Asset management (AM) is a business approach that involves bringing together planning, finance, engineering, and operations to effectively manage existing and new infrastructure. AM helps to maximize benefit, reduce or transfer risk, and provide appropriate levels of service to the community in a socially, environmentally, and economically sustainable manner.
- Understanding the assets managed by a municipality: what assets a municipality owns and what condition are they in through the development of an asset inventory.
- Understanding the life cycle costs of what a municipality owns: what costs a municipality anticipates to occur during the ownership of the assets – such as costs of operating, maintenance, major repair or renewal, disposal.
- Understanding the level of service currently provided and future requirement: what is expected, what it costs and what are ratepayers willing to pay for, what are risks associated with not providing.
- Understanding the cost and timing of future expenditures: which may include the need to prioritize assets that need to be fixed or replaced first or if a different asset should be obtained to better meet the need.
- Understanding the availability of funding for all life cycle costs: what is affordable and sustainable, what are the funding sources.
- Plan coordination: Incorporating asset management into other corporate plans.
- Informing the public: Reporting publicly the status and performance of implementing asset management policies.