Managing Our Infrastructure

Today I’m in a course about Asset Management. This concerns making decisions about how infrastructure is used, cared for, and invested in to ensure both current and future strategic priorities are met.

Below is an interesting graph we looked at. It illustrates the infrastructure needs of a theoretical community. The green bars are the Renewal Investements needed every year to replace or renew aging infrastructure- these vary year-to-year, but are somewhat predicatable. The blue line is the Annual Lifecycle Investment- what needs to get saved year to year to pay for upcoming renewal costs without taking out debt.

Right now, City staff are working on an asset management strategy. They are cataloguing everything we own (roads, buildings, trees, playgrounds, etc...) and estimating its lifetime, maintenance costs, and renewal/replacement cost. Once this is done, Council will have to look at information like this and decide how to plan for the future.

When we see a large blip years in the future (example: a building needed major renewal), how should we approach it?

Should we be setting aside money right away? If we do this, today’s taxpayers are saving up to pay for the infrastructure future taxpayers will use. This ensures that money is available at replacement time without needing debt. But it also means that that money is locked away for years rather than being invested in the community.

Should we plan to take out long term debt to replace it? If we do this, then future taxpayers are directly paying for the infrastructure they are using. This adds debt servicing costs to the project. But it allows us to be investing today’s money elsewhere in the community.

Or should we take a more middle of the road approach? Maybe we plan to save aggressively for five years before the project, or we plan to take out debt but pay it back in just five years.

I’m looking forward to Council discussing how we want to approach caring for infrastructure. I’d love to hear your thoughts.

-Dylan