Gmf leadership inassetmanagementprogramoverview
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This document provides an overview of the Green Municipal Fund's new Leadership in Asset Management Program (LAMP). The program aims to help municipalities better integrate asset management into their sustainability goals and decision-making. It will provide funding and technical support for projects focused on asset management policy, strategy, governance, levels of service, risk assessment, or lifecycle management. The program is intended for both smaller and larger municipalities and will involve collaboration between participating municipalities. It will launch in April 2015 and accept applications from interested municipalities.
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Gmf leadership inassetmanagementprogramoverview
- 1. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT Sneak Preview: GMF Leadership in Asset Management Program (LAMP) Donna Chiarelli, Senior Advisor, Knowledge Services, FCM’s Green Municipal Fund Karen Miller, Program Officer, Knowledge Services, FCM’s Green Municipal Fund 30/01/2015 GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT 1
- 2. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT TODAY’S WEBINAR 2 Introduction to FCM and GMF GMF Leadership in Asset Management Program – What is it all about? Why are we doing it? Who is it for? Questions and Discussion Introduction to the Canadian Network of Asset Managers (CNAM), a national resource on asset management
- 3. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT 3
- 4. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT 4
- 5. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT 5
- 6. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT NEW OFFER will launch APRIL 1ST, 2015 6
- 7. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT For more information about GMF Call: 613-907-6208 or 1-877-997-9926 Email: gmf@fcm.ca Subscribe to our e-newsletter: www.fcm.ca/gmf Follow us: 7
- 8. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT A New Program Focus for GMF Asset Management An integrated business approach involving planning, finance, engineering and operations to effectively manage existing and new infrastructure to maximize benefits, reduce risk and provide satisfactory levels of service to community users in a socially, environmentally and economically sustainable manner - from An Asset Management Governance Framework for Canada, National Asset Management Working Group, February 2009. 8
- 9. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT New GMF Program Focus on Asset Management • Foundation for improved decision making about infrastructure investments • Asset management is still a young discipline in Canada, limited uptake in many provinces • Where it is being done, organizational adoption of asset management is still limited; weak integration with corporate sustainability planning and goals 9
- 10. 10 GMF: A Small Fish in a Big Sea, the Tip of the Iceberg GMF: $65m loans and $11m grants $750k capacity building > $100b infrastructure deficit $53b federal investment (next 10 yrs) $billions in provincial and municipal investment
- 11. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT 2012-14 GMF Market Research: Municipal Priorities Info Tools Resources Peers Innovative Financing Resilience wastewater energy revitalization Sector integration in project design Optimization of decision making Improved environmental performance of core services 11
- 12. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT GMF Leadership in Asset Management Program (LAMP) Program seeks to address four main barriers that commonly limit integration of asset management with municipal sustainability goals and optimal decisions: 1) Organizational adoption of asset management 2) Linking assets to services and outcomes 3) Developing more robust risk frameworks 4) Incorporating lifecycle management GMF grant maximum of $175K per participating municipality, to be approved when they are selected to participate (50% of total project costs) 12
- 13. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT Key Feature of LAMP: Combines GMF project funding with a peer learning program Objectives: • To work together & build a supportive peer network • To generate innovative, good practices in asset management that demonstrate strong integration with municipal sustainability goals and targets 13 • To develop frameworks, practices and tools that will be shared nationally through FCM/GMF and national AM networks.
- 14. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT Is the program for municipal governments only? • Yes, only municipal governments are eligible to participate. Is the program for large municipalities only? • Seeking a range of municipal sizes, population doesn’t matter • BUT: minimum project team of 3 municipal staff will be required to participate Does my municipality need to be advanced in asset management? • Program has been designed for municipalities at both very early stage or advanced in asset management • Demonstrated progress in implementing a corporate sustainability plan is required Is There A Regional Focus ? • Seeking regional balance across Canada • 5 – 10 Anglophone municipalities in 2015-16 • 5 – 10 Francophone municipalities in 2016-2017 Who is the Program For?
- 15. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT Features Phase I (Required) Phase 2 (Optional) Project Focus AM Policy, Strategy, and Governance Framework Levels of Service, Risk Assessment or Life Cycle Management Format Participants work together; high degree of collaboration and peer learning Project is unique; municipality works alone or in a cluster by choice Technical Support Participants collaborate with a common institution they select together Institution selected by single municipality or cluster Estimated timeline About 18 months from program inception About 9-24 months; depends on complexity and scope Approximate total project value Estimated up to $65,000 Estimated to range between $50,000 and $300,000 LAMP Program Structure and Format
- 16. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT FCM’s Green Municipal Fund Supporting Institution Coordinate up to two face-to-face meetings of participants per year Consulting services delivered in a group context at face-to-face meetings, to support achievement of Phase 1 project Host and coordinate regular online meetings and online collaboration Consulting services delivered in a group context through webinars Program monitoring and evaluation One-on-one consulting services to support each participating municipality in implementing Phase 1 project Collaboration and Learning in Phase 1
- 17. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT March 2015 Begin Recruitment and Intake of Applications Late June 2015 Deadline to submit applications September 2015 Selection of Anglophone Cohort Oct/Nov 2015 First face-to-face meeting of participants Next Steps
- 18. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT Questions? Contact: Donna Chiarelli, Senior Advisor, Knowledge Services, FCM Green Municipal Fund Email: dchiarelli@fcm.ca Phone: 613-907-6315 ** Please email Donna if you would like to be notified when recruitment begins in March 18
- 19. GREEN MUNICIPAL FUND | FONDS MUNICIPAL VERT Discussion questions • Feb. 10th to 12th in London, ON • Full day advanced trainings and study tours: Feb. 10th • Register today! www.fcm.ca/scc Sharing Failures: What it takes to learn from what didn't work Ashley Good, CEO, Fail Forward Instilling a Sustainability Mindset within Your City Hall Bob Willard, Author and Speaker, Sustainability Advantage Building momentum for sustainability Jennifer Keesmaat, Chief Planner, City of Toronto 19
Editor's Notes
- The Federation of Canadian Municipalities has been representing the interests of municipalities at the federal level since 1901. We work to strengthen the role and capacities of municipal government in order to foster communities that are economically viable, socially cohesive and environmentally sustainable. We represent almost 2,000 members, representing over 90% of the Canadian population.
- One of FCM’s flagship programs is the Green Municipal Fund, which was established thanks to a $550 million endowment of the Government of Canada. The fund provides funding and knowledge resources to enhance municipal initiatives that benefit the environment, local economies and quality of life. We fund the very best examples of leadership and innovation in municipal sustainable development in five sectors: brownfields, energy, transportation, waste and water. These initiatives must aim to achieve significant environmental impact and have the potential to be replicated in other communities.
- GMF funding is available to all municipal governments and their partners in eligible projects. Who is eligible to receive GMF funding? Municipal governments Municipally-owned corporations and private-sector partners (contact us for further details)
- Talk about this program as a pilot, a new approach that is fully integrating the funding we provide for innovative projects with the knowledge services we deliver to build capacity of the municipal sector Before we delve into the reasons why GMF has developed a program in this area and what it’s all about, I’d like to share a definition of asset management that we find particularly useful, especially in understanding its relationship to sustainability. How many people feel like they have a good understanding of the concept of asset management – hands up for yes and hands down for no. For those who don’t – there are lots of good resources out there that explain the basics quite well. One suggestion would be to check out the website of the Canadian Network of Asset Managers website, where they have posted a short primer on asset management. Asset management BC also has a wealth of resources on asset management and has recently developed a framework for asset management for BC municipalities, available on its website. You should also know that there are internationally recognized best practices for asset management such as the International Infrastructure Management Manual and the new ISO 55000 Standard for Asset Management. Next slide
- Essentially, asset management is a foundation for improved decision making about infrastructure investments [re third bullet] This is where GMF has decided to focus its efforts
- GMF has undergone a period of reflection and analysis over the last couple of years in the lead up to the new GMF Offer that Karen mentioned in her introduction to GMF. Even though GMF is a very small infrastructure fund, our aim is to support and inspire better planning for the big infrastructure investments that will be made in the coming decade, to ensure the best possible social, environmental and economic outcomes for communities across Canada. We are at a critical juncture at this point in time, with concerns about climate change and environmental health, and constrained financial resources to deal with significant infrastructure challenges – so every dollar needs to be invested optimally to ensure our long-term well-being. Asset management is an important vehicle to support good governance and decision making about these investments.
- I’d like to share with you the highlights of the market research we’ve undertaken recently, that describe current priorities that municipalities would like to see supported through GMF. [read through the priorities] Ultimately our new focus on asset management will support a number of these areas; and particularly the priority around optimization of decision making Asset management as an exercise involves analysis that ultimately leads to more sustainable choices. This includes not only choosing the right time to intervene on a particular asset but also demonstrating the full value of retrofit and replacement solutions that have high environmental performance. When municipalities manage infrastructure without sound asset management practice in place, they are likely incurring social, environmental and economic costs that may have otherwise been avoided, because they are not necessarily prioritizing the right investments at the right time over the life cycle of the asset. They may also not be accounting for the full cost of planning decisions that require building and maintaining expensive new infrastructure. Decisions they make today may not be aligned well with the goals set with the community in their sustainability plans. There are significant social, environmental and economic gains to be made by helping support the adoption of asset management practice in the municipal sector in Canada. In applying it, communities across Canada will be better positioned to make their infrastructure dollars go further, with a lighter environmental footprint.
- Research and consultation: Last Spring: review or literature and key informant interviews Focus group discussion with board of directors of CNAM (May 2014) Program design workshop in late June 2014 Program validation workshop in Fall 2014
- Over the years, GMF has funded many integrated community sustainability plans, many of which set out ambitious high level goals and targets for their communities – our role in strengthening asset management will help to support the implementation of these plans, by aligning the decisions being made about infrastructure investments with them. Focus group last year validated that sustainability directors and coordinators aren’t well connected to asset managers in their municipalities
- To undertake Phase 1 of the program, municipalities will be provided with a GMF grant to support them in developing an asset management strategy, policy and governance structure that are: • Consistent with the strategic goals of the organization; • Fully integrated with the sustainability goals (including environmental sustainability goals) of the organization; and • Consistently use a common philosophy and language and template across the participating municipalities. A formal policy and strategy reinforces an organization’s commitment and goals with respect to asset management, and their relationship to sustainability, business and service delivery objectives. It lays out (at a high level) the principles and practices it will follow to realize these goals. In addition to reinforcing the need for prudent financial management (economic outcomes), these documents often formalize the commitment toward sustainable levels of service (social outcomes), and stewardship for the environment (environmental outcomes) in infrastructure related plans and decisions. The challenge we are trying to address here is that most municipalities lack a strategic plan for managing their assets, using performance metrics; something that will enable them to link their asset management with corporate strategy. The implications: there is a limited and inconsistent understanding of what AM is and its role in municipal decision-making, particularly in smaller communities. Internally, departments responsible for different assets are not talking to each other, using a comparable approach to assess needs and communicate effectively to council. Risks Council making less than optimal decisions because they don’t fully understand the range of needs and how to prioritize them. This can result in political decisions based on public pressure to address more visible problems – which may not yield optimal social, environmental or economic outcomes. Phase 2: Municipalities will have the option of applying to undertake a Phase 2 project when they apply to the program. Phase 2 projects funded through LAMP will support participating municipalities in advancing in one of three priority areas of the program, while ensuring their progress is aligned with the asset management policy and strategy they developed in Phase 1. The total grant funding available to complete both the Phase 1 and Phase 2 projects is $175,000, where GMF covers a maximum of 50% of total eligible project costs. Assuming municipalities will use up to $32,500 in grant funding for their Phase 1 project, the balance could be accessed for Phase 2 projects. GMF intends to provide opportunities for smaller municipalities or those that are new to asset management to participate in Phase 2 of the program. Basic projects may be proposed that are geared towards supporting municipalities starting out at an earlier stage in their asset management planning, and could be undertaken at a relatively low cost (around $50,000 in total project costs). Municipalities that have already made substantial progress in asset management may propose to tackle more challenging issues. We will be supporting projects that aim to strengthen levels of service frameworks. A levels of service framework is an important element in building a strategic asset management program, because it can ensure an integrated approach from the corporate performance vision, down to day-to-day asset management decision making. The barrier currently is that defined Levels of Service Metrics Aren't Standardized and the Service Level Conversation Gets Very Technical very fast. This means that the public and political conversation about AM is Limited, and long-term, strategic decisions can be overlooked. Decisions are based on managing the asset as opposed to the service. There are no standard, meaningful metrics with which to assess and seek agreement from the community on level of service; where experts agree. Having level of service metrics that are meaningful to council & citizens can lead to real conversations. This will support municipalities in linking policy to service requirements and municipal corporate strategy. We will also be supporting municipalities to develop more robust risk frameworks. Risk management is a fundamental component of an asset management system. Historically, investment decisions may have been based on the condition of assets, but when many assets are in poor condition, which is the priority? The barrier is that AM planning is not fully integrating risk and vulnerability considerations (i.e. extreme weather and all other risks). The implications are that sub-optimal decision making because decisions are not based on a standard risk assessment framework that takes into account all risks and consequences of action or inaction. More robust assessment frameworks will lead to decisions that better account for full risks and consequences; will enable more informed public and political discussion about priorities and trade-offs. Finally, we will support municipalities to incorporate lifecycle management into their asset management practice: The barrier is that investment decision-making methods within municipalities can vary widely across departments and across projects within a department. There is a tendency to focus on initial capital costs and often it is only the largest investments that have more rigorous cost-benefit approaches. So options are often evaluated and decisions made based on short-term considerations, as opposed to understanding the full economic, social and environmental costs and benefits of the project over the lifecycle of the asset. As a result, many opportunities offering long-term or less tangible benefits may be overlooked in favour of short-term, visible wins. This can lead to lost opportunities and a burden that is handed over to the next generation. By supporting the incorporation of LCA into AM practice we will be supporting better integration of municipal goals and policies with asset management planning. This can bring otherwise hidden environmental and social costs and benefits into the decision making process. For a municipality to be able to undertake an advanced project, they will need to demonstrate they have sufficient maturity in implementing asset management to undertake the project. As part of the application process, all applicants will be asked to complete an asset management self-assessment, using an asset management maturity matrix that has been developed for the program (see attached document, Asset Management Maturity Matrix, Appendix A).
- Knowledge services: workshops, webinars, knowledge products, SC Awards, SCC