Balancing investment choices between infrastructure renewal and growth presents a significant challenge, especially when our city grows and ages at the same time. The gap between what is needed and what the City can afford continues to grow; therefore, obtaining and prioritizing funding remains a key concern.
The City's infrastructure is aging. The 10-year Capital Investment Agenda (2012-21) reports that the average age of the City's infrastructure assets is 30 years, and the average expected life of all City assets is 50 years. This presents several challenges:
- Aging Neighbourhoods – mature neighbourhoods are aging and will require significant reinvestment. A Neighbourhood Renewal Program has been implemented to balance the need to rebuild in some neighbourhoods with a preventive maintenance approach in others.
- Aging Infrastructure – increasing maintenance and rehabilitation is needed to ensure that aging infrastructure is performing well and continuing to meet the needs of citizens. Tough decisions have to be made to ensure that investment is targeted to where it is needed most. Edmonton's Risk-based Infrastructure Management System (RIMS) is used to assist in ranking the rehabilitation needs of the City's assets, and to optimize the allocation of renewal funds across the varied infrastructure to ensure long-term value.
Edmonton is experiencing continued growth, which places a strain on the city’s existing infrastructure and increases the demand for new infrastructure to meet citizen's needs. The primary challenges for growth are:
- Limited growth money – once funding for previously committed projects, allocation to renewal needs and constrained funding (funding that must be used for a specific purpose and cannot be reallocated) is considered, there is limited funding available to meet identified growth needs and continue to work toward achieving a reasonable state of repair of existing assets, without additional funding sources.
- Operating costs associated with new infrastructure can be as much as, or more than the initial capital investment over the life of the asset. Operating costs are ongoing and need to be considered as part of the decision to fund a growth project. The City's Integrated Infrastructure Management Planning Framework helps decision-makers determine how growth can be achieved in the most effective and sustainable way, taking future operating costs (among other factors) into consideration.
- Rising costs – more stringent environmental regulations demand larger investments to meet building codes and comply with regulations. Edmonton’s strong economy is also increasing construction costs.
Risk-based Infrastructure Management System
The City uses RIMS to predict the optimal funding for the renewal of existing infrastructure. The model uses an asset’s current physical condition, its target physical condition, renewal investment options/costs, and expected lifecycle deterioration curve to model the effect of different investment options and their timing throughout the life of the asset.
Ideally, the physical condition of any asset will fall within an acceptable tolerance range or standard. This tolerance—or conversely, the physical condition beyond which the deterioration is unacceptable—differs for every asset. The City’s assets are there to provide a service such as recreation, transportation and protection. The physical standard is dependent on the type of service the asset is providing, the risk it exposes the City to if it fails, and the best combination of investment and performance to maximize the life of the asset at a minimized cost. In other words, when deciding what to renew the City considers a combination of the condition of an asset and how important it is.