Asset Management
Policies And Programs To Preserve Valuable Assets
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Victoria Transport Policy Institute
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Updated 2 April 2014
This chapter describes Asset Management, which refers to policies and programs to preserve the long-term value of physical assets.
Asset Management refers to special policies and programs designed to preserve the long-term value of assets such as vehicles, roads, transit systems and buildings. It emphasizes careful planning, preventive maintenance and resource management, rather than waiting for problems to develop before responding. Asset Management tends to give more consideration to the efficient operation and management of existing transportation facilities and systems, and so tends to support TDM. It is important for all forms of transportation, including nonmotorized, transit and roadway equipment and facilities.
Asset Management typically requires:
· Identifying the organization and individual responsible for managing each asset.
· Detailed lifecycle cost analysis (that is, taking into account total costs over each assets operating life) during planning and procurement, so options with the lowest overall long-term costs can be selected.
· Institutional Reforms to correct biases that favor new construction and capacity expansion over operations, maintenance and management of existing facilities.
· “Fix It First” policies, which mean that maintenance, operations and incremental improvements to existing infrastructure is given priority over construction of new facilities.
· Establishing preventive maintenance and replacement schedules.
· Training and certifying operating and maintenance staff.
· Having appropriate tools and replacement parts available for each asset.
· Establishing and enforcing restrictions on damage-causing activities, such as operation of overweight vehicles.
Asset Management often results in higher design, construction and repair standards (so equipment and facilities last longer), and increased funding for maintenance and minor repairs (to prevent minor deterioration from becoming severe). This type of preventive maintenance tends to reduce lifecycle costs as well as improve travel conditions, reliability and safety. Asset Management reflect Least Cost Planning and Sustainability principles.
Asset management is usually implemented by organizations responsible for transportation facilities, including transportation agencies, transit agencies, road authorities and municipal engineering departments. It can also be implemented by private organizations, such as a bus or taxi company.
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An elderly lady returned from shopping to find four young men sitting in her car. She dropped her bags, drew a handgun, and proceeded to scream at the top of her voice that she will shoot each of them if they don’t leave the car immediately. The four men leapt from the car and ran down the street. The lady then loaded her shopping bags into the car and got into the driver’s seat. But her key wouldn’t fit the ignition. Then she noticed an identical car parked a few spaces away. She moved her bags into her car and drove to the police station. The sergeant to whom she told the story pointed to the other end of the counter where four pale young men were reporting a carjacking by a mad elderly woman. No charges were filed. |
TRB (2004), Pagano, McNeil and Ogard (2005) and the Transportation Asset Management Today (http://assetmanagement.transportation.org) provide guidance on transportation asset management best practices.
The FHWA Asset Management Website (www.fhwa.dot.gov/infrastructure/asstmgmt) includes a variety of case studies. Below are some examples.
Since 2000, the Colorado Department of Transportation (CDOT) has undertaken several important initiatives designed to improve transportation planning, decisionmaking, and resource allocation. Today, CDOT recognizes that data integration plays a critical role in improving business processes and managing assets. Thanks to institutional policy changes and forward-thinking information technology planning, the department is successfully integrating data to support Asset Management.
CDOT approached the issue of data integration to support Asset Management from both the policy and information technology perspectives. On a policy level, CDOT has been reorganizing its business planning processes since the early 1990s by defining investment categories and associated performance measures. CDOT also officially recognized Asset Management as a critical function within the department by appointing an Asset Management Task Force. These institutional actions set the stage for connecting departmental goals with business planning to ensure efficient allocation of resources. At the same time, the Information Technology branch of CDOT has been working to better serve this business approach by providing more efficient information transfer across asset and program areas.
Several decades ago, New York was among the first States to automate its highway information systems and to apply economic analysis in considering highway investments. Through the 1980s and 1990s, the New York State Department of Transportation (NYSDOT) endeavored to upgrade and strengthen its analytical abilities. It initiated management reforms that established clear lines of management responsibility, implemented goal-oriented programming, improved its management systems, and integrated the agency's information systems. These efforts created a solid foundation for the implementation of a Transportation Asset Management (TAM) system.
In 1997, NYSDOT created an internal task force to prepare a blueprint for advancing the implementation of TAM. An important finding of the task force was that the ability to conduct economic tradeoff analysis among investment candidates is central to realizing the full potential of TAM. NYSDOT has since developed a prototype TAM Tradeoff Model that employs economic tradeoff analysis to compare the dollar value of customer benefits to investment costs among competing investment candidates. The model ranks the candidate projects by rate of return on investment. When it is fully operational, the model will assist NYSDOT at the program level in targeting agency resources more productively among its pavement, bridge, safety, and mobility goal areas.
NYSDOT continues to improve the prototype TAM Tradeoff Model as well as the separate management systems that feed data into it. The department is exploring ways to incorporate additional life-cycle cost and benefit data into the model equations and taking steps to ensure that economic comparisons among projects use consistent values for benefit and cost elements. Simultaneously, NYSDOT continues to improve its project-level economic applications. In May 2003, NYSDOT announced that it would formally implement a TAM program as the department's transportation infrastructure management strategy. Economic, engineering, and mathematical analysis will constitute the core of this program.
Since 1991, the Oregon Department of Transportation (ODOT) has used computer models to support its investment decision-making processes. Initially, Oregon relied on the Highway Performance Monitoring System Analytical Process (HPMS AP). The HPMS AP is an investment/performance simulation model designed to predict the investment required to correct current and future highway system deficiencies. This approach relies primarily on engineering considerations and only marginally considers the highway user. While developing its 1999 Oregon Highway Plan, ODOT decided to change their methodology to one that incorporated economics and the impact of investment decisions on highway users.
At about this time, ODOT became aware of the Highway Economic Requirements System (HERS), a new investment/performance model that had just been introduced by the U.S. Department of Transportation (USDOT) for use at the Federal level. The HERS differs from the HPMS AP in that it incorporates economics into its investment selection simulation procedures. Initially, the national version of HERS was not available for State use, but ODOT obtained a copy through a contractor working on the update of its Highway Plan. ODOT worked closely with the contractor in modifying the software to make it useful as a State-level planning tool. The revised program, which came to be known as HERS-OR, was successfully used in producing the 1999 Oregon Highway Plan. ODOT continues to use the HERS model for selected planning and policy analyses, and envisions significant new applications in the future.
ODOT is one of the first States to use the HERS model for planning and policy analysis at the State level. Recently, Oregon has begun to upgrade from HERS-OR to HERS-ST, the State-level HERS model supported by USDOT. HERS-ST has most of the features of HERS-OR, but also has updated formulas and calculations and is considerably more user friendly.
State Departments of Transportation are integrating electronic databases and software applications to achieve efficiencies and meet their performance goals. California, Florida, and South Dakota have been making progressive inroads using the Pontis® Bridge Management System, and here they share their approaches as a guide for other States who want to do the same.
All the information necessary to manage the integrity of California's bridge infrastructure is contained in a single database with sharing features achieved using the Pontis® data structure. Pontis® is used not only to generate bridge reports, but is also accessed by district maintenance crews, project planners, Caltrans management, and the California Transportation Commission for their various lists and reports.
Florida has simplified management and found cost-effective solutions by integrating Pontis® with the Citrix® MetaFrame Access Suite and the Project-Level Analysis Tool (PLAT). Citrix® MetaFrame is a Web tool for bridge inspections that efficiently provides users a single point of access from any location, for any number of people, using many devices, over any connection. PLAT is a decision support system tool that makes routine policy, programming, and budgeting decisions regarding preservation and improvement of the State's bridges.
Like all States, South Dakota's goal is to preserve their aging structures. Pontis® is a valuable tool in this regard because it calculates the rate of deterioration for all the various bridge materials such as concrete, prestressed concrete, steel, and timber. The South Dakota Department of Transportation saved approximately 900 annual man-hours in labor by customizing the Pontis® check-out/check-in process and abandoning their previous practice of entering inspection data from paper forms.
Austroads Asset Management Reference Group (AMRG) (www.austroads.com.au/amrg.php) supports efforts by Austroads Member Agencies in managing road assets at the lowest whole-of-life cost (agency costs and road user costs) as a means of improving effectiveness in the delivery of broad community transport objectives.
Asset Management Website (www.fhwa.dot.gov/infrastructure/asstmgmt), Federal Highway Administration, provides information on roadway asset management programs and tools.
Cambridge Systematics, PB Consult and System Metrics Group (2005), Analytical Tools for Asset Management, National Cooperative Highway Research Program (NCHRP) Report 545 (http://trb.org/publications/nchrp/nchrp_rpt_545.pdf).
FCM (2002), Ahead of the Wave: A Guide To Sustainable Asset Management For Canadian Municipalities, Federation of Canadian Municipalities (www.sustainablecommunities.ca/files/pdf/sustainable_asset_management_guide_final.pdf).
FHWA (1999), Asset Management Manual, Office of Asset Management, Federal Highway Administration (http://gulliver.trb.org/news/blurb_detail.asp?ID=1427).
FHWA (2001), Economic Analysis Primer, Office of Asset Management, Federal Highway Administration (wwwcf.fhwa.dot.gov/infrastructure/asstmgmt/primer.htm).
FHWA (2000), GASB 34 Primer, Office of Asset Management, Federal Highway Administration (http://199.79.179.19/OLPFiles/FHWA/010019.pdf). Provides information on the US Governmental Accounting Standards Board’s Statement 34: Basic Financial Statements-and Management's Discussion and Analysis-for State and Local Governments
FHWA (2000), Insights into Pavement Preservation: A Compendium, Office of Asset Management, FHWA (www.fhwa.dot.gov/infrastructure/asstmgmt/compend.pdf).
FHWA (2002), Lifecycle Cost Analysis Primer, Office of Asset Management, FHWA (http://199.79.179.19/OLPFiles/FHWA/010621.pdf).
FHWA (2003), Improving Transportation Investment Decisions Through Life-Cycle Cost Analysis, Office of Asset Management, FHWA (www.fhwa.dot.gov/infrastructure/asstmgmt/lccafact.htm).
Gerardo W. Flintsch (2008), “Sustainable Transportation Infrastructure Management,” Environmentally Conscious Transportation (Myer Kutz, Ed.), Wiley Series in Environmentally Conscious Engineering (www.wiley.com), pp. 257-282.
Ottawa (2003), Transportation Master Plan – Chapter 13, City of Ottawa (http://ottawa2020.com/_en/growthmanagement/op/tmpjul/tmp13.shtml).
Anthony Pagano, Sue McNeil and Elizabeth Ogard (2005), “Linking Asset Management To Strategic Planning Processes: Best Practices For State Departments Of Transportation,” Transportation Research Record 1924, TRB (www.trb.org), pp. 184-191.
Shelly J. Row (2003), “The National Transportation Operations Coalition: Moving From Dialogue to Action,” ITE Journal, Vol. 73, No. 12, Institute of Transportation Engineers (www.ite.org), December 2003, pp. 28-31.
Transportation Asset Management Today (http://assetmanagement.transportation.org) is a website sponsored by the AASHTO (American Association of State Highway and Transportation Officials) Task Force on Transportation Asset Management, includes a variety of information resources.
TRB (2004), Transportation Asset Management Guide, NCHRP Project 20-24, Transportation Research Board (www.trb.org) and AASHTO (www.aashto.org).
Jeromie Winsor, et al. (2004), “Transportation Asset Management Today: Communities of Practice In The Transportation Industry,” Transportation Research Record 1885, Transportation Research Board (www.trb.org), pp. 88-95.
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