Gas Tax Grant Program: British Columbia Links Infrastructure Funding to Implementation of "Watershed-Based Approach"
How Local Governments are Tackling the Unfunded Infrastructure Liability
Local governments in British Columbia and across Canada are faced with this financial challenge related to public worksl infrastructure:
The initial capital cost of infrastructure is about 20% of the life-cycle cost; the other 80% largely represents a future unfunded liability.
Each year, the funding shortfall grows. As infrastructure ages and fails, local governments cannot keep up with renewal and/or replacement. This fiscal reality creates the incentive to prevent additional financial impacts on taxpayer ability and willingness to pay additional taxes.
Sustainable Service Delivery
“Tackling the unfunded infrastructure liability has led to a life-cycle way of thinking about infrastructure needs, in particular how to pay for those needs over time. The Province’s branding for this holistic approach is Sustainable Service Delivery,” states Glen Brown, General Manager (Victoria Operations) with the Union of British Columbia Municipalities (UBCM).
Previously, Glen Brown was the Executive Director of the Province’s Local Government Infrastructure and Finance Division and the Deputy Inspector of Municipalities.
“Avoidance of a future financial liability is a driver for Sustainable Service Delivery. This fundamental shift in thinking starts with land use and watershed-based planning, to determine what services are affordable, both now and over time.”
“Sustainable Service Delivery builds on the principles of Asset Management which are probably a little too narrow at this time. When people involved in public works think of Asset Management, they typically think of pipes and roads, and how to maintain them.”
“Sustainable Service Delivery puts the lens of the environment over this so that we actually acknowledge environmental protection. That is a better definition of Asset Management, and that is what the Province and UBCM refer to as Sustainable Service Delivery,” emphasizes Glen Brown.
Provincial Requirement for Asset Management
“Asset Management is a component, and a requirement, under the new Gas Tax Grant Program. And we certainly would like Asset Management to be thought of with the lens of environment and ecology,” continues Glen Brown.
“So, this will be a major driver with decision-makers because it is the dollars that determine how and what decisions are made. And when you connect the dots, you wind up with a greener community, water protection, water conservation, adapting to a changing climate. All these aspects can be part of the Sustainable Service Delivery piece.”
Perspective on Sequential Implementation
“For those local governments that are just beginning the journey with respect to the development and implementation of asset management, Sustainable Service Delivery may be considered an ‘advanced’ way of thinking,” states Glen Brown.
“But it would only be considered ‘advanced’ in the context of implementing ultimate financial accountability. First, embrace Asset Management. Then evolve to Sustainable Service Delivery. This means that local governments would have to have a fairly good understanding of Asset Management principles and their application before going to the next level of practice which is Sustainable Service Delivery.”
“That being said, and no matter what level of Asset Management development or implementation a local government is at, the key message is that including nature, natural resource management and natural services into their thinking should be done at the beginning – and the beginning has everything to do with planning.”
Integration of Land Use and Asset Management Planning, a paper by Kim Fowler
“Land use planning in British Columbia may be significantly improved when integrated with asset management planning in local governments,” wrote Kim Fowler, a former Director of Sustainability for the City of Victoria in her 2010 paper titled “Local Government Land Use and Asset Management Planning in BC: Proposed Sustainable Service Improvements”.
“If the necessity, goal, and best practice of asset management is an integrated approach involving planning, finance, engineering and operations…..why are planners the least knowledgeable of the local government professionals about asset management when land use planning is the key determinant for infrastructure demand and servicing?”
“The legislative authority for integration of land use planning and asset management, including financial management, already exists within the Local Government Act and Community Charter.”
To Learn More:
To download a copy of the paper written by Kim Fowler, click on Local Government Land Use and Asset Management Planning in BC: Proposed Sustainable Service Improvements