Callander recently had an asset management plan drawn up to help keep them on track as they save for future maintenance and repairs. The report, put together by PSD City Wide Inc., a public sector consulting firm based in London, Ontario, provided a detailed view of the municipality’s infrastructure assets.
The company has been “working with the municipality for over a year,” explained Mai Abdou, an asset management consultant with PSD City Wide, with the result being “a quality document we can rely on.”
And it won’t be the last. This is the first of three asset management reports coming in. This document focused mainly on the core assets—roads, bridges, water, wastewater, and storm system—and the next study, coming in 2024, will focus on “all of your assets.”
The final report, due in 2025, will outline “the level of service” the municipality dedicates itself to maintaining, which will factor into to how these assets are cared for long term. For example, if snow plowing is estimated to decrease by five per cent, that machine will presumably last longer, and council can save accordingly.
In total, the municipality has $87.8 million in assets—that’s the estimated cost to replace everything—and to put that into perspective, which Abdou did, that amounts to $49,000 per household.
It’s a large number, and one council must keep in mind as they budget their savings to cover maintenance costs. The good news is that these assets are in good condition. On a scale ranging from very poor to very good, “about 68 per cent of your core assets are in fair condition or better,” Abdou said, “and 84 per cent of your non-core asserts are fair or better.”
“Your core assets are doing quite well; they are overall in a good condition on par with a lot of Ontario municipalities,” she said. “A lot are struggling with their assets,” she explained, providing statistics on culverts as an example. Callander has about 8 per cent of its culverts listed as very poor and the Canadian average is about 12 per cent she said.
Abdou’s report urged council to add more to reserves, as her company estimates “the municipality’s average annual capital requirement totals $2.3 million,” and the current annual contribution is “$1.8 million towards capital projects of reserves per year.”
“As a result, there is currently an annual funding gap of $542,000,” to cover annually, “which translates to approximately $300 per household,” the report explains.
In a worst-case scenario, neglecting to make up this difference could lead to tax increases. PSD City Wide’s report suggested increasing the rate-funded water levy 4.8 per cent per year every year for 20 years would cover it, but council was quick to wash that possibility off the table, opting to increase reserve funding over those years instead.
“Our municipality is in really great shape,” Mayor Robb Noon said, “we’ve been saving for years, our council is really proactive in that.”
The report is “a great start” he said, “you can use that to help plan initiatives accordingly so that everything works out,” and you “don’t have to tax the taxpayers so much to do these big catchups.”
Reports like these give the municipality a snapshot of how they have been doing, and now they know they need to save more “to keep that level tax rate.” As for the possible 4.8 percent annual increase to the water levy, “we do not have to do that, we’re in good shape,” Noon said.
“Now we have to decide how much money we add to those reserves to ensure we can achieve those goals.”
David Briggs is a Local Journalism Initiative reporter who works out of BayToday, a publication of Village Media. The Local Journalism Initiative is funded by the Government of Canada.
