City of Stirling Buildings Asset Managment Plan 2018 - 2028

10-year financial planning period This asset management plan identifies the projected operations, maintenance and capital renewal expenditures required to provide an agreed level of service to the community over a 10-year period. This provides input into 10-year financial and funding plans aimed at providing the required services in a sustainable manner. These projected expenditures may be compared to budgeted expenditures in the 10-year period to identify any funding shortfall. In a core asset management plan, a gap is generally due to increasing asset renewals for ageing assets. The projected operations, maintenance and capital renewal/ replacement expenditure required over the 10-year planning period is $14.07 million on average per year. Estimated (budget) operations, maintenance and capital renewal/ replacement funding is $13.79 million on average per year, giving a 10- year funding shortfall of $0.27 million per year for renewal/replacement

7.1.1 Sustainability of service delivery

expenditure. Allocated budget in the Long-Term Financial Plan is short for building renewal/replacement and over allocated for new capital when compared to the BAMP. Future revisions of the BAMP will report more accurate budget estimates and show improved alignment with the long term financial plan. Providing services from infrastructure in a sustainable manner requires the matching and managing of service levels, risks, projected expenditures and financing to achieve a financial indicator of approximately 1.0 for the first years of the asset management plan and ideally over the 10-year life of the Long-Term Financial Plan. Table 7.1.1 below shows the projected renewal and replacement expenditure in this asset management plan and the financing gap in the Long-Term Financial Plan in today’s values. Budget expenditures accommodated in the Long-Term Financial Plan are extrapolated from current budgets. The projected 20-year buildings expenditure is shown in Appendix D.

There are four key indicators for service delivery sustainability that have been considered in the analysis of the services provided by this asset category, these being the asset renewal funding ratio, long-term lifecycle costs/expenditures and medium-term projected/budgeted expenditures over five and 10 years of the planning period.

Asset renewal funding ratio Asset renewal funding ratio 13 96 per cent

The asset renewal funding ratio is the most important indicator. It reveals that over the next 10 years of forecasting, the City will have 96 per cent of the funds required for the optimal renewal of assets. This ratio is within the State’s current financial sustainability target of 90 per cent to 110 per cent.

LTFP renewal budget (thousands)

Projected renewals/ replacement (thousands)

Financing shortfall (thousands) (-ve gap, +ve surplus)

Cumulative shortfall (thousands) (-ve gap, +ve surplus)

Year

2018/19

$6,369

$4,196

-$2,173

-$2,173

2019/20

$6,570

$6,925

$355

-$1,817

2020/21

$6,315

$8,481

$2,166

$349

2021/22

$6,315

$6,247

-$68

$281

2022/23

$6,315

$4,518

-$1,797

-$1,515

2023/24

$6,315

$5,562

-$753

-$2,268

2024/25

$6,315

$5,262

-$1,053

-$3,321

2025/26

$6,315

$5,394

-$921

-$4,242

2026/27

$6,315

$6,911

$596

-$3,645

2027/28

$6,315

$7,202

$887

-$2,758

Table 7.1.1 Projected and LTFP budgeted renewals and financing shortfall

management plan (including possibly revising the LTFP) before adopting the asset management plan to manage required service levels and funding to eliminate any funding gap.

A gap between projected asset renewal/replacement expenditure and amounts accommodated in the LTFP indicates that further work is required on reviewing service levels in the asset

13 AIFMM, 2015, Version 1.0, Financial Sustainability Indicator 3, Sec 2.6, p 9.

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