Category: Asset Management

How Technology has Changed Asset Management Programs in the Last 5 Years

I have worked on asset management projects throughout my 5-year tenure here at Hoyle, Tanner. Although 5 years doesn’t seem like much time, it has been ample time to see evolution in the way asset management programs are used and how they’re needed to function.

Whether it be the funding agency rules, regulatory requirements, or simply the needs of the clients, the asset management landscape has been continuously evolving. Most notably has been the evolution of what clients are requesting from their asset management programs. Before working for Hoyle, Tanner, I worked as a state regulator and my interactions with asset management were primarily in the form of capital planning. An engineer comes in, runs through an evaluation of your assets, and says “Here, these are your priority projects for the next 10 or so years.” Useful for planning purposes? Perhaps. Maximizes the use of your assets? Unrelated.

At the time, I would have considered a box of index cards with your routine maintenance needs that you paw through every month to be a pretty good asset maintenance plan. A GIS system that shows all your assets in the right locations would have been pretty good asset collection; though, let’s be honest, the paper map was probably more updated. 

Through my first few years at Hoyle, Tanner, I started seeing more and more clients developing those index cards. Except now they’re not index cards, they’re calendar reminders. Then, more clients wanted to update those GIS maps and keep them updated. They want to keep track of asset condition. “We check these annually, why can’t we document that and update the GIS info accordingly?”

You can. Let’s create a work order system to document your work on assets and update your asset inventory based on it.

Then came the vertical assets. Clients saw that they could electronically keep track of those horizontal assets, why not your pumps and treatment equipment, too? One of the bigger jumps in the evolution of asset management was information access. Clients have GIS maps, asset inventories, work orders, standard operating procedures, photos, tie books, and now they wanted to access all of this information out in the field.

Along with this request for improved information access came the request for interconnectivity of data. “When I submit a work order, can that automatically update my condition assessment?” Sure, let’s figure out how.

We have now reached a point where we have made the connection between asset maintenance programs and asset planning: true asset management.

We have now reached a point where we have made the connection between asset maintenance programs and asset planning: true asset management. We’re now associating life expectancy and finance with how those assets are maintained. As a result, we are now seeing a return to that capital planning need. Except it’s no longer a dead binder sitting on a shelf for 10 years, it is a moving list that’s updated based on changes logged in the asset management program. During annual budgeting, we’re seeing more clients looking to their asset management programs to make short- and long-term investment decisions.

But has asset management really changed? What has really come to my attention is that the fundamentals of asset management have not changed, only where we are in the process. We work with a multitude of asset management clients, and although many have reached the point of software, work orders, and financial planning, many are still just trying to develop that inventory. Once they get that inventory, they want that automatic updating and the interconnected work orders. As asset management programs improve (better technology, better connectivity, etc.), we want more from them and the evolution continues.

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Hoyle, Tanner Engineers Showcase their Knowledge of Asset Management

Asset Management

On September 20, John Jackman, PE and Rychel Gibson, PE will be presenting on the basics of an asset management system at the Sunday River Grand Summit Resort Hotel & Conference Center in Newry, Maine, as part of the Maine Water Environment Association’s fall convention.

The focus of their presentation will be the documentation, organization and data collection for physical assets using tools like Google Forms. By using Google tools  (Drive, Calendar, Maps, and Forms), users can input data for free from a computer, tablet or phone. Among other tasks, John and Rychel will demonstrate how to use Google Forms to fill out daily logs and inspection sheets, and how to use Google Maps to document and track GPS assets.

Physical assets – like pipes, pumps, and valves — can be stressed from over-use, underfunding, and aging. It is the responsibility of the asset manager to know when an asset has reached its useful life. Over the past two decades, practical, advanced techniques have been developed for better managing physical assets. Hoyle, Tanner has assisted close to 40 municipalities, counties and state agencies with their asset management plans system. John Jackman has been involved with asset management for 16 years and joined the New England Water Environment Association in 2004. Rychel is a member of the Maine Water Environment Association and has been integrally involved with developing freeware-based asset management assistance during her time with Hoyle, Tanner.

 

john-and-rychel

Are you ready for the new NH MS4 Stormwater Permit?

Pond with lily pads

EPA Region 1 issued the revised New Hampshire Small MS4 General Permit on January 18, 2017. Affecting 60 New Hampshire communities, this new permit will make a significant change in stormwater management compliance when it takes effect on July 1, 2018.

This new permit imposes more stringent regulations for communities’ compliance in regards to how to manage stormwater.

Many community leaders have expressed concerns that the overlap with other regulatory requirements and the cost of meeting those requirements may not effectively achieve the desired results, and they are looking for integrated cost-effective approaches to meeting the new regulatory requirements.

Governor Chris Sununu has publicly spoken against the new MS4 permits, saying that they would severely impact municipalities and taxpayers, noting that “additional mandates contained within the new MS4 permit will prove themselves overly burdensome and enormously expensive for many of New Hampshire’s communities.”

If you live in community in Southern New Hampshire, chances are that this change affects you in some way. To see a list of affected communities, please visit the EPA website.

Hoyle, Tanner has experienced staff who are knowledgeable about asset management, SRF loan pre-application preparation, and MS4 permitting.

John Jackman, PE, asset management specialist

 

John Jackman, PE, is Hoyle, Tanner’s premier Asset Management Specialist. Although the CWSRF money cannot be directly used to support the MS4 program, using the asset management program to support documentation of municipal assets will be helpful in setting up a strategy for compliance related to the October 1, 2018 required filing date of the MS4 permit’s Notice of Intent.

 

Michael Trainque, PE, stormwater specialist

 

Michael Trainque, PE, has 39 years of environmental engineering experience.  Michael has been integrally involved in developing model stormwater regulations, identification, assessment and dry-weather sampling and testing of stormwater outfalls, as well as other aspects of stormwater management.

 

marshall

Heidi Marshall, PE has been assisting industries and municipalities with NPDES compliance since the 1990s when EPA published the initial stormwater requirements and can assist you with preparation of the Notice of Intent, developing or updating the Stormwater Management Plan, and can provide assistance with the required follow-up actions.

 

Hoyle, Tanner is equipped to help communities that are affected by MS4 regulation changes. We are immediately available to help with pre-application funding, notice of intent preparation for October, and setting up action plans to comply with MS4 requirements.

Let Hoyle, Tanner guide your community into a future with cleaner water. Contact John Jackman, PE for asset management application assistance, or for MS4 assistance, contact Michael Trainque, PE or Heidi Marshall, PE.

Asset Management – Optimization of O&M & CIP, & Funding Strategy

Recently, John Jackman, P.E. and Carl Quiram, P.E. finished our series discussion on Asset Management highlighting the Optimizing O&M and CIP, as well as Funding Strategy tasks. The concepts presented in this video reflect the utilization of collected data collected to more accurately develop a Capital Improvement Plan and the necessary steps to fund those projects. Presented are examples used by various municipalities as wells as the information necessary to capitalize on the Asset Management Program data.  – Click Here to review the other presentations given as part of the Asset Management Series.

Asset Management – Maintenance & Lifecycle Costing

Today, John Jackman, P.E. and David Wheeler, E.I.T. continued our series discussion on Asset Management highlighting Maintenance and Lifecycle Costing tasks. Covered in this presentation are the basic principles of maintaining assets as well as how to determine the lifecycle cost of those assets. Presented are project examples of maintenance programs used by various municipalities as wells as the information necessary to start adding lifecycle costs to the Asset Management Program.

Asset Management – Condition Assessment

Today, John Jackman, P.E. and Ben Horner, P.L.S. continued our Asset Management Series with a discussion on Condition Assessment. This presentation covers the differences between inspection and assessment; the benefits of knowing the condition; basics to developing a standard condition assessment; and estimating the existing useful life of various assets. Presented are examples of standard condition forms as well as our use of these forms to complete condition assessment for our clients.

Asset Management – Inventory

As part of our Asset Management Series, today we discussed – Inventory. To share their knowledge on the subject, John Jackman, P.E. and Heidi Lemay present the process; associated questions; available data; organization, data management and collection tips; and project examples of how inventory has been collected on our various asset management projects.

Click here to view the Introduction to Asset Management presentation completed last week.

Introduction to Asset Management

Recently, John Jackman, P.E. and Carl Quiram, P.E. administered the Introduction to Asset Management presentation discussing the basic principles presented in our Continuum of Asset Management post, as it relates to public works. This presentation will assist viewers in understanding the basic steps of a successful Asset Management program to help develop the process. A basic understanding of the asset management principles can assist decision makers in creating a successful and supported program.

This presentation is the first in our asset management series discussing each of the principles in depth.

Continuum of Asset Management

This graphic illustrates the Asset Management continuum with a focus on system-wide assets. Understanding the basic steps of a successful Asset Management program will help in developing a process and not a project. By describing the steps of a program it will assist decision makers in understanding the cohesive benefit for everyone to be successful and supported.

Inventory: An inventory, cataloging and mapping of the existing assets and their associated data, creates the program foundation. This includes both vertical and horizontal assets, the various information collection methods, and the accuracy standards that have to be met. Different sources of information, including paper records, spreadsheets and databases can be used to develop the list of assets. Importance is stressed on the uniformity of format for each of the assets cataloged with an eye towards its long term value to the higher end evaluation needs of the asset management program. In varying circumstances environmental, energy, financial and political information is collected with the asset logged.

Condition Assessment: An industry standard form of measure is established using asset management software to manage the following variables: age, location, risk, and current condition. The development of these standards is subjective to the organizations minimum quality level and ensures consistency throughout the program. Without these established standards asset condition becomes opinion-based and non-comparable.

Maintenance: Establishing a maintenance plan and tracking all planned and reactive efforts enables the program to validate the repairs approved, and the associated costs. Utilizing the manufacturers’ operation and maintenance manuals (where appropriate) to develop your program will ensure all asset characteristics are accounted and planned for. Work flows will be developed to define how users will capture pertinent information and keep it up to date. Standard operating procedures will be developed for preventive maintenance and energy responses to reduce the risk of failure as well as frustration. When work orders are issued, the associated tasks will be completed in the program for future planning efforts.

Lifecycle Costs: Improving asset utilization can extend asset life and performance while reducing capital costs and asset-related operating costs. Cradle to grave asset costs should be established which would include the acquisition cost, maintenance and operation costs as well as end of life costs. For many assets this would be difficult to establish, however, the more realistic the input the more reliable the output. Once this system is established, new assets would be input accurately improving the data’s usefulness over time.

Level of Service: Understanding the current level of service being delivered by the asset to its consumers, and identifying the gap between the current and proposed standards will identify the desired goals moving forward.

By formally defining a Level of Service, the goals of the program will be communicated, a link between cost and service identified, customer expectation met, and measurable results developed. Standardizing the assessment process will allow for all users to identify the remaining life of an asset and the factors impacting that useful life.

Criticality/Consequence of Failure: Identifying the impacts failure would have on the associated assets, consumers, and system is known as criticality. By developing an understanding of the consequence of failure, the organization is able to manage the associated risk. Risk is simply calculated on the probability and consequence of failure as defined by the equation:

Probability of Failure x Consequence of Failure = Risk

With an understanding of how we can reduce the system’s risk and focusing on assets where risk cannot be reduced, we are able to identify the priority of asset repairs or replacements. Failure has many factors including impacts to social, financial and environmental environments and therefore each need to be evaluated for each asset. By monitoring high risk assets impacts to those factors can be reduced, or eliminated in certain circumstances.

Optimizing Operations & Maintenance and Capital Improvement Plan: Understanding the assets condition, life cycle costs, criticality and the desired level of service allows for the analysis of an asset’s true useful life thus reducing premature replacement. By embracing asset management technology data will be gathered and analyzed in standardized and regular ways to ease the management process. By completing an analysis in a sound asset management system, a rational and defendable Capital Improvement Plan can be generated for various funding strategies and the results on Levels of Service can be clearly communicated.

Funding Strategy: Developing a long-term funding strategy based on the highest failure risk assets will assist in preventing sizeable cost increases to the system owner as well as its users. Using long-term budgeting for system assets will determine the priority based on the environmental impacts. This information will affect any grants or loans and therefore need to be discussed. By developing a long-term plan for the future the organization can assess the different impacts changes to their assets plays on their future Capital Improvement Plan.

We will be hosting a series of Lunch and Learns in our Manchester office explaining each of these tasks in more depth. To find out the dates or to join us for this series contact Nichole Davis.

Planning Your Assets – Part 2

*This post has been updated for 2020.

Building the proper foundation of an asset management program will provide a community with a short and long-term decision-making tool that community stakeholders update regularly as needs are addressed over time.  As outlined in the Key Elements of a Successful Asset Management Program and Planning Your Assets – Part 1 we shared the process of starting an asset management program as well as taking a more in-depth look at the first five of those steps. This post will round out the original nine steps covering the last four below.

Recall from our last post that with the “life-cycle” costs projected out for 50 years a community will have a long-term picture of the value of their system and the costs to own and maintain it.  The remaining four steps will help define the economic needs to maintaining a high level of service for the defined assets and define how to implement the plan successfully.

FUNDING STRATEGY FOR ASSET MAINTENANCE AND REPLACEMENT – The funding strategy for asset maintenance and replacement considers the current day value of the assets as well as defines the need for increased revenue over time for the long-term management of the assets. Based on the expected maintenance of the selected assets, the estimated cost will be calculated using Asset Management software (several programs and electronic file formats are available).  Assembling asset valuation data will provide the required information for generating updated GASB reports and define the expected investment needed in the system.  Rehabilitation costs and increased life expectancy will also be used to develop a replacement maintenance ratio for the assets to help evaluate the proper funding for repairs and replacement of the system assets.

CAPITAL IMPROVEMENT INVESTMENT PLAN (CIIP) – A summary of findings on asset condition and need for replacement will be used to develop a CIIP so the community can schedule repairs and replacements in a logical manner while managing the financial impacts to the community. As with any CIIP the priorities should be re-evaluated and updated annually as unplanned events (emergencies, extreme weather, asset failure) can cause a community to reset priorities from year-to-year.  Many communities now use a rolling five, or six-year CIIP that is updated annually to reflect work completed, adjust priorities, and consider timing of large capital projects to coincide with retiring debt.

IMPLEMENTATION PLAN – This implementation plan will be developed by collaborating with management and frontline staff to create “buy-in”, long-term support, and a thorough understanding of what needs to be done to maintain the selected assets. The implementation plan will describe how the community will continue to maintain and use the asset management program and how the community will incorporate energy and water conservation into day to day operations.  At this stage of the asset management program workflows will be developed to help identify the appropriate steps to maintain the Program to provide the defined Level of Service expected.

COMMUNICATION PLAN – Prepare a communication plan using the most effective methods to communicate to stakeholders the benefits of the asset management program and its capabilities will be key to gaining and maintaining public support for the program. The communication plan should be presented in a public forum to inform staff, community management and customers of the Asset Management Program and its capabilities.  The communication plan will demonstrate how internal and external entities will maintain the Asset Management Program in the future.  It will include Standard operating Procedures (SOP) so communities have a clear understanding of the program.  This will be a living program and should be evaluated and revised on a regular basis.

To learn out more about the Asset Management services we provide to our clients please contact Joe Ducharme, Jr., PE, Regional Manager for our Northeast Municipal Engineering Group.

Planning Your Assets – Part 1

*This post has been updated in 2020.

As outlined in the Key Elements of a Successful Asset Management Program post we shared earlier, the foundation of an asset management program will provide a community with a short and long-term decision-making tool that community stakeholders update regularly as needs are addressed over time. The program provides a methodical process of organizing, operating, maintaining, renewing, and disposing of tangible assets while tracking each asset’s useful life and risk of failure to ensure the greatest return on investment.

By creating an asset management program, communities can balance the cost of making repairs and upgrades to aging assets while maintaining a high level of service for the community.

VISION STATEMENT – This is a collaborative effort to define a vision that describes what the community wishes to achieve through development of an asset management program. When properly crafted, this community-specific vision statement will help communicate to stakeholders the purpose and overarching goals of what asset management will do for the community. The vision statement should identify and define all stakeholders (both internal and external) who will benefit from the program.

ASSET INVENTORY – Creating an asset inventory, including a naming convention specific to the community, will help identify the location and all pertinent information known about each asset. The asset inventory should include each asset name, location and all pertinent information known about each asset including age, condition, and years in service.

LEVEL OF SERVICE (LOS) WORKSHOP Prepare and conduct a workshop to gather input from a cross-section of stakeholders and ratepayers to develop a level-of-service matrix summarizing goals that are sustainable, measurable, achievable, relevant and timely (SMART). In maintaining an asset management program over time, also include methods to evaluate and reassess (SMARTER) levels of service to make sure they continue to meet the goals and needs of the stakeholders. The workshop should include input from stakeholders, such as: system operators, management, ratepayers and supporting input from the engineer (if applicable). Participation in the workshop by outside stakeholders is encouraged. Many communities have found that a balanced scorecard type matrix is helpful in developing and using LOS. These LOS goals should be reviewed frequently and modified accordingly.

PRIORITIZATION OF ASSETS – Prioritize assets based on condition assessment and criticality. Many communities have found that a risk assessment type matrix comparing likelihood of failure versus consequence of failure is an effective and useful tool for helping to prioritize assets and to visualize the state of the community’s assets.

LIFE CYCLE COST ANALYSIS (LCCA) – Analyze life cycle costs of each asset including capital costs, operating costs (including energy costs for all vertical assets) and maintenance costs for the life of the assets.

Coming up in Part 2 we will cover the additional steps in this process.

Key Elements of a Successful Asset Management Program

Step by step asset management graphic in blue and green

*This article was originally published in 2015 and has been updated in 2020.

The elements of a successful asset management program are similar from one project to the next, but each community will have specific challenges and needs that define their program. Below is a description of the ‘core elements’ that form the foundation of an asset management program designed to be a short and long-term decision-making tool that community stakeholders update regularly as needs are addressed over time. The program provides a methodical process of organizing, operating, maintaining, renewing, and disposing of tangible assets while tracking each asset’s useful life and risk of failure to ensure the greatest return on investment.

By creating an asset management program, communities can balance the cost of making repairs and upgrades to aging assets while maintaining a high level of service for the community.

  1. VISION STATEMENT – Define community-specific vision statement to communicate to all stakeholders, the purpose and overarching goals of what asset management will do for the community.
  2. ASSET INVENTORY – Create an asset inventory, including a naming convention specific to the community, that identifies the location and all pertinent information known about each asset.
  3. LEVEL OF SERVICE (LOS) WORKSHOP – Conduct a workshop to gather input from a cross-section of stakeholders and ratepayers to develop a level-of-service matrix summarizing goals that are sustainable, measurable, achievable, relevant and timely (SMART). In maintaining an asset management program over time, also include methods to evaluate and reassess (SMARTER) levels of service to make sure they continue to meet the goals and needs of the stakeholders.
  4. PRIORITIZATION OF ASSETS – Prioritize assets based on condition assessment and criticality by developing a risk assessment matrix comparing likelihood of failure versus consequence of failure to prioritize assets and to visualize the state of the community’s assets.
  5. LIFE CYCLE COST ANALYSIS (LCCA) – Analyze life cycle costs of each asset including capital costs, operating costs (including energy costs for all vertical assets) and maintenance costs for the life of the assets.
  6. FUNDING STRATEGY – Identify a funding strategy for asset maintenance and replacement that identifies the current day value of the assets as well as defines the need for increased revenue over time for the long-term management of the assets.
  7. CAPITAL IMPROVEMENT INVESTMENT PLAN (CIIP) – A summary of findings on asset condition and need for replacement should be used to develop a CIIP so the community can schedule repairs and replacements in a logical manner while managing the financial impacts to the community.
  8. IMPLEMENTATION PLAN – Develop an implementation plan that describes how the community will continue to maintain and use the asset management program and how the community will incorporate energy and water conservation into day to day operations.
  9. COMMUNICATION PLAN – Prepare a communication plan using the most effective methods to communicate to stakeholders the benefits of the asset management program and its capabilities.

To learn out more about the Asset Management services we provide to our clients please contact Joe Ducharme, Jr., PE, Regional Manager for our Northeast Municipal Engineering Group.