The Asset Management Plan for the County of Bruce Assest...Amadea Setiabudhi Data Analyst...

The Asset Management Plan for the County of Bruce

Annual Funding Available

Annual Funding Deficit

Annual Funding Surplus

State of the Infrastructure Bruce County

AVERAGE ANNUAL FUNDING REQUIRED vs. AVERAGE ANNUAL FUNDING AVAILABLE

$5,397,000

$1,544,000

$1,910,000

$801,000

$0

$784,000

$19,000

$796,000$583,000

-$4,622,000

-$2,637,000

-$1,277,000

-$1,959,000

-$350,000

$117,000

-$66,000

-$752,000

-$351,000

ROAD

NETWORK

SOCIAL

HOUSING

EQUIPMENT,

FURNITURE &

FIXTURES

LAND

IMPROVEMENTS

TRAILS

BUILDINGS

BRIDGES AND

CULVERTS

TECHNOLOGY &

COMMUNICATION

MACHINERY &

VEHICLES

Total Annual Deficit: $11,897,000

PUBLIC SECTOR DIGEST

148 Fullarton Street, Suite 1410

London, Ontario, Canada

N6A 5P3

T: 519.690.2565 F: 519.649.2010

www.publicsectordigest.com

www.citywidesolutions.com

October 2016

Bruce County

30 Park Street

Walkerton, Ontario N0G 2V0

We are pleased to submit the 2016 Asset Management Plan (AMP) for Bruce County. This AMP will serve as a strategic,

tactical, and financial document, ensuring the management of the municipal infrastructure follows sound asset

management practices and principles, while optimizing available resources and establishing desired levels of service.

Given the broad and profound impact of asset management on the community, and the financial & administrative

complexity involved in this ongoing process, we recommend that senior decision-makers from across the organization

are actively involved in its implementation.

The performance of a community’s infrastructure provides the foundation for its economic development,

competitiveness, prosperity, reputation, and the overall quality of life for its residents. As such, we are appreciative of

your decision to entrust us with the strategic direction of its infrastructure and asset management planning, and are

confident that this AMP will serve as a valuable tool.

Sincerely,

The Public Sector Digest Inc.

Matthew Dawe Israr Ahmad

Vice President Managing Editor

[email protected] [email protected]

INTELLIGENCE FOR THE PUBLIC SECTOR.

PUBLIC SECTOR DIGEST

Contacts

Matthew Dawe

Vice President

[email protected]

Israr Ahmad

Managing Editor

[email protected]

Christine Beneteau

Account Manager

[email protected]

Reina Dewachter

Data Analyst

[email protected]

Jona Mema

Data Analyst

[email protected]

Amadea Setiabudhi

Data Analyst

[email protected]

Tyler Sutton

Senior Research Analyst

[email protected]

Matthew Van Dommelen

Regional Director

[email protected]

Gabe Metron

Regional Director

[email protected]

Holly Jennings

Account Manager

[email protected]

LEGAL NOTICE

This report has been prepared by The Public Sector Digest Inc. (“PSD”) in accordance with instructions received from the

Bruce County (the “Client”) and for the sole use of the Client. The content of (and recommendations) this report reflects

the best judgement of PSD personnel based on the information made available to PSD by the Client. Unauthorized use

of this report for any other purpose, or by any third party, without the express written consent of PSD, shall be at such third

party’s sole risk without liability to PSD.

This report is protected by copyright.

INTELLIGENCE FOR THE PUBLIC SECTOR.

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Contents

Executive Summary ..................................................................................................... iv 1. Introduction & Background .................................................................................. 1

1.1 What is Asset Management? ........................................................................... 2 1.2 Asset Management Principles .......................................................................... 2 1.3 Purpose of the AMP ........................................................................................... 3 1.4 Contents of the AMP ......................................................................................... 3 1.5 Developing the Asset Management Plan ...................................................... 4

1.5.1 Context ............................................................................................................. 4 1.5.2 Dataset ............................................................................................................. 4 1.5.3 Amortization ..................................................................................................... 4 1.5.4 Financial Analysis ............................................................................................ 4 1.5.5 Field Inspection Data ..................................................................................... 5 1.5.6 Infrastructure Report Card ............................................................................. 5 1.5.7 Timeframe ........................................................................................................ 7 1.5.8 Limitations ......................................................................................................... 8 1.5.9 Process: Work order and Work flow.............................................................. 9

2. Key Aggregate Statistics .................................................................................... 10 2.1 Asset Valuation – All Classes ........................................................................... 10 2.2 Source of Condition Data ............................................................................... 10 2.3 Overall Condition – All Asset Classes ............................................................. 12 2.4 Financial Profile ................................................................................................. 15

3 State of Local Infrastructure .............................................................................. 16 3.1 Road Network ................................................................................................... 17

3.1.1 Asset Inventory .............................................................................................. 18 3.1.2 Replacement Cost Valuation ..................................................................... 18 3.1.3 Asset Useful Life – Road Network ................................................................ 20 3.1.4 Infrastructure Investment in Bruce County – Road Network .................. 20 3.1.5 Useful Life Consumption ............................................................................... 21 3.1.6 Current Asset Condition ............................................................................... 22 3.1.7 Forecasting Replacement Needs .............................................................. 24

3.2 Bridges & Culverts ............................................................................................. 25 3.2.1 Asset Inventory .............................................................................................. 26 3.2.2 Replacement Cost Valuation ..................................................................... 26 3.2.3 Asset Useful Life – Bridges & Culverts .......................................................... 28 3.2.4 Infrastructure Investment in Bruce County – Bridges & Culverts ............. 28 3.2.5 Useful Life Consumption ............................................................................... 29 3.2.6 Current Asset Condition ............................................................................... 30 3.2.7 Forecasting Replacement Needs .............................................................. 31

3.3 Social Housing ................................................................................................... 33 3.3.1 Asset Inventory .............................................................................................. 34 3.3.2 Replacement Cost Valuation ..................................................................... 36

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3.3.3 Asset Useful Life – Social Housing ................................................................ 39 3.3.4 Infrastructure Investment in Bruce County – Social Housing ................... 40 3.3.5 Useful Life Consumption ............................................................................... 41 3.3.6 Current Asset Condition ............................................................................... 42 3.3.7 Forecasting Replacement Needs .............................................................. 43

3.4 Buildings ............................................................................................................. 44 3.4.1 Asset Inventory .............................................................................................. 45 3.4.2 Replacement Cost Valuation ..................................................................... 46 3.4.3 Asset Useful Life – Buildings .......................................................................... 48 3.4.4 Investment in Buildings ................................................................................. 48 3.4.5 Useful Life Consumption ............................................................................... 49 3.4.6 Current Asset Condition ............................................................................... 50 3.4.7 Forecasting Replacement Needs .............................................................. 51

3.5 Land Improvement .......................................................................................... 52 3.5.1 Asset Inventory .............................................................................................. 53 3.5.2 Replacement Cost Valuation ..................................................................... 53 3.5.3 Asset Useful Life – Land Improvements ...................................................... 55 3.5.4 Investment in Land Improvements ............................................................. 55 3.5.5 Useful Life Consumption ............................................................................... 56 3.5.6 Current Asset Condition ............................................................................... 57 3.5.7 Forecasting Replacement Needs .............................................................. 58

3.6 Machinery & Vehicles ...................................................................................... 59 3.6.1 Asset Inventory .............................................................................................. 60 3.6.2 Replacement Cost Valuation ..................................................................... 60 3.6.3 Asset Useful Life – Machinery & Vehicles ................................................... 62 3.6.4 Investment in Machinery & Vehicles .......................................................... 62 3.6.5 Useful Life Consumption ............................................................................... 63 3.6.6 Current Asset Condition ............................................................................... 64 3.6.7 Forecasting Replacement Needs .............................................................. 65

3.7 Equipment, Furniture & Fixtures ...................................................................... 66 3.7.1 Asset Inventory .............................................................................................. 67 3.7.2 Replacement Cost Valuation ..................................................................... 67 3.7.3 Asset Useful Life – Equipment, Furniture & Fixtures ................................... 69 3.7.4 Investment in Equipment, Furniture & Fixtures .......................................... 69 3.7.5 Useful Life Consumption ............................................................................... 70 3.7.6 Current Asset Condition ............................................................................... 71 3.7.7 Forecasting Replacement Needs .............................................................. 72

3.8 Technology & Communication ...................................................................... 73 3.8.1 Asset Inventory .............................................................................................. 74 3.8.2 Replacement Cost Valuation ..................................................................... 74 3.8.3 Asset Useful Life – Technology & Communication ................................... 76 3.8.4 Investment in Technology & Communication .......................................... 76 3.8.5 Useful Life Consumption ............................................................................... 77 3.8.6 Current Asset Condition ............................................................................... 78 3.8.7 Forecasting Replacement Needs .............................................................. 79

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3.9 Trail Programs .................................................................................................... 80 3.9.1 Asset Inventory .............................................................................................. 81 3.9.2 Replacement Cost Valuation ..................................................................... 81 3.9.3 Asset Useful Life – Trail Programs ................................................................. 83 3.9.4 Investment in Trail Programs ........................................................................ 83 3.9.5 Useful Life Consumption ............................................................................... 84 3.9.6 Current Asset Condition ............................................................................... 85 3.9.7 Forecasting Replacement Needs .............................................................. 86

4. Levels of Service ................................................................................................. 87 4.1 Guiding Principles for Developing Levels of Service ................................... 87 4.2 Key Performance Indicators and Targets ..................................................... 88 4.3 Future Performance ........................................................................................ 92 4.4 Monitoring, Updating and Actions ............................................................... 93

5. Asset Management Strategies ........................................................................... 94

5.1 Non-Infrastructure Solutions and Requirements .......................................... 94 5.2 Condition Assessment Programs .................................................................... 94

5.2.1 Pavement Network Inspections .................................................................. 95 5.2.2 Bridges & Culverts Inspections .................................................................... 96 5.2.3 Buildings & Facilities ...................................................................................... 97 5.2.3 Fleet ................................................................................................................. 97

5.3 Lifecycle Framework ........................................................................................ 99 5.3.1 Paved Roads ................................................................................................. 99 5.3.2 Bridges & Culverts (greater than 3m span) ............................................. 103 5.3.3 Buildings & Facilities .................................................................................... 103 5.3.3 Trail Programs ............................................................................................... 103 5.3.4 Fleet and Vehicles ...................................................................................... 104

5.4 Growth and Demand .................................................................................... 105 4.5 Project Prioritization ........................................................................................ 106 5.6 Risk Matrices .................................................................................................... 108

6. Financial Strategy ............................................................................................. 114 6.1 General overview of financial plan requirements .................................... 114 6.2 Current Financial Profile ................................................................................. 116

6.2.1 Funding objective ....................................................................................... 116 6.2.2 Current funding position ............................................................................ 116

6.3 Recommendations for full funding .............................................................. 117 6.4 Use of debt ........................................................................................................... 120 6.5 Use of reserves ..................................................................................................... 123

6.5.1 Available reserves ........................................................................................ 123 6.5.2 Recommendation ........................................................................................ 124

7. Appendix: Infrastructure Report Card ............................................................. 114

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Executive Summary Infrastructure is inextricably linked to the economic, social and environmental advancement of a community. Municipalities own and manage nearly 60% of the public infrastructure stock in Canada. The nine asset categories assessed in this asset management plan (AMP) for Bruce County had a total valuation of $776 million in 2015, with roads comprising $398 million, or 51%, of the County’s portfolio. Strategic asset management is critical in extracting the highest total value from public assets at the lowest lifecycle cost. This AMP details the state of infrastructure of the County’s various service areas and provides asset management and financial strategies designed to facilitate the County’s pursuit of developing an advanced asset management program and mitigate long-term funding gaps. Based on 2015 replacement cost, and a blend of age-based and observed data, less than 50% of the County’s total asset portfolio as analysed in this AMP is in very good or good condition. More than 28% is in poor or very poor condition. Based on observed data, more than 20% of the County’s road network, with a 2015 replacement value of more than $80 million were determined to be in poor to very poor condition. At 21% of the total share of the County’s asset portfolio, with a valuation of $163 million, bridges & culverts are the County’s second largest asset class. Based on a combination of assessed and age based data, more than 58% of these assets were deemed to be in good to very good condition. These assets have a current replacement value of $95 million. While current asset health is an imperative indicator of the County’s asset management maturity, equally important is the County’s ability to fund the long-term replacement needs of each of its asset classes. The average annual investment requirement for the County’s asset classes is $23,731,000. Annual revenue currently allocated to these assets for capital purposes is $11,834,000 leaving an annual deficit of $11,897,000. To put it another way, these infrastructure categories are currently funded at 49.9% of their long-term requirements. In 2016, Bruce County has annual tax revenues of $41,902,000. Without consideration of any other sources of revenue, full funding would require the following:

1. when realized, reallocating the debt cost reductions of $3,265,000 to the infrastructure deficit as outlined above.

2. increasing tax revenues by 1.3% each year for the next 15 years solely for the purpose of phasing in full funding to the asset categories covered in this AMP.

3. continuing to allocate the gas tax revenue to the roads network category. 4. increasing existing and future infrastructure budgets by the applicable inflation

index on an annual basis in addition to the deficit phase-in.

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1. Introduction & Background Across Canada, municipal share of public infrastructure increased from 22% in 1955 to nearly 60% in 2013. The federal government’s share of critical infrastructure stock, including roads, water and wastewater, declined by nearly 80% in value since 1963.1 Figure 1-1 Distribution of Net Stock of Core Public Infrastructure in Canada Total: $382B Year: 2013

Ontario’s municipalities own more of the province’s infrastructure assets than both the provincial and federal government. The asset portfolios managed by Ontario’s municipalities are also highly diverse. Bruce County owns approximately $776 million of these public assets in nine distinct service areas:

1. Roads 2. Bridges & Culverts 3. Social Housing 4. Buildings 5. Land Improvements 6. Machinery & Vehicles 7. Equipment, Furniture & Fixtures 8. Technology & Communication 9. Trail Programs

1 Larry Miller, Updating Infrastructure In Canada: An Examination of Needs And Investments Report of the Standing Committee on Transport, Infrastructure and Communities, June 2015

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Bruce County relies on these assets to provide residents, businesses, employees and visitors with safe access to important services, such as transportation, recreation, culture, economic development and much more. As such, it is critical that the County manage these assets by making the right decisions, at the right time, for the right reasons, and for the right costs. This will assist the County in this pursuit of judicious asset management for its various asset classes and service areas. 1.1 What is Asset Management? Asset Management (AM) can be best defined as an integrated business approach within an organization that minimizes the lifecycle costs of owning, operating, and maintaining assets, at an acceptable level of risk, while continuously delivering established levels of service for present and future customers. AM includes the planning, design, construction, operation and maintenance of infrastructure used to provide services. By utilizing AM processes, infrastructure needs can be prioritized over time, while ensuring timely investments to minimize repair and rehabilitation costs and maintain municipal assets. Key Questions municipalities must ask themselves today as they develop their AMPs and programs are the following:

What do you have and where is it? What is it worth? What is its condition and expected remaining service life? What is the level of service expectation, and what needs to be done? When do you need to do it? How much will it cost and what is the acceptable level of risk(s)? How do you ensure long-term affordability?

1.2 Asset Management Principles The Institute of Asset Management (IAM) recommends the adoption of seven key principles for a sustainable asset management program. According to IAM, asset management must be:2

1. Holistic: asset management must be cross-disciplinary, total value focused 2. Systematic: rigorously applied in a structured management system 3. Systemic: looking at assets in their systems context, again for net, total value 4. Risk-based: incorporating risk appropriately into all decision-making 5. Optimal: seeking the best compromise between conflicting objectives, such as

costs versus performance versus risks etc. 6. Sustainable: plans must deliver optimal asset life cycles, ongoing systems

performance, environmental and other long term consequences. 7. Integrated: at the heart of good asset management lies the need to be joined-up.

The total jigsaw puzzle needs to work as a whole - and this is not just the sum of the parts.

2 “Key Principles”, The Institute of Asset Management, www.iam.org

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1.3 Purpose of the AMP This asset management plan was developed to support the County’s strategic vision for its asset management practice and programs. The AMP provides key asset attribute data, including current composition, inventory, useful life etc., summarizes the physical health of the capital assets, assess the County’s current capital spending framework, and enumerates financial strategies to achieve infrastructure sustainability in the long-term and mitigate any funding gaps. 1.4 Contents of the AMP As in 2013, this AMP is developed in accordance with the Province of Ontario’s Building Together: Guide for Municipal Asset Management Plans and includes the following core components: Table 1-1 Contents of the AMP

# Section Title Description

1 Introduction

Explains how the goals of the County are dependent on infrastructure, and clarifies the relationship of the AM Plan to municipal planning and financial documents. Establishes the asset classes that are included in the AMP and the recommended update frequency.

2 State of Local Infrastructure

Summarizes the asset hierarchy, inventory, valuation, age distribution and condition. Also discusses how and when information regarding the characteristics, value, and condition of assets will be updated.

3 Levels of Service

Defines levels of service through performance indicators and targets, and outlines current performance. Describes external trends or issues that may affect expected levels of service.

4 Asset Maintenance

and Renewal Strategies

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, and at the lowest life cycle cost.

5 Financing Strategy This section integrates asset management planning with financial planning and budgeting.

6 Recommendations

Provides a summary of the state of the infrastructure, current level of service, and recommended asset management and funding strategies. Also summarizes recommendations for monitoring achievement of the AM objectives and for continuous improvement of the AM Plan in future updates.

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1.5 Developing the Asset Management Plan 1.5.1 Context This is Bruce County’s second asset management plan and is a continuation of the staff’s substantial efforts to develop a sustainable and systematic asset management program. In 2013, the County had completed an AMP for three major asset classes: roads, bridge & culverts, and social housing. The AMP comprised three asset classes (roads, bridges & culverts, and social housing) with a total replacement value of $542 million. In this regard, with nine asset classes, the 2016 edition of the AMP is a significant step forward in fortifying the County’s asset management program. 1.5.2 Dataset The County’s infrastructure datasets for each of the nine asset classes analysed in this document is maintained in PSD’s CityWide® Tangible Assets module. Each dataset includes key asset attributes and PSAB 3150 data, including historical costs, in-service dates, field inspection data (as available), asset health, replacement costs, etc. 1.5.3 Amortization Municipalities implement a straight-line amortization schedule approach to depreciate their capital assets. In general, this approach is not reflective of the true nature of the deterioration of many capital assets, which tend to decline in condition at a faster rate toward the end of their lifecycle. However, it is a useful approximation in the absence of standardized decay models and actual field condition data and can provide a benchmark for future requirements. We analyze each asset individually; therefore, while deficiencies may be presents at the individual level, imprecisions are minimized at the asset-class level as the data is aggregated. 1.5.4 Financial Analysis In this AMP, the average annual investment requirement is the amount municipalities should set aside annually for each infrastructure class so that assets can be replaced upon reaching the end of their lifecycle. This amount fluctuates annually depending on how many assets are fully amortized or are marked for disposal and replacement. This is the minimum amount that should be allocated. To determine current funding capacity, all existing sources of funding are identified, aggregated, and an average for the previous three years is calculated, as data is available. These figures are then used to calculate the annual funding shortfall (surplus), and used as the benchmarks for forecasting future revenue levels, and for forming the financial strategies. In addition to the annual shortfall, the majority of municipalities face significant infrastructure backlogs. The infrastructure backlog is the accrued financial investment needed in the short-term, e.g., immediately and within the next five years, to bring the assets to a state of good repair. This amount is identified for each asset class. Only predictable sources of funding are used, e.g., tax and rate revenues, user fees and other streams of income the County can rely on with a high degree of certainty.

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Government grants and other ad-hoc injections of capital are not enumerated in this asset management plan given their unpredictability. As senior governments make greater, more predictable and permanent commitments to funding municipal infrastructure programs, e.g., the federal Gas Tax Fund, future iterations of PSD’s asset management plan will account for such funding sources. 1.5.5 Field Inspection Data Field condition data was available for road surfaces and bridges which was used to make recommendations more precise. The value of condition data cannot be overstated as they provide a more accurate representation of the state of infrastructure. For the remaining asset categories an age-based condition assessment was applied.

1.5.6 Infrastructure Report Card The asset management plan is a complex document, but one with direct implications on the public, a group with varying degrees of technical knowledge. To facilitate communications, we have developed an Infrastructure Report Card that summarizes our findings in accessible language that municipalities can use for internal and external distribution. The report card is developed using two key, equally weighted factors:

1. Financial Capacity (Weight: 50%): A County’s financial capacity is determined by how well it’s meeting the average annual investment requirements (0-100%) for each infrastructure class.

2. Asset Health (Weight: 50%): Using either field inspection data as available or age-based data, the asset health provide a grades for each infrastructure class based on the portion of assets in poor to excellent condition (0-100%). We use replacement cost to determine the weight of each condition group within the asset class.

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Table 1-2: Financial Capacity How well is the County funding its long-term infrastructure requirements? Weight: 50%

Letter grade Rating Funding

Percentage Description

A Excellent 90-100% The County is fully prepared for its long-term replacement needs based on existing infrastructure portfolio.

B Good 70-89%

The County is well prepared to fund its long-term replacement needs but requires additional funding strategies in the short-term to begin to increase its reserves.

C Fair 60-69%

The County is underpreparing to fund its long-term infrastructure needs. The replacement of assets in the short- and medium-term will likely be deferred to future years.

D Poor 40-59%

The County is not well prepared to fund its replacement needs in the short-, medium- or long-term. Asset replacements will be deferred and levels of service may be reduced.

F Very Poor 0-39%

The County is significantly underfunding its short-term, medium-term, and long-term infrastructure requirements based on existing funds allocation. Asset replacements will be deferred indefinitely. The County may have to divest some of its assets (e.g., bridge closures, arena closures) and levels of service will be reduced significantly.

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Table 1-3: Asset Health What is the physical condition of the assets? Weight: 50%

Letter Grade Rating Performance Description

A Very good Fit for the future The asset is functioning and performing well, only normal preventative maintenance is required.

B Good Adequate for now

The asset is functioning and performing well, but future repair or rehabilitation activities are identified.

C Fair Requires intervention

The asset’s performance or function has started to degrade and repair/rehabilitation is required to minimize lifecycle cost.

D Poor At risk The asset’s performance and function is below the desired level and immediate repair/rehabilitation is required.

F Very Poor Unfit for

sustained service

Approaching end of useful life, repair/rehabilitation is no longer an option. Replacement is required in the near future.

A detailed breakdown of all calculations can be found in the appendix. 1.5.7 Timeframe All assets assessed in this document were subjected to at least one iteration of replacement. This replacement profile is illustrated for each asset class and is intended to quantify their respective future replacement needs over the next 50 years. The timeframe for the financial strategies varies depending on the financial demand placed on citizens. This phase-in period typically varies from 10 to 15 years. This ensures that urgent infrastructure needs are integrated into the asset management plan. However, the timeframe may exceed this target if tax or rates increases are prohibitive and place excessive burden on residents.

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1.5.8 Limitations Several limitations continue to persist as municipalities advance their asset management practices.

1. As available, we use field condition assessment data to determine both the state of infrastructure and develop the financial strategies. However, in the absence of observed data, we rely on the age of assets to estimate their physical condition. Road surfaces and bridges are the only assets categories with field based condition assessments.

2. A second limitation is the use of inflation measures, for example using

CPI/NRBCPI to inflate historical costs in the absence of actual replacement costs. While a reasonable approximation, the use of such multipliers may not be reflective of market prices and may over or understate the value of a County’s infrastructure portfolio and the resulting capital requirements.

3. Our calculations and recommendations will reflect the best available data at the

time this AMP was developed.

4. The focus of this plan is restricted to capital expenditures and does not capture O&M expenditures on infrastructure.

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GAP ANALYSIS 1: CITYWIDE TA Review client database and assess

against benchmark municipalities

DATA VALIDATION 1 Collaborate with Engineering and

Finance to validate and refine data

GAP ANALYSIS 2: CITYWIDE CPA Review client database and assess against benchmark municipalities

DATA VALIDATION 2 Collaborate with Finance to validate and refine data prior to the

developing financial strategy

DATA APPROVAL Client approves all asset and financial data before PSD can develop financial strategy

FINANCIAL STRATEGY PSD submits financial

strategy to client for review

IS STRATEGY

APPROVED

AMEND FINANCIAL STRATEGY Collaborate with client to

redevelop financial strategy

YES

NO

IS DRAFT APPROVED?

AMEND DRAFT AS NEEDED Incorporate client feedback and redevelop draft as needed and feasible

NO SUBMIT FINAL AMP DRAFT PSD submits final asset management plan and report card for client sign-off on project

YES

FIRST DRAFT PSD submits first complete

draft of the AMP

1.5.9 Process: Work order and Work flow High data quality is the foundation of intelligent decision-making. Generally, there are two primary causes of poor decisions: Inaccurate or incomplete data, and the misinterpretation of data used. Figure 1-2 illustrates an abbreviated version of our work order/work flow process between PSD and municipal staff. It is designed to ensure maximum confidence in the raw data used to develop the AMP, the interpretation of the AMP by all stakeholders, and ultimately, the application of the strategies outlined in this AMP. Figure 1-2 Developing the AMP: Work Order/Work Flow

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2. Key Aggregate Statistics In this section, we outline key aggregate indicators to summarize important elements of the County’s nine asset classes. In Section 3, the state of local infrastructure will be discussed in detail for each asset class. 2.1 Asset Valuation – All Classes Bruce County’s nine asset classes had a total 2015 valuation of $776 million, or $11,739 per capita based on its 2011 population of 66,102. Figure 2-1 illustrates the breakdown of this portfolio by asset class. Figure 2-1 2015 Asset Valuation by Class

2.2 Source of Condition Data Observed data will provide the most precise indication of an asset’s physical health. In the absence of such information, age of capital assets can be used as a meaningful approximation of the asset’s condition. Table 2-1 indicates the source of condition data used for each of the nine asset classes in this AMP.

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Table 2-1 Source of Condition Data

Asset Class Condition Data Source

Road Network

Surface Assessed (PCI)

Base Age-based

Signs & Traffic Signals Age-based

Bridges & Culverts Assessed (BCI)

Social Housing Age-based

Buildings Age-based

Land Improvements Age-based

Machinery & Vehicles Age-based

Equipment - Furniture & Fixtures Age-based

Technology & Communication Age-based

Trail Programs Age-based

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2.3 Overall Condition – All Asset Classes Based on 2015 replacement cost, and a blend of age-based and observed data, just over 50% of the County’s total asset portfolio as analysed in this AMP is in very good or good condition. More than 27% is in poor or very poor condition. Figure 2-2 Asset Condition Distribution by Replacement Cost

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In conjunction with condition data, two other measurements can augment staff understanding of the state of infrastructure and impending and long-term infrastucture needs: installation year profile, and useful life remaining. The installation year profile illusrates the historical investments in infrastructure across key asset classes. Often, investment in critical infrastructure parallels population growth or other significant shifts in demographics. The figure below indicates that the County invested rapidly and heavily in its roads and bridges assets in the late 1990s, with a second substantial increase between 2001 and 2005 in which the County invested more than $118 million in its buildings assets, mainly due to the downloading of social housing, new museum and 2 new long-term care facilities. While the overall investment in infrastructure declined sharply after 2005, the investments in roads increased from $68.8 to $81.2 million. The last five years have seen a continued emphasis on the County’s Buildings, with the municipailty investing $21 million between 2011-2015 in this asset class. Figure 2-3 Historical Infrastructure Investment in Bruce County Using Installation Year – All Classes

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While age is not a precise indicator of an asset’s health, it can serve as a meaningful approxmiation in the absence of condition data and can serve as a signal. The following figure shows the distibution of assets based on the amount of useful life already consumed. Figure 2-4 Useful Life Remaining – All Asset Classes

While the majority of the County’s assets analyzed in this document have more than 10 years of useful life remaining, nearly 12%, with a current replacement value of $91 million, are in operations beyond their useful life, while the useful life of an additional 7.5% of assets, with a valuation of $58.2 million, is set to expire in the next five years.

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2.4 Financial Profile This section details key financial indicators related to the County’s asset classes as analyzed in this asset management plan. Figure 2-5 Annual Requirements by Asset Class

The annual requirements represent the amount the County should allocate annually to each of its asset classes to meet replacement need as they arise and prevent infrastructure backlogs. The backlogs in Figure 2-6 represent the immediate investment needed to eliminate the pent-up demand for each asset class. Figure 2-6 Backlog by Asset Class

$10,019,000

$4,181,000

$3,187,000

$2,760,000

$350,000

$1,548,000

$934,000

$667,000

$85,000

Roads Network

Bridges & Culverts

Social Housing

Buildings

Land Improvements

Machinery & Vehicles

Equipment, Furniture & Fixtures

Technology & Communication

Trail Programs

Annual Requirements

$260,136

$11,576,241

$12,754,444

$10,665,058

$251,840

$4,033,715

$931,968

$743,228

$0

Roads Network

Bridges & Culverts

Social Housing

Buildings

Land Improvements




Trail Programs

Backlogs

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3 State of Local Infrastructure In this section, we detail key indicators for each class discussed in this asset management plan. The state of local infrastructure includes the full inventory, condition ratings, useful life consumption data, and the backlog and upcoming infrastructure needs for each asset class.

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Road Network

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3.1 Road Network

3.1.1 Asset Inventory Bruce County’s road network comprises approximately 691.27 km of road surface (HCB, LCB, and Gravel) and the equivalent of rural and urban road base.

3.1.2 Replacement Cost Valuation Table 3-2 outlines how the current replacement value of each asset type was derived.

Table 3-1 Asset Inventory – Road Network

Asset Class Asset Type Quantity (Area m2)

Quantity (Length km)

Road Network

Base – Rural 4,638,661 652.63 Base – Urban 335,742 38.64

Surface – HCB Rural 3,373,487 473.77 Surface – HCB Urban 319,756 36.68 Surface – LCB Rural 1,171,509 164.45 Surface – LCB Urban 15,986 1.96

Surface – Gravel Rural 93,665 14.41

Signs & Traffic Signals Road Signs Pooled Quantity Traffic Signs 18 Quantity

Table 3-2 Deriving Asset Valuation

Asset Class Asset Type Valuation Method

Road Network

Base – Rural $50.74 - $57.60/(m2) Base – Urban $122.98 - 129.70/(m2)

Surface – HCB Rural $24.22/(m2) Surface – HCB Urban $24.22/(m2) Surface – LCB Rural $17.50/(m2) Surface – LCB Urban $17.50/(m2)

Signs & Traffic Signals Road Signs CPI Traffic Signs CPI

19

Figure 3-1 Estimated 2015 Asset Valuation – Road Network Total: $397.8 million

20

3.1.3 Asset Useful Life – Road Network The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

3.1.4 Infrastructure Investment in Bruce County – Road Network In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s road network. Figure 3-2 Infrastructure Investment in Bruce County by Installation Year Based on 2015 Replacement Cost

Table 3-3 Asset Useful Life in Years – Road Network

Asset Class Asset Type Quantity (Area m2)

Useful Life

Road Network

Base – Rural 4,638,661 75

Base – Urban 335,742 50

Surface – HCB Rural 3,373,487 18

Surface – HCB Urban 319,756 18

Surface – LCB Rural 1,171,509 15

Surface – LCB Urban 15,986 15

Signs & Traffic Signals Road Signs Pooled 10

Traffic Signs 18 10

21

3.1.5 Useful Life Consumption In this section, we detail the extent to which each asset class has consumed its useful life based on the above, established useful life standards.

Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-3 illustrates the useful life consumption distribution for the County’s roadnetwork. It includes surface, base and traffic signals and signs.

Figure 3-3 Remaining Useful Life – Road Network

Nearly 80% of the County’s road network assets, based on replacement cost, have more than 10 years of useful life remaining. However, 2% of its assets, worth approximately $7.5 million remain in operation beyond their useful life; an additional 7%, with a replacement value of $26.2 million will see their useful life expire in the next five years.

22

3.1.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s roads network by segment. The County has provided observed condition data for its road surfaces. For all other segments, age is used to estimate the condition rating. Figure 3-4 Asset Condition – Road Surface Source: Assessed Condition

With a 2015 valuation of $110 million, the County’s road surfaces comprise approximately 27% of its $397.8 million total road network portfolio. Figure 3-4 illustrates that 46% of the County’s road surfaces are in good to very good condition and approximately 19% are in poor to very poor condition and the remaining 35% being in fair condition. Figure 3-5 shows that approximately 50% of the County’s rural and urban roads base is in good to very good condition. However, nearly 20% is in poor to very poor condition. Signs and traffic signals comprise the smallest portion of the County’s road network. Figure 3-6 indicates that, based on age data, more than one third of these assets are in poor to very poor condition.

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Figure 3-5 Asset Condition – Road Base Source: Age-based Data

Figure 3-6 Asset Condition – Signs and Traffic Signals Source: Age-based Data

24

3.1.7 Forecasting Replacement Needs In the following sections, we illustrate the short, medium and long-term infrastructure spending requirements (replacement only) for the County’s road network assets. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-7 Forecasting Replacement Needs: Road Network

While the backlog for Bruce County’s road network totalled approximately $260,000, the County will see a dramatic increase in lifecycle requirements in the next five years, totalling more than $55 million. Rural surface (HCB) replacement will comprise more than $35.8 million of these forecasted capital expenditures. To maintain a sustainable road network, the County’s annual requirements total approximately $10.0 million. This is the amount the County should set aside each year to ensure replacement needs are met. Deferring replacement expenditures will increase the backlog, or pent-up infrastructure demand.

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Bridges & Culverts

26

3.2 Bridges & Culverts 3.2.1 Asset Inventory Bruce County owns 83 bridges and 74 culverts.


Table 3-4 Asset Inventory – Bridges & Culverts

Asset Class Asset Type Quantity Unit of Measure

Bridges & Culverts Bridges 83 Quantity Culverts 74 Quantity

Table 3-5 Deriving Asset Valuation

Asset Class Asset Type Valuation Method

Bridges

Bridges - Deck 2015/2013 OSIM/CPI Bridges - Footings 2015/2013 OSIM/CPI

Super Structure 2015/2013 OSIM/CPI

Bridge Guiderails 2015/2013 OSIM/CPI

Culverts Culverts 2015/2013 OSIM/CPI

Culvert Guiderails 2015/2013 OSIM/CPI

27

Figure 3-8 Estimated 2015 Asset Valuation – Bridges & Culverts Total: $163 million

28

3.2.3 Asset Useful Life – Bridges & Culverts The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® TangibleAsset module.

3.2.4 Infrastructure Investment in Bruce County – Bridges & Culverts

In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s bridges & culverts.

Figure 3-9 Infrastructure Investment in Bruce County by Installation Year Based on 2015 Replacement Cost

Table 3-6 Asset Useful Life in Years – Bridges & Culverts

Asset Class Asset Type Quantity Useful Life in Years

Bridges & Culverts

Bridges 83 25/50/75

Culverts 74 25/45

29


Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-10 illustrates the useful life consumption distribution for the County’s bridges & culverts.

Figure 3-10 Remaining Useful Life – Bridges & Culverts

More than 26% of the County’s bridges & culverts are in operations beyond their usefullife. An additional 6.6%, with a replacement value of $10.7 million will see their useful life expire in the next five years.

30

3.2.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s bridges & culverts. The County has provided field condition data for all assets.

Figure 3-11 Asset Condition – Bridges Source: Assessed Condition

Figure 3-12 Asset Condition – Culverts Source: Assessed Condition

17% of the County’s bridges and 35% of its culverts are in poor to very poor condition. However, the majority, at least 60%, of its bridges and culverts are in good to very good condition.

31

3.2.7 Forecasting Replacement Needs In the following sections, we illustrate the short, medium and long-term infrastructure spending requirements (replacement only) for the County’s bridges & culverts. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-13 Forecasting Replacement Needs – Bridges

Figure 3-14 Forecasting Replacement Needs – Culverts

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The backlog for Bruce County’s bridges & culverts is $11,576,000 and the County’s short-term needs will total approximately $42.2 million in the next five years. This asset class will also require an additional $29 million between 2020-2024. To maintain a sustainable bridges & culverts assets class, the County’s annual requirements total approximately $4.2 million. This is the amount the County should set aside each year to ensure replacement needs are met.

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Social Housing

34

3.3 Social Housing 3.3.1 Asset Inventory The table below outlines the various segments and components under its social housing asset class.

Table 3-7 Asset Inventory – Social Housing Asset Class

Asset Component Asset Component Quantity Unit of Measure

Social Housing

Building – Elevator Elevator - Mechanical Elevator 6 Quantity

Building - Exterior

Balconies Concrete/Steel 334 Quantity Balconies Wood 267 Quantity/Length (ft)

Doors - Aluminium/Composite 501 Quantity Doors - Hollow Metal 794 Quantity

Doors - Industrial 4 Quantity Exterior Finishes - Metal Cladding/Stucco/EIFS 25,475 Area (sqft)

Exterior Finishes - Vinyl/Wood/Composite Cladding 36,040 Area (sqft) Facia/Eaves/Downspouts/Soffit 3,638 Area (sqft)/Quantity

Masonry/Concrete/Stone 212,322 Area (sqft)/Quantity Other Exterior 54,512 Length (ft) /Quantity

Roof Asphalt Shingles/Modified Bitumen/Wood Shingles & Shak 387,060 Area (sqft)/Area(m) Roof Metal 19,840 Area (sqft) Windows 2,108 Quantity

Building – Fire & Life Safety

Fire & Life Safety - Exit and Emergency Light System 42 Quantity Fire & Life Safety - Fire Alarm System 56 Quantity

Fire & Life Safety - Fire Protection/Sprinkler 29 Quantity Fire & Life Safety - Smoke/Carbon Monoxide Alarm Device 940 Quantity

Building - Interior

Interior - Appliances - Kitchen 1,330 Quantity Interior - Appliances - Laundry - Residential Units 106 Quantity

Interior - Commercial Doors/Windows 943 Quantity Interior - Flooring - Carpet/Laminate 73,231 Area (sqft)/Quantity

Interior - Flooring - Ceramic Tile/Stone 18,411 Area (sqft)/Quantity Interior - Flooring - Vinyl Tile/Vinyl Sheet/Hardwood 366,645 Area (sqft)/Quantity

35

Asset Class Asset Component Asset Component Quantity Unit of Measure

Social Housing

Building - Interior

Interior - Furnishings/Shelving 287 Quantity Interior - Guards/Handrails/Millwork 9,244 Quantity/Length (ft)

Interior - Kitchen/Bathroom/Laundry Upgrades 1,419 Quantity Interior - Residential Doors 4,285 Quantity

Building - Mechanical

Mechanical/Electrical - Communication & Security System 61 Quantity Mechanical/Electrical - Electrical 1,186 Quantity

Mechanical/Electrical - Exhaust Fans 1,617 Quantity Mechanical/Electrical - Exterior Lighting 546 Quantity

Mechanical/Electrical - Heating Ventilation & Air Conditioning System 4,227 Quantity Mechanical/Electrical - Interior Lighting 5,824 Quantity

Mechanical/Electrical - Other Mechanical/Electrical 76 Quantity Mechanical/Electrical - Plumbing 3,169 Quantity

Building – Site Services

Site Services - Electric Power/Fuel Supply 33 Quantity Site Services - Water/Sewer 41 Quantity

Building - Structures Structure 35 Quantity


Vehicles 1 Quantity Machinery 1 Quantity


Hardware 24 Quantity Software 8 Quantity

Land Improvement

Site Elements - Asphalt/Concrete 383,257 Area (sqft)/Quantity Site Elements - Concrete/Stone Retaining Walls 180 Quantity/Length (ft)

Site Elements - Fencing/Guards/Handrails - Other 4,374 Quantity/Length (ft) Site Elements - Fencing/Guards/Handrails - Wood 10,823 Quantity/Length (ft)

Site Elements – Misc (Shed/Signs) 49 Quantity Site Elements - Other Site Elements 143 Quantity/Area (sq ft) Site Elements - Playground Equip 4 Quantity

Site Elements - Site Drainage 10 Quantity Equipment Office Furniture 14 Quantity

36


Table 3-8 Asset Inventory – Social Housing Asset Class

Asset Component Asset Component Valuation Method

Social Housing

Building – Elevator Elevator - Mechanical Elevator User-Defined Cost/CPI

Building - Exterior

Balconies Concrete/Steel User-Defined Cost/CPI /Cost per Unit

Balconies Wood CPI/User-Defined Cost

Doors - Aluminium/Composite User-Defined Cost/CPI /Cost per Unit

Doors - Hollow Metal User-Defined Cost/CPI /Cost per Unit

Doors - Industrial User-Defined Cost/Cost per Unit Exterior Finishes - Metal Cladding/Stucco/EIFS User-Defined Cost/CPI

Exterior Finishes - Vinyl/Wood/Composite Cladding User-Defined Cost/CPI Facia/Eaves/Downspouts/Soffit User-Defined Cost/CPI

Masonry/Concrete/Stone User-Defined Cost/CPI Other Exterior User-Defined Cost/CPI

Roof Asphalt Shingles/Modified Bitumen/Wood Shingles & Shak User-Defined Cost/CPI/Cost per Unit Roof Metal User-Defined Cost/CPI Windows User-Defined Cost/CPI/Cost per Unit

Building – Fire & Life Safety

Fire & Life Safety - Exit and Emergency Light System User-Defined Cost/CPI/Cost per Unit Fire & Life Safety - Fire Alarm System User-Defined Cost/CPI

Fire & Life Safety - Fire Protection/Sprinkler User-Defined Cost Fire & Life Safety - Smoke/Carbon Monoxide Alarm Device Cost per Unit

Building - Interior

Interior - Appliances - Kitchen User-Defined Cost/CPI /Cost per Unit

Interior - Appliances - Laundry - Residential Units CPI/Cost per Unit Interior - Commercial Doors/Windows CPI/Cost per Unit Interior - Flooring - Carpet/Laminate User-Defined Cost/CPI

Interior - Flooring - Ceramic Tile/Stone CPI Interior - Flooring - Vinyl Tile/Vinyl Sheet/Hardwood Cost per Unit

37

Asset Class Asset Component Asset Component Valuation Method

Social Housing

Building - Interior

Interior - Furnishings/Shelving User-Defined Cost/CPI Interior - Guards/Handrails/Millwork User-Defined Cost/CPI

Interior - Kitchen/Bathroom/Laundry Upgrades User-Defined Cost/CPI /Cost per Unit

Interior - Residential Doors CPI/Cost per Unit

Building - Mechanical

Mechanical/Electrical - Communication & Security System User-Defined Cost/CPI

Mechanical/Electrical - Electrical User-Defined Cost/CPI/Cost per Unit

Mechanical/Electrical - Exhaust Fans CPI/Cost per Unit Mechanical/Electrical - Exterior Lighting User-Defined/CPI/Cost per Unit

Mechanical/Electrical - Heating Ventilation & Air Conditioning System User-Defined Cost/CPI /Cost per Unit

Mechanical/Electrical - Interior Lighting User-Defined/CPI Mechanical/Electrical - Other Mechanical/Electrical CPI/Cost per Unit

Mechanical/Electrical - Plumbing User-Defined Cost/CPI /Cost per Unit

Building – Site Services

Site Services - Electric Power/Fuel Supply User-Defined/CPI Site Services - Water/Sewer User-Defined/CPI

Building - Structures Structure User-Defined/CPI


Vehicles CPI Machinery CPI


Hardware CPI Software CPI

Land Improvement

Site Elements - Asphalt/Concrete User-Defined Cost/CPI Site Elements - Concrete/Stone Retaining Walls User-Defined Cost/CPI

Site Elements - Fencing/Guards/Handrails - Other User-Defined Cost/CPI Site Elements - Fencing/Guards/Handrails - Wood User-Defined Cost/CPI

Site Elements – Misc (Shed/Signs) User-Defined Cost/CPI Site Elements - Other Site Elements User-Defined Cost/CPI Site Elements - Playground Equip CPI

Site Elements - Site Drainage User-Defined Cost/CPI Equipment Office Furniture CPI

38

Figure 3-15 Estimated 2015 Asset Valuation – Social Housing Total: $101 million

39

3.3.3 Asset Useful Life – Social Housing The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

Table 3-9 Asset Useful Life in Years – Social Housing

Asset Class Asset Type Asset Component Useful Life in

Years

Social Housing

Building

Building - Exterior 10 to 50 Building - Site Elements/Land

Improvements 10 to 40

Building - Interior 10 to 50

Building - Site Services 30 and 50

Building - Mechanical/Electrical 10 to 35

Building - Fire & Life Safety 10 to 50

Building - Elevator 35

Building - Structure 50


Vehicles 5

Machinery 10


Hardware 5

Software 4 Land

Improvement Site Elements 10 to 40

Equipment Office Furniture 5

40

3.3.4 Infrastructure Investment in Bruce County – Social Housing

In this section, we provide the installation profile and asset life consumption rate using downloaded date data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s social housing.

Figure 3-16 Investment in Social Housing in Bruce County by Installation Year Based on 2015 Replacement Cost

41


Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-17 illustrates the useful life consumption distribution for the County’s social housing assets.

Figure 3-17 Remaining Useful Life – Social Housing

While the overwhelming majority, 75%, of the County’s social assets have at least six years of useful life remaining, more than 17%, with a current replacement value of $17.7 million, remain in operation beyond their useful life. An additional 7% of assets with a replacement value of $7.4 million will expire in the next five years.

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3.3.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’ssocial housing assets. In the absence of assessed condition, we use age as an approximation for asset health.

Figure 3-18 Asset Condition – Social Housing Source: Age-based Data

While approximately 30% of the County’s social housing assets are in good to verygood condition, more than 40%, with a valuation of approximately $43 million, are in poor to very poor condition.

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3.3.7 Forecasting Replacement Needs In the following sections, we illustrate the short-, medium- and long-term infrastructure spending requirements (replacement only) for the County’s social housing. The backlog represents the immediate replacement needs that were deferred over previous years or decades.

Figure 3-19 Forecasting Replacement Needs – Social Housing

The County has a significant backlog of replacement needs totalling nearly $12.7 million of which $11,485,000 is associated with buildings. These needs will continue to fluctuate, peaking at $27 million between 2025 and 2029. These figures are based on age data and not assessed condition data.

The annual requirements associated with the County’s social housing class total approximately $3.2 million. This is the amount the County should allocate annually to ensure replacement needs are met as they arise and no backlogs are accumulated.

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Buildings

45

3.4 Buildings 3.4.1 Asset Inventory Table 3-10 details Bruce County’s buildings assets.

Table 3-10 Asset Inventory – Buildings

Asset Class Structure Quantity Unit of Measure

Buildings

Cayley Street Facilities 36,855 ft2 Highways - Holyrood Shed 2,400 ft2

Highways - Invermay Salt Dome 90 ft Highways - Lucknow Shop 19,680 ft2 Highways - Paisley Shop 13,457 ft2

Highway - Walkerton Shop 16,752 ft2 Highway - Wiarton Shop 16,752 ft2

LTC - Brucelea 100,000 ft2 LTC - Gateway 70,000 ft2

Library Branches - Shelving & Signs N/A Library Headquarters 10,500 ft2

Museum 38,900 ft2 Paramedic Station - Tobermory 1,650 ft2

Trails Shed 4,000 ft2 Walkerton Admin Building 38,000 ft2

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Table 3-11 Asset Valuation – Buildings

Asset Class Structure Valuation Method

Buildings

Cayley Street Facilities NRBCPI (Toronto) Highways - Holyrood Shed NRBCPI (Toronto)

Highways - Invermay Salt Shed NRBCPI (Toronto) Highways - Lucknow Shop NRBCPI (Toronto) Highways - Paisley Shop NRBCPI (Toronto)

Highway - Walkerton Shop NRBCPI (Toronto) Highway - Wiarton Shop NRBCPI (Toronto)

LTC - Brucelea NRBCPI (Toronto) LTC - Gateway NRBCPI (Toronto)

Library Branches - Shelving & Signs NRBCPI (Toronto) Library Headquarters NRBCPI (Toronto)

Museum NRBCPI (Toronto) Paramedic Station - Tobermory NRBCPI (Toronto)

Trails Shed NRBCPI (Toronto) Walkerton Admin Building NRBCPI (Toronto)

47

Figure 3-20 Estimated 2015 Asset Valuation – Buildings Total: $84 million

48

3.4.3 Asset Useful Life – Buildings The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

3.4.4 Investment in Buildings In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s buildings assets. Figure 3-21 Investment in Buildings by Installation Year Based on 2015 Replacement Cost

Table 3-12 Asset Useful Life in Years – Buildings

Asset Class Structure Useful Life in Years

Buildings

Building - Exterior 10 to 50 Building - Site Elements/Land Improvements 10 to 40

Building - Interior 10 to 50 Building - Site Services 30 and 50

Building - Mechanical/Electrical 10 to 35 Building - Fire & Life Safety 10 to 50

Building - Elevator 35 Building - Structure 50

49

3.4.5 Useful Life Consumption In this section, we detail the extent to which each asset class has consumed its useful life based on the above, established useful life standards. Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3.22 illustrates the useful life consumption distribution for the County’s buildings. Figure 3-22 Remaining Useful Life – Buildings

While the majority, nearly 60%, of the County’s buildings assets have more than 10 years of useful life remaining, 17%, with a replacement value of $14.3 million are in operation beyond their established useful life. Further, $5.2 million in assets will see their useful life expire in the next five years.

50

3.4.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s buildings. In the absence of observed condition data, age was used to approximate the condition of the assets. Figure 3-23 Asset Condition – Buildings Source: Age-based Data

While nearly 60% of the buildings assets in Bruce County are in fair to very good condition, the remaining 40%, with a replacement value of more than $35 million, are in poor to very poor condition.

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3.4.7 Forecasting Replacement Needs In the following sections, we illustrate the short-, medium- and long-term infrastructure spending requirements (replacement only) for the County’s buildings assets. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-24 Forecasting Replacement Needs: Buildings

The County has an existing backlog of $10.6 million. In addition, buildings will require approximately $20 million in replacement needs over the next 15 years, with more than $7 million required by 2019. The annual infrastructure requirements needed to sustain the County’s buildings assets total $2.8 million. This is the amount the County should set aside each year to ensure replacement needs are met as they arise and infrastructure backlogs are prevented.

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Land Improvements

53

3.5 Land Improvement 3.5.1 Asset Inventory Table 3-13 details Bruce County’s land improvement assets.


Table 3-13 Asset Inventory – Land Improvements

Asset Class Asset Component Quantity Unit of Measure

Land Improvements

Site Elements - Asphalt/Concrete Pooled N/A Site Elements - Fencing/Guards/Handrails -

Wood Pooled N/A

Site Elements – Misc. (Shed/Signs) Pooled N/A

Site Elements - Site Drainage Pooled N/A

Table 3-14 Asset Inventory – Land Improvements

Asset Class Asset Component Valuation Method

Land Improvements

Site Elements - Asphalt/Concrete CPI/User-Defined Site Elements - Fencing/Guards/Handrails -

Wood CPI/User-Defined

Site Elements – Misc. (Shed/Signs) CPI/User-Defined

Site Elements - Site Drainage CPI/User-Defined

54

Figure 3-25 Estimated 2016 Asset Valuation – Land Improvements Total: $9.4 million

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3.5.3 Asset Useful Life – Land Improvements The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

3.5.4 Investment in Land Improvements In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s land improvement assets. Figure 3-26 Investment in Land Improvements by Installation Year Based on 2015 Replacement Cost

Table 3-15 Asset Useful Life in Years – Land Improvements

Asset Class Asset Component Useful Life in Years

Land Improvement

Site Elements - Asphalt/Concrete 20 Site Elements - Fencing/Guards/Handrails - Wood 20

Site Elements – Misc. (Shed/Signs) 20 Site Elements - Site Drainage 40

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3.5.5 Useful Life Consumption In this section, we detail the extent to which each asset class has consumed its useful life based on the above, established useful life standards. Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-27 illustrates the useful life consumption distribution for the County’s land improvements. Figure 3-27 Remaining Useful Life – Land Improvements

Less than 3% of the County’s land improvement assets are in operation beyond their established useful life. Approximately 42% of assets, with a current replacement value of $3.9 million will see their useful life expire in the next six to 10 years.

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3.5.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s land improvement assets. In the absence of observed condition data, age was used to approximate the condition of the assets. Figure 3-28 Asset Condition – Land Improvements Source: Age-based Data

While the majority, nearly 60% of the County’s land improvement assets are in fair to very good condition, the remaining are in poor to very poor condition.

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3.5.7 Forecasting Replacement Needs In the following sections, we illustrate the short-, medium- and long-term infrastructure spending requirements (replacement only) for the County’s land improvement assets. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-29 Forecasting Replacement Needs: Land Improvements

The County has a backlog of needs for its asphalt/concrete site elements totalling $252,000. While there are no replacements forecasted in the next four years, the County will see a significant demand between 2020 and 2024 totaling approximately $3.3 million. The annual requirements for the County’s land improvement assets total $350,000. This is the amount needed to ensure the County avoids deferring replacement needs and the related backlogs.

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3.6 Machinery & Vehicles 3.6.1 Asset Inventory Table 3-16 details Bruce County’s buildings assets.


Table 3-16 Asset Inventory – Machinery & Vehicles

Asset Class Component Quantity


Ambulance Fleet 15 General Vehicles 10

Heavy Duty 17 Medium Duty 28

Light Duty 1 Off Road Vehicles (ATV) 2 Machinery (Unlicensed) 64

Table 3-17 Asset Valuation – Machinery & Vehicles

Asset Class Component Valuation Method


Ambulance Fleet CPI Monthly (ON) General Vehicles CPI Monthly (ON)

Heavy Duty CPI Monthly (ON) Medium Duty CPI Monthly (ON)

Light Duty CPI Monthly (ON) Off Road Vehicles CPI Monthly (ON)

Machinery (Unlicensed) CPI Monthly (ON)

61

Figure 3-30 Estimated 2015 Asset Valuation – Machinery & Vehicles Total: $9.4 million

62

3.6.3 Asset Useful Life – Machinery & Vehicles The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

3.6.4 Investment in Machinery & Vehicles In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s machinery & vehicles assets. Figure 3-31 Investment in Machinery & Vehicles by Installation Year Based on 2015 Replacement Cost

Table 3-18 Asset Useful Life in Years – Machinery & Vehicles

Asset Class Component Useful Life in Years


Motor Vehicles 5 Machinery (Unlicenced) 10

63

3.6.5 Useful Life Consumption In this section, we detail the extent to which each asset class has consumed its useful life based on the above, established useful life standards. Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-32 illustrates the useful life consumption distribution for the County’s machinery & vehicles. Figure 3-32 Remaining Useful Life – Machinery & Vehicles

Based on age data, nearly 55% of the County’s machinery & vehicles assets are in operation beyond their useful life. Further, an additional 36%, with a replacement value of $3.4 million will reach the end of their useful life in the next five years.

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3.6.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s machinery & vehicles. In the absence of observed condition data, age was used to approximate the condition of the assets. Figure 3-33 Asset Condition – Machinery & Vehicles Source: Age-based Data

The majority, nearly 75%, of the County’s machinery & vehicles are in poor to very poor condition, with a replacement valuation of almost $7 million.

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3.6.7 Forecasting Replacement Needs In the following sections, we illustrate the short-, medium- and long-term infrastructure spending requirements (replacement only) for the County’s machinery & vehicles assets. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-34 Forecasting Replacement Needs: Machinery & Vehicles

The County has an existing backlog of needs related to its machinery & vehicles class totaling $4 million. In addition, the replacement needs will total just under $4 million in the next five years, and will continue to rise, peaking at $8.8 million between 2025 and 2029. The annual requirement, totaling $1.54 million for the County’s machinery & vehicles assets, is the amount the County should set aside each year to ensure replacement needs are met as they arise. Allocating these funds will ensure backlogs are not accumulated.

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3.7 Equipment, Furniture & Fixtures 3.7.1 Asset Inventory Table 3-19 details Bruce County’s equipment assets.


Table 3-20 Asset Valuation – Equipment, Furniture & Fixtures


Equipment

Defibrillators / Stretchers CPI Monthly (ON) Exhibit Components CPI Monthly (ON)

Library Books CPI Monthly (ON) Mattress / Beds CPI Monthly (ON)

Medical CPI Monthly (ON) Operational CPI/User-Defined Cost

Other CPI Monthly (ON) Office Equipment CPI Monthly (ON) Office Furniture CPI Monthly (ON)

Table 3-19 Asset Inventory – Equipment, Furniture & Fixtures


Equipment

Defibrillators / Stretchers Pooled Exhibit Components 17

Library Books 180,412 Mattress / Beds 483

Medical 59 Operational 35

Other 5 Office Equipment Pooled Office Furniture Pooled

68

Figure 3-35 Estimated 2015 Asset Valuation – Equipment, Furniture & Fixtures Total: $6.5 million

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3.7.3 Asset Useful Life – Equipment, Furniture & Fixtures The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

3.7.4 Investment in Equipment, Furniture & Fixtures In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s equipment assets. Figure 3-36 Investment in Equipment, Furniture & Fixtures by Installation Year Based on 2015 Replacement Cost

Table 3-21 Asset Useful Life in Years – Equipment, Furniture & Fixtures


Equipment

Defibrillators / Stretchers 7 Exhibit Components 5

Library Books 7 Mattress / Beds 10

Medical 10 Operational 10

Other 10 Office Equipment 5 Office Furniture 5

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3.7.5 Useful Life Consumption In this section, we detail the extent to which each asset class has consumed its useful life based on the above, established useful life standards. Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-37 illustrates the useful life consumption distribution for the County’s equipment. Figure 3-37 Remaining Useful Life – Equipment, Furniture & Fixtures

Based on age data, nearly 25% of the County’s equipment, furniture & fixture assets are in operation beyond their useful life. Further, an additional 50%, with a replacement value of $3.2 million will reach the end of their useful life in the next five years.

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3.7.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s equipment, furniture & fixtures. In the absence of observed condition data, age was used to approximate the condition of the assets. Figure 3-38 Asset Condition – Equipment, Furniture & Fixtures Source: Age-based Data

Just over 55% of the County’s equipment, furniture & fixtures are in poor to very poor condition, with a replacement valuation of approximately $3.7 million.

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3.7.7 Forecasting Replacement Needs In the following sections, we illustrate the short, medium and long-term infrastructure spending requirements (replacement only) for the County’s Equipment assets. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-39 Forecasting Replacement Needs: Equipment

The County has an existing backlog of needs related to its equipment class totaling $931,000. This represents the immediate investment needs. Further, based on age data, the County will need to invest an additional $3.4 million in its furniture & fixtures group. Library books account for $1.8 million. The annual requirements for the County’s equipment class totals $934,000. This is the amount the County should allocate annually to meet replacement needs as they arise and prevent capital asset related backlogs.

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3.8 Technology & Communication 3.8.1 Asset Inventory Table 3-22 details Bruce County’s technology & communication assets.


Table 3-22 Asset Inventory – Technology & communication



Hardware Pooled Other Pooled

Peripherals Pooled Radio Equipment Pooled

Software Pooled Telephone Equipment Pooled

Table 3-23 Asset Valuation – Technology & Communication



Hardware CPI Monthly (ON) Other CPI Monthly (ON)

Peripherals CPI Monthly (ON) Radio Equipment CPI Monthly (ON)

Software CPI Monthly (ON) Telephone Equipment CPI Monthly (ON)

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Figure 3-40 Estimated 2016 Asset Valuation – Technology & Communication Total: $3.1 million

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3.8.3 Asset Useful Life – Technology & Communication The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

3.8.4 Investment in Technology & Communication In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s technology & communication assets. Figure 3-41 Investment in Technology & communication by Installation Year based on 2015 replacement cost

Table 3-24 Asset Useful Life in Years – Technology & Communication



Hardware 5 Other 5

Peripherals 5 Radio Equipment 5

Software 4 Telephone Equipment 5

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3.8.5 Useful Life Consumption In this section, we detail the extent to which each asset class has consumed its useful life based on the above, established useful life standards. Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-42 illustrates the useful life consumption distribution for the County’s technology & communication. Figure 3-42 Remaining Useful Life – Technology & Communication

More than 30% of the County’s technology & communications assets are in service beyond their useful life. Further, 35% of the assets, with an estimated replacement value of $1.1 million will see their useful life expire within the next two years.

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3.8.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s Technology & communication. In the absence of observed condition data, age was used to approximate the condition of the assets. Figure 3-43 Asset Condition – Technology & Communication Source: Age-based Data

More than 60% of the County’s technology & communication assets with a replacement valuation of approximately $2 million are in poor to very poor condition. Less than 30% of its assets are in good to very good condition.

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3.8.7 Forecasting Replacement Needs In the following sections, we illustrate the short-, medium- and long-term infrastructure spending requirements (replacement only) for the County’s Technology & communication assets. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-44 Forecasting Replacement Needs: Technology & Communication

The County has an existing backlog of $743,000 associated with its technology & communication assets. In addition, the County will need to invest $2.37 million over the next five years to meets its short-term replacement needs. The annual requirements needed to sustain the County’s technology & communications assets total $667,000. This is the amount that should be allocated annually to ensure backlogs are not accumulated and that replacement needs are met as they arise.

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Trail Programs

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3.9 Trail Programs 3.9.1 Asset Inventory Table 3-25 details Bruce County’s trail programs assets.


Table 3-25 Asset Inventory – Trail Programs


Trail Programs

Bridges for Recreation 3 CN Trail 80 km Fencing Pooled Signs Pooled

Table 3-26 Asset Valuation – Trail Programs


Trail Programs

Bridges for Recreation CPI Monthly (ON)

CN Trail $15,000/km

Fencing CPI Monthly (ON)

Signs CPI Monthly (ON)

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Figure 3-45 Estimated 2016 Asset Valuation – Trail Programs Total: $1.8 million

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3.9.3 Asset Useful Life – Trail Programs The useful life indicated for the asset types below was assigned by the County and obtained from the County’s accounting data as maintained in the CityWide® Tangible Asset module.

3.9.4 Investment in Trail Programs In this section, we provide the installation profile and asset life consumption rate using in-service data obtained from CityWide® Tangible Assets. Together, these graphs can illustrate infrastructure investment trends and upcoming needs at Bruce County. The chart below illustrates the level of investment in Bruce County’s trail programs assets. Figure 3-46 Investment in Trail Programs by Installation Year based on 2015 replacement cost

Table 3-27 Asset Useful Life in Years – Trail programs


Trail programs

Bridges for Recreation 25

CN Trail 20 Fencing 25 Signs 10/20

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3.9.5 Useful Life Consumption In this section, we detail the extent to which each asset class has consumed its useful life based on the above, established useful life standards. Understanding the consumption rate of assets based on industry established useful life measures provides a more complete profile of the state of a community’s infrastructure. Figure 3-47 illustrates the useful life consumption distribution for the County’s trail programs. Figure 3-47 Remaining Useful Life – Trail Programs

More than 70% of the County’s trail programs will expire within the next 10 years. Approximately 30% will remain functional, based on age data and established useful life, beyond 10 years.

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3.9.6 Current Asset Condition Using replacement cost, in this section we summarize the condition of the County’s Trail programs. In the absence of observed condition data, age was used to approximate the condition of the assets. Figure 3-48 Asset Condition – Trail Programs Source: Age-based Data

More than half of the County’s trail programs assets are in poor condition, with an estimated replacement value of $958,000. The remaining assets are in fair to very good condition. Currently, none of the County’s trail program assets are in very poor condition.

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3.9.7 Forecasting Replacement Needs In the following sections, we illustrate the short, medium and long-term infrastructure spending requirements (replacement only) for the County’s Trail programs assets. The backlog represents the immediate replacement needs that were deferred over previous years or decades. Figure 3-49 Forecasting Replacement Needs: Trail Programs

While the County does not have any backlog associated with its trail programs assets, it will see approximately $958,000 in replacement needs in the next four years associated with its CN Trail. The annual requirement that the County should allocate each year for its trail programs total $85,000. This is the amount required to ensure that the County meets its replacement needs for its trail programs assets and no backlogs are accumulated.

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4. Levels of Service The two primary risks to a County’s financial sustainability are the total lifecycle costs of infrastructure, and establishing levels of service (LOS) that exceed its financial capacity. In this regard, municipalities face a choice: overpromise and underdeliver; underpromise and overdeliver; or promise only that which can be delivered efficiently without placing inequitable burden on taxpayers. In general, there is often a trade-off between political expedience and judicious, long-term fiscal stewardship. Developing realistic LOS using meaningful key performance indicators (KPIs) can be instrumental in managing citizen expectations, identifying areas requiring higher investments, driving organizational performance and securing the highest value for money from public assets. However, municipalities face diminishing returns with greater granularity in their LOS and KPI framework. That is, the objective should be to track only those KPIs that are relevant and insightful and reflect the priorities of the County. 4.1 Guiding Principles for Developing Levels of Service Beyond meeting regulatory requirements, levels of service established should support the intended purpose of the asset and its anticipated impact on the community and the County. LOS generally have an overarching corporate description, a customer oriented description, and a technical measurement. Many types of LOS, e.g., availability, reliability, safety, responsiveness and cost effectiveness, are applicable across all service areas in a County. The following levels of service categories are established as guiding principles for the LOS that each service area in Bruce County should strive to provide internally to the County and to residents/customers. These are derived from the Town of Whitby’s Guide to Developing Service Area Asset Management Plans.

Available: Services of sufficient capacity are convenient and accessible to the entire community

Cost Effective: Services are provided at the lowest possible cost for both current and future customers, for a required level of service, and are affordable

Reliable: Services are predictable and continuous Responsive: Opportunities for community involvement in decision making are

provided; and customers are treated fairly and consistently, within acceptable timeframes, demonstrating respect, empathy and integrity

Safe: Services are delivered such that they minimize health, safety and security risks

Suitable: Services are suitable for the intended function (fit for purpose) Sustainable: Services preserve and protect the natural and heritage

environment. While the above categories provide broad strategic direction to council and staff, specific and measurable KPIs related to each LOS category are needed to ensure the

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County remains steadfast in its pursuit of delivering the highest value for money to various internal and external stakeholders. 4.2 Key Performance Indicators and Targets In this section, we identify industry standard KPIs that the County can incorporate into its performance measurement and for tracking its progress over future iterations of its AMPs. The County should develop appropriate and achievable targets that reflect evolving demand on infrastructure, its fiscal capacity and the overall corporate objectives. Table 4-1 Key Performance Indicators (KPIs) – Road Network and Bridges & Culverts

Level KPI (Reported Annually)

Strategic

Percentage of total reinvestment compared to asset replacement value

Completion of strategic plan objectives (related to right-of-way)

Financial Indicators

Annual revenues compared to annual expenditures Annual replacement value depreciation compared to annual

expenditures Cost per capita for roads, and bridges & culverts Maintenance cost per square metre Revenue required to maintain annual network growth Total cost of borrowing vs. total cost of service

Tactical

Overall Bridge Condition Index (BCI) as a percentage of desired BCI Percentage of road network rehabilitated/reconstructed Percentage of paved road lane km rated as poor to very poor Percentage of bridges and large culverts rated as poor to very poor Percentage of asset class value spent on O&M Percentage of signage that pass reflectivity test. The remaining

should be replaced

Operational Indicators

Percentage of roads inspected within the last five years Percentage of bridges and large culverts inspected within the last

two years Operating costs for paved lane per km Operating costs for bridge and large culverts per square metre Percentage of customer requests with a 24-hour response rate

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Table 4-2 Key Performance Indicators (KPIs) – Buildings & Facilities


Strategic

Percentage of total reinvestment compared to asset replacement value

Completion of strategic plan objectives (related buildings and facilities)



expenditures Revenue required to meet growth related demand Repair and maintenance costs per square metre Energy, utility and water cost per square metre

Tactical

Percentage of component value replaced Overall facility condition index as a percentage of desired condition

index Annual adjustment in condition indexes Annual percentage of new facilities (square metre) Percent of facilities rated poor or critical Percentage of facilities replacement value spent on operations and

maintenance Increase facility utilization rate by [x] percent by 2020. 𝑈𝑡𝑖𝑙𝑖𝑧𝑎𝑡𝑖𝑜𝑛 𝑅𝑎𝑡𝑒 =

𝑂𝑐𝑐𝑢𝑝𝑖𝑒𝑑 𝑆𝑝𝑎𝑐𝑒

𝐹𝑎𝑐𝑖𝑙𝑖𝑡𝑦 𝑈𝑠𝑎𝑏𝑙𝑒 𝐴𝑟𝑒𝑎


[x] sq.ft. of facilities per full-time employee (or equivalent), i.e., maintenance staff

Percentage of facilities inspected within the last five years Number/type of service requests Percentage of customer requests responded to within 24 hours

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Table 4-3 Key Performance Indicators (KPIs) – Fleet (Rolling Stock)


Strategic Percentage of total reinvestment compared to asset replacement

value Completion of strategic plan objectives



expenditures Cost per capita for roads, and bridges & culverts Maintenance cost per square metre Revenue required to maintain annual network growth Total cost of borrowing vs. total cost of service

Tactical

Percentage of all vehicles replaced Average age of fleet vehicles Percent of vehicles rated poor or critical Percentage of fleet replacement value spent on operations and

maintenance


Average downtime per fleet category Average utilization per fleet category and/or each vehicle Ratio of preventative maintenance repairs vs. reactive repairs Percent of vehicles that received preventative maintenance Number/type of service requests Percentage of customer requests responded to within 24 hours

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Table 4-4 Key Performance Indicators (KPIs) – Parks & Trails


Strategic Percentage of total reinvestment compared to asset replacement

value Completion of strategic plan objectives



expenditures Cost per capita for supplying land improvements/trails, etc. Maintenance cost per square metre

Tactical

Overall condition index as a percentage of desired condition index Annual adjustment in condition indexes Percent of trails assets infrastructure rated poor or very poor Percentage of replacement value spent on operations and

maintenance


Percentage of pedestrian bridges in trails inspected within the last two years

Number/type of service requests Percentage of customer requests responded to within 24 hours Pedestrian and vehicular control gates are secured and in good

working order Trails are free of overhead and tripping hazards, with no large

irregularities, holes, mounds, low branches, ponding water or large ruts in trail surface.

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4.3 Future Performance In addition to the financial capacity, and legislative requirements, e.g., Safe Drinking Water Act, the Minimum Maintenance Standards for municipal highways, building codes and the Accessibility for Ontarians with Disability Act, many factors, internal and external, can influence the establishment of LOS and their associated KPIs, both target and actual, including the County’s overarching mission as an organization, the current state of its infrastructure, and the County’s financial capacity. 1. Strategic Objectives and Corporate Goals The County’s long-term direction is outlined in its corporate and strategic plans. This direction will dictate the types of services it aims to deliver to its residents and the quality of those services. These high level goals are vital in identifying strategic (long-term) infrastructure priorities and as a result, the investments needed to produce desired levels of service. 2. State of the Infrastructure The current state of capital assets will determine the quality of service the County can deliver to its residents. As such, levels of service should reflect the existing capacity of assets to deliver those services, and may vary (increase) with planned maintenance, rehabilitation or replacement activities and timelines. 3. Community Expectations The general public will often have qualitative and quantitative opinions and insights regarding the levels of service a particular asset should deliver, e.g., what a road in ‘good’ condition should look like or the travel time between destinations. The public should be consulted in establishing LOS; however, the discussions should be centered on clearly outlining the lifecycle costs associated with delivering any improvements in LOS. 4. Economic Trends Macroeconomic trends will have a direct impact on the LOS for most infrastructure services. Fuel costs, fluctuations in interest rates, and the purchasing power of the Canadian dollar can impede or facilitate any planned growth in infrastructure services. 5. Demographic Changes The type of residents that dominate a County can also serve as infrastructure demand drivers, and as a result, can change how a County allocates its resources (e.g., an aging population may require diversion of resources from parks and sports facilities to additional wellbeing centers). Population growth is also a significant demand driver for existing assets (lowering LOS), and may require the County to construct new infrastructure to parallel community expectations. 6. Environmental Change Forecasting for infrastructure needs based on climate change remains an imprecise science. However, broader environmental and weather patterns have a direct impact on the reliability of critical infrastructure services.

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4.4 Monitoring, Updating and Actions The County should collect data on its current performance against the KPIs listed and establish targets that reflect the current fiscal capacity of the County, its corporate and strategic goals, and as feasible, changes in demographics that may place additional demand on its various asset classes. For some asset classes, e.g., minor equipment, furniture, etc. cursory levels of service and their respective KPIs will suffice. For major infrastructure classes, detailed technical and customer-oriented KPIs can be critical. Once this data is collected and targets are established, the progress of the County should be tracked annually.

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5. Asset Management Strategies Objective: To outline and establish a set of planned actions, based on best practice, that will enable the assets to provide a desired and sustainable level of service, while managing risk, at the lowest life cycle cost. The asset management strategy will develop an implementation process that can be applied to the needs identification and prioritization of renewal, rehabilitation, and maintenance activities. This will assist in the production of a 10-year plan, including growth projections, to ensure the best overall health and performance of the County’s infrastructure. This section includes an overview of condition assessment; the life cycle interventions required; and prioritization techniques, including risk, to determine which priority projects should move forward into the budget first. 5.1 Non-Infrastructure Solutions and Requirements The County should explore, as requested through the provincial requirements, which non-infrastructure solutions should be incorporated into the budgets for its infrastructure services. Non-Infrastructure solutions are such items as studies, policies, condition assessments, consultation exercises, etc., that could potentially extend the life of assets or lower total asset program costs in the future without a direct investment into the infrastructure. Typical solutions for a County include linking the asset management plan to the strategic plan, growth and demand management studies, infrastructure master plans, better integrated infrastructure and land use planning, public consultation on levels of service, and condition assessment programs. As part of future asset management plans, a review of these requirements should take place, and a portion of the capital budget should be dedicated for these items in each programs budget. It is recommended, under this category of solutions, that the County should develop and implement holistic condition assessment programs for all asset classes. This will advance the understanding of infrastructure needs, improve budget prioritization methodologies, and provide clearer path of what is required to achieve sustainable infrastructure programs. 5.2 Condition Assessment Programs The foundation of good asset management practice is based on having comprehensive and reliable information on the current condition of the infrastructure. Municipalities need to have a clear understanding regarding performance and condition of their assets, as all management decisions regarding future expenditures and field activities

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should be based on this knowledge. An incomplete understanding about an asset may lead to its premature failure or premature replacement. Some benefits of holistic condition assessment programs within the overall asset management process are listed below:

Understanding of overall network condition leads to better management practices Allows for the establishment of rehabilitation programs Prevents future failures and provides liability protection Potential reduction in operation/maintenance costs Accurate current asset valuation Allows for the establishment of risk assessment programs Establishes proactive repair schedules and preventive maintenance programs Avoids unnecessary expenditures Extends asset service life therefore improving level of service Improves financial transparency and accountability Enables accurate asset reporting which, in turn, enables better decision making

Condition assessment can involve different forms of analysis such as subjective opinion, mathematical models, or variations thereof, and can be completed through a very detailed or very cursory approach. When establishing the condition assessment of an entire asset class, the cursory approach (metrics such as good, fair, poor, very poor) is used. This will be a less expensive approach when applied to thousands of assets, yet will still provide up to date information, and will allow for detailed assessment or follow up inspections on those assets captured as poor or critical condition later. 5.2.1 Pavement Network Inspections Typical industry pavement inspections are performed by consulting firms using specialised assessment vehicles equipped with various electronic sensors and data capture equipment. The vehicles will drive the entire road network and typically collect two different types of inspection data – surface distress data and roughness data. Surface distress data involves the collection of multiple industry standard surface distresses, which are captured either electronically, using sensing detection equipment mounted on the van, or visually, by the van's inspection crew. Roughness data capture involves the measurement of the roughness of the road, measured by lasers that are mounted on the inspection van's bumper, calibrated to an international roughness index. Another option for a cursory level of condition assessment is for municipal road crews to perform simple windshield surveys as part of their regular patrol. Many municipalities have created data collection inspection forms to assist this process and to standardize what presence of defects would constitute a good, fair, poor, or critical score. Lacking

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any other data for the complete road network, this can still be seen as a good method and will assist greatly with the overall management of the road network. It is recommended that the County establish a pavement condition assessment program and that a portion of capital funding is dedicated to this. 5.2.2 Bridges & Culverts Inspections Ontario municipalities are mandated by the Ministry of Transportation to inspect all structures that have a span of 3 metres or more, according to the OSIM (Ontario Structure Inspection Manual). At present, in the County, there are 83 bridges and 74 culverts that meet this criterion. Structure inspections must be performed by, or under the guidance of, a structural engineer, must be performed on a biennial basis (once every two years), and include such information as structure type, number of spans, span lengths, other key attribute data, detailed photo images, and structure element by element inspection, rating and recommendations for repair, rehabilitation, and replacement. The best approach to develop a 10-year needs list for the County’s structure portfolio would be to have the structural engineer who performs the inspections to develop a maintenance requirements report, and rehabilitation and replacement requirements report as part of the overall assignment. In addition to refining the overall needs requirements, the structural engineer should identify those structures that will require more detailed investigations and non-destructive testing techniques. Examples of these investigations are:

Detailed deck condition survey Non-destructive delamination survey of asphalt covered decks Substructure condition survey Detailed coating condition survey Underwater investigation Fatigue investigation Structure evaluation

Through the OSIM recommendations and additional detailed investigations, a 10-year needs list will be developed for the County’s bridges.

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5.2.3 Buildings & Facilities The most popular and practical type of buildings and facility assessment involves qualified groups of trained industry professionals (engineers or architects) performing an analysis of the condition of a group of facilities, and their components, that may vary in terms of age, design, construction methods, and materials. This analysis can be done by walk-through inspection, mathematical modeling, or a combination of both. But the most accurate way of determining the condition requires a walk-through to collect baseline data. The following five asset classifications are typically inspected:

Site Components – property around the facility and includes the outdoor components such as utilities, signs, stairways, walkways, parking lots, fencing, courtyards and landscaping.

Structural Components – physical components such as the foundations, walls, doors, windows, roofs.

Electrical Components – all components that use or conduct electricity such as wiring, lighting, electric heaters, and fire alarm systems

Mechanical Components – components that convey and utilize all non-electrical utilities within a facility such as gas pipes, furnaces, boilers, plumbing, ventilation, and fire extinguishing systems

Vertical movement – components used for moving people between floors of buildings such as elevators, escalators and stair lifts.

Once collected this type of information can be uploaded into the CityWide®, the County’s asset management and asset registry software database in order for short- and long-term repair, rehabilitation and replacement reports to be generated to assist with programming the short- and long-term maintenance and capital budgets. It is recommended that the County establish a facilities condition assessment program and that a portion of capital funding is dedicated to this. 5.2.3 Fleet The typical approach to optimizing the maintenance expenditures of a corporate fleet of vehicles is through routine vehicle inspections, routine vehicle servicing, and an established routine preventative maintenance program. Most, if not all, makes and models of vehicles are supplied with maintenance manuals that define the appropriate schedules and routines for typical maintenance and servicing and also more detailed restoration or rehabilitation protocols. The primary goal of good vehicle maintenance is to avoid or mitigate the consequence of failure of equipment or parts. An established preventative maintenance program serves to ensure this, as it will consist of scheduled inspections and follow up repairs of vehicles and equipment in order to decrease breakdowns and excessive downtimes.

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A good preventative maintenance program will include partial or complete overhauls of equipment at specific periods, including oil changes, lubrications, fluid changes and so on. In addition, workers can record equipment or part deterioration so they can schedule to replace or repair worn parts before they fail. The ideal preventative maintenance program would move further and further away from reactive repairs and instead towards the prevention of all equipment failure before it occurs. It is recommended that a preventative maintenance routine is defined and established for all fleet vehicles and that a software application such as Citywide is utilized for the overall management of the program.

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5.3 Lifecycle Framework Strategic interventions throughout the lifecycle of an asset are critical in securing the highest total value for money at the lowest cost. They can extend an asset’s life, maintain levels of service and reduce impending replacement needs (and the associated backlogs). The value is even greater when a strategic lifecycle framework is developed for an entire asset class or network. 5.3.1 Paved Roads The following diagrams, extracted from CityWide®, depict the typical deterioration of HCB/LCB rural and urban roads, and the points of intervention at key stages throughout the lifecycle of the asset. Figure 5-1 Deterioration Profile and Lifecycle Strategy– HCB/LCB Rural If no intervention activity is applied, a typical HCB/LCB rural road will see it condition reach its failure state within 15 years. However, with a microresurfacing implemented in Year 7, the condition of the surface can be elevated to its original state. As the asset ages, the type of lifecycle activity will vary. The table below depicts the County’s detailed lifecycle strategies for its HCB/LCB rural strategy and the year of intervention.

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Similar to HCB/LCB rural, the figure below depicts the deterioration of an HCB/LCB urban road and the impact of strategic lifecycle events and activities. With no intervention, the road will reach its failure state by year 18. With a mill and hotmix overlay applied in year 17, however, the road’s condition can be rehabilitated to its original state. Figure 5-2 Deterioration Profile and Lifecycle Strategy– HCB/LCB Urban

Table 5-1 Lifecycle Strategies – HCB/LCB Rural Asset Lifecycle Event Cost Year

HCB/LCB Rural

Micro Resurfacing $3.96 7 Micro Resurfacing $3.96 15

Mill & Hotmix Overlay $17.55 25 Recycle $21.13 40

Mill & Hotmix Overlay $17.55 55 Micro Resurfacing $3.96 65

Reconstruction User-Defined 75

Table 5-2 Lifecycle Strategies – HCB/LCB Urban

Asset Lifecycle Event Cost Year

HCB/LCB Rural Mill & Hotmix Overlay $17.55 17 Mill & Hotmix Overlay $17.55 35

Reconstruction User-Defined 50

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The windows or thresholds for when certain work activities should be applied to also coincide approximately with the condition state of the asset as shown below: Table 5-3 Asset Condition and Related Work Activity: Paved Roads

Condition Condition Range Work Activity

Excellent condition (Maintenance only phase) 100-76 maintenance only

Good Condition (Preventative maintenance phase) 75 - 51

crack sealing emulsions

Fair Condition (Rehabilitation phase) 50 -26

resurface - mill & pave resurface - asphalt overlay single & double surface

treatment (for rural roads)

Poor Condition (Reconstruction phase) 25 - 1

reconstruct - pulverize and pave reconstruct - full surface and

base reconstruction

Critical Condition (Reconstruction phase)

0

critical includes assets beyond their useful lives which make up the backlog. They require the same interventions as the “poor” category above.

With future updates of this Asset Management Strategy, the County may wish to review the above condition ranges and thresholds for when certain types of work activity occur, and adjust to better suit the County’s work program. Also note: when adjusting these thresholds, it actually adjusts the level of service provided and ultimately changes the amount of money required. These threshold and condition ranges can be easily updated with the CityWide® software suite and an updated financial analysis can be calculated. These adjustments will be an important component of future asset management plans, as the province requires each County to present various management options within the financing plan.

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5.3.2 Bridges & Culverts (greater than 3m span) The best approach to develop a 10-year needs list for the County’s bridge structure portfolio would be to have the structural engineer who performs the inspections to develop a maintenance requirements report, a rehabilitation and replacement requirements report and identify additional detailed inspections as required. This approach is described in more detail within the “Bridges & Culverts (greater than 3m) Inspections” section above. 5.3.3 Buildings & Facilities The best approach to develop a 10-year needs list for the County’s buildings and facilities portfolio would be to have the engineers or architects who perform the facility inspections to also develop a complete portfolio maintenance requirements report and rehabilitation and replacement requirements report, and also identify additional detailed inspections and follow up studies as required. This may be performed as a separate assignment once all individual facility audits/inspections are complete. If the inspection data is housed or uploaded into the CityWide software, then these reports can be produced automatically from the system. The above reports could be considered the beginning of a 10-year maintenance and capital plan, however, within the facilities industry there are other key factors that should be considered to determine over all priorities and future expenditures. Some examples would be functional / legislative requirements, energy conservation programs and upgrades, customer complaints and health and safety concerns, and also customer expectations balanced with willingness to pay initiatives. It is recommended that the County establish a prioritization framework for the facilities asset class that incorporates the key components outlined above. 5.3.3 Trail Programs The best approach to develop a 10-year needs list for the County’s trails portfolio would be to have the engineers or landscape architects who perform the trails and parks inspections to also develop a complete portfolio maintenance requirements report and rehabilitation and replacement requirements report, and identify additional detailed inspections and follow up studies as required. This may be performed as a separate assignment once all individual park audits and inspections are complete. It is recommended that the County establish a prioritization framework for the trails asset class.

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5.3.4 Fleet and Vehicles The best approach to develop a 10-year needs list for the County’s fleet and vehicle portfolio would first be through a defined preventative maintenance program as described in the previous section, and secondly, through an optimized life cycle vehicle replacement schedule. As previously described, the preventative maintenance program would serve to determine budget requirements for operating and minor capital expenditures for part renewal and major refurbishments and rehabilitations. An optimized vehicle replacement program will ensure a vehicle is replaced at the correct point in time in order to minimize overall cost of ownership, minimize costly repairs and downtime, while maximizing potential re-sale value. There is significant benchmarking information available within the fleet industry in regards to vehicle life cycles which can be used to assist in this process. Once appropriate replacement schedules are established the short and long term budgets can be funded accordingly. There are, of course, functional aspects of fleet management that should also be examined in further detail as part of the long-term management plan, such as fleet utilization and incorporating green fleet, etc.

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5.4 Growth and Demand Growth is a critical infrastructure demand driver for most infrastructure services. As such, the County must not only account for the lifecycle cost for its existing asset portfolio, but those of any anticipated and forecasted capital projects associated specifically with growth. Bruce County has had a relatively flat growth, increasing by 1.2% from its 2006 census, and well below provincial 5-year change of 5.7%. Figure 5-3 Bruce County’s Population Trend

In conjunction with raw population growth, the type of shift in demographics can also dictate how municipalities allocate their infrastructure investments. As the demographics change and the County assumes responsibility of new infrastructure, the level of strain on various critical and supplementary infrastructure services will shift to reflect the needs of the residents. Some services, e.g., open spaces, are particularly vulnerable to the dual stress of overuse and underfunding.

66,102

65,349

62,628

65,042

2011200620011996

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4.5 Project Prioritization Generally, infrastructure needs exceed municipal capacity. As such, local governments rely heavily on provincial and federal programs and grants to finance important capital projects. Fund scarcity means projects and investments must be carefully selected based on the state of infrastructure, economic development goals, and the needs of an evolving and growing community. These factors, along with social and environmental considerations will form the basis of a robust risk management framework. From an asset management perspective, risk is a function of:

the consequences of failure (e.g., the negative economic, financial, and social consequences of an asset in the event of a failure); and

the probability of failure (e.g., how likely is the asset to fail in the short- or long-

term). The consequences of failure are typically reflective of:

An asset’s importance in an overall system For example, the failure of an individual computer workstation for which there are readily available substitutes is much less consequential and detrimental than the failure of a network server or telephone exchange system.

The criticality of the function performed

For example, a mechanical failure on a piece road construction equipment may delay the progress of a project, but a mechanical failure on a fire pumper truck may lead to immediate life safety concerns for fire fighters, and the public, as well as significant property damage.

The exposure of the public and/or staff to injury or loss of life

For example, a single sidewalk asset may demand little consideration and carry minimum importance to Bruce County’s overall pedestrian network and performs a modest function. However, members of the public interact directly with the asset daily and are exposed to potential injury due to any trip hazards or other structural deficiencies that may exist.

The probability of failure is generally a function of an asset’s physical condition, which is heavily influenced by the asset’s age and the amount of investment that has been made in the maintenance and renewal of the asset throughout its life. Risk mitigation is traditionally thought of in terms of safety and liability factors. In asset management, the definition of risk should heavily emphasize these factors but should be expanded to consider the risks to the County’s ability to deliver targeted levels of service

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The impact that actions (or inaction) on one asset will have on other related assets

The opportunities for economic efficiency (realized or lost) relative to the actions taken

The figure below illustrates a range of risk factors and describes, in general terms, how the consequences of asset failure can be evaluated relative to each factor. The weightings placed on the various factors should reflect the criticality of each asset and the degree to which the public is directly exposed to risk. Figure 5-4 Risk Factors and Consequence of Failure

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5.6 Risk Matrices Using the logic above, a risk matrix will illustrate each asset’s overall risk, determined by multiplying the probability of failure (Pof) scores with the consequence of failure (Cof) score, as illustrated in the table below. This can be completed as a holistic exercise against any data set by determining which factors (or attributes) are available and will contribute to the Pof or Cof of an asset. The following diagram (known as a bowtie model in the risk industry) illustrates this concept. The probability of failure is increased as more and more factors collude to cause asset failure. Figure 5-5 Bowtie Risk Model

The risk matrices that follow categorize the County’s nine asset classes as analyzed in this document based on their consequence of failure and the likelihood of failure events. The first risk matrix illustrates the distribution of all assets. Figure 5-6 Risk Matrix – All Asset Classes

FAILURE EVENT

PROBABILITY OF FAILURE Increased by fundamental and

immediate causes such as age, or observed condition

CONSEQUENCES OF FAILURE Includes immediate and long-term economic, social and environmental

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Figure 5-7 Aggregate Risk Matrix – Road Network

Figure 5-8 Risk Matrix – Bridges & Culverts

110

Figure 5-9 Risk Matrix – Social Housing

Figure 5-10 Risk Matrix – Buildings

111

Figure 5-11 Risk Matrix – Land Improvement

Figure 5-12 Risk Matrix – Machinery & Vehicles

112

Figure 5-13 Risk Matrix – Equipment, Furniture & Fixtures

Figure 5-14 Risk Matrix – Technology & Communication

113

Figure 5-15 Risk Matrix – Trail Programs

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6. Financial Strategy

6.1 General overview of financial plan requirements In order for an AMP to be effectively put into action, it must be integrated with financial planning and long-term budgeting. The development of a comprehensive financial plan will allow Bruce County to identify the financial resources required for sustainable asset management based on existing asset inventories, desired levels of service, and projected growth requirements. The following pyramid depicts the various cost elements and resulting funding levels that should be incorporated into AMPs that are based on best practices. Figure 6-1 Cost Elements

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This report develops such a financial plan by presenting several scenarios for consideration and culminating with final recommendations. As outlined below, the scenarios presented model different combinations of the following components:

1. the financial requirements (as documented in the SOTI section of this report) for: existing assets existing service levels requirements of contemplated changes in service levels (none identified for

this plan) requirements of anticipated growth (none identified for this plan)

use of traditional sources of municipal funds:

tax levies user fees reserves debt development charges

2. use of non-traditional sources of municipal funds:

reallocated budgets partnerships procurement methods

3. use of senior government funds:

gas tax grants (not included in this plan due to Provincial requirements for firm

commitments) If the financial plan component of an AMP results in a funding shortfall, the Province requires the inclusion of a specific plan as to how the impact of the shortfall will be managed. In determining the legitimacy of a funding shortfall, the Province may evaluate a County’s approach to the following:

1. in order to reduce financial requirements, consideration has been given to revising service levels downward

2. all asset management and financial strategies have been considered. For example: if a zero debt policy is in place, is it warranted? If not, the use of debt

should be considered. do user fees reflect the cost of the applicable service? If not, increased user

fees should be considered. This AMP includes recommendations that avoid long-term funding deficits.

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6.2 Current Financial Profile 6.2.1 Funding objective We have developed scenarios that would enable Bruce County to achieve full funding within 5 to 20 years for its tax funded assets including: Road Network; Bridges & Culverts; Equipment, Furniture & Fixtures; Buildings; Land Improvements; Machinery & vehicles; Technology & Communications; Trails Program; Social Housing. For each scenario developed we have included strategies, where applicable, regarding the use of tax revenues, user fees, reserves and debt. 6.2.2 Current funding position Tables 6-1 and 6-2 outline, by asset category, Bruce County’s average annual asset investment requirements, current funding positions, and funding increases required to achieve full funding for its park services and other tax-funded assets. The average annual requirements are based only the anticipated replacement needs and do not include other lifecycle activities.

Table 6-1. Infrastructure Requirements & Current Funding Available for Existing Assets

Asset Category

Average Annual

Investment Required

2016 Annual Funding Available Annual Deficit/ Surplus Taxes Gas Tax Taxes to

Reserves

Total Funding Available

Bridges & Culverts 4,181,000 0 0 1,544,000 1,544,000 2,637,000

Buildings 2,760,000 430,000 0 371,000 801,000 1,959,000

Equipment, Furniture & Fixtures 934,000 515,000 0 68,000 583,000 351,000

Land Improvements 350,000 0 0 0 0 350,000

Vehicles & Machinery 1,548,000 750,000 0 46,000 796,000 752,000

Road Networks 10,019,000 3,430,000 1,967,000 0 5,397,000 4,622,000

Technology & Communications 667,000 674,000 0 110,000 784,000 -117,000

Trails Program 85,000 19,000 0 0 19,000 66,000

Social Housing 3,187,000 6,000 0 1,904,000 1,910,000 1,277,000

Total 23,731,000 5,824,000 1,967,000 4,043,000 11,834,000 11,897,000

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6.3 Recommendations for full funding The average annual investment requirement for the above categories is $23,731,000. Annual revenue currently allocated to these assets for capital purposes is $11,834,000 leaving an annual deficit of $11,897,000. To put it another way, these infrastructure categories are currently funded at 49.9% of their long-term requirements. In 2016, Bruce County has annual tax revenues of $41,902,000. As illustrated in Table 2, without consideration of any other sources of revenue, full funding would require the following tax change over time:

Table 6-2 Tax Change Required for Full Funding

Asset Category Tax Change Required for Full Funding

Portion of Total Increase

Bridges & Culverts 6.3% 22%

Buildings 4.7% 16.5%

Equipment, Furniture & Fixtures 0.8% 3%

Land Improvements 0.8% 3%

Vehicles & Machinery 1.8% 6.5%

Road Networks 11.0% 39%

Technology & Communications -0.3% -1.0%

Trails Program 0.15% 0.5%

Social Housing 3.0% 10.5%

Total 28.25% 100% As illustrated in table 3, Bruce County’s debt payments for these asset categories will be decreasing by $248,000 from 2016 to 2021 (5 years) and by $2,697,000 from 2016 to 2026 (10 years). Although not shown in the table, debt payments will be decreasing by $3,265,000 from 2016 to 2031 (15 years) and by $3,888,000 from 2016 to 2036(20 years). Our recommendations include capturing those decreases in cost and allocating them to the infrastructure deficit outlined above.

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Table 6-3 outlines this concept and presents a number of options:

Table 6-3. Effect Of Reallocating Decreases In Debt Costs

Without Reallocation Of Decreasing Debt Costs With Reallocation Of Decreasing Debt Costs

5 Years 10 Years 15 Years 20 Years 5 Years 10 Years 15 Years 20 Years

Infrastructure Deficit As

Outlined In Table 1

11,897,000 11,897,000 11,897,000 11,897,000 11,897,000 11,897,000 11,897,000 11,897,000

Change In Debt Costs

N/A N/A N/A N/A -248,000 -2,697,000 -3,265,000 -3,888,000

Resulting Infrastructure

Deficit 11,897,000 11,897,000 11,897,000 11,897,000 11,649,000 9,200,000 8,632,000 8,009,000

Resulting Tax Increase Required:

Total Over Time 28.25% 28.25% 28.25% 28.25% 27.8% 21.9% 20.6% 19.1%

Annually 5.65% 2.83% 1.88% 1.41% 5.56% 2.19% 1.37% 0.96%

Considering all of the above information, we recommend the 15 year option in table 3 that includes the reallocations. This involves full funding being achieved over 15 years by:

1. when realized, reallocating the debt cost reductions of $3,265,000 to the infrastructure deficit as outlined above.2. increasing tax revenues by 1.37% each year for the next 15 years solely for the purpose of phasing in full funding

to the asset categories covered in this section of the AMP.3. continuing to allocate the gas tax revenue to the roads network category.4. increasing existing and future infrastructure budgets by the applicable inflation index on an annual basis in addition

to the deficit phase-in.

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Notes: 1. As in the past, periodic senior government infrastructure funding will most likely

be available during the phase-in period. By Provincial AMP rules, this periodicfunding cannot be incorporated into an AMP unless there are firm commitmentsin place. We have included OCIF formula based funding, if applicable, sincethis funding is a multi-year commitment.

2. We realize that raising tax revenues by the amounts recommended above forinfrastructure purposes will be very difficult to do. However, considering a longerphase-in window may have even greater consequences in terms ofinfrastructure failure.

Although this option achieves full funding on an annual basis in 15 years and provides financial sustainability over the period modeled (to 2050), the recommendations do require prioritizing capital projects to fit the resulting annual funding available. As of 2016, age based and observed condition data shows a pent up investment demand of nearly $41.2 million.

Figure 6-2 Backlog by Asset Class

Prioritizing future projects will require any age based data to be replaced by condition based data. Although our recommendations include no further use of debt, the results of the condition based analysis may require otherwise.

$260,136

$11,576,241

$12,754,444

$10,665,058

$251,840

$4,033,715

$931,968

$743,228

$0

Roads Network

Bridges & Culverts

Social Housing

Buildings

Land Improvements


Equipment, Furniture &…


Trail Programs

Backlogs

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6.4 Use of debt For reference purposes, Table 6-4 outlines the premium paid on a project if financed by debt. For example, a $1M project financed at 3.0%3 over 15 years would result in a 26% premium or $260,000 of increased costs due to interest payments. For simplicity, the table does not take into account the time value of money or the effect of inflation on delayed projects.

Table 6-4. Total Interest Paid as a % of Project Costs

Interest Rate Number of Years Financed

5 10 15 20 25 30

7.0% 22% 42% 65% 89% 115% 142%

6.5% 20% 39% 60% 82% 105% 130%

6.0% 19% 36% 54% 74% 96% 118%

5.5% 17% 33% 49% 67% 86% 106%

5.0% 15% 30% 45% 60% 77% 95%

4.5% 14% 26% 40% 54% 69% 84%

4.0% 12% 23% 35% 47% 60% 73%

3.5% 11% 20% 30% 41% 52% 63%

3.0% 9% 17% 26% 34% 44% 53%

2.5% 8% 14% 21% 28% 36% 43%

2.0% 6% 11% 17% 22% 28% 34%

1.5% 5% 8% 12% 16% 21% 25%

1.0% 3% 6% 8% 11% 14% 16%

0.5% 2% 3% 4% 5% 7% 8%

0.0% 0% 0% 0% 0% 0% 0%

It should be noted that current interest rates are near all-time lows. Sustainable funding models that include debt need to incorporate the risk of rising interest rates. The following graph shows where historical lending rates have been:

3 Current municipal Infrastructure Ontario rates for 15 year money is 2.3%.

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Figure 6-3 Historical Prime Business Interest Rates

0.00%2.00%4.00%6.00%8.00%

10.00%12.00%14.00%16.00%

1990 1995 2000 2005 2010

As illustrated in table 4, a change in 15 year rates from 3% to 6% would change the premium from 26% to 54%. Such a change would have a significant impact on a financial plan.

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Tables 6-5 and 6-6 outline how Bruce County has historically used debt for investing in the asset categories as listed. There is currently $27,118,000 of debt outstanding for the assets covered by this AMP and $3,888,000 of annual principal and interest payment commitments. These principal and interest payments are well within its provincially prescribed annual maximum of $12,713,000.

Table 6-5. Overview Of Use Of Debt

Asset Category Current Debt Outstanding

Use Of Debt In The Last Five Years 2012 2013 2014 2015 2016

Bridges & Culverts 0 0 0 0 0 0 Buildings 20,162,000 0 0 0 0 0

Equipment, Furniture & Fixtures 0 0 0 0 0 0

Land Improvements 0 0 0 0 0 0 Vehicles & Machinery 0 0 0 0 0 0

Road Networks 0 0 0 0 0 0 Technology &

Communications 0 0 0 0 0 0

Trails Program 0 0 0 0 0 0

Social Housing 6,956,000 0 0 2,032,000 0 0

Total Tax Funded 27,118,000 0 0 2,032,000 0 0

Table 6-6. Overview of Debt Costs

Asset Category Principal & Interest Payments In The Next Five Years

2016 2017 2018 2019 2020 2021 2026

Bridges & Culverts 0 0 0 0 0 0 0

Buildings 3,012,000 3,012,000 3,012,000 3,012,000 3,012,000 3,012,000 623,000

Equipment, Furniture & Fixtures 0 0 0 0 0 0 0

Land Improvements 0 0 0 0 0 0 0

Vehicles & Machinery 0 0 0 0 0 0 0

Road Networks 0 0 0 0 0 0 0

Technology & Communications 0 0 0 0 0 0 0

Trails Program 0 0 0 0 0 0 0

Social Housing 876,000 876,000 785,000 707,000 642,000 628,000 568,000

Total Tax Funded 3,888,000 3,888,000 3,797,000 3,719,000 3,654,000 3,640,000 1,191,000

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The revenue options outlined in this plan allow Bruce County to fully fund its long-term infrastructure requirements without further use of debt. However, as explained in section 7.3.2, the recommended condition rating analysis may require otherwise. 6.5 Use of reserves 6.5.1 Available reserves Reserves play a critical role in long-term financial planning. The benefits of having reserves available for infrastructure planning include:

the ability to stabilize tax rates when dealing with variable and sometimes uncontrollable factors

financing one-time or short-term investments accumulating the funding for significant future infrastructure investments managing the use of debt normalizing infrastructure funding requirements

By infrastructure category, Table 7 outlines the details of the reserves currently available to Bruce County.

Table 6-7. Summary of Reserves Available

Asset Category Balance at December 31, 2015

Bridges & Culverts 3,066,000

Buildings 3,277,000

Equipment, Furniture & Fixtures 770,000

Land Improvements 0

Vehicles & Machinery 458,000

Road Networks 3,892,000

Technology & Communications 1,041,000

Trails Program 45,000

Social Housing 2,014,000

Total Tax Funded 14,563,000

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There is considerable debate in the municipal sector as to the appropriate level of reserves that a municipality should have on hand. There is no clear guideline that has gained wide acceptance. Factors that municipalities should take into account when determining their capital reserve requirements include:

breadth of services provided age and condition of infrastructure use and level of debt economic conditions and outlook internal reserve and debt policies.

The reserves in table 10 are available for use by applicable asset categories during the phase-in period to full funding. This, coupled with Bruce County’s judicious use of debt in the past, allows the scenarios to assume that, if required, available reserves and debt capacity can be used for high priority and emergency infrastructure investments in the short to medium-term. 6.5.2 Recommendation As Bruce County updates it’s AMP and expands it to include other asset categories, we recommend that future planning should include determining what its long-term reserve balance requirements are and a plan to achieve such balances.

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7. Appendix: Infrastructure Report Card

Calculating the Star Rating for an Infrastructure Category The example below illustrates how we derived the weighted star rating for each infrastructure segment and category.

Infrastructure Category: Bridges & Culverts 1. Segment: Bridges

Bridges Star Rating = (% of Bridges Replacement Value in Very Good condition) x (5 stars) +(% of Bridges Replacement Value in Good condition) x (4 stars) +(% of Bridges Replacement Value in Fair condition) x (3 stars) +(% of Bridges Replacement Value in Poor condition) x (2 stars) +(% of Bridges Replacement Value in Very Poor condition) x (1 star)

2. Segment: Culverts

Culverts Star Rating = (% of Culverts Replacement Value in Very Good condition) x (5 stars) +(% of Culverts Replacement Value in Good condition) x (4 stars) +(% of Culverts Replacement Value in Fair condition) x (3 stars) +(% of Culverts Replacement Value in Poor condition) x (2 stars) +(% of Culverts Replacement Value in Very Poor condition) x (1 star)

Bridges & Culverts Category Star Rating =

(Bridges Star Rating) x (Bridges Replacement Value as a % of Category Replacement Value ) + (Culverts Star Rating) x (Culverts Replacement Value as a % of Category Replacement Value )

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Bruce County Infrastructure Report Card 2016

Category Asset Health

Financial Capacity

Comments

Road Network C D

Based on 2015 replacement cost, and a blend of age-based and observed data, just over 50% of the County’s total asset portfolio as analyzed in this AMP is in very good or good condition. More than 27% is in poor or very poor condition.

Approximately 19% of roads, comprising 27% of the county’s asset portfolio, are in poor to very poor condition. In addition, more than 40% of the county’s social housing assets, with a valuation of approximately $43 million, are in poor to very poor condition.

The average annual investment requirement for the County’s asset classes is $23,731,000. Annual revenue currently allocated to these assets for capital purposes is $11,834,000 leaving an annual deficit of $11,897,000. To put it another way, these infrastructure categories are currently funded at 49.9% of their long-term requirements.

The largest infrastructure deficit was found in the county’s road network class, totaling $4.6 million. None of the county’s asset classes are fully meeting their annual needs.

Bridges & Culverts

B F

Social Housing D+ D

Buildings C F

Land Improvements

C F


F D

Equipment, Furniture &

Fixtures D+ C


D A

Trail Programs C F

CUMULATIVE GRADE D

Road Network

Segment replacement value $110,231,508 27.7%

Segment ConditionLetter grade

Star ratingReplacement Value ($) in

given condition% of Assets in given

conditionWeighted, unadjusted

star rating

Very Good A 5 30,561,695.00 28% 1.39

Good B 4 20,423,981.00 19% 0.74

Fair C 3 38,525,717.00 35% 1.05

Poor D 2 5,635,665.00 5% 0.10

Very Poor F 1 15,084,450.00 14% 0.14

Totals 110,231,508.00 100% 3.41






star rating

Very Good A 5 49,786,655.00 17% 0.87

Good B 4 95,868,318.00 33% 1.33

Fair C 3 81,282,820.00 28% 0.85

Poor D 2 57,733,301.00 20% 0.40

Very Poor F 1 2,941,928.00 1% 0.01Totals 287,613,022.00 100% 3.46

3.4 C

Average annual investment required

Funding available

DeficitCategory star

ratingCategory letter

grade

$10,019,000 $5,397,000 $4,622,000

Average star rating

3. Overall Rating

Condition vs Performance star rating Funding vs. Need star rating Overall letter grade

3.4 1.9

2.6 D+

2. Funding vs. NeedFunding percentage

53.9%

1.9 D

Road Base, Signs & Traffic Signals 2.5

Category star rating

Category letter grade

Segment adjusted star rating

Bruce County

1. Condition vs. PerformanceTotal category replacement value $397,844,530

Segment value as a % of total category replacement value


Road Surface0.9

Total category replacement value $397,844,530Segment value as a % of total category

replacement value

Bridges & Culverts






star rating

Very Good A 5 71,480,953 60% 3.02

Good B 4 18,975,887 16% 0.64

Fair C 3 7,718,040 7% 0.20

Poor D 2 8,549,604 7% 0.14

Very Poor F 1 11,567,869 10% 0.10

Totals 118,292,353.00 100% 4.10






star rating

Very Good A 5 23,282,253 52% 2.59

Good B 4 3,968,490 9% 0.35

Fair C 3 2,104,502 5% 0.14

Poor D 2 9,711,209 22% 0.43

Very Poor F 1 5,821,193 13% 0.13Totals 44,887,647.00 100% 3.65

4.0 B


Funding available



grade

$4,181,000 $1,544,000 $2,637,000

Average star rating


Bruce County



Bridges3.0

Total category replacement value $163,180,000Segment value as a % of total category

replacement value


Culverts1.0




36.9%

1.0 F

3. Overall Rating


4.0 1.0

2.5 D+

Buildings






star rating

Very Good A 5 4,041,605 5% 0.24

Good B 4 34,543,257 41% 1.65

Fair C 3 10,307,528 12% 0.37

Poor D 2 15,242,985 18% 0.36

Very Poor F 1 19,821,654 24% 0.24Totals 83,957,029 100% 2.85

2.9 C


Funding available



grade

$2,760,000 $801,000 $1,959,000

Average star ratingCondition vs Performance star rating Funding vs. Need star rating Overall letter grade

2.9 1.0

1.9 D

3. Overall Rating

Buildings2.9




29.0%

1.0 F


Bruce County









star rating

Very Good A 5 1,067,379 16% 0.81

Good B 4 1,091,898 17% 0.66

Fair C 3 730,442 11% 0.33

Poor D 2 1,107,207 17% 0.34


2.5 D+


Funding available



grade

$934,000 $583,000 $351,000

Average star rating

3. Overall Rating


2.5 2.9

2.7 D+


62.4%

2.9 C


Equipment, Furniture & Fixtures 2.5



Bruce County



Land Improvements






star ratingVery Good A 5 322,624 3% 0.17

Good B 4 4,609,435 49% 1.97Fair C 3 917,908 10% 0.29

Poor D 2 3,248,084 35% 0.69Very Poor F 1 260,233 3% 0.03

Totals 9,358,284 100% 3.16

3.2 C


Funding available



grade

$350,000 $0 $350,000

Average star rating


Bruce County




0.0%

0.0

Land Improvements3.2



F

F

3. Overall Rating


3.2 0.0

1.579








Good B 4 727,238 8% 0.31Fair C 3 1,194,622 13% 0.38

Poor D 2 1,129,348 12% 0.24Very Poor F 1 5,818,790 62% 0.62

Totals 9,438,795 100% 1.84

1.8 F


Funding available



grade

$1,548,000 $796,000 $752,000

Average star rating


Bruce County




51.4%

1.9

Machinery & Vehicles1.8



F

D

3. Overall Rating


1.8 1.9

1.8

Social Housing






star rating

Very Good A 5 16,765,937 17% 0.83

Good B 4 13,702,507 14% 0.54

Fair C 3 27,760,238 27% 0.82

Poor D 2 19,611,384 19% 0.39


2.8 D+


Funding available



grade

$3,187,000 $1,910,000 $1,277,000 1.9 D


2.8 1.9

2.325 D

3. Overall Rating

Social Housing2.8




59.9%


Bruce County



Technology and Communication






star rating

Very Good A 5 368,064 12% 0.61

Good B 4 508,801 17% 0.67

Fair C 3 272,015 9% 0.27

Poor D 2 572,862 19% 0.38


2.4 D


Funding available



grade

$667,000 $784,000 -$117,000

Average star rating



Bruce County




Technology and Communication 2.4


117.5%

5.0 A

3. Overall Rating


2.4 5.0

3.7 C+

Trail Program







Good B 4 333,957 18% 0.74Fair C 3 231,206 13% 0.38

Poor D 2 957,750 53% 1.06Very Poor F 1 0 0% 0.00

Totals 1,813,079 100% 2.98

3.0 C


Funding available



grade

$85,000 $19,000 $66,000


3.0 0.0

1.5 F

3. Overall Rating

Trail Program3.0




22.4%

0.0 F


Bruce County



The County of Bruce

$2.06

$0.86 $0.65

$0.57

$0.07 $0.14 $0.02$0.32

$0.19$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

Road Network Bridges and

Culverts

Social Housing Buildings Land

Improvements

Technology and

Communication

Trails Program Machinery and

Vehicles

Equipment,

Machinery &

Furniture

Daily cup of coffee: $1.56

Daily infrastructure investment: $4.87

Daily Investment Required Per Household for Infrastructure Sustainability

Infrastructure Replacement Cost Per Household Total: $58,198 per household


Total Replacement Cost: $6,587,934

Cost Per Household: $494

Trails Program

Total Replacement Cost: $1,813,079


Buildings Total Replacement Cost: $83,957,029 Cost Per Household: $6,294

Road Network Total Replacement Cost: $397,844,530 Cost Per Household: $29,823

Land Improvements Total Replacement Cost: $9,358,284


Machinery and Vehicles Total Replacement Cost: $9,438,795 Cost Per Household: $708 Technology and Communication Total Replacement Cost: $3,023,196 Cost Per Household: $227

Bridges and Culverts Total Replacement Cost: $163,180,000

Cost Per Household: $12,232

Social Housing Total Replacement Cost: $101,155,724 Cost Per Household: $7,583

The Asset Management Plan for the County of Bruce Assest...Amadea Setiabudhi Data Analyst...

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