Asset Management
Council is the custodian of infrastructure assets with a replacement value of approximately $455M. The assets are consumed on average by $6.4M each year (based on current best available asset data). Council has determined the “Cost to Bring to Satisfactory” based on the Long Term Financial Plan (LTFP) requirement to develop a 10 year capital works program which has resulted in a target infrastructure expenditure of $7.18M. This leaves a renewal gap of $1.31M in the 09/10 financial year.
The renewal gap has decreased from $1.9M in 08/09 as Council in response to the community concerns for improved Infrastructure, has injected an additional funding of $700,000 in the 2009/10 financial year into Infrastructure works. This includes an additional budget of $450,000 for Road Resheeting and $250,000 for Footpath improvements.
In preparing detailed 10 year capital works programs for Council’s Long Term Financial Plan Council has prepared a 10 year forward maintenance works program for Seawalls and Marine Structures. Detailed Buildings inspections and production of a 10 year forward maintenance works program for buildings has also commenced.
Bridges have recently been surveyed and their condition assessed. They will be revalued under Fair Value requirements and a 10 year forward maintenance works program for bridges has been developed.
Footpaths and Roads pavements revaluation will be undertaken in 2009/10 under the Fair Value requirements. A 10 year forward maintenance works program has been prepared for both infrastructure categories.
Council is nearing completion of a Flood Study which will assist in validating the capacity of the stormwater drainage assets. Council is continuing to undertake an extensive CCTV survey of the stormwater drainage assets to evaluate the condition of the pipelines, with the main focus initially on those located under private property, and is continuing with its prioritised pipeline rehabilitation program which has formed the basis of the initial 10 year forward maintenance works program.
Leichhardt Council, in conjunction with Jeff Roorda & Associates (JRA), is currently preparing a Long Term Financial Plan due for completion in 2010. This plan will incorporate modelling of the following three scenarios for the funding of infrastructure:
- Scenario 1 – Ideal - Infrastructure provision where no funding constraints exist
- Scenario 2 – Infrastructure provision for current funding levels
- Scenario 3 – recommended Infrastructure provision strategy
The modelling compares the value of what is due for renewal in the next 10 years to the current funding levels to establish long term infrastructure renewal targets and sustainability ratios. Council’s approach to asset management looks at maintaining and updating the best available data and developing a 10 year program taking into consideration risk, location, environmental factors, future needs and demand. This 10 year program for each major infrastructure category will then feed into Council’s long term financial plan which intends to meet the infrastructure renewal gap and where this is not possible it will identify the consequences and risks to Council.
It is important to note that with Council’s new infrastructure assets growing annually through the construction of new cycle ways, pathways, park embellishments, traffic facilities and the acquisition of new open space that the additional annual funding requirements to maintain these assets must be recognised in Council’s asset renewal programs. In addition the expenditure on creating additional assets (Asset Expansion) does not contribute to meeting the Target Expenditure required for the ongoing maintenance and renewal of the existing assets.
Annual Report Under Section 428 (2) (d) of Local Government Act (Special Schedule 7)
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Report Group:
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Cost to Bring To Satisfactory LTFP
Average (Ren Required + Mce + Operating):
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Cost to Maintain at Satisfactory LTFP
Average (Mce + Operating):
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Councils Programme
(LTFP average Budget Ren + Oper + Mce):
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Sustainability Ratio: |
Renewal Budget LTFP |
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Bridge
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$18,675.50
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$0.00
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$0.00
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0 |
$0.00
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Buildings
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$2,192,470.00
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$280,000.00 |
$1,362,000.00 |
0.62 |
$1,082,000.00 |
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Footpaths
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$2,140,500.00 |
$105,000.00 |
$2,140,500.00 |
1.00 |
$2,035,500.00 |
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Kerb
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$672,179.63 |
$0.00 |
$381,000.00 |
0.57 |
$381,000.00 |
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Road Pavement
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$1,130,189.53 |
$105,000.00 |
$1,050,000.00 |
0.93 |
$945,000.00 |
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Seawalls
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$354,000.00 |
$0.00 |
$262,000.00 |
0.74 |
$262,000.00 |
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Stormwater Civil
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$600,000.00 |
$65,000.00 |
$515,000.00 |
0.86 |
$450,000.00 |
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Wharves
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$72,000.00 |
$5,000.00 |
$20,000.00 |
0.28 |
$15,000.00 |
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$7,180,014.66
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$560,000.00
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$5,730,500.00
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0.80
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The sustainability ratio presented above indicates that over a 10 year planning horizon Council currently funds 80% of its asset renewal needs. It should be noted that the figures in the above schedule do not represent the “backlog” of required works.
Leichhardt Council’s Asset Management Strategy and Policy adopted in June 2009 (see link to the Council report below) has taken into consideration all of the above factors to outline the way forward. A corporate Asset Management Steering Group has been formed and given the charter of implementing, monitoring and reporting to the Senior Management Team on the development of Asset Management at Leichhardt Council.
Click on the links below for addtional information;
Asset Management Policy (25.17kB)
Asset Management Strategy Attachment (1.33MB)