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ASSET MANAGEMENT STRATEGY

Version 2.2: September 2017

ASSET MANAGEMENT STRATEGY (FINAL DRAFT) PAGE 2 OF 48

Document Control

Document ID: 110817-ESC AMS v2-2 (Final Draft).docx

Rev No Date Revision Details Author Reviewer Approver

1 2011 Original Strategy - superseded ESC

2.1 August 2017 Draft incorporating comments and

review by Asset Management

Group

CLM Civil

Engineering

Warren

Sharpe

Rob Burke

ELT

Warren

Sharpe

2.2 September 2017 Final document incorporating

review comments by the Executive

Leadership Team & General

Manager

CLM Civil

Engineering

Warren

Sharpe

Rob Burke Warren

Sharpe


Table of Contents 1 Executive Summary ........................................................................................................................................ 5

2 Introduction ................................................................................................................................................... 9

2.1 Community Infrastructure and Operational Assets ............................................................................ 10

2.2 Goals and Objectives of Asset Management ...................................................................................... 11

2.3 Integrated Planning and Reporting Framework .................................................................................. 12

2.4 Office of Local Government – Financial Ratios ................................................................................... 13

3 Management of Councils Assets .................................................................................................................. 17

3.1 Asset Management Policy ................................................................................................................... 17

3.2 Managing Our Assets .......................................................................................................................... 17

4 State of the Assets ....................................................................................................................................... 20

4.1 General Fund Infrastructure Assets .................................................................................................... 21

4.2 Asset Consumption Ratio .................................................................................................................... 24

4.3 Asset Condition/Functionality/Capacity and Utilisation ..................................................................... 25

4.4 Community Research .......................................................................................................................... 26

4.5 Asset Life Cycle Costs and Financial Status ......................................................................................... 29

4.6 Asset Performance Ratios ................................................................................................................... 29

5 Asset Management Plan Dashboards .......................................................................................................... 31

5.1 Transport Infrastructure Assets .......................................................................................................... 32

5.2 Stormwater Infrastructure Assets ....................................................................................................... 34

5.3 Community and Operational Facilities Infrastructure Assets ............................................................. 35

5.4 Recreational Facilities Infrastructure Assets ....................................................................................... 37

5.5 Marine Infrastructure Assets .............................................................................................................. 38

5.6 Waste Services Assets ......................................................................................................................... 39

6 Asset Management Improvement Plan ....................................................................................................... 40

6.1 Asset Management Planning elements ............................................................................................... 40

6.2 Asset Management Improvement Plan .............................................................................................. 42

6.3 Monitoring and Review ....................................................................................................................... 44

6.4 Performance Measures ....................................................................................................................... 44

7 References ................................................................................................................................................... 44

8 Abbreviations ............................................................................................................................................... 45

9 Glossary........................................................................................................................................................ 46


List of Figures and Tables

Figures: Figure 2-1 Distribution of Asset Groups by Gross Replacement Cost .................................................................. 10

Figure 2-2 Integrated Planning and Reporting Framework .................................................................................. 13

Figure 4-1 Asset Condition by Gross Replacement Value ..................................................................................... 25

Figure 4-2 Quadrant Analysis of Transport Infrastructure ................................................................................... 27

Figure 4-3 Quadrant Analysis of 'Other Assets' .................................................................................................... 27

Figure 4-4 LTFP Expenditure - All Asset Classes .................................................................................................... 29

Tables:

Table 2-1 Fit For The Future benchmarks – General Fund ................................................................................... 16

Table 4-1 Asset Consumption Ratios .................................................................................................................... 24

Table 4-2 Micromex 2016 Performance Gap Ranking for Infrastructure Assets .................................................. 26

Table 4-3 Asset Performance Indicators – General Fund ..................................................................................... 30

Table 6-1 Asset Management Improvement Plan ................................................................................................ 43


1 Executive Summary

Introduction

Eurobodalla Shire Council is responsible for a wide range of infrastructure assets required to service

residents and visitors. These assets have a combined current replacement value of $1.71B (as at 30

June 2016) and an annual depreciation estimated at $29.5M (for the 2017-18 financial year).

Depreciation represents 28.4% of the consolidated budget position within Council’s financial

Operating Statement for the 2016-17 financial year.

Water and sewer infrastructure assets have a current replacement value of $827M. These assets are

managed within the Water and Sewer Funds respectively. The long-term planning and funding needs

for Water and Sewer infrastructure assets are addressed in the Integrated Water Cycle Management

Strategy 2016 (adopted by Council on 13 December 2016) http://www.esc.nsw.gov.au/inside-

council/community-and-future-planning/strategies/integrated-water-cycle-management. The

funding for these services are provided through a combination of access and user charges in accord

with the NSW Best Practice Pricing Guidelines. The information pertaining to the asset management

of these assets is therefore not duplicated within this Asset Management Strategy.

The remaining infrastructure assets are funded through the General and Waste Funds with a current

replacement value of $874.4M and $6.25M respectively.

Office of Local Government Requirements

For infrastructure within the General and Waste Funds, Council should continue to demonstrate that

it can meet the Fit for The Future financial ratios including the Asset Maintenance Ratio, Building and

Infrastructure Renewal Ratio and Infrastructure Backlog Ratio.

Council must also report on the cost to bring assets to agreed service level ratio from 2016-17 onwards.

Funding for General and Waste Fund infrastructure assets is subject to the constraints of rate pegging,

which is set annually by the Independent Pricing and Regulatory Tribunal (IPART). The rate pegging

amount is often set at a rate below the real cost of operations and maintenance and capital

construction increases, all which are influenced by aspects such as the cost of labour, materials,

energy, increasing community expectations and higher standards (e.g. work health and safety,

environmental approvals, disability inclusion). These latter items are all worthy pursuits to improve

outcomes, however this has increased the cost of undertaking works.

Managing Assets

To meet the needs of our community, Council must provide for the whole of life costs of all

infrastructure assets under its care in both the short and long term including the cost of;

i) Adequate provision for maintenance and operations including inspections, recurring and

planned maintenance, repairs, energy, water and the like,

ii) Capital renewal works to replace asset components in poor or very poor condition,

iii) Capital renewal or upgrade works to improve the functionality of assets to meet

community need (e.g. accessible buildings),

iv) Capital upgrades or new infrastructure to meet current and future capacity needs (e.g. a

new by-pass road or a new building),


v) Disposal of infrastructure assets at the end of their useful life to eliminate any future

liability costs, where required.

Sound financial management requires that Council considers the financing of the whole of life costs

of existing assets as a priority over the construction of new infrastructure assets. It is important to

recognise that as soon as an asset is built, the maintenance, operation and annual depreciation costs

impact Council’s financial Operating Statement (the budget).

The proper care and maintenance of infrastructure assets also has a significant impact on the risk to

the community, particularly community safety. Council is required to demonstrate the sound

management of infrastructure assets to mitigate these risks to the community and Council, and to

ensure legislative compliance, particularly with the Civil Liability Act, 2002 and Roads Act, 1993.

Council has adopted sound asset management principles for many years developing and

implementing;

i) key infrastructure strategies, studies, plans, point score systems and developer

contribution plans to identify and prioritise capital works,

ii) sound maintenance management systems in line with appropriate risk management

policies and frameworks.

This has been further enhanced through the development of formal asset management plans for the

following infrastructure assets categories;

i) Transport infrastructure such as local and regional roads, bridges, pathways, car parks, bus

stops and ancillary infrastructure,

ii) Stormwater infrastructure,

iii) Marine infrastructure such as boat ramps, wharves, jetties and rockwalls,

iv) Recreation facilities such as playing fields, reserves and aquatic centres,

v) Community (such as halls and libraries) and Operational Facilities (such as the main

administration office and depots),

vi) Waste facilities (under development).

Key Challenges

This Asset Management Strategy identifies the challenges that Council faces and provides a strategic

framework within which Council will work to manage its assets for the benefit of the community.

These challenges include;

i) the rate variation significantly improved Council’s financial resources to sustain infrastructure

assets into the future. However, Council is still required to find significant savings and

efficiencies, and pro-actively pursue grants to deliver the outcomes the community seeks.

Council’s Long Term Financial Plan includes additional allocations of funding toward

infrastructure asset renewal from 2019-20.

ii) managing demand for new and improved services. Council must weigh up the benefits of any

new infrastructure assets against the longer term financial sustainability and affordability

taking account of the ‘whole of life costs’ including financing, maintenance, operating and

replacement costs. It should also pursue well planned growth to better utilise and support

existing infrastructure which has the capacity to service a greater permanent population.

iii) the lack of formal pathways across Eurobodalla has been identified by the community as a

specific high priority gap. This gap is a result of changing subdivision requirements with only


23% of Council’s urban road network having a pathway on at least one side. Council has

adopted the Eurobodalla Pathways Strategy 2017 to identify higher priority pathways and is

pursuing grant funding to assist deliver the $11.7M worth of pathways identified.

iv) an estimated population during peak holiday periods of 120,000 creates significant challenges

from an infrastructure management perspective, particularly for roads, parking, water, sewer

and high profile public reserves.

v) the management of ageing infrastructure assets in need of renewal and/or upgrade.

Infrastructure assets such as roads and stormwater drains present particular challenges. Many

were constructed at the time of the original subdivision and are in declining condition, and/or

do not satisfy current functionality and/or capacity requirements.

vi) Council is currently working through the process of determining solutions for the Mackay Park

Precinct which will to have an impact going forward and the Asset Management Strategy

should be reviewed once an outcome is determined.

Key Strategies

To provide for the sound management of our infrastructure assets Council has implemented a wide

range of actions including;

i) Fully funding the required maintenance and operation at the agreed level of service,

ii) Fully funding the annual infrastructure renewal cycle for short lived assets (i.e. useful life

less than 20 years) to progressively lower the overall cost to bring assets to a satisfactory

condition over time. For instance, resealing bitumen roads or replacing the carpet in a

building,

iii) Budgeting for capital works to renew or rehabilitate long lived assets (i.e. useful life

greater than 20 years) typically taking account of risks (e.g. replacement of a structural

road pavement in poor condition),

iv) Prudent use of loan funding, typically for infrastructure assets with a long useful life (e.g.

a new library exhibition center),

v) Partnering with Government through grants to fund infrastructure replacement and/or

upgrades (e.g. replacing a timber bridge with a new concrete bridge capable of carrying

higher productivity vehicles),

vi) Adjusting the level of service in consultation with the community (e.g. removing one of

the two halls in Tuross Head to enable a higher quality building that provides an accessible

inclusive community space),

vii) Strategic review of assets to optimise the asset portfolio under Council’s care including

clustering of assets, improving what we have instead of building new facilities and/or

removal of poorly positioned assets (e.g. as per the Recreation and Open Space Strategy

2010),

viii) Recycling of assets no longer required (e.g. sale of land to fund new and upgraded

recreation infrastructure as per the adopted Recreation and Open Space Strategy),

ix) Integration of works to optimize re-use of materials (e.g. re-use of old road pavement

materials to build components of new assets),

x) Use of new technologies (e.g. re-lining of pipes in-situ rather than digging them up to

replace the pipe, where appropriate),

xi) Implementation of targeted risk management strategies (e.g. higher inspection regime,

signposting or temporarily closing assets in poor condition),

xii) Improving asset management (e.g. by progressively improving the quality of asset data,

condition assessments and the like),


xiii) Identifying new sources of income other than rates (e.g. provision of a gym at an aquatic

centre or through increased utilisation with the associated payment of fees),

xiv) Actively pursuing planned growth to increase the number of ratepayers and people

utilising the capacity of existing infrastructure assets (more people paying for the cost of

infrastructure assets),

xv) Ensuring land use planning optimises the infrastructure assets required to support

development,

xvi) Requiring developers to build appropriate infrastructure at their cost and/or pay

appropriate developer contributions as part of the development approval.

The strategies adopted by Council are considered best practice and many have now been adopted by

the sector as outlined within current guidelines produced by the Office of Local Government.

The outcomes of this Asset Management Strategy are guided by Council’s Community Strategy Plan.

The funding flowing from this Asset Management Strategy have been incorporated into Council’s

2017-21 Delivery Program, 2017-18 Operational Plan and the 2017-26 Long Term Financial Plan.

This Asset Management Strategy also includes an improvement plan to guide future actions to

improve the asset management planning with time. The resources allocated to this work need to be

balanced against the improvements gained compared to the allocation of resources to undertake

works and services. The improvement plan is included under Section 6 of this plan.


2 Introduction

Eurobodalla Shire Council is a rural council based on the NSW south coast, covering an area of 3,403

square kilometres. It is located on over 110km of coastline, stretching from Durras Lake in the north

to Wallaga Lake in the south. Eurobodalla encompasses the catchments of the Clyde, Tomaga,

Deua/Moruya and Tuross Rivers as well as Wagonga Inlet. Eurobodalla includes the major towns of

Batemans Bay, Moruya and Narooma as well as a number of smaller towns and villages spread along

the coastal strip.

Known for its pristine waterways, the Eurobodalla region is a major tourist destination. Eurobodalla

has a resident population of 37,701 (2016), although more detailed analysis indicates a typical

population of approximately 50,000 at any given time due to visitation. The estimated population

during peak holiday periods is 120,000 creating significant challenges from an infrastructure

management perspective, particularly for roads, parking, water, sewer and high profile public

reserves.

The Eurobodalla Shire has had a number of significant growth periods since the 1970’s. Economic

activity has moved from agriculture to tourism based, whilst state forests and national parks account

for approximately 80% of the Shire’s land area. The gross domestic product of Eurobodalla is now

estimated at $1.3B with $408M of this related to the visitor market.

This Asset Management Strategy identifies the challenges that Council faces and provides a strategic

framework within which Council will work to manage its assets for the benefit of the community.

A key issue facing Council is the management of ageing infrastructure assets in need of renewal and/or

upgrade. Infrastructure assets such as roads and stormwater drains present particular challenges.

Many were constructed at the time of the original subdivision and are in declining condition, and/or

do not satisfy current functionality and/or capacity requirements.

To ensure a sustainable future Council has implemented a strong regime of infrastructure asset

planning and maintenance management aligned to long term financial plans to effectively allocate

limited resources to sustain and where necessary, improve its infrastructure assets. This includes

addressing the outstanding list of infrastructure renewal through innovative strategies such as

differentiating between short lived and long-lived infrastructure assets in combination with taking a

longer term financial planning.

There is however also a demand for new and improved services which add to the challenges in

planning and financing infrastructure assets to deliver the social, economic and environmental

outcomes sought by the community.

Council must therefore weigh up the benefits of any new infrastructure assets against the longer term

financial sustainability and affordability taking account of the ‘whole of life costs’ including financing,

maintenance, operating and replacement costs. It should also pursue well planned growth to better

utilize and support existing infrastructure which has capacity to service a greater permanent

population. Council will need to make strategic decisions on infrastructure to help drive this growth

and deliver social, economic and environmental outcomes.


An example of this is the development of the Mackay Park Precinct. Council is currently working

through the process of determining solutions for the Mackay Park Precinct which will to have an

impact going forward and The Asset Management Strategy should be reviewed once an outcome is

determined.

2.1 Community Infrastructure and Operational Assets

Eurobodalla’s extensive asset portfolio includes;

Infrastructure including roads, bridges, carparks, pathways and stormwater drainage,

Community & operational buildings such as libraries, community centres, public toilets and public

halls,

Recreational assets including sporting fields, parks and reserves, skate parks and netball facilities,

Marine infrastructure such as wharves and jetties, boat ramps and ocean rockwalls,

Water and sewer assets including distribution and collection mains, treatment plants and

reservoirs.

Waste Services

The proportion of infrastructure assets (based on Gross Replacement Costs) in each of the Asset

Management groups is shown in Figure 2.1 below. Further details are shown in Section 4.2.

Figure 2-1 Distribution of Asset Groups by Gross Replacement Cost (Source: 15/16 SS7)

These infrastructure assets under Council’s care and control, directly and indirectly impact our social

and economic well-being and the environment in which we live. This includes risks to our community’s

health and safety, the desirability of Eurobodalla as a place to live, work and invest, and social equity

outcomes across Eurobodalla.

Careful and strategic management of these infrastructure assets in the context of our long term

financial plan is required to ensure our infrastructure delivers the required services within the limited

Community & Operational

Facilities14%

$120.55M

Transport69%

$605.05M

Marine1% - $8.89M

Waste Services1% - $6.25M

Stormwater11%

$95.81M

Recreational Facilities

5% - $44.1M


resources available to Council. The NSW and Australian Government legislative framework must also

be considered, with many minimum requirements to be met.

Often Council will need to make decisions on priorities taking account of the outcomes sought by the

current community, yet with a view to the intergenerational equity. It is critical that our Council and

community, leaves a positive legacy, rather than a debt for our children.

This Asset Management Strategy details proposals for the management of infrastructure assets in the

six major Asset Management Groups (Transport, Stormwater, Community and Operational Facilities,

Recreational Facilities, Marine and Waste Services) only. The Gross replacement cost of these six asset

groups is about $880M with a written down value of $606M.

It should be noted that these Asset Management Groups do not necessarily follow the financial reporting groups of Council’s annual financial reporting. These asset groups are for asset management purposes only.

Water and Sewer are not considered further in this version of the Asset Management Strategy as these infrastructure assets are managed through the ‘Integrated Water Cycle Management Strategy and Strategic Business Plan’ adopted by Council at its Ordinary meeting on 13 December 2016. http://www.esc.nsw.gov.au/inside-council/community-and-future-planning/strategies/integrated-water-cycle-management/Integrated-Water-Cycle-Management-Strategy.pdf

2.2 Goals and Objectives of Asset Management

The Local Government Act 1993, Chapter 13, Part 2, Section 403, clauses 1 and 2 requires that ‘a

council must have a long-term strategy (called its Resourcing Strategy) for the provision of the

resources required to implement the strategies established by the community strategic plan that the

council is responsible for. The Resourcing Strategy is to include long-term financial planning, workforce

management planning and asset management planning’.

This Asset Management Strategy is in response to the above requirement and sets the broad framework for undertaking Asset Management in a structured and coordinated way, outlines why and how Asset Management will be undertaken and provides key principles that underpin Asset Management at Eurobodalla Shire Council.

In resourcing the implementation of Council’s Community Strategic Plan – One Community, this Asset Management Strategy shows how the Council’s existing asset portfolio will contribute to the service delivery requirements of the community both now and into the future. In particular it;

Sets out the affordable level of asset service provision over the next 10 years, given projected available funding,

Outlines how the Council’s assets will be effectively managed to achieve agreed levels of affordable service,

Outlines the risks associated with the provision of an affordable level of service and how they will be responsibly managed,

Outlines the requirements to ensure this Asset Management Strategy is achieved including implementation of an Asset Management Improvement Program that details the tasks required to achieve an appropriate level of asset management maturity,

Ensures the integration of the Council’s Asset Management with its long term Community Strategic Plan – One Community, Resourcing Strategy and four-year Delivery Program.


2.3 Integrated Planning and Reporting Framework

A new planning and reporting framework for all Councils in NSW was introduced in 2010. The

Integrated Planning and Reporting Framework, is an integrated framework which ensures that

Councils take a longer term approach taking account of the whole of life costs of infrastructure assets,

and that Councils are reflecting community aspirations in the work they do.

The Integrated Planning and Reporting framework consists of a Community Strategic Plan, a four year

Delivery Program and one year Operational Plan (or budget). These are accompanied by a Resourcing

Strategy consisting of a Long Term Financial Plan, Asset Management Strategy and Workforce

Management Plan consistent with the direction set by the elected Council for the four-year term.

Importantly, this Asset Management Strategy is consistent with the Long Term Financial Plan.

To ensure Council has reflected the community aspirations, extensive community engagement has

been undertaken to develop Council’s Community Strategic Plan, Delivery Program and Operational

Plan. This culminated in Council adopting these plans as follows:

i) One Community Eurobodalla Community Strategic Plan 2017 adopted by Council at the

meeting held 13 June, 2017. The adopted CSP is available on Council’s web-site at:

http://www.esc.nsw.gov.au/inside-council/community-and-future-planning/community-

strategic-plan

ii) Delivery Program 2017-21 & Operational Plan 2017-18 adopted by Council at the meeting

held on 27 June, 2017. The adopted DP/OP is available on Council’s web-site at:

http://www.esc.nsw.gov.au/inside-council/community-and-future-planning/delivery-

program-and-operational-plan

This Asset Management Strategy takes account of the direction set by the current Council. It is intended that this Asset Management Strategy be updated on an annual basis to support the activities and decision making of Eurobodalla Shire Council into the future.

A more significant review will be undertaken every four years following each election of a new Council to take account of the strategic direction established by each new Council in developing the Community Strategic Plan and the associated four-year Delivery Program.


Figure 2-2 Integrated Planning and Reporting Framework

The Integrated Planning and Reporting amendments to the Local Government Act contain ten

essential elements which must be included within the Asset Management Planning component of the

Resourcing Strategy. Council, through this Asset Management Strategy and other Asset Management

documentation, has achieved compliance with the legislative requirements of all ten essential

elements.

2.4 Office of Local Government – Financial Ratios

The Office of Local Government has overseen the NSW Government’s Fit for Future program.

Council submitted a Fit for Future Improvement Proposal in June 2015. This proposal was underpinned

by the sound long term financial and infrastructure planning already in place

Eurobodalla Shire Council has been assessed as 'fit', having sufficient scale and capacity to operate as

a stand-alone council.

Council was assessed against seven benchmarks when being considered as Fit For Future. The

benchmarks show how Council works towards long term sustainability.

Scale and Capacity

Council must demonstrate that it has strong organisational and regional capacity to mobilise resources

to engage effectively across community, industry and government.

Financial Sustainability

Council must generate sufficient funds over the long term to provide the agreed level and scope of

services and infrastructure for communities, as identified through the Integrated Planning and

Reporting process.


Benchmarks used to measure financial sustainability are:

1. Operating ratio: indicates capacity to meet ongoing operating expenditure requirements.

2. Own source operating revenue ratio: Councils with higher own source revenue have greater

ability to control their own operating performance and financial sustainability.

3. Infrastructure renewal ratio: measures whether Council's assets are deteriorating faster than

they are being renewed and indicates whether Council's infrastructure backlog is likely to

increase.

Infrastructure and Service Management

Benchmarks used to measure infrastructure and service management are:

4. Infrastructure backlog ratio: measures how effectively Council is managing its infrastructure.

5. Asset maintenance ratio: measures whether Council is spending enough on maintaining its

assets.

6. Debt service ratio: indicates whether Council is using debt wisely to share the lifelong cost of

assets and avoid excessive rate increases.

Since the Fit for Future assessment, the Office of Local Government has introduced a new

infrastructure ratio. This applies from the 2016-17 Annual Financial Statements and Council will be

required to report on the cost to bring assets to agreed service level ratio. This ratio will provide a

snapshot of the proportion of outstanding renewal works compared to the total gross replacement

value of infrastructure assets under Council’s care and stewardship. This ratio is reported along with

other in its annual financial statements, in particular, Special Schedule 7 (SS7) and has been mandated

from 2017-18. This new ratio may in time replace the Infrastructure Backlog Ratio and is seen as more

valuable in aiding collation of the future infrastructure funding need.

Efficiency

Council must provide efficient service and infrastructure delivery, achieving value for money for

current and future ratepayers.

The benchmark used to measure efficiency is:

7. Real operating expenditure per capita: indicates how well Council is utilising economies of

scale and managing service levels to achieve efficiencies.

This benchmark can be affected by a range of factors outside of the efficiency of undertaking works.

For example, changes in population will obviously impact the ratio. Eurobodalla has a high non-

resident population, with 38% of landowners identified as living outside of Eurobodalla. The efficiency

ratio is measured based on the permanent population measured by the Bureau of Statistic which

excludes a large percentage of the non-resident population.


Fit for Future Improvement Proposal

Council's Fit for the Future Improvement Proposal explains how it will maintain and improve Council's

performance against all seven Fit for the Future benchmarks.

In implementing its Improvement Action Plan, Council will:

support economic growth and development through a new Integrated Economic Growth

and Development Strategy

collaborate with our community to review services as part of the Integrated Planning and

Reporting process

implement a prioritised renewals funding strategy to improve performance against the

Building and Infrastructure Asset Renewal and Infrastructure Backlog ratios

redirect surplus funds into a new restricted infrastructure renewals fund and an increased,

targeted renewals program

strengthen and diversify Council's revenue streams to continue to meet the Own Source

Revenue Ratio and achieve modest operating surpluses to be redirected into infrastructure

renewal

further increase our capacity and focus on long term planning and organisational sustainability

invest in improved community relationships through the development of a robust community

engagement framework

advocate for improved funding and financing arrangements, to meet community service and

infrastructure needs.

Table 2.1 below shows Council’s performance against the mandatory benchmarks compared to the

starting position in 2013-14. The ratios shown relate to general fund assets only and are an average

over three years (a requirement of Fit for The Future reporting). Infrastructure Asset Performance

Ratios for 2015-16 only are shown in Section 4.6 – Asset Performance Ratios.


Ratio Benchmark 2014/15

result

2015/16

result

2016/17

projected

2017/18

projected

Meet benchmark

Operating performance

ratio

Greater than or equal to break-even (0.00%)

average over 3 years

0.047 0.03 0.07 0.06

meet

Own source revenue

ratio

Greater than 60% average over 3 years 77.47% 68.70% 65.19% 66%

meet

Building and

infrastructure asset

renewal ratio

Greater than 100% average over 3 years 54.14% 119.71% 95.13% 124%

meet

Infrastructure backlog

ratio

Less than 2% 8.73% 8.51% 8.60% 6.91%

improving

Asset maintenance ratio Greater than 100% average over 3 years 100% 100% 100% 100%

meet

Debt service ratio Greater than 0% and less than or equal to 20%

average over 3 years

2.55% 6.83% 8.33% 8%

meet

Real operating

expenditure per capita

Decrease over time 0.95 1.49 1.51 1.42

meet

Agreed Service Level

Ratio

Decrease over time 3.35% 5.85% 5.85% 4.87%

improving

Table 2-1 Fit For The Future benchmarks – General Fund (Source: General Purpose Financial Statements 14-15, 2014-15 Annual Report, 2015-16 Annual Report, 2014-15 SS7, 2015-16 SS7, DPOP 16-17, 2017-21 DP, 2017-18 OP)


3 Management of Councils Assets

3.1 Asset Management Policy

The Asset Management Policy aims to ensure that Council’s assets are managed effectively to deliver

the level of service our community is prepared to pay for in the short, medium and long term taking

account of the social, economic and environmental consequences of Council’s decisions.

The policy aims to promote an integrated framework for dealing with the management, renewal and

upgrading of infrastructure assets and to ensure consistency and fairness in the manner in which the

Council deals with infrastructure assets.

Following public exhibition of the draft policy, Council adopted a new Asset Management Policy at the

meeting held on 25 July, 2017. The policy is available on Council’s web-site at:

http://www.esc.nsw.gov.au/inside-council/council/council-policies

This Asset Management Strategy is developed in accord with the Asset Management Policy. The

Strategy enables Council to show how its asset portfolio will meet the affordable service delivery

needs of the community in the future and ensure the integration of Council’s asset management with

its long term strategic and financial plans.

3.2 Managing Our Assets

Council’s long term financial plan outlines the funding required to sustain Council’s existing

infrastructure assets and agreed new infrastructure assets outlined in Council’s various strategic plans.

The funding available to Council from rate income is subject to the constraints of rate pegging, which

is set annually by the Independent Pricing and Regulatory Tribunal (IPART). The rate pegging amount

is often set at a rate below the real cost increase of maintenance, operation and capital construction

increases which are influenced by aspects such as the cost of materials and energy, labour, increasing

community expectations and increasing standards (e.g. work health and safety, environmental

approvals, disability inclusion). These latter items are all worthy pursuits to improve outcomes

however this has increased the cost of undertaking works.

To meet the needs of our community, Council must provide for the whole of life costs of all

infrastructure assets under its care in both the short and long term including the cost of;

i) Adequate provision for maintenance and operations including inspections, recurring and

planned maintenance, repairs, energy, water and the like,

ii) Capital renewal works to replace asset components in poor or very poor condition,

iii) Capital renewal or upgrade works to improve the functionality of assets to meet

community need (e.g. accessible buildings),

iv) Capital upgrades or new infrastructure to meet current and future capacity needs (e.g. a

new by-pass road or a new building),

v) Disposal of infrastructure assets at the end of their useful life to eliminate any future

liability costs, where required.


Sound financial management requires that Council considers the financing of the whole of life costs

of existing assets as a priority over the construction of new infrastructure assets. It is important to

recognise that as soon as an asset is built, the maintenance, operation and annual depreciation costs

impact Council’s financial Operating Statement (the budget).

The proper care and maintenance of infrastructure assets also has a significant impact on the risk to

the community, particularly community safety. Council is required to demonstrate the sound

management of infrastructure assets to mitigate these risks to the community and Council, and to

ensure legislative compliance, particularly with the Civil Liability Act, 2002 and Roads Act, 1993.

Council has adopted sound asset management principles for many years developing and

implementing;

i) key infrastructure strategies, studies, plans, point score systems and developer

contribution plans to identify and prioritise capital works,

ii) sound maintenance management systems in line with appropriate risk management

policies and frameworks.

This has been further enhanced through the development of formal asset management plans for the

following infrastructure assets categories;

i) Transport infrastructure such as local and regional roads, bridges, pathways, car parks,

bus stops and ancillary infrastructure,

ii) Stormwater infrastructure,

iii) Marine infrastructure such as boat ramps, wharves, jetties and rockwalls,

iv) Recreation facilities such as playing fields, reserves and aquatic centres,

v) Community (such as halls and libraries) and Operational Facilities (such as the main

administration office and depots),

vi) Waste facilities (under development).

To provide for the sound management of our infrastructure assets Council has implemented a wide

range of actions including:

i) Fully funding the required maintenance and operation at the agreed level of service,

ii) Fully funding the annual infrastructure renewal cycle for short lived assets (i.e. useful life

less than 20 years) to progressively lower the overall cost to bring assets to a satisfactory

condition over time. For instance, resealing bitumen roads or replacing the carpet in a

building,

iii) Budgeting for capital works to renew or rehabilitate long lived assets (i.e. useful life

greater than 20 years) typically taking account of risks (e.g. replacement of a structural

road pavement in poor condition),

iv) Prudent use of loan funding, typically for infrastructure assets with a long useful life (e.g.

a new library exhibition center),

v) Partnering with Government through grants to fund infrastructure replacement and/or

upgrades (e.g. replacing a timber bridge with a new concrete bridge capable of carrying

higher productivity vehicles),

vi) Adjusting the level of service in consultation with the community (e.g. removing one of

the two halls in Tuross Head to enable a higher quality building that provides an accessible

inclusive community space),

vii) Strategic review of assets to optimise the asset portfolio under Council’s care including

clustering of assets, improving what we have instead of building new facilities and/or


removal of poorly positioned assets (e.g. as per the Recreation and Open Space Strategy

2010),

viii) Recycling of assets no longer required (e.g. sale of land to fund new and upgraded

recreation infrastructure as per the adopted Recreation and Open Space Strategy),

ix) Integration of works to optimize re-use of materials (e.g. re-use of old road pavement

materials to build components of new assets),

x) Use of new technologies (e.g. re-lining of pipes in-situ rather than digging them up to

replace the pipe, where appropriate),

xi) Implementation of targeted risk management strategies (e.g. higher inspection regime,

signposting or temporarily closing assets in poor condition),

xii) Improving asset management (e.g. by progressively improving the quality of asset data,

condition assessments and the like),

xiii) Identifying new sources of income other than rates (e.g. provision of a gym at an aquatic

centre or through increased utilisation with the associated payment of fees),

xiv) Actively pursuing planned growth to increase the number of ratepayers and people

utilising the capacity of existing infrastructure assets (more people paying for the cost of

infrastructure assets),

xv) Ensuring land use planning optimises the infrastructure assets required to support

development,

xvi) Requiring developers to build appropriate infrastructure at their cost and/or pay

appropriate developer contributions as part of the development approval.

The strategies adopted by Council are considered best practice and many have now been adopted by

the sector as outlined within current guidelines produced by the Office of Local Government.

The outcomes of this Asset Management Strategy are guided by Council’s Community Strategy Plan.

The funding flowing from this Asset Management Strategy have been incorporated into Council’s

2017-21 Delivery Program, 2017-18 Operational Plan and the 2017-26 Long Term Financial Plan.

Rate variation

Council’s application for a rate variation of 6.5% per annum for three years cumulative and on-going,

including the rate peg amount, was approved by IPART in May 2015. Council adopted the rate variation

at the 23 June 2015 Council Meeting for incorporation in the 2015-16, 2016-17 and 2017-18 budget.

The rate variation significantly improved Council’s financial resources sustain infrastructure assets into

the future. However, Council is still required to find significant savings and efficiencies, and pro-

actively pursue grants to deliver the outcomes the community seeks. Council’s Long Term Financial

Plan includes additional allocations of funding toward infrastructure asset renewal from 2019-20.

Council will need to be mindful of the whole of life cost impacts of any new infrastructure built,

including that ‘gifted’ through development and/or by community groups, to ensure it weighs up the

cumulative long-term impacts of its decisions on Council’s financial sustainability.


4 State of the Assets

The infrastructure assets Council provides for the community have an estimated gross replacement

value of $880.65M (exclusive of Water and Sewer) based at 30 June, 2016.

The following table provides detailed information on;

What assets support the service,

A description of the asset and how they deliver related services,

Financial information including gross replacement cost (GRC) and written down values (WDV).

The state of the assets is also represented by other indicators, including;

The consumption of assets indicating their remaining service potential,

The overall status of infrastructure assets for condition, capacity/utilisation and functionality.


4.1 General Fund Infrastructure Assets

Service Assets supporting the service Description Replacement

value (GRC)

Carrying

Value (WDV)

Transport

57.5km of regional roads

529.6km of local sealed roads

419km of local unsealed roads

22 concrete/Steel bridges

38 timber bridges

54 major culverts

22.69km of road drainage

67 bus shelters

151 carparks

39.3km of shared paths

66.9km of footpaths

The transport network enables the safe and efficient movement of people and

goods into and throughout Eurobodalla. The network provides for all modes of

transport from pedestrians, wheelchairs and bicycles to family cars, buses and

transport operators.

Transport infrastructure includes sealed and unsealed urban and rural roads,

bridges, causeways, culverts, pathways, footpaths, car parks, bus shelters and

traffic management facilities such as roundabouts, traffic lights and signs.

Council also works in partnership with Roads and Maritime Services and receives

grant funding to maintain the Kings Highways, one of the main routes into and out

of Eurobodalla.

$605.05M $428.77M

Stormwater

7664 stormwater pits

179.2km of stormwater pipes

3.2km of box culverts

476m of open channel

904 headwalls

1 detention basin

21 gross pollutant traps

8 quality control basins

28 tide flaps

The stormwater network collects, controls and manages stormwater. It addresses

safety, risk and amenity issues, protects property and maintains the quality of our

waterways by managing discharge.

$95.81M $71.71M



value (GRC)

Carrying

Value (WDV)

Buildings

Community Buildings

o 3 libraries

o 2 community centres

o 3 after-school care

o 4 surf clubs

o 7 public halls

o 16 sporting facilities

49 public toilets

26 emergency services buildings

1 botanic gardens centre

1 race course

Operational Buildings

o 1 administration

o 3 depots

o 13 cemeteries

o 1 saleyards

o 1 pound

o 5 telecommunications

towers

o 2 tourist centres

1 airport

3 swimming pool complexes

1 caravan park

3 campgrounds

Buildings enable residents and visitors to participate in activities and events within our community. They also provide for commercial and Council operations.

$120.55M $66.09M



value (GRC)

Carrying

Value (WDV)

Recreation

16 sporting facilities

151 parks and reserves

5 skate parks

4 netball facilities

The recreation network enables community and visitors to actively enjoy

Eurobodalla’s natural areas and participate in active outdoor activities and events.

Facilities are used for activities such as group sports, events, markets, play and

exercise.

$44.10

million

$27.87 million

Marine

20 wharves, jetties, pontoons and

piers

Boat ramps

o 22 concrete

o 2 gravel

15 launching facilities (informal)

10 wash down facilities

25 fish cleaning tables

33 river rockwalls

3 ocean rockwalls

Marine facilities provide access to Eurobodalla’s waterways for recreation, tourism

and commercial users. They also assist in managing and protecting sensitive

riverbank and foreshore environments.

$8.89 million $5.71 million

Waste

Services

2 waste management facilities

1 waste transfer station

Our waste facilities enable the efficient and sustainable management of waste within Eurobodalla. They provide handling and management of waste to maintain amenity and meet environmental compliance and legislative requirements.

$6.25 million $5.52 million

Total Replacement Value of General Fund Assets $880.65

million

$605.67

million


4.2 Asset Consumption Ratio

The asset consumption ratios of Council’s assets (average proportion of ‘remaining service potential’

left in assets, being the WDV divided by GRC) are shown in Table 4.1 – Asset Consumption Ratios.

Asset Class Gross Replacement Cost

($M)

Written Down Value

Cost ($M)

Asset Consumption

(% life remaining)

Transport $605.05 $428.77 71%

Community &

Operational Facilities

$120.55 $66.09 55%

Stormwater $95.81 $71.71 75%

Recreation $44.10 $27.87 63%

Marine $8.89 $5.71 64%

Waste Services $6.25 $5.52 88%

Total $880.65 $605.67 Average all assets = 70%

Table 4-1 Asset Consumption Ratios (Source: 15/16 SS7)

The data shown in Table 4.1 demonstrates, that on average, when considering all of Council’s

infrastructure assets that they have consumed around 30% of their original construction/purchase

costs. This indicates that Council is managing its assets effectively and that it ensures that the majority

of assets are in good to excellent condition. Further details regarding asset consumption can be found

in individual asset management plans. It is worth noting that this information however does not

indicate the current renewal need which must be based on further detailed analysis of the specific

infrastructure assets, and infrastructure assets components, requiring renewal and/or upgrade (refer

to Table 4.3).


4.3 Asset Condition/Functionality/Capacity and Utilisation

Levels of service and community satisfaction are fundamentally linked to asset physical condition

(quality), asset functionality and asset capacity/utilisation. Figure 4.1 below shows the value (based

on gross replacement cost) of the infrastructure assets in various conditions.

Figure 4-1 Asset Condition by Gross Replacement Value (Source: 2015-16 SS7)

Substantial work has be done in the transport asset class in determining required functionality and

capacity upgrades going forward. These have been incorporated into Council’s Long Term Financial

Plan and guide grant applications.

There are limited functionality and capacity upgrades required in other assets classes however upon

completion of the Recreation and Open Space Strategy review further work is required to quantify

these requirements.

Functionality and capacity upgrades are also considered at the time of asset renewal works which

enables upgrades to be undertaken in a more cost effective manner.

Council will need to monitor rates of development which will also drive the need and location of

upgrades.


4.4 Community Research

Quadrant analysis

Quadrant analysis is a useful tool for assisting planning future directions. This compares the

community’s views on the importance and satisfaction of various infrastructure assets under Council’s

care and stewardship.

Micromex Research undertook community research in April 2016 surveying a random and

representative sample of the Eurobodalla community to measure the satisfaction and views on

importance on a wide variety of service delivery areas (total 49). Table 4.2 highlights responses against

the service delivery areas that relate to infrastructure assets.

The higher the differential between importance and satisfaction, the greater the difference is between

the provision of that service by Council and the expectation of the community for that service/facility.

Performance Gap Ranking

Infrastructure Assets Importance Mean

Satisfaction Mean

Performance Gap

2 Capacity of infrastructure, including traffic management and congestion at peak times

4.21 2.54 1.67

3 Provision and maintenance of sealed roads 4.53 2.96 1.57

6 Provision and maintenance of unsealed roads

4.23 2.79 1.44

9 Provision and maintenance of public toilets 4.56 3.27 1.29

14 Provision and management of parking facilities

4.21 3.11 1.10

18 Appearance of public spaces, such as town centres

4.32 3.28 1.04

20 Provision and maintenance of stormwater and flood mitigation infrastructure

4.37 3.36 1.02

25 Provision and maintenance of footpaths and shared pathways

4.37 3.46 0.91

26 Accessibility of public facilities and places 4.26 3.40 0.85

29 Road safety programs 4.17 3.41 0.76

31 Provision and maintenance of pools and aquatic facilities

3.97 3.40 0.57

32 Provision and maintenance of parks and playgrounds

4.28 3.73 0.56

39 Provision of street lighting 4.09 3.65 0.44

43 Provision and maintenance of bus shelters 3.81 3.50 0.31

44 Provision and maintenance of community centres and halls

3.99 3.73 0.26

45 Provision and maintenance of sports grounds and sporting amenities

3.99 3.75 0.24

46 Library services including buildings and lending collections

4.17 4.11 0.06

47 Provision and maintenance of boating facilities such as boat ramps and fish cleaning tables

3.65 3.69 -0.04

Table 4-2 Micromex 2016 Performance Gap Ranking for Infrastructure Assets (Source: ESC Micromex Community Survey, April 2016)


The following quadrant analysis looks at the cumulative responses to questions posed about the

satisfaction and importance of infrastructure. For clarity, the results have been placed into two charts;

the first dealing with Council’s largest asset group, our transport infrastructure, and the second chart

deals with all other infrastructure.

Figure 4-2 Quadrant Analysis of Transport Infrastructure

(Source: ESC Micromex Community Survey, April 2016).

Figure 4-3 Quadrant Analysis of 'Other Assets' (Source: ESC Micromex Community Survey, April 2016).


Micromex provided the following interpretations of the quadrants.

Attributes in the top left quadrant, IMPROVE, such as ‘traffic congestion’, ‘sealed roads’, ‘unsealed

roads’, ‘public toilets’, ‘stormwater’ and ‘appearance of public spaces’ are key priorities in the eyes of

our community.

Attributes in the top right quadrant, MAINTAIN, such as ‘pathways’, ‘accessibility’, ‘parks and

playgrounds’, are our core strengths. Council will maintain and attempt to improve its position in these

areas as they are influential and address community needs.

Attributes in the bottom right quadrant, COMMUNITY, such as ‘pools’, ‘sports grounds’, ‘community

centres and halls’, and ‘road safety’ are core strengths, but in relative terms they are deemed less

overtly important than other directly obvious areas. However, the occupants of this quadrant tend to

be the sort of services and facilities that deliver to community livability, i.e. make it a good place to

live and will often be in higher demand for improvement by user groups.

Specific Strategic Infrastructure Planning Engagement

Council has undertaken specific engagement in developing various strategic infrastructure plans. The

associated community engagement typically includes a greater level of input from those using or

directly impacted by the infrastructure assets. It is common for feedback from users to be more

specific to user needs. These considerations also need to be considered by Council in making decisions

about the infrastructure to be provided.

Council has the following strategic infrastructure plans in place:

i) Northern Area of Eurobodalla Transport Study March 2011

ii) Batemans Bay Traffic and Transport Study 2010

iii) Batemans Bay Parking Study 2011

iv) Moruya and Narooma Parking Study 2011

v) Eurobodalla Pathways Strategy June 2017

vi) Recreation and Open Space Strategy 2010 (currently under review in 2017-18)

vii) Asset Management Plans

These strategies and studies and the approved rate variation identify the future capital works required

to meet community need over the next 20-year horizon. These strategies and studies will be updated

considering the rate of change and/or development at the appropriate time.

The development of strategies, plans and studies required significant community engagement prior

to adoption by Council. Council considered the outcomes of these strategies in developing and

adopting the 2017-21 Delivery program and 2017-18 Operational Plan.

To achieve many of the additional new capital works outlined in these strategies, plans and studies,

Council actively pursues grant funding, appropriate developer and landowner contributions. Council

works closely with community groups to deliver infrastructure services that otherwise could consume

Council’s own source revenue alone. This often means the precise timing of works is dependent upon

current NSW and Australian Government grant programs and/or other funding availability.


4.5 Asset Life Cycle Costs and Financial Status

Figure 4.4 shows the funding required to manage Council’s infrastructure assets for the next 10 years.

A large renewal component in 2017-18 and 2018-19 can be seen and is due to an injection of revenue

from secured grant funding and the approved rate variation. 2017 and 2018 also shows a large capital

upgrade/new component and represents currently secured grant funded projects including $6.5M in

election commitments from the Federal Government. The step up in renewals from 2019-20 onwards

is attributable to the injection of renewal funding associated with Council’s Renewal Funding Strategy.

Figure 4-4 LTFP Expenditure - All Asset Classes

4.6 Asset Performance Ratios

Section 2.4 introduces Fit for Future and its associated reporting ratios. The Fit for Future ratios are

the average ratio over the preceding 3 years.

Asset performance ratios, as reported in Special Schedule 7 of Council’s Annual Financial Reports, are

for the past year and are an indicator on how well Council is funding appropriate care of infrastructure

assets. The debt/service ratio and operating position also provide an indication of Council’s ability to

borrow to fund new and upgraded capital works.

Special Schedule 7 uses five ratios to report on infrastructure assets annually to the Office of Local

Government including:

1. Infrastructure renewal ratio – to assesses the rate of renewal expenditure compared to the annual

depreciation of infrastructure assets

2. Infrastructure backlog ratio – shows what proportion the backlog is against the total value of a

infrastructure assets

3. Asset maintenance ratio – compares actual to required cost of operating and maintaining

infrastructure assets

$-

$5

$10

$15

$20

$25

$30

$35

$40

17/18 18/19 19/20 20/21 21/22 22/23 23/24 24/25 25/26 26/27

LTFP

Exp

end

itu

re Mill

ion

s

Financial Year

All Infrastructure Assets

Maintenace Renewal Upgrades/New


4. Cost to bring assets to agreed service level – this ratio is mandatory from 2017-18 onwards. This

ratio provides a snapshot of the proportion of outstanding renewal works compared to the total

gross replacement value of infrastructure assets

5. Capital expenditure ratio – assesses the extent to which a Council is expanding its asset base

through capital expenditure on both new assets (including gifted) and the replacement and

renewal of existing assets.

Table 4.3 shows Council’s Asset Performance Ratios for June 30, 2016 and only includes those assets

funded by the General Fund. Whilst a consolidated ratio is reported on all assets in Special Schedule

7, including water and sewer, they have been omitted from this document.

Infrastructure Asset Performance Indicator Ratio for

June 30,

2016

Benchmark 2015/16

Performance

1. Infrastructure renewals ratio 119.71% Minimum >=100.00%

meet

2. Infrastructure backlog ratio 8.51% Maximum <2.00% improving

3. Asset maintenance ratio 1.0 Minimum >1.00

meet

4. Cost to bring assets to agreed service level 5.85% Yet to be set by OLG

5. Capital expenditure ratio 1.49 Minimum >1.10

meet

Table 4-3 Asset Performance Indicators – General Fund (Source: 15/16 SS7)

Council has consciously funded maintenance at the current level of service to ensure the Asset

Maintenance Ratio is maintained at the benchmark. Council is also fully funding the required annual

infrastructure renewal expenditure through a combination of funding sources including own source

revenue, low interest loans from the NSW Government, grants and contributions from other sources.

Council has adopted an approach to fully fund the average annual infrastructure renewal cycle of short

lived infrastructure asset components (e.g. reseals, resheeting, playgrounds, carpets and the like being

assets typically having a useful life less than 20 years). To achieve this Council has fully allocated grant

funding programs such as Roads to Recovery toward road and bridge renewal.

Council has also targeted larger scale works such as bridge replacements through use of loans and

grant funding programs significantly reducing the risk to the community and Council, as well as

removing these works from the outstanding renewal works. This has also resulted in addressing

capacity constraints allowing the opportunity for improved transport efficiency across the network.

This strategic approach will see the amount of outstanding renewal work further reduce steadily over

the next ten years, providing a safer and more sustainable network of transport and community

infrastructure assets.

This strategic approach also means that Council met all requirements under the Fit for Future analysis

contributing positively to the decision by the NSW Government to deem Eurobodalla Shire Council as

‘fit’.


5 Asset Management Plan Dashboards

This section contains the ‘Asset Management Plan Dashboards’ relating to each of the major asset

groups. The dashboards are snapshots of relevant information on each of the asset groups. By

scanning the dashboard, you are provided with information about what the community sees as

important, the key programs for delivering the service, the linkage to the current Delivery

Plan/Operational Plan, what assets support the service, the annual funding available to deliver the

service, the longer-term lifecycle expenditure (10 years) and how sustainable the assets are. All of this

information is critical allowing informed decisions to be made on the management of Council’s $1.71

billion asset portfolio.

Detailed information on asset attributes, budgets, programs, condition, etc. can be found in the

associated Asset Management Plans. The information contained in each dashboard has been derived

from Council’s annual financial statements (Special Schedule 7), associated Asset Management Plans

and Council’s current Delivery Plan/Operational Plan.


5.1 Transport Infrastructure Assets

Community Satisfaction Survey (April 2016)

Service/Facility Rank

of 49 Importance Satisfaction Gap

Traffic congestion 2 4.21 2.54 1.67

Sealed roads 3 4.53 2.96 1.57

Unsealed roads 6 4.23 2.79 1.44

Parking 14 4.21 3.11 1.10

Pathways 25 4.37 3.46 0.91

Road safety 29 4.17 3.41 0.76

Street lighting 39 4.09 3.65 0.44

Bus shelters 43 3.81 3.50 0.31

Key Transport Programs

Service Description: The transport service provides the

infrastructure like roads and paths that enables the

movement of people, vehicles and goods into and

throughout Eurobodalla. The following key transport

programs need to be continued to ensure the integrity of

a safe and reliable transport network.

Transport Maintenance Local Roads New Capital

Works Program

Road Safety Officer

Program

Bridges & Causeways

Maintenance

Reseal Program Bridges Renewal Program

Pavement Rehabilitation

Program

Bridges New Capital Works

Program

Gravel Resheeting Program Regional Road Operations

& Maintenance

Urban Roads Program Regional Roads Renewal

Program

Rural Roads Reconstruction

Program

Regional Roads New Capital

Works Program

Footpaths/Cycleways

Capital & Renewal Program

Kings Highway Routine

Maintenance Contract

Traffic Facilities Kings Highway Non-routine

Maintenance

Car Parks Kings highway Contracts

Works

Bus Shelters

Links to DP/OP

1. Strong Communities Desirable Lifestyle:

1.1.1.2 Provide road safety programs and activities

7. Connected and Accessible Places:

7.1.1.1 Partner with peak bodies to advocate for improved

and on-going funding programs for local transport

infrastructure.

7.1.1.2 Seek grant and other funding to sustain and improve

the local and regional transport network.

7.1.2.1 Build, renew and maintain the road network.

7.1.2.3 Provide traffic management planning.

7.1.2.5 Coordinate the Local Traffic Committee.

7.2.1.1 Build, renew and maintain pathway network.

7.2.1.2 Leverage existing funding to accelerate expansion of

the pathway network.

7.3.1.1 Advocate for improved public transport.

7.4.2.1 Work with key partners to advocate for the

progressive upgrade of the Princes and Kings Highway

Assets Supporting the Service

Sealed local roads 529.6km

Unsealed local roads 419km

Regional roads 57.5km

Bridges & major culverts 114

Causeways 19

Pathways 106.2km

Carparks 151

Bus shelters 67


Transport Infrastructure Assets (cont.)

10 Year Projected Operating and Capital Expenditure

Current Condition

Data Confidence High Moderate Low

Budgeted Expenditure 17/18

$-

$2

$4

$6

$8

$10

Operations &Maintenance

Renewal New/upgrade

$ $5,327,397 $8,893,710 $9,232,614

Bu

dge

t Ex

pen

dit

ure

Mill

ion

s

Value of Transport Assets $605.05 million


5.2 Stormwater Infrastructure Assets


Service/Facility Rank

of 49 Importance Satisfaction Gap

Stormwater 20 4.37 3.36 1.01

Budgeted expenditure 17/18

Key Stormwater Programs

Service Description: The stormwater network collects,

controls and manages stormwater. It addresses safety, risk

and amenity issues, protects property and maintains the

quality of our waterways by managing discharge.

Drainage Maintenance Drainage New Capital

Works

Drainage Renewals

Links to DP/OP

3. Protected and Valued Natural Environment

3.1.1.2 Manage lake openings


7.1.2.2 Build, renew and maintain the stormwater network

Current Condition

Confidence

in data

High Moderate Low

Value of Stormwater Assets

$95.81 million


Pipes, culverts & channels 179.2km

Pits, headwalls & similar

structures

8,568

Tide flaps 28

Pollution control devices 29

Detention basins 1


$-

$200

$400

$600

$800

$1,000

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

LTFP

Exp

end

itu

re

Tho

usa

nd

s

Financial Year End

Stormwater

Maintenance Renewals Upgrades/new


5.3 Community and Operational Facilities Infrastructure Assets


Service/Facility /49 Importance Satisfaction Gap

Public toilets 9 4.56 3.27 1.29

Accessibility of public

facilities and places

26 4.26 3.40 0.85

Provision of pools and

aquatic facilities

31 3.97 3.40 0.57

Provision & maint. of

community centres

and halls

44

3.99 3.73 0.26

Provision of

sportsgrounds and

sporting amenities

45

3.99 3.75 0.24

Library buildings 46 4.17 4.11 0.06

Key Community and Operational Facilities Programs

Service Description: Council provides a range of buildings

and facilities across the Shire for the community’s benefit

and usage that enable residents and visitors to participate

in community life. Council also has a number of facilities

that enables it to operate or undertake a limited range of

commercial activities.

Public halls and Rec.

buildings renewals

Swimming Pools - Capital &

Renewal

Botanic Gardens Swimming Pools Operations

Sporting Complex - Capital

& Renewal Works

Botanic Gardens New

Works

Other Sport & Recreation Cultural Projects

Sporting Complex

Amenities Mtce/Operation

Library Projects

Public Halls - Maintenance

& Operation

Public Toilets Maintenance

Community Centres -

Maintenance & Operation

Public Toilets Construction

Public Buildings - Capital &

Renewal

Other Public Amenities

Capital Projects

Public Safety Bushfire & Emergency

Services

Office/Depot/Support

Maintenance

Office/Depot/Support -

Capital & Renewal

Other economic services Other economic services -

capital & renewal

Links to DP/OP

1. Strong Communities, Desirable Lifestyles

1.3.2.4 Manage public swimming pools

2. Celebrated Creativity, Culture and Learning

2.1.1.1 Collaborate with strategic partners for creative arts

infrastructure and sector development

2.2.1.2 Provide and manage Out of School Hours and

Vacation Care centres and activities

2.2.2.3 Maintain and improve library buildings and

collections

7. Connected and Accessible Places

7.4.1.1 Operate and maintain the Moruya Airport

7.4.1.2 Commence implementation of stage 1 and 3 of the

Moruya Airport Master Plan

9. Innovative and Proactive Leadership

9.2.3.2 Provide depots and workshops


Community buildings

including Libraries,

Community Centres & Halls

38

Public toilets 46

Emergency Services buildings 24

Botanic gardens 1

Moruya Racecourse 1

Operational buildings 26

Airport 1


Community and Operational Facilities Infrastructure Assets (cont.)



Current Condition

Confidence in data High Moderate Low

Value of Community and Operational Facilities Assets $120.55 million


5.4 Recreational Facilities Infrastructure Assets


Service/Facility Rank Importance Satisfaction Gap

Appearance of

public spaces

18 4.32 3.28 1.04

Provision and

maintenance of

parks and

playgrounds

32

4.28 3.73 0.56

Provision and

maintenance of

sportsgrounds

45

3.99 3.75 0.24


Key Recreation Programs

Service Description: The recreation network enables community

and visitors to actively enjoy Eurobodalla’s natural areas and

participate in active outdoor activities and events. Facilities are used

for activities such as group sports, events, markets, play and

exercise.

Sporting complex – capital &

renewal works

Parks, reserves & ovals

maintenance

Parks new works

Link to DP/OP

1. Strong Communities, Desirable Lifestyle

1.3.2.2 Review the recreation and open space strategy

1.3.2.3 Build, renew operate and maintain recreation and

community facilities

Current Condition

Confidence in

data

High Moderate Low

Value of Recreation Assets $44.1 million


Sporting facilities 27

Parks & Reserves 103

Skate parks 5

Netball facilities 4


$-

$1

$2

$3

$4

2017201820192020202120222023202420252026LTFP

Exp

end

itu

re

Mill

ion

s

Financial Year End

Recreation Assets



5.5 Marine Infrastructure Assets



Provision and maintenance of boating facilities such as boat ramps and fish cleaning tables

47 3.65 3.69 0.04

Budgeted Expenditure 17/18 Key Marine Programs

Service Description: Marine assets provide access to Eurobodalla’s waterways for recreation, tourism and commercial users. They also assist in managing and protecting sensitive riverbank and foreshore environments.

Boatramps, wharves and jetties maintenance

Boatramps, wharves and jetties capital renewals

Boatramps, wharves and jetties new capital works

Link to DP/OP


7.4.3.1 Advocate for NSW Government boating and marine infrastructure and ongoing dredging of navigation channels 7.4.3.2 Seek additional funding for local boating and marine infrastructure 7.4.3.3 Maintain, renew and upgrade boating and marine infrastructure

Current Condition

Confidence in

data

High Moderate Low

Value of Marine Assets $8.89million


Wharves, jetties and pontoons 20

Boat ramps and launching facilities 39

Fish cleaning tables 25

Riverbank structures 33

Ocean rockwalls 3

Shark nets 1


$-

$500

$1,000

$1,500

$2,000

2017201820192020202120222023202420252026

LTFP

Exp

end

itu

re

Tho

usa

nd

s

Financial year End

Marine Assets



5.6 Waste Services Assets



Kerbside

collection

32 4.61 4.05 0.56


Key Waste Programs

Service Description: Responsible for waste collection,

disposal, recycling, illegal dumping, infrastructure and

education. Providing sustainable waste services and

infrastructure for the community. Participating in regional

collaboration and develop strategic partnerships. Delivering

community education on waste minimisation.

Waste management facility

operational & maint. costs

Waste management facilities

capital renewal costs


Waste Management Facilities 2

Transfer Stations 1

Link to DP/OP

4. Sustainable living:

4.2.1.1 Build, renew, operate and maintain waste landfill sites

and transfer stations,

4.2.1.2 Manage kerbside collection,

4.2.1.3 Undertake annual hazardous waste collection,

4.2.2.1 Review the Waste Strategy

4.2.2.2 Participate in regional collaboration and develop

strategic partnerships

4.2.2.3 Deliver community education on waste minimisation,

4.2.2.4 Utilisation of glass sand product in Council operations,

4.2.3.1 Coordinate Clean Up Australia day activities,

4.2.3.2 Investigate and manage illegal dumping incidents.

Current Condition

Confidence in

data

High Moderate Low

Value of Waste Assets $6.25 million


$-

$1

$2

$3

$4

$5

$6

$7

Mill

ion

s

Financial Year

Operations Maintenance Renewals


6 Asset Management Improvement Plan

6.1 Asset Management Planning elements

The following commentary discusses each of the eleven asset management planning elements.

Strategic asset management planning

This Asset Management Strategy 2017 replaces the previous Asset Management Strategy 2011.

Council already links its infrastructure asset plans and strategy to the long term financial plan and

incorporates extensive community engagement as part of its decision making through the adoption

of the Community Strategic Plan, Delivery Program and Operational Plan, and various specific

infrastructure strategies, plans and studies.

Council also assesses the community’s view each four years based on a structured survey of our

community such as that undertaken by Micromex in 2016.

Council has commenced:

i) the review of the Recreation and Open Space Strategy 2010 (ROSS). This review is

scheduled for completion in 2017-18

ii) the review of the developer contributions plans. This review will follow the completion of

the ROSS and is scheduled for completion in 2017-18

iii) the preparation of a Waste Asset Management Plan which is scheduled for completion in

2017-18

Annual budget

Each year Council prepares an operational plan containing the annual budget. This is aligned to the

asset management plans and strategy and long term financial plan. Council undertakes community

engagement on the Operational Plan prior to consideration and determination.

Work in the Fit for Future area, particularly in the reporting of financial ratios and strategies to improve

ratios to the desirable levels as set by the OLG, demonstrates that we are beyond a core level in this

area. With some more work in the financial partitioning of operations, maintenance and capital

budgets, an advanced level of maturity will be achieved.

Annual Report

Each year we produce an Annual Report in accordance with the Australian Accounting Standards

which is made available to the community on Council’s web-site. The Annual Report is audited and

then tabled to Council. The report includes the measures achieved for financial performance against

short and long term financial sustainability indicators.

Asset Management Policy

Council has an adopted Asset Management Policy which defines the Council’s vision and service

delivery objectives for Asset Management. The policy has a direct linkage with Council’s Community


Strategic Plan and the Long Term Financial Plan. The policy requires an Asset Management Strategy

to be developed in accord with the integrated planning and reporting framework.

Asset Management Strategy

Council has developed this Asset Management Strategy 2017. The Strategy is linked to the Asset

Management Policy, Asset Management Plans, specific infrastructure strategies, plans and studies,

and Council’s integrated planning and reporting requirements including the long term financial plan.

This demonstrates an advance level of maturity in this Asset Management planning element.

Asset Management Plans

Council has developed formal Asset Management Plans for all major asset groups. All AMPS were

updated in the 2016-17 financial year and are current. An asset management plan is currently being

developed for Waste Facilities.

Governance and Management

This strategy is approved through a Governance process incorporating referral and review by a cross-

organisation Asset Management Matrix Group prior to approval by the Executive Leadership Team.

This Asset Management Strategy was also referred to Council as part of the briefing held in November,

2017 on the Resourcing Strategy documents. Following input from Council, the Strategy is made public

and is available on Council’s web-site.

Levels of Service

We have undertaken the process of defining, quantifying and documenting the community levels of

service, the technical levels of service, and the costs of providing these levels of service in developing

the Asset Management Plans and through our extensive engagement processes undertaken in

developing our Community Strategic Plan, Delivery Program, Operational Plan and various specific

infrastructure asset strategies, plans and studies. These levels of service are defined in the Asset

Management Plans.

Data and Systems

We have a consolidated, integrated, accurate, up to date and complete componentised asset register

with the required functionality to ensure security and data integrity of the information. This includes

the required information about each asset, sorted by asset group. Documented repeatable

methodologies exist to carry out consistent asset condition surveys and defect identification

assessments. Our asset financial reporting functionality is comprehensive and includes audit trails,

depreciation calculations, reporting thresholds and records of acquisition and disposal of assets.

Council is currently undertaking a review of all software as part of the implementation of the new

corporate information technology solution.


Skills and Processes

Processes are in place to review and update the Asset Management Strategy and Asset Management

Plans on a regular basis. There are also processes in place to identify asset and operational risks, assign

responsibilities and to monitor risk treatment actions. We have a process to annually review and

update the financial forecasts for all asset classes and update the associated long term financial plan.

Evaluation

This Asset Management Strategy provides a process by which asset management improvements are

identified, timeframes established, resources allocated, actioned, monitored and in some instances

reported to our Internal Audit Committee.

Council complies with annual reporting requirements established by the Office of Local Government

including through Note 9 and Special Schedule 7. The successful management of our assets is

demonstrated through meeting the NSW Government’s Fit for Future benchmark requirements.

6.2 Asset Management Improvement Plan

The Asset Management improvement plan tasks have been generated by considering each of the

eleven asset management planning elements. This assessment demonstrates that Council has

developed advanced processes for many elements whilst balancing the resources allocated to the

asset management task against the benefits gained. The focus will to continue to improve asset

management processes within the limits of the resources available as shown in Table 6.1 following.


Planning element

description

Improvement Plan Tasks Priority Responsible

Service Area

Timeline

Strategic long-term

plan

Complete the review of the Recreation & Open Space Strategy (ROSS) High Recreation 2017-18

Strategic long-term

plan

Review and update developer contributions plan upon completion of the ROSS High Strategic

Planning

2017-18

Annual budget Continue to update the proposed annual budget taking account of Asset Management Plans and alternate

funding opportunities as part of preparing and adopting the annual Operational Plan

High Finance 2017-18

Annual report Consider the incorporation of a ‘State of the Assets’ statement into the Annual Report. Medium Technical

Services

2018-19

AM policy Continue to undertake a review of the Asset Management Policy every four years in line with each new

Council.

Low Technical

Services

Ongoing

AM Strategy Continue to undertake a minor annual update to incorporate revised financials and full review every four

years in line with each new Council.

Medium Technical

Services

Ongoing

AM Plans Continue to undertake a minor annual update to incorporate revised financials and full review every four

years in line with each new Council.

Medium Technical

Services

Ongoing

AM Plans Develop new Waste Services Asset Management Plan. High Technical

Services

2017-18

Levels of Service Following the completion of the South Batemans Bay bypass and the Batemans Bay Bridge undertake a new

traffic study and incorporate into future planning.

Medium Technical

Services

2019-20

Levels of Service Continue to undertake regular routine condition inspections for all asset classes. Medium Technical

Services

Ongoing

Levels of Service Quantify capacity and functionality upgrades for all asset classes following completion of the ROSS Medium Technical

Services

2018-19

Data & Systems Continue to review software as part of the implementation of the new corporate information technology

solution

Low Technical

Services

Ongoing

Evaluation Continue to identify improvements in all areas of asset management including planning and documentation Medium Technical

Services

Ongoing

Table 6-1 Asset Management Improvement Plan


6.3 Monitoring and Review

This Asset Management Strategy will be reviewed annually with the updating of financial information.

A full review will be carried out every 4 years as a prelude to the development of each new four year

Delivery Program, which is established by each incoming Council. In the event of significant changes

in funding, this strategy will be amended to reflect changes in revenue and the associated renewal

and upgrade budgets.

This Strategy will be referred to during the preparation of each new Operational Plan and associated

annual budget. The selection of individual projects within each asset group will be detailed in the

related Asset Management Plans. The priorities for major works will be approved by Council through

the adoption of the annual Operational Plan.

This Strategy will be amended to recognise any significant changes in service levels and/or resources

available to provide those services as a result of the budget decision process.

6.4 Performance Measures

The effectiveness of this Asset Management Strategy can be measured by the degree to which the

required budgets identified are incorporated into Councils Long Term Financial Plan, Delivery Program

and Operational Plans.

Performance is also measured by Council making improvements to, and ultimately meeting, all

financial reporting ratios.

7 References

NSW Office of Local Government Integrated Planning and Reporting Framework Guidelines and Manual

Code of Accounting Practice and Financial Reporting Update #25 – Special Schedules

Eurobodalla Community Strategic Plan – One Community (2017)

Delivery Program 2017 - 21

Operational Plan 2017 – 18

IPWEA International Infrastructure Management Manual (2006, 2011, 2015)

IPWEA Financial Management Guidelines (2015)

Eurobodalla Shire Council Asset Management Policy (2017)

Eurobodalla Shire Council Methodology Document 2015 Revaluation of the Transport and Drainage network

Eurobodalla Shire Council Transport Asset Management Plan (v.7 Dec 2016)

Eurobodalla Shire Council Stormwater Asset Management Plan (v.5 Dec 2016)

Eurobodalla Shire Council Community and Operational Facilities Asset Management Plan (v.4 Dec 2016)

Eurobodalla Shire Council Recreational Facilities Asset Management Plan (v.4 Dec 2016)

Eurobodalla Shire Council Marine Asset Management Plan (v.6 Jan 2017)

Local Government Financial Sustainability Nationally Consistent Framework, Frameworks 1, 2 & 3 (May 2009)

Integrated Water Cycle Management Strategy and Strategic Business Plan (2016)

Eurobodalla Waste Strategy 2011 – 2018


8 Abbreviations

AMP Asset Management Plan

AMS Asset Management Strategy

ESC Eurobodalla Shire Council

IPART Independent Pricing and Regulatory

Tribunal

LOS Level of Service

LTFP Long Term Financial Plan

NAF Australian National Assessment

Framework

OLG Office of Local Government


9 Glossary

Asset Capacity/Utilisation: the ability of the

physical infrastructure to meet service needs.

Asset Condition: the condition of the physical

infrastructure that allows it to meet the intended

service.

Asset Condition Assessment: The process of

continuous or periodic inspection, assessment,

measurement and interpretation of the resultant

data to indicate the condition of a specific asset so

as to determine the need for some preventative or

remedial action.

Asset Function: the ability of the physical

infrastructure to meet program delivery needs.

Asset Lifecycle Costs: The life cycle cost is average

cost to provide the service over the longest asset

life cycle. It comprises annual maintenance and

asset consumption expense, represented by

depreciation expense. The Life Cycle Cost does not

indicate the funds required to provide the service in

a particular year.

Asset Maintenance ratio: This ratio compares

actual versus required annual asset maintenance. A

ratio of above 100% indicates that the council is

investing enough funds that year to halt the

infrastructure backlog from growing. The

benchmark is > 100%.

Asset Management: the combination of

management, financial, economic, engineering and

other practices applied to physical assets with the

objective of providing the required level of service

in the most cost effective manner.

Asset Management Code of Practice: Describes

generically how Council goes about managing its

assets. It is non-asset specific and provides the

technical background in managing infrastructure

assets.

Asset Management Improvement Program: Tasks

and actions identified in the Asset Management

Plan to improve and enhance the knowledge and

methodologies of Asset Management Practices.

Asset Management Plan: A documented plan to

demonstrate the management of assets,

compliance with regulatory requirements and to

communicate the funding needed for the

operations, maintenance, renewals, upgrades and

new assets providing the required levels of service

over a 10 year planning period.

Asset Management Policy: The AM policy ensures

that;

Council’s assets are managed effectively to

deliver the level of service our community is

prepared to pay for in the short, medium and

long term taking account of the social,

economic and environmental consequences of

Council’s decisions.

Costs are reasonably shared between those

using and consuming the assets today and

those who will be required to renew, replace,

upgrade or dispose of those assets in the future

(providing inter-generational equity),

and there is continuous improvement in asset

management and service delivery.

Asset Management Strategy: Is part of Council's

Resourcing Strategy covering a four year period.

The Plan outlines resources required to deliver the

community's vision in the community strategic

plan.

Asset Matrix Group: A group within Council that

uses a whole of organisation approach to oversee

improvements to Asset Management practices,

documentation and data.

Building and Infrastructure Renewals ratio: to

assess the rate at which assets are being renewed

against the rate at which they are depreciating.

Benchmark > 100%.

Capital new: Expenditure which creates a new asset

providing a new service to the community that did

not exist beforehand. As it increases service

potential, it may impact revenue and will increase

future operating and maintenance expenditure.

Capital upgrade: Expenditure, which enhances an

existing asset to provide a higher level of service or

expenditure that will increase the life of the asset

beyond that which it had originally. Upgrade

expenditure is discretional and often does not

result in additional revenue unless direct user

charges apply. It will increase operating and

maintenance expenditure in the future because of

the increase in the council’s asset base.

Community Strategic Plan: a 20 year community

plan which identifies the main priorities and

aspirations for the future of the Council area.


Component: An individual part of an asset which

contributes to the composition of the whole and

can be separated from or attached to an asset or a

system.

Cost to bring assets to agreed service level: The

ratio indicates proportion of the gross replacement

cost of Council assets that have reached the

intervention level set by Council based on the

condition of the asset. This ratio is the sum of the

outstanding renewal works, valued as the work to

be undertaken, compared to the total replacement

cost of Council’s assets.

Critical Assets: Those assets that are likely to result

in a more significant financial, environment and

social cost in terms of impact on organisational

objectives.

Delivery Program: Details the initiatives and

projects to be undertaken by Council in a four year

period to deliver the community's vision in the

community strategic plan.

Depreciated replacement cost (DRC or WDV): The

current replacement cost (GRC) of an asset less,

where applicable, accumulated depreciation

calculated on the basis of such cost to reflect the

already consumed or expired future economic

benefits of the asset.

Fair value: The amount for which an asset could be

exchanged, or a liability settled, between

knowledgeable, willing parties, in an arm’s length

transaction.

Fit for the Future: Fit for the Future is the NSW

Government's plan to revitalise and strengthen

local government. The program provides councils

with benchmarks to measure and improve their

performance and give communities the assurance

that their councils' finances are being well

managed.

General Fund: The General Fund includes all

Council services that are funded by the General

Rate, the environment and stormwater levies and

waste charges. The primary sources of income for

this fund include rates, fees and charges. This fund

is what Council’s Fit for the Future performance is

based on.

Grant Funding: Monies received generally tied to

the specific projects for which they are granted,

which are often upgrade and/or expansion or new

investment proposals.

Gross Replacement Cost (GRC): The cost the entity

would incur to acquire the asset on the reporting

date. The cost is measured with reference to the

lowest cost at which the gross future economic

benefits could be obtained in the normal course of

business, or the minimum it would cost to

replace/construct the existing asset with a

technologically modern equivalent new asset with

the same economic benefits as the existing asset

had when it was new, allowing for any differences

in the quantity and quality of output and in

operating costs.

Impairment Loss: The amount by which the

carrying amount of an asset exceeds its recoverable

amount.

Infrastructure Assets: Physical assets of the entity

or of another entity that contribute to meeting the

public's need for access to major economic and

social facilities and services, e.g. roads, drainage,

footpaths and cycleways. These are typically large,

interconnected networks or portfolios of composite

assets. The components of these assets may be

separately maintained, renewed or replaced

individually so that the required level and standard

of service from the network of assets is

continuously sustained. Generally the components

and hence the assets have long lives. They are fixed

in place and are often have no market value.

Infrastructure Backlog ratio: This ratio shows what

proportion the infrastructure backlog is against the

total value of a council’s infrastructure. The

benchmark is < 2%.

Integrated Planning and Reporting: an integrated

framework which ensures that Councils are

reflecting community aspirations in the work they

do.

Level of service: The parameters or combination of

parameters that reflect social, political, economic

and environmental outcomes that the organisation

delivers. Levels of service statements describe the

outputs or objectives an organisation or activity

intends to deliver to customers.

Loans / borrowings: Loans result in funds being

received which are then repaid over a period of

time with interest (an additional cost). Their

primary benefit is in ‘spreading the burden’ of

capital expenditure over time. Although loans

enable works to be completed sooner, they are only


ultimately cost effective where the capital works

funded (generally renewals) result in operating and

maintenance cost savings, which are greater than

the cost of the loan (interest and charges).

Long Term Financial Plan: Is part of Council's

Resourcing Strategy covering a ten year period. The

Plan outlines resources required to deliver the


plan.

Maintenance: All actions necessary for retaining an

asset as near as practicable to its original condition,

but excluding rehabilitation or renewal.

Maintenance does not increase the service

potential of the asset or keep it in its original

condition. It slows down deterioration and delays

when rehabilitation or replacement is necessary.

Modern equivalent asset: A structure similar to an

existing structure and having the equivalent

productive capacity, which could be built using

modern materials, techniques and design.

Replacement cost is the basis used to estimate the

cost of constructing a modern equivalent asset.

Operation: The active process of utilising an asset

which will consume resources such as manpower,

energy, chemicals and materials.

Operational Plan: Details the specific actions,

budgets and capital works Council will undertake in

the financial year.

Pavement Management System (PMS): A

systematic process for measuring and predicting

the condition of road pavements and wearing

surfaces over time and recommending corrective

actions.

Rate Variation: A rate variation is a rate increase

approved by IPART for the purposes of providing an

additional revenue stream to Council. It is often

used to reduce a backlog of renewal works and to

bring assets to a satisfactory standard.

Remaining life: The time remaining until an asset

ceases to provide the required service level or

economic usefulness. Age plus remaining life is

economic life.

Renewal: Works to replace existing assets or

facilities with assets or facilities of equivalent

capacity or performance capability.

Residual value: The net amount which an entity

expects to obtain for an asset at the end of its useful

life after deducting the expected costs of disposal.

Resourcing Strategy: the provision of the resources

required to implement the strategies established by

the community strategic plan. The Resourcing

Strategy includes long-term financial planning,

workforce management planning and asset

management planning.

Risk Management: The application of a formal

process to the range of possible values relating to

key factors associated with a risk in order to

determine the resultant ranges of outcomes and

their probability of occurrence.

Special Schedule 7 (SS7): The Report on

Infrastructure Assets providing information on a

council’s assets. The nature of the information in

the Report on Infrastructure Assets is related to the

condition, maintenance and renewal of

infrastructure assets. Mandatory and included in

Council’s Annual Financial Statements.

Useful life:

Either:

(a) the period over which an asset is expected to be

available for use by an entity, or

(b) the number of production or similar units

expected to be obtained from the asset by the

entity.

It is estimated or expected time between placing

the asset into service and removing it from service,

or the estimated period of time over which the

future economic benefits embodied in a

depreciable asset, are expected to be consumed by

the council.

Work Force Plan: Is part of Council's Resourcing

Strategy covering a four year period. The Plan

outlines resources required to deliver the


plan.

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