process of being replaced with meters that have wireless reading capability, which will renew this asset over the next few years. Hydrant flushing maintenance $6.4 M 5% Figure 18: Water Network Asset Condition Distribution $9.2 M 7% $17.5 M 14% $50.7 M 40% Very Good Good Fair Nearing End of Life $43.9 M 34% Beyond End of Life 34

37 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Figure 19: Water Network Components Age Distribution Water Distribution Watermain Valves Hydrants Water Meter 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life Predicted End of Life The percentage of Water Network assets predicted to reach their end of life annually over a 100 year period is less variable than other asset classes, averaging 2.0% and primarily ranging between 1% and 5% with occasional outliers (Figure 20). There is a greater concentration of assets reaching their end of life later in the 100 year time frame (between the 45 and 75 year mark) due to the pattern of development in Richmond Hill over the past 30 years. 7% 6% 5% 4% 3% 2% 1% 0% 2014 Figure 20: Water Network 100 Year Annual Percentage Reaching End of Life Key Findings Richmond Hill s Water Network assets are primarily in good to very good condition with a significant period of time remaining before the majority of the assets near their end of life. This highly regulated area already has stringent system management and performance monitoring requirements. Aging water meters are being replaced with meters that have wireless reading capability, improving the asset condition and providing an operational cost savings. There is an opportunity to pay increased attention to condition assessment through the Valve Exercising and Watermain Replacement programs. Valve exercising 35

38 2.8 Wastewater Network The Wastewater Network in Richmond Hill is the fifth largest asset class with a current value of $124.0 million. Richmond Hill s responsibility is to collect wastewater from residents and businesses and convey this into larger wastewater sewers that flow to the wastewater treatment plants. Wastewater treatment is the responsibility of York Region Inventory, Value and Condition Pumping Station maintenance Most of the Town s Wastewater Network (97%) is the Sanitary Collection pipes, consisting of km of underground pipes that carry sewage to York Region s system (Table 12). This includes the sanitary lateral pipes which go from each property to Richmond Hill s collection pipe, the main sewer, and the maintenance holes that give access to inspect and maintain the system. The other component of the Wastewater Network are six Pumping Stations which collect and pump sewage from low lying areas to larger pipes that drain by gravity to the treatment plants. Asset Class Table 12: Wastewater Network Inventory and Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Wastewater Network $ M Sanitary Collection $ M km 6,728 maintenance holes Intermediate Pumping Station $ 3.8 M 6 stations Intermediate Overall, data confidence for the Wastewater Network is considered to be intermediate because condition assessment is challenging for these underground assets and real costs for replacing them are much higher than the initial costs. More frequent Closed Circuit Television (CCTV) surveillance of the wastewater pipes and the recent Inflow and Infiltration Program are steps towards a higher data confidence level. Similar to Stormwater Management, the long expected life of Wastewater Network assets and relatively new installation of the assets is reflected in the asset condition distribution (Figure 21). This shows that 85% of the assets are in good or very good condition and have over half of their expected life remaining. Only 4% of the assets are predicted to be near or past end of life. 36

39 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Figure 21: Wastewater Network Asset Condition Distribution $1.1 M 1% $51.1 M $3.6 M 41% 3% $13.8 M 11% $54.4 M 44% Very Good Good Fair Nearing End of Life Beyond End of Life Looking at the individual components of the Wastewater Network, Sanitary Collection pipes have a high proportion of assets (over 85%) considered to be in good or very good condition with over half of their estimated life remaining (Figure 22). Pumping Stations have a more balanced distribution with 27% of assets predicted to be near or past end of life. Figure 22: Wastewater Network Components Age Distribution Sanitary Collection Pumping Station 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life Predicted End of Life Looking at the next 100 years, the percentage of Wastewater Network assets predicted to reach their end of life has the lowest average annual percentage (1.1%) ranging between no investment and 4% with a couple of outliers (Figure 23). Fewer Wastewater Network components are predicted to reach end of life in the first 25 years and a heavy concentration of components reach end of life between 40 and 80 years, again due to the long expected life of the assets and the pattern of development in Richmond Hill over the past 30 years. Wastewater Network maintenance 37

40 Figure 23: Wastewater Network 100 Year Annual Percentage Reaching End of Life 6% 5% 4% 3% 2% 1% 0% Key Findings Richmond Hill s Wastewater Network assets are primarily in good to very good condition with a significant period of time remaining before the majority of the assets near their end of life. The Pumping Stations have a balanced age distribution that includes some components that are being maintained and operated beyond their predicted end of life. Incorporating data from recent monitoring programs provide an opportunity to move the Wastewater Network towards higher data confidence. 2.9 Parks & Outdoor Recreation Richmond Hill s Parks and Outdoor Recreation assets are vital components of complete communities that enhance the quality of life in Richmond Hill and advance the Town s vision of building a new kind of urban. Parks & Outdoor Recreation assets are located on over 2800 hectares of land and are Richmond Hill s sixth largest asset class with a value of $109.7 million Inventory, Condition and Value Richmond Hills Parks & Outdoor Recreation assets include 138 Neighbourhood Parks, 24 Community Parks, four Destination Parks, as well as open spaces, linear parks and urban squares (Table 13). There are many components that make up a typical park. The most obvious components are the facilities themselves the playgrounds, sports fields and waterplays. Supporting these active uses are the gazebos, walkways, benches and waste collection containers as well as the underground servicing for the lights, drainage, etc. The biggest proportion of the individual assets in parks is the Servicing & Furnishings (33%), followed by Paths & Trails (30%), Sports Facilities (18.5%) and Playgrounds & Waterplays (18.1%). Crosby Park 38

41 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Parks Sub-Component Replacement Cost (2014 dollars) Table 13: Parks & Outdoor Recreation Inventory and Current Value Data Confidence Park Classification Replacement Cost (2014 dollars) Quantity Parks & Outdoor Recreation $ M Parks & Outdoor Recreation $ M Servicing & Furnishings $ 36.5 M Basic Neighbourhood Parks $ 42.5 M 138 locations Paths & Trails $ 33.0 M Intermediate Community Parks $ 31.6 M 24 locations Sports Facilities $ 20.3 M Intermediate Open Space & Other $ 16.2 M 104 locations Playgrounds & Waterplays $ 19.9 M Intermediate Destination Parks $ 15.6 M 4 locations Urban Squares & Linear Parks $ 3.8 M 6 locations Overall, data confidence for the Parks & Outdoor Recreation is considered to be intermediate. Steps towards a higher data confidence level would be improving understanding of the servicing in older parks, conducting regular condition assessment of pathways and bridges similar to the Roadway System, and regularly tracking the inventory of assets in individual parks against as built drawings to ensure that all the components are present. Over 60% of Parks & Outdoor Recreation assets are considered to be in good or very good condition with other half of their expected life remaining (Figure 24). A smaller proportion of the assets are considered to be in fair condition (20%) with 17% of assets predicted to be nearing or past end of life. Looking further into the sub components (Figure 25), Servicing & Furnishings, Sports Facilities and Paths & Trails each have a high proportion of their assets (ranging from 60 to 75%) in good to very good condition. Only Playgrounds & Waterplays sub components are showing more aging assets with just under 40% in good or very good condition and just over 30% predicted to be nearing or past end of life. Figure 24: Parks & Outdoor Recreation Asset Condition Distribution $9.3 M 8% $9.5 M 9% $22.5 M 20% $30.6 M 28% $37.9 M 35% Very Good Good Fair Nearing End of Life Beyond End of Life 39

42 Figure 25: Parks & Outdoor Recreation Components Age Distribution Paths & Trails Playgrounds & Waterplays Servicing & Furnishings Sports Facilities 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life Predicted End of Life The percentage of Parks & Outdoor Recreation assets predicted to reach their end of life range over the next 100 years has an average of 4% per year and ranges from 1% to 8% (Figure 26). There is some volatility from year to year but no overall trend in the 100 year period suggesting that a steady replacement of assets is needed. Figure 26: Parks & Outdoor Recreation 100 Year Annual Percentage Reaching End of Life 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% Key Findings Richmond Hill s Parks & Outdoor Recreation assets are primarily in good to very good condition with the Playgrounds & Waterplays having the highest percentage of aging components. The Town has a system in place for to plan for the replacement of parks assets at their end of life but there is an opportunity to improve data confidence for all of the Parks and Outdoor Recreation assets Vehicles & Equipment Delivering Town services often requires use of vehicles and associated equipment to: plow roads, cut the grass, perform inspections and respond to fire emergency calls. The Vehicles & Equipment asset class is smaller than the preceding infrastructure asset classes and is valued at $28.4 million. 40

43 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Inventory, Value and Condition The Vehicles & Equipment asset class includes 135 vehicles (cars, trucks, vans, dump trucks) operated by various Departments, 15 vehicles operated by Richmond Hill s Fire & Emergency Services Division, plus 542 pieces of equipment such as licensed trailers, snow plow blades, sweeper attachments, chainsaws, weed eaters and push mowers (Table 14). The Town of Richmond Hill has a centralized Fleet Services group within the Operations Division that purchases, maintains and manages the vehicles and major equipment, while operational groups such as public works and parks operations purchase, maintain and manage minor equipment and use the assets to provide Town services. Asset Category Table 14: Vehicles & Equipment Inventory and Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Vehicles & Equipment $ 28.4 M Equipment, Tractors, Trailers $ 12.6 M 542 Intermediate Fire Truck $ 10.1 M 15 Intermediate Vehicle $ 5.7 M 135 Intermediate Overall, data confidence for Vehicles & Equipment is rated as intermediate. Vehicle age is not necessarily the best measure for assessing if a vehicle or piece of equipment is ready for replacement or major maintenance. For some assets the number of kilometers driven or the number of hours in service are better measures for determining condition and when replacement should be scheduled. Figure 27: Vehicles & Equipment Asset Condition Distribution $7.0 M 25% $4.2 M 15% $5.4 M 19% $8.0 M 28% $3.8 M 13% Very Good Good Fair Nearing End of Life Beyond End of Life 41

44 Figure 28: Vehicles & Equipment Components Age Distribution 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Equipment, Tractors, Trailers Fire Truck Vehicle Very Good Good Fair Nearing End of Life Beyond End of Life The Vehicles & Equipment asset class has a balanced distribution with about 40% of the fleet vehicles and equipment in good or better condition, based on age, and the same proportion predicted to be nearing or past end of life (Figure 27). The distribution is similar between the three sub classes (Figure 28) with Fire Trucks showing somewhat more aging. Four Fire Trucks reached their expected end of life in and are in the process of being replaced Predicted End of Life Looking forward, the percentage of Vehicles & Equipment assets predicted to reach their end of life over the next 100 years averages around 10% per year with periodic spikes to around 25% when high value Fire Trucks need to be replaced (Figure 29). Fleet assets have much shorter life spans than roads or buildings, and the 100 year projection shows that a steady replacement of assets is needed. 35% 30% 25% 20% 15% 10% 5% 0% Figure 29: Vehicles & Equipment 100 Year Annual Percentage Reaching End of Life Key Findings Vehicles & Equipment have a balanced age distribution that is affected by the timing of replacement for high value Fire Trucks. Combining vehicle age with other measures like kilometers driven or hours in service is an opportunity to improve data confidence. Vehicles reaching end of life over the 100 year period is orderly, showing that a steady replacement of assets that is needed in this short lived asset class. 42

45 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N 2.11 Parking Lots The Parking Lots inventory includes the lots, lighting and servicing at Town facilities such as community centres and arenas, the Operations Centre and the Municipal Offices, plus the parking lots at Town parks. This smaller asset class has a current value of $23.6 million Inventory, Value and Condition There are an estimated 4135 parking stalls in the inventory (Table 15) although the exact number of parking stalls is not known because some parking lots are either gravel surfaced or are asphalt without painted parking stall lines. Asset Category Table 15: Parking Lots Inventory and Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Parking Lots $ 23.6 M 4135 stalls at Town buildings 37 Town parks with parking lots Basic The data confidence for Parking Lots is currently low due to incomplete or aging data in the Tangible Capital Assets database. However, a condition assessment is presently underway. Data confidence is expected to increase as this project proceeds. Overall, Richmond Hill s Parking Lots are in poor condition with 34% determined to be in good or very good condition compared to 41% predicted to be beyond their end of life (Figure 30). A partial inventory and on-site condition assessment was performed in 2014 which found 12 of 35 locations (34%) in poor or critical condition. This survey is being followed up with a full inventory and condition assessment in 2016, as well as defining target levels of service for parking lots. Figure 30: Parking Lots Asset Condition Distribution $1.1 M 5% $9.4 M 41% $4.9 M 21% $4.7 M 20% $2.9 M 13% Very Good Good Fair Nearing End of Life Beyond End of Life 43

46 Predicted End of Life The percentage of Parking Lot assets predicted to reach their end of life averages annually around 5% (Figure 31) with significant volatility ranging from no investment to almost 16% per year. This volatility is unusual for an asset class that has a longer life expectancy and is caused by the small number of parking lot locations. The 100 year picture shows that steady replacement of assets is advisable and there is a need to manage the year to year fluctuations in this asset class. Figure 31: Parking Lots 100 Year Annual Percentage Reaching End of Life 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Key Findings Overall, Richmond Hill s Parking Lots are in poor condition with low data confidence. Addressing the repair and replacement backlog is complicated by the volatility of assets reaching end of life. A condition assessment of all parking lots is underway to assist in developing a program to monitor, maintain and replace parking lots moving forward Information Technology Parking lot at Elgin West Community Centre The Town s Information Technology assets, despite being a small value asset class with a current value of $16 million, are critical for Town staff to provide services to the residents of Richmond Hill. Some of the tasks the information technology assets are used for include: GIS mapping; tracking work orders; Council report preparation; scheduling maintenance activities; and managing bookings of recreation programs and facilities. The telecom assets include telephones, cell phones and the phone network used within Town buildings. The computer hardware is primarily desktop computers, but includes printers, large format plotters, and a growing amount of tablets to enable staff to perform administrative activity in the field instead of hand-writing notes and transcribing them later. 44

47 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Inventory, Value and Condition Software is almost two thirds of the value of the information technology assets and over 80% of the inventory (Table 16). The 8547 recorded software assets include office productivity software such as MS Word, Excel, Powerpoint, and more specialized software that is managed with user licenses such as Maximo (work order management system), ArcGIS, AutoCAD and PALIS (development application management system). There are many other software applications that have less name recognition that are used every day by Town staff. Asset Class Table 16: Information Technology Inventory and Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Information Technology $ 16.0 M Software $ 9.7 M 8547 Intermediate Hardware $ 5.0 M 965 Intermediate Telecom $ 1.3 M 848 Intermediate Confidence in the information technology data is intermediate, with strengths in the inventory and data consistency perspectives. The opportunities for improving confidence in the data are largely in integrating the operational management tools with the tangible capital asset database and improved reporting. Richmond Hill s Information Technology assets are aging with 56% predicted to be near or past end of life (Figure 32). Only 29% are considered to be in good or very good condition. Software is easier to replace and upgrades are often required to continue to use a service. Because of this, software has fewer assets that are predicted to be beyond end of life than the physical assets (Figure 33). The Hardware and Telecom asset age distributions reflect a large backlog of assets nearing and past their end of life. Similar to more traditional infrastructure assets, Information Technology assets that are beyond their end of life are subject to increased failure rates and these failures are unpredictable. End of life Information Technology assets are also often no longer supported by the vendor, which impacts the Town s ability to receive technical support assistance and hardware replacements. Additionally, as these assets age they gradually do not perform as well, becoming slower and providing lower functionality over time. Operating information technology assets beyond their end of life is not a safety risk, and has low risk to service delivery, instead the impacts are increasing costs and lower productivity. The recent purchase of the Maximo work order management software and planned replacement of the PALIS, CLASS, CRM and ReCAPP software are helping keep the Town s capabilities current. 45

48 Figure 32: Information Technology Asset Condition Distribution $5.1 M 32% $3.9 M 24% $2.6 M 17% $2.4 M 15% $1.9 M 12% Very Good Good Fair Nearing End of Life Beyond End of Life Figure 33: Information Technology Components Age Distribution Software Hardware Telecom 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life Predicted End of Life Looking forward, the percentage of Information Technology assets predicted to reach their end of life averages annually around 15% (Figure 34). With many of the assets having expected lifespans of 5 or less years, the predicted end of life replacements are relatively flat, showing a steady need for upgrades and replacements. Figure 34: Information Technology 100 Year Annual Percentage Reaching End of Life 35% 30% 25% 20% 15% 10% 5% 0%

49 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Key Findings Richmond Hill s Information Technology assets are a small value but important asset class. A large proportion of these assets are predicted to be near or past their end of life, especially the Telecom and Software assets. Over time, Information Technology assets become less functional and perform slower, have increasing failure frequencies, and eventually are no longer supported by the vendor which dramatically increases the cost and risk when replacing the assets. Major investments in upgrading Information Technology are underway and an Information Technology Strategy is being developed to help prioritize investments Other Equipment & Materials The Other Equipment & Materials asset class is comprised of many low cost items that considered together have significant capital cost. The overall value of this asset class is $23.1 million. While not usually considered to be infrastructure, this asset class will benefit from the rigour of being included in the Town s capital asset management framework Inventory, Value and Condition Library assets: books and shelving Many of the assets in the Other Equipment & Materials class are not individually recorded in the tangible capital asset inventory. Rather they are treated as pooled assets and assigned a replacement value rather than a quantity. This asset class includes all of the materials in the Town s libraries such as: books, audio and video materials (Library Materials); furniture and computer equipment (Library Equipment); and non-motorized equipment and machinery such as lifesaving self-contained breathing apparatus for fire fighters (Fire Equipment) as well as automated external defibrillators, recreation equipment such as treadmills and bike racks, time clocks and sound systems (Other Equipment). The Library Materials and Library Equipment are the majority of this asset class comprising almost 75% of the overall value. Asset Class Table 17: Other Equipment & Materials Inventory and Current Value Replacement Cost (2014 dollars) Data Confidence Other Equipment & Materials $ 23.1 M Library Materials $ 11.1 M Basic Library Equipment $ 6.1 M Basic Fire Equipment $ 4.0 M Intermediate Other Equipment $ 1.9 M Basic 47

50 Figure 35: Other Equipment & Materials Asset Condition Distribution $1.5 M 6% $1.8 M $3.2 M 8% 14% $5.7 M $10.8 M 25% 47% Very Good Good Fair Nearing End of Life Beyond End of Life Figure 36: Other Equipment & Materials Components Age Distribution Library Materials Library Equipment Fire Equipment Other Equipment 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Very Good Good Fair Nearing End of Life Beyond End of Life Overall, the Other Equipment & Materials asset class has a balanced range of ages, which is what would be expected with short-lived equipment and materials that are being continually replaced. The proportion in good to very good condition is 55% with 25% in fair condition and 20% predicted to be near or past end of life (Figure 35). Looking at the asset subclasses, the majority of the Library Materials are in good to very good condition. There are no assets in this class predicted to be near or past end of life due to the way these pooled assets are recorded in the TCA database. Because new library materials are purchased each year to replace worn, damaged or lost materials, the overall inventory is kept steadily in the good range. Other Equipment also has a high proportion in good to very good condition for similar reasons. In contrast, Library Equipment assets are largely predicted to be nearing or beyond their expected end of life. The Fire Equipment asset age distribution is heavily influenced by a single item, the radio dispatch system, which is nearing its end of life and has a replacement cost of approximately 22% of the total value of Fire Equipment category. 48

51 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Predicted End of Life The percentage of Other Equipment & Materials assets predicted to reach their end of life averages annually around 12% (Figure 37). The spikes in the projected end of life highlight when higher value assets are anticipated to be at their end of life. The 100 year picture shows that a steady replacement of low value assets is needed. Figure 37: Other Equipment & Materials 100 Year Annual Percentage Reaching End of Life 60% 50% 40% 30% 20% 10% 5% Key Findings The Other Equipment & Materials asset class is comprised of many low cost items that are not usually considered infrastructure. When considered together they have significant capital cost and would benefit from the rigour of being included in the Town s capital asset management framework. Overall, the Other Equipment & Materials asset class has a balanced range of ages which is what would be expected with short-lived equipment and materials that are being frequently replaced Environmental Assets Richmond Hill is proud to be a leader in environmental practices and a community that is strongly committed to protecting the environment. One of the ways the Town is showing leadership is by bringing Environmental Assets as an asset class into our first corporate Asset Management Plan, including Richmond Hill s urban forest, valleylands and streams. While these types of assets are not typically included in Asset Management Plans, Richmond Hill already has well defined programs and commitments to manage our Environmental Assets and welcomed the opportunity to start to apply the same rigour to these assets as we apply to the rest of our asset classes. Our Environmental Assets include over 43,000 trees along streets and sidewalks, over 2 million estimated trees in our parks and natural areas and 150 kilometers of streams and associated valleylands of which approximately 50% is owned or managed by the Town. These assets provide habitat for plant and animal species including several sensitive and locally rare species (see text box). Inventory and condition information at this point in time is limited to Street Trees and Natural Forest Areas. Environmental Assets are linked to other asset classes. For example, a significant proportion of our urban forest is associated with Parks and Outdoor Recreation assets. The urban forest also plays a role in reducing the initial volume of stormwater runoff that makes its way into Stormwater Management assets. 49

52 Inventory, Value and Condition There are 43,217 inventoried Street Trees in Richmond Hill with a current replacement value of approximately $13.4 million (Table 18) based upon a $310 replacement cost per street tree. Park Trees have not yet been inventoried but this effort is underway. The remainder of the urban forest, primarily trees and shrubs in natural areas, is inventoried and valued by the area and type of forest because these trees are not managed individually. Collectively, inventoried natural areas comprise about 1066 hectares and contain a range of different vegetation communities. The most Biodiversity in Richmond Hill The 2014 inventory and assessment of Richmond Hill s plant and animal diversity and health identified that the Town is benefiting from being connected to the Oak Ridges Moraine, with some of the highest biodiversity in the Greater Toronto Area. 223 vegetative communities 918 flora species with 271 species of regional concern 149 fauna species with 111 species of regional & urban concern common vegetation communities (Figure 38) are Deciduous Forest (24.7%), Cultural Plantations (22.3%) and Cultural Meadows (15.0%). There are just under 700 hectares dominated by trees and shrubs that are considered to be Natural Forest Areas. The replacement value for the forest areas is over $74 million based upon a restoration cost of $106,700 per hectare. Asset Class Table 18: Environmental Assets Inventory and Current Value Replacement Cost (2014 dollars) Quantity Data Confidence Street Trees $13.4 M 43,217 trees Intermediate Natural Areas - Forest $74.2 M hectares Intermediate Figure 38: Vegetation Communities in Richmond Hill s Natural Areas Deciduous Forest 0.2% 1.8% 1.9% 1.9% 2.4% 24.7% 3.7% 4.7% 6.7% 6.8% 6.8% 22.3% 15.0% Cultural Cultural Meadows Cultural Woodlands Marsh Swamp Mixed Forest Shallow Open Water Coniferous Forest Thickets 50

53 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N East Humber Trail Confidence in Environmental Asset data for Street Trees and Natural Areas is intermediate. A recent inventory of the Street Trees with processes in place to keep the data up to date in the GIS database is a strong approach, but the absence of age information limits confidence in the asset condition data. For the Natural Area Vegetation, the information is of leading edge quality, but the Town-owned areas were not separated during data collection which limits the confidence that can be assigned. Age information is not available for either the Street Trees or the Natural Forest Areas. The Street Tree database contains trunk diameters (used to infer age) which seems to indicate that a high percentage of trees in Richmond Hill are young, but this data is out of date. The condition of Street Tree assets is determined by looking at the proportion of branches which are in poor health (Table 19). Richmond Hill s street trees are largely in Good condition (62%) with almost no trees Nearing or Beyond End of Life condition (Figure 40), demonstrating that the tree pruning and replacement programs appear to be working reasonably well. However, over 7,000 Ash trees are at risk due to the Emerald Ash Borer. Table 19: Tree Condition Rating Systems % Dieback of Branches Tree Condition Rating AMP Condition Rating (< 1 dieback) Excellent Very Good 1-10 Good Good Fair Fair Poor Nearing End of Life Critical Beyond End of Life Dying Beyond End of Life no leaves Dead Beyond End of Life 51

54 Figure 39: Environmental Assets Condition Distribution 2.8% 8.6% 66.3% 22.83% Good to Very Good Fair Nearing End of Life Beyond End of Life Figure 40: Environmental Assets Condition Distribution by Subclass Street Trees Natural Forest 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% The condition of Natural Forest Area communities is significantly determined by their susceptibility to disturbances such as the recent Emerald Ash Borer infestation and the extent of invasive plant species such as European Buckthorn. The single biggest impact on tree condition is from the Emerald Ash Borer beetle which is expected to result in mortality of nearly 12% of the Town s tree canopy. Because Ash trees are a common species in 65% of the Town s Natural Forest Areas, only 22.3% of Richmond Hill s Natural Forest Areas are predicted to be in good to very good condition, with 66.3% in Fair condition and 11.4% predicted to be Nearing or Beyond End of Life Predicted End of Life Very Good Good Fair Nearing End of Life Beyond End of Life Trees and other environmental assets do not have a fixed end of life like traditional constructed infrastructure assets like roads, buildings and vehicles. Instead of estimating when an individual tree will die or need to be replaced, estimates can be made that apply across the large population of trees. A mortality rate identifies what percentage of trees or other environmental assets which need to be replaced or restored for reasons such as weather damage, impacts from vehicles or equipment, disease or natural mortality. The percentage of the Street Trees predicted to reach their end of life range annually is 3.5% which is based upon historical street tree management records. The percentage of Natural Forest Areas predicted to reach their end of life is lower, predicted to be 1% per year, since healthy forest areas promote regeneration. These rates may show fluctuations over a 100 year period like other asset classes due to disturbances like climate change and invasive diseases and insects. 52

55 State of Local Infrastructure R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Key Findings Richmond Hill is breaking new ground by including Environmental Assets in the Town s Asset Management Plan. The inventory and condition is limited to Street Trees and Natural Forest Areas at this time, although there is an opportunity to include Park Trees and Streams in future updates of the Asset Management Plan. The inventory and condition of the Street Trees and Natural Forest Areas is of intermediate quality. There is an opportunity to improve data confidence by including age of street trees in the database. The majority (62%) of Richmond Hill s Street Trees and Natural Forest Areas are in fair condition (Figure 39), primarily due to the damage caused by the Emerald Ash Borer beetle, but few trees are in poor or worse condition (7%). The percentage of Street Trees expected to reach their end of life annually is predicted to be 3.5% and the percentage of Natural Forest Areas is predicted to be 1% due to the ability of healthy forests to naturally regenerate Conclusions Richmond Hill has $1.85 billion in infrastructure assets and an additional $87.6 million in Environmental Assets. The largest asset classes are the Roadway System (33%), Buildings (24%) and the Stormwater Network (18%) which together comprise 75% of the total asset value. The Water, Wastewater, and Parks & Outdoor Recreation asset classes, while smaller, are still significant, each with values over $100 million. The majority of Richmond Hill s growth has occurred over the last four decades and the Town s assets are relatively new. Based upon their age, 61% of assets are considered to be in good or very good condition. Parking Lots and Information Technology have the highest percentage of their assets Near or Beyond End of Life and have activities planned in 2016 to improve the overall condition of these assets. There are opportunities in every asset class to improve the data quality and reporting capabilities and improve data confidence. Specific opportunities include putting in place a regular condition assessment of all asset classes, developing an inventory and condition methodology for Heritage Buildings and integrating additional Environmental Assets, Entrance Features and Decorative Walls and Gates into the inventory. George Forster House 53

56 3.0 Levels of Service In the State of Local Infrastructure chapter, the value and condition of Richmond Hill s infrastructure assets were presented based upon the expected lifespan of those assets. builds on this by defining the minimum condition that assets should be maintained at during their expected lifespan. It answers the question, how are they performing? For example, the expected lifespan of the surface of a local street may be 20 years, but this expected life is only meaningful if the driving surface remains in an acceptable condition over that timeframe. That acceptable condition is known as the Level of Service. 54 Central Library

57 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Levels of service can mean different things in different contexts. Best practice recommends that levels of service focus on quantifying asset performance criteria and how deficiencies are addressed. In the Richmond Hill asset management context, levels of service have been defined to include: Target Condition: what properly functioning assets looks like and achieve Performance Measure: how the target condition is measured Target: the minimum performance or physical characteristic threshold for an asset before repair, replacement or maintenance is required, and/or the timeframe to restore an asset to proper performance Richmond Hill s levels of service are first and foremost focused on meeting regulatory requirements. As regulatory requirements are more focused on the safety than sustainable long term asset condition or providing quality of life in the community, Richmond Hill also has levels of service for asset condition and community satisfaction. Condition based levels of service set standards above the minimum required by regulations for items like the smoothness of road surfaces or the condition of our community centres. The Drivers for Richmond Hill s asset management levels of service: Regulatory requirements Best practices for sustainable asset management Community satisfaction Municipal priorities such as environmental benefits, community benefits and beautification. Town s community satisfaction survey, conducted every few years, provides a high-level indication of whether the asset management levels of service and maintenance strategies are meeting the expectations of residents. Richmond Hill Centre for the Performing Arts This chapter will present levels of service for assets as they are today in Richmond Hill as a starting point for future improvements. Levels of service for each Asset Class, and asset Subclass where applicable, are described in Sections 3.1 to While all asset classes currently have at least a basic level of service defined, some assets are more thoroughly covered than others. 55

58 In many cases, the existing levels of service are incomplete, such as where there are performance measures but no associated targets. These performance measures may still be valuable even without a firm target value, as they allow us to look at trends - comparing current results with previous ones. Moving forward, there is an opportunity for all asset classes to incorporate methodologies from other parts of the organization, perform benchmarking and improve comprehensiveness. The Town is currently (2016) undertaking levels of service studies for the roadway system and parks; as well as a fleet utilization study. The results of these studies will be integrated in future versions of the Asset Management Plan. 3.1 Roadway System Target Condition and Function A well-functioning roadway system has roads and sidewalks that are smooth, clean, safe, durable, well lit, and drain well; bridges and culverts that are stable and in a state of good repair, with unobstructed flow through the structure; traffic signals that provide reliable control of intersections, and clear direction to motorists and pedestrians; and regulatory signs that are in place and visible Levels of Service Yonge Street in Downtown Richmond Hill Levels of service for Richmond Hill s roadway system (Table 20) are primarily defined by Provincial legislation, specifically the: Ontario Minimum Maintenance Standard (MMS) and Standards for Bridges. As these standards are focused on safety rather than long-term sustainability of asset condition, Richmond Hill maintains additional levels of service for the Roadway Surface, and Sidewalks & Walkways, that go beyond the legislated requirements. A community survey also solicits resident feedback on satisfaction with Richmond Hill s roads, another aspect of measuring levels of service. Further development of levels of service for the Roadway System is underway in 2016 as part of the Roads & Traffic Operations Levels of Service Study. This study will expand condition based levels of service to a wider range of Roadway System assets, including establishing target conditions and performance measures External Trends and Issues The Roadway System is highly integrated with the other infrastructure located under the road surface, such as water, wastewater and stormwater assets. The levels of service for the roadway can therefore affect the condition and longevity of these other assets. For example, water infiltration from the road surface into the road bed can damage the underground assets. Conversely, failure to meet the levels of service for water, wastewater and stormwater assets can damage the roadway itself, with the potential for water leaking from pipes and undermining the road bed. 56

59 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N There are some external influences on the Roadway System that need to be considered when planning for levels of service. One is the relationship between the Town of Richmond Hill and York Region. The Region owns and operates arterial roads, transit and some street lighting. There is an extra level of coordination required when roadwork is necessary on a road that connects to a Regional road. Climate change is another influence, with increased risk of flooding of the roadway, driving changes to design specifications Key Findings The maturity of the asset management practices for roads assets is reflected in the many levels of service for Richmond Hill s Roadway System, based upon regulatory, condition and resident satisfaction performance measures. Richmond Hill roads consistently meet the Pavement Quality Index (PQI) targets, and resident satisfaction is stable. There are two major opportunities for improvement. First, many of the performance measures lack defined targets and establishing targets will provide a clearer measure of whether roadway assets are performing adequately. Second, there is a data management challenge with reporting on regulatory performance. The work is being done to meet the Ontario Minimum Maintenance Standards, but the system of tracking work orders for the thousands of minor repairs performed on the roadway system each year requires new data management processes and tools. Improving reporting through the new Work and Asset Management System is an opportunity. Table 20: Roadway System Levels of Service and Community Satisfaction Measures Asset Performance Measure Measure Type Target Results ( ) Roadway System Road Reconstruction Priority Rating System Asset Condition No target defined Priority projects incorporated into ten year capital forecast Road bed & Road surface Ontario Minimum Maintenance Standards (MMS) for Potholes, Shoulder drop-offs, Cracks, Debris, Bridge deck spalls, Roadway surface discontinuities, Signs Regulatory Meet or exceed Minimum Maintenance Standards (MMS) Reportable on a case by case basis Pavement Quality Index (PQI): % Condition PQI greater than or equal to 70% 2013: : : 80 Road Condition: % in Good or Very Good Condition Condition No target defined 2012: : 92.0 Road Quality and Maintenance: % Satisfied or Very Satisfied Community Survey No target defined 2012: : 79 57

60 Table 20: Roadway System Levels of Service and Community Satisfaction Measures Asset Performance Measure Measure Type Target Results ( ) Bridges & Culverts Ontario Standards for Bridges Regulatory Meet or exceed Ontario Standards for Bridges Reportable on a case by case basis Bridge Condition: % in Good or Very Good Condition Condition No target defined 2012: : 100 Traffic Signals Ontario Minimum Maintenance Standards (MMS) for Traffic control systems, subsystems Regulatory Meet or exceed Minimum Maintenance Standards (MMS) Reportable on a case by case basis Street Lights Ontario Minimum Maintenance Standards (MMS) for Luminaires Regulatory Meet or exceed Minimum Maintenance Standards (MMS) Reportable on a case by case basis Streetlighting: % Satisfied or Very Satisfied Community Survey No target defined 2012: : 87 Sidewalks & Walkways Ontario Minimum Maintenance Standards (MMS) for Sidewalk surface discontinuities Regulatory Meet or exceed Minimum Maintenance Standards (MMS) Reportable on a case by case basis Sidewalk Condition Rating Condition No target defined Reportable on a case by case basis Sidewalks: % Satisfied or Very Satisfied Community Survey No target defined 2012: : Buildings Target Condition and Function Well-functioning buildings provide reliable, safe and predictable access and amenities for the purposes for which they were designed, such as arenas, community gyms, meeting rooms or swimming pools. Mechanical, electrical and architectural components perform in a way they do not detract from the experience or purpose of the building while minimizing energy and water usage. Oak Ridges Community Centre 58

61 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Levels of Service The levels of service for the Buildings asset class are largely focused on the condition of the buildings, measuring the extent and timeliness of maintenance and reinvestment (Table 21). The primary level of service is an overall target condition for the Town s buildings, using the industry standard Facility Condition Index (FCI) measure (see text box). The Facility Condition Index is a measure of annual reinvestment needed to maintain the building at or above a specified condition. In Richmond Hill s case, the Council adopted target for building condition is 7% which will maintain buildings in an overall Fair condition. Other levels of service include following the manufacturer s recommended preventative maintenance schedules, a target timeframe for routine and urgent repairs to be completed, patron satisfaction with the condition of recreation facilities and replacement of components at their end of life. Regulatory requirements for energy conservation and accessibility are met through the annual capital reinvestment program. Facility Condition Index FCI Rating Risk of Failure Impact on Operations Impact on Functionality <5% Good Operational and maintenance costs will be predictable The asset will provide a clean and functional environment 5%-10% Fair Unplanned component failure in facility is unlikely 10%-30% Poor Unplanned component failure in facility is likely >30% Critical Unplanned component failure will occur There may be some variability in operational cost Operational costs including unplanned repair and maintenance will be high Operational costs including emergency repair and maintenance will be high The asset will meet most operational needs with minor complaints The asset will look worn with serious signs of deterioration The asset will look worn with serious signs of deterioration; functionality of the entire asset will be compromised External Trends and Issues The Town s Buildings have a long history of best practice in asset management and the risks are relatively well understood. Richmond Hill has recently implemented a level of service framework for much of its Buildings portfolio and invested in the Maximo work and asset management system to track preventative maintenance, repairs and end of life replacement forecasts. The primary risks to levels of service in Buildings in Richmond Hill are the replacement of the lifecycle planning software for buildings components which guides capital reinvestment, and the potential for additional regulation related to energy usage and emissions. 59

62 3.2.4 Key Findings A Facility Condition Index target of 7% has been adopted by Council which is intended to keep the Town s buildings in fair condition over the long term. The Buildings levels of service include measures for condition, repairs and safety, resident satisfaction, preventative maintenance and capital reinvestment, which is one of the Town s most complete frameworks. Similar to the Roadway System, there is an opportunity to set additional targets to measure performance and there is a data management opportunity to improve reporting on repair responsiveness and preventative maintenance to meet manufacturer s specifications. The system to track the thousands of work orders performed on the buildings each year has recently been upgraded and new data management processes and tools are being developed. Asset Table 21: Buildings Levels of Service and Community Satisfaction Measures Performance Measure Measure Type Target Results ( ) Buildings Energy Conservation Regulatory * Energy consumption reduced by 8.5% (4.1 million ekwh/year) over the life of the plan Annual Consumption 2012: 48.1 million ekwh 2013: 52.1 million ekwh 2014: 56.0 million ekwh Facility Condition Index (FCI) Condition 7% Results not available Repair Responsiveness: Routine Repairs Safety & Condition Completed with 14 days Reportable on a case by case basis Repair Responsiveness: Urgent Repairs Safety & Condition Completed within 48 hours Reportable on a case by case basis Recreation Facilities: % Satisfied or Very Satisfied Community Survey No target defined 2016: 91% Mechanical subcomponents Manufacturer s recommended scheduled maintenance Best Practice No target defined Reportable on a case by case basis *There is a regulatory requirement to report on energy consumption; the targets set by the Town are best practice, not regulatory. 3.3 Stormwater Management Target Condition and Function Well-functioning Stormwater Management assets provide unobstructed flow of water from rainfall events into the storm sewer piping system and stormwater management facilities, and release that water in a controlled manner to rivers and streams, protecting the community from flooding, and the natural environment from erosion and water quality impacts. 60

63 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Levels of Service Levels of service for the stormwater management asset class are a mix of regulatory requirements and performance measures to identify priorities for end of life replacement (Table 22). The Town is required to comply with conditions in the Environmental Compliance Approval (ECA) for each stormwater management facility, keeping them in good working order. The legislated requirements for stormwater management focus on the end of pipe quality and rate of the water discharge that flows into natural watercourses, as well as ensuring the components of the facility are in good working order and there is adequate capacity in the facility. The condition of the stormwater network assets is considered in the Road Reconstruction Priority Rating System, monitoring and ensuring that there is adequate drainage for the roadway and that the catchbasins and drainage pipes are in good repair. Similarly, the Stormwater Management Facility Prioritization system defines criteria for rehabilitation and replacement of the stormwater management facilities based upon condition and risk. Both the Road Reconstruction Priority Rating System and the Stormwater Management Facility Prioritization System identify priorities for the 10 year capital investment plan, based on the prioritization scores from these systems External Trends and Issues There is strong coordination and integration between the Stormwater Management asset management strategies and the management of the Roadway System assets as much of the stormwater network provides drainage from the road surface and is located under the road bed. The major risk to maintaining levels of service for stormwater assets is the changing weather conditions associated with climate change. These changing conditions have the potential to render stormwater assets ineffective to handle storms long before these assets reach their end of life. Stormwater management continues to evolve rapidly and levels of service need to take into consideration new stormwater treatment technologies as well as source and conveyance controls. The Town of Richmond Hill and the Toronto and Region Conservation Authority (TRCA) are working together to address watershed management issues Key Findings The current focus of the levels of service for Stormwater Management assets is on complying with regulatory requirements and on identifying priorities for end of life replacement. There is an opportunity to implement a level of service for underground stormwater pipes aligned with the scheduled camera inspection program to assess condition of these assets every five years. Climate change is the single biggest risk to maintaining levels of service, and Richmond Hill and other agencies involved in Stormwater Management are planning for mitigation and adaptation strategies. Stormwater management water quality testing 61

64 Table 22: Stormwater Management Levels of Service and Community Satisfaction Measures Asset Performance Measure Measure Type Target Results ( ) Stormwater Network Road Reconstruction Priority Rating System Asset Condition No target defined Priority projects incorporated into ten year capital forecast Stormwater Management Facility Environmental Compliance Approval (ECA) requirements Regulatory Meet or exceed the conditions in the Environmental Compliance Approval (ECA) requirements for each facility Reportable on a case by case basis Stormwater Management Facility Prioritization System Asset Condition No target defined Priority projects incorporated into ten year capital forecast 3.4 Water Network Target Condition and Function A well-functioning Water Network distributes treated drinking water to customers while ensuring that water quality and system pressure meet regulated requirements. Richmond Hill s drinking water comes from York Region, who in turn receives the water from treatment plants in the City of Toronto and the Region of Peel. The Town is responsible for distributing the water to residents and businesses Levels of Service The provision of drinking water is highly regulated in Ontario. As a result, the majority of levels of service for the Water Network arise from regulatory requirements to ensure a high level of oversight in the operation and maintenance of the water network including frequent water quality testing and strict corrective actions in situations where the safety of the water could be at risk (Table 23). Thousands of water samples are tested each year and the percentage of samples requiring resampling due to water quality concerns is one measure which reflects on the condition of the water network. The asset condition of the Water Network is directly addressed in existing replacement programs for Water Meters and Watermains, as well as in the Road Reconstruction Priority Rating System as part of the end of life analysis of the Roadway System and the associated water, wastewater and stormwater networks. For asset replacement decisions, performance measures like the number of watermain breaks are important, as is the Infrastructure Leakage Index, a regional measure of the amount of water lost due to leaks in the pipes and valves. Satisfaction with the delivery of water services and sewage services is high, having risen from 92% in 2012 to 95% in

65 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N External Trends and Issues The largest risk for the heavily regulated water network is the multi-jurisdictional model by which water is treated and supplied. Richmond Hill relies on other jurisdictions for our supply of water, and there is potential for population growth to outpace the capacity of the water supply and distribution network. This requires careful planning and coordination Key Findings Drinking water sample collection The current focus of the Water Network asset levels of service is on complying with the extensive regulatory requirements that govern the provision of drinking water in Ontario and identifying priorities for end of life replacement. As a result, levels of service are well defined for the assets in the Water Network and results are available to track progress. Resident satisfaction is high with these services. Water Network assets have a long life expectancy and the Town has levels of service based upon asset condition to integrate the replacement of these assets with the other infrastructure located under the Roadway System. The Watermain Restoration Program uses water main break data to identify and prioritize locations for major restoration work. Most of the performance measures lack targets, an area to improve in future versions of the asset management plan. Asset Table 23: Water Network Levels of Service and Community Satisfaction Measures Performance Measure Measure Type Target Results ( ) Water Distribution Water Testing: # of samples requiring resampling Regulatory No target defined 2012: 7 of : 14 of : 22 of : 14 of 4895 Watermain Restoration Program Asset Condition No target defined New program. Results not available yet. Road Reconstruction Priority Rating System Asset Condition No target defined Priority projects incorporated into ten year capital forecast Watermain Breaks Water & Sewage Systems: % Satisfied or Very Satisfied Infrastructure Leakage Index Asset Condition Community Survey Asset Condition No target defined 2012: : 46 No target defined 2012: : 95 < :

66 3.5 Wastewater Network Target Condition and Function A well-functioning Wastewater Network collects sewage from homes and businesses and transports this sewage to wastewater treatment plants, where it is appropriately treated before being released to the environment. Richmond Hill is responsible for the collection of sewage from individual properties. This sewage flows into large wastewater pipes, owned and operated by York Region, and ultimately to a wastewater treatment plant jointly owned and operated by York Region and Durham Region Levels of Service Levels of service for the wastewater network asset class are predominantly driven by identifying and eliminating sources of water infiltration into the wastewater system. Inflow of stormwater and groundwater into the wastewater system increases the total volume that must be processed and the associated costs. Stormwater infiltration can also cause localized flooding and sewer backups which are both highly undesirable. The Town of Richmond Hill is participating in the Regional Inflow & Infiltration Reduction Strategy. The regional target is to reduce inflow and infiltration by 40 million litres per day (MLD) between 2011 and 2031 (Table 24). Looking more directly at asset condition, the wastewater network is included in the Road Reconstruction Priority Rating System, identifying where there are opportunities to coordinate work on the roadway assets and wastewater network assets. Satisfaction in the delivery of wastewater services is combined with water supply and is high having risen from 92% in 2012 to 95% in External Trends and Issues The key risks associated with this long-lived asset class are associated with inflow and infiltration of stormwater overwhelming the capacity of the system to carry its designed sewage flows, and the multi-jurisdictional model by which sewage is collected and treated and the potential for population growth to outpace the capacity of the wastewater system, either within or downstream of Richmond Hill s network Key Findings The current focus of the wastewater network asset levels of service is on minimizing inflow and infiltration of stormwater and groundwater, a regional priority, and on identifying priorities for end of life replacement. Resident satisfaction is high with the wastewater services. Wastewater network assets have a long life expectancy and the Town has levels of service based upon asset condition to integrate the replacement of these assets at the end of life with the other infrastructure located under the Roadway System. There is an opportunity to implement a level of service for underground wastewater pipes aligned with the scheduled camera inspection program to assess the condition of these assets every five years. Most of the performance measures lack targets, an area to improve in future versions of the asset management plan. 64

67 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Table 24: Wastewater Network Levels of Service and Community Satisfaction Measures Asset Performance Measure Measure Type Target Results ( ) Sanitary Collection Inflow and Infiltration Asset Condition Contribute to Regional goal of 40 MLD reduction New program. Results not available yet. Road Reconstruction Priority Rating System Asset Condition No target defined Priority projects incorporated into ten year capital forecast Water & Sewage Systems: % Satisfied or Very Satisfied Community Survey No target defined 2012: : Parks & Outdoor Recreation Target Condition and Function Well-functioning Parks & Outdoor Recreation assets provide reliable, safe and predictable outdoor access and amenities for residents to be active and involved as well as contributing to environmental protection Levels of Service There are few levels of service for the Parks & Outdoor Recreation asset class (Table 25). Most of the focus for this asset class is on operations and maintenance to facilitate the large number of people that use these facilities on a daily basis, without target conditions being set for the assets themselves. One area where there is a clear level of service requirement is for playgrounds which are assessed against the standard CSA Z614 Children s Playspaces and Equipment. Mary Dawson Park Additional levels of service arise from Richmond Hill s community survey program which includes parks assets, and a Parks Redevelopment prioritization rating process that includes condition of assets that are nearing end of life as one consideration. There is also a capital replacement program that is based upon lifecycle condition of parks assets, but the absence of performance measures or targets makes this program difficult to link to a level of service. Further development of levels of service for Parks & Outdoor Recreation assets is underway in 2016 and 2017 as part of the Parks Operations Levels of Service Study. This study will expand condition based levels of service to a wider range of parks assets, including establishing target conditions and performance measures for the assets. 65

68 3.6.3 External Trends and Issues The key factor affecting the delivery of service levels in parks and outdoor recreation is the ability to acquire sufficient parkland in intensifying areas of the Town. Over-use of assets in certain areas may also make it difficult to keep pace with service level expectations from the community. Additional analysis into this asset class will require the establishment of more comprehensive service levels for asset condition Key Findings While there is an extensive number of operating and maintenance activities carried out to ensure that parks assets are being kept in a safe, enjoyable condition, levels of service for the condition of Parks & Outdoor Recreation assets are currently poorly defined. A Parks Operations Levels of Service Study is underway which will provide performance measures and targets to incorporate into future asset management plans. Table 25: Parks & Outdoor Recreation Levels of Service and Community Satisfaction Measures Asset Performance Measure Measure Type Target Results ( ) Playgrounds Canadian Standards Association (CSA Z614) requirements Regulatory Meet or exceed Canadian Standards Association (CSA) requirements for each facility Reportable on a case by case basis Parks & Outdoor Recreation Parks Redevelopment Prioritization Rating System Asset Condition No target defined Priority projects incorporated into ten year capital forecast Parks, Open Space and Pathways: % Satisfied or Very Satisfied Community Survey No target defined 2012: : Vehicles & Equipment Target Condition and Function Well-functioning Vehicles & Equipment assets support the delivery of municipal services and the management of assets; they meet all regulated requirements, and are safe and efficient to operate Levels of Service Vehicles and equipment are a highly regulated asset class. As a result, the majority of levels of service involve meeting the regulations for commercial and off road vehicles (Table 26). Other levels of service include following the manufacturer s recommended preventative maintenance schedules and guidelines for disposal of the assets at end of life. Additionally a fleet utilization policy to right size the fleet and better align individual fleet vehicles for the uses intended, including the provision of energy efficient vehicles, is being developed in

69 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N External Trends and Issues As shorter-lived assets, there are few risks that can affect the asset management of existing vehicles, but substantial changes to the vehicle fleet composition may be required in the coming years. These changes may include emissions reduction requirements, increased expectations for use of electric vehicles and charging stations, autonomous (self-driving) vehicles and use of alternative fuels Key Findings The current focus of the Vehicles & Equipment asset levels of service is on: complying with the extensive regulatory requirements that govern commercial and off road vehicles in Ontario, following manufacturers recommended maintenance schedules, and identifying vehicles for end of life replacement. As shorterlived assets that are easily seen and managed, Richmond Hill has developed good practices for maintenance, repair and replacement. Though Richmond Hill is meeting the regulatory requirements and is following best practice, there is a data management opportunity to improve reporting. There is also an opportunity as part of the Fleet Utilization Review to establish guidelines for right sizing the fleet and better aligning individual vehicles with their intended uses. Fire Truck Asset Performance Measure Table 26: Vehicles & Equipment Levels of Service Measure Type Target Results ( ) Vehicles & Equipment Ontario Ministry of Transportation Requirements Regulatory Meet or exceed Ministry of Transportation requirements for each vehicle Reportable on a case by case basis Manufacturer s recommended scheduled maintenance Best Practice No target defined Reportable on a case by case basis Fleet Disposal Guideline Condition No target defined Reportable on a case by case basis Energy Efficiency Best Practice No target defined Reportable on a case by case basis 67

70 3.8 Parking Lots Target Condition and Function Well-functioning Parking Lots have driving surfaces and sidewalks that are smooth, clean, safe, durable, well lit, and that drain well, with signs and markings that provide clear direction to motorists and pedestrians Levels of Service Levels of service for parking lots assets are under development in 2016 as part of the Roads & Traffic Operations Levels of Service Study. The levels of service are anticipated to closely follow the Ontario Minimum Maintenance Standards for Roadways, interpreting them for their applicability in parking lots. Currently asset management decisions for Town parking lots rely on the judgment of Town staff Key Findings A condition assessment of all parking lots is underway which will result in service levels being defined and an orderly program being developed to monitor, maintain and replace parking lots, moving forward. 3.9 Information Technology Target Condition and Function Well-functioning Information Technology assets support the delivery of municipal services and the management of assets; they provide a reliable, efficient and secure environment for the storage and use of information Levels of Service Levels of service for the Information Technology asset class are predominantly driven by best practice, including replacing desktop computers and network components based on functionality rather than avoiding failures, and offering technical service through the eservice initiative. There are no formal levels of service related to the condition of hardware assets, telecommunications assets or software assets External Issues and Trends Richmond Hill has a number of risks and asset management challenges that are associated with the rapidly changing Information Technology sector. These risks include the need to update foundational Information Technology systems to support newer application technologies, software upgrade delays where the rollouts are complicated by bypassing some versions to the most recent version, and maintenance of proprietary applications that are no longer supported. These risks emphasize the need for strong asset management of Information Technology assets; as an under-investment in Information Technology greatly limits asset management strategies for all other asset classes. 68

71 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Key Findings While there is an extensive number of operating and maintenance activities carried out to ensure that Information Technology Systems perform efficiently and reliably and are secure, levels of service for the overall Information Technology system are poorly defined. This is especially pronounced in the underlying foundational hardware systems which have aged, and in the approach to proprietary software and software upgrades. An Information Technology Strategy project will be undertaken in , and a number of proprietary applications are being replaced which presents an opportunity to establish performance measures and targets to incorporate into future asset management plans. Table 27: Information Technology Levels of Service and Community Satisfaction Measures Asset Performance Measure Measure Type Target Results ( ) Information Technology eservice responsiveness Best Practice No target defined 2016: 98.8% issue resolution rate Data integrity Best Practice No target defined Daily, weekly, monthly and yearly data backups Security monitoring Best Practice No target defined Reportable on a case by case basis Desktop replacements Best Practice Replace every four years 95% Administrative Services: % Satisfied or Very Satisfied Community Survey No target defined 2012: : Other Equipment & Materials Other Materials & Equipment include a wide range of small value materials and equipment for which it is not practical to set a level of service in the asset management plan. Staff manage these resources following the manufacturers recommended maintenance, where it exists, and replacing assets when they are damaged or worn out Environmental Assets Target Condition and Function Well-functioning Environmental Assets provide healthy and resilient forest cover and water conveyance while contributing to a range of environmental and community benefits such as: stormwater control, biodiversity, clean air and water, opportunities to connect with nature, and overall improved quality of life. 69

72 Levels of Service Richmond Hill has a range of levels of service for Environmental Assets (Table 28). There are regulatory requirements related to species at risk that affect how the Town manages Natural Areas and streams. To encourage healthy natural cover an overall target of 25% natural cover in Richmond Hill was set in the Official Plan. A target has also been set to prevent damage to public infrastructure and private property from stream erosion. Other levels of service relate to the protection of biodiversity, specifically species of concern, and community satisfaction with environmental protection and their experience in Natural Areas. There are no levels of service for Street Trees; there is an opportunity to establish these in a subsequent version of the Asset Management Plan. The condition of Natural Areas is considered in the Long Term Woodlot Restoration Program which identifies priorities for restoration of natural cover to be included in the ten year capital forecast. The condition of Valleyland Assets is included in the Valleyland Capital Asset Priority Rating System. Table 28: Environmental Assets Levels of Service and Community Satisfaction Measures Asset Performance Measure Measure Type Target Results ( ) Environmental Assets Species at Risk requirements Regulatory Meet or exceed the Species at Risk conditions in Town owned Natural Areas Reportable on a case by case basis Natural Cover Condition 25% natural cover 2012: 25% Stream Channel Stability Condition Prevent damage to public infrastructure and private property High Priority Areas Identified Biodiversity Condition No target defined 2014: 271 plant species of concern, 111 animal species of concern Environmental Protection: % Satisfied or Very Satisfied Resident Connection to Nature in Town Parks and Natural Areas: % Community Survey Community Survey No target defined 2012: : 80 No target defined 2012: : 84 70

73 Levels of Service R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Richmond Hill s natural environment External Trends and Issues Major risks to maintaining levels of service for Environmental Assets are changing weather conditions associated with climate change, the accidental introduction of invasive species and impacts related to public use and over-use of Natural Areas. Richmond Hill is currently undertaking an Urban Forest Management Plan to help anticipate and mitigate threats to the Town s Environmental Assets Key Findings There are a range of service levels for Environmental Assets based upon regulatory, condition and resident satisfaction performance measures. This is a strong approach for a non-traditional asset area being incorporated into the Asset Management Plan. Opportunities for improvement include defining targets for the existing performance measures and establishing a level of service for Street Trees Conclusions Richmond Hill has levels of service for each asset class which focus on meeting regulatory requirements, asset condition and community satisfaction. Richmond Hill is meeting or exceeding resident expectations for delivery of municipal services, shown by very high community satisfaction results in all categories. Crosby Park There are a number of initiatives underway that will better define levels of service in the near future including the Roads & Traffic Operations Levels of Service Study, the Parks Operations Levels of Service Study, the Fleet Utilization Review and the Information Technology Strategy project. Opportunities for improvement include setting targets for existing levels of service, improved record keeping and reporting and establishing levels of service for street trees. 71

74 4.0 Asset Management Strategies The development of asset management strategies continues Richmond Hill s asset management story, building on the state of local infrastructure and levels of service chapters. Asset management strategies are the planned actions that Richmond Hill uses to manage its infrastructure to meet their defined levels of service, actions like crack sealing and asphalt patching in roads, filter changes and annual maintenance of building heating and cooling systems and regular inspections of stormwater management ponds. When combined together there are thousands of different scheduled inspections, maintenance actions and repair responses that occur every year to ensure that Richmond Hill s infrastructure performs reliably. These actions help to maintain our infrastructure so they do not fail prematurely, but continue to perform well throughout their expected life. The Asset Management Strategy chapter tells us what actions we need to take and when we need to take them. 72 Staff reviewing plans for future infrastructure

75 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N All infrastructure assets go through a series of stages called a lifecycle. Asset management strategies need to consider each stage of the asset lifecycle when determining how to best manage that asset. In particular, sound asset management strategies consider the overall cumulative lifecycle cost when determining what actions to take to manage that asset. For example, it does not make long term sense to purchase an asset cheaply if the extra operation and maintenance requirements of that asset, or its shortened life expectancy, will cost more than purchasing a more durable The asset management strategy is the set of planned actions that will enable the assets to provide the desired levels of service in a sustainable way, while managing risk, at the lowest lifecycle cost. The asset management strategy is the set of actions that, taken together, has the lowest total cost not the set of actions that each has the lowest cost individually. Building Together or reliable asset. It is also not effective to continue to maintain and repair an asset when it would be less costly to replace the asset. Determining the optimum set of management strategies requires the analysis of a number of options and the risks associated with each one. This is particularly relevant when it comes to making a decision to replace an asset. Oak Ridges Community Centre during construction 73

76 t Figure 41: Asset Lifecycle Stages New Infrastructure Asset Disposal Asset Replacement Figure 42: Total Lifecycle Costs Example Excellent Good Fair Nearing End of Life Beyond End of Life Excellent Good Fair Nearing End of Life Beyond End of Life Time Cost Cos Periodic, planned rehabilitation of roadway asphalt has lower total lifecycle costs than rebuilding the road on a less frequent basis. Rehabilitation has higher costs at first, but becomes less expensive over the long term. 74

77 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N 4.1 Planned Actions: Infrastructure Management Strategies The types of planned actions that Richmond Hill uses to manage its infrastructure assets to deliver consistent and reliable service throughout their expected life are dependent on the lifecycle stage of the asset. For example, some planned actions are relevant while considering the acquisition or purchase of an asset while others should be considered when deciding whether to continue to repair or rehabilitate the asset. Planned actions can include inspections and repairs as well as non-infrastructure strategies like growth planning, coordination, data management and procurement. Each stage of the asset s life presents different asset management opportunities to achieve the lowest cost outcomes for the Town s assets. Descriptions of the major lifecycle stages and some opportunities to maintain level of service while lowering total lifecycle cost for each stage are: Asset Acquisition Municipal infrastructure assets are acquired through a number of different mechanisms. Many major infrastructure assets are built during land development or redevelopment by the private sector to standards set by the municipality. Ownership is transferred to the municipality after construction and inspection. The standards and specifications for municipal infrastructure are key non-infrastructure solutions for the municipality to manage expansion of infrastructure (see text box). Other new assets are acquired by the municipality directly through the Procurement By-law, Policies and Procedures, another noninfrastructure solution, to meet Town standards and specifications, including the opportunity to award the procurement to the vendor that demonstrates the lowest lifecycle cost. The majority of Richmond Hill s procurement activities are undertaken competitively to ensure the lowest cost bidder that meets the specifications and standards is awarded the contract. Efforts to strengthen the consideration Non-Infrastructure Solutions Are actions or policies that can lower costs or extend asset life such as better integrated infrastructure planning and land use planning, demand management, insurance, process optimization, managed failures, etc. Richmond Hill incorporates non-infrastructure solutions into its asset management strategies using the following: Strategic Plans and Land-Use Planning (eg. Strategic Plan, Official Plan) Standards and Specifications for new infrastructure Procurement By-law, Policies and Procedures Coordination of multiple asset replacements at the same time Coordination with regional government and other local municipalities and application of total lifecycle cost as a criteria in the procurement process need to remain a priority. Regardless of how an asset is acquired there is an opportunity to include up to date information on new assets into the asset database at the time of acquisition to improve data confidence for future decisions. A major question to be considered during the asset acquisition stage is whether designing to a higher standard or purchasing a different type of asset can result in lower costs later in its lifecycle. 75

78 Operations & Maintenance A key asset management strategy is inspection, assessment and preventative maintenance of existing and potential problems before a failure occurs or before more significant maintenance would be required. In Richmond Hill this includes a range of routine planned actions such as street sweeping, catchbasin cleaning, quarterly and annual equipment servicing, aeration and fertilization of playing fields, flushing of sewers and watermains, and winterization of fire hydrants. Major questions to be considered during the operations and maintenance stage are whether the asset can be operated in a way that reduces day to day costs or whether additional inspection, assessment and maintenance before failures occur could reduce costs and minimize service interruptions. Repair The repair of damaged infrastructure is a key asset management strategy when Operations & Maintenance is not sufficient to maintain assets in acceptable condition or when damage is unanticipated or unexpected. In Richmond Hill this includes a wide spectrum of actions ranging from repairing potholes, broken windows, park benches and photocopiers, to restoring drinking water service after a watermain break. Major questions to be considered during the repair stage are whether repairs can be avoided without affecting the level of service, whether they can be performed at a lower cost through a different service delivery mechanism, or whether they should be used to extend the life of the asset that is nearing the end of its life expectancy. Rehabilitation Some infrastructure assets can be restored to near-new condition and have their expected life extended through planned rehabilitation actions. This may be more cost effective than allowing assets to reach their end of life. A condition assessment study often provides the detailed information needed to determine the scope of the rehabilitation. Examples of rehabilitation of Richmond Hill s assets are sewer re-lining where a smaller diameter pipe is inserted into the existing sewer and the asphalt overlay program where several kilometers of roads are milled and resurfaced each year. Major questions when considering rehabilitation are whether it would be more economical to continue to repair the asset even as the frequency of repairs increase, whether rehabilitation is required to restore level of service, or whether enough interconnected components of the infrastructure are degraded to the point where it makes no sense to rehabilitate part of the infrastructure. Replacement There comes a time in the lifecycle of most infrastructure assets when the most cost-effective strategy is to replace the asset. This may be when it is no longer makes sense to repair or rehabilitate the asset, such as when a road is in poor condition and its underlying water and sewer systems are experiencing frequent failures. It may also be due to the asset no longer meeting the need of a community such as an aging park in a growing area with increased residential density. Some of the key questions at the replacement stage are whether the original design or the service level associated with the asset needs to be re-evaluated, and whether coordinating multiple asset replacements can reduce total costs. 76

79 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Disposal & Decommissioning Some assets result in a substantial liability at their end of life which may include demolition costs and land restoration, and more rarely includes land and water contamination remediation and disposal of hazardous waste. Disposal and decommissioning costs should be included in the total lifecycle costs and asset management practices for municipal assets. A key question at this stage is how the financial, environmental and social costs can be minimized during the disposal of an asset. From time to time Richmond Hill does an assessment of risks associated with decommissioning and disposal of assets. At this time, no assets have been identified that require special disposal or decommissioning consideration. Some classes of Town assets have more fully developed asset management strategies than others. A description of the specific asset management strategies associated with each asset class can be found in sections 4.3 to Options Analysis The goal of asset management strategies is to achieve the lowest total lifecycle cost for the assets while maintaining the level of service for that asset. Given the range of potential options at any stage in the lifecycle of an asset, achieving this goal requires a defined process to evaluate the potential options and determine the best decision to make. Richmond Hill has options analysis processes focused on different stages in the lifecycle including acquisition, operations, maintenance & repairs, rehabilitation and replacement. Each of these are discussed below. Asset Acquisition Richmond Hill has a comprehensive and collaborative process to plan for the future growth of Richmond Hill. Guided by such documents as the Strategic Plan (2009), Official Plan (2010, as amended), Pedestrian and Cycling Master Plan (2010), Transportation Master Plan (2011 update), Cultural Plan (2011), Parks Plan (2013), Recreation Plan (2014), Environment Strategy (2014), and Urban Master Environmental Servicing Plan (2014), each of these documents was developed through the lens of options analysis and risk mitigation to best serve the residents of Richmond Hill currently and into the future. The expansion of services to new areas or expansion of existing services to meet future demands is coordinated through the 10 year capital forecast, balancing funding allocation amongst the growth needs of all of the strategic plans, and between funding these growth projects and funding rehabilitation and replacement of existing assets. There is an opportunity to review and improve the asset acquisition standards and policies to reduce total lifecycle costs. Operations, Maintenance & Repairs Options for optimizing operating maintenance occur every budget cycle and have been the focus of internal reviews, such as the Operations Core Services Review. There are opportunities to develop more options analysis at the operations, maintenance and repairs stages of the lifecycle. Options analysis during the operations phase of asset lifecycles will be a future focus in the ongoing development of the Maximo Work and Asset Management program. 77

80 Rehabilitation Infrastructure assets which are candidates for rehabilitation require a business case to be prepared and are usually supported by detailed condition assessment reports. There are a number of triggers for rehabilitation depending upon the asset class. For example, Roads have a Pavement Quality Index that triggers rehabilitation activities, Buildings and Parks use ReCAPP, a lifecycle planning software tool which combines asset condition information with age information to create a list of assets that are candidates for rehabilitation. There are additional systems to identify candidate assets for rehabilitation for bridges and culverts, watermains, wastewater sewers and stormwater management facilities. Incorporated into the business case template is the requirement to evaluate alternatives to improve service and decrease cost. As the asset management plan and processes mature there is an opportunity to focus more on rehabilitation activities, which often result in lower total asset lifecycle costs, instead of the current focus on asset replacement prioritization. Replacement In Richmond Hill, most of the major asset classes have a Council approved prioritization rating system to determine the highest priorities for replacement, including the Roadway System and underlying sewers and pipes (Road Reconstruction Priority Rating System), Sidewalks (Sidewalk Priority Rating System), Stormwater Management Facilities (Stormwater Management Facility Prioritization), Parks (Park Redevelopment Process) and Valleyland Capital Assets (Valleyland Capital Asset Priority Rating System). These prioritization systems include criteria to evaluate the level of risk the asset presents, based on condition, function, opportunities, benefits and costs so informed decisions can be made. They also consider the opportunities for coordinated or integrated action on different asset classes, such as the roadway system with its underground water, wastewater and stormwater assets, to avoid impacts and unnecessary costs. The Parks & Outdoor Recreation asset class also uses ReCAPP, a lifecycle planning software to create a list of parks that have a lot of individual component assets nearing end of life that are candidates for park replacement. Richmond Hill s Asset Replacement Priority Rating Systems For each asset class, different considerations are weighted differently when prioritizing major asset rehabilitation and replacement work, balancing technical analysis, risk and community expectations. Example: Road Reconstruction Priority Rating System: Road physical aspects including pavement structure, maintenance demand, pavement surface, road width and drainage have 49% of the prioritization weight. Water and sewer aspects have 25% of the weight, considering the condition and criticality of the adjacent watermains and sanitary sewers. Road usage accounts for 26% of the prioritization weight and considers the Road Class, sidewalk condition and whether there is a Bus Route, School, Community Centre or Park serviced by the section of road being considered 78

81 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N In addition to the project prioritization rating systems, each capital project proposal must include a business case that assesses the risks and advantages of the proposed project implementation options. Each capital business case must address: Historical statistics supporting the need for the capital project Identify any risk to the community or the corporation How the completion of this project will service the current and future needs of the community How the risks with the current strategy will be reduced though the completion of this project Qualitative (non-financial) impacts of completing the capital project How it is in support of the overall objectives of the Town or Department How other municipalities or related organizations are performing this function The comparative advantages and disadvantages of each alternative implementation, demonstrating that staff have exercised due diligence in arriving at the recommended project Overall capital costs, and provide an estimate on the operational costs of the capital asset s first year of operations and the first full year of operations. Where possible, include a forecast provision for capital impacts as a result of ongoing studies, master plans, recommendations, and development charge updates, etc Other possible funding opportunities besides Reserves, Development Charge or tax rate including: third party funding recovery, partnership opportunities and Federal Gas Tax Reserve A description of the specific options analysis processes associated with each asset class can be found in sections 4.3 to Roadway System Asset Management Strategies The Roadway System is a heavily used and highly visible community infrastructure asset in Richmond Hill and the lifecycles of the various components are well understood. The road bed and road surface have the most extensive asset management strategies, having a range of planned actions for each of the stages of the road s lifecycle (Table 29). These actions are largely driven by the Ontario Minimum Maintenance Standards although Richmond Hill goes beyond these standards. Roadway with bike lane 79

82 Table 29: Roadway System Asset Management Strategies Road bed Road Surfaces Sidewalks & Walkways Monitoring Monthly inspection (Road Patrol) Monthly inspection (Road Patrol) Monthly inspection (Road Patrol) Condition Assessment PMS update every 3 years. PQI used to rate road surface Condition Annual Sidewalk Rating System Operations & Maintenance Sweeping Debris removal Crack sealing Asphalt cold patching Winter maintenance Line and marking repainting Sweeping Debris removal Crack sealing Asphalt cold patching Winter maintenance Line and marking repainting Sweeping Crack sealing Repairs Shouldering Curb repair Sound fence repair Regrade and re-sod Boulevard restoration Sign and post repair Graffiti removal Guide rail repair or replace Fence repair or replace Asphalt hot patch Asphalt cold patch Dust control Granular material application Shouldering Curb repair Sound fence repair Regrade and re-sod Boulevard restoration Sign and post repair Graffiti removal Guide rail repair or replace Fence repair or replace Asphalt hot patch Asphalt cold patch Dust control Granular material application Concrete grinding Asphalt cold patch Asphalt hot patch Mud jacking Interlocking base repair/ reinstall Rehabilitation Capital business case Shave and pave Full overlay Infrared seal Micro-seal Sidewalk bay replacement Asphalt full overlay End of Life Road Reconstruction Priority Rating System identifies priority projects to include in the Ten Year Capital Forecast Road Reconstruction Priority Rating System identifies priority projects to include in the Ten Year Capital Forecast Sidewalk Priority Rating System or Road Reconstruction Priority Rating System identifies priority projects to include in the Ten Year Capital Forecast *PMS Pavement Management System *PQI Pavement Quality Index Moving onto the other roads components, Sidewalks and Walkways, like roads, have a full range of asset management strategies. Bridges and Culverts are more complex; they have a good range of planned actions to assess their condition and safety and to undertake repairs. However, when they start to move from fair to nearing end of life condition, a condition assessment is needed, followed by a business case to undertake the specialized rehabilitation needed. 80

83 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Table 29: Roadway System Asset Management Strategies Street Lighting Bridges & Culverts Traffic Signals Monitoring Monthly inspection (Road Patrol) Online public reporting Monthly inspection (Road Patrol) Visual inspections twice per year Visual inspections after storm events Monthly inspection Annual detailed inspection Condition Assessment OSIM standard, every 2 years Operations & Maintenance Annual test Annual maintenance Debris removal Deck drain and bearing seat flushing (power wash) Expansion joint cleaning Annual test Annual maintenance Repairs Luminaire replacement Pole repair Pole replacement Electrical supply repair Concrete repair Handrail repair Component repair Component replacement Rehabilitation Capital business case Capital business case Capital business case End of Life Assessed when roads projects are added to the Ten Year Capital Forecast Capital business case Assessed when roads projects are added to the Ten Year Capital Forecast *OSIM Ontario Structure Inspection Manual Traffic Signals and Streetlights have regular inspection and maintenance programs, but fewer options to correct or rehabilitate malfunctioning components.usually malfunctioning components are replaced which restores their function and end of life replacement occurs when a road is being reconstructed or when a decision is made to replace the whole system such as with the current LED light conversion project. The management of Richmond Hill s pavement quality provides a good example of how different asset management strategies can help to achieve the lowest lifecycle cost of an asset. At the early stages of a roadway lifecycle, regular inspection and routine maintenance such as sweeping and debris removal are sufficient to keep Richmond Hill s roads at their target condition. The early stages, when the roads are in good or very good condition, are also the time to begin to take preventative action on small deficiencies that may become bigger later on, such as crack sealing and asphalt patching. At the mid stages of the lifecycle, when roads and in their fair to good range, more repairs are necessary to keep the road at its target condition. There may be a need to undertake more significant repairs around catchbasin and manhole covers, and there will likely be a need for more localized patching and even the resurfacing of some larger sections to fix surface roughness and protect the underlying road bed. 81

84 As the road surface moves from fair to nearing end of life, the frequency and size of these types of repairs will increase to the point where it is time to evaluate whether it would be more costeffective to undertake rehabilitation of the surface of the road. At this point in the lifecycle, many of the longer lived road components will still be in good condition making the costly reconstruction of the entire roadway unnecessary. A condition Assessment such as the Pavement Management Analysis that Richmond Hill undertakes on its roads every three years is a good way to identify candidates for rehabilitation. Richmond Hill has a range of strategies available for rehabilitating different classes of roads. For example, microseal asphalt rehabilitation is a strategy that is suited for roads in an industrial area, whereas shave and pave or full overlay are more suited to residential areas. After rehabilitation of the road surface the condition of the road will move into the very good condition again, with minimal maintenance requirements. A road surface may be rehabilitated several times before it is necessary to reconstruct the entire road but at some point in time the other roadway components and the underlying infrastructure such as sewer and water pipes will also need attention. This is the time that the replacement of the entire road needs to be considered. Richmond Hill uses a Road Reconstruction Priority Rating System to evaluate roads that are a priority to be reconstructed in the next ten years and add them to the ten year capital forecast. When Council confirms that a road is to be reconstructed, the unusable portions of the old road are decommissioned and disposed and a new road designed and built, which is the end of the lifecycle of the original road and the beginning of the new road. At the asset replacement stage, it is important to re-evaluate whether the road in its original configuration is sufficient to meet current standards and future conditions. The redesign of the road and its underlying services will take direction from key documents such as the Official Plan, Transportation Master Plan, Pedestrian & Cycling Master Plan and any other local planning and engineering studies Options Analysis and Project Prioritization Richmond Hill s Roadway System has a wide range of asset management strategies. However, in order to be effective, the right strategies need to be applied at the right times. Monitoring, Operations & Maintenance and Repair decisions are currently tracked through the Maximo Work and Asset Management System. There is an opportunity to improve decision making by comparing the cost-effectiveness of various strategies applied at different frequencies to find the best combination. For example, would it be better to conduct more frequent crack sealing to reduce the need for pothole patching and surface rehabilitation later on. Changing how assets are maintained may result in requests through the budget for more resources to undertake preventative maintenance in order to extend the lifecycle and eventual replacement of the asset, reducing the capital repair and replacement costs. 82

85 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N The need for rehabilitation is identified by condition assessment results and triggers creation of a business case which includes the evaluation of alternatives. There is an opportunity to strengthen the evaluation of alternatives to include the implications of the proposed rehabilitation actions on the entire lifecycle. End of Life replacement for rural roads were prioritized using the Road Reconstruction Priority Rating System. This rating system will form the basis for future Roadway System asset replacement prioritization decisions (see text box). The approach to the Road Reconstruction Priority Rating System is strong as it includes criteria for condition, function and risk and integrates with other asset classes which are linked to and affected by changes to the Roadway System. A second rating system for sidewalks, the Sidewalk Priority Rating System focuses on prioritizing upgrades of sidewalks and paths to increase mobility options and to further the Pedestrian and Cycling Master Plan. The most significant opportunity to improve Options Analysis for the Roadway System is to link the decisions made at the initial construction of an asset with those made during operations, maintenance, repair, rehabilitation and end of life to see how each decision affects the longevity and lifecycle cost of the asset. Road Reconstruction Priority Rating System Roadworks: Pavement Structure, Pavement Surface, Road Width, Maintenance Demand, Drainage (49%) Water and Sewer: Watermains, Sanitary Sewers (25%) Road Usage: Bus Route, Road Class, School/Community Centres/Parks, Sidewalks (26%) Sidewalk Priority Rating System Road Function (52%) Traffic Characteristics (26%) Pedestrian and Cycling Master Plan Criterion (22%) Key Findings There is a wide range of asset management strategies in place for most components of Richmond Hill s Roadway System. The management of the roadway surface is a good example of the use of planned actions at different stages of an asset s lifecycle to cost effectively manage the asset. Decisions to apply asset management strategies are made through the Work and Asset Management System to operate, maintain and repair the asset, through condition assessment and business cases at the rehabilitation stage and through an integrated priority rating system at end of life. There is an opportunity to strengthen the options analysis at each stage as well as link the decisions across the stages to see how they affect the overall longevity and lifecycle cost of the asset. Yonge Street in Downtown Richmond Hill 83

86 4.4 Buildings Asset Management Strategies Although Richmond Hill has a range of buildings that accommodate different uses, the strategies to maintain the buildings at their target condition are similar. There is only one set of asset management strategies for Richmond Hill s buildings instead of strategies for each type of building, which is an industry-wide approach. For example, maintenance of heating, ventilation and air conditioning are similar, regardless of the type of building, as are the maintenance strategies for the electrical systems, foundation and interior walls. One drawback to this approach relates to Heritage Buildings. While most components of Heritage Buildings can be managed like a conventional building, others, like the designated heritage features, need specific attention. Overall in Richmond Hill there are asset management strategies for each stage of a building s lifecycle (Table 30) which is a strong approach. Recently the monitoring, operation, maintenance and repair stages of the lifecycle have been strengthened through the establishment of a Service Level Agreement between the Environment & Infrastructure Services Department which is responsible for the lifecycle management of the building and the Community Services Department that operates the building. The agreement outlines responsibilities for daily weekly, monthly, quarterly and annual inspection, operating and maintenance requirements and service level standards for repairs. Within the buildings asset management strategies is a strong emphasis on preventative maintenance, following the manufacturers recommended maintenance programs. Major component replacements, such as the replacement of lighting and heating systems, follow well established processes, as do the rehabilitation of facilities. Many of Richmond Hill s buildings have already undergone major renovations to keep these facilities within their target condition, to meet accessibility and energy conservation requirements, and to adapt to the changing needs of the community. Only rarely is it necessary to decide that a building is at its end of life, and then decommission the building and possibly build a new one. Finally, energy audits and energy conservation goals may result in early replacement of building components where the savings justify the costs. Buildings Table 30: Buildings Asset Management Strategies Monitoring Condition Assessment Operations & Maintenance Repairs Major Rehabilitation End of Life Building automation system monitoring Daily, weekly, monthly, quarterly annual inspections as per the Service Level Agreement Asset validation survey every 5 years Town-owned Built Heritage Inventory (2012) Daily, weekly, monthly, quarterly, annual operations as per the Service Level Agreement Preventative maintenance work orders Demand maintenance work orders Building capital replacement program Building renovations subject to capital business case Capital business case 84

87 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Options Analysis and Project Prioritization Richmond Hill s Buildings have a wide range of asset management strategies to apply at each stage of a buildings lifecycle. However, similar to the Roadway System, in order to be effective the right strategies need to be applied at the right times. Monitoring, Operations & Maintenance and Repair decisions in buildings are currently tracked through the Maximo Work and Asset Management System. The manufacturers recommended maintenance schedules are followed and repairs are responded to as they arise. The need for rehabilitation is identified by tracking the age and condition of assets in the ReCAPP database, an asset lifecycle planning tool, validated by field inspections. Major renovations to restore a facility to its target condition are made through a business case which includes the evaluation of alternatives. One opportunity to strengthen the Buildings options analysis processes would be to look more closely at components which are requiring frequent repair or maintenance before nearing their end of life. The ReCAPP system was not designed to identify and address assets that are failing early. A second opportunity is to look at the standards for initial construction of a building with the expected costs of operations, maintenance and repair to optimize the overall lifecycle cost of the asset. A third opportunity for future versions of the Asset Management Plan is to identify the unique asset management strategies that are applicable to Heritage Buildings with their lifecycle management and cost implications Key Findings There are asset management strategies for each stage of a building s lifecycle in Richmond Hill, including following manufacturers recommended maintenance schedules, which is a strong approach. Decisions to apply asset management strategies to operate, maintain and repair buildings are established in the Service Level Agreement and tracked through the Maximo Work and Asset Management System. Rehabilitation, including the replacement of building system components or major renovations to facilities are guided by a lifecycle planning tool and business cases to Council which include the evaluation of alternatives. There is an opportunity to establish specific asset management strategies for Richmond Hill s Heritage Buildings, to look at a process to identify components that are not near their end of life but are requiring frequent repairs and to look at standards for the initial construction of a building in the context of minimizing overall lifecycle costs. Rehabilitation of Eyer Wideman House 85

88 4.5 Stormwater Management Asset Management Strategies Richmond Hill s Stormwater Management assets play an important but not commonly known function in protecting the environment and protecting our community. Stormwater Management assets are highly integrated in the community and need to be coordinated with other asset classes. Stormwater catchbasins and manholes are in the surface of the road and are maintained as part of the Roadway Surface, stormwater pipes are located within the road structure, and stormwater outfalls and stormwater management facilities may be in or adjacent to parks and open space. The long expected life of stormwater assets means that much of the asset lifecycle and the resulting asset management strategies are focused on operations, maintenance and repairs to maintain their function. There are a range of asset management strategies for stormwater assets (Table 31) but they are mainly for reactive inspection, maintenance and repair actions rather than planned actions. There is an opportunity to evaluate whether there would be value in investing more in planned preventative maintenance, and a study is underway to look at planned actions to maintain stormwater management facilities and the above ground components of the storm drainage system, which should help to answer this question. Camera inspection of the underground storm sewer pipes every five years helps determine whether there are deficiencies building up that could be addressed by better preventative maintenance. Strategies for the rehabilitation of Stormwater Management Facilities are being developed through condition assessments and the Sediment Removal Capital Program. Rehabilitation of other components of the Stormwater Network are infrequent and are initiated by a capital Business case, after being detected because of failure of the asset or by detecting deficiencies through routine maintenance or the camera inspection program. End of Life replacement for both the Stormwater Network and the Stormwater Management facilities have well established rating systems. The Stormwater Network components are included in the Road Reconstruction Priority Rating System and the Stormwater Management Facilities follow the Stormwater Management Facility Prioritization system. Table 31: Stormwater Management Asset Management Strategies Stormwater Network Stormwater Management Facilities Monitoring Condition Assessment Monthly inspection of catchbasins/manholes (Road Patrol) Inspection of inlets/outlets twice annually Inspection of inlets/outlets around major rainfall events Storm manhole visual inspection Storm box culvert visual inspection Oil-grit separator visual inspection Storm Catchbasin Leads TV Inspection Storm Lateral Line TV Inspection Storm Main Line CCTV Monthly hydrological data Inspection of inlets, outlet, water elevation twice annually Detailed annual inspection Sediment survey every 5 years 86

89 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Table 31: Stormwater Management Asset Management Strategies Stormwater Network Stormwater Management Facilities Operations & Maintenance Repairs Debris removal Sediment removal Storm main line flushing Catchbasin cleaning Oil-grit separator maintenance Oil-grit separator cleaning Storm box culvert maintenance Manhole maintenance Concrete headwall repair Grate repair Ditch excavation & regrade Culvert replacement Catchbasin frame/cover replacement Catchbasin moduloc repair Manhole frame/cover replacement Manhole moduloc repair Storm catch basin leads repair Storm lateral line blocked Storm lateral line repair Storm lateral line replace Storm main line blocked Storm main line repair Storm main line replace Debris removal Flushing Outlet maintenance Sediment removal Concrete repair Fence repair/replace Grate repair/replace Gate/weir repair/replace Fill and reinforce Rehabilitation Capital business case Sediment removal capital program End of Life Road Reconstruction Priority Rating System considers Stormwater Network when identifying priority projects to include in the Ten Year Capital Forecast Stormwater Management Facility Prioritization system identifies priority projects to include in the Ten Year Capital Forecast Options Analysis and Project Prioritization As the focus for the management of Richmond Hill s Stormwater Management assets is on inspections and the correction of deficiencies, minimal options analysis is being undertaken until the assets near their end of life. There is an opportunity to evaluate the current deficiencies in assets of different ages and ask whether establishing a preventative maintenance program would be cost-effective for these long lived assets. Monitoring, Operations & Maintenance and Repair actions are currently tracked through the Maximo Work and Asset Management System, but with insufficient detail for some subcomponents to determine what deficiency they are correcting. Even if there is insufficient value identified in the business case for investing in more preventative maintenance, better descriptions of the types of actions being taken should be pursued in the Work and Asset Management System. 87

90 The need for rehabilitation for Stormwater Network assets is identified through condition assessment of the assets, which may be due to the failure of the asset or detection of a deficiency through the camera inspection program. These are outlined in a business case which includes the evaluation of alternatives. The need for rehabilitation of Stormwater Management Facilities is identified through sediment surveys, and candidate projects are proposed to be added to the Sediment Removal Capital Program. End of Life replacement for the Stormwater Network assets are prioritized using the Road Reconstruction Priority Rating System (see text box). A second rating system for Stormwater Management Facilities, the Stormwater Management Facility Prioritization focuses on prioritizing upgrades of Stormwater Management Facilities to current stormwater standards. The approach to the Road Reconstruction Priority Rating System is strong as it includes criteria for condition, function and risk and integrates with other asset classes which are linked to and affected by changes to the Storm Network. The approach to Stormwater Management Facility Prioritization is also strong meaning there is a strong rationale for the projects that are recommended to be included in the ten year capital forecast. A third priority rating system, the Valleyland Capital Assets program that addresses the repair and remediation of watercourses that the stormwater flows through will be addressed in the Environmental Assets section Key Findings Road Reconstruction Priority Rating System Roadworks: Pavement Structure, Pavement Surface, Road Width, Maintenance Demand, Drainage (49%) Water and Sewer: Watermains, Sanitary Sewers (25%) Road Usage: Bus Route, Road Class, School/Community Centres/Parks, Sidewalks (26%) Stormwater Management Facility Prioritization Flood Protection (25%) Statutory and Regulatory Requirements (20%) Risk Management / Health and Safety Issues (15%) Operations and Maintenance Considerations (15%) Cost Benefit Analysis (5%) Erosion control and slope stabilization (5%) Spills management (5%) Environmental issues (5%) Community concerns (5%) Richmond Hill s Stormwater Management assets are highly integrated with other asset classes. The focus for these long lived assets is primarily on inspections and then responding to deficiencies. It is unclear whether more preventative maintenance would be cost-effective although this question is being investigated. There is an opportunity to track maintenance and repair actions in more detail, especially for the underground components of the Stormwater Network. The approach to Rehabilitation and End of Life replacement is strong contributing to sound lifecycle management decisions for this asset class. 88

91 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N 4.6 Water Network Asset Management Strategies Asset Management Strategies for Richmond Hill s Water Network are largely driven by Ontario s stringent water regulations which recognize that providing safe, reliable drinking water requires effective preventative maintenance and repair strategies. Of particular relevance to Water Network asset management is the Ontario Safe Drinking Water Act, 2002, which require extensive reporting on water quality and an audited management system. Water Network assets are highly integrated with Stormwater Management and Wastewater Network assets which are largely located within the Roadway System right of way and need to be coordinated with these asset classes. The long expected life of Water Network assets means that much of the asset lifecycle and the resulting asset management strategies are focused on operations, maintenance and repairs to maintain their function. Stormwater management water quality testing There are a range of asset management strategies for Water Network assets (Table 32). This asset class has some of the most extensive monitoring activities, due to the regulatory requirements to frequently test the water quality for bacteria, residual chlorine (that prevents bacteria and other pathogens), lead and trihalomethanes. In addition to the regulated actions, Richmond Hill has other planned preventative maintenance actions. One example is the valve exercising program which uses a specialized apparatus to gradually open and close the valves that isolate different sections of the Water Network. In the past, a watermain break would require shutting off valves to repair the break but these unmaintained valves would occasionally malfunction increasing the scope of the impact, efforts and cost. The valve exercising program has reduced these unplanned impacts. A second example is the watermain flushing program where fast-moving water scours and cleans out mineral deposits and sediment that have built up over time and settled at the bottom of the pipes. Strategies for the rehabilitation of Watermains are being developed through condition assessments, and are triggered through the tracking of watermain breaks, and the Watermain Replacement Program. Rehabilitation of other components of the Water Network are infrequent and are initiated by a capital business case when major deficiencies are identified through inspections or failure reports. End of Life replacement for the Water Network is included in the Road Reconstruction Priority Rating System. Replacement of Water Meters is the only strategy defined for these components of the Water Network. 89

92 Table 32: Water Network Asset Management Strategies Water Distribution Water Meters Monitoring Condition Assessment Operations & Maintenance Repairs Rehabilitation End of Life Hydrant Annual Inspection Hydrant Winter Inspection Hydrant Meter Flow Test Water Quality Bacti Samples, Water Quality Daily Residual, Water Quality Lead Samples, Water Quality Trihalomethanes Tracking of Watermain breaks Water Quality Flushing Dead Ends Water Quality Flushing and Auto Flushing Stations Sample Station General Maintenance Hydrant Preventative Maintenance Hydrant Painting Valve Exercising Property Line Valve Exercising Main Line Valve Exercising Hydrant Secondary Water Service Frozen Service Water Service Repair Water Service Replace Sample Station Repair Sample Station Replace Hydrant Repair Hydrant Replace Valve Repair Property Line Valve Replace Property Line Valve Repair & Restraining Watermain Repair Watermain replacement program Watermain relining Road Reconstruction Priority Rating System considers Water Network when identifying priority projects to include in the Ten Year Capital Forecast Water meter replacement program Options Analysis and Project Prioritization Richmond Hill s Water Network has a wide range of asset management strategies. Monitoring, Operations & Maintenance and Repair decisions are currently tracked through the Maximo Work and Asset Management System. Planned preventative maintenance actions, such as valve exercising are being implemented based upon best practices in other municipalities and the observed benefits of reducing the impact and cost of other water system repairs. 90

93 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N The need for rehabilitation of watermains is part of the Watermain Replacement Program which includes a set of condition assessment criteria and the development of a business case which includes option analysis. Options analysis for End of Life replacement is integrated with many other assets in the Road Reconstruction Priority Rating System (see text box). This is a strong approach as it includes criteria for condition, function and risk and integrates with other asset classes which are linked to and affected by changes to the Water Network Key Findings Richmond Hill s highly regulated Water Network is integrated with other asset classes Road Reconstruction Priority Rating System Roadworks: Pavement Structure, Pavement Surface, Road Width, Maintenance Demand, Drainage (49%) Water and Sewer: Watermains, Sanitary Sewers (25%) Road Usage: Bus Route, Road Class, School/Community Centres/Parks, Sidewalks (26%) and has a well-developed set of asset management strategies. Richmond Hill is going beyond regulatory requirements to develop planned preventative maintenance actions based upon best practices in other municipalities and observed benefits. The approach to Rehabilitation and End of Life replacement is strong contributing to sound lifecycle management decisions for this asset class. 4.7 Wastewater Network Asset Management Strategies Richmond Hill s Wastewater Network assets are largely located below ground and are highly integrated with Water Network and Stormwater Management assets within the Roadway System right of way. As a result, the management of these assets needs to be coordinated with these asset classes. Similar to stormwater, the long expected life of Wastewater Network assets means that much of the asset lifecycle and the resulting asset management strategies are focused on operations, maintenance and repairs to maintain their function. There are a range of asset management strategies for wastewater assets (Table 33). A comprehensive program is in place for the monitoring and maintenance of pumping stations due to the risk of spills should a pumping station fail. Richmond Hill is planning on installing SCADA (Supervisory Control And Data Acquisition) systems at the pumping stations to expand this program and allow for remote monitoring. The underground sanitary sewer pipes are camera inspected every five years. Incorporating the inspection results into a condition database will help to improve data confidence on the sewer system as well as helping to identify trends where deficiencies are building up that could be addressed by better preventative maintenance. 91

94 Table 33: Wastewater Network Asset Management Strategies Sanitary Collection Pumping Stations Monitoring Sani Manhole Visual Inspection Sani Pump Stations Inspection Condition Assessment Operations & Maintenance Repairs Rehabilitation End of Life Sani Main Line CCTV Sani Lateral Line TV Inspection Sani Manhole Maintenance Sani Main Line Flushing Sani Lateral Line Blocked Sani Lateral Line Repair Sani Lateral Line Replace Sani Manhole Repair Sani Manhole Replace Sani Main Line Blocked Sani Main Line Repair Sani Main Line Reaming Sani Main Line Replace Capital business case Sanitary sewer relining Road Reconstruction Priority Rating System considers Wastewater Network when identifying priority projects to include in the Ten Year Capital Forecast Building envelopes tracked in Buildings Sani Pump Stations Maintenance Sani Pump Stations Repair Capital business case Capital business case Strategies for the rehabilitation of the sanitary sewers, such as sewer relining, are being developed in cooperation with York Region through the Inflow and Infiltration reduction strategy and are initiated by a capital business case. End of Life replacement for the Water Network is included in the Road Reconstruction Priority Rating System Options Analysis and Project Prioritization Richmond Hill s Wastewater Network has a full range of asset management strategies. Monitoring, Operations & Maintenance and Repair decisions are currently tracked through the Maximo Work and Asset Management System. Greater attention is being paid to the options analysis in the higher risk pumping stations in these life cycle stages than the rest of the wastewater collection system. The recent decision to install SCADA remote monitoring at the pumping stations to minimize the risk of sewage and the efficiencies associated with remote monitoring is one example of this. The need for rehabilitation is initiated by condition assessment and a capital business case when major deficiencies are identified through inspections, failure reports, or through the Inflow and Infiltration reduction strategy in cooperation with York Region. 92

95 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Options analysis for End of Life replacement is integrated with other assets in the Road Reconstruction Priority Rating System (see text box in previous section). This is a strong approach as it includes criteria for condition, function and risk and integrates with other asset classes which are linked to and affected by changes to the Wastewater Network Key Findings Richmond Hill s Wastewater Network assets are long-lived assets that have a full range of asset management strategies in place. There is a strong monitoring and preventative maintenance program for the higher risk pumping stations and the decision has been made recently to move to SCADA systems which allow for remote monitoring. The options for rehabilitation are being expanded through the Inflow and Infiltration reduction strategy in cooperation with York Region. The approach to End of Life replacement is integrated with other asset classes which is a strong approach. 4.8 Parks & Outdoor Recreation Asset Management Strategies Richmond Hill has an extensive system of Parks and Outdoor Recreation assets that are widely used by the community. Parks & Outdoor Recreation assets are highly visible to the community and currently much of the Town s management efforts go into maintaining the appearance and usability of these facilities through general operational activities like mowing grass and sanitation. While Richmond Hill meets the regulatory requirements for monthly inspection of playgrounds and is moving towards a more preventative maintenance approach to turf quality and playing condition of sports facilities, the remainder of the strategies involve repairing assets on an as needed basis (Table 34). The need for better monitoring and preventative maintenance strategies has been identified and a study is underway to establish a range of strategies to better manage Parks & Outdoor Recreation assets with an emphasis on monitoring and preventative maintenance. Rehabilitation strategies usually involve replacing individual components of a park that can no longer be kept in target condition through repairs, such as a playground equipment replacement. Rehabilitation activities are typically initiated through a business case. End of Life replacement is triggered through one of two mechanisms. First, when a park has a number of assets reaching end of life through the ReCAPP Lifecycle Analysis tool an evaluation is made to determine whether Dorothy Price Park these assets should be replaced individually or whether the whole park is a candidate for replacement. Second, the Parks Redevelopment Process evaluates identifies aging parks in growth areas which may no longer be meeting the needs of the surrounding community as potential candidates for replacement. 93

96 Table 34: Parks & Outdoor Recreation Asset Management Strategies Paths & Trails Playgrounds & Waterplays Servicing & Furnishings Sports Facilities Monitoring Foreperson weekly inspection Foreperson weekly inspection Monthly playground inspections Foreperson weekly inspection Foreperson weekly inspection Condition Assessment May be undertaken to support capital business case May be undertaken to support capital business case May be undertaken to support capital business case May be undertaken to support capital business case Operations & Maintenance Snow removal Mowing General Turf Maintenance Sanitation Diamond Dragging Lining Fields Mowing Fertilizing Hand Fertilizing Tractor Aerifying Top Dressing Overseeding Repairs Repairs Path/Walkway Repairs Bridges Repairs Parking Lots/ Roads Repairs Play Equipment Repairs Water Play Repairs Fences/Gates Repairs Parks Furniture/ Signs/ Shelters/Bleachers Repairs Utilities/ Servicing Repairs Irrigation Repairs Sports Field Lighting Repairs Pathway Lighting Sports Facility Repair Rehabilitation Capital business case Capital business case Capital business case Capital business case End of Life Park Redevelopment Process or ReCAPP Lifecycle Analysis identifies priority projects to include in the Ten Year Capital Forecast Park Redevelopment Process or ReCAPP Lifecycle Analysis identifies priority projects to include in the Ten Year Capital Forecast Park Redevelopment Process or ReCAPP Lifecycle Analysis identifies priority projects to include in the Ten Year Capital Forecast Park Redevelopment Process or ReCAPP Lifecycle Analysis identifies priority projects to include in the Ten Year Capital Forecast 94 Saigeon Trail

97 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Options Analysis and Project Prioritization As the focus for the management of Richmond Hill s Parks & Outdoor Recreation assets for much of their lifecycle is on general operational activities and repairs when needed, there is little options analysis currently being undertaken until the assets near their end of life. One exception is for sports fields where recent efforts to improve turf quality have first involved soil testing to determine the right strategies (e.g. irrigation, aeration, fertilization etc.) to take. A study is underway to determine additional strategies to better manage parks assets focusing on monitoring and preventative maintenance. Monitoring, Operations & Maintenance and Repair actions are currently tracked through the Maximo Work and Asset Management System, but with insufficient detail to evaluate the effectiveness of the different strategies. The need for rehabilitation is identified by a business case supported by condition assessment results. End of Life replacement for the Parks & Outdoor Recreation assets are either prioritized using ReCAPP, a lifecycle planning tool or the Parks Redevelopment Process (see text box). The ReCAPP lifecycle planning tool tracks the condition of different assets in a park and when a number of assets are nearing end of life, an evaluation is made to determine whether it would be advantageous to plan for the replacement of the entire park. The Parks Redevelopment Process looks at the Town s aging parks and determines whether there is an opportunity to redevelop parks to better meet the need of the changing community based upon a number of criteria. These projects are then recommended to be included in the Town s ten year capital forecast. Generally the Parks & Outdoor Recreation assets are maintained independently of other asset classes so there is little overlap in the priority rating systems. Park Redevelopment Process Stage 1: Establish Candidate Parks: Must be 30 years old or more Stage 2: Determine Park Redevelopment Projects: Must meet one of the 4 criteria. Criteria #1: Has the park been expanded or reconfigured as a result of land acquisition? Criteria #2: Changes in land use, population density or demographics around the park? Criteria #3: Financially prudent given the age and operations costs? Criteria #4: Will redevelopment of the park assist in meeting the target service level? Stage 3: Prioritize Park Redevelopment Projects: How many prioritization criteria were met in Stage 2? Does the timing coincide with scheduled repair and replacements of existing facilities? Is there public support/demand for the redevelopment project? Will the redevelopment facilitate stronger connections within the neighbourhood? 95

98 4.8.3 Key Findings Asset management strategies for Richmond Hill s Parks & Open Space System are currently focused on general operations and repairs. A study is underway to expand the number of strategies and place more emphasis on better monitoring and preventative maintenance. This will facilitate a stronger approach to options evaluation during the monitoring, operations & maintenance and repair stage of the asset lifecycle. Rehabilitation activities are undertaken following the preparation of a business case. There is a strong End of Life process which covers the need to replace Parks & Outdoor Assets either due to condition or changing needs in the community. 4.9 Vehicles & Equipment Asset Management Strategies Asset management strategies for Richmond Hill s Vehicles & Equipment are largely driven by Ontario regulations for the safe operation of motor vehicles and following manufacturers recommended maintenance schedules (Table 35). The majority of these strategies are in the monitoring and preventative maintenance stages of the lifecycle to try to minimize unplanned service interruptions and costs. At the End of Life, vehicles are sent to auction to recoup residual value and a business case is prepared for a replacement vehicle taking into consideration changes in technology, fuel efficiency and intended use. Monitoring Operations & Maintenance Repairs End of Life Table 35: Vehicles & Equipment Asset Management Strategies Vehicles & Equipment Daily Circle Checks Annual Inspection Annual Safety Validation Emissions testing Annual Service Seasonal Service A Service Manufacturer Recommended Scheduled Maintenance Retorque Wheels Demand Work Orders Disposal of Vehicles & Equipment (Auction) Capital business case for replacement Options Analysis and Project Prioritization Options analysis for Vehicles and Equipment assets features most significantly as decisions are made to take the vehicle out of service at its end of life and when decisions are made to purchase a new vehicle. When vehicles near their End of Life the condition and annual operating cost for the vehicle are evaluated to determine whether vehicles can be kept in service for an additional season. This is helping to offset the need for seasonally leased vehicles. Additionally, a Fleet Utilization Study is underway (2016) to provide fleet utilization standards for the cost-effective use of a vehicle over its lifecycle, identify under-utilized vehicles and make recommendations to rightsize the fleet. Monitoring, Operations & Maintenance and Repair actions are currently tracked through the Maximo Work and Asset Management System. 96

99 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Key Findings Asset management strategies for Richmond Hill s Vehicles & Equipment assets follow regulated requirements and the manufacturers recommended preventative maintenance schedules. Options analysis is focused around the timing of the end of life disposal of a vehicle and around purchase of new vehicles. A Fleet Utilization Study is underway which will establish standards for the optimum usage of vehicles and right-sizing the fleet Parking Lots Asset Management Strategies Asset management strategies for the Townowned parking lots are currently being developed and will consist of strategies adapted from the Roadway System for use in a parking lot context. A full range of asset management strategies are proposed for this highly visible asset class (Table 36) moving forward Options Analysis and Project Prioritization Currently, Richmond Hill s Parking Lots have limited inspections and repairs are carried out on an as-needed basis. Moving forward there is an opportunity to adapt Roadway System strategies to the parking lot context and to track Monitoring, Operations & Maintenance and Repair decisions through the Maximo Work and Asset Management System. From an options analysis perspective, much of what is applied to the management of the Roadway System is applicable to Parking Lot assets. Winter road maintenance snow plow Table 36: Proposed (2016) Parking Lots Asset Management Strategies Monitoring Condition Assessment Operations & Maintenance Repairs Parking Lots Monthly inspection (Road Patrol) PMS update every 3 years. PQI used to rate parking lot surface condition Annual Sidewalk Rating System Sweeping Debris removal Crack sealing Asphalt cold patching Winter maintenance Line and marking repainting Light standards annual test Light standards annual maintenance Shouldering Curb repair Sign and post repair Graffiti removal Fence repair or replace Asphalt hot patching Asphalt cold patching Concrete grinding Mud jacking Interlocking base repair/reinstall Luminaire replacement Pole repair Pole replacement Electrical supply repair Major Rehabilitation End of Life Asphalt shave and pave Asphalt full overlay Asphalt infrared seal Asphalt micro-seal Sidewalk bay replacement Capital business case 97

100 Centennial Pool parking lot The need for rehabilitation is identified by condition assessment results outlined in a business case which includes the evaluation of alternatives. A condition assessment has been recently completed which identifies over $9 million in repairs and rehabilitation, which is very close to the value of the Parking Lot assets identified as being beyond expected end of life ($9.4 million) in Chapter 2. The recommendations from the condition assessment will be incorporated into the Town s ten year capital forecast. End of Life replacement of Parking Lot assets may be included during the upgrade of parks, carried out as part of a major building renovation, or proceed separately subject to an approved business case Key Findings Asset management strategies and options analysis for Parking Lots are currently being defined. Previously, Richmond Hill s Parking Lots were inspected irregularly and repairs were carried out on an as-needed basis. Many strategies for Monitoring, Operations & Maintenance, Repairs and Rehabilitation of the Roadway System are suitable to be adapted to the Parking Lot context. A condition assessment has identified over $9 million in repairs and rehabilitation which will be incorporated into the Town s ten year capital forecast Information Technology Asset Management Strategies Asset Management Strategies for the Information Technology assets focus on monitoring and preventative maintenance such as keeping hardware and software secure and virus free, providing software updates, backing up data and following manufacturers recommended maintenance schedules (Table 37). An eservice portal and Helpdesk are available to assist users with issues that are affecting their use of Information Technology assets. End of life replacement of desktop hardware is on a four year cycle and network hardware is on a five year cycle. Replacement frequency of smartphones and cellphones is based on contract renewal dates of 2 to 3 years and replacement of other Information Technology assets is subject to a business case evaluation. 98

101 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Table 37: Information Technology Asset Management Strategies Hardware Software Telecom Monitoring Security & Virus Scans Security & Virus Scans Operations & Maintenance Data backups Manufacturers recommended maintenance Annual maintenance contracts Software updates Repairs Service requests through eservice and Helpdesk Service requests through eservice and Helpdesk Service requests through eservice and Helpdesk End of Life Desktop computers replacement: 4 years Network components replacement: 5 years Capital business case Capital business case Capital business case Project Prioritization and Asset Acquisition Options analysis and project prioritization of Information Technology assets is currently undertaken on a project by project basis through the annual IT Capital Planning process. The Town is looking to improve this approach to include more proactive asset management strategies. An Information Technology Strategy is scheduled to be undertaken in 2016 and 2017 to update the asset management strategies and create a roadmap for keeping Richmond Hill s information technology systems effective and current. Unplanned service and repairs are tracked through the eservice portal. An update of the eservice portal is underway which is expected to generate additional information to assist with options analysis Key Findings Asset management strategies for Information Technology assets and data focus on scheduled monitoring and preventative maintenance as well as service requests through the eservice portal. An update to the eservice portal and the development of an Information Technology Strategy are expected to improve options analysis and project prioritization from a project by project basis to a more planned and integrated approach Other Equipment & Materials Other Materials & Equipment include a wide range of small value materials and equipment for which it is not practical to establish asset management strategies in the asset management plan. Staff management these resources following the manufacturers recommended maintenance, where they exist, and best practices. End of life replacement is subject to a business case. 99

102 4.13 Environmental Assets Asset Management Strategies Richmond Hill s Environmental Assets provide a range of environmental and community benefits. These assets are highly valued and residents have consistently identified the presence of parks and open spaces as being one of the most appealing things about Richmond Hill in the Community Surveys that the Town undertakes every few years. Environmental Assets are integrated into all aspects of community. Streams that are located in valleyland natural areas receive stormwater runoff from the urban areas and many of the Town s trails run along these streams. Street Trees line the roads and sidewalks that we travel on. There are thousands more trees and shrubs in parks and Natural Areas. Even trees on private property are part of our overall Environmental Assets as we will need additional natural cover on private property to maintain our tree canopy target of 25%. Richmond Hill has a long history of managing its Environmental Assets. As a result, there are a wide range of asset management strategies in place (Table 38). Table 38: Environmental Assets - Asset Management Strategies Street Trees Natural Areas Streams Monitoring Inspection Annual restoration site monitoring (baseline at 2 and 5 years) Stream flow and elevation Condition Assessment Tree Condition Inventory Natural Area Inventory Stream Condition Inventory Operations & Maintenance Block pruning Fertilizing Tree & shrub planting Watering & mulching Repairs Pruning Invasive species removal Emergency repairs Rehabilitation Community Stewardship Program Long Term Woodlot Restoration Program Healthy Yards Program LEAF s Backyard Tree Planting Program Valleyland Capital Works Priority Rating System identifies priority projects to include in the Ten Year Capital Forecast End of Life Street Tree Replacement Contract Emerald Ash Borer Strategy 100

103 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Strategies in the monitoring, operations and repair stages for Street Trees and Natural Areas focus on actions to keep trees healthy and resilient such as inspections, watering of young trees, mulching, fertilizing, pruning and removing invasive plant species. In Streams, water flow and elevation are monitored at key locations throughout the Town. Since work cannot routinely be done in streams without regulatory approvals, there is a process in place to undertake emergency repairs when necessary. For most of the Environmental Assets there is a heavy focus on rehabilitation and end of life replacement. The Emerald Ash Borer Strategy was developed in response to a major disturbance which will result in the mortality of virtually all of the ash trees in Richmond Hill, including thousands of Street Trees. The Strategy maps out the Town s response to protect, remove and replace these trees. For Natural Areas, the Community Stewardship Program works with partners and volunteers to plant and maintain trees and shrubs in small-scale priority areas. Two rehabilitation initiatives, the Health Yards Program and LEAF Backyard Planting Program, are dedicated to increasing natural cover on private property. Rehabilitation of Streams protects against damage to private property (such as homes on eroding banks) and public infrastructure (such as foot bridges and trails impacted by changing valleylands). The stream reaches are prioritized for work based on detailed condition assessments of the valleyland areas. Street tree planting 101

104 Options Analysis and Project Prioritization Monitoring, Operations & Maintenance and Repair decisions for Street Trees are tracked through the Maximo Work and Asset Management System. The widespread replacement of Ash trees follows the Council approved Emerald Ash Borer Strategy. Planned actions for Natural Areas result from analysis undertaken in the Natural Area Inventory and the Emerald Ash Borer Strategy. Recently, a long term Woodlot Restoration Program has recommended projects into the Ten Year Capital Forecast. Options analysis for rehabilitation of Streams follows the Valleyland Capital Asset Priority Rating System. This is a strong approach as it includes regulatory, condition, cost benefit and risk criteria to select areas for capital replacement or repair. Valleyland Capital Asset Priority Rating System Risk Management/Health & Safety (35%) Statutory & Regulatory Requirements (20%) Operations & Maintenance Considerations (15%) Cost Benefit Analysis (15%) Environmental Issues (10%) Community Concerns (5%) Key Findings Richmond Hill s Environmental Assets are widespread and are highly valued by the community. The Town has a history of managing its Environmental Assets. As a result there are asset management strategies in place for different stages of the asset lifecycle. There is a heavy emphasis on major rehabilitation and end of life replacement which is guided by strong options analysis in accompanying strategies. Richmond Hill s natural environment 102

105 Asset Management Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Ransom Park rehabilitation 4.14 Conclusions Richmond Hill has a range of asset management strategies and an options analysis process for most asset classes, focused on the different stages of the assets lifecycle. Overall, decisions to apply asset management strategies are made through the Work and Asset Management System to operate, maintain and repair the asset, through condition assessment and business cases at the rehabilitation stage, and through an integrated priority rating system or lifecycle management software at end of life. The strongest approaches exist for the roadway surface, buildings, water and wastewater. There is an opportunity to invest in additional asset management strategies for stormwater assets (preventative maintenance) and parks and outdoor recreation assets (monitoring, preventative maintenance and rehabilitation). In addition, for all asset classes, there is an opportunity to strengthen options analysis at each stage as well as link the decisions across the stages to see how they affect the overall longevity and lifecycle cost of the asset. 103

106 5.0 Financial Strategies The Financial Strategies chapter is the last chapter of the story describing the current state of asset management planning at the Town of Richmond Hill and combines the state of Richmond Hill s infrastructure, the levels of service and asset management strategies with financial planning and budgeting to ensure that there is a sustainable revenue stream to fund the long term management of the Town s assets. Each piece of the asset management plan tells us something important. The State of Local Infrastructure tells us the life expectancy of our assets and their replacement cost. The Levels of Service and Asset Management Strategies tell us what we need to do to maintain our assets in a condition that meets the needs of the community. Finally, the Financial Strategies identify how we will fund the management actions that we need to take. This chapter answers the questions, how much will it cost? and how will we fund it? 104 Tannery Park

107 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N In Richmond Hill, financial strategies revolve around the annual budget processes and are aligned with the Town s Strategic Plan and other approved plans. Through Richmond Hill s budget process, revenue sources are confirmed and forecasting is undertaken including the management of reserves. The budgets ultimately authorize spending and identify the funding sources for projects and programs. 5.1 Annual Budget Process The Town of Richmond Hill s budget is guided by the Town s budget principles and involves two separate annual budget processes: The Operating Budget and the Capital Budget (see text boxes). Operating Budget Richmond Hill's Operating Budget consists of expenses that cover day-to-day activities or operations, including items such as utilities, rent, insurance, staff wages and benefits, program supplies, transportation and repairs. Capital Budget Richmond Hill s Capital Budget and 10 Year Capital Forecast is a comprehensive financial plan that addresses the financial requirements of growth and the renewal and replacement of existing infrastructure, including community centres, fire stations, pools, parks, trails, arenas, roads and sidewalks, to name a few. Richmond Hill s Budget Principles Maintain existing service levels Minimize the tax rate impact Remain true to Town of Richmond Hill s financial principles: Thorough short and long term planning Prudent consideration of reserves Leverage available funding sources Town Council ( ) 105

108 The annual Operating Budget is subdivided into the rate supported budget and tax supported budget. In the context of the asset management plan, the rate supported budget allocates funds for the operation, maintenance and repair lifecycle stages of water, wastewater and stormwater assets. Users of these assets or service are billed directly and the revenue collected for can only be used to operate, maintain and repair these assets. Tax supported assets include all other infrastructure assets such as roads, parks, buildings, fleet and information technology and similar to rate supported assets, collected revenue is allocated for the operation, maintenance and repair lifecycle stages of these assets. The Capital Budget is divided into the annual Capital Budget and the 10 Year Capital Forecast. In the context of asset management planning, the annual Capital Budget allocates funds each year for new growth assets, primarily funded from development charges, and for the rehabilitation and replacement lifecycle stages of existing infrastructure assets funded primarily from tax levy. The 10 Year Capital Forecast is a comprehensive plan identifying priority projects for growth, rehabilitation and replacement over the next ten years. 5.2 Revenue Sources Overview Financing Growth Assets Since the 1950 s the development industry has been required to provide the necessary infrastructure to make their developments a reality, including the roads, street lighting, water, sewer, parkland and land for schools. Some of the assets are built by the developer, and for other assets, various levies are assessed and used by the Town to build the necessary infrastructure. The funds raised from Development Charges and Cash in Lieu of Parkland fund most growth assets, and are budgeted for in the 10 Year Capital Forecast. In some cases, Development Charges funds less than 100% of the asset and general tax levy funds are used to fund the remainder. Other times, the Development charges and Cash in Lieu of Parkland funds are used to partially pay for upgrades to existing infrastructure, where growth has created the need for the upgrade, or where replacing the old asset would not meet current demands due to growth. Because growth assets have their own revenue source that is not discretionary, and that there are no asset management strategies to apply to the assets until they become owned by the Town, growth assets are mostly excluded from the asset management plan. Richmond Hill has a wide range of revenue sources (Table 39) to support the ongoing management of infrastructure assets. A number of these revenue sources are restricted to the acquisition of growth assets, which are usually acquired or funded through the development process (see Financing Growth Assets text box). There is a smaller range of revenue sources available to operate, maintain, repair, rehabilitate and replace existing infrastructure. 106

109 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Bayview Hill Community Centre Table 39: Town of Richmond Hill s Revenue Sources Revenue Source Property Tax User Fees for Water, Wastewater and Stormwater User Fees and Charges Sale of Assets Interest on Reserve Balances Development Charges Cash in Lieu of Parkland Local Improvement Charges Federal Gas Tax Grants Grants Debt* Alternative Financing & Procurement* Description Residential and commercial property owners pay an annual tax to the Town, which pays for many of the services used by the residents and owners. Directly billed for residential or business use of the water, wastewater and stormwater systems. Funds collected for the use of Town services or infrastructure. Examples include fees for recreation programs and business licenses. This includes, but is not limited to the sale of surplus land, vehicles and equipment that have reached end of life, and sale of older books. The Town holds money in reserve funds for regulated and discretionary reasons. These funds earn interest that is a revenue stream. Contributions from developers used to fund growth related infrastructure. Funds collected from developers, as prescribed in the Planning Act, are used to purchase and develop new parkland. Fees charged to property owners for local upgrades, such as upgrading the road network from a rural to urban profile. A long term grant agreement with the Federal government that provides a portion of the Federal gas tax revenues to municipalities. Grants are contributions from parties external to the organization. This typically comes from grants from senior levels of government. Normally used to purchase an asset outright. Must be offset with new future revenue or a reallocation of revenue. A rent to own agreement: municipal payment agreement with a private company for the construction and long term operation of an asset that eventually leads to a transfer of the asset to the municipality. Must be offset with new future revenue or a reallocation of revenue. * Debt and Alternative Financing & Procurement are financing tools, not sources of revenue. From a revenue perspective they are future negative revenue streams, an expense. 107

110 5.2.2 Current and Historical Revenue Sources Asset management activities to operate and maintain existing infrastructure are funded through the Operating Budget. From 2014 to 2016 the portion of Divisional operating budgets that support asset management strategies has grown from just over $45 million to almost $51 million (Table 40). The majority of these activities are funded by the property tax, which accounts for just over 70% of the total, or the water or wastewater rate which accounts for around 16% (Figure 43). The remaining sources each contribute individually an average of 1 to 3% of the annual total operating revenue. Table 40: Current and Historical Operating Budget Revenue Sources for Asset Management Strategies Revenue Source 2014 Revenue ($ million) Property Tax Water and Wastewater Rate Stormwater Rate User Fees, Charges & Permits Recovery from Others Transfer from Reserves TOTAL Figure 43: Average Annual Operating Budget Revenue Sources ( ) for Asset Management Strategies 3% 2% 5% 3% 16% 71% Property Tax Water & Wastewater Rate Stormwater Rate User Fees, Charges & Permits Recovery from Others Transfer from Reserves 108

111 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Asset management activities involving major repair, rehabilitation and replacement of existing infrastructure assets have funding allocated through the Capital Budget. The funding sources for the Capital Budget are typically reserve funds which have accumulated revenue over the years from property tax, user fees, gas tax or sales of assets revenue sources (Table 41). The Capital Budget allocated to asset management strategies of existing assets may vary from year to year depending upon the assets that are nearing their end of life that have been prioritized for reinvestment, and the number of growth asset projects that need to be undertaken in that year. Funding Source Table 41: Current and Historical Capital Budget Funding Sources for Asset Management Strategies 2014 Allocated Funds ($ million) Repair & Replacement Reserve Funds Gas Tax Reserve Fund Cash to Capital Reserve Fund Local Improvement Charge Grants 1.0 Debt Financing 8.6 TOTAL From 2014 to 2016 the Capital Budget assigned to rehabilitation or replacement of existing assets (Table 41) averaged $31 million and ranged from $19.0 to $51.1 million. The conversion of streetlights to LED technology, a $12.5 million project, was funded in 2016 and is included in the allocated funds for that year. The biggest funding source for rehabilitation or replacement of existing assets are the Repair & Replacement Reserve funds which provided, on average, two thirds of the annual funding. It is interesting to note that the Town engaged in debt financing (borrowing from an internal reserve fund) for the first time in recent history for the Streetlight LED conversion project based upon the business case that the savings in electricity will pay back the debt in a reasonable length of time. One funding source that is significant but has been under-represented over the past three years is Grant Funding. Since 2008, the Town has brought in over $30 million in grant funding. Averaged out over this period, Grant Funding would amount to about $3.75 million per year. However, the timing of grants is unpredictable and difficult to forecast. Eyer Wideman House 109

112 5.2.3 Revenue Forecast As part of the Operating Budget process, Richmond Hill prepares a Three Year Financial Outlook. The outlook for forecasts a need for increases in revenue ranging between 3.10% and 4.39% annually over this period (Table 42). Applied to the 2016 Operating Budget for asset management strategies in Table 40, revenue for asset management strategies can be forecasted to rise to $53.1 million in 2017, $55.4 million in 2018 and $57.1 million in Table 42: Three Year Operating Budget Financial Outlook Pressure 2016 Budget 2017 Outlook 2018 Outlook 2019 Outlook Base 1.72% 1.49% 1.56% 1.19% Non-Base 2.53% 2.82% 2.82% 1.90% Increase in Taxation 4.25% 4.31% 4.39% 3.10% *Base includes: inflationary changes *Non-Base includes: growth and increases to levels of service 5.3 Reserve Funds The Capital Budget describes and authorizes spending of funds on infrastructure growth, replacement, rehabilitation and major repairs, and the sources of funds are different than the Operating Budget. All Capital Budget items are funded from reserve funds, each of which holds money for specific purposes. Some reserves are intended to accumulate money to pay for future asset maintenance. Others are used to stabilize the revenue demands where there is volatility in the amount of money needed each year, with the reserve growing in low demand years and being drawn-down in higher cost years. The use of reserves for growth assets are highly regulated with clear definitions of allowable uses. A small number of reserve funds can be used for building new assets associated with growth or for rehabilitation and replacement of existing assets, based on direction from Council. Because growth reserve funds cannot be used for capital maintenance, rehabilitation or replacement of existing assets, only the funds that can be used for existing assets are modeled in the next sections of the Asset Management Plan. Richmond Hill Centre for the Performing Arts 110

113 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Reserve Fund or Financing Tool Allowed Uses Table 43: Capital Reserve Funds Description 2015 Balance ($ million) Repair & Replacement Reserve Existing Assets To provide for repairs and infrastructure replacement to maintain existing capital facilities and structures in full service and safe operating condition. 105 Cash to Capital Reserve Fund Existing Assets & Service Expansion To provide funds for capital projects considered new items not eligible for funding from Development Charges nor Repair & Replacement Reserve Funds. (0.23) Water Quality Protection Reserve Fund Existing Assets & Service Expansion To be used on rehabilitation of environmental storm water management systems and to add environmental systems to ensure continued flood protection, erosion control, downstream watercourse and habitat quality protection, and the protection of drinking water sources Water/Wastewater Reserve Funds Existing Assets To provide for full cost recovery for repairs and infrastructure replacement to maintain existing water & wastewater facilities and structures in full service and safe operating condition Federal Gas Tax Grant Reserve Fund Growth & Existing Assets Grants are contributions from parties external to the organization. This is typically grants from senior levels of government. This grant is specifically funded from Federal gas taxes. 8.4 Ecological Legacy Reserve Council Discretion To be used on community based projects for furthering ecological initiatives. 3.0 Development Charges Reserve Growth Contributions from developers are used to fund eligible growth related infrastructure Cash in Lieu of Parkland Reserve Growth Funds collected from developers, as prescribed in the Planning Act, are used to purchase and develop new parkland Community Enhancement & Economic Vitality Reserve Growth Funding of projects that enhance the quality of life or enrich the economic vitality of the community Strategic Rapid Transit Reserve Fund Growth To be used for funding long range strategic rapid transit projects which are multi-jurisdictional in nature. Funding committed by the Town would be used to leverage and attract significant funding from other levels of government and or public-private partnerships

114 5.3.1 Annual Contributions to Reserve Funds The Operating Budget identifies annual contributions to the Repair & Replacement Reserve Funds to maintain the capacity to fund projects identified in the 10 Year Capital Forecast. Annual contributions from 2016 (confirmed) and 2017 to 2019 (projected) are identified in Table 44 for key reserve funding sources for funding asset management strategies. Table 44: Forecasted Contributions to Repair & Replacement Reserve Funds Revenue Source Reserve Fund Allocation ($ million) Property Tax Repair & Replacement Reserve Funds Water & Wastewater Rates Water & Wastewater Reserve Funds Stormwater Rates Water Quality Protection Reserve Fund Gas Tax Federal Gas Tax Reserve Fund Expenditures Current and Historical Expenditures Through the annual Operating and Capital Budgets, Richmond Hill authorizes expenditures to manage our infrastructure assets through the different stages of their life cycle. The range of asset management strategies that are available to cost-effectively manage the Town s assets have been described in Chapter 4. The budgets allocate the resources the Town is applying to different asset management strategies. From 2014 to 2016 the largest budgeted expenditures ($20.1 million) were for the Roadway System. The second largest historical expenditure was for Buildings at $13.8 million followed closely by Parks & Outdoor Recreation ($10.9), Information Technology ($10.3 million) and the Water and Wastewater Network ($10.2 million). It is interesting to note that investment in the smaller asset classes, such as Information Technology and Fleet, is significant due to the extent of operations and maintenance required and the frequency with which assets need to be replaced due to their shorter service life. Investment in Stormwater Management assets ($3.2 million) is lower than planned for in the stormwater financial sustainability plan, but is growing. Currently, budgeted expenditures are not categorized according to the asset management strategies or lifecycle stages. Not all classes had budgeted expenditures for each stage of the asset lifecycle. To illustrate, end of life replacement of an entire building is rare; more often, individual components or systems are replaced when they near their end of life. As a result there are no budgeted expenditures for replacement of Buildings but there are significant expenditures for rehabilitation. For Vehicles & Equipment and Information Technology assets there are no budgeted rehabilitation expenditures. These assets are either repaired or replaced through the Capital Budget. There is an opportunity in the future to better align tracking of expenditures to the life cycle stages of the assets. 112

115 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Figure 44: Average annual budgeted expenditures by asset class from 2014 to 2016 (in $ million) $6.2 $10.3 $20.1 Roadway System Buildings Stormwater Management $10.9 Water & Wastewater Network Parks & Outdoor Recreation $13.8 Vehicles & Equipment $10.2 $3.2 Information Technology Overall, from 2014 to 2016 across all asset classes an average of 58.1% of budgeted expenditures supported Operating, Maintenance and Repair strategies, 13.1% supported Rehabilitation and 28.8% were dedicated to end of life Replacement (Table 45 and Table 46). There were no significant expenditures related to disposal of assets. Water & Wastewater, Parks & Outdoor Recreation and Information Technology asset classes had budgeted expenditures weighted towards the Operating, Maintenance and Repairs activities (Figure 45). Roadway System, Stormwater Management and Buildings assets had more of a balance between Operating/ Maintenance/Repair and Rehabilitation/Replacement and Vehicles and Equipment assets were more weighted towards Rehabilitation and Replacement. There are no industry guidelines or best practice for setting targets for the distribution of investment between the asset lifecycle stages. This information provides a baseline to create targets and track performance moving forward. Figure 45: Breakdown of Budgeted Expenditures by Lifecycle Expenditure Type ( ) Roadway System Buildings Stormwater Management Water & Wastewater Network Parks & Outdoor Recreation Vehicles & Equipment Information Technology Source: 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Operations, Maintenance, Repairs Rehabilitation Replacement 113

116 Table 45: Operating Budget Supported Asset Management Strategies Annual Budgeted Expenditures Solar Panels at Elvis Stojko Arena Asset Class Asset Management Strategy Budget ($ million) Roadway System Operating/Maintenance/Repair Buildings Operating/Maintenance/Repair Stormwater Management Operating/Maintenance/Repair Water & Wastewater Network Operating/Maintenance/Repair Parks & Outdoor Recreation Operating/Maintenance/Repair Vehicles & Equipment Operating/Maintenance/Repair Information Technology Operating/Maintenance/Repair Roadway, Parks, Water, Wastewater & Stormwater Administration of End of Life Replacement Table 46: Capital Budget Supported Asset Management Strategies Annual Budgeted Expenditures Asset Class Asset Management Strategy Budget ($ million) Roadway System Rehabilitation End of Life Replacement Buildings Rehabilitation Stormwater Management Rehabilitation End of Life Replacement Water & Wastewater Network Rehabilitation End of Life Replacement Parks & Outdoor Recreation Rehabilitation End of Life Replacement Vehicles & Equipment End of Life Replacement Information Technology End of Life Replacement

117 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Year Capital Forecast The 10 Year Capital Forecast provides a financial expenditure forecast that: Considers corporate priorities that align with the Town s Strategic Plan and various capital and service plans; Exists as a living plan that allows for updating and reprioritizing as opportunities arise; Identifies to Council any significant future projects that potentially could be added to the forecast that could not be quantified at this time; Identifies potential challenges in the upcoming Operating Budget based on the 10 Year Capital Forecast that could impact the Overall Budget Strategy; Utilizes the project prioritization systems presented in Chapter 4. The 10 Year Capital Forecast for 2017 to 2026 is $742.4 million of which $288.0 million is associated with existing assets (38.8%) and $454.4 million is related to growth assets (61.2%). The distribution of annual capital forecasts for existing infrastructure assets (Figure 46) ranges from $23.8 million to $39.9 million per year. While less than the 2016 approved capital budget for rehabilitation and replacement of assets ($51.1 million), these figures are in line with levels of expenditures in 2014 to 2015 (see Table 41). Figure 46: 10 Year Capital Forecast (2017 to 2026) for Existing Assets Millons $45 $40 $35 $30 $25 $20 $15 $10 $5 $ Existing Assets The key funding sources for the 10 Year Forecast for existing assets are the tax supported and rate supported repair and replacement reserve funds that, combined, provide 87.2%% of the total funding (Figure 47), followed by the gas tax reserve at 12.8% of the funding. 115

118 Figure 47: 10 Year Capital Forecast (2016) Distribution of Funding Sources $37.9 M 13% $36.4 M 13% $211.0 M 74% Tax Supported Federal Gas Tax Rate Supported 5.5 Financial Strategies Capital Asset Replacement Strategy As with other municipalities in North America, the Town of Richmond Hill is facing the challenge of the infrastructure funding gap - the difference between the funding needed to keep assets in a state of good repair and the revenue from available sources. The amount of tax levy revenue allocated to tax levy supported capital repair and replacement reserve funds provided through the annual Operating Budget is inadequate to cover future asset repair and replacement responsibilities for those assets, as can be seen in Table 47. The desire to keep property taxes low has limited the Town's contributions to its existing capital assets resulting in a growing funding gap and deferred maintenance backlog. Funding for the timely replacement of capital assets is one of the cornerstones of financial sustainability. However, closing the funding gap must be balanced against the desire for low levels of taxation and other urgent priorities that the Town may face. Time Horizons for Asset Management Planning The 10 Year Capital Forecast uses condition assessments and prioritization tools like ReCAPP and the Road Reconstruction Priority Rating System to create a capital plan for the next ten years. The currently approved plan extends to 2025 and is fully funded. The Capital Asset Replacement Strategy uses the estimated end of life and replacement costs of assets to quantify the expenditures needed over the long term to ensure the sustainability of infrastructure assets. This Strategy has now been expanded to 100 years and identifies a funding gap. Measures have been set in place from 2016 to 2025 to reduce the long term funding gap. Future updates to the Capital Asset Replacement Strategy will recommend additional steps to be taken to ensure financial sustainability over the long term. 116

119 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Richmond Hill s Capital Asset Replacement Strategy looks at long term financial implications for infrastructure rehabilitation and replacement. In November 2015 the most recent capital asset replacement strategy was presented to Council. The report found that existing plans to stabilize and fund the water, and wastewater reserves would be sustainable going forward without additional approvals from Council (Table 47). This means that the current long-term financial plan for the Water Network and Wastewater Network assets is sustainable given the current understanding of asset renewal needs. In addition, there is an approved phase in period for increased contributions to the stormwater reserve and the long-term sustainability of Stormwater Management assets, based on current asset management assumptions, will be achieved when the phase in period ends in Asset Class Table 47: 2015 CARS Rate Supported Assets Summary Historical Cost ($ Millions) First Cycle Replacement Cost ($ Millions) Average Annual Contribution for 100% Provision ($ Millions) 2015 Budget Contributions ($ Millions) Rate Supported Stormwater $9.4 $1.3 Wastewater Water Water & Wastewater $222.1 $944.8 Subtotal Rate Supported $526.7 $1,590.4 $6.2 $6.2 For the tax supported assets (Table 48), the capital asset replacement strategy identified that the full long-term replacement costs of these assets are $54.4 million per year compared to the 2015 contribution of $6.4 million per year. This represents a funding gap of $48 million per year. Asset Class Table 48: 2015 CARS Tax Supported Assets Summary Historical Cost ($ Millions) First Cycle Replacement Cost ($ Millions) Average Annual Contribution for 100% Provision ($ Millions) 2015 Budget Contributions ($ Millions) Tax Supported Assets Buildings ,334.8 $54.4 $6.4 IT Machinery & Equipment Land Improvement Library Vehicles Roadway Systems ,029.4 Subtotal Tax Supported $1,157.0 $3,785.1 Grand Total: Tax & Rate Supported Assets $1,683.7 $5,375.5 $70.0 $

120 The strategy looked at a various methods of contribution to mitigate the tax supported assets funding gap, including: CARS provision - Contributions equal to 100% provision as per the 2014 CARS model; Historical funding - Contributions equal to average of previous capital funding amounts; Amortization - Contributions equal to annual capital asset amortization; Pay As You Go - Contributions equal to the proposed allocations in the 10 Year Capital Forecast. The Pay As You Go approach was selected as the model to move forward and the strategy focused on how to ensure that there were sufficient funds in the repair & replacement reserves to fund the current ten year capital forecast, utilizing all of the existing reserve fund balances to reduce the size of the revenue increase. As a result of this approach, Council approved an annual 1% increase to the contributions to the tax supported Repair & Replacement reserves that will increase annual contributions to the reserves from $6.4 million (2015) to $16.6 million per year by This means that tax supported assets are fully funded for the next 10 years to However, this will result in the reserve being fully exhausted at the end of this period (Figure 48). Funding for the Cash to Capital Reserve was retained at the historical level and other options for some projects will need to be identified to avoid putting the Cash to Capital Reserve in a negative balance (Figure 49). $60.0 Figure 48: Repair and Replacement Reserve Fund 2017 to 2026 $50.0 $40.0 Millons $30.0 $20.0 $10.0 $ R&R Reserve Fund Balance Tax Supported Capital Forecast Expenditures R&R Estimated Contributions 118

121 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Figure 49: Cash to Capital Reserve Fund 2017 to 2026 $100.0 $80.0 $60.0 $40.0 $20.0 Millons $0.0 -$ $40.0 -$60.0 -$80.0 Cash to Capital Reserve Fund Balance Capital Forecast Expenditures Current Contribution Year Asset Replacement Model One of the key opportunities presented by the Asset Management Plan is to update the model used for the Town s capital asset replacement strategy, to incorporate a longer analysis timeframe that captures at least one replacement cycle of all assets. The model now also includes repeated replacement of short life-span assets. Another significant change was to adopt the now widely used current dollar replacement cost approach where the assets are valued assuming they had to be replaced today. The 100 year asset replacement model tracks when all of the Town s 40,000+ assets are estimated to need replacement based upon their expected life and calculates the percentage of assets (by dollar value) reaching end of life (Figure 50) and the replacement costs of all assets (Figure 51) for each year in the 100 year period. Rehabilitation of Bond Lake Arena 119

122 8% 7% 6% 5% 4% 3% 2% 1% 0% Figure 50: Annual Percentage of Assets (by dollar value) Reaching Estimated End of Life The average percentage of assets reaching end of life each year is 2.86% (Figure 8) of the total replacement value of the assets. Matching the amount of investment to replace the assets as they reach end of life will result in the sustainable management of assets. In contrast, a lower reinvestment rate will result in a repair and replacement backlog expanding the infrastructure gap. The most recent Canadian Infrastructure Report Card identifies average and recommended reinvestment rates for road, building, water, wastewater and stormwater assets. The recommended reinvestment rates ranges from 1% for very long lived assets to 3% for medium lifespan assets such as the roadway surface and sidewalks. Short lived assets like vehicles and information technology assets require higher reinvestment rates from 10% to as high as 25% annually. Millons Figure 51: Value of Assets Reaching Estimated End of Life $140.0 $120.0 $100.0 $80.0 $60.0 $40.0 $20.0 $ Tax Supported Rate Supported 120

123 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N The 100 year replacement forecast estimates that between 2014 and 2113 the assets reaching their expected end of life will require $5.2 billion in capital funds to replace them, an average of $52.7 million per year (Table 49). This is divided between the rate supported assets and the tax supported assets (Figure 51). $1,024.2 million of this is attributable to the rate supported assets, which require no additional actions be taken for their long-term financial sustainability. This leaves about $4.2 billion of tax supported assets which will require annual contributions of $42.5 million per year over the 100 year period to be financially sustainable. Contributions to the tax supported asset repair and replacement reserves are scheduled to grow from $6.4 million in 2015 to $18 million in 2025, fully supporting infrastructure replacement over this ten year period. The preliminary ten year capital budget forecast update for 2017 extends the period where infrastructure replacement is full funded to After 2027 additional contributions to tax supported asset repair and replacement reserves will need to be phased in to for the Town to continue to be financially sustainable. The additional contributions to close the funding gap grow from an estimated at $8.7 million in 2028 to $24.5 million over time to cover the replacement of Richmond Hill s existing infrastructure assets as they reach their end of life. The next section, Scenario Planning, will look at the options to close this funding gap. Asset Class Table 49: 100 Year - Forecast Revenue Contributions and Replacement Costs Current Value Replacement Cost 100 Year Total Replacement Cost Tax Supported $ 1,594.1 M $ 4,248.0 M Average Annual Replacement Cost Revenue Contributions to Reserve Funds Roadway System $ M $ 1,443.2 M $ 42.5 M $6.4 M Buildings $ M $ 1,394.4 M (2015 actual) Parks & Outdoor Recreation $ M $ M Vehicles & Equipment $ 28.4 M $ M Parking Lots $ 23.6 M $ M Information Technology $ 16.0 M $ M Other Equipment & Materials $ 23.1 M $ M $18 M (2025 forecast) Rate Supported $ M $1,024.2 M Stormwater Management $ M $ M $10.2 M $7.5 M Water Network $ M $ M (2015 actual) $8.8 M Wastewater Network $ M $ M (2019 forecast) Grand Total $ 1,845.7 M $ 5,272.2 M $ 52.7 M 121

124 5.5.3 Financial Scenario Planning There are a range of financial tools available to municipalities to address the funding gap for tax supported infrastructure assets. The focus of this section is on addressing the growing gap between forecast revenues and expenses for tax supported assets beyond The rate supported assets will achieve financial sustainability with existing financial plans and are not further discussed here. Nine tools which have potential for Richmond Hill are listed in Table 50. Each of these tools and the applicability to Richmond Hill is discussed separately below. Table 50: Potential Financial Tools Option Description Impact Increase Repair & Replacement (R&R) contribution by inflation percentage each year Increase Repair & Replacement (R&R) contribution by growth percentage each year Increase the Capital Sustainability Levy Allocate Gas Tax Pursue other revenue sources Extend end of life Increased deferred maintenance Debt Alternative Financing and Procurement * Repair and Replacement The Operating Budget is increased by an inflation amount each year; carry this increase (or a capital specific percentage) through to the allocations to R&R* reserve funds. The Operating Budget is increased by a growth amount each year; carry this increase through to the allocations to R&R* reserve funds. Continue to increase the Capital Sustainability Levy on the tax bill after the currently approved rate increases for are implemented. Designate 50% of Gas Tax revenue to reduce the R&R* revenue need as part of the Capital Budget Strategy. Attract alternative funding through partnerships and grants. Assume that the risks of unplanned failures are small enough that most assets can be operated beyond their estimated end of life. Allow the amount of assets in Beyond or Nearing End of Life to increase. Pay for peaks of R&R* work with debt, based on existing Debt Policy. Use of Public-Private Partnerships to deliver the necessary R&R* work. Eliminates inflation uncertainty from the asset sustainability model, greatly increasing the reliability and usability of the model. Not including this increase expands the asset funding gap by inflation each year. Eliminates growth uncertainty from the asset sustainability model. Growth results in more assets and higher use of infrastructure; both result in higher future costs. Continues the current program to phase in taxation increases to cover infrastructure replacement. Gas Tax is approximately $5M annually; allocate $2.5 M annually to R&R.* Will not be available to fund growth projects. Due to the one-time or unpredictable nature is not a reliable funding source. However, over the long term, has had an average of $3.75M annually. Increasing the lifespan of tax supported assets by 25% results in an average of $35.8 M reaching end of life each year, a drop of $8 M annually. Higher operational costs and higher emergency repair costs may offset some of the potential $8 M. Does not reduce total costs, defers the costs to a future year. May result in higher operational costs and impacts to levels of service. Increases total cost. Alternative Financing and Procurement payments result in higher total costs. 122

125 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N The first two tools, increasing the tax rate contribution annually to match inflation and to match growth, will help to ensure the current gap does not get larger over time but will not help to close the current gap. There is an opportunity in the short-term to consider these strategies as part of the Operating Budget to ensure that the additional contribution in the Capital Sustainability Levy is not eroded by inflation and growth. The Capital Sustainability Levy, a dedicated tax levy on residential and business properties, is currently the main tool for closing the infrastructure funding gap. Council has approved a plan to fully fund the current ten year capital forecast which will see Capital Sustainability Levy contributions increase from $6.4 million in 2015 to $18.0 million in There is an opportunity to extend or accelerate the Capital Sustainability Levy contributions when the next Capital Asset Replacement strategy is prepared. Debt Debt brings the value of future payments to the current year and pays interest to enable this acceleration. From a long term asset management perspective, using debt to replace existing assets begs the question Why was not enough money put aside to pay for this known expense? From a total cost perspective, debt must be repaid, which means that there is no reduction in total costs. Low interest rates are not a justification for debt; the total costs are still higher than if the funds had been slowly accumulated and the asset replaced at its end of life. Richmond Hill receives over $5 million in Federal Gas Tax Funding each year. Currently these funds are allocated to strategic projects following criteria outlined in the Capital Budget Manual. There is an opportunity to allocate 50% of these funds in future Capital Budgets towards the replacement of existing infrastructure assets, reducing the infrastructure gap by around $2.5 million. Swimming Pool at Oak Ridges Community Centre Richmond Hill has a well-developed program to pursue grants from other levels of government to help towards the renewal of aging infrastructure. While infrastructure grant programs are not steady from year to year, Richmond Hill has secured an average of $3.75 million per year over the past eight years amounting to over 10% of the average annual budget for the replacement of assets in the Ten Year Capital Forecast. Continued investment in grant seeking opportunities is recommended. 123

126 Richmond Hill s Tangible Capital Assets policy has defined end of life ranges for different classes of infrastructure and future expenditure requirements for the replacement of infrastructure are based on these assumptions. There is an opportunity as Richmond Hill improves the quality of asset inventory and condition data through a condition assessment program to assign a longer end of life to certain assets thereby reducing the forecasted expenditures and need for revenue. Improving the quality of data is a well-supported opportunity throughout the Asset Management Plan and benefits could be seen from an investment over the next three to four years. The final three tools, increasing deferred maintenance, debt and alternative financing and procurement do not help close the infrastructure funding gap for existing infrastructure. Deferred maintenance does not reduce expenditures; instead it defers them Alternative Financing and Procurement (AFP) Leverages the private sector to build municipal infrastructure and can result in lower total costs, though the most prominent driver for using AFP is lower risk and higher predictability for the project. In the context of asset management planning for existing assets, none of the Town s assets meet the suggested Infrastructure Ontario AFP minimum project cost ($100M) and these replacements are considered low risk projects, eliminating the AFP advantage for risk reduction. Under some circumstances AFP has the potential to have lower total lifecycle costs for the municipality than traditional procurement, but it is restricted to very large (>$100M) projects. to future years while increasing operational costs and risk of service failure. Likewise debt increases the total cost over the long-term as the principal and the interest need to be paid back. The replacement of existing infrastructure assets typically does not meet the eligibility requirements for alternative finance and procurement and would not result in lower overall long-term costs. Wise management of our resources, with a focus on both this generation and those that follow requires re-examination of the intergenerational fairness concept. With almost all municipal assets originally acquired at low or no cost to the municipality, today s residents should be funding the replacement of current assets they are the future generation that is using these existing assets. 124

127 Financial Strategies R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Photo credit: Conclusions Oak Ridges Community Centre Richmond Hill has well established financial processes to manage infrastructure including the annual Operating and Capital Budgets, 10 Year Capital Forecast and Capital Sustainability Strategy. Rate supported assets (Water, Wastewater and Stormwater) will be fully financially sustainable for the long term in the next ten years. Tax supported assets (Roadway System, Buildings, Parks & Outdoor Recreation, Vehicles & Equipment, Parking Lots, Information Technology, Other Equipment & Materials and Environmental) are fully funded to 2027 but require additional investment to become sustainable over the long term. The funding gap is predicted to grow in the first few years beyond 2027 starting at $8.7 million in The long term (100 year) forecast for the replacement of all infrastructure assets predicts that the gap will eventually reach $24.5 million per year. Short to medium term opportunities to reduce the infrastructure funding gap include: indexing Capital Sustainability Levy contributions to growth and inflation, committing a portion of the annual Gas Tax funds, attracting grants and partnerships, and improving data quality to see if asset lifespans can be extended. A longer term opportunity is to continue to increase the Capital Sustainability Levy through regular updates of Richmond Hill s Capital Sustainability Strategy. 125

128 6.0 Implementation This chapter outlines recommended actions that will advance the asset management system. Throughout the creation of the asset management plan opportunities for improvement to the existing system were identified. The recommended actions in this chapter include practical steps to address these opportunities. The actions are grouped into four categories: Establish Policy, Governance and Administration Strengthen Existing Asset Management Processes Expand the Asset Management Plan Improve Tools and Resources The rate of progress on implementing these actions will depend on available resourcing as well as prioritization within the larger mandate of the implementing organizations. 126 Phyllis Rawlinson Park

129 Implementation R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Establish Policy, Governance and Administration The Building Together guidelines focus on the content of an asset management plan. Effective asset management is more than reporting on the state of the assets, it includes policy and governance frameworks for setting long term direction. The recommended actions in this section provide for stronger organizational responsibility and accountability for Richmond Hill s $1.85 billion in capital assets. Action 1 Adopt a Council approved policy statement on the value and importance of asset management planning for achieving the Town s strategic outcomes. 2 Formalize where oversight of the asset management plan and implementation resides in the Town s organization structure. 3 Report on State of Infrastructure, key performance measures and asset management plan implementation progress annually. Short Term Medium Term Long Term 4 Review and update the corporate Asset Management Plan every four years. William Neal Park 127

130 Strengthen Existing Asset Management Processes Asset management seeks to answer the seven key questions presented in this asset management plan. Opportunities to advance the Town s current asset management system are organized according to these questions in the chart below. Some of the recommended actions include opportunities for all asset classes and other actions require work in only a few asset classes. Each recommendation will require further examination to define the scope and resources necessary to respond to the action. Action What do we own and what is their condition? What are they worth? 5 Transition the asset management plan to condition-based analysis from age-based analysis, emphasizing the need for asset inspection programs. 6 Convert the Tangible Capital Asset (TCA) inventory into an asset database and validate the existing data. Short Term Medium Term Long Term 7 Develop a Town-wide asset data management framework. 8 Re-evaluate the lifespans of assets to consider condition-based analysis and current industry common practice. How are they performing? 9 Review existing levels of service and fill in baseline data and missing targets. 10 Establish levels of service for street trees. What actions do we need to take? When do we need to do it? 11 Improve usage of Maximo to better track asset management activities and report on both costs and the frequency of use of asset management strategies. 12 Investigate and implement advanced asset management tools for options analysis of maintenance, repair, rehabilitation and end of life opportunities for different classes of infrastructure with a view to better integrating the corporate asset management system. 13 Review and update, if necessary, the capital replacement prioritization criteria. 14 Increase the focus and priority on planned preventative maintenance and rehabilitation. 128

131 Implementation R I C H M O N D H I L L A S S E T M A N A G E M E N T P L A N Action Short Term Medium Term Long Term How much will it cost? How will we fund it? 15 Evolve budget and expenditure tracking to record what type of asset management activity the expenditure is associated with, to enable better assessment of the strategies. Categories: Maintenance activities Renewal/rehabilitation activities Replacement activities Disposal activities Expansion activities 16 Increase Repair and Replacement Reserve fund contribution by inflation percentage each year. 17 Increase Repair and Replacement Reserve fund contribution by growth percentage each year. 18 Update Capital Sustainability Strategy to plan for long-term financial sustainability of tax-rate assets considering the following: Designating a portion of Gas Tax revenue to reduce the Repair and Replacement Reserve fund revenue need as part of the Capital Budget Strategy. Extending the end of life of assets through improved asset management to reduce the annual Repair and Replacement Reserve fund demand. Attracting alternative funding through partnerships and grants. Increasing the Capital Sustainability Levy Expand the Asset Management Plan An objective is to have all assets owned and managed by Richmond Hill included in the asset management plan. Key actions for integrating an asset type into the asset management framework and plan are: Assemble baseline data Develop business processes for condition assessment of the asset Identify necessary tools and other resources needed Create a workplan for ongoing data collection and analysis Create necessary links to financial planning strategies Action 19 Develop a work plan to incorporate and expand the asset management plan to include additional assets such as entrance features and trees in parks. Short Term Medium Term Long Term 129

132 Improve Tools and Resources The Richmond Hill Asset Management Framework highlights the tools and processes currently used for asset management. Through the creation of the Asset Management Plan it was found that existing tools and staffing do not allow for adequate administration and analysis of the Town s assets and asset management processes. Improved or new tools are needed in the future, and additional staff will likely be needed to move this new asset management capacity forward. Action Short Term Medium Term Long Term 20 Create a business case for staffing to maintain the asset management plan and manage the workload associated with implementing the asset management plan recommendations. 21 Investigate a software solution to convert the Tangible Capital Asset (TCA) inventory into an asset database. 22 Investigate tools and software that enable options analysis of maintenance, repair, rehabilitation and end of life opportunities for different classes of infrastructure. Richmond Hill Municipal Offices 130