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Asset Management Overview

Current Practices in Transportation Asset Management

There is no single method for implementing Transportation Asset Management. Transportation agencies differ in terms of their needs and resources and in the complexity of their systems. Typically, the first step toward implementation involves some realization that a need for change exists. However, change does not happen until people within the agency, particularly leaders at the top, find a reason for change.

Actually taking the first step is typically difficult because it involves figuring out what needs to be done. There is no prescribed series of steps for implementing agencies to follow; rather, agencies who have been successful have found the approaches and practices that are most appropriate for their unique set of circumstances. Examples are documented in the reports of recent domestic9 and international10 scanning programs that reviewed Transportation Asset Management practices in agencies in Canada, England, Australia, and New Zealand. For the United States, more detailed experiences of State and local highway agencies with the implementation of asset management programs appear in a series of case studies published by FHWA's Office of Asset Management.11 Following are some real-life examples from local governments, State DOTs, and international organizations of their experiences in developing and implementing Transportation Asset Management programs.

Local Government Experience

In the United States, local governments - counties and municipalities - own more than 75 percent of the Nation's nearly 4 billion miles of roadway and over half of its nearly 600,000 bridges.12 Because local governments typically have fewer independent systems for managing assets than State DOTs, they often have a much broader view of infrastructure assets and the goals that can be achieved through effective management of those assets. As a result, these smaller agencies may also have a greater variety of criteria and standards for judging the performance of their assets. In addition, local government agencies depend on a variety of funding sources to support the development and management of transportation assets, and typically have few resources to invest in asset management programs. Because of the large number of local government agencies in the country and the variation in the responsibilities and resources of each agency, the approaches they take to infrastructure asset management vary greatly.

Cole County, Jefferson City, Missouri

The Cole County Public Works Department has cited two reasons for moving toward asset management. The first was the agency's dependence on the experiences and memories of its workers. As workers aged and retired, the county's management information systems were literally walking out the door. Asset management provided tools that could be used to capture some of that information before the workforce retired. The second reason, which is frequently reported by agencies, was the county's need to comply with the provisions of GASB Statement 34. The new accounting rules highlighted the importance of assets and provided an opportunity to improve management procedures while meeting the reporting requirements.

With the introduction of GASB Statement 34 providing an added impetus for change in the county's asset management practices, county staff explored available "canned" software packages that could facilitate the initial inventorying and condition assessment of the county's transportation assets. The packages considered had broad scopes - to accommodate a range of agencies and assets - and were flexible, with all the "bells and whistles" to support various functions. Purchasing such a package would offer technical support to the county staff during management system implementation. However, the packages were costly and complicated, and would require periodic staff training to keep up with new capabilities as the software was upgraded. The county decided instead to develop its own software, with help from the University of Missouri, a local institution.

The new software, designed to be simple to use and maintain, was based on a spreadsheet model, with inventory data collected using inexpensive global positioning system (GPS) devices purchased at a local electronics store. University graduate students were employed to gather the initial data. The most complex task was designing the unique identifier "tag" to be used to designate specific assets. The county adopted a five-digit identifier.

Roadway types and other characteristics were defined using existing county procedures. Pavements were visually inspected, and condition ratings were assigned on a five-point scale from "excellent" (5) to "failed" (1). Specific pavement distress and drainage conditions were also recorded. Drainage structures, traffic signage, and guardrail were inventoried and rated for condition. Bridges were inventoried but not rated, because the State DOT rates all "off system" bridges every 2 years.

The new software is used to evaluate upcoming maintenance needs by reviewing conditions and using standard performance prediction curves. Analyses are then made of the estimated costs to maintain or improve system components with current maintenance techniques and also to extend or preserve service life with different maintenance techniques. These estimates are used to develop 3- to 5-year maintenance projections and capital improvement programming.

The county's Transportation Asset Management program provides information that increases the agency's accountability for the performance of county assets. Because infrastructure conditions have been maintained or improved, the county has found that taxpayers have grown accustomed to the new level of service and expect it to be maintained. The asset management program helps the county address this expectation by providing a basis for discussing tax rates that will assure adequate funding of maintenance and system preservation for the levels of service expected by the public.

City of Redmond, Washington

The City of Redmond developed a Transportation Asset Management strategy with particular regard for compliance with GASB Statement 34 reporting requirements. Redmond's roadway system is relatively young, and its Council was inclined to allocate adequate funds for improvements to maintain the useful life of this infrastructure.

Besides the streets themselves, the system includes signs, curbs and gutters, and right-of-way. These assets are tracked in the city's geographic information system (GIS). Streetlights and traffic signals are reported in a separate asset listing. Hiking and biking trails are also included among the transportation assets the Public Works Department manages, but they are managed in a separate module.

Redmond's asset management program currently has four principal elements: a GIS, pavement management system, park trail tracking system, and project cost system. Considerable effort was devoted to strategic planning when the system was established and, subsequently, to education and training of the GIS, engineering, and financial technicians who maintain the system. Similarly, considerable effort is dedicated to keeping the information system current and compatible with the State's financial reporting system, particularly with respect to capital projects, contributed assets (e.g., facilities or rights-of-way), and abandoned assets.

Every 2 years, the city contracts with Measurement Research Corporation to rate the entire street system. The contractor "walks the streets" of Redmond and assesses condition according to State standards that reflect the number of potholes and alligator and other cracks. Based on a rating scale where 100 represents perfect conditions, the city's roads typically average a rating of about 83. Using these ratings, an analysis is made to estimate the remaining service life of particular streets and the system in its entirety. In addition, this information is used to establish a monetary value of the street system.

When the current value of existing assets was initially established, the city put in place a process to keep this information current. The Public Works Department assigned a staff member to monitor all capital projects (including substantial resurfacing). As projects are completed, this staff person is charged with reporting the value - based on total project cost - of new or improved infrastructures to the GIS team. The value of infrastructure contributed to the city or abandoned is estimated by the construction division and reported to this staff person, who relays the asset information to the GIS team.

By building on existing management systems and involving all staff who would be responsible for providing and maintaining data, the city was able to implement a Transportation Asset Management program without imposing much stress on the organization.

Common Issues Raised by Local Governments

Local governments across the country have raised a number of issues13 encountered in their implementation of asset management programs:

  • Getting management and staff commitment is an important requirement for successful adoption of asset management philosophy and principles.
  • Building and maintaining the asset inventory is a necessary first step, and it may be accomplished by progressively drawing on available information while conducting in-field surveys.
  • Asset condition assessment and valuation may be accomplished at several levels of sophistication without compromising the value of the asset management program as a decisionmaking tool.
  • Asset management "programs" may be based on simple spreadsheets, as well as sophisticated database management packages, to match the needs and resources of the agency.
  • Condition monitoring and maintenance of asset inventory data are essential to maintaining the validity of the asset management program, and they require a continual commitment from management.
  • Intermodal comparisons - i.e., establishing priorities among different functional asset classes for resource allocation - can be supported by the asset management program.
  • Standards regarding satisfactory or acceptable levels of service for infrastructure assets may vary substantially from one community to another.
  • Sharing of information among departments and establishing common databases are effective ways to reduce the costs associated with the implementation of an asset management program and improve the quality of management information. Existing data, such as property assessment records, can be used as a basis for setting up the asset management program.
  • Asset management tools need to be simple if they are to be used over an extended period of time; the tools need to be easily understandable, adaptable to the user's specific interests, and easy to operate without entailing lengthy, tedious activities for data entry, formatting, and other routine operations.

Payoffs have accompanied the adoption of Transportation Asset Management practices. Counties have reported, among other benefits, enhanced support by citizens and elected officials for preventive maintenance activities, a net reduction in agency costs for managing the roadway network, and improved asset conditions.

State Department of Transportation Experience

Most State highway agencies have some of the systems that provide information used in the asset management process, most commonly pavement and bridge management systems that monitor conditions, measure performance, predict trends, and recommend candidate projects and preservation treatments. Many are also using analytical tools to compare the relative merits - and risks - of alternative policies, programs, and projects. Still others have linked their asset management efforts to their State's long-range transportation planning process. Florida, Maryland, Michigan, and Pennsylvania serve as examples of the widely varying ways in which State DOTs are approaching asset management.

Florida

Florida has managed its transportation assets through a strategic planning process referred to as "program and policy planning." The DOT has no asset management department, but its approach to decisionmaking, investment analysis, and management of transportation assets spans the department's agencies, from planning and financial management to maintenance, bridge, and pavement offices. A continuous process links policies with financial planning, programming, and performance monitoring. Performance measurements lead to appropriate decisions regarding funding levels and adjustment of plans and policies to begin a new cycle of planning. The Office of Planning is responsible for evaluating and reporting the results of monitoring against goals and objectives.

Asset management comprises the entire process from programming and planning to preservation of the system and is characterized by a solid policy framework, measurable objectives, and continuous performance monitoring. This process results in sound investment decisions with a customer focus. The asset management concepts of data-supported decisionmaking, management systems, strong relationships between condition and performance, and an emphasis on tradeoff and investment analysis are integral components of daily business that support the department's mission - to provide a safe transportation system that ensures the mobility of people and goods, enhances economic prosperity, and preserves the quality of Florida's environment and communities. These concepts are part of the culture and are strongly supported by upper management.

Photo. Aerial view of a complex of elevated interchanges.

In Florida, asset management begins with a strong statutory policy framework documented in the Florida Transportation Plan, which has a 20-year timeframe. A more detailed Program and Resource Plan sets forth specific operating polices and performance measures that guide the development of each program. The 10-year Program and Resource Plan contains program funding levels and financial and production targets that are balanced to anticipated revenues. A 5-year listing of projects (called the Work Program14) is developed annually, based on the Florida Transportation Plan, Program and Resource Plan, extensive district and public involvement, and, ultimately, decisionmaking by a strong executive board at the department.

The 5-year Work Program is reviewed, revised as necessary, and extended each year. Data collected by each district's performance monitoring programs and regional planning information are used to develop a list of projects and estimated funds that will be needed to maintain the State's performance standards for highways and bridges. Metropolitan planning organizations (MPOs) participate in this process. At the State level, these data and project lists are aggregated for executive board review. The executive board allocates funds to each district in proportion to the district's percentage of deficient lane-miles and bridges. Working with these allocations, the districts in turn determine how best to use the funds at their disposal. Life-cycle cost analysis at the district level helps decisionmakers to fit the right treatments to specific projects.

Florida has decided that preservation of highway investments will be "taken off the top." That is, it is critical to maintain existing assets before investing in new system capacity. From an asset management perspective, this ensures that roads and bridges are maintained at current value and provide the best product to the traveling public. Preservation is divided into three categories: pavement, bridge, and routine maintenance. Each has an extensive inventory-driven, performance-based, management system that allows investment decisions to be based on real needs and priorities. Monitoring and standards for each system are as follows:15

  • Pavement Management System - An annual pavement condition survey is conducted to evaluate ride quality, crack severity, and average depth of wheelpath ruts. A rating of 6 or less on a 10-point scale in any of these areas causes a pavement segment to be declared eligible for treatment. The pavement condition objective is that at least 80 percent of the State Highway System lane-miles are of sufficient quality to meet department standards; in mid 2007, 83.5 percent met the standards. Decisions concerning whether a preservation treatment, repaving, or reconstruction is most cost effective for a pavement segment are informed by life-cycle cost analysis. These analyses at the district level help to establish priorities for maintenance and replacement for the eligible projects within available funds.
  • Bridge Management System - Each of the 6,409 State-owned and -maintained bridges and about 5,039 other bridges is inspected every 2 years to identify which need preventative maintenance, minor or major repair work, or replacement. A bridge that meets department standards is defined as not showing evidence of structural deterioration, not being limited by weight restrictions, and not needing preventative maintenance. The objective is that 90 percent of department-maintained bridges must be kept at a level that meets these standards; in mid 2007, 93 percent met the standards.
  • Maintenance Rating Program - State highway maintenance condition is based on a sampling process that rates five primary categories of highway environment three times a year. The items rated are roadway (potholes, etc.), roadside (shoulders), vegetation and aesthetics (mowing, litter removal), traffic services (signs, lighting), and drainage (ditches). Each category is rated, and the overall maintenance condition is calculated. A maintenance rating of 80 is considered acceptable. The department's objective is to ensure that 100 percent of the State Highway System meets the maintenance standard; currently, this standard is being met.

Only after all preservation and public transportation dollars have been allocated are capacity dollars programmed. Another "off the top" allocation of at least 50 percent of all highway capacity dollars goes to the Florida Strategic Intermodal System. This statutory requirement ensures that the goals of mobility and economic prosperity are supported. A decision support system is used as a tool to support investment decisions, and the relative needs for improvement are based on five variables: pavement condition, congestion, safety, intermodal connectivity, and economic development. Mobility performance measures of quantity and quality of service, accessibility, and utilization of the system are also used. Included within these variables are level of service, vehicle miles traveled, and percentage of system heavily congested. In addition, Florida has developed a bottom-up process of incorporating input from many active MPOs for the purpose of decisionmaking in the areas of budgeting, performance monitoring, and project priority selection.

The characteristics that ensure success of the department's asset management process are statutory authority, management commitment, and high-quality data, and the fact that the process is needs based. The process allows for assessing tradeoffs in decisions and includes prediction measures and trend indicators. At the policy level, the executive board assesses tradeoffs that affect funding levels and determines the desired outcomes state-wide, whereas, at the district level, program and project life-cycle cost analysis help determine priorities and methods within the funding constraints and the condition objectives set at the State level. In summary, the Florida DOT's asset management process is simply good quality management. It is mission driven and customer focused with clear links between decisions, budgeting, and performance monitoring.

Maryland

The Maryland DOT has a multimodal structure, and asset management is the first goal in the State Transportation Plan - "Efficiency: maximize the effectiveness of existing systems."16 The Maryland State Highway Administration (SHA) is the only administration within the DOT that has a formal, comprehensive, asset management program underway, although a multimodal, department-wide, asset management committee has been formed to develop guidelines and principles for asset management that cross the modes and to pursue asset management initiatives. The Maryland SHA's asset management program has historically focused on pavements and bridges, which represent the largest portion of the State's infrastructure assets. The emphasis now is on applying an asset management approach to managing assets other than pavements and bridges. The Highway Hydraulics Division, the Office of Traffic and Safety, and the Office of CHART (Coordinated Highways Action Response Team) and Intelligent Transportation Systems Development are beginning steps toward adopting asset management practices, and efforts are underway for the development of an agency-wide asset infrastructure data warehouse.

Supporting Maryland's Transportation Plan Goal 1 is the objective "Extend the useful life of existing facilities and equipment: The Department will place the highest priority on maximizing the useful life of existing assets and on keeping facilities in top condition to ensure service quality."17 Aligned with this objective, the SHA Pavement Division's goals for its asset management program are to determine a funding strategy; select specific projects to maximize highway network health within funding constraints; and predict future network health under a range of possible funding levels to inform policymakers of the effects of potential policy actions and funding levels.

The SHA's asset management approach to managing pavements has five steps: condition assessment, network-level planning, project selection, project advertisement, and construction. The SHA performs a condition assessment of its highway network (roughly 16,000 lane-miles) every year, rating ride quality as very good, good, fair, mediocre, or poor. The use of ARAN equipment across the State provides consistency.

Network-level planning - optimization - is done at the State level, within the Pavement Division, using a linear programming model to develop investment strategies that meet specific objectives. For a given objective (such as "maximize pavement condition under a specific funding constraint"), the model produces a list of how many lane-miles in each of the five conditions should be treated and with what type of treatment. It does not identify specific highway segments for treatment. The data necessary for this optimization process include pavement type, traffic level, road type, road class, district, last major treatment level, and condition for each pavement segment. Using these parameters, similar pavements are grouped. Treatment levels are also grouped by life expectancy: do nothing; maintenance (+4 years, +2 years); major (5, 8, 12, and 15 years). Using the pavement and treatment groupings, the models generate a variety of performance scenarios to predict future pavement performance, costs, and benefits across the network. The output identifies the percentage of each pavement group that should receive each level of treatment.

Project selection involves the SHA's Chief Engineer's office and each of the local districts through the Project Selection Tool (PST), software developed by the SHA. Using this tool, each district can access a roadway section inventory that shows roadway condition and traffic level as well as goals for the district: the number of lane-miles to treat within a budget constraint. Together, each district and the Pavement Division develop a list of potential projects. After cost estimates for the candidate projects are developed, the districts use the PST to compare the effectiveness of individual projects toward meeting the district's goals.

Each district's project selections are reviewed by the Chief Engineer's office to determine whether they will receive funding. The Pavement Division tries to design alternatives that meet a specified design life within defined costs. Project selection may be changed after advertising and project bidding take place and the costs in the PST are adjusted to reflect actual costs.

Maryland's Transportation Asset Management approach to pavements is notable for its linkage to strategic planning through a formal, annual, "Managing for Results" process as well as the use of formal performance measures; its high level of cooperation between central leadership and local districts; and its focus on long-term optimization. The Pavement Division is using asset management on a continual basis to meet the State's system preservation and customer satisfaction goals.

Michigan

The Michigan DOT has used an interagency committee to guide the implementation of asset management throughout the State. Michigan is one of the few States that have asset management mandated by law,18 a key factor enabling implementation progress. The Michigan DOT has a lot of enthusiasm and hope for the changes and improvements that asset management will bring. Public Act 499, which established the Transportation Asset Management Council (TAMC), explicitly terms asset management a "strategic" process, in which goals and objectives are set, life-cycle costs are analyzed, and investment strategies are recommended. The TAMC is mandated to propose a strategy to the State Transportation Commission.

The TAMC produces an annual budget, and interviews suggest that asset management has changed the way that projects are planned in terms of funding. In the past, when the State had money, it would be awarded to teams based on their responsiveness, not on the basis of overall system needs or priorities. Asset management has given the State the tools needed to budget responsibly, and also to negotiate political funding.

Michigan is actively pursuing asset management, and it is transforming the way Michigan's DOT operates by decentralizing operations and pushing planners into regional offices with the engineers. It is causing officials to rethink the way the State's trunkline highways are maintained and improved. It has provided a common language that allows disagreements to be discussed rationally and resolved, not just within the department, but also between the department and city and county governments.

The State's Transportation Management System database incorporates more than 100 performance measures. Three relate directly to management of highway infrastructure: bridge condition, pavement condition, and customer satisfaction. Each bridge is evaluated every 2 years through the bridge inspection process and the National Bridge Inventory; pavement condition is evaluated on the basis of ride smoothness, cracking, and rutting; and customer satisfaction surveys provide feedback on how well the Michigan DOT is addressing customer expectations.

As Michigan continues down this path, more changes will occur. The State is in the beginning phases of developing data collection and management systems that will allow it to fully utilize the power of asset management. While asset management is referenced in the Long-Range Plan, specific linkages are under development.

The passage of Public Act 499 has caused a sea change within the DOT. The culture is changing, and the old ways of "worst first" project prioritization are being replaced by thinking in terms of system optimization. As the data collection and management processes come on line and further linkages to the strategic plan are created, Michigan will continue to reap the substantial benefits of asset management.

Pennsylvania

The Pennsylvania DOT (PennDOT) has a strong strategic planning process as well as a well-defined asset management concept plan. The strategic planning process at PennDOT started in the 1970s; however, the asset management concept plan began in March 2001.19

The purpose of asset management is to implement the right strategy for the right asset at the right time. PennDOT's concept plan calls for every strategic objective to have an owner or a leader who is responsible for that specific objective. In many of these objectives, the leaders may be directly involved in implementing asset management in their division or in part of a specific management system.

Today, PennDOT is working toward an asset management program for Highway and Bridges. Historically, roadway, bridge, and maintenance functions have had separate management and reporting systems that are entrenched. Today, the department is data-rich, but to move the systems to the next level will require integration. PennDOT is incrementally bringing asset management to roads and bridges, where most of the dollars are spent. Some of the first steps that PennDOT has taken in moving toward asset management are replacing its old mainframe Bridge Management System (BMS) with its new Pontis-based BMS2 and replacing its old maintenance system with SAP/Plant Maintenance. In addition, PennDOT is a partner with AASHTO and other States in utilizing AASHTO's AssetManager NT and PT tools. Through these tools, PennDOT expects asset management to give the agency a good platform for tradeoff analysis. Although asset management is not yet defined at the strategic level and does not yet drive the agenda, it is still part of the plan.

Future management system enhancements and replacements are to be made in accordance with an overall information technology strategic plan. This plan has not yet been developed, although efforts have been made to define business needs and priorities.

Issues Raised by State Departments of Transportation

In workshops and seminars, State DOTs have raised a number of issues and challenges:

  • Technology can serve as an effective driver for advancing asset management in an agency.
  • Organizational culture may be one of the most significant obstacles to advancing asset management in an agency.
  • No one particular model can serve as the panacea in moving forward with asset management.
  • Agencies that are taking substantive steps to do good asset management differ in their use of the modified approach for GASB 34 reporting.
  • Agencies that have evaluated the Self-Assessment Tool20 developed by the National Cooperative Highway Research Program have found it helpful in identifying gaps in their approaches to asset management or have endorsed it as a useful starting place for agencies interested in beginning asset management.

States have also reported that the implementation of Transportation Asset Management programs has introduced a common language that improves communication in several ways:

  • Facilitates discussion and resolution of differences among different parts of the DOT.
  • Establishes a basis for rational debate among cities, counties, and the State.
  • Enables teamwork among disparate professions - planners, engineers, maintenance managers.

In addition, States have confirmed that asset management tools are an effective aid for negotiating political funding as well as for stabilizing the funding process over longer periods.

Many State DOTs have participated in the development and refinement of Transportation Asset Management practice through national committees and conferences. These include the Transportation Research Board's Asset Management Committee, AASHTO's Standing Committee on Maintenance, and collaborative efforts sponsored by FHWA with its partners, such as development of the Transportation Asset Management Guide.21 The States recognize that ongoing research is needed to develop and improve processes, implementation tools, and staff training programs in asset management. During the 6th National Conference on Transportation Asset Management,22 in 2005, a panel discussion focused on research needs and strategies for meeting them. Together with State DOTs, the views of academicians, university transportation centers, and systems consultants were represented. The panel identified the following research needs:

Data collection and integration

  • Maintaining databases of condition data (currency)
  • Metadata standards
  • Improving data quality
  • Automated data collection

Condition assessment

  • Condition assessment processes for hidden infrastructure
  • Using remote sensing capabilities
  • Better warning systems
  • Linking condition assessment with decisionmaking processes

Performance modeling

  • Capturing the effect of routine maintenance in life-value
  • Modeling preventative maintenance
  • Enhanced modeling techniques
  • Defining performance measures

Analysis

  • Tradeoffs in the decisionmaking process
  • Asset valuation methodologies
  • Risk analysis-cost of failure
  • Treatment selection methods

Big picture issues

  • Documenting the benefits of asset management
  • Infrastructure security
  • Applications of emerging technologies
  • Sustainable development

Teaching infrastructure management

  • Clearinghouse for infrastructure management course materials
  • Translating research into course materials

International Experience

International experiences with asset management are even more diverse than those in the United States because the institutional structures, funding sources, populations and areas served, and current state of the infrastructure assets vary considerably. A sampling of these experiences is documented in the 2005 report from the International Scanning Study team, which investigated advances and innovations in four countries at the national and state/provincial levels.23 To illustrate some of these international experiences, the following section describes some implementation approaches at the national level in Canada, Australia, New Zealand, and England, including collaboration between Australia and New Zealand.

Canada

Asset management systems are one of five strategic research and development initiatives named in the Transportation Association of Canada's (TAC's) Final Report: A National Agenda for Technological Research and Development in Road and Intermodal Transportation,24 which reports Canada's current progress and activities. The government's focus in the near future will be on rehabilitation and maintenance, since Canada's road system is well-developed and further expansion is unlikely for some time. Canada's assets represent billions of dollars in replacement value alone, and the ongoing costs to build, maintain, and operate the road network are considerable. Related to asset management, TAC's Final Report addresses trends, opportunities and needs, and research and development projects. Trends include the following (pp. 20-21):

  • Increasing public demand for accountability - efficient utilization of public resources.
  • Continuing shifting and re-balancing between funding of new facilities and preservation of existing facilities.
  • Increasing movement toward privatization of financing, operating, and maintaining highway infrastructure.
  • Emergence of "absentee" owners" (i.e., asset owners develop goals, plans, and budgets while actual maintenance and operation of highway infrastructure is done by agents acting on behalf of the owners).

Six specific areas of need for high-priority research and development in asset management were identified (pp. 21-24):

  • Objective measurement of asset condition and value - An agreed-upon asset condition measure (objective, verifiable, and time-stable assessment of asset condition and value) is not yet available in Canada. Canadian agencies use a variety of subjective condition assessment methods.
  • Tradeoffs between different programs or classes of assets - A technology is needed to determine the value users place on different programs and classes of assets and to translate these values into resource allocation decisions. Asset management should enable decisionmakers to readily evaluate tradeoffs among funding policies and should use a common yardstick for judging different programs.
  • Determination of desirable asset condition - To allocate funds to transportation infrastructure and its competing parts rationally, a methodology is needed to evaluate the public's willingness to pay for transportation services. Since market forces do not apply to public highway services, the equilibrium between level of service and willingness to pay is not known.
  • Response to industry demands for changes in vehicle weight and dimension regulations - A methodology is needed for assessing changes in heavy vehicle weight and dimension regulations on industry productivity and infrastructure impacts (benefits from increasing limits versus increased infrastructure costs), especially for evaluating new infrastructure-friendly truck suspension systems.
  • Advances in electronic data processing - A broad range of front-line staff should have access to data-based management tools and should be involved in the decision-making process. Technological applications such as the use of GPS to highway inventory, use of pattern recognition techniques, monitoring asset condition by video-recording, and advances in data processing and storage capabilities make highly integrated asset management systems possible.
  • Social and economic importance of highway infrastructure - The benefits of highway investments - economic growth, productivity gains, and employment opportunities - must be communicated effectively to the public to promote the understanding that highway infrastructure is an investment with a high rate of return that supports economic activities and increases productivity.

TAC reported that although the provinces have begun developing asset management systems, a system for assessment against a shared set of criteria is needed to set national investment priorities, and the ability to make that assessment has yet to be developed. To introduce asset management more widely at the federal, provincial, and municipal levels, TAC also has released Highway Asset Management Systems: A Primer.25

Australia and New Zealand

The principles of asset management and pavement management are widely recognized in Australia and New Zealand, and the use of integrated information and predictive and optimizing systems is increasing. The region's major road agencies began reporting the financial value of their road infrastructure assets in the late 1980s, and since 1997 all major road agencies have recognized road assets in annual financial statements. For more than a decade, the two countries have collaborated to advance their asset management programs.

A 1997 Austroads report, Strategy for Improving Asset Management Practice,26 lists 38 priority research and development actions for cooperative effort in Australia and New Zealand. Current activity includes developing standard guidelines for road condition measurement, refinement of models to predict road deterioration, accelerated testing, long-term monitoring to support the prediction of works effects, and correlation of road condition measures with community expectations, specifically for local roads carrying low volumes of high-mass vehicles. Work to improve understanding of the interaction between heavy vehicle loading and pavements is in the early stages. (Per capita, Australia is the world's most intensive user of road freight, and freight travel in Australia is predicted to double in the next 15 years.)

Many agencies have developed asset management man-uals, detailed processes, and analytical tools that support the day-to-day management and planning of road-related assets; however, a protocol is in place to support harmonized modeling of road user costs among road agencies across Australia. The protocol recognizes harmonization27 as dynamic in nature, and allows for continuous improvement on a coordinated basis. The concept of road hierarchies (fitness for purpose) is entrenched among the major road agencies, and is spreading among smaller road agencies.

The Austroads document Integrated Asset Management Guidelines for Road Networks 28 details a process for integrating all applicable asset management components - policy development, planning, plan execution, and verification - into a comprehensive planning framework. It defines Integrated Asset Management as "a process for ensuring the requirements of road agencies, road users and other stakeholders are clearly understood and integrated into an asset management framework that optimizes the outcomes achieved from policy and investment decisions" (p. 1).

In New Zealand, Transit NZ, the national highway agency, uses a National Asset Management Plan to guide planning related to transportation assets and decisions concerning resource allocation. This plan is instrumental in establishing the process and substance of asset management at the national level.

Performance measures and indicators are found at all levels of planning and decisionmaking. At the strategic management level, such measures and indicators are defined in the Statement of Intent, where targets are set at the start of each year and reconfirmed at midyear. An annual report shows progress on these indicators and presents information on the economic, environmental, and social goals that constitute the triple bottom line. It also includes a pavement condition report that includes measures relating to roughness, rutting, texture, and skid resistance. Operational performance measures cover issues such as availability of the network, level of congestion, safety, and response times. Financial information is also presented for program progress and delivery accountability. In addition, a monthly report presents progress reports against key performance measures in both absolute terms and trends.

Information on user satisfaction with the road network is also collected. The target established is 90 percent of road users rating their satisfaction with the road network as good or above. Road characteristics included in this survey are traffic flow, road safety, road surface, road marking, road signs, rest areas, and quality of the roadside environment.

Transit NZ is also incorporating asset management concepts into other activities and planning efforts. For example, it has developed a new agency environmental plan that is closely integrated with asset management.

England

England is a world leader in transportation, known for having one of the lowest road fatality rates of any country in the world as well as for applying innovative technologies and methods to the management of its infrastructure. The country's road network can be considered in two parts. The strategic or national network is managed by the Highways Agency, an executive agency in the United Kingdom's Department for Transport, and local authorities manage the nonstrategic, or local, network. One interesting aspect of the Highways Agency's road network is that, unlike in other countries, the mileage for which the Highway Agency is responsible has decreased each year over the past decade because the agency has been turning roads and bridges back to local governments (a practice referred to as "detrunking").

The impetus for asset management in England has been governmental directives on transport policy and accounting procedures, beginning in 1825, when Parliament stated that it was government's duty to maintain infrastructure built with public funds. The more recent evolution in asset management has come about in connection with governmental policies and procedures that have been established over the past 10 years.

Photo. Loading dock with freight containers, ship, and trucks.

The national government published a white paper in 1998 entitled A New Deal for Transport: Better for Everyone 29 and a report called A New Deal for Trunk Roads in England.30 Three major investment areas were identified in these reports - maintenance, operations, and capital improvement - along with investment criteria on safety, environment, economy, accessibility, and network integration. The reports also identified new directions for the Highways Agency, one of which was to "give priority to the maintenance of trunk roads and bridges with the broad objective of minimizing whole life costs." 31

A Local Government Act of 1999 defined governmental responsibility for stewardship of public funds by government agencies. Local governments and their agencies are deemed "best value authorities" with "best value" being their "general duty." A best-value authority must "make arrangements to secure continuous improvement in the way its functions are exercised, having regard to a combination of economy, efficiency and effectiveness."32 This act was preceded by a Compulsory Competitive Tendering policy, which required local authorities to follow certain processes when delivering services, thus leading to increased privatization of service delivery. This policy also changed the bid selection process from low bid to best value. The concept of "best value" has found its way into many technical guidelines and processes. For example, Well-maintained Highways, published by the Roads Liaison Group, is the U.K.'s "code of practice" for maintenance management. The code clearly places asset management at the center of guaranteeing best value in the road sector. In this document, the key principles of a Highway Asset Management Plan are defined as follows:33

  • Set of objectives and policies linked to business objectives.
  • An asset register (or inventory).
  • Levels of service.
  • Maintenance strategies for the long term based on sustainable use of physical resources and whole life costing.
  • Identification of future funding requirements to maintain required level of service.
  • Managing risk of failure or loss of use.
  • Development of coordinated forward programs for highway maintenance, operation, and improvement.
  • Measurement of performance and continuous improvement.

The Highways Agency has defined successful asset management as consisting of several steps: setting strategy and standards, recording the asset, identifying maintenance needs, prioritizing and managing maintenance needs, managing work programs and outcomes, influencing maintenance through design, measuring performance, and innovating and developing. At the top management level, the Highways Agency's Business Plan identifies the performance measures that reflect the different products and services to be delivered. Other more technical guidance on asset management is available for specific asset categories.

The U.K.'s Department of the Environment, Transport, and Regions has developed guidelines for the implementation of best practices in asset management, and the publication Modernizing Local Government Capital Finance Paper, Chapter 4 - Encouraging Best Practice in Asset Management 34 describes the government's efforts to see local government authorities make better use of their infrastructure assets.

Issues and Observations on the International Level

The 2005 International Scan of nearly a dozen sites in Australia and New Zealand, Canada, and the United Kingdom made some 31 observations on the asset management practices of the transportation agencies visited. Following is a sampling of those observations.

  • Most of the highway agencies had top-level agency commitment to asset management. Since top transportation leaders are usually in place for longer than is typical in the United States, once leaders are educated on the merits of asset management programs, agencies can rely on support for an extended period. All of the agencies had established a management position or office that was the focal point for guidance, information, and public participation related to asset management activities, as well as bringing together agency resources and capabilities for undertaking asset management and creating an asset management culture.
  • Legislation has been an important catalyst in bringing about current thinking and practice of asset management. Agencies stressed the importance of educating public officials and the general public.
  • Some of the technical approaches and use of data in the surveyed countries are similar to those in the United States:
    • All are using life-cycle (whole life) costing, supported by data identification and collection targeted for that purpose.
    • All are developing locational referencing systems for database support for asset management.
    • Some have adopted quality-control procedures, including periodic resampling, to assure high-quality data.
    • Data were highly accessible agency-wide.
    • All the agencies used risk assessment in some form in asset management applications, whether in asset management analysis, network development programs, or project prioritization, to a greater degree than is common in U.S. transportation agencies.
  • A key challenge has been changing organizational culture to support asset management programs.
  • To be effective, an asset management program must have a strong human resource element. Some positions have been established that name "asset management" in the job responsibilities; however, it has been difficult to find qualified candidates. Training, including the development of manuals and best-practice procedures, has been an important part of asset management implementation strategies. Professional associations and user groups related to asset management have also been useful recruitment and training tools.
  • Since private contracts deliver much of the maintenance and minor capital construction programs, contractor ownership of asset management in delivered programs is encouraged, and strong asset management principles are incorporated in public-private partnership agreements.
  • Most of the agencies must compete against other government programs for resources. Good data on infrastructure needs have provided justification for additional funding. A good asset management program also conveys to elected officials strong stewardship of transportation assets.
  • In general, the principles and processes of asset management have been incorporated into agency planning and policy documents and are linked to environmental policy and community quality of life efforts.
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Updated: 11/14/2012