More reinvestment in municipal buildings urged

Thursday, January 21, 2016

Canadian municipalities collectively own a large and varied portfolio of public buildings with an estimated replacement cost of more than $120 billion, according to the newly released 2016 Canadian Infrastructure Report Card. Buildings related to delivery of core municipal services account for the major share of this tally, while sports and recreation facilities are pegged at an estimated $51-billion value.

In analyzing submissions from 200 municipalities and 37 transit authorities, the survey sponsors conclude that one third of Canadian municipal infrastructure is at risk of rapid deterioration. Soundness ratings vary somewhat among the eight asset categories examined, but seven of the eight are deemed to be in declining condition based on the reported level of reinvestment in upkeep.

“What this survey shows is that we need to repair our existing infrastructure. Our infrastructure is aging and we need to accelerate the rate of renewal,” asserts Kealy Dedman, president of the Canadian Public Works Association — one of the sponsoring organizations of the report card along with the Canadian Construction Association, the Canadian Society for Civil Engineering and the Federation of Canadian Municipalities.

A higher percentage of public buildings are deemed to be in fair, poor or very poor condition than is found in the six other asset categories surveyed. Sports and recreation facilities posted the worst numbers of all categories, with 54 per cent of assets considered in very good or good condition. Other municipally owned buildings — administrative buildings, childcare/daycare centres, community centres, healthcare and long-term care facilities, shelters, libraries, police, fire and paramedic stations — had a slightly larger 55 per cent complement identified in good or very good condition.

Yet, buildings may be a lesser concern for municipal asset managers given their far more valuable holdings of other categories of critical infrastructure. Nationally, this represents an estimated $207 billion in water treatment pipes and facilities, $234 billion in wastewater systems and $330 billion in roads, meaning that far greater capital investment is required to address deferred maintenance and upgrades for these key services.

Perhaps because of their lower overall value, municipal buildings are the one asset category where reinvestment in upkeep and renewal is within the generally recommended range of  1.7 to 2.5 per cent of value annually — albeit at the low end, just hitting 1.7 per cent. Annual reinvestment in sport and recreation facilities falls short of this target at 1.3 per cent of value.

More than half of the reported municipal buildings were more than 31 years old, including 23 per cent that were more than 50 years old. Health care facilities, shelters and community centres tended to be older, while half of the reported paramedic and police stations were built within the last 20 years.

A large majority of surveyed municipalities have some form of asset management program in place, but 10 per cent had no data on building condition. Fourteen per cent now factor climate change adaptation strategies into decision making about their building portfolio.

This is the second infrastructure report card, four years after the first municipal survey. Its release comes as the newly elected Canadian government develops a promised economic stimulus program based on infrastructure spending.

“In the end, it is not a question of investing or not investing; it’s a question of cost and good infrastructure management,” says Raymond Louie, president of the Federation of Canadian Municipalities. “The bottom line is that the longer we wait to act on these repairs, the more expensive it will get. Canada needs to start planning for the future by reinvesting in our existing assets now.”

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