SUMMARY DOCUMENT Building Asset …...preparing similar asset management plans around Australia. By...

Building Asset Management Plan

SUMMARY DOCUMENT

June 2009

1

Background Why have a plan?

Knox City Council has a responsibility and obligation to the community to:

• Provide quality services efficiently, effectively and sustainably;

• Act responsibly and ethically in all that it does; and

• Manage all Council assets appropriately and act to ensure the safety of the community and workers who use these assets.

These obligations apply to the 270 buildings which Council uses, owns, or operates.

Council buildings are critical for local communities like Knox. They support the delivery of community services; act as focal points for community life; and contribute to the social, cultural and economic development of the local community.

Knox City Council must take a strategic approach to managing its building asset portfolio if it is to meet community needs and protect the quality of life enjoyed by the community now and into the future.

Australian first

The Building Asset Management Plan (BAMP) outlines that strategic approach. It is the first time an Australian Council has created a completely holistic approach to managing its buildings – one which considers building performance in the context of demand for Council services.

As well as examining the performance of Council buildings, the plan documents and assesses how Council currently handles building management practices, budgets and service standards, and recommends improvement projects that will balance customer expectations, lifecycle costs and risk management for many years to come. It has the potential to become the benchmark for Councils preparing similar asset management plans around Australia.

By implementing the plan, Council will demonstrate its duty of care to users of its buildings, and work towards best practice in building asset management.

How did we get here?

The development of this plan was guided by the Municipal Association of Victoria’s (MAV) STEP Program and best practice guidelines set out in the MAV’s Building Asset Management Plan Framework (2006) and

Broadened STEP Program (2008), and the Institute of Public Works Engineering Australia’s (IPWEA)

International Infrastructure Management Manual (2006).

Each of these documents advocates a holistic approach to managing building assets, and encourages Councils to:

• Engage with the community to understand and define service expectations;

• Review services to make sure they are in line with community needs and expectations;

• Develop service delivery targets so performance can be assessed;

• Estimate costs associated with delivery of various service scenarios; and

• Develop an ‘asset rating system’ to help the community understand the level of service and costs involved in asset provision.

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How does this plan fit with other Council priorities?

When implemented, this plan will contribute to a number of objectives as outlined in Knox Vision 2025.

Sustainable Communities:

• Healthy, connected communities: To increase community health and connection by supporting participation in community life;

• Culturally rich and active communities: To improve opportunities for community members to participate in a vibrant community life;

• Dynamic services and facilities: To provide and facilitate a range of high quality, accessible facilities and services that meet contemporary needs;

• Sustainable natural environment: To make progress towards being a national leader in environmental sustainability; and

• Balanced quality urban development: To further develop the natural and built environment to enhance liveability.

Sustainable Organisation

• Innovation and excellence: To strive toward excellence through services reviews, process improvement and innovation;

• Effective governance: To conduct ourselves in an open, honest and accountable way and ensure all activities promote good governance

• Stewardship of finances and assets; to manage our assets and financial resources on behalf of the community in a responsible and sustainable manner; and

• Social and environmental responsibility; to incorporate the impacts of social, environmental and economic perspectives into our decisions.

The BAMP also contributes to the Knox People and Organisation Excellence Strategy (2007–10), which aims to build on Council’s ability to work as one team with one focus. It includes an assessment of how Council’s internal operating environment affects service and building management outcomes.

What will happen next?

The BAMP includes a detailed implementation plan, including recommending a large number of specific projects (which are summarised at the end of this document).

The recommended projects will be considered during Council’s budgeting process, and staff and resources allocated according to the budget as adopted by Council. In addition to the operational funding required, investment in the Capital Works Program will also ensure the desired renewal and upgrade levels are met and Council is in a position where it can sustainably manage its building network.

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About the building asset management plan How was this plan created?

With Council’s Strategic Asset Management Plan 2003-2013 as a starting point, development of this plan involved creating a reference group with representatives from every Council department that uses or manages Council buildings.

This reference group was critical, because decisions made by staff across the organisation affect the performance of Council buildings. The group also allowed a common understanding of building performance in the context of community and user demand to be developed.

The following tasks were then undertaken in consultation with the reference group:

• The development of a hierarchy of buildings that could support the prioritisation of asset management decisions;

• A definition of services provided in Council buildings;

• The development and testing of customer service level expectations;

• Analysis of current and future service demand;

• The development of a service delivery model, which could be used to analyse Council’s services and asset lifecycle management approach; and

• The identification of gaps in Council’s current management approach.

What does this plan consider?

This plan considers every building asset for which Council has a responsibility (see the definition of a building asset in the box on page six) in the Knox municipality, and fits them into a hierarchy (see page nine).

The plan also assesses how Council manages its building portfolio as a whole, by asking five key questions:

• Are risks and liabilities associated with building and service management understood and appropriately managed?

• Are demands on services, including community expectations, understood and linked with management performance targets?

• Are data and knowledge management processes, standards and systems able to support decisions that take into account both the physical management of the building, and its use?

• Have the costs involved with different service level scenarios been evaluated, to ensure that the best balance has been achieved?

• Are the relevant people from across the organisation being involved in making decisions and undertaking activities that impact Council building performance?

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What other factors impact Council’s management of building assets?

Part of the process of good building asset management involves understanding, influencing and responding to changes in the environment. As part of the development of this plan, Council has taken into account a number of external factors including the:

• Natural environment;

• Built environment;

• Social and cultural environment;

• Economic and cultural environment; and

• Legal and political environment.

Particular challenges in each of these areas have been considered and, where necessary, projects to improve Council’s performance have been recommended. These are included in a summary at the end of this document.

What difference will this plan make?

The plan, if supported, aims to improve the performance of Council buildings so that:

• Council buildings will be fit for their current use and managed in a way that optimises performance and meets community expectations;

• Services are not restricted by building maintenance issues;

• Physical impediments to accessibility are minimised;

• Buildings comply with relevant regulations;

• Energy and water use is minimised; and

• The health (natural ventilation and lighting) of buildings is improved.

The plan aims to better balance and meet community expectations by ensuring the

Council:

• Engages with the community and keeps people informed of decisions;

• Investigates customer service expectations and translates them into measurable service and asset performance targets;

• Makes decisions based on comprehensive analysis of the operating environment and service demand; and

• Regularly reviews and adjusts services so that they stay in line with community expectations.

The plan aims to better integrate the lifecycle management of buildings and services they support by:

• Providing for consistent reviews for all services;

• Clearly defining desired outcomes for all services provided in Council buildings;

• Making sure Council strategy, structure, systems, standards, skill sets and performance metrics make it possible to deliver desired service outcomes;

• Identifying building and service management accountabilities and responsibilities;

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• Facilitating the development of policies that guide and prioritise asset creation, renewal, upgrade, maintenance and disposal; and

• Putting in place service agreements for all services provided in Council buildings, which include:

o Service objectives that match customer expectations;

o Time and quality standards for maintaining, renewing and upgrading building components; and

o Internal communication standards.

The plan aims to improve the collection, management and use of data and knowledge by ensuring that:

• All building asset data (including valuations, occupancy agreements, maintenance, renewal, upgrade, disposal, usage and demand data) is recorded systematically and linked, where appropriate, with records stored in Council’s asset management system;

• Council’s asset management system is used to support proactive management and monitoring of building inspections, repairs, renewals and upgrades;

• Staff understand the importance of quality data management; and

• Standards and procedures are developed to share knowledge across the organisation.

The plan aims to boost performance measurement by implementing:

• Measurable performance indicators for all Council services and building assets;

• Corporate monitoring and reporting tools to evaluate and adjust service and asset performance; and

• Tools and processes to guide implementation.

The plan aims to manage risk and compliance issues more effectively by:

• Guiding staff to understand liabilities associated with ownership and use of property;

• Ensuring processes are in place to ensure buildings are managed in a manner that ensures compliance with relevant regulations;

• Better managing Council sites to minimise public safety risks and insurance premiums; and

• Confirming that occupancy agreements are in place for all properties and are reviewed and maintained systematically.

The plan aims to enhance the long-term sustainability of Council buildings by ensuring

that:

• Service reviews consider the whole service and building portfolio;

• Building assets are preserved for the benefit of current and future generations;

• Funding requirements are based on a consistent, star-rating system that measures the accessibility, availability, regulatory compliance, fitness for purpose and environmental sustainability of Council buildings;

• Lifecycle cost implications of all investment decisions are considered by all decision makers; and

• Impacts of climate change are considered and managed across the service and asset lifecycle.

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What assets are in this plan? What is a building asset?

This plan considers two classes of assets: Council buildings, and their associated minor assets.

Council buildings are structures on land owned or occupied by Council, which:

• Have a roof and walls connected to form an enclosed, or partly enclosed, space;

• Are primarily above ground and permanently fixed to a site; and

• Are designed and intended to be used for the shelter or enclosure of persons, animals and/or property.

Each building will include a number of components — from blinds and awnings to walls and windows. As in most Council areas, the building portfolio of Knox City Council reflects both its current services, and its history: with a mix of new assets and those constructed generations ago. Some buildings are showing signs of age, and others are impacted by changing demand and usage patterns.

Fixed minor assets include:

• Shelters (including gazebos, shade sails, covered play areas);

• Retaining walls over 500 mm;

• Site furniture (including bike racks, bins, lights, seats, tables, flagpoles, planter boxes);

• Fencing (including gates);

• Drainage pits;

• Footpaths ; and

• Playground equipment.

Fixed minor assets in active open space reserves (such as sports ovals) — including shelters, sports playing surfaces, fences, and goal posts — are not in the scope of this plan. The forthcoming Open Space Asset Management Plan will address these assets.

What building assets are Council responsible for?

Council has some responsibility for 270 buildings in the Knox municipality. That includes sites where Council is the land owner, the building owner or the building occupant – or any combination of the three.

Council is liable for any safety issues or injuries to anyone on a Council-owned or occupied site — including some liability for 29 buildings constructed on Council-owned land by other people.

Where Council is the occupant and owner of both the land and the buildings, it takes responsibility for the management of all aspects of a site. It also takes responsibility for all aspects of 17 sites where Council has built on land owned by other people.

Occupancy agreements define Council’s management responsibilities where a building is occupied by someone else. However, there are 104 Council-owned buildings occupied by others that are not included on Council’s register of occupancy agreements. Missing occupancy agreements and a lack of understanding of ownership obligations represents a considerable risk to Council which could possibly have legal implications.

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What are these assets worth?

In 2006/07, the current replacement value of Council’s building portfolio was valued at $140.5M, with a written down value of $82.7M. However, this value only includes 231 buildings — the remaining 39 buildings are awaiting assessment as to the appropriateness of their inclusion into Council’s balance sheet or they are buildings not owned by Council.

How old are the building assets?

The buildings owned by Council, or built on Council land, range in age from two to 128 years. The average age is 37 years. Around 12 per cent of Council buildings have an estimated remaining life of five years, and eight have an estimated remaining life of two years. This suggests an urgent need to review the potential impact on Council services if these buildings are not refurbished in the short term.

19 buildings owned by Council are either vacant, used less than once a fortnight, or have no identified current or future strategic use.

Reviews conducted as part of the development of this plan also highlighted a need to increase building renewal expenditure to keep pace with the rate at which assets are deteriorating, as well as clear any backlog of outstanding repairs, and rejuvenate tired assets.

The building hierarchy outlined below, and the star-rating system (see box, page 14) will be two of the key tools used to determine the priority of improvements.

What about managing the sites on which building assets sit?

Site management is a key part of managing Council buildings. Three audits, conducted in 2007 and 2008, provide a snapshot of Council’s performance in managing sites.

Minor asset condition audit

The condition of minor assets (see definition in the box on page six) at 76 Council properties was assessed in 2007 and 2008. A further 24 sites are yet to receive an audit of minor asset conditions. This audit also allowed Council to create its first comprehensive register of the minor assets it is responsible for.

Only 3.2 per cent of minor assets at the 76 properties assessed were found to be in poor or failed condition. The audit also identified minor assets that will need to be replaced within 12 months, and estimated the replacement cost at $42,900.

One of the improvement projects recommended by this plan involves repeating the minor asset condition audit once every five years, using the same data collection and recording method for benchmarking.

Insurance audit findings

Council’s insurers, Jardine, Lloyd and Thompson (JLT) undertake an annual audit of Council policies, processes and practices to assess how effectively Council manages risk. This audit, which includes recommendations to improve performance, focuses on:

• Accountabilities and awareness;

• Inspections and design risk assessment;

• Incident response and prevention; and

• Business continuity management.

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Council’s ability to demonstrate that it has good systems and practices to reduce and manage risk has the potential to reduce the premiums it pays to JLT.

The most recent audit, conducted in 2007/08, involved a desktop audit of Council policies and procedures and visits to three Council buildings. Council achieved an overall rating of Bronze, with a score of 77.67 per cent.

JLT provided 22 recommendations for improvement, which have been included among the improvement projects recommended as part of this plan. Most of JLT’s recommendations relate to the management of risk on construction sites, and undertaking proactive inspections of Council properties, with a focus on:

• Trees;

• Building security;

• Appearance and impact on neighbours;

• Heritage status;

• Standards of materials and construction;

• Asbestos exposure;

• Drainage;

• Use of electrical appliances;

• Storage of combustible materials;

• Potential for arson; and

• Quality of record keeping and traceability.

Site soil screening assessment findings

In 2007, site screening assessments were conducted at all Council licensed child care premises, at the direction of the Department of Human Services (DHS). Each of the seven sites investigated were given a clean bill of health. Eleven medium risk sites will be assessed for site screening in 2009, and further investigation into 18 low-risk sites will be completed by 2010.

Categorising building assets Building hierarchy

As part of the development of this plan, all Council buildings have been classified into a four-level hierarchy. Buildings in all hierarchy levels are important to service delivery and must meet all regulatory compliance requirements as well as the community’s minimum acceptable standards. The hierarchy is one of a number of factors that will inform Council’s decisions about the management of a building through its lifecycle.

The hierarchy’s four levels are represented in the table below and are based on scores arising from the following criteria:

• Expected building replacement cost (based on 2006 revaluation by Finance Dept);

• Known historical or Aboriginal significance (based on Knox Heritage Study 1993 and subsequent work by City Strategy Dept);

• Current building occupancy;

• Service-related legislative framework that imposes restrictions on building management requirements, excluding standards applicable to all buildings eg. DDA, BCA, OH&S;

• Building use (number of days/year);

• Building’s support of a key revenue generating service (for Council or others) and the level of revenue involved;

• Number of community services the building currently supports;

• Availability of alternative buildings (within the municipality) for temporary retention of service delivery — if building must be closed or accessibility reduced for one month; and

• Impact of building closure or building availability restrictions for one month.

Hierarchy Score Range Comments

Level 1

100-76

6 in Knox, including:

three owned and occupied by Council; and

three owned by Council and occupied by others.

Level 2 75 -51


45 owned and occupied by Council;

87 where the land and/or building is owned by Council and occupied by others

4 where the land and building is owned by others and occupied by Council

Level 3 50-26




4 where the land is owned by others, and the building is owned and occupied by Council

1 where the land and building is owned and occupied by others

Level 4 25 - 0




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Integrating building and service management What services are currently provided from Council buildings?

Communities rely on services that are provided from Council buildings — and the community’s perception of a building can influence its perception of the service provided from that building. Currently, 26 service types across nine departments are provided from Council’s 270 buildings, as outlined in the table below.

Service Service Objective No. Buildings

Family & Children Services

Maternal and Child Health Care

Provide free education, promotion, information, guidance and support concerning the health and development of children (0-6 years) and their carers/ families through specialised programs and confidential consultations. Universal public health service — all families in Knox with babies are offered this service.

13

Preschool Provide a preschool program for 4 year-olds in which each child is given the opportunity for a broad and rounded experience in all areas of learning and development, including social, emotional, motor, cognitive and creative skills.

37

Family Childcare Network

Provide a healthy, stable and caring environment within a central facility for children between the ages of 0-6 years whose parents work, study or who are deemed at risk of serious abuse or neglect or who require care for respite reasons.

6

Early Intervention

Provide support for children with additional needs and vulnerable families.

Provision of assistance for parents in promoting their children’s learning and development.

2

Playgroups Provide parents/ carers and their children an opportunity to socialise and supports those most vulnerable to achieve these aims.

14

Community Wellbeing

Community Meeting Space

Provide affordable community facilities for the purpose of meeting cultural, leisure, social, community support activities and the conduct and participation in passive or active recreation.

10

Community Support

Provide individuals and families with support and care through the provision of counselling, material aid, emergency relief, volunteers, information exchange and referral, financial counselling and mental health services

9

Community Education

Contribute to education and lifelong learning by providing access to learning opportunities

9

Emergency Services

Build support for a safe community through the provision of dedicated emergency services for the Knox Community, including funding, facilities and land

4

Healthy Ageing

Residential & Respite Care

Permanent supported residential care for frail older residents who are unable to live independently in the community including residents with special needs or dementia.

Short term residential respite to provide families or carers a break from ongoing caring responsibilities.

2

Food Distribution

Provide clients with a range of nutritionally-balanced meals necessary to maintain a healthy lifestyle.

1

Social Activity Support (Seniors)

Promote inclusiveness and participation and maximise recreation, leisure, education and cultural opportunities for older residents. Provide safe, convenient and comfortable facilities that support a range of recreational activities.

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Service Service Objective No. Buildings

Youth, Leisure & Cultural Services

Aquatics Provide an aquatic facility that attracts, supports and facilitates a range of fitness, education and leisure activities

6

Structured Sport

Provide facilities to attract, support and facilitate quality sporting (and social) outcomes for all sporting clubs.

Support effective functioning of sporting clubs in delivering their service.

(Team/club competitions are governed by rules and regulations of a recognised peak sporting body)

89

Structured Recreation

Provide facilities to attract, support and facilitate Knox resident participation in structured recreation (e.g. activity occurs as a class).

24

Youth Support Promote, develop and encourage the physical, social, mental and spiritual wellbeing of young people through providing, facilitating, planning, funding and advocating the identified needs and issues of young people, their families and the community.

3

Library Provide a repository of information resources for reading, study or reference that can be borrowed by the public for use outside the facility. Resources include books, Internet, maps, prints, periodicals, newspapers, artworks on various media, such as print, CD, DVD, microfilm etc.

Provide professional research assistance, PCs for word processing, photocopiers, and faxing.

Provide programs of guest speakers, displays, book discussion clubs, new book days, participation in local festivals

5

Heritage Education

Enhance community education and appreciation of Knox history by providing access to sites of historical significance

10

Performing & Visual Arts

Support visual and performing arts including ceramics, crafts, music, dance, multimedia productions and theatre by professional and local performers and artists.

Provide for a range of performing arts programs and other cultural activities.

3

Governance

Customer Service

Provide a 'one stop shop' service environment for customers that choose to make enquiries (and/or payments) in person, on the telephone or via the Internet.

2

Council Business

Operation of the Knox Civic Centre and support to all Council service 10

City Strategy

Heritage Protection & Enhancement

Ensure Knox history is preserved for current and future communities. 4

Sustainability

Public Art Support the creation of public artworks to beautify properties and Council-owned public open space

2

Operations

Toilets Support the use of public open space areas, commercial centres and community facilities through the provision of convenient facilities that meet the community's sanitary and hygiene needs.

19

Maintenance & Operations

Monitor, maintain, upgrade, renew and dispose of Council assets to ensure compliance with relevant legislation and provide presentable, operable, safe and reliable assets that support the delivery of Council business and community services

14

Engineering Services

Waste Disposal, Recycling & Management

Manage the disposal and recycling of waste within the municipality 2

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What is the relationship between Council services and Council building assets?

Managing building assets involves more than just the physical components of a building. Thought must be given to how a building can meet a community’s need or desire for services. The BAMP introduces a Service Delivery Model to illustrate the link between service and asset provision.

The model demonstrates that community demand informs the need for a service, which in turn creates an asset requirement to support the service provision. The phases described in the table below do not necessarily occur in parallel but must be managed in an integrated way over the lifecycle of the service and asset.

Service Lifecycle Phase Building Lifecycle Phase

Formulation Broadly define all requirements to enable service delivery. Translate detailed service requirements into physical asset needs and measurable service standards and targets.

Pre-Establishment

Design organisation structure, systems, standards, skill sets, and performance measures required for operation and monitoring of the service.

Design Prepare requisite documentation to ensure delivered assets will meet service needs, match expected service life and be able to be created, maintained and renewed in a sustainable manner.

Establishment Set up operating structure, systems, standards, resources and performance measures required to enable operation and monitoring of the service.

Communicate service delivery objectives to all stakeholders.

Creation Ensure assets constructed, purchased, or leased fit with service needs within physical and financial constraints

Operation Operate and monitor delivery of the service to sustainably meet community needs.

Maintenance Preserve assets to ensure they meet service expectations, mitigate risks and achieve expected asset life

Adjustment Determine whether the service is aligned with community expectations and the operating environment.

Identify service and asset adjustments required to ensure service objectives are met.

Adjust internal service agreements, organisation structure, systems, resources and performance measures to ensure service objectives can be monitored and met.

Communicate adjustments to affected parties

Renewal Replace assets in a timely manner to ensure the asset does not fail and disrupt service provision.

Discontinuation Ensure Council has a considered approach to the termination of services no longer required in a manner that minimises community disruption

Disposal Ensure assets that have no current (or foreseeable future use) are removed from Council’s asset portfolio.

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What future demand for services provided from Council buildings is expected?

Council does not have a comprehensive understanding of community demand for services provided in Council buildings. Projects to build new assets or upgrade buildings have historically been identified as part of other projects — for example, reviews of child care services.

There is an identified need for Council to undertake service planning and demand analysis to understand service needs into the future.

It is a recommendation from this plan that Council officers consider the need for the asset in the first instance and then explore the feasibility of alternative asset provision options (for example, lease) to service the identified demand.

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Community expectations of building assets How does Council measure community satisfaction with buildings?

Different groups in the community have very different expectations of Council’s building assets. These expectations are often strongly connected with a person’s expectations of the services they receive in a particular building.

Nonetheless, it is important that Council understand the expectations of different groups, so that it is able to balance and meet them. At present, Council does not systematically record customer feedback about Council buildings — which makes it difficult to assess customer satisfaction.

Where information has been recorded, through independent surveys like Auspoll and the Local Government Community Satisfaction Survey, it has tended to focus on satisfaction with recreational facilities, halls and toilets. Recent surveys reveal concerns about the inadequacy of transport in the area, and sporting and other facilities for young people. Satisfaction with buildings that support other services has not been measured.

Focus groups with a range of people who use Council buildings, or services offered in Council buildings, were held as part of the creation of this plan. These groups centred on feedback about buildings used by three departments: Family and Children’s Services, Community Wellbeing, and Healthy Ageing.

The feedback received focused on two main areas where improvements could be made:

• physical aspects or components of buildings — such as replacing hot water units, conducting pest inspections and improving signage; and

• administration and management of the use of the buildings — such as balancing the access needs of different users; reducing the cost of access for community groups conducting fundraising, and clarifying the responsibilities of the building owners and occupiers.

Many of the suggestions received through the focus groups have been included in the recommended improvement projects summarised at the end of this document.

What is the star rating system?

Data collected through a building audit in 2007/08, and feedback from the focus groups, has been used to develop a star rating system. The system measures performance against five Core Values that summarise community expectations of Council buildings.

The star rating system will make it simpler for people within Council and in the community to understand building performance. It will also make it easier to demonstrate the effect of changes to existing funding levels. Used as an internal tool to measure building performance against community expectations, ratings will be used to guide future building investment decisions.

The five Core Values included in the star rating system are:

• Access and Inclusion — or how accessible and connected the building is;

• Availability — or how easily the building can be used for alternate purposes, and whether building issues limit use;

• Compliance — or how well the building conforms to the current Building Code of Australia;

• Fitness for Purpose — or how suitable the building layout, fittings and condition are for current use; and

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• Sustainability — or how much the water and energy the building uses and the health of the building (ventilation and natural light).

Each building is given a rating from zero (lowest) to five (highest) against each value. A five-star rating does not mean that the building is in pristine condition with state-of-the-art fitout. Instead it implies the building has no physical barriers to access, no recent building issues, no known non-compliances with the Building Code of Australia, and no recent insurance claims. It matches community expectations around location, functionality, appearance and comfort. It has good natural ventilation and lighting, energy and water efficient fittings.

How is the building portfolio performing against the star rating system?

Current performance against the five Core Values is outlined below with notes on current data limitations.

Core Value Average Star Rating

Data Limitations

Accessibility Good – 3.5 95.9 per cent of buildings were assessed against the Building Code of Australia (2007) Part D3 only. 26.3 per cent received a detailed accessibility audit. 4.1 per cent were not audited.

Availability Very Good - 4

Building utilisation and service disruption data is not systematically collected. Assessment relied on incomplete maintenance data and anecdotal evidence.

Compliance Poor - 2 90 per cent of buildings were assessed by visual inspection only. Performance against provisions that could not be assessed visually (eg. fire resistance, structural integrity) were not evaluated.

Fitness for Purpose

Very Good - 4

In the absence of clear definition of features that make a building fit for purpose, this appraisal relied on: Auditor assessment of building functionality (85.6 per cent), and condition (97.4 per cent) supplemented by break-in and insurance claims history, review of building location and comparison of building floor plans against desirable room types and sizes.

Sustainability Good – 3.5 Energy and water efficiency was assessed for 88.3 per cent of Council buildings.

Average Overall Rating Good – 3.4

Addressing data limitations will result in more accurate performance measurement. Accessibility, availability and fitness for purpose star ratings are likely to change as more data is collected and fitness for purpose requirements are better defined.

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Planning for better building asset management What is Council’s current approach to service and asset delivery?

Council’s limited understanding of future service needs is a reflection of its current approach. Historically, services reviews have tended to recommend the creation of new buildings or modification of existing buildings, without reviewing:

• The service’s recent performance;

• The need for the service in the context of services provided by Council and others;

• The service’s relevance in terms of current and future community needs and expectations; or

• Building network utilisation.

The following gaps have been identified within the plan:

• Horizon scanning — a way of understanding Council’s operating environment. It includes review of information regarding the internal and external environment

• Service feasibility analysis — builds on horizon scanning information to determine an appropriate role for Council to meet community service needs

• Asset option analysis — allows assessment of alternatives if a feasible service requires use of an asset.

How can Council improve its approach to service and asset provision?

Recognising the importance of understanding changes in the operating environment, Council recently established a team dedicated to Community Planning and Development. It has also undertaken a project to update the Community Infrastructure Survey database to improve Council’s horizon scanning data.

These two initiatives have already enhanced Council’s approach to service and asset delivery — and there are further opportunities for improvement.

As part of the creation of this plan, a Service Delivery Model has been developed, in consultation with managers across the organisation. The model describes key objectives, outputs and tasks considered to represent best practice in service delivery. It also identifies key integration functions.

This model acknowledges that management of a building’s lifecycle must be carefully linked with management of the lifecycle of the services it supports (see the table detailing the relationship between Council services and Council building assets on page 12 for more detail).

How will this approach support the financial sustainability of Knox City Council?

Council has a responsibility to make sure that all Council buildings remain safe and functional, at the same time as delivering financial sustainability across its asset base.

Implementation of the improvement projects recommended in this plan will be critical for the sustainable delivery of improved building and service outcomes. It will better support sustainable financial decisions that offer a balance between new assets, upgrades, renewal, maintenance and operations.

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As part of the development of the plan, a predictive financial model demonstrating three different funding scenarios and their effect on Council’s performance against the star rating system over 20 years was created. The scenarios modelled involved:

• Continuing funding for building asset management at current levels;

• Increasing funding for building asset management to the lowest sustainable level; and

• Increasing funding for building asset management to improve performance to the highest level as measured by the Star Rating Model.

Outcomes from this scenario modelling for the first five years are summarised in the table below.

Funding ($’000)

2008/09 2009/10 2010/11 2011/12 2012/13

Low (includes allowance for inflation for all works): New & Upgrade Programs in 5-year Capital Works program do not proceed. Investment to focus on process improvement, risk mitigation and compliance with building codes.

Upgrade $2,181 $677 $697 $0 $0

Renewal $1,549 $1,665 $1,865 $2,064 $2,292

Operation $0 $404 $416 $426 $608

Maintenance $2,882 $2,971 $3,156 $3,247 $3,345

Total $6,612 $5,717 $6,134 $5,737 $6,245

Status Quo (includes allowance for inflation for maintenance works only): As per 5-year Capital Works program and 2008-2020 Visionary Program.

Upgrade $2,181 $1,320 $1,282 $971 $1,180

Renewal $1,549 $1,400 $1,400 $1,400 $1,400

Operation $0 $0 $0 $0 $0

Maintenance $2,882 $2,968 $3,057 $3,149 $3,243

Total $6,612 $5,688 $5,739 $5,520 $5,823

High (includes allowance for inflation for all works)

Adoption of all improvement projects recommended in this plan, active investment to improve ratings across all five values.

Upgrade (Discr) $1,981 $1,360 $4,673 $4,922 $5,070

Upgrade (Non-Discr)

$200 $677 $697 $0 $0

Renewal $1,549 $1,742 $1,945 $2,146 $2,377

Operation $0 $558 $575 $426 $608

Maintenance $2,882 $2,971 $3,810 $3,921 $4,039

Total $6,612 $7,308 $11,700 $11,415 $12,094

The ’Status Quo’ scenario represents Council’s current funding commitment as documented in the Long Term Financial Strategy. Within this option, maintenance has been allowed for, with 3% annual increases to recognise inflation.

The ‘Low’ option includes funding to remove all building code non-compliances (upgrades) and conditions 4 and 5 components (renewals). This scenario also provides operational and maintenance funding to introduce a new inspection program. This will ensure compliance with new building regulations and manage public safety risks.

The ‘High’ alternative, like the ‘Low’ option, allows for the removal of all building code non-compliances and conditions 4 and 5 components. It also has provision to improve the fitness for purpose of buildings, ventilation, natural light and water and energy efficient appliances. Operational and

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maintenance funding is provided to instigate a proactive inspection program to comply with new Building Regulations and 5-yearly audits to monitor condition.

The forecasted average (total – 270 buildings) star ratings for the funding scenarios over the 20-year period are detailed as below.

IMPACT OF FUNDING SCENARIOS BETWEEN 2008 AND 2028

Scenario One –

status quo

Scenario Two –

low funding level

Scenario Three –

high funding level

Access and Inclusion

Rise from current average rating of 3.5 to average rating of 4.

No change from current average rating of 3.5.

Rise from current average rating of 3.5 to average rating of 4.5.

Availability Fall from current average rating of 4 to average rating of 2.

No change from current average rating of 4.

Rise from current average rating of 4 to average rating of 5.

Compliance No change in current average rating of 2.



Fitness for purpose

Fall from current average rating of 4 to average rating of 3.5

No change from current average rating of 4.


Sustainability Rise from current average rating of 3.5 to average rating of 4.

No change from current average rating of 3.5.

Rise from current average rating of 3.5 to average rating of 5.

To achieve the outcomes presented in this plan, a sustained commitment to the provision of adequate funding for compliance with building regulations, service planning, asset renewal, and maintenance is required. Controlled discretionary expenditure on new assets and strategic upgrades is also recommended.

The most sustainable funding level would fall between the low and high scenarios. This funding level would mitigate financial and public safety risk, whilst achieving improvements in terms of building accessibility, availability, compliance, fitness for purpose and environmental sustainability.

It is expected that future demand analysis and improved service planning will inform modifications to the predictive model to ensure expenditure on building management sustainably aligns with service expectations, changing regulations and changing building use.

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Recommendations for improvement projects This plan identifies 77 improvement projects which, if fully implemented, can be expected to:

• Improve risk management and compliance;

• Better integrate service and building lifecycle management;

• Improve service planning (including understanding of service demand);

• Better coordinate building design outcomes that incorporate regulatory compliance, fitness for purpose, environmental sustainability and accessibility improvements;

• Create a strategic approach to improving building connectedness;

• Improve long-term financial sustainability;

• Improve performance management to align decision makers;

• Improve data and knowledge management; and

• Strengthen IT systems (Property Occupancy Register/ Management System and Facilities Maintenance Management System).

Delivering these projects quickly will mean that future expenditure on service and building management can be directed to maximise community benefit. Investment in the implementation of the improvement projects will require funding and resources being made available.

Every Council directorate will have responsibility for delivery of at least one aspect of the plan — and these projects will need to be included in annual business plans.

It is recommended that implementation of improvement projects be driven by the Executive Management Team. Quarterly progress reports should be incorporated into the Executive Management Team’s meeting agenda to ensure sustained momentum during implementation.

Structural recommendations

This plan is critical to the future strategic direction for building asset management and service planning, and has some significant resource implications. It is recommended that the following full time roles be considered to support the plan’s implementation.

Positions created or re-assigned to assist implementing the BAMP are as follows:

• Property Governance Officer (1 EFT);

• Service Planning Manager (1 EFT);

• Service Advocates (3 additional EFT); and

• Facilities Planning Officer (1 EFT)

Council’s Executive needs to decide whether it is currently feasible to increase the existing workforce, and consider how appropriate reporting and accountability structures might be put in place. Recommended roles may be able to be filled by re-assigning existing staff, depending on skill sets and impacts on service delivery.

In addition to the roles proposed above, the plan recommends the projects listed below.

• Establish structure to coordinate management of legal issues relating to property management.

• Establish structure to support integrated service infrastructure planning.

• Increase capacity to comply with obligations imposed by 2006 Building Regulations.

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• Create facilities maintenance officer role to undertake minor building works.

• Establish structure to support consistent horizon scanning coordinated service feasibility asset option analysis.

• Establish integration reference group.

• Assign responsibilities for all lifecycle management phases and integration functions.

• Expand role of the Standards Committee.

• Establish building design review panel.

• Establish working group to define approach to minimise liabilities associated with site management.

Strategic recommendations

The projects below will support improved building and service management; improve Council’s service planning function; create a strategic approach to improving building connectedness and accessibility; and ensure budgets support coordination of building upgrades and renewals and are aligned with delivery and monitoring of building improvements.

• Clarify casual hiring arrangements.

• Review future need for underutilised and ageing buildings.

• Service planning (including understanding and predicting service demand).

• Address the lack of public transport.

• Develop and test customer service levels for all 26 services provided in Council buildings.

• Review parking requirements at Council buildings.

• Develop a program for horizon scanning and service feasibility analysis.

• Develop new buildings upgrades funding approval policy procedures.

• Budget restructure (to align the budget structure with lifecycle phases and core values which will make it easier to track and monitor expenditure on the building stock).

• Develop five year building renewal program.

• Develop five year building upgrade programs for each core value.

• Create non-Discretionary funding allocations to address building compliance issues.

• Review security of buildings subject to multiple breakins.

• Combine review renewal responsibility into review of building maintenance protocols.

• Continue funding soil screening assessments.

Standards and processes

Council currently has a decentralised approach to building asset management. Although the Facilities team is responsible for renewal and maintenance, decision makers across the organisation affect all other lifecycle phases.

These projects will support formal and informal internal communication, to better coordinate and integrate the work of decentralised teams.

• Review of building hierarchy.

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• Reconcile building valuation data.

• Upgrade property occupancy register/ management system.

• Review property occupancy agreements.

• Introduce processes to support enforce Tenancy by community groups of Council buildings policy.

• Review of building maintenance protocols — legal review of responsibilities.

• Monitor vacant underutilised sites.

• Manage the impacts of climate change.

• Develop standards for inclusion of ESD practices in building projects.

• Communicate building maintenance protocols.

• Develop centralised facility booking system and incorporate into property occupancy register/ management system.

• Determine and communicate legal capacity of buildings.

• Standardise the approach to horizon scanning service feasibility asset option analysis.

• Support ongoing collection use of horizon scanning data.

• Develop templates for consistent management of all service asset lifecycle phases.

• Review draft inspection, maintenance renewal service levels.

• Develop technical standards for design, construction, maintenance and renewal activities.

• Develop standardised contract documents for delivery of maintenance, renewal and construction works.

• Develop building handover processes.

• Regular asset register floor plan updates.

• Develop service agreements for all services provided in Council buildings.

• Review building upgrade renewal ranking criteria.

• Upgrade facilities maintenance management system.

• Develop operations manual for facilities management team.

• Implement asset management systems review recommendations.

• Develop standards, specifications and process maps.

• Upgrade facilities maintenance management system — data collection capacity ability to support development of works programs based on audit data.

• Assess and address root cause of recurrent non-compliance issues.

• Revise asbestos management practices.

• Develop building monitoring program (including foundation stability and water penetration).

• Implement Jardine Lloyd Thompson insurance audit recommendations.

• Upgrade facilities maintenance management system to meet insurance auditor expectations.

• Introduction of minor asset design construction standards.

• Complete tasks as identified on corporate risk register to improve management of Council buildings utilised by community groups.

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Metrics and performance measures

Development of the plan has revealed a shortcoming in the metrics Council uses to ensure that people across the organisation who have an impact on building performance are aligned and focused. Investing in more appropriate metrics will improve this alignment.

Clear targets for service and building management performance are required. The star rating model developed to assess the current performance of Council buildings represents a first attempt at measuring building asset management performance. These recommendations will address gaps in existing building performance data and enable assessment of the investment in building and service management into the future.

• Measure building utilisation.

• Measure and manage energy and water usage.

• Translate customer service levels into measurable performance targets for all services.

• Performance measurement reporting.

• Update star ratings report improvements (one year cycle).

• Supplementary building audits to fill data gaps.

• Regular building audits to update star ratings (five year cycle).

• Other audits — compliance.

• Develop fitness for purpose assessment criteria for all services.

• Introduce proactive minor asset audit program.

Skills and capabilities

To effectively deliver service and building improvements, Council staff must have the skills they need to meet their responsibilities. Council has a responsibility to provide appropriate staff training, templates and protocols, which will minimise the risk of decisions inconsistent with Council’s strategic direction or regulatory requirements being made.

These improvement projects are designed to enhance the necessary capacity among Council staff.

• Staff education — legal liabilities of land ownership.

• Staff education — data knowledge management.

• Staff education — understanding the relationship between community needs, services and Council buildings.

• Staff education — use research data to make informed decisions

• Consider lifecycle cost implications of all decisions.

• Staff education — consider sustainability improvements in daily decisions.

• Staff education — understanding horizon scanning, service feasibility asset option analysis.

• Staff education — regulatory requirements.

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What is it going to cost to implement improvement projects for the BAMP?

In order to deliver on the recommendations of the BAMP, it will be necessary to invest in the plan’s implementation. The table below details the estimated cost to embed these improvement opportunities into Council operations.

The risk involved in not implementing these improvement projects has been categorised as either ‘intolerable’ or ‘tolerable’. An intolerable risk is defined as an event that could result in a negative outcome. An example of an intolerable risk is when a property is flooded and water enters the house. Projects with intolerable risks should be given priority.

INTOLERABLE RISKS TOLERABLE RISKS Organisation Dimension

Estimated cost over 20 years

No Projects

Estimated cost over 20 years

No Projects

Estimated total operating cost over 20 years

Structure (Resource Capacity)

Cost included in high and low funding scenario ($480,000)

9 Cost included in high and low funding scenario ($480,000)

1 Cost included in high and low funding scenario ($480,000)

Strategy $995,000 8 $1,570,000 7 $2,565,000

Processes & Standards

$833,000 21 $408,000 13 $1,241,000

Metrics $0 1 $1,814,000 9 $1,814,000

Skills $368,000 5 $344,000 3 $712,000

$2,196,000 $4,136,000 $6,332,000

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Key challenges for Council into the future Key Gaps

• Compliance with Minimum Requirements of the Building Code of Australia (2007)

• Building Component Renewal Rates

• Governance of Property Occupancy

• Service and Facility Planning

Other Gaps

• Integration of Service & Building Lifecycle Management

• Performance Management

• Data & Knowledge Management

• Standards & Processes

• Skills & capabilities

Council buildings are the cornerstone of community support and interaction. These buildings house services that are essential for community wellbeing. Buildings provide a meeting place for the community in the form of halls, community centres, pavilions and libraries and encourage the community to come together. Failure to recognise the value Council buildings have on the fabric of the community may have an immeasurable impact on the wellbeing of Knox and Council’s ability to sustainably manage its buildings.

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