NOTICE

The Federal Highway Administration provides

high-quality information to serve Government,

industry, and the public in a manner that promotes public understanding. Standards and

policies are used to ensure and maximize the

quality, objectivity, utility, and integrity of its

information. FHWA periodically reviews quality

issues and adjusts its programs and processes to ensure continuous quality improvement.
1. Report No.

FHWA-PL-05-019

2. Government Accession No. 3. Recipient’s Catalog No.

Technical Report Documentation Page

4. Title and Subtitle Transportation Asset Management In Australia, Canada, 

England, and New Zealand

7. Author(s) David Geiger, Paul Wells, Patricia Bugas-Schramm, Lacy

Love, Dr. Sue McNeil, Dennis Merida, Dr. Michael Meyer, Robert

Ritter, Kirk Steudle, Donald Tuggle, Larry Velasquez

9. Performing Organization Name and Address

American Trade Initiatives

P.O. Box 8228

Alexandria, VA 22306-8228

12. Sponsoring Agency Name and Address

Office of International Programs

Office of Policy

Federal Highway Administration

U.S. Department of Transportation

American Association of State Highway and Transportation Officials

5. Report Date

November 2005

6. Performing Organization Code

8. Performing Organization Report No.

10. Work Unit No. (TRAIS)

11. Contract or Grant No.

DTFH61-99-C-005

13. Type of Report and Period Covered

14. Sponsoring Agency Code

15. Supplementary Notes

FHWA COTR: Hana Maier, Office of International Programs

16. Abstract

A significant challenge for U.S. transportation agencies is managing the transportation asset base while

funding expansions of the network to meet increasing demands. The Federal Highway Administration,

American Association of State Highway and Transportation Officials, and National Cooperative Highway

Research Program sponsored a scanning study of asset management experience, techniques, and processes

in Australia, Canada, England, and New Zealand.

In its study, the U.S. team observed that asset management as an organizational culture and decisionmaking

process is critical to transportation programs facing significant capital renewal and preservation needs 

and that successful programs require top-level commitment. The team also learned that agencies in the

countries studied used asset management practices to obtain funding for transportation infrastructure.

The team’s recommendations for possible implementation in the United States include using asset 

management principles to assess and invest in the Interstate System, creating a National Asset 

Management Steering Committee to distribute information and provide training, developing a 

Web-based asset-management toolbox, and conducting research on asset management topics.

17. Key Words

asset management, gap analysis, infrastructure, 

performance measures, public-private partnership,

risk 

18. Distribution Statement

No restrictions. This document is available to the

public from the: Office of International Programs,

FHWA-HPIP, Room 3325, U.S. Department of

Transportation, Washington, DC 20590

international@fhwa.dot.gov

www.international.fhwa.dot.gov

19. Security Classify. (of this report)

Unclassified

20. Security Classify. (of this page)

Unclassified

21. No. of Pages

160

22. Price

Free

Form DOT F 1700.7 (8-72) Reproduction of completed page authorized
Prepared by the International

Scanning Study Team:

David R. Geiger (Co-Chair)

FHWA

Paul T. Wells (Co-Chair)

New York State DOT

Patricia Bugas-Schramm

Portland Transportation 

Maintenance Bureau

Lacy D. Love

North Carolina DOT

Dr. Sue McNeil

University of Illinois at Chicago

Dennis L. Merida

FHWA

Dr. Michael Meyer

(Report Facilitator)

Georgia Institute of Technology

Robert Ritter

FHWA

Kirk T. Steudle

Michigan DOT

Donald R. Tuggle

FHWA

Larry Velasquez

New Mexico DOT

and

American Trade Initiatives, Inc.

for the

Federal Highway Administration

U.S. Department of Transportation

American Association of 

State Highway and

Transportation Officials

National Cooperative Highway

Research Program 

November 2005

Transportation Asset Management In Australia, Canada, England, and New Zealand
The Federal Highway Administration’s

(FHWA) Technology Exchange Program accesses and 

evaluates innovative foreign technologies and practices 

that could significantly benefit U.S. highway transportation 

systems. This approach allows for advanced technology 

to be adapted and put into practice much more efficiently

without spending scarce research funds to recreate 

advances already developed by other countries.

The main channel for accessing foreign innovations 

is the International Technology Scanning Program. The 

program is undertaken jointly with the American Association

of State Highway and Transportation Officials (AASHTO)

and its Special Committee on International Activity

Coordination in cooperation with the Transportation

Research Board’s National Cooperative Highway Research

Program Project 20-36 on “Highway Research and

Technology—International Information Sharing,” the 

private sector, and academia. 

FHWA and AASHTO jointly determine priority topics for

teams of U.S. experts to study. Teams in the specific areas

being investigated are formed and sent to countries where 

significant advances and innovations have been made in 

technology, management practices, organizational structure,

program delivery, and financing. Scanning teams usually

include representatives from FHWA, State departments of

transportation, local governments, transportation trade and

research groups, the private sector, and academia. 

After a scan is completed, team members evaluate 

FHWA International

Technology Exchange

Program

findings and develop comprehensive reports, including 

recommendations for further research and pilot projects 

to verify the value of adapting innovations for U.S. use. Scan

reports, as well as the results of pilot programs and research,

are circulated throughout the country to State and local

transportation officials and the private sector. Since 1990,

FHWA has organized more than 60 international scans and

disseminated findings nationwide on topics such as pavements, bridge construction and maintenance, contracting,

intermodal transport, organizational management, winter road

maintenance, safety, intelligent transportation systems, 

planning, and policy. 

The International Technology Scanning Program has 

resulted in significant improvements and savings in road 

program technologies and practices throughout the United

States. In some cases, scan studies have facilitated joint

research and technology-sharing projects with international

counterparts, further conserving resources and advancing the

state of the art. Scan studies have also exposed transportation

professionals to remarkable advancements and inspired

implementation of hundreds of innovations. The result: large

savings of research dollars and time, as well as significant

improvements in the Nation’s transportation system.

For a complete list of International Technology 

Scanning Program topics and to order free copies of the

reports, please see the list contained in this publication 

and at www.international.fhwa.dot.gov, or e-mail

international@fhwa.dot.gov.

iv |
TRANSPORTATION ASSET MANAGEMENT | v

SAFETY

Roadway Human Factors and Behavioral Safety in Europe

(2005)

Traffic Safety Information Systems in Europe and Australia

(2004)

Signalized Intersection Safety in Europe (2003)

Managing and Organizing Comprehensive Highway Safety in

Europe (2003)

European Road Lighting Technologies (2001)

Commercial Vehicle Safety, Technology, and Practice in Europe

(2000)

Methods and Procedures to Reduce Motorist Delays in

European Work Zones (2000)

Innovative Traffic Control Technology and Practice in Europe

(1999)

Road Safety Audits—Final Report and Case Studies (1997)

Speed Management and Enforcement Technology: Europe and

Australia (1996)

Safety Management Practices in Japan, Australia, and New

Zealand (1995)

Pedestrian and Bicycle Safety in England, Germany, and the

Netherlands (1994)

PLANNING AND ENVIRONMENT

Transportation Asset Management in Australia, Canada,

England, and New Zealand (2005)

Transportation Performance Measures in Australia, Canada,

Japan, and New Zealand (2004)

European Right-of-Way and Utilities Best Practices (2002)

Geometric Design Practices for European Roads (2002) 

Wildlife Habitat Connectivity Across European Highways (2002)

Sustainable Transportation Practices in Europe (2001) 

Recycled Materials In European Highway Environments (1999)

European Intermodal Programs: Planning, Policy, and

Technology (1999)

National Travel Surveys (1994)

POLICY AND INFORMATION

European Practices in Transportation Workforce Development

(2003) 

Intelligent Transportation Systems and Winter Operations in

Japan (2003)

Emerging Models for Delivering

Transportation Programs and Services

(1999)

National Travel Surveys (1994)

Acquiring Highway Transportation

Information from Abroad (1994)

International Guide to Highway

Transportation Information (1994)

International Contract Administration

Techniques for Quality Enhancement

(1994)

European Intermodal Programs:

Planning, Policy, and Technology (1994)

OPERATIONS

Superior Materials, Advanced Test Methods, and Specifications

in Europe (2004)

Freight Transportation: The Latin American Market (2003)

Meeting 21st Century Challenges of System Performance

Through Better Operations (2003) 

Traveler Information Systems in Europe (2003)

Freight Transportation: The European Market (2002)

INTERNATIONAL

TECHNOLOGY

SCANNING PROGRAM:

BRINGING GLOBAL

INNOVATIONS TO 

U.S. HIGHWAYS

FHWA International

Technology Exchange

Reports
European Road Lighting Technologies (2001)

Methods and Procedures to Reduce Motorist Delays in

European Work Zones (2000)

Innovative Traffic Control Technology and Practice in Europe

(1999)

European Winter Service Technology (1998)

Traffic Management and Traveler Information Systems (1997)

European Traffic Monitoring (1997)

Highway/Commercial Vehicle

Interaction (1996)

Winter Maintenance Technology and

Practices—Learning from Abroad 

(1995)

Advanced Transportation Technology

(1994)

Snowbreak Forest Book—Highway

Snowstorm Countermeasure Manual

(1990)

INFRASTRUCTURE—General

Construction Management Practices in Canada and Europe

(2005)

European Practices in Transportation Workforce Development

(2003) 

Contract Administration: Technology and Practice in Europe

(2002)

European Road Lighting Technologies (2001)

Geometric Design Practices for European Roads (2001)

Geotechnical Engineering Practices in Canada and Europe

(1999) 

Geotechnology—Soil Nailing (1993)

INFRASTRUCTURE—Pavements

Quiet Pavements Systems in Europe (2005)

Pavement Preservation Technology in France, South Africa, and

Australia (2003)

Recycled Materials In European Highway Environments (1999)

South African Pavement and Other Highway Technologies and

Practices (1997)

Highway/Commercial Vehicle Interaction (1996)

European Concrete Highways (1992)

European Asphalt Technology (1990)

INFRASTRUCTURE—Bridges

Prefabricated Bridge Elements and Systems in Japan and

Europe (2005)

Bridge Preservation and Maintenance in Europe and South

Africa (2005)

Performance of Concrete Segmental and Cable-Stayed 

Bridges in Europe (2001)

Steel Bridge Fabrication Technologies in Europe and Japan

(2001)

European Practices for Bridge Scour and Stream Instability

Countermeasures (1999)

Advanced Composites in Bridges in Europe and Japan (1997)

Asian Bridge Structures (1997)

Bridge Maintenance Coatings (1997)

Northumberland Strait Crossing Project (1996) 

European Bridge Structures (1995)

vi |

ALL PUBLICATIONS

ARE AVAILABLE ON

THE INTERNET AT

www.international.

fhwa.dot.gov
TRANSPORTATION ASSET MANAGEMENT | vii

Table of

Contents

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . .xi

Scan Team . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .xi

General Observations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .xi

Lessons for the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . .xiii

Implementation Strategies, Dissemination, 

and Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .xiii

Chapter 1: Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Scan Team . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Scan Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Report Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

Chapter 2: National Experience 

with Asset Management . . . . . . . . . . . . . . . . . . . . . . . . . . .3

England . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

New Zealand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17

Chapter 3: State/Provincial Experience

with Asset Management . . . . . . . . . . . . . . . . . . . . . . . . . .31

Alberta, Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31

New South Wales, Australia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37

Queensland, Australia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45

Victoria, Australia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .58

Chapter 4: Local Experience

with Asset Management . . . . . . . . . . . . . . . . . . . . . . . . . .75

Brisbane, Queensland, Australia . . . . . . . . . . . . . . . . . . . . . . . . . .75

Edmonton, Alberta, Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .83

London, England . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .89

Chapter 5: Associations and Support Groups

for Asset Management . . . . . . . . . . . . . . . . . . . . . . . . . . .95

Austroads . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .95

National Asset Management Steering Group . . . . . . . . . . . . . .95

County Surveyors’ Society . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .96

Chapter 6: General Observations . . . . . . . . . . . . . . . . . .99

Leadership and Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . .99

Asset Management’s Role in Decisionmaking . . . . . . . . . . . . .99

Technical Approaches and Data Use in Asset Management100

Program Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .101

Human Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .102

Chapter 7: Lessons for the United States . . . . . . . . . .103

Chapter 8: Implementation Strategies . . . . . . . . . . . . .105

Short-Term Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105

Long-Term Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105

Appendix A: Scan Team Members . . . . . . . . . . . . . . . .107

Appendix B: Amplifying Questions . . . . . . . . . . . . . . .111

Appendix C: Asset Management Job Descriptions,

Transit New Zealand . . . . . . . . . . . . . . . . . . . . . . . . . . .115

Appendix D: Network Management Area Plan, 

Transit New Zealand . . . . . . . . . . . . . . . . . . . . . . . . . . .123

Appendix E: Asset Management Strategy Template, 

New South Wales Treasury . . . . . . . . . . . . . . . . . . . . . .137

FIGURES

Figure 1. Asset management practice in England’s Highways

Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Figure 2. Highways Agency Pavement Management System

(HAPMS). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

Figure 3. Desired structure of a future asset management 

system for the Highways Agency. . . . . . . . . . . . . . . . . . . . . . . . . .11

Figure 4. Similar to other countries, England has significant

challenges maintaining the condition of historic bridges. . . . .13

Figure 5. Calculation of risk of failure for structures in 

England. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15

Figure 6. Bridge condition distribution, Network Rail, 

England. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

Figure 7. Organizational structure for transportation in New

Zealand. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

Figure 8. Transit New Zealand’s asset management 

process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

Figure 9. Business model of asset management in New

Zealand. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21

Figure 10. Use of performance measures in Transit New

Zealand. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

Figure 11. Network rutting reporting in New Zealand. . . . . . . .22

Figure 12. Current and future systems configuration at Transit

New Zealand. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27

Figure 13. Core work processes in TIMS in Alberta. . . . . . . . .34
Figure 14. Buildup of candidate improvement road sections 

in Alberta. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34

Figure 15. BEADS components in Alberta. . . . . . . . . . . . . . . . . .35

Figure 16. Alignment among Corporate Plan, Results/Services

Plan, and Asset Strategy at the Roads and Traffic 

Authority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40

Figure 17. Decisionmaking structure for asset management 

in New South Wales. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41

Figure 18. Examples of Roads and Traffic Authority 

performance measures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42

Figure 19. Results from the New South Wales integrated asset

management system. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43

Figure 20. Similar to other Australian states, Queensland has

numerous timber bridges that present important challenges to

its asset management program. . . . . . . . . . . . . . . . . . . . . . . . . . .48

Figure 21. Road asset maintenance in the context of road 

system management in Queensland. . . . . . . . . . . . . . . . . . . . . . .49

Figure 22. Strategic framework for road system management 

in Queensland. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50

Figure 23. Performance management at Main Roads in

Queensland. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51

Figure 24. Road asset management system in Queensland. . .52

Figure 25. Bridge asset management system framework in

Queensland. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .54

Figure 26. Condition of timber bridges in Queensland. . . . . . .55

Figure 27. A Road Management Information System in

Queensland. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .55

Figure 28. Bridge prioritization program in Queensland. . . . . .56

Figure 29. Illustrative results from a Main Roads SCENARIO

analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56

Figure 30. Future asset management system at Main 

Roads. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .58

Figure 31. An integrated perspective of asset management in

Victoria. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .60

Figure 32. Many Australian cities are building major new 

highways by tunneling under the city, making tunnels an

important component of agency and private concessionaire

asset management programs. . . . . . . . . . . . . . . . . . . . . . . . . . . . .61

Figure 33. Road Infrastructure Management System at

VicRoads. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .62

Figure 34. Roadside management framework at VicRoads . . .63

Figure 35. Arterial bridge management and asset management

at VicRoads. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .64

Figure 36. Information reporting hierarchy at VicRoads. . . . . .65

Figure 37. Performance indicator reporting at VicRoads. . . . . .65

Figure 38. Targeted road information management system at

VicRoads. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67

Figure 39. Scan team member Lacy Love (left) discusses use of

the SCRIM machine to collect pavement data with a machine

operator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67

Figure 40. Asset management approach for toll roads in

Melbourne. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71

Figure 41. Asset management tools for toll roads in 

Melbourne. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72

Figure 42. Asset management model in Brisbane. . . . . . . . . . .77

Figure 43. Rutting and roughness data for Brisbane. . . . . . . . .78

Figure 44. Asset management systems in Brisbane. . . . . . . . . .79

Figure 45. Scenario analysis in Brisbane. . . . . . . . . . . . . . . . . . .80

Figure 46. Brisbane has devoted considerable resources to an

asset management program for its sidewalks. . . . . . . . . . . . . .81

Figure 47. Portrayal of the extent of the infrastructure challenge

in Brisbane. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82

Figure 48. Asset management organization in Edmonton . . . .84

Figure 49. Rating Edmonton’s roads by condition, functionality,

and demand. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .87

Figure 50. Scenario analysis in Edmonton showing different

condition time streams. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88

Figure 51. Example of risk assessment in Edmonton. . . . . . . . .88

Figure 52. Streetlight inventory and condition assessment in

London. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91

Figure 53. Asset Inventory and Management System in 

London. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .92

Figure 54. Percentage of local governments using asset 

management systems in England. . . . . . . . . . . . . . . . . . . . . . . . .92

Figure 55. Asset management framework recommended by the

County Surveyors’ Society in England. . . . . . . . . . . . . . . . . . . . . .97

TABLES

Table 1. Business uses of pavement asset data in England’s

Highway Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Table 2. Values for calculating likelihood of risk events. . . . . .13

Table 3. Value management scoring framework for 

maintenance projects in England. . . . . . . . . . . . . . . . . . . . . . . . .16

Table 4. Examples of performance measures used by Transit

New Zealand. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

Table 5. Calculation of replacement cost. . . . . . . . . . . . . . . . . . .28

Table 6. Comparative bridge risk scores Across Main Roads’

regions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56

Table 7. VicRoads’ data-collection strategy for network 

condition and performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .68

viii | TABLE OF CONTENTS
TRANSPORTATION ASSET MANAGEMENT | ix

AADT Annual Average Daily Traffic

AASHTO American Association of State Highway and 

Transportation Officials

AIMS Asset Inventory and Management System

AIT Alberta Infrastructure and Transportation

AMP Asset Management Plan

APWA American Public Works Association

ARMIS A Road Management Information System

ASCE American Society of Civil Engineers

BAMS Bridge Asset Management System

BCR Benefit-Cost Ratio

BDI Bridge Inventory

BEADS Bridge Expert Analysis and Decision Support

BIS Bridge Information System

BMS Bridge Management System

BSI Bridge Structural Index

BVPI Best-Value Performance Indicator

CIC Capital Investment Committee

CCT Compulsive Competitive Tendering

CMMS Computerized Maintenance Management 

System

CPI Capital Planning Initiative

CVI Coarse Visual Inspection

dTIMS Deighton Total Infrastructure Management 

System

DVI Detailed Visual Inspection

EPA Environmental Protection Agency

ESA Equivalent Single Axle

FHWA Federal Highway Administration

GIS Geographic Information Systems

GPS Global Positioning Systems

HAPMS Highways Agency Pavement Management 

System

HDM Highway Development and Management 

System

HMMP Highway Maintenance Management Plan

HPMA Highway Pavement Management 

Application

IRI International Roughness Index

ITS Intelligent Transportation System

IWT Infrastructure Working Team

KPI Key Performance Indicators

KPM Key Performance Measures

LRFP Long-Range Financial Plan

LTCCP Long-Term Council Community Plan

LTNZ Land Transport New Zealand

LTP Local Transport Plan

MAC Managing Agent Contractor

MCM Maintenance Contract Management

MPMA Municipal Pavement Management

Application

NAMS National Asset Management Steering 

(committee)

NCHRP National Cooperative Highway Research 

Program

NESS Network Expansion Support System

NLTP National Land Transport Plan

NOMAD National Optimization of Maintenance 

Allocation by Decade

Abbreviations and

Acronyms
NPV Net Present Value

NRM National Roughness Measure

NSW New South Wales

PPP Public-Private Partnership

PEM Public Enquiry Management

PMS Pavement Management System

PQ Pavement Quality Index

Q/A Quality Assurance

RAB Resource Allocation and Budgeting

RAMM Road Asset Maintenance Management

RAMPS Road Asset Maintenance Policy and 

Strategy

RAMS Road Asset Management System

RAMSC Road Asset Maintenance Steering 

Committee

RAS Road Asset System

RCI Ride Comfort Index

RCIS Road Crash Information System

RCQ Roads Connecting Queenslanders

RSM Road System Management

RIMS Road Infrastructure Management System

RME Road Maintenance Effectiveness

RSP Results and Services Plan

RTA Roads and Traffic Authority

SACP Structural Annual Cost Profile

SCMI Structures Condition Marking Index

SAI Structural Adequacy Index

SCRIM Sideway-Force Coefficient Routine 

Investigation Machine

SDI Structural Distress Index

SEITA Southern and Eastern Integrated Transport 

Authority

SLDB Streetlight Data Base

SMIS Structures Management Information System

SRRS State Road Referencing System

STAMP Structures Asset Management Program

STE Smooth Travel Exposure

SWEEP Software for Whole-of-life Economic 

Evaluation for Pavements

TfL Transport for London

TAIMS Traffic Asset Information Management 

System

TAM Total Asset Management

TAMP Transport Asset Management Plan

TIMS Transportation Infrastructure Management 

System

TLRN Transport for London Road Network

TMP Transport Master Plan

TNZ Transit New Zealand

TOPS Transit Oversight Permitting System

TRACS TRAffic Condition Surveys

TRB Transportation Research Board

UKPMS United Kingdom Pavement Management 

System

WERD Western European Road Directors

WGA Whole-Government Accounting

x | ABBREVIATIONS AND ACRONYMS
TRANSPORTATION ASSET MANAGEMENT | xi

Most nations of the world have made

significant investments in transportation infrastructure. In the

United States alone, such investment is estimated at more

than $1.75 trillion. However, as this infrastructure is used and

exposed to natural forces, its condition will deteriorate. In the

United States, in particular, a significant challenge facing

national, State, and local officials is how to preserve the functionality of the existing transportation asset base while at the

same time funding expansions of the transportation network

to handle increasing demands. Although transportation officials often spend considerable time and energy on new roads,

transit facilities, airports, and pedestrian/bicycle facilities, by

some accounts, the Nation will spend more money over the

next several decades preserving and maintaining the existing

transportation base than it will building new facilities.1

The purpose of this scan was to investigate asset management experience, techniques, and processes in the world.

Lessons from this experience could help the United States

better understand how asset management applications can

be used to enhance the effectiveness of decisionmaking and

infrastructure management in Federal, State, and local transportation agencies. The United States faces a significant infrastructure preservation and capital replacement challenge. The

lessons learned from this scan could provide important indications of how those who have been practicing effective asset

management for some time have approached the challenge

from both an institutional and technical point of view.

Scan Team 

The Federal Highway Administration (FHWA), American

Association of State Highway and Transportation Officials

(AASHTO), and National Cooperative Highway Research

Program (NCHRP) jointly sponsored this scan. In addition to

FHWA officials (at the headquarters and field levels), the

panel included representatives from the departments of transportation (DOT) for the States of Michigan, New Mexico, New

York, and North Carolina; an official from the Portland, OR,

Office of Transportation representing the American Public

Works Association (APWA); a university professor representing the Transportation Research Board (TRB) Committee on

Transportation Asset Management; and a university professor

who acted as the report facilitator. These panel members represented a diverse set of interests and expertise in the areas

of asset management, bridge and pavement management

systems, transportation policy and planning, and transportation system operations.

The scan team sent each host of a site visit a set of amplifying

questions that outlined the specific information the team

desired. These questions provided a framework for the scan

team’s investigations of asset management practice, and gave

the host government an opportunity to organize its information dissemination in response to these questions. In many

cases, the team received written responses to the questions.

In others, audiovisual presentations were coded so that the

scan team knew exactly which questions were being discussed at that moment. In addition, the host agencies provided many documents and Web references relating to their

asset management practice.

General Observations 

The concluding section of this report presents a complete set

of observations and lessons learned from this scan. The following list focuses on the observations that are most critical to

understand the results of this scan.

Leadership and Organization

Any sustained organizational effort requires the involvement

of organizational leaders and champions. In all of the sites visited, asset management practice has been occurring over at

least 10 years and is continuing to evolve. Continuity in

agency leadership and long-term organizational commitment

to asset management as a business process were apparent in

1 See, for example, Kane, Anthony, R., “Why Asset Management Is More Critically Important Than Ever Before,” Public Roads, March/April 2000· Vol.

63· No. 5, http://www.tfhrc.gov/pubrds/marapr00/kane.htm; Government Accounting Office, “HIGHWAY INFRASTRUCTURE: Interstate Physical

Conditions Have Improved, but Congestion and Other Pressures Continue,” GAO-02-571, May 2002, http://www.gao.gov/new.items/d02571.pdf;

American Association of State Highway and Transportation Officials, “Transportation: The Bottom Line,” 2002. http://transportation.org/bottomline/bottomline2002.pdf; U.S. Department of Transportation, “2002 Status of the Nation's Highways, Bridges, and Transit: Conditions & Performance,” Report to

Congress, 2003. http://www.fhwa.dot.gov/policy/2002cpr/.

Executive

Summary
each case. Specific observations from the scan include the

following:

 Top-level agency commitment (at the very highest levels) in

support of asset management was apparent in every case. 

 Asset management officials identified changing the culture

of the organization to think of asset management as a key

business area as a key challenge. 

 Each agency had a management position or office responsible for asset management. 

Asset Management’s Role in Decisionmaking

Aligning asset management with an agency’s decisionmaking

process is one of the most important factors in developing an

effective and credible asset management program. Specific

observations from the scan include the following:

 In some cases, transportation agencies were competing for

resources across all government programs, and officials

pointed to an effective asset management program as one

reason they were successful in competing for additional

funding in such an institutional environment.

 Asset management programs are based on defined levels

of service for different types of assets. When funding levels

change (e.g., go down), the desired service levels are reexamined to see if they are still reasonable given fewer

resources.

 National or state legislation, in some cases, has been an

important catalyst for viewing asset management as an

important component in an agency’s decisionmaking structure.

 A good asset management program conveyed to elected

officials a sense of strong stewardship of transportation

assets, and has been an important consideration in increasing funding for transportation. 

 Asset management has been integrated into many agency

planning and policy documents. 

Technical Approaches and Data Use in Asset

Management

Asset management is a data-driven process that provides

transportation officials with a very important analysis capability. Specific observations from the scan include the following:

 Life cycle costing (also known as whole-of-life costing) had

been adopted in each site as the basic approach to program and project costing.

 Although the scan team looked for examples where tradeoff

analysis occurred among different asset categories or

among different program areas (such as maintenance, capital expansion, and capital renewal), in only a few cases did

agencies make any effort to conduct such technical tradeoff assessments, and these were heavily based on engineering judgment. 

 All of the agencies studied used risk assessment in developing their asset management programs. Agency officials

also viewed risk assessment as a way to educate and

obtain asset management buy-in from elected officials. 

 Government accounting procedures were viewed in several

cases as inappropriate for assigning value to assets and as

a driver for asset management decisions. In these cases,

asset management approaches were used to assign a value

to assets.

 Instead of creating one comprehensive database for asset

management, agencies rely on locational referencing systems to link existing asset databases. 

 The experience with deterioration modeling is not uniform

across the agencies visited, and in many cases, was quite

limited. In some instances, however, the approach to deterioration modeling and scenario analysis was quite sophisticated.

Program Delivery

Asset management practice leads to the development of a

program of investment and capital renewal. Specific observations from the scan include the following:

 Several of the visited sites have many years’ experience with

incorporating strong asset management principles in public-private partnership (PPP) agreements. The lessons

learned in this experience are important for the United

States. 

 Private contracts for delivering maintenance and minor capital construction programs were used at varying levels of

application. Although asset management practice does not

require or depend on such outsourcing, the opposite was

found to be true. If an agency is going to outsource program and service delivery, an effective asset management

program needs to be in place.

 Efforts were made in each case to reach out to public officials and, in some cases, the general public, to convey the

importance of an asset management policy. 

 In some cases (e.g., New Zealand and England), very active

asset management professional associations and user

groups, spearheaded by local officials, have developed

asset management materials and training programs aimed

at both public officials and practicing transportation professionals. 

Human Resources

An effective asset management program has a strong human

resource element. Every agency the team visited noted that a

good asset management program requires knowledgeable

staff capable of understanding the data-collection process

and what the data mean. Observations from the scan include

the following:

 Several agency personnel systems have created positions

with asset management as a job responsibility. 

 Asset management training has been an important aspect

of asset management strategy in many of the agencies visxii | EXECUTIVE SUMMARY
ited, not only for their own staffs, but also for other jurisdictions using asset management approaches. 

Lessons for the United States

A number of lessons for the United States resulted from this

scan (see Chapter 7 for a more extensive list). The most

important lessons include the following: 

 As this scan found, asset management practices and

processes have been used successfully to obtain funding

for transportation infrastructure, when competing for funds

with other government programs, and even during budget

declines.

 It is clear that asset management as an organizational culture, business decisionmaking process, and policy direction

is a critical foundation for transportation programs facing

significant capital renewal and preservation needs. The

United States clearly faces such a challenge.

 Adopting an asset management approach in an organization does not mean that dramatic change has to occur. In

the cases examined, agencies had clearly adapted their

asset management efforts to the organizational context,

and in many cases these efforts have evolved over many

years. 

 Where outsourcing of service or program delivery is used, a

strong asset management program needs to be in place to

provide overall direction and strategic guidance on service

delivery. Agency officials described this as being a “knowledgeable owner.”

 Creating asset manager positions or at least assigning

responsibilities for the asset management function is an

important foundation for an effective management program. 

 All of the asset management programs the team studied

used the concept of risk for establishing investment priorities. Most U.S. asset management experience does not

have the same level of application. Risk concepts need to

be incorporated more systematically into U.S. asset management efforts. 

 Asset management systems are much more appropriate for

determining asset valuation than are straight-line depreciation accounting rules. 

 Asset management efforts are best achieved when they are

linked to strategic goals and desired outcomes. 

 The most common asset management performance measures relate to condition, function, and capacity of the

assets. In some cases, these categories of performance

characteristics could provide the basis for cross-asset evaluation and investment prioritization. 

 Asset management should be strongly linked to planning

and system operations. 

 Perhaps one of the most important lessons for the United

States is in integrating asset management concepts into

public-private partnership agreements. A comprehensive

asset management effort needs to be part of any agreement to ensure the asset is returned to the owner in good

condition, but also to deliver good service to users during

the life of the contract.

 Developing an asset management culture in an organization does not have to wait the many years it would take to

develop database information systems. Agencies can start

with modest efforts and evolve over time into a more comprehensive approach.

 Data collected should have a clear purpose and be directly

related to asset management decisionmaking. Data-collection costs should be tracked and data itself treated as an

asset, with the same design, build, operate, maintain, and

life cycle cost analysis used for other assets.

 The concept of a gap analysis was used to identify asset

management needs. Condition and performance criteria are

used to measure current asset status, desired operational

outcomes are linked to strategic agency goals, and the

most cost-effective improvement strategies are then 

identified. 

 Cross-functional teams, consisting of engineers, planners,

finance analysts, operations staff, and communications

experts, can serve as the best means of understanding the

many aspects of asset management, such as data collection, strategy development, and quality assurance. 

 The use of focus groups to establish and/or validate

resource apportionments for different asset categories is a

useful tool in asset management programs.

 Asset management training for all levels of transportation

officials is an important initiative for changing the culture of

an organization and establishing asset management expectations among key stakeholders.

Implementation Strategies, Dissemination, and

Recommendations

The scan team identified several short- and long-term strategies for disseminating and furthering the results of this scan.

Short-Term Strategies

1. The scan results should be disseminated as widely as 

possible throughout the transportation community.

Presentations will be scheduled for the annual meetings of

TRB, AASHTO, and 6th National Asset Management

Conference planned for fall 2005. Other opportunities will

be identified by scan team members. The Transportation

Asset Management community practice Web site will be

repackaged to incorporate scan results.

2. The AASHTO Subcommittee on Transportation Asset

Management will be encouraged to continue development

of the asset management software NT and PT by

AASHTOWare. The subcommittee will also prepare a resolution for AASHTO board consideration that reinforces asset

management as an important national and State policy.

TRANSPORTATION ASSET MANAGEMENT | xiii
3. The existing National Highway Institute (NHI) course on

asset management should be updated to reflect what has

been learned on this scan.

4. A senior executive forum on asset management should be

organized to introduce senior leaders at transportation

agencies to asset management concepts. This should be

similar in format to the performance-based maintenance

contracting workshop. 

5. A national telecast/Webcast on asset management similar

to such telecasts on freight should be organized. A target

date for this is summer 2006.

Long-Term Strategies

The following three implementation strategies create a climate

of continuous process improvement on transportation asset

management in the United States.

Change the national viewpoint of the Interstate System

from merely highway expenditures to investments in

mobility of people, goods, and services by using an

asset management-based methodology that focuses 

on future conditions while identifying the cost of 

competitiveness and economic power.

Objectives

1. Advance asset management principles as the strategic tools

for assessing the entire Interstate System.

2. Compare and contrast the similarities with other countries’

highway networks, England’s trunk system in particular, and

how asset management can support the new vision for the

Interstate System.

3. Develop information on the economic impact of the degradation of the Interstate System.

4. Determine a risk-allocation process for the Interstate

System.

5. Identify performance indicators and standards for the

Interstate System to ensure its prominence in the delivery of

goods and services for the entire Nation (e.g., smoothness,

remaining service life) that are common across the system.

6. Assume a national leadership role to protect the highest

level of the transportation system, and encourage State and

local agencies to work collaboratively on the remaining

public assets.

Tasks

1. Initiate a study to determine the benefits of using asset

management plans for all segments of the Interstate

System. The study should include analysis of the economic,

social, and political impacts of requiring such plans and the

mechanisms necessary to implement such a requirement. 

2. Document asset management practice in England, including national policy, performance indicators, and reporting

requirements for national and local agencies. Draft correlating policy indicators and reporting requirements for the

United States, which could provide guidance on reporting

national, regional, and local transportation network performance. 

3. Target a State or region to take a holistic view of the entire

public asset inventory that provides increased funding flexibility. 

4. Develop linkage between transportation planning and programming and asset management at the metropolitan planning organization (MPO) level.

Join with other efforts, agencies, and resources to

embed asset management into existing efforts on an

ongoing basis. Create a National Asset Management

Steering Committee (NAMS) in the United States. Such

an effort provides a platform to distribute information,

provide training, and document best practices on transportation asset management nationally and abroad.

Develop an easy-to-understand toolbox for asset management that can be applied at different levels of government. The tools should look beyond transportation to

best practices in other industries. These tools should be

available on a Web site for free downloading.

Objectives

1. Develop a resource clearinghouse for asset management in

the United States that draws from and is directly tied to

equivalent efforts internationally and is available in the 

public domain. 

2. Market this clearinghouse to all levels of U.S. agencies and

across all types of infrastructure. 

3. Investigate whether U.S. efforts to document best asset

management practices and provide resources can be 

integrated with existing international asset management

consortia. 

4. Participate annually in a national asset management forum

to review progress, document case studies, develop 

curricula, and coordinate research efforts across 

infrastructure and Federal agencies. 

5. Inform all levels of transportation agencies—State, MPO,

and local—of this resource clearinghouse. 

Tasks

1. Meet/communicate with FHWA and the Environmental

Protection Agency (EPA) to discuss potential alliance of

asset management efforts.

2. Develop a white paper discussing the relationships among

AASHTO, FHWA, and EPA priorities and opportunities 

presented in asset management.

3. Contact the international NAMS to identify copyright

restrictions and opportunities to add the United States to

existing efforts and document U.S. case studies for inclusion in the existing library of best practices. Develop 

xiv | A
alternatives with recommendations for U.S. clearinghouse

implementation.

4. Document the state of practice at the State and local

transportation agency level in the United States as part of

establishing a national approach to transportation asset

management.

5. Communicate with State, MPO, and local transportation

agencies to inform them of training, forums, and best

practices.

6. Write articles for APWA Reporter, Public Roads, and appropriate State, municipal, and engineering journals.

7. Support benchmarking of the U.S. asset management

process (rather than performance) for local, regional, and

State agencies. This should include an assessment of the

capability and execution of linking decisions to quantified

asset-related costs and benefits as well as whether

processes have been documented and how often this

occurs. Efforts should consider incorporating the AASHTO

self-assessment survey. Share results at various State,

MPO, and local government conferences and in literature. 

8. Create an automated survey tool in the public domain that

participating agencies can complete and have results

arrayed against comparable levels of governments. 

9. Develop a national competition on transportation asset

management under FHWA’s Transportation Planning

Excellence Awards Program.

10. Develop videos and training materials aimed at various

levels of government.

Extend U.S. asset management practice through

NCHRP and other research opportunities.

The scan team identified several potential research projects:

1. Conduct before-and-after studies on the effectiveness of

asset management efforts and the identification of benefits.

2. Establish state-of-the-art practices for data collection and

analysis for asset management.

3. Define and quantify risk categories for an asset management program.

4. Synthesize data management principles, collection, sampling, and auditing techniques for asset management.

5. Examine world experience with high-speed deflectograph

technology, looking at the Denmark technology identified in

the England case study.

6. Examine more closely transportation assets other than

bridges and road pavement, such as appurtenances, transit,

streetlights, etc.

7. Synthesize practice with how three-dimensional (3-D) or

design files are linked to geographic information 

systems (GIS).

TRANSPORTATION ASSET MANAGEMENT | xv
TRANSPORTATION ASSET MANAGEMENT | 1

Most nations of the world have made

significant investments in transportation infrastructure. In the

United States alone, such investment is estimated at more

than $1.75 trillion. However, as this infrastructure is used and

exposed to natural forces, its condition will deteriorate. In the

United States in particular, a significant challenge facing

national, State, and local officials is how to preserve the functionality of the existing transportation asset base while at the

same time funding expansions of the transportation network

to handle increasing demands. Although transportation officials often spend considerable time and energy on new roads,

transit facilities, airports, and pedestrian/bicycle facilities, by

some accounts, the Nation will spend more money over the

next several decades preserving and maintaining the existing

transportation base than building new facilities.

Transportation asset management has been defined many different ways. In essence, it is a strategic approach to inventorying, monitoring, and managing at desired levels of performance the many different assets that constitute a transportation

system.

The purpose of this international scan was to investigate 

best-case examples of transportation asset management

techniques and processes in the world. Lessons from this

experience could help the United States better understand

how asset management applications can enhance the effectiveness of decisionmaking and infrastructure management in

Federal, State, and local transportation agencies. The United

States faces a significant infrastructure preservation and 

capital replacement challenge. The lessons learned from this

scan could provide important indications of how those who

have been working on this issue for some time have

approached the problem from both an institutional and 

technical point of view.

Scan Team

Asset management is an important concept to transportation

professionals working at many levels of government and in

the private sector. To reflect this range of potential application,

the scan panel represented a diverse set of interests and concerns for national, State, and local-level decisionmaking. The

Federal Highway Administration (FHWA), American

Chapter 1:

Introduction

Association of State Highway and Transportation Officials

(AASHTO), and National Cooperative Highway Research

Program (NCHRP) jointly sponsored this scan. In 

addition to FHWA officials (at the headquarters and field 

levels), the panel included representatives from departments

of transportation (DOT) for the States of Michigan, New

Mexico, New York, and North Carolina (in addition to 

representing the AASHTO Subcommittee on Transportation

Asset Management); an official from the Portland, OR, 

Office of Transportation representing the American Public

Works Association (APWA); a university representative 

representing the Transportation Research Board (TRB)

Committee on Transportation Asset Management; and a 

university professor who was the report facilitator. These panel

members represented a diverse set of interests and expertise

in the areas of asset management, bridge and 

pavement management systems, transportation policy 

and planning, and transportation system operations 

(see Appendix A for contact information and biographical

sketches for scan team members).

Scan Study

Several nations, states/provinces, and local governments are

at the cutting edge of asset management practice. As the

scan team found, however, even these asset management

practitioners are in a continuous process of learning. Based

on a scoping process of international experience in asset

management, the scan team chose to investigate the asset

management practice in Alberta and Edmonton, Canada;

England and London, United Kingdom; New Zealand; and

New South Wales, Queensland and Brisbane, and Victoria,

Australia. This mix of site visits thus included two national

experiences (England and New Zealand); four state/provincial experiences (Alberta, New South Wales, Queensland,

and Victoria); and three local experiences (Brisbane,

Edmonton, and London).

The scan team met with the following types of representatives

during its 15-day study: 

 National transportation agencies—England and New

Zealand

 National rail provider—England

 Provincial or state departments of transportation—Alberta
(Canada) and New South Wales, Queensland, and Victoria

(Australia) 

 City transportation and infrastructure officials—Brisbane

(Queensland), Edmonton (Alberta), in England (representing London and other local governments), and in New

Zealand (representing urban and local communities)

 Transit provider—Brisbane (Queensland)

 Toll authorities—New South Wales and Victoria

 Public-private partnership concessionaires—New South

Wales and Victoria

 Private providers of maintenance services—England

 Research organizations—England, New South Wales, and

Victoria

 Professional engineering/asset management associations—

Australia, England, and New Zealand

The scan team sent each host of a site visit a set of amplifying

questions in advance that outlined the specific information 

the team desired (see Appendix B). These questions provided 

a framework for the scan team’s investigations of asset 

management practice, and gave the host government an

opportunity to organize its information dissemination in

response to these questions. In many cases, the team

received written responses to the questions. In others, 

audiovisual presentations were coded so that the scan team

knew exactly which questions were being discussed at 

that moment. The team also received a great deal of 

supplementary material from the host agencies.

Report Organization

Given the different circumstances and challenges facing 

governments at the national, state/provincial and local levels,

this report is organized by level of government. Chapter 2

examines the national government experience in England

(even though it is a part of the United Kingdom) and New

Zealand. Chapter 3 examines asset management experience

at the state/provincial levels, focusing on Alberta, New South

Wales, Queensland, and Victoria. Chapter 4 presents the

results of the team’s visit to local governments, including

Brisbane, Edmonton, and London. Chapter 5 examines one of

the aspects of good asset management practice that was not

anticipated before the scan—the important role of professional

and local government associations in asset management.

Chapters 6 and 7 present general observations and lessons

learned from this scan. The final chapter describes 

recommended implementation steps for the scan findings.

To provide consistency among the different asset management experiences, each case description follows the same

format. Each description provides sections on context, how

the agency has organized for asset management, the 

drivers for asset management, asset management in the 

decisionmaking process, use of performance measures, 

asset management systems, data-collection strategies and

techniques, the analysis and prioritization procedures used to

rank asset management strategies and projects, and general

observations.

Given that the most effective asset management programs 

are often found within a larger agency performance-oriented

decisionmaking structure, the concepts of performance 

measures and strategic planning become important points 

of departure for understanding effective asset management

programs. To learn more about performance measures, see

the scan report on performance measures, Transportation

Performance Measures in Australia, Canada, Japan, and New

Zealand, available at www.international.fhwa.dot.gov. 

In each case, monetary amounts are reported in the country’s

own currency unit, followed by a conversion to U.S. dollars.

Similar conversions are shown for metric distance measurements. In the case of currency, although much of the financing information is reported from planning and budgetary 

documents prepared over the past 10 years, the conversion

rates into U.S. dollars were those on April 24, 2005. Although

this suggests the buying power of the monetary estimates

might be different from that intended in these documents,

such a conversion serves the purpose of comparing 

investment levels consistently from one country to another.

2 | CHAPTER 1
TRANSPORTATION ASSET MANAGEMENT | 3

Two of the sites the scan team visited

represented asset management experience at the national

government level. As might be expected, not only do national

agencies have their own responsibilities for managing assets

(e.g., road networks), but they also play an important role in

educating, guiding, and in some cases mandating asset management practices to other governments. The scan team’s two

national experiences with asset management were those for

England and New Zealand. 

ENGLAND2

Highways Agency—www.highways.gov.uk

Context

England is a world leader in transportation, known for having

one of the lowest road fatality rates of any country in the

world as well as for applying innovative technologies and

methods for managing its infrastructure. The road network in

England can be considered in two parts. The strategic or

national network is managed by the Highways Agency and

the nonstrategic, or local, network is managed by local

authorities. Although England has initiated important processes and procedures for asset management, it still has important challenges in improving the condition of the road network. A recent trend in major road deterioration was halted

only in 2004 when significant funding was allocated to maintenance for this part of the network. Today, on local roads,

almost 4,000 bridges still need strengthening and 2,844 need

major maintenance. About 32 percent of England’s lighting

columns are more than 30 years old, their expected useful life. 

One reason for this state of affairs is that local governments

(of which there are 150 in England) are responsible for a large

portion of the road network, but the funds they receive from

the national government ostensibly for transportation purposes can be used for any governmental purpose. Not surprisingly, given strong public pressures for quality education and

social services, some of this funding is allocated to nontransportation activities (an estimated 8 percent of the national

transportation funding allocation). 

At the national level, the

Highways Agency of the

Department for Transport

is responsible for

England’s major roads.

This includes about 7,754

kilometers (km) (4,818

miles (mi)) of major arterial roads, carrying 25 percent of England’s traffic

volume and 50 percent of

its heavy vehicle movements. One interesting

aspect of the Highways

Agency’s road network is

that, unlike other countries the team visited, the

mileage for which the

Highway Agency is

responsible has decreased

each year over the past

decade because the

agency has been turning

roads and bridges back to

local governments

(referred to as 

“detrunking”). 

The agency’s annual

budget is £5.5 billion (US$11 billion), with about £850 million

(US$1.7 billion) going for road maintenance. The Highways

Agency Business Plan for 2005/06 states that £2.5 billion

(US$5.0 billion) has been allocated over the next 3 years for

road maintenance. 

The road network is divided into 14 operational areas with

each area managed by a managing agent (MA), a private

consultant usually operating under a 5-year contract. There

are two forms of MA. In the first form, the consultant is a separate organization from the contractor carrying out the 

Chapter 2:

National Experience with

Asset Management

ENGLAND

NEW

ZEALAND

Transportation

Infrastructure

Managed

By Highways Agency 

(Strategic Roads in England)

 7,754 km (4,818 mi) of roads

 16,000 structures

 Communications equipment such

as message signs, including 5,500

emergency roadside telephones

 Safety fences and 3,500 km

(2,175 mi) of boundary fences

In England

 275,000 km (170,885 mi)

 65,000 bridges

 4.7 million lighting columns

National Rail Infrastructure

 40,000 bridges

 25,000 km (15,535 mi) 

of major earthworks

 700 tunnels

 23,000 culverts

 17,000 retaining walls

 177 sea walls

2 Most of the agency representatives participating in this visit represented England, not the United Kingdom, so Northern Ireland, Scotland, and

Wales were not part of the discussions.
maintenance for the area. In the second form, the area is

managed and maintained by a company that combines the

managing consultant with the maintenance contractor. The

agent for the second form is known as a managing agent

contractor (MAC). These managing agents are an important

implementing structure for the Highways Agency’s asset 

management program. England has also been divided into

four traffic operations regions. 

The Highways Agency’s stated aim is “Safe roads, reliable 

journeys, informed travellers,” with the following specific

objectives:3

1. To deliver a high quality service to all our customers by:

 Reducing congestion and improving reliability

 Improving road safety

 Respecting the environment

 Seeking and responding to feedback from our customers

2. To ensure more effective delivery though better working

relationships

3. To implement best practice and innovative solutions to

improve service now and in the future

4. To be a good employer

5. To be an efficient agency with effective business processes

and resource management systems

As the list shows, asset management is not a stated objective

of the Highways Agency. This is in part because of its view of

itself as a traffic service provider, as well as its philosophy 

that asset management is engrained into all of the agency’s

functions.

The strategic planning guidance for 2006 and beyond lists the

following priorities for the road network:4

Highest Priorities

 Delivering the new traffic management role, including the

progressive roll-out of traffic officers, regional control centers (jointly manned with the police) and supporting technology on the most congested parts of the motorway network. This will help to reduce congestion and delays to

journeys through managing traffic, clearing incidents, and

providing better-quality information to road users.

 Maintaining and improving safety on the network to deliver

the safety target and meet the aim of the Safer Roads policy. This will be achieved through the safety benefits of

major projects and by carrying out a program of small safety schemes and improvements.

 Maintaining the network in a safe condition whilst minimizing the whole life costs. This helps avoid unplanned or

more extensive and disruptive maintenance projects in

future years.

Given the tremendous backlog in maintenance on local roads

that accrued over the past decade (estimated at £3.75 billion

(US$7.5 billion)), the national government set targets to halt

the decline in local road pavement condition by 2004 and to

eliminate the backlog by 2010. Eliminating the maintenance

backlog was a policy objective that local transport officials

mentioned continually during the scan team’s visit. Highways

Agency officials stated that no maintenance backlog for road

pavements exists on the national network, but they believed a

backlog exists for local road maintenance.

Drivers for Asset Management

One of the most important drivers for asset management in

England has been governmental directives on transport policy

and accounting procedures. A tradition of managing road

assets began in 1825 when Parliament stated that it was government’s “duty to maintain” infrastructure built with public

funds. The more recent evolution in asset management is best

explained by examining governmental policies and procedures

occurring over the past 10 years. 

The national government published a white paper in 1998

entitled A New Deal for Transport: Better for Everyone and a

report called A New Deal for Trunk Roads in England. Three

major investment areas were identified in these reports—

maintenance, operations, and capital improvement—along

with investment criteria on safety, environment, economy,

accessibility, and network integration. They also identified new

directions for the Highways Agency, one of which was to “give

priority to the maintenance of trunk roads and bridges with

the broad objective of minimizing whole life costs.”

A Local Government Act of 1999 defined governmental

responsibility as stewards of public funds as being a “general

duty of best value.” A best-value authority must “make

arrangements to secure continuous improvement in the way

its functions are exercised, having regard to a combination of

economy, efficiency and effectiveness.” This act was preceded

4 | CHAPTER 2

“Many people think asset management is just a

fancy term for maintenance...it isn’t.”

—MAINTENANCE CONCESSIONAIRE

3 http://www.highways.gov.uk/aboutus/intro.htm, accessed 8/3/05. 4 Highways Agency, Strategic Planning Guidance: 2006-07 and Beyond, London: England, March 2005.
by a Compulsory Competitive Tendering (CCT) policy, which

required local authorities to follow certain processes when

delivering its services, thus leading to increased privatization

of service delivery. This also changed the bid selection process

from low bid to best value.

This concept of “best value” has found its way into many

technical guidelines and processes. For example, Delivering

Best Value in Highway Maintenance, published by the

Institution of Highways and Transportation, is what is called

a “code of practice” for maintenance management.5 In this

document, the key principles of asset management are

defined as follows:

 Focusing on life cycle costing

 Management of strategies for the long term

 Establishing and monitoring levels of service

 Managing risk of failure or loss of use

 Sustainable use of physical resources

 Process of continuous improvement

The code clearly places asset management at the center of

guaranteeing best value in the road sector. 

A Transport Act of 2000 gave local authorities a statutory

requirement to produce local transport plans (LTPs) covering

the timeframe of 2001/2002 to 2005/2006. A national program

provided money (£1.6 billion/US$3.2 billion) for local governments to hire private contractors to manage the condition of

the network and reduce their maintenance backlog, with

agreement that the governments would fund this responsibility

after 5 years. So far, 20 local authorities have participated in

this program.

The most recent Transport Act requires another round of LTPs

covering the years 2006/2007 to 2010/2011. In the guidance to

local governments for preparing this second round of plans,

the Department for Transport used the following language.

Because this guidance so clearly links asset management to

transportation planning, the relevant sections are presented in

their entirety.6

“Achieving value for money through asset management

Well-maintained local transport assets—including roads, footpaths, byways, bridleways and cycle paths—are essential to the

delivery of better transport outcomes. They encourage walking

and cycling, and contribute to road safety outcomes. They promote the quality and comfort of bus services, improve journey

ambience, minimize wear and tear to vehicles, and promote

TRANSPORTATION ASSET MANAGEMENT | 5

5 Institution for Highways and Transportation, Delivering Best Value in Highway Maintenance, Code of Practice for Maintenance Management,

Basildon Essex, England, July 2001. 6 Department for Transport, Full Guidance on Local Transport Plans, 2nd ed., London, England, Dec. 2004, accessed at

http://www.dft.gov.uk/stellent/groups/dft_localtrans/documents/page/dft_localtrans_504005.hcsp. 7 The County Surveyors Society is described in Chapter 5. 

better environmental outcomes including emissions and noise.

Well maintained roads, footways, footpaths, streetlights and

street furniture make a vitally important contribution to the

quality and livability of public spaces, and the quality of rural

landscapes. LTPs should therefore clearly demonstrate how

effective maintenance will contribute to the achievement of

other targets and objectives. Local transport authorities may

also wish to adopt effective and efficient maintenance as an

important LTP objective in its own right—in particular through

the development of Transport Asset Management Plans and

Rights of Way Improvement Plans. 

Local Transport and Highway Authorities should follow two key

principles of value-for-money asset management when preparing and delivering their LTP: 

 Firstly, to achieve the best possible value for money, maintenance work must be carried out in good time. It is essential

that authorities do not allow the total costs of maintenance

to escalate by allowing assets to deteriorate to the extent

the routine maintenance is no longer possible. Similarly,

authorities should aim to ensure that maintenance works are

not carried out more frequently than necessary. 

 Secondly, authorities should consider carefully the future

maintenance requirements of proposed new infrastructure

before including it in their LTP. It may be that the whole lifetime cost of a capital scheme will be such that the transport

need that it is designed to address could be more efficiently

met through less capital-intensive or even revenue-funded

interventions.

Transport Asset Management Plans

Local authorities have for many years been required to demonstrate that they are making the best use of their property and

other assets, in the form of Asset Management Plans. These

are made available to both Central Government and to their

regional Government Office as required. The Department is

now encouraging local authorities to extend this to transport

assets, by drawing up Transport Asset Management Plans

(TAMPs), informed by LTPs and other services and corporate

plans. The County Surveyors Society,7 together with the Local

Authority Technical Advisors Group, has produced a framework

for highways asset management. The Department recommends local transport authorities develop asset management

plans consistent with that advice. Public Transport Enterprises

and other transport authorities should consider the management of assets related to the transport system that they own

(such as depots and bus facilities), even if they are not part of

the public highway network. 
6 | CHAPTER 2

“Moving into asset management is all about

changing organizational culture.”

—LOCAL GOVERNMENT OFFICIAL, ENGLAND

The compilation of a TAMP will provide an authority with a

tool to: 

 Support the corporate provision of detailed information on

the assets held by the whole authority—enabling better definition of longer-term corporate need and continual challenge to asset holding/use; 

 Establish and communicate a clear relationship between the

program set out by the TAMP and the authority’s LTP targets and objectives, and ensure existing assets are in a condition compatible with the delivery of the LTP; 

 Obtain and organize information to support the forthcoming

(2006) requirement for Whole Government Accounting

(WGA); 

 Enable the value for money of local road maintenance to be

considered more effectively against other local transport

spending, and eventually assist local transport strategy and

plan production. 

Effective TAMPs will provide the means for authorities to

understand the value and liability of their existing asset base

and make the right strategic decisions to ensure this base is

exploited to its full potential and its value safeguarded for

future generations. Where appropriate the TAMP strategy

should be coordinated with those of neighboring authorities—

for example, where there may be benefits from the co-ordination of maintenance work on a particular corridor. In some

cases it may be appropriate for TAMPs to make reference to

infrastructure owned or operated by bodies other than the

authority itself, where the transport benefits of such infrastructure depend on the good upkeep of related authority-owned

assets. 

Evidence about the quality of asset management within local

transport authorities will form a component of the

Department’s assessment of provisional LTP quality.

Although TAMPs are not required to be submitted with

the provisional LTP, it should provide evidence that the

development of a TAMP has informed the development

of the LTP. Provisional LTPs should include a short summary

of such evidence—the LTP TAMP report (a page or so

from each contributing local authority should be sufficient

in most cases). 

This should set out the state of each local authority’s progress

in developing an effective TAMP, what has already been

achieved, and any remaining challenges. As well as detailing

progress towards a whole-life maintenance plan for existing

assets, the LTP TAMP report should cover briefly such issues

as the ambition and realism of LTP asset management targets,

the whole-life maintenance resource implications of the major

and other integrated transport schemes proposed in their local

transport plans, and the implications of any LTP proposals to

delay or bring forward maintenance work. The TAMP report

should aim to demonstrate that authorities are exploiting their

existing asset bases to their fullest potential and managing

future maintenance liabilities efficiently. The Department will

consider the evidence in LTP TAMP reports before deciding

whether to require further evidence in final March 2006 LTPs.”

Another law, the Traffic Management Act of 2004, gave local

authorities responsibilities for traffic management on local

roads.8 All local authorities are required to appoint a traffic

manager and this appointment gives the local authority the

ability to take over traffic enforcement from the local police.

This act has provided the Highways Agency with improved

liaison with local governments on transport matters.

Legislation and government policies relating to procurement

have also influenced asset management procedures. Several

major studies during the 1990s highlighted problems with traditional methods of procuring and managing major projects,

especially the awarding of contracts solely on the basis of

lowest price. The 1999 Gershon Report entitled Efficiency in

Civil Government Procurement emphasized the benefits of privatized service delivery. The 2001 report of the National Audit

Office entitled Modernizing Construction made recommendations on how to achieve sustainable improvements in construction performance, resulting in better value for the taxpayers’ money. Recommendations were also made to government

departments to develop more sophisticated performance

measures and to measure improvements in construction performance.

Perhaps even more important in encouraging greater 

attention to asset management were Treasury guidelines on

resource allocation and budgeting (RAB).9 RAB is a system 

of planning, controlling, and reporting on public spending.

Issued in 1993, the guidelines were followed by a 1995 gov8 See, http://www.dft.gov.uk/stellent/groups/dft_roads/documents/page/dft_roads_026488-01.hcsp#P15_304. 9 Department of Treasury, Managing Resources, Full Implementation of Resource Allocation and Budgeting, London, England, July 2001, accessed at :

http://www.hm-treasury.gov.uk/mediastore/otherfiles/rab30_03.pdf.
ernment white paper that committed to the use of resource

accounting as the basis of public expenditure planning and

control. Asset remaining useful life must be used to arrive at a

current asset value, usually determined through straight-line

depreciation. All local authorities have until 2006 to report

their asset accounts in this format; the Highways Agency has

already done so for 5 years. 

In addition to the RAB requirements, the Treasury has adopted financial reporting requirements for local authorities wanting to debt finance infrastructure improvements, something

that until recently has not been allowed. Known as the

Chartered Institute of Public Finance and Accountancy

(CIPFA) Prudential Code, this document states that local

authorities wishing to borrow funds must “prove prudent

stewardship of their assets,” and specifies that a fully developed asset management plan will satisfy this requirement.

Organization for Asset Management

The Highways Agency has defined successful asset management as consisting of several steps: 

 Setting strategy and standards

 Recording the asset

 Identifying maintenance needs

 Prioritizing and managing maintenance needs 

 Managing work programs and outcomes

 Influencing maintenance through design

 Measuring performance

 Innovating and developing

At the top management level, the Highways Agency’s

Business Plan identifies the performance measures that

reflect the different products and services to be delivered.

Other more technical guidance on asset management 

is available for specific asset categories. For example, asset

management for roads and structures is guided by documents entitled Continuous Value Management Guide: Roads

and Continuous Value Management Guide: Structures.

As noted earlier, the Highways Agency relies on the MA and

MAC to achieve a single-point responsibility for asset 

management and maintenance in the operating areas.

Begun in 2001, this program requires the MA/MAC to use

quality management systems and to self-certify compliance,

thus reducing the level of supervision. The MAC can design

and undertake all projects up to a value of £500,000 (US$1

million). Performance specifications for routine and winter

maintenance are included, along with annual targets to

measure and benchmark performance and to achieve 

continuous improvement.

Decisionmaking Approach

Figure 1 (see following page) indicates how asset management occurs in the Highways Agency. The references inside

the “databases” box are the different management information systems discussed below. Four key documents guide the

decisionmaking process in the Highways Agency—the

Corporate Strategic Plan, Business Plan, Balanced Scorecards,

and Annual Report.10 Each has asset management elements

incorporated into it, although in some cases not in very prominent ways. For example, one aim of the latest Business Plan

(2005/2006) is maintaining of the road network at minimum

whole life cost, with pavement condition being a key performance indicator. In addition to these corporate documents, the

Highways Agency has a developed strategic plan for maintenance. 

Pavement asset data are the most used in supporting agency

decisionmaking. Uses of this data include calculating a road

condition index, availability key performance indicator, and

safety key performance indicator; developing the investment

program; supporting a quieter surface program; defining

budget allocations; and linking to the agency’s Web site for

public information. Table 1 (see following page) shows how

the pavement asset data are used to support information

requirements.

Performance Measures

National law requires the adoption of performance indicators

for all publicly supported services and functions. Given the

emphasis on best value, the scan team was not surprised to

find that the most important indicators were called Best-Value

Performance Indicators (BVPIs). These high-level indicators,

few in number, provide annual snapshots of performance for

government-supported activities. For the transportation sector,

the Department for Transport has made the following BVPIs

mandatory for annual reporting by local authorities.11

 Principal road condition 

 Nonprincipal classified road condition 

 Unclassified road condition 

 Total killed and seriously injured casualties 

 Child killed and seriously injured casualties 

 Total slight casualties 

 Public transport patronage—based on the BVPI related to

total bus patronage, but authorities may adjust the indicator

to include other local public transport modes

 Customer satisfaction with bus service

 Footway condition

Authorities are expected to develop additional indicators that

they can use to guide specific aspects of their service delivery.

TRANSPORTATION ASSET MANAGEMENT | 7

10 See, Highways Agency, http://www.highways.gov.uk/aboutus/corp_docs.htm. 11 Highways Agency, Business Plan 2005/2006, see: http://www.highways.gov.uk/aboutus/corpdocs/bus_plan/2005_2006/.
8 | CHAPTER 2

Figure 1. Asset management practice in England’s Highways Agency.

PAVEMENT ASSET DATA

Information

Requirement Network Inventory Construction Traffic LaneClosures

Condition

Data

Maintenance

KPI ✓ ✓ ✓ ✓ ✓

Availability KPI ✓ ✓

Investment

Program ✓ ✓ ✓ ✓

Asset Valuation ✓ ✓ ✓ ✓

Quieter

Surfacing

Program

✓ ✓

Table 1. Business uses of pavement asset data in England’s Highways Agency.

KPI = Key performance indicator
In the Highway Agency’s Business Plan, two measures 

relating to asset condition were reported as follows: 

For the safety measure, the road surface condition index is

based on surveys covering rutting, paved surface unevenness,

cracking, and skid resistance.

The Highways Agency is also developing performance indicators for structures, some of which are still in the early stages

of development. These indicators include the following:

 Condition—a measure of the physical condition of the 

structures stock

 Availability—a measure of the reduction in the service 

level provided on the network because of restrictions 

on structures, including long-term and temporary works

restrictions

 Reliability—a representation of the ability of the structures

stock to support traffic and other appropriate loading, 

taking into account the consequence of failure

 Structures Workbank—the cumulative cost of all work 

identified for and arising from inspections, assessments,

and other needs

There was a sense among Highways Agency officials that the

agency might be moving toward a composite, or what they

termed an “amalgam,” asset management performance 

measure within the next several years. 

The team noted some tension in the Highways Agency

between goals to reduce congestion and maintain infrastructure. Given the political interest in showing progress

toward congestion reduction, the natural tendency is to

structure planning and performance dissemination around

this goal. However, the need to maintain infrastructure not

only requires substantial funding, but also contributes to

traffic congestion when projects are underway. It will be

interesting to see how this tension between the two agency

goals will play out in coming years, because it is a tension

that many U.S. transportation agencies also face.

The performance measures local authorities use as part of

their transport plan updates (which include asset management strategies) must be quantifiable and measurable targets.

An example of this is found in highway lighting management.

A group called the Roads Liaison Group developed a Code of

Practice for Highway Lighting Management (November 2004),

which recommended that local authorities use national 

performance indicators in their asset management efforts, but

develop others more relevant to their own situation. As noted

in this report, two main categories of performance indicators

should be considered:12

1. Internal management information to monitor and control

service delivery (it is not expected that this information will

be published)

a. Average time to identify a fault

b. Number of actual patrols completed

c. Average time from identification of fault to issue of 

instruction for repair

d. Time from instruction to completion of fault repair

e. Percentage of return visits

f. Number of callouts to emergencies

g. For training, time from instruction to completion

2. To publish in the public domain (including reporting to the

national government)

a. Total number of faults identified by:

i. Authority patrol

ii. Public reporting

iii. Other reports

b. Percentage of lights working as planned

c. Total number of failed or faulty service connections

d. Total number and cost of incidents of:

i. Vandalism/willful damage

ii. Vehicular impact.

Asset Management Information Systems

Historically, management information systems in the Highways

Agency have been developed independently for all assets. The

Highways Agency Pavement Management System (HAPMS)

has been under development since 1998, and has cost about

TRANSPORTATION ASSET MANAGEMENT | 9

Measure

Estimated proportion of the

network likely to require

maintenance in the next

year

For safety, road surface 

condition index

Target

7% and 8%

(2000/01–

2003/04)

100 ± 1 2005-2006

100 ± 1 2005-2006

100 ± 1 2006-2007

100 ± 1 2007-2008

Outcome

Achieved

7.9%

(2003/04)

99.4%

“The best argument for asset management is that it provides

service to the community in the most efficient way.”

—DEPARTMENT FOR TRANSPORT OFFICIAL

12 Roads Liaison Group and UK Lighting Board, Well-lit Highways Code of Practice for Highway Lighting Management, November 2004, found at:

http://www.dft.gov.uk/stellent/groups/dft_roads/documents/page/dft_roads_037869.pdf.
US$3.5 million per year (not including data collection) to

develop. As figure 2 shows, HAPMS receives data from a 

variety of sources and provides outputs to a public Web site, 

a program investment development tool, and budget analysis.

SWEEP in this figure stands for Software for Whole-of-life

Economic Evaluation for Pavements, a tool that can be used 

to establish priorities for pavement investment strategies.

Members of the Highways Agency and its transportation 

partners can access HAPMS.

Although not developed solely by the department for 

transportation purposes, a United Kingdom Pavement

Management System (UKPMS) has been evolving over the

past 15 to 18 years for use on local roads. In U.S. terms,

UKPMS is an architecture for pavement management systems

that suggests functionalities and characteristics, but does not

mandate specific vendors or software systems. UKPMS has

standard techniques for condition assessment and inventory,

and provides facilities for recording inventory, assessing the

condition of paved assets, and costing and prioritizing potential projects works on condition and economic factors. The

Department for Transport has been strongly encouraging local

authorities to adopt UKPMS as the framework for their pavement management systems. To date, vendors of five pavement

management systems have been accredited as meeting

UKPMS conditions. The Highways Agency’s pavement management system has not been assessed against the system

architecture requirements.

The Highways Agency also has a Structures Management

Information System (SMIS), a repository of condition data for

all structures on the national network. Not surprisingly, given

the age of England’s bridges and the history associated with

innovations in bridge design emanating from England, many

bridges are considered “heritage” bridges, requiring special

handling. For example, 60 percent of the bridges in

Northumberland, located in northern England, are heritage

bridges. 

Other asset management systems that provide information to

the decisionmaking process include HAGDMS, a geotechnical/slopes database; HATRIS, a traffic information system;

10 | CHAPTER 2

Figure 2. Highways Agency Pavement Management System (HAPMS).
HA-ES, an environmental management system; and NOMAD,

a technology equipment database. 

Figure 3 shows Highways Agency’s current thinking on a

desired direction for an agency-wide infrastructure asset

management system. As the figure shows, this desired structure includes closer integration of the different databases

and a strong linkage to strategic management. The databases used as the traditional support systems for engineering

decisionmaking remain as the foundation for future activities

(the lower level in the triangle). However, the agency envisions new management systems to aggregate this data and

to produce information for use in performance reporting and

monitoring and ultimately in strategic management activities.

In addition, several Highways Agency officials noted that a

major focus of agency attention is on traveler information,

which in figure 3 is a major recipient of the data stored in

the databases.

The previously mentioned Code of Practice for Highway

Lighting Management recommends that local authorities

develop and operate detailed asset management systems of

their public lighting stock to do the following:

 Assist in the effective maintenance management of the

assets in accordance with the authority’s defined 

maintenance strategy. 

 Enable appropriate risk assessment strategies to be 

formulated. 

 Facilitate the purchase of electricity for unmetered equipment. 

Fault and repair histories, together with the results of inspections and electrical and structural testing, were recommended

to determine future asset replacement programs. The types of

management information that would come from such a system include analysis of trends, identification of recurring faults

and specific component failure, monitoring of response times,

and a spatial distribution analysis to determine if some parts

of a jurisdiction are experiencing unusual amounts of maintenance trouble.

Data Collection

Highways Agency staff members played an instrumental part

in developing a data management guide for an organization

called the Western European Road Directors (WERD). Much

of what is in this guide reflects the philosophy of the

Highways Agency on a data-collection strategy for asset

management. For example, the seven steps to successful

data management were described as 1) determine business

TRANSPORTATION ASSET MANAGEMENT | 11

Figure 3. Desired structure of a future asset management system for the Highways Agency.
information needs, 2) review current situation, 3) analyze

data, 4) design a data management regime, 5) develop 

an implementation plan, 6) establish a data management

organizational structure, and 7) continually review and

improve the strategy.

Much of the data collected as part of HAPMS relates to 

pavement condition, which has evolved over the past 30 years,

as the following time line shows:

1977 Manual visual surface assessment 

(using 100 meter segments)

1984 Slow-speed machine structural assessment

1988 Medium-speed skidding assessment

1990 High-speed surface assessment

1998 First generation stand-alone integrated database

2001 Second generation desktop delivery

The types of data collection that occur in many local authorities include the following (taken from the instructions for the

UKPMS):

1. Coarse Visual Inspection—Coarse Visual Inspection (CVI)

is usually carried out from a slow-moving vehicle or by

walking (often the mode of operation for local governments), and allows a large part of a highway authority’s

road network to be assessed each year. As the name

implies, this inspection is conducted visually with teams of

inspectors subjectively rating asset condition. This visual

survey provides data to produce BVPIs on the condition of

local authorities’ roads. 

2. Detailed Visual Inspection—Detailed Visual Inspection

(DVI) is a more comprehensive survey, with defects 

identified by a larger number of more detailed classifications.

DVI is a walking survey that is typically targeted at lengths

already identified as defective and potentially in need of

treatment by the CVI or some other information source. DVI

records areas or lengths for a wider range of more closely

defined defects. The defects collected for DVI are generally

defined at a closer level of detail than found in CVI. DVI is

used where more detailed information is required to support

and validate treatment decisions and scheme identification.

3. SCANNER Surveys—SCANNER surveys are high-speed

surface condition surveys on local roads based on the

Highways Agency TRAffic-speed Condition Surveys

(TRACS) consultant contract for national roads. 

SCANNER collects the following data:

 3-D spatial coordinates

 Road geometry

 Survey speed

 Longitudinal profile

 Wheelpath rutting

 Texture profile

 Cracking

Measures of edge condition and overall transverse uneveness are being developed. Similar vehicles are used for

SCANNER and TRACS surveys. The TRACS vehicle is capable of traveling at speeds of up to 70 kilometers per hour

(km/h) and through the use of video cameras and laser

sensors can detect cracks and measure ruts on the road

surface. 

4. SCRIM—The Sideway-Force Coefficient Routine

Investigation Machine (SCRIM) was introduced in the early

1970s to provide a method of measuring the skidding resistance of wet pavements. The normal testing speed for the

machine is 50 kilometers per hour (km/h), and skidding

resistance values for the nearside wheel track only (usually

the location of the lowest skidding resistance) are generally

recorded as the average for each 10-meter (m) (10.9-yard

(yd)) section. SCRIM surveys make use of functional

defects, which in essence serve as triggering thresholds

that prompt treatment if they are below the target value and

can be shown to have contributed to an increase in the

number of accidents. 

5. Deflectograph—The deflectograph is used to assess the

structural condition of flexible and flexible composite

pavements. As a loaded wheel passes over the pavement,

the pavement deflects, and the size of the deflection is

related to the strength of the pavement layers and 

subgrade. Measurements of deflection are taken at

approximately 3-m (3.3-yd) intervals in both wheelpaths

while the machine is in motion. The Highways Agency 

has recently purchased a high-speed deflectograph from

Denmark that will allow network data collection of 

pavement strength at traffic speeds. 

6. Machine-Measured Rutting—Although it is possible to

assess wheel track rutting manually, where SCANNER 

surveys are not used the preferred option is to measure 

rutting using machine-based technologies, either as part of

a CVI survey or as a separate rut survey. Two special survey

types of machines have been created that can support the

collection of such data with visual surveys. 

The above data-collection tools are primarily for road 

condition. The Highways Agency has received some criticism

for not having data on several other asset types, such as light

columns and drainage. Accordingly, the 2007/2008 target year

for the agency’s Business Plan has a goal of completing an

inventory and condition record of all asset categories under

the agency’s responsibility.

12 | CHAPTER 2

“We had bags of data, but not much information.”

—MAINTENANCE CONCESSIONAIRE
Analysis Procedures and Prioritization

Similar to data collection, the analysis and prioritization

approaches used in the Highways Agency have evolved over

the past 30 years. For establishing priorities, this evolution 

has included the following:

1977–2000 Stand-alone condition-based trigger criteria

2000–2004 Whole-life cost spreadsheet 

2005 + Integrated whole-life costing module in HAPMS

Project prioritization also includes identifying and managing

risks associated with the road network. The prioritization

process involves using a risk matrix in which projects or

project types are assigned a score. Figure 4 illustrates the

use of risk in assigning priorities to projects pertaining to

bridges and other structures.13 As shown, each box in the

figure relates to a probability of failure occurring for a specific reason, with higher likelihood of failure resulting in

greater attention in the investment program. Probabilities are

found in look-up tables in a Highways Agency manual. For

example, the likelihood of a risk event can be calculated as

the following:

L(Risk Event) = L(Cause) x L(Defect) x L(Exposure) x L(Effect)

where L stands for likelihood. Assume that the table 2 serves

as the source of likelihood values (in reality, there would be

separate tables for different components of the process in figure 5). For a particular project, it has been determined that the

likelihood of cause is high (0.85), the likelihood of defect is

medium (0.50), the likelihood of exposure is low (0.15), and

the likelihood of effect is high (0.85). The risk associated with

this project is thus estimated as the following:

L(Risk Event) = 0.85 x 0.50 x 0.15 x 0.85 = 0.054

By conducting a similar assessment for all structures projects,

one can identify the projects that pose the highest risk of failure and allocate funds to solve the most serious problems.

Table 3 (see page 16) is a scoring matrix used by managing

agents and Highways Agency personnel to assign priorities to

road maintenance projects. Value management workshops,

which include participation from project sponsors, contract

agents, specialists on pavement treatments, and Highways

Agency program development staff, are used to review the

scores the managing agent has assigned to each project.

Projects are classified as “committed,” “unavoidable,” or

“desirable.” Each project must be analyzed with the software

program SWEEP (the Incremental Economic Indicator (IEI)

and user costs shown in table 3 are calculated with this software package). Base conditions are analyzed as well as future

whole-of-life treatments over a 60-year analysis period.

SWEEP will calculate the project cost (including traffic management costs) of each treatment option, as well as the associated user costs. The result of this analysis is a 4-year program of investment. 

For asset valuation, the whole-of-government accounting

approach requires valuation of the asset base (inventories 

needed), and depreciation (condition of asset needed). In

renewals accounting, on the other hand, deterioration is

based on condition change and differences from required 

TRANSPORTATION ASSET MANAGEMENT | 13

Table 2. Values for calculating likelihood of risk events.

Likelihood

Rating Description

Range of

Likelihood

Values

Midpoint

Values

Certain Certainty 1.0 –

High Highly likely 0.7–0.99 0.85

Medium Likely 0.3–0.69 0.50

Low Possible, but

not likely 0.0–0.29 0.15

Figure 4. Similar to other countries, England has significant

challenges maintaining the condition of historic bridges.

“We used the term ‘optimize’ to mean obtaining the most economically efficient

answer . . . however, given the broad reach of asset management,

‘optimize’ means supporting decisions with facts.”

—LOCAL OFFICIAL

13 Highways Agency, Value Management of the Structures Renewal Program, London, England, Oct. 2004.
levels of service. In England, valuations are required of all

assets by 2006/07 and renewals accounting by 2007/08. The

Highways Agency’s road network is professionally valued

every 5 years, using equivalent replacement cost. Depreciation

is calculated, taking into account the condition of the network.

Estimates based on inflation and construction cost indices are

used to calculate values for in-between years. Renewals

accounting is used for assets that meet the renewals criteria.

The Highways Agency has also adopted a policy to examine

maintenance requirements during the project design phase to

see if the design can be changed to lower the life cycle costs

of the project. As an example of this, the Highways Agency

has published a design standard for fiber-reinforced polymer

(FRP) bridge decks that offer lower life cycle cost designs.

Asset Management at Network Rail

The extensive passenger transportation system in England

afforded the opportunity to examine the asset management

practices of other transportation modes. One of these modes

was Network Rail, the owner of the rail infrastructure in

England. (Rail operators pay Network Rail to use the rail network.) Network Rail is responsible for an extensive asset

inventory, not the least of which is 40,000 rail bridges. The

asset management process is guided by engineering policies

that indicate required condition levels and acceptable performance ranges. About 300 inspectors examine the network

each year, with one-sixth of the network subject to a detailed

inspection and the remaining five-sixths undergoing visual

inspection.

Network Rail has developed a costing model called Structures

Annual Cost Profile (SACP) for use in policy development and

regulatory review. In addition, a Structures Condition Marking

Index (SCMI) is used for bridges, tunnels, retaining walls, culverts, and earthworks to assign priorities. Data are incorporated into a STructures Asset Management Program (STAMP),

which is based on whole-life costing procedures. The STAMP

rates assets on a score of 1 to 100, where each asset element

is weighted from 1 to 10 and defect severity and extent also

are rated from 1 to 10. Figure 6 shows the type of information

that can be produced from the asset management program.

Network Rail also uses STAMP to assess the policy implications of different scenarios. For example, three scenarios used

in a recent study include the following:

1. Return and maintain the stock to steady state using maintenance activities that will improve performance levels and

the remaining life of existing assets. 

2. Allow structures to deteriorate until repairs or replacements

are essential to maintain operational requirements. At the

time of intervention, carry out interventions that achieve

lowest long-term costs for structures.

3. Allow structures to deteriorate until intervention is essential

to maintain safety standards or raise performance to an

acceptable level.

Observations

The Highways Agency is similar to many transportation agencies in the United States, facing important challenges not only

with asset condition, but also significant political pressures to

alleviate congestion. This has created tension between the

two goals in terms of service delivery. 

Several aspects of England’s approach to asset management

merit special attention. As in other cases, England seems to

be ahead of most U.S. agencies in applying performance

measures to asset management as well as other transportation goals. Performance measures or best-value performance indicators are found at all levels of government and

provide consistency in the type of information produced at

the national, regional, and local levels. This observation is

not surprising, given that national legislation and government policy have encouraged this consistency for many

years. An example of this consistency is found in the government policy of reducing the maintenance backlog by 2010;

such a performance measure was found in plans at all levels

of government. 

Much of the road network service delivery in England is done

with private contractors. The performance orientation and

reporting of best-value performance indicators are found in

these contracts as well. In addition, national policy has strongly encouraged the use of privately financed services to reduce

the maintenance backlog, with the national government providing funding to pay for the first 5 years of such an approach

to maintenance with an agreement for local government support thereafter.

England also appears much more concerned about some

types of transport assets that receive less attention in the

United States. For example, a great deal of attention has been

paid over the past several years to the condition of streetlights. A deterioration model is being developed that will allow

transportation agencies to prioritize investments for this asset.

Similarly, more attention appears to be given to appurtenances and footpaths/sidewalks than is typical in the United

States.

The Highways Agency is investing in new technologies for

more efficiently collecting condition data critical to asset management decisions. An example of this is the high-speed

deflectograph vehicle recently purchased from Denmark. 

Asset valuation is based on depreciated values, which are calculated with a straight-line depreciation method. Starting in

2007/2008, the Treasury will require a renewals approach to

14 | CHAPTER 2
asset value, which depends on asset management as a means

of determining asset remaining useful life.

Local government and professional association involvement

in supporting asset management is quite impressive. Similar

to New Zealand (see next case), an association of asset

management professionals and local officials has become

very important in providing technical information on asset

management. The documents it has produced are basic references on the subject, and the most influential document, 

A Framework for Highway Asset Management, has laid out

the fundamental structure for asset management that all 

levels of government appear to follow. Another group, 

the Roads Liaison Group, has produced codes of practice 

that guide local asset management formulation and 

decisionmaking.

Finally, the concept of an asset manager as a professional job

appears to be evolving in England. Several regional and local

groups market jobs this way, or have attached asset management as a responsibility to the more traditional civil engineering job description. It will be interesting to follow this development for its impact on human resource development strategies and university transportation programs.

TRANSPORTATION ASSET MANAGEMENT | 15

Figure 5. Calculation of risk of failure for structures in England.
16 | CHAPTER 2

Table 3. Value management scoring framework for maintenance projects in England.14

14 Highways Agency, Value Management of the Regional Roads Programme, London: England, March 2005.

Figure 6. Bridge condition distribution, Network Rail, England.

CRITERIA (and weighting factor)
TRANSPORTATION ASSET MANAGEMENT | 17

NEW ZEALAND

Transit New Zealand—www.transit.govt.nz

Context

New Zealand has been a world leader in many aspects of

road network management. In asset management, New

Zealand has implemented innovative performance-based

maintenance contracts, established a performance-oriented

asset management decisionmaking structure, and is the home

of one of the most active local government and professional

association-supported programs for furthering asset management goals. 

Two national agencies have primary responsibility for New

Zealand’s transportation system (see figure 7). Transit New

Zealand (Transit NZ)15 manages a 10,836-km (6,733-mi)

national road network, constituting 11.5 percent of the

length of New Zealand’s roads. This national road network

handles about 50 percent of the total vehicle-kilometers

traveled each year in the country. Land Transport New

Zealand (Land Transport NZ) funds police, safety programs,

and public transportation. Transfund, part of Land Transport

NZ, is the major source of funds for highway investment

and a critical player in establishing transport priorities.

According to New Zealand’s Transport Strategy, Land

Transport NZ’s focus in its investment is on “improving system management, promoting alternative modes of transport,

reducing reliance on motor vehicles, improving energy efficiency, and reducing adverse effects of transportation system use.”16

Both agencies operate under national legislation that emphasizes not only an important role for transportation in moving

people and goods, but also the critical linkages between

transportation system performance and other national goals.

For example, a recent law required government agencies to

reexamine their operations to determine how they can better

create a sustainable New Zealand. As a consequence, Transit

NZ has adopted a mission statement that states that its

responsibility is “to operate the state highway system in a way

that contributes to an integrated, safe, responsive and sustainable land transport system.”17

It is important to note that the transportation agencies in New

Zealand compete with other nongovernmental programs for

resources (except for revenues dedicated to transportation).

This whole-of-government context places even greater importance on transportation agencies to justify their funding

requests. 

Transit NZ officials identified several challenges

facing the country’s transportation system. New

Zealand faces increasing

growth on the transportation system that far outpaces the addition of new

capacity, both in passenger and freight movement.

This is especially true in

Auckland, the country’s

largest metropolitan area.

In addition, the pavement

replacement schedule is

not meeting deterioration rates, and Transit NZ has found that

some structures are not lasting as long as expected. The

country also faces shortages in professional staff and construction/maintenance resources (all system operations and

maintenance are outsourced to private firms). 

Officials also stated that New Zealand has been fortunate that

its pioneering history was based on lightweight and temporary

construction, which ingrained a maintenance-first mentality

into the culture. However, the officials admitted that it is

becoming more difficult to convince elected officials of the

desirability of this philosophy in light of demands for new

infrastructure to match the rapidly escalating demand.

Drivers for Asset Management

Asset management has occurred in New Zealand for several

reasons. First, a national law requires all government agencies

to value the national assets under their jurisdiction. For the

national highway network, the required valuation outputs are

the replacement cost and depreciated value of the network.

These are estimated annually on a regional basis with the

results aggregated to a national total for the state highway

network. 

Second, the stewardship mentality found in great abundance

in New Zealand for its natural resources is also found in the

governmental perspective on its responsibilities to the people

of New Zealand. Maintaining a functioning transportation 

system at desired levels of service is part of the governmental

ethic guiding planning and decisionmaking. An asset management program was considered part of the management

support structure that would achieve such stewardship. The

Land Transportation Management Act of 2004 has also added

a new twist to this stewardship role. By adding sustainability

Infrastructure

Managed

 10,836 km (6,733 mi) of 

paved road

 2,600 bridges

 16 timber bridges

 1,400 culverts greater than 

2 m in diameter

 158,800 signs

 37,000 street lights

 7 tunnels

15 Note that the word “transit” in this case does not mean public transportation; Transit New Zealand is the agency responsible for the national

strategic road network in New Zealand. 16 See http://www.beehive.govt.nz/nzts/downloads.cfm. 17 See http://www.transit.govt.nz/about_transit/index.jsp.
to Transit NZ’s objectives, asset management takes on an

environmental quality element as well. The objectives are as

follows:

 Ensure state highway corridors make the optimum contribution to an integrated multimodal land transport system.

 Provide safe state highway corridors for all users and

affected communities.

 State highways will enable improved and more reliable

access and mobility for people and freight.

 Improve the contribution of state highways to economic

development. 

 Improve the contribution of state highways to the environmental and social well-being of New Zealand, including

energy efficiency and public health.

Third, given that maintenance activities on the national road

network have been privatized, Transit NZ realized that managing this type of program delivery, and in particular determining

the right mix of activities, required good information on the

performance and condition of the network. About two-thirds

of these 5- to 10-year contracts are performance based. This

strategic program perspective has led to increased interest in

a comprehensive asset management effort.

A final driver for asset management in New Zealand is a

consortium of national and local government associations

and consultants called the National Asset Management

Steering committee (NAMS), which was formed in 1995 to

champion asset management. This group has played an

important role in fostering improvements to asset management practice in New Zealand and through its publications

in other parts of the world (see Chapter 5 for more discussion of NAMS).

Organization for Asset Management

Transit NZ is organized into four major groups/divisions, an

organizational structure replicated in the regional offices—

transport planning, network operations (where the asset management responsibility lies), capital projects, and organizational support. Within this structure, the agency has defined different job positions with asset management responsibilities.

About 50 people nationwide have responsibility for asset

management, including those in Transit NZ’s regional offices.

Appendix C includes three job descriptions for asset management-related positions. 

One of the scan team’s important observations on how

asset management is organized in New Zealand is that it is

part of the strategic planning, performance monitoring, and

accountability structure established in all levels of government. Transit NZ and Land Transport New Zealand, for

example, follow asset management guidance found in

numerous plans, manuals, and statements of policy. The

New Zealand case, perhaps more than any others, showed

18 | CHAPTER 2

Figure 7. Organizational structure for transportation in New Zealand.
a much higher level of integration of asset management

concepts and principles into the day-to-day activities of the

transportation organizations. 

Reliance on outsourced maintenance service delivery also has

had an impact on Transit NZ. Initially, the philosophy was that

outsourcing allowed the client to significantly downsize and

downskill. Perhaps inevitably, this has been found not to be so

and Transit has had to rebuild the skill base, but for different

functions (specifying performance, auditing, and interacting

with its suppliers to achieve better outcomes). Overall, the

human resources required to deliver the total package has

been significantly reduced. 

Contractors are required to maintain their own performance

audit systems (open to review by Transit NZ); Transit NZ

audits about 5 percent of the network to assure quality 

performance. If the performance is acceptable, determined

at regular (at least annual) reviews, the contractor is 

provided first right of refusal for all work within his network

up to a project value of some NZ$400,000 (US$280,000). 

This is a relaxation of normal competitive pricing rules to

gain efficiencies of an established contractor who knows the

network, has a team in place, and can offer good prices on

the basis that it has up to 10 years’ work secured through

the maintenance contract. Eligible contractors usually end

up undertaking all of the minor capital works projects in

their network as well as the maintenance activities outside of

the lump-sum maintenance contract (for example, major

drainage work). All contractors are expected to be ISO 9000,

or equivalently, certified. Each region also has a consultant

contract to help monitor and supervise service delivery either

within the contractor team for 10-year contracts or employed

by Transit New Zealand for 5-year contracts.

The human resource element is another important aspect 

of organizing for asset management. Transit NZ conducts 

an annual asset management workshop, holds training 

seminars when new approaches or policies occur, supports

conferences and technology seminars, and participates in

local asset management forums with 72 local authorities.

Regional network operational managers meet every 

2 to 3 months to exchange information and experiences.

Even more impressive are the activities of various local 

governments and professional organizations in furthering

asset management principles. This is discussed in further

detail in Chapter 5.

Transit NZ is also a major participant in the research efforts of

Austroads, the association of Australian and New Zealand

road transport and traffic authorities, as they relate to asset

management. This research focuses on pavement failures, levels of service, and cost models.

Decisionmaking Approach

Decisionmaking in the New Zealand transportation agencies

is guided by several tiers of planning activities conducted

annually.18 At the strategic level, agencies must prepare a

statement of intent that identifies proposed investment activities over 3 years, including how such investment will achieve

performance targets. Each agency also has a strategic plan,

updated every year, that links adopted transportation goals to

key result areas and agency activities. A national state highway strategy defines the capital and preservation strategies

that will be used to meet adopted goals and performance targets. A network statement is also prepared for each of 25

contract areas that includes the following information on each

infrastructure network: network description, overview of condition, issues/goals, performance measures and triple bottomline reporting, asset management practices and strategies,

current contractual commitments for maintenance, safety

impacts, performance targets, a 10-year works program based

on modeling (including pavement deterioration), and a

description of any new initiatives. Performance agreements

are also signed between the agencies and the responsible

party (in this case, the Minister of Transport) that spell out

how performance will be measured in the coming year.

At the more tactical level, network annual plans (again for the

25 contract areas) are prepared. (Regional networks range

from 200 km (124 mi) to 700 km (435 mi) long). These annual

plans are aggregated to form a national operate-and-maintain

plan. These annual plans, based on levels of service, include

funding requests; demonstrate delivery/historic trends, network condition, and future strategies; and provide justification

for investment (for maintenance, this is often linked to the

national asset management plan discussed below). Levels of

service are defined by road type, usually tied to volume, (e.g.,

greater than 10,000 vehicles a day, 10,000 to 4,000 vehicles a

day, 1,000 to 4,000 vehicles a day, and less than 1,000 vehicles

a day). Every asset has associated level-of-service measures. If

the budget for a particular asset category is cut, these levelof-service measures are revisited. 

Most important from the perspective of asset management,

Transit NZ uses a National Asset Management Plan (AMP) to

guide transportation asset-related planning and resource allocation decisions (the latest version was in draft form at the

time of the scan team’s visit). This plan is instrumental in

establishing the process and substance of asset management

at the national level in New Zealand. Figure 8 shows the asset

management process described in this plan. The AMP is

TRANSPORTATION ASSET MANAGEMENT | 19

18 See the following website for copies of Transit New Zealand’s publications, http://www.transit.govt.nz/news/index.jsp
20 | CHAPTER 2

organized in the following sections:

 Introduction and plan objectives

 Levels of service and performance standards

 Asset management business practices 

 Asset portfolio description (inventory, condition, and performance)

 Future demand and growth

 Risk management

 Life cycle management, operations, maintenance, renewals,

capital, and disposals (at the structural and corridor levels)

 Financial summary (cash-flow forecasts and valuation and

decline in service potential forecasts)

 Plan improvement, review, and monitoring

The draft national operate-and-maintain plan to meet agreed

levels of service is discussed and negotiated with Land

Transport NZ. The effects of funding less than what the draft

plan requires are discussed. The final funding reflects the balance between available funding and the need to maintain

service levels. Land Transport NZ is also the source of funds

for police and public transport activities, so the existence of

the asset management plan is viewed as an important basis

for justifying budget requests.

Transit NZ is also incorporating asset management concepts

into other activities and planning efforts. For example, 

given the government’s emphasis on sustainability, Transit

NZ has developed a new agency environmental plan, 

which is closely integrated with asset management. 

The types of asset management activities included in this

plan are as follows:

 Recycling and reusing resources to reduce waste 

 Adopting noise standards for routine maintenance works

 Using noise-reducing surfaces

 Using noise, water, and landscaping retrofitting as 

funding allows

 Experimenting with low-growth roadside grass species

 Reporting on environmental performance

 Working with suppliers to improve environmental 

performance

Figure 8. Transit New Zealand’s asset management process.
The decisionmaking process for determining priorities is based

on whole-of-life costing (known in the United States as life

cycle costing) procedures, which includes deterioration modeling to determine useful lives. Whole-of-life costing considers all

costs over the lifetime of an asset, discounted to the present.

Given defined levels of service for each maintenance activity, a

gaps analysis is used to determine maintenance needs.

Figure 9 illustrates the relationships among the many different

components of the asset management decisionmaking

process in New Zealand.

For funding priorities, Land Transport NZ uses a six-step allocation process as its primary decision support framework for

making tradeoffs among many different projects. The National

Land Transport Programme (NLTP), produced annually, covers

funding for local roads, state highways, passenger transport,

and other activities (in addition to its safety and police funding). It also includes a 10-year financial forecast. About 52

percent of NLTP funding goes to support the state road network and 30 percent to local roads. Of the total NZ$1.16 billion (US$812 million) allocated in the 2004/05 NLTP budget

for state and local roads, about NZ$300 million (US$210 

million) goes to maintenance of the State Highway network

(another NZ$300 million goes to subsidize local road 

maintenance).

Performance Measures

Performance measures and indicators are

found at all levels of planning and decisionmaking in New Zealand (see figure

10). At the strategic management level,

such measures and indicators are defined

in the Statement of Intent, where targets

are set at the start of each year and

reconfirmed at midyear. An annual report

shows progress on these indicators and

presents information on the economic,

environmental and social goals that constitute the triple bottom line. It also

includes a pavement condition report that

includes measures relating to roughness,

rutting, texture, and skid resistance.

Operational performance measures cover

issues such as availability of the network,

level of congestion, safety, and response

times. Financial information is also presented for program progress and delivery

accountability. In addition, a monthly traffic light report presents progress reports

against key performance measures in the

form of a green (okay), yellow (warning),

and red (action required) color scheme. 

At each level, performance is measured in both absolute

terms and trends.

Transit NZ also collects information on user satisfaction with

the road network. For maintenance and asset condition, it has

established a target of 90 percent of road users rating their

satisfaction with the road network as good or above. The road

characteristics included in this survey are traffic flow, road

safety, road surface, road marking, road signs, rest areas, and

quality of the roadside environment.

At the network level, Transit NZ reports on numerous performance measures and indicators. An annual high-speed

network condition survey provides input into key performance measures (KPMs) and key performance indicators

(KPIs). An example of the type of information reported is

shown in figure 11 (see page 22). Project-level performance

measures include levels of service, pavement condition, and

maintenance response times. Similar measures are incorporated into maintenance contracts covering network condition, operations, and system management. These measures 

govern what happens in the contracted service delivery.

These measures are aggregated and combined with other

data to produce a whole-of-network picture.

TRANSPORTATION ASSET MANAGEMENT | 21

Figure 9. Business model of asset management in New Zealand.
applications to Land Transport NZ. These

levels of service not only serve as the basis

for performance reporting, but they also

serve as the inputs into maintenance 

performance contracting. 

Transit NZ learned many years ago that a

smaller, more targeted number of performance measures is most useful to the

agency. When the agency started using

performance measures, it began with 230

measures. This was pared down to 32 when

Transit NZ officials realized that 230 

measures were too difficult to comprehend.

Because of environmental and sustainability

concerns, the number of measures now

approaches 70. 

Table 4 illustrates the type of asset 

management data presented to senior agency officials in 

various documents.

Land Transport New Zealand heavily depends on level-ofservice measures when establishing funding priorities. For

example, the latest guidelines to authorities in developing the 

Levels of service are defined for each work activity in 

the asset management plan. These levels of service were 

determined from historical trends and through a Delphi

process with agency staff and other professionals, and 

with community input. Levels of service are also defined 

for each maintenance activity and used to support funding

22 | CHAPTER 2

Figure 10. Use of performance measures in Transit New Zealand.

Figure 11. Network rutting reporting in New Zealand.
Land Transport Program included the following types of maintenance measures that funding submitters should consider:

Road User Satisfaction Measures

 Maximum average roughness on sealed roads

 Maximum roughness on roughest sealed roads

 Number of maintenance-related faults likely to affect driver

behavior

 Adequacy of destination and directional signs

 Visibility not restricted by dust

 Corrugations on unsealed roads

 Availability of road after emergency closure

 Number of maintenance-related hazards on cycle ways

requiring evasive action

Road Safety Measures

 Adequate provision, visibility, and reflectivity of traffic service facilities for safe travel at normal day and night operating speeds on wet or dry road

 Adequate skid resistance on all sealed roads

 Loose gravel on unsealed roads

 Sight distance is not restricted by vegetation growth/trees

 All traffic-restraining devices are maintained in an effective

operating condition

 Where shoulders are provided, they are maintained 

in a state that allows safe stopping or recovery 

by vehicles

 Roadside safety zones are maintained free of unauthorized

obstructions

TRANSPORTATION ASSET MANAGEMENT | 23

Percentage of the state highway network complying with agreed levels of

service and standards for road conditions and geometry.

Level of service and standard

Actual 2001/02 Actual 2002/03 Target 2003/04 Actual 2003/04

Percent

Percent of network classified

as smooth 99 99 97 99

Percent of expectation of smooth

travel 99 99 97 99

Percent of network <20-mm ruts 99.99 99.8 99 99.6

Percent of network with good skid

exposure above threshold level 99 99 98 99

Percent of network with texture

greater than 0.5 mm 99.5 99.6 98 99.5

Table 4. Examples of performance measures used by Transit New Zealand.

Percentage of the state highway network with a current

state highway or corridor management plan.

Measure

Actual 2002/03 Target 2003/04 Actual 2003/04

Percent

Percentage length of network with

current state highway plan 93 85 88

Percentage change in maintenance cost per 100,000 VKT (100,000 VMT).

Maintenance Measures 2000/01 2000/02 2000/03 2003/04

Expenditure ($ millions) NZ$242.9 (US$170) NZ$247.6 (US$173) NZ$273.5 (US$191) NZ$285.3 (US$200)

Total VKT (VMT) in 100,000s 16,977 (10,550) 17,571 (10,919) 18,061 (11,223) 18,681 (11,608)

Expenditure per

100,000 VKT (VMT)

NZ$14,310

(US$16,114)

NZ$14,090

(US$15,844)

NZ$15,140

(US$17,019)

NZ$15,272

(US$17,229)

Percentage change per

100,000 VKT or VMT -6.0 -1.5 +7.5 +0.8
24 | CHAPTER 2

Change (because of investment, revocation, or depreciation) in the dollar value of the state highway asset.

Total Asset Value

2000/01 2001/02 2002/03 2003/04

NZS (US$) in millions

Depreciated Replacement Cost NZ$11

(US$7.7)

NZ$12

(US$8.4)

NZ$12.5

(US$8.7)

NZ$13

(US$9.1)

Description 2003/04

Target

2004/05

Target

2005/06

Target

2006/07

Target

Variance in percentage terms between forecast

and actual dollar expenditure on state highway

maintenance program at February review

98-102 98-102 98-102 98-102

Periodic

Maintenance

Achievement

 Percentage achievement of

National Land Transport 

Program outputs

97.5-102.5 97.5-102.5 97.5-102.5 97.5-102.5

Levels of

Service

Percentage of

state highway

classified by:

 Roughness

— smoothness

— smooth travel exposure

97

97

97

97

97

97

97

97

 Rutting—less than 20-mm ruts 99 99 99 99

 Skid resistance—good skid exposure above threshold level 98 98 98 98

 Texture—greater than 0.5 mm 98 98 98 98

Percentage of forecast and actual annual dollar variance against state highway

maintenance and improvement program.

Expenditure 2003/04 Budget 2003/04 Target 2003/04 Actual 2003/04

(Revised Feb.)

2003/04

(Revised June)

$NZ ($US) in millions

Maintenance

320.3 (224) 327.4 (229) 321.1 (224.7) 331.2 (231.8)

Percent

102.2 98-102 102 98.9

$NZ ($US) in millions

Replacement

and

Improvement

340.7 ($238) 360.3 ($252) 322.6 ($226) 355.9 ($249)

Percent

105.8 Less than 103 111.7 101.2

Table 4, continued
TRANSPORTATION ASSET MANAGEMENT | 25

Structural Maintenance Measures

Description Unit 2001/02 Actual 2002/03 Actual 2003/04 Target 2003/04 Actual

Cost $NZ ($US) millions 105.6 ($74) 119.8 ($84) 127.6 ($89) 126.8 ($89)

Length km (mi) 10,783 (6,700) 10,786 (6,702) 10,798 (6,710) 10,837 (6,734)

Unit Cost $/km ($/mi) 9,795 ($11,045) 11,107 ($12,534) 11,817 ($13,264) 11,701 ($13,216)

Resurfacing Measures

Description Unit 2001/02 Actual 2002/03 Actual 2003/04 Target 2003/04 Actual

Cost $NZ ($US) millions 68.9 ($48) 74.3 ($52) 77.1 ($54) 73.2 ($51)

Length km (mi) 1,298 (807) 1,328 (825) 1,450 (901) 1,231 (765)

Unit Cost $/km ($/mi) 53,106 (59,480) 55,949 (63,030) 53,172 (59,933) 59,464 (66,667)_

Corridor Maintenance Measures

Description Unit 2001/02 Actual 2002/03 Actual 2003/04 Target 2003/04 Actual

Cost $NZ ($US) millions 73 ($51) 79.4($56) 82.7($58) 85.3($60)

Length km (mi) 10,783 (6,700) 10,786 (6,702) 10,798 (6,710) 10,837 (6,734)

Unit Cost $/km ($/mi) 6,768 ($7,612) 7,361 ($8,356) 7,659 ($8,644) 7,871 ($8,910)

Preventive Maintenance

Description Unit 2001/02 Actual 2002/03 Actual 2003/04 Target 2003/04 Actual

Cost $NZ ($US) millions 4.3 ($3.0) 5.2 ($3.6) 5.8 (4,0) 5.4 (3,8)

Property Management Measures

Description Unit 2001/02 Actual 2002/03 Actual 2003/04 Target 2003/04 Actual

Cost $NZ ($US) millions 8.2 ($5.7) 9.1 ($6,4) 9.3 ($6,5) 10.2 ($7,1)

Asset Value $NZ ($US) millions 341 ($239) 445 ($312) 360 ($252) 545 ($382)

Emergency Works Measures

Description Unit 2001/02 Actual 2002/03 Actual 2003/04 Target 2003/04 Actual

Cost $NZ ($US) millions 18.3 ($12.8) 15.3($10.7) 17.8 ($12.5) 26.5($18.6)

Table 4, continued
26 | CHAPTER 2

 Carriageway lanterns are maintained in an effective operational condition

 Traffic signals operational at all times

Asset Preservation Measures

 Change in pavement integrity index of sealed network

 Length of sealed network overdue for resurfacing

 Structural integrity of structures is not diminished by lack of

maintenance

 All bridge waterways clear of significant obstructions

 All drainage facilities functioning satisfactorily

 Adequate pavement depth maintained for unsealed roads

In an overview document targeted at maintenance activities,

Land Transport New Zealand identified several measures that

were particularly important, including smooth travel exposure,

a sealed road condition index, and a pavement integrity index.

Asset Management Information Systems

Transit NZ has a suite of asset information systems used in

providing information to the decisionmaking and prioritization

process (see figure 12). The Road Asset Maintenance

Management (RAMM) system, begun in the 1980s, includes

the primary road inventory, condition data, and treatment

selections and interfaces with the pavement design system. It

is used by Transit NZ staff and consultants, and can be used

as a distributed system. Seventy-two local authorities also use

this system. The National Optimization of Maintenance

Allocation by Decade (NOMAD), a module of RAMM, develops a 10-year program of investments by treatment type. A

pavement modeling tool, dTIMS, uses deterioration modeling

to predict future pavement condition (there are 85 dTIMS

licenses in New Zealand, but not all license holders use the

software). In this application, the road network is segmented

into like-performing roads and appropriate treatments are

identified for different performance levels. 

Transit NZ’s Traffic Monitoring System (TMS) includes five

weigh-in-motion sites (dial up and noncontinuous), 70 continuous traffic count sites, and 1,000 noncontinuous traffic count

sites. TMS is used primarily for reporting traffic volumes and

trends in growth and weight, and for enforcing truck weight

restrictions. A bridge information system is available, but it is

not as developed as RAMM. It consists simply of an asset

register of bridge structures (BDI), a bridge structural index

(BSI), and an overweight vehicle management system (Transit

Overweight Permitting System (TOPS)). When combined with

bridge management consultants, this relatively unsophisticated system has proved capable of managing the bridge stock.

Transit NZ is developing a more sophisticated overweight

vehicle management system to rectify some shortcomings in

TOPS and giving some thought to more integrated bridge

management systems. RAMM also includes a traveler information system (0800) and a limited-access road database

(LAR) for planning purposes.

Transit NZ is implementing a Location Referencing

Management System with spatial capabilities designed to provide a more integrated database approach to future asset

management activities. The desire is to integrate the process

of information production, not develop one comprehensive

database. Figure 12 also shows the future relationships that

the referencing system will provide. 

Data Collection

Pavement condition data drive the performance measurement

process. Data are collected both visually on 10 percent of the

road network each year and across the whole national network with a high-speed data-collection vehicle called a

Sideways-Force Coefficient Routine Investigation Machine

(SCRIM). This vehicle collects data at 10-m intervals for skid

resistance, rutting, roughness, and texture and videotapes the

network. These data are measured in both wheel paths to

allow a comparison across the entire paved surface. The highspeed data collection occurs via private 3-year contracts (valued at NZ$1 million (US$700,000 a year), and covers about

22,000 lane-kilometers (13,670 lane-miles) each year.

Tendering is on the international market and is now sourced

from the United Kingdom.

Pavement strength data are collected with a falling weight

deflectometer at 200 m. These data are collected via private

contractor on highways with over 2,000 average annual daily

traffic (AADT), and cover about 10,000 lane-kilometers (10,900

lane-miles) each year (or once every 3 years). Roughness is

defined at 100-m (109-yd) and 20-m (21.9-yd) sections, rutting at 20 m (21.9 yd), skid resistance and rutting at 10 m

(10.9 yd), and geometry at 10 m (10.9 yd). To calibrate this

data-collection activity, Transit NZ uses 52 calibration sites

throughout the country. A walking profilometer is used to validate IRI measurements.

Transit NZ also collects data from transportation users.

Surveys of road users occur every 2 to 3 years. Focus

groups also have been used. In response to survey 

information, Transit NZ has placed greater emphasis on

providing more passing lanes and improving sections of

road with the highest level of roughness (of concern 

to truck drivers). In addition, a NZ$12 million (US$8.4 

million) to NZ$15 (US$10.5) program over 3 years was

implemented to fix undulations in road vertical profiles,

which the trucking industry had identified as a 

problem to truck ride quality. As Transit NZ officials 

noted, one challenge of this type of data is relating 

varying levels of user satisfaction to the service levels

Transit NZ provides. 
Analysis Procedures and Prioritization

Land Transport NZ does not propose projects, but instead

reviews project requests. The funding priorities are determined by relating proposals to legislative requirements,

including sustainability, economic development, safety, 

access and mobility, public health, and 

environmental quality. In early 2002, the government established specific priority areas

for targeted land transport funding: severe

congestion, public transport, walking and

cycling, regional development, alternatives

to roads, and safety. The government continues to identify key issues. Regional strategies that are part of transport plans are also

important justifications for project priorities.

For new capital projects, the seriousness

and urgency of the need, the project’s effectiveness, and a benefit/cost ratio must be

provided. Projects are rated as high, medium, or low priority. Given recent changes to

legislation, Land Transport NZ officials

believe that the quantitative thresholds for

project justification might be lowered to

account for factors not easily quantified,

such as sustainability.

Maintenance has historically received first

priority in Land Transport NZ’s prioritization

scheme. Approved organizations (i.e., local

authorities and Transit NZ) must prepare

asset management plans, and present

annual statistics that indicate changes in

the asset base, network status as it relates

to performance measures, and work

achieved. Instructions to the approved

organizations are issued early in the previous fiscal year and cover the type of information and analyses desired. Maintenance

funding priorities are based on historic

costs, trends in network condition, benchmarking with other organizations, links to

national objectives, and relationship to the

asset management plan. Land Transport

New Zealand places a great deal of emphasis on asset management planning, and it expects robust

asset management practices to include complete inventory

databases, optimized decisionmaking, life cycle strategies,

long-term planning, level-of-service outcomes, and linkage

to national and regional strategies.

TRANSPORTATION ASSET MANAGEMENT | 27

Figure 12. Current and future systems configuration at Transit New Zealand.

“We need effective processes in place so that we can be confident of identifying and

managing significant risks to our business. . . . Better decisions, processes,

plans, and programs are the intended results. The goal is to enhance our chances

of success and to minimize the potential for failure through greater risk

awareness and proactive management.”

—RISK MANAGEMENT PROCESS MANUAL, TRANSIT NZ, 2004
At the national level, Transit NZ uses a whole-of-life costing

procedure to determine net present values of proposed projects (using a 10 percent discount rate). If the cost of the project is more than 10 percent of this value, it is elevated to the

status of a reconstruction project. All projects must be justified, either by a benefit-cost ratio for capital projects or some

other form of justification for smaller projects (e.g., least-cost

analysis for renewals compares ongoing maintenance costs

against replacement cost). 

Scenario analyses of alternative budget assumptions and corresponding performance levels are conducted using dTIMS.

Transit NZ has developed an Asset Valuation Manual that

defines the approach for valuing different assets (one-third of

the network is revalued each year), calculating replacement

costs (see table 5) and identifying remaining service life. Life

cycle costs are assumed over 25 years for pavements, and

pavement design life is assumed to minimize whole-of-life

costs. Transit NZ officials had concerns about the concept of

remaining service life. Questions they are struggling with

include the following: When is structural integrity compromised, and thus the end of useful life? For assets such as ITS

equipment, how does one determine remaining useful life? As

a performance measure, remaining service life becomes a

check on contractor maintenance strategies. Transit NZ can

determine, for example, if contractors are avoiding more costly

maintenance and using up the structural life of the pavement.

The measure for pavement replacement cost is based on the

depth of granular overlay that would bring the pavement up to

a 25-year remaining life.

Transit NZ depends on its regions and network service areas

to develop plans and priorities for the networks for which they

are responsible. Two such plans were reviewed for this report,

Hawke’s Bay Network Management Area and PSMC001

Network Management Area. In both cases, analysis was done

on network characteristics relating to skid resistance, texture,

pavement roughness, rutting, and granular overlay

deficit. Other measures relating to safety and

social/environmental factors were also discussed.

These plans then examined maintenance needs and

recommended treatments.

Observations

The New Zealand case provides an excellent example of a national government that has been using

performance-based planning, operations, and maintenance for many years and has now integrated

asset management into this mix. The investment

program of Transit NZ (and of other agencies as

well, such as the Land Transport NZ’s financing

decisions) is tied very closely to the government’s

policies and mandates. These agencies use performance measures to assure consistency in agency

action at all levels of decisionmaking. This occurs

not only at the strategic level, but also in the contracts used to provide maintenance services. This

hierarchy allows a buildup of information from the

most local level to a national perspective on the

progress being made. New Zealand transportation

officials have thought carefully about where asset

management fits into the total business activities of

their organization, not just the obvious ones of

maintenance and preservation. The linkage between

asset management and Transit NZ’s environmental

plan is an example of this, even though it is in its

infancy.

One does not need to outsource service delivery 

to have a strong asset management program.

However, the New Zealand case does suggest that

28 | CHAPTER 2

Component Basis for calculating replacement cost

Land Valued at the same price per hectare as the 

surrounding land.

Formation

Unit rate obtained from contract records of highway

construction (1–10 km lengths), and grouped in terms

of terrain and width.

Pavement

Depth of sub-base and basecourse, and surfacing type

determined from State Highway Pavement Design

and Rehabilitation Manual requirements. Unit rates

from contracts in the region.

NOTE: From now on, pavements will be designed 

in accordance with the Austroads Pavement 

Design Guide.

Drainage Unit rates from RAMM unit cost tables or better, from

recent contracts. Traffic

Facilities

Bridges Unit rates from RAMM unit cost tables or better, from

recent contracts.

Culverts/

Subways

Unit costs derived from Opus International

Consultants database, dependent on cross-sectional

area, and multiplied by length to give 

replacement cost.

Other

Structures

Unit rates obtained from updated contracts in the

region, if possible. Structures > $50,000 are identified

and valued as individual structures.Those < $50,000

can be valued on a parameter basis (e.g., $/km).

Table 5. Calculation of replacement cost.
the opposite is true.

Outsourcing service delivery

requires a strong asset management program. Such a

program provides some

assurance that the agency is

doing the right things, and

that through performance

monitoring, progress toward

overall goals can be determined. One consequence of

outsourcing for Transit NZ

was a reduction in the number of staff. However, staff

levels have increased because

of the need to monitor the

contracted service and provide strategic direction. Not

only have the number of staff

gone up, the skill set has

changed for these new staff

members. 

The Land Transport NZ

approach to budget 

allocation provides an 

interesting example of tradeoff analysis among different

budget categories at a general level. Land Transport NZ

provides applicants very

detailed instructions on the

information required for their

proposals, with common

measures across different

asset types. Priorities are set

by how well a project makes

its case for national funding.

For capital projects, this 

usually entails a benefit-cost

analysis. For maintenance

projects, this requires a

stronger linkage to systematic and comprehensive 

examinations of the problems

focused on (e.g., linking a request to the asset 

management plan).

Because of legislation and regulation, asset management

plans are required for agencies seeking funding from the

national government, including Transit NZ. These asset 

management plans provide a strategic perspective of the

problems, the types of strategies appropriate for different

types of problems, and a process for determining the best

mix of strategies. The concepts embedded in these plans are

also incorporated into regional network plans, resulting in

consistency across the country. The network management

plans reviewed for this case (and these were small areas

compared to typical U.S. jurisdictions) were more comprehensive than found in most U.S. jurisdictions. They were 

succinct, targeted, and focused on system performance.

TRANSPORTATION ASSET MANAGEMENT | 29

Words of Wisdom and Experience

Based on many years’ experience with performance-based decisionmaking 

and asset management,Transit New Zealand officials offered many 

observations of benefit to others:

“Asset management focuses organizational attention on what you are doing.”

“The ability to have data and manipulate it at an area network level does

change behavior and outcomes. ...(But) choosing performance measures 

that are both meaningful and relevant without inducing perverse 

behaviors is an art.”

“Data collection is critical to successful asset management, but too much 

inaccurate, unfriendly data is worse than having none at all.”

“Start off with basic performance measures and get them engrained before 

looking to refine and expand them.”

“The ability to demonstrate that infrastructure is being preserved and to 

demonstrate the consequences of not investing in asset management 

are critical in today’s environment.”

“The only way to survive in the future is to protect that which we already have.”

“We are not dealing with rocket science....All we need is a vision of what we

want to achieve, and we will achieve it.”

“Good asset management is having the right people, fostering the right 

relationships among these people, and supporting their activities 

with strong information systems.”

“Balancing the auditing activities and actually doing something is rather 

complex....We want to be proactive, not reactive.”

“Asset management is understanding what our customers want, defining ways

of measuring our delivery to these expectations, identifying means of improving

system performance, and then continually monitoring to see how we are 

achieving customer expectations in our job.”

“This [asset management] is not a ‘stop-building-nasty-roads’ campaign, it is 

‘let’s get value from what we are doing.’ ”

“The key challenge is to tell the story of asset management.”
30 | CHAPTER 2

Information systems serve as the decision support foundation for asset management. These systems, in turn, depend

on the quality and efficiency of the databases that support

them. Over time, Transit NZ has developed a set of good

asset management systems (although the structures are

behind pavements) that are now linked via a locational 

referencing system. With a common reference base, Transit

NZ can obtain much more useful information while using

existing databases.

Transit NZ has applied innovative methods to obtain public

input into its asset stewardship role. Focus groups have been

used to identify perceptions and desires of the community on

asset management, and targeted outreach efforts have been

used to solicit user input. A good example of this latter effort

was the trucker input on ride quality. 

Finally, New Zealand has one of the most comprehensive and

institutionally supported asset management user groups in the

world. The National Asset Management Steering (NAMS)

Group is a support structure for asset management that plays

an important educational and training role in New Zealand. It

has developed several how-to manuals that have become

important resources worldwide. Chapter 5 has more 

information on NAMS.
TRANSPORTATION ASSET MANAGEMENT | 31

Four of the sites the scan team visited

represented asset management experience at the state or

provincial government level. In the case of both countries visited, the federal government is not a major player in asset management, providing much less funding than the United States

for transportation infrastructure. In Australia, for example, the

federal government is proposing to remove itself even more

from funding transportation systems. Thus, the states and

provinces visited had a great deal of autonomy in developing

asset management programs in ways that met their own

needs. The four state/provincial government experiences with

asset management included those for Alberta (Canada), and

New South Wales, Queensland, and Victoria (Australia).

ALBERTA, CANADA

Alberta Infrastructure and Transportation (AIT)—

www.inftra.gov.ab.ca

Context

With just under 3 million people, Alberta is one of the wealthiest provinces in Canada, primarily because of its vast reserves

of natural resources. Approximately the size of Texas, Alberta

has a large road network that, because of wide temperature

fluctuations and significant heavy truck use, experiences substantial preservation and maintenance needs. Critical transportation issues identified by Alberta transportation officials

include 1) an aging existing infrastructure, 2) demands for

new corridors (e.g., ring roads) around major cities, 3) a new

fiscal framework on public-private partnerships, and 4)

increasing competition for resources from other government

ministries and for other types of infrastructure.

With an annual budget of just over Can$4 billion (US$3.2 billion), Alberta Infrastructure and Transportation (AIT) is responsible for overseeing not only the road network, but also other

major types of infrastructure in the province. Partly because of

this multiple responsibility, the scan team was particularly

interested in seeing how the province established priorities

among different asset categories. In addition, AIT’s reputation

for conducting state-of-the-art asset management provided

an important motivation for this scanning study, a reputation

supported by the team’s observations. 

Chapter 3:

State/Provincial Experience

with Asset Management

Drivers for Asset

Management

Several factors have influenced AIT’s development 

of a comprehensive asset

management program.

Perhaps most important were

economic worries in the late

1980s and early 1990s that

put pressure on the government to downsize and

become more efficient. By the

mid-1990s, this led AIT to

outsource much of its maintenance and capital renewal

activity (planning, design,

construction supervision, and

maintenance operations) to private companies. This resulted 

in an AIT staff reduction from about 2,500 to less than 800

employees. With such a structure for program delivery, however, AIT officials realized that a process for systematically identifying deficiencies and allocating resources was an important

part of its asset stewardship responsibilities. An asset management program was viewed as serving this function. In fact,

AIT officials credit the agency’s infrastructure management

systems with establishing a credible maintenance backlog

estimate of Can$3.3 billion (US$2.6 billion) that was accepted

by government officials as the “real” infrastructure need in the

province. The desire for an effective asset management 

program also occurred about the same time as AIT’s 

pavement and bridge legacy management systems needed 

to be upgraded. 

The evolution of government policy toward infrastructure has

also had an important influence on the evolution of asset management practice in AIT. In the late 1990s, a policy of encouraging more coordinated capital planning was adopted, which

in 1999 was incorporated into the government’s business plan.

In 2002, the government adopted a policy on alternative capital

delivery mechanisms, which included encouraging public-private partnerships as a means of providing more infrastructure.

Eliminating the maintenance backlog, which at the time was

about Can$1 billion (US$800 million), became a priority. 

Infrastructure

Managed

 26,200 km (16,281 mi) of paved

road/4,600 km (2,858 mi) of

gravel road

 3,870 bridges

 150 major water management

facilities

 510 km (317 mi) of main 

irrigation canals

 1,860 government-owned 

buildings

 310 leased buildings

ALBERTA

(CANADA)

NEW SOUTH

WALES

QUEENSLAND

VICTORIA

(AUSTRALIA)
In 2003, the first 3-year capital program under this new fiscal

management structure was adopted, which was supported by

a 5-year capital plan, a 10-year strategic plan, and a 25-year

futures plan. Asset management was a critical theme in all of

the plans; indeed, the decision support structure provided by

AIT’s information systems was critical in the development of

many of the strategies.

Although not exactly a driver for asset management, one reason AIT has been able to show such progress in its asset

management program is the continuity in top leadership. The

same political party has been in power since 1971, and government ministers responsible for AIT have had long tenures.

This continuity in leadership, along with a policy of adopting

business practices for governmental operations, has led to

asset management techniques becoming part of the strategic

management of the agency. 

This combination of seeking greater financial efficiency in program delivery, providing oversight for outsourced functions,

and the need to update its legacy systems led AIT to develop

a comprehensive asset management system called the

Transportation Infrastructure Management System (TIMS).

Organization for Asset Management

The asset management function in AIT is evolving. A small

section in headquarters, the highway asset management section, deals primarily with high-level performance measure

development, target setting, and reporting, and provides data

for other areas. Program development is done by another

group, which coordinates input from regional infrastructure

managers. The development of AIT’s infrastructure management information system is the responsibility of another

group. There are about seven staff members in the highway

asset management section, 12 in program development and

delivery, and nine regional infrastructure managers and engineers (in four regions).

As noted earlier, AIT outsources much of its activities, including maintenance functions. These contracts define the types

of work activities that are to occur via contract activities and

establish desired outcomes of such contracts, but AIT does

not specify how to produce these outcomes.

Decisionmaking Approach

One of the important distinctions between the Canadian and

U.S. transportation systems is that highway projects in the

provinces are funded almost entirely by the provincial government. Therefore, highway budgets compete with other infrastructure (e.g., schools and hospitals) as well as other budgetary priorities. 

In 1997, the provincial government recommended that a more

coordinated capital planning process be put in place to determine the best investment among competing demands. A

Capital Planning Initiative (CPI) was included in the 1999 government business plan to “ensure effective and innovative

capital planning and funding of government-owned and supported infrastructure.” Thirteen governmental ministries participate on a CPI committee, chaired by the deputy minister for

infrastructure and transportation. Two of the first goals of this

initiative were to develop a provincial strategy for alternative

capital project delivery (e.g., public-private partnerships) and

to eliminate the maintenance backlog on the province’s infrastructure. CPI also monitors trends on common (cross-asset

types) performance measures, uses infrastructure management systems to determine the status and predicted performance of the province’s infrastructure, reports on the ministries’

statements of intent as their actions relate to performance

measures, and identifies cross-government capital needs and

priorities. The management systems include one for transportation (see below), but also systems for buildings and

lands, water management, collections and exhibits, and

municipal infrastructure.

The ministries submit a 10-year capital requirements plan and

identify 3- and 5-year capital plan alternatives. These alternatives reflect ongoing preservation requirements, plans to eliminate maintenance backlogs, and major new capital priorities

and other capital needs. Tradeoffs are determined among different asset investments based on criteria that relate to a ministry’s ability to deliver the program, expected performance,

economic benefits, cost avoidance, cost effectiveness, and

strategic alignment with the government’s priorities. Flexibility

exists to move funds from one infrastructure category to

another. An AIT official noted that the existence of a credible

infrastructure management system has allowed AIT to “fight

the fight” for increased transport funding. 

Performance Measures

Performance measures are used by political leaders at the

business plan level, by senior department executives to justify

budgets, and by operations staff to identify potential work

activities. Three categories of infrastructure performance are

used for all asset types (including those outside the transportation sector) to measure current and future performance.

These performance measures relate to condition, use, and

functional adequacy. For condition, AIT rates pavement rough32 | CHAPTER 3

“Transportation infrastructure is not an expenditure;

transportation infrastructure is an investment.”

—AIT OFFICIAL
ness as good, fair, or poor using the International Roughness

Index (IRI) averaged over 1-km sections. The condition measure is differentiated by road type: roads with speeds greater

than 110 kilometers per hour (km/h) (68 miles per hour

(mi/h)) or less than 110 km/h. “Poor” is defined as 1.9 m/km

for 110 km/h roads, and 2.1 m/km for less than 110 km/h

roads. Use is measured as the percent of road kilometers at

service level C or better. Functional adequacy is determined as

the percentage of kilometers that meet width standards, horizontal alignment standards, and appropriate road surface type

for traffic volume levels, and that have no weight restrictions. 

AIT has no difficulty reporting those sections of its highway

network in poor condition. An AIT official noted that actually

reporting on poor road sections represents a change in

agency philosophy because 10 years ago this condition level

would have been downplayed. Now, it is used to justify funding requests.

The 2005-2008 Business Plan for Alberta Transportation identified several performance measures considered important in

achieving progress in the agency’s core business areas. The

asset management-related measures included the following:19

Asset Management Information Systems

AIT began developing its transportation infrastructure management system (TIMS) in 1996. By 2006, TIMS will consist of

a suite of 20 software applications that cover such highway

assets as bridges, roads, culverts, signs, signals, and other

associated structures and appurtenances. TIMS is expected to

integrate the different databases, allowing AIT to optimize

program delivery. AIT officials estimate that even if only 20

percent of AIT staff use the finished system, it will have paid

for itself. When done, TIMS will cover about one-third of all

the province’s assets. AIT officials noted the following system

benefits:

 Enables gaining best life-long returns on investments

 Documents the rationale for investment decisions

 Provides the tools to achieve excellence in all phases of

asset creation and maintenance

 Enables preservation and optimum use of knowledge assets

such as data, information, and human capital

 Provides an effective and efficient learning tool

The data included in TIMS are referenced to a common

datum; highway attribute data are referenced to a common

network. Data are collected using geographic coordinates and

reported using linear referencing. The

provincial highway system, municipal road

network, and bridges are included in the

TIMS databases. Every AIT employee with

access to a computer can use TIMS for a

variety of purposes, including appurtenance inventory, bridge condition information, network expansion projects, a

routing and permitting system, performance measurement, and quality assurance

of data collection. 

TIMS consists of several core 

components (see figure 13 on next 

page), including the following:

Network Expansion Support System

(NESS)—NESS is a decision support

system that uses expert opinion and

objective information to define current

and future conditions of the road network. It acts as an expert system by

identifying work activities necessary to

TRANSPORTATION ASSET MANAGEMENT | 33

“You can’t do anything without performance measures.”

—AIT OFFICIAL

Performance Measure Last Actual Target Target Target

2003-04 2005-06 2006-07 2007-08

Physical condition of highways

% in good condition 65.5 62.0 58.5 56.0

% in fair condition 23.3 24.0 25.0 25.5

% in poor condition 11.2 14.0 16.5 18.5

Use of provincial highways

% highways that accommodate 99.9 99.0 99.0 99.0

current volumes at required LOS

Functional adequacy of highways

% of highways not subject to 80.1 79.8 79.7 79.6

weight restrictions and meeting 

current engineering standards

Provincial highway paving

remaining kilometers of graveled 630 560 500 430

provincial highways to be paved

Construction progress on NorthSouth Trade Corridor

% of four-lane road open to traffic 82.0 84.0 89.0 90.0

Ring roads in Edmonton and Calgary

% of ring roads open to traffic 18.2 18.2 26.5 40.0

19 Alberta Infrastructure and Transportation, Business Plan, 2005-2008, April 13, 2005, see http://www.finance.gov.ab.ca/publications/budget/

budget2005/inftra.html#7
deal with identified problems. Each highway section is rated

from a technical (level of service and geometrics), safety

(collision rates), and socioeconomic policy perspective. 

The degree to which each of the first two criteria deviate

from the norm for the type of road being investigated is

used to assess the level of problem experienced at that

location. Different types of work activities—data collection,

engineering analysis, and rehabilitation/capital 

improvement—are assigned to each section of road where

problems exist or are likely to exist in the future. 

Figure 14 shows the concept of how different technical,

safety, or socioeconomic factors can identify a section of

roadway as a candidate for improvement. The horizontal

bars represent locations along a highway where these 

factors need to be addressed, and the cumulative bar at 

the bottom suggests where multiple work activities need to

occur along this stretch of road.

Bridge Expert Analysis and Decision Support (BEADS)

System—This prototype system examines different bridge

strategies, combined over the entire bridge network, 

to facilitate short-term programming (3 to 5 years), 

analyze long-range budget scenarios (longer than 5 years), 

evaluate status of the bridge network, and assess impact 

of policy decisions. 

BEADS consists of three modules: 

condition, function, and a strategy builder.

The condition-related measures reflect

the condition of the superstructure, paint,

and culverts (see figure 15). The functionrelated measures reflect width, strength or

load capacity, vertical clearance, and existence of bridge rail. Both modules include

triggers that relate to work activities

required at specific times in the life cycle

of the bridge. Deterioration models are

incorporated into the module aimed at a

65-year deterioration range. Interestingly,

the function module also calculates the

user costs associated with not completing

possible work actions. 

The strategy builder module is the most

important module in BEADS. This module

assembles life cycle strategies based on

input from each module, and compares a

large number of strategies on a life cycle

economic basis. Two base strategies—“do

nothing then replace” and “do nothing

then close”—are considered for each

bridge. Up to 13 additional base strategies

can be developed, each assuming

replacement in a future 5-year increment

from the previous base strategy (e.g.,

replace in year 10, replace in year 15,

etc.). The module uses a least-cost net

present value (NPV) action plan from the

condition modules, and keeps track of the

cost of actions up to the replacement year

and the user costs for functional deficiencies. The results of the strategy builder

module include a list of ranked strategies

for each bridge structure, a recommendation of a least- cost NPV strategy, a point

34 | CHAPTER 3

Figure 13. Core work processes in TIMS in Alberta.

Figure 14. Buildup of candidate improvement road sections in Alberta.
of departure for an expert

review by bridge staff, and

a statement of need for

additional inspection,

assessment, and review of

the bridge structure.

Highway Pavement

Management

Application (HPMA)—

This management system

is similar to those used in

the United States. It consists of an inventory of

pavement assets, including pavement condition

(current and historical

data), an estimate of 

current and future network deficiencies and

needs, the selection of maintenance and rehabilitation

treatments, an economic assessment, and the selection 

of an optimal program of investment. HPMA provides 

visual representation of layer thickness, width, and material

for both longitudinal and lateral sections on a roadway, and

a record of the maintenance and rehabilitation activity 

on the pavement. It also represents visually the pavement

surface type, International Roughness Index (IRI), distress

index (SDI), structural adequacy index (SAI—deflection), 

and traffic data. Triggers are used in the IRI, SDI, and 

pavement quality index (PQI) measures to recommend

short-term treatments, whereas prediction models are 

used to determine performance trends. Decision trees are

used to select maintenance and rehabilitation treatments

based on current and future conditions. The HPMA also

allows the user to define a 5-, 10- and 20-year investment

program, either to maintain certain condition levels or 

to meet budget constraints. 

Data Collection

Data collected by AIT support the TIMS system and 

appurtenance inventory, are used in mapmaking, provide

input into highway surface and geometric design, identify

crash characteristics, feed into performance measurement,

and support truck routing and permitting. Transverse 

paved-surface characteristics, vertical and horizontal 

geometry, line painting location and type, and location 

of appurtenances are obtained from video log data. AIT 

has embarked on a 3-year project (2002 to 2005) to collect

base data on the provincial highway system on all driving

lanes in each direction, which will be maintained over 

time with a slightly reduced coverage (e.g., IRI/rut collected

in the driving lane in one direction, digital video logs 

made in only the driving lane in both directions, and new

data collected only on roads that have significantly 

changed status). 

The data-collection program for IRI and rut data has been

given to a private contractor, with strong management guidance from AIT. According to AIT officials, the key factor for

success of this data-collection model has been applying quality assurance (Q/A) protocols. Ten Q/A sites were established

jointly by AIT and the data-collection vendor: two IRI/rut calibration sites, traversed at the start and end of the collection

season; six 500-m IRI/rut/geometric verification sites; and two

1,000-m IRI/rut/geometric verification sites. Twenty global

positioning system (GPS) blind sites were established at locations unknown to the vendor. AIT used these blind sites to

assess the quality of the data collection after delivery. For IRI

accuracy, known sites had to be traversed once every 3,000

km/7 days (1,864 mi/7 days) and results submitted to AIT

immediately for approval. The GPS location measured at these

sites had to be within 2.00 m (2 yd) in the x, y directions and

1.75 m (1.9 yd) in the z direction 90 percent of the time. The

IRI/rut values had to be within 10 percent of the actual IRI

values plus 3 millimeters (mm) (0.12 inch (in)) for ruts of

known values. The Q/A of video logs was related to established criteria for acceptance (e.g., bug splats, rain, and sun

angle), with video data delivered every 30 days for review.

Appurtenances are spot checked against ground truth locations where data has already been collected.

The various types of data have different schedules. For example, the IRI and rut data are collected annually on the entire

network. Surface distress data, collected by AIT staff, are 

collected on a cyclical basis with 50 percent of the network

TRANSPORTATION ASSET MANAGEMENT | 35

Figure 15. BEADS components in Alberta.
collected each year. The schedule for bridge inspection data

depends on different classifications of highway. All bridge

inspections are also outsourced. Data entry is done by the

data collectors and verified by department staff. The cycles

defined for Level 1 (or routine) inspections are based on

structure type and roadway type, and include the following:

 Major bridges, standard bridges, and culverts on primary

(2-digit) highways—every 21 months

 Major bridges, standard bridges, and culverts on secondary

(3-digit) highways—every 39 months

 Major bridges on local roads—every 39 months

 Standard bridges and culverts on local roads—

every 57 months.

Level 2 (or condition) inspections require specialized 

equipment or expertise and are determined as a result 

of information from Level 1 inspections. 

The department’s estimated annual costs for data collection

include the following:

 IRI/Rut—Can$550,000 (US$441,000)

 FWD (strength data)—Can$450,000 (US$361,000)

 Surface distress data—Can$200,000 (US$160,000)

 Bridge inspections—Can$600,000 (US$481,000)

 Digital videos—Can$400,000 (US$321,000) every 3 years,

with an annual update of Can$80,000 (US$64,000) for the

remaining 2 years. 

These costs total Can$26 per lane-kilometer (US$33.50 per

lane-mile) with video and Can$19 per lane-kilometer

(US$24.50 per lane-mile) without video.

Analysis Procedures and Prioritization

AIT uses scenario analysis to examine the implications of 

different investment strategies on the performance of the

highway network. Typical scenarios include the following:

What level of funding is necessary to maintain current 

performance? What happens if current budget levels are

applied in future years? What happens with different 

investment budgets? To determine future road performance 

at the network level, it is assumed that the network 

deteriorates at a 5 percent per annum rate. AIT’s 

business plan is based on this analysis.

Life cycle cost analysis is used throughout the asset management program. For individual projects, pavement life span is

determined as the time it takes pavement quality as measured

by the Pavement Quality Index (PQI) curve to reach a trigger

level (e.g., PQI = 6.5 on a 0-to-10 scale). The life cycle will typically include two or three of these life spans, corresponding

to an analysis period of 50 years. Remaining service life is not

calculated as part of the assessment. Bridge engineering uses

a 50-year life with a 4 percent rate of return for life cycle

analysis. As part of the life cycle analysis for bridges, a

remaining service life is calculated and modified by condition

data obtained from inspections.

Although AIT does not now use benefit-cost analyses to

establish project priorities in program development, it is 

developing such an optimization module for TIMS. AIT officials now use a ranking system based on condition data and

other factors as a guide in program development. The output

from this ranking system is reviewed and adjusted by regional

infrastructure staff.

The development and use of a cross-asset comparison and

prioritization scheme was an interesting aspect of the Alberta

case. The CPI committee set up a task group to identify a

process for prioritizing among different asset types with a

focus on capital projects. The resulting rating system assigns

points to projects to the extent they help achieve government

policies and meet program delivery criteria relating to condition, use, and functionality. A project can receive a maximum

score of 100 points. Departments are responsible for 

prescreening projects before they are rated to confirm 1) the

project’s need, scope, and cost; 2) the proponent’s ability to

implement the project; and 3) that the project is a high priority

for the agency. According to the prioritization guidelines, the

points are assigned in the following way:20

PROGRAM DELIVERY AND HEALTH AND SAFETY—

UP TO 76 POINTS

This category assesses condition, utilization, and functionality

restraints on program delivery outputs according to optimal

and basic program delivery standards established by departments. It considers how seriously these standards will be

compromised if the project does not proceed. 

The rating system assumes all government programs (schools,

hospitals, museums, etc.) are of equal priority and gives equal

weight to all programs. Program Delivery is rated according to

the intrinsic requirements of each program. Up to 72 points.

Where projects address health and safety hazards caused by

the infrastructure itself, the system provides for increased

points under the Health and Safety category. Up to 4 

additional points.

ECONOMIC FACTORS—UP TO 24 POINTS

Three factors provide additional points based on economic

36 | CHAPTER 3

20 Capital Planning Initiative, 2003-2003, Government of Alberta, http://www.trans.gov.ab.ca/Content/docType52/Production/

CPI%20Final%20Report%202002-03.pdf
considerations, representing 24 percent of the maximum

potential rating score.

 The Economic Benefit Factor is based on four key objectives of

the Province’s economic strategy. Up to 12 additional points.

 The Cost Avoidance and Savings factor awards points to

projects that will result in future savings to the province or

provincially funded agencies based on program delivery or

facility operation and maintenance costs that will be saved

if the project is implemented. Up to 8 additional points.

 The Value and Cost Effectiveness factor awards points where

the capital cost funding commitment is less than indicated by

provincial guidelines, usually because of funding from others

(public-private partnership arrangements, fund raising, other

governments, etc.). Up to 4 additional points.

MAXIMUM SCORE: 100 POINTS

Observations

AIT has made a major commitment to asset management as

part of its business plan and as a key component of its role as

a road manager. AIT was the only state-level agency the scan

team visited where officials were responsible for more than

road assets. Thus, the way tradeoffs occur among asset categories was an interesting aspect of this case.

Several important characteristics of the asset management

approach at AIT stand out. It is very clear that high-level managers have bought into the asset management approach to

network stewardship. In many ways, the entire organization

has been reinvented to incorporate a different business and

decisionmaking culture. Asset management is viewed as an

important means of determining the best business decision

for a large portion of the agency’s budget. AIT’s credibility

with other agencies, the public, and, perhaps most importantly, the elected government is strongly tied to having a defensible and understandable technical foundation underlying its

recommendations. 

Another aspect of asset management in terms of the buy-in

was the need for such a strategic perspective in an environment where much of the service delivery is outsourced. AIT

has learned that outsourcing such services requires a more

active role by the asset owner to make sure the right things

are being done.

AIT is developing a state-of-the-art infrastructure management

system. The many different modules and their roles in supporting agency decisionmaking were impressive. Once this system

is completed, it could very well be at the leading edge of decision-support systems at state-level transportation departments.

The use of a locational referencing system to tie databases

together is also a useful model for other agencies. The BEADS

and NESS functionalities were particularly impressive. 

The use of TIMS to build up work activities (see figure 13) is a

very important and useful capability. Once this entire system is

in place and functioning, TIMS will likely become a critical

tool for AIT in responding to asset deficiencies quickly and

efficiently.

For cross-asset category comparisons, the use of similar performance measures—condition, use, and functionality—across

infrastructure groups allows AIT officials to develop a bestvalue investment package. The scoring scheme developed for

the CPI process is an innovative attempt to examine crossasset prioritization. Although models and analytical procedures to provide a dollar-for-dollar comparison across these

asset categories do not appear to be in place, tradeoffs are

likely to occur and information from systems like TIMS can be

critical in supporting the transportation asset portion of this

comparison. 

One of AIT’s goals is to become a center of excellence for

transportation in North America. At least in the asset management arena, it appears to be well positioned to become

exactly that.

NEW SOUTH WALES,AUSTRALIA

Roads and Traffic Authority (RTA)—

www.rta.nsw.gov.au

Context

With more than 189,000 lane-kilometers of sealed road, New

South Wales (NSW) has one of the most extensive road networks in Australia. The Roads and Traffic Authority (RTA) of

New South Wales is the agency responsible for the major

roads and bridges on this network. RTA’s stated vision for its

stewardship of this network is to assure “value for money” in

its investment decisions, and to provide effective governance

and risk management in partnership with industry and the

state’s communities. 

According to RTA officials, the major challenges facing the

transportation system include 1) major exponential growth

in freight demand, 2) relatively flat growth in public transit

use, 3) major exponential growth in private passenger

demand, 4) increasing demands by utilities to use road 

corridors, 5) increased community expectations on safety

and environmental quality, and 6) increasing roles for

defense and security uses of the road, airport, and port 

systems. There has also been a trend toward bigger and

heavier trucks being permitted on the road network, which

has had design, safety, and operational consequences. From

the asset management perspective, a 40 percent increase in

truck mass limits since the 1960s has severely stressed an

TRANSPORTATION ASSET MANAGEMENT | 37
arterial and local road

network built to the standards of the 1950s and

1960s.

New South Wales has 166

local government councils,

and RTA has a road grant

program of about A$150

million per year to help

these councils improve

their regional road network. New South Wales

will also cover 50 percent

of the cost of improvements to timber bridges. 

Similar to other Australian

states, New South Wales

has been using publicprivate partnerships to

build some major new

projects, and has contracted out a portion of its road

maintenance activities to

private contractors (two to

three contractors). In both

cases, the provision of

asset management 

strategies is incorporated

into the concession 

deeds or contracts.

Drivers for Asset Management

The RTA definition of asset management borrows from many

other definitions offered by organizations in Europe, the

United States, Australia, and New Zealand:

 Consists of a broad, integrated systems approach to

respond to customer-level-of- service needs to maintain,

upgrade, and operate physical assets cost effectively

 Competes with other portfolios for scarce public funds 

(e.g., health and education)

 Relies on economic analysis and deterioration models

The New South Wales Department of Treasury is a major 

driver for RTA’s approach to asset management. The department has adopted a policy with a stated objective of “managing infrastructure as a long term renewable asset and to use

an integrated package of recurring maintenance with capital

renewal to achieve modern standards without increasing

functional capacity.”21 Capacity increases are funded under a

separate program. The Treasury expects each agency to adopt

its own policy consistent with the Treasury’s. It depends on

RTA “to manage risks of technological redundancy and to

separate expansion of effort from maintenance of effort.” 

The Treasury’s policy is intended to address “past bias

towards acquisition of new capital assets at the expense

of appropriate asset maintenance.”

Of the sites the team visited during this scan, the NSW

Treasury was one of the most active in encouraging asset

management practice. The Treasury’s directions for asset

management in government agencies require the following:22

 Develop an asset portfolio to support and demonstrate

service delivery.

 Set priorities for the assets to be managed.

 Develop a gap analysis between existing and required

assets.

 Identify asset-related risks that affect delivered services.

 Identify asset performance levels required to achieve service

performance established in a Results and Services Plan

(RSP).

 Address risk and compliance with mandatory requirements

or asset standards.

 Define the relationships between the RSP and Corporate

Plan.

 Provide information for capital investment, asset maintenance, and asset disposal. 

In addition to the Treasury directives, RTA officials identified

other reasons for greater emphasis on asset management in

the agency. The government’s transport minister and the community at large expect RTA to provide the most cost-effective

service possible. Asset management helps RTA do this. In

addition, asset management enhances RTA’s relationship with

other agencies, such as the Department of Infrastructure,

Planning, and Natural Resources and the Treasury. It helps

RTA compete for funds with other agencies at the state and

federal levels, and provides greater scrutiny and accountability

for program and project management. Finally, asset manage38 | CHAPTER 3

“With respect to asset valuation, we tell the accountants that we will

follow your rules, but we will not let them drive investment.”

—RTA OFFICIAL

21 See http://www.treasury.nsw.gov.au/pubs/tpp2004/tpp04-3.pdf. 22 New South Wales, Total Asset Management Template, Report TAM04-06, Sydney, NSW, Sept. 2004. http://www.treasury.nsw.gov.au/tam/pdf/

tam_template.pdf.

Infrastructure

Managed

By RTA

 4,800 bridges

 37 tunnels

 3,300 signals

 42,000 lane-kilometers (26,098 

lane-miles) of arterial pavement

 750 lane-kilometers (466 lane-miles)

of unsealed road 

 200 million m2 (239 million yd2) 

of surface

 9 vehicular ferries

By local government, 

regional roads

 13,600 km (8,451 mi) sealed roads

 4,800 km (2,983 mi) unsealed roads

 1,500 nontimber bridges

 323 timber bridges

By local government, local roads

 20,000 km (18,642 mi) urban 

sealed roads

 40,000 km (18,642 mi) nonurban

sealed roads

 82,000 km (50,954 mi) nonurban

unsealed roads

 7,600 bridges, including 2,600 timber
TRANSPORTATION ASSET MANAGEMENT | 39

“We are not separate from the political process; we are part of government. Thus, our

role in asset management is to inform this process and influence it.”

—RTA OFFICIAL

ment allows RTA to provide better workforce planning, an

important challenge with its aging workforce. RTA has had

very stable political leadership, with the most recent minister

staying for 8.5 years. This has allowed RTA to develop a strong

base of support for asset management among government

leaders.

Organization for Asset Management

At the state level, a Cabinet Standing Committee on

Infrastructure and Planning reviews and endorses major 

infrastructure proposals and asset strategies for roads, transport, energy and utilities, education, health, and housing. 

This committee must approve proposals before they can 

be considered by the Cabinet’s Budget Committee and 

subsequently included in an agency’s capital plans.

Within RTA, the Directorate of Road Network Infrastructure is

responsible for network development and maintenance,

spending about 70 percent of RTA’s budget. The Infrastructure

Maintenance Branch in this directorate was responsible for

preparing RTA’s Infrastructure Maintenance Plan, a plan credited with convincing politicians to allocate more funding to

asset preservation. Other directorates, especially the Traffic

and Transport Directorate and the Motorways Directorate, also

share responsibility for asset management of the road infrastructure. This organizational structure has been endorsed by

the Treasury and has been instrumental in securing increased

funding for asset maintenance. For example, after RTA highlighted road infrastructure needs through this structure, the

government agreed that revenue from recent increases in

Sydney Harbour Bridge tolls and other road-user charges will

be dedicated to maintenance work in Sydney and other parts

of New South Wales.

Decisionmaking Approach

RTA’s investment decisionmaking and corporate resource allocation processes focus on two major types of projects, whose

definition has been agreed to by the Treasury. 

1. Infrastructure asset management entails “customer

works and services to ensure route assets are available for

reliable operation and performance of their existing functionality and are in compliance with current legislative,

regulatory and community safety and environmental standards. The ‘existing functionality’ of route assets is defined

as projects and services to ensure routes are open for

travel under all ‘non-disaster’ weather conditions by all

general access vehicles together with restricted access

vehicles permitted on that route, at speeds up to the designated speed environment for that route without widespread speed limits imposed for safety purposes.”

2. Network development entails “customer works and services that expand the functionality of routes to improve congestion, provide reliable and predictable travel conditions,

support land use development, and enable travel by vehicles other than General Access and those Restricted

Access Vehicles already permitted on that route.” 

RTA’s definition of asset management excludes network

development, but does allow the upgrading of bridges and

pavements through rehabilitation or reconstruction. 

Every NSW agency is required to have a strategic plan that

explains how the agency intends to use its service delivery,

back office, and funding/asset strategies to achieve its desired

service delivery results. The plan typically contains the

agency’s vision, mission and values. A service delivery strategy

identifies and prioritizes the agency’s clients and their key

service delivery requirements over the next 3 to 5 years. The

strategy describes how the mix of services provided by the

agency will lead to achievement of the agency’s desired

results.

The Treasury requires each agency to also have a Results 

and Services Plan (RSP) that provides information on 

the following: 

 Services an agency provides

 Results an agency is trying to achieve for the community

 Result indicators and service measures

 Emerging and strategic issues that may have an impact 

on service delivery or results

 Major risks that may prevent a service from being 

delivered as planned

 Risk-management strategies

 Major strategies or initiatives necessary to ensure organizational capability to deliver services and achieve results

 How strategic issues will be managed

 How performance will be reported

In some cases, the RSP could be satisfied by an agency’s

Statement of Intent. Figure 16 (see next page) shows the

alignment among the Corporate (or strategic) Plan, the

Results and Services Plan, and the Asset Strategy. Figure 17

(see page 41) shows the flow of decisionmaking and information in support of RTA’s asset management program. 

Performance Measures

RTA has used network performance measures for many years

as part of its system stewardship and governmental accounta-
bility responsibilities. Performance measures are found in 

several different categories, primarily relating to customer 

outcomes, achievement of customer needs, and 

delivery of government commitments. Each performance

measure has specific characteristics associated with it, 

including management accountability,

coverage and scope, reporting 

frequency, reporting level, information

source, and benchmarking suitability. 

For asset management, the performance measures used most often

include those relating to community

satisfaction, safety, asset retained

value, age of pavement and structures, and network reliability. The

asset management-related performance measure reported in the latest

RTA annual report was ride quality

and pavement durability (along with

fatalities and traffic speeds/volumes

for seven routes to and from

Sydney). Figure 18 (see page 42)

illustrates some of the measures 

RTA officials use to monitor network

performance.

The NSW Treasury identified several

key factors for performance indicators

in its maintenance strategy guidance

to other agencies. They are repeated

below because they provide a good

checklist for developing a performance-based asset management 

program.23

 Indicators should focus on outcomes achieved rather than action

taken.

 Consistency in definitions and

methods of measurement is essential to ensure results can be analyzed and compared over time.

 Simplicity should be as highly valued as reliability. Complex

approaches are expensive and

often need a high level of expertise.

 Rarely do numbers alone tell the

story. Qualitative information on

performance is equally useful.

 Indicators should be explicit in

their format and expressed as a percentage, ratio, or some

other numerical format.

 The number of indicators used at any management

level should be limited to a maximum of about seven.

40 | CHAPTER 3

Figure 16. Alignment among Corporate Plan, Results/Services Plan, and Asset

Strategy at the Roads and Traffic Authority.

23 NSW Treasury, Asset Maintenance Strategic Planning, Report TAM 04-3, Sydney, NSW, Sept. 2004, See, http://www.treasury.nsw.gov.au/tam/pdf/

asset_maintenance.pdf.
TRANSPORTATION ASSET MANAGEMENT | 41

Larger numbers of indicators tend to lose relevance

and their impact is diluted.

 Indicators should be underpinned by an information system

that enables the information required by the indicator to be

readily available.

 In defining success, experience has shown that input at the

development stage from those using the indicators will help

engender ownership and support for the application of the

indicators.

Because of the usefulness of the guidelines prepared by the

NSW Treasury in developing an asset strategy, the NSW template for doing so is reprinted in Appendix E. 

Asset Management Information Systems

RTA has information systems for inventory and condition data

that can be used to assign project/work tasks as well as to

monitor systems performance. The physical assets monitored

include road pavements, bridges, corridor assets, traffic facility

(signs, lines and markings), and traffic signals. 

RTA has purchased commercial software to manage its road

network inventory data. The Road Asset Management System

(RAMS) is the repository of road pavement and corridor

inventory and condition data, including engineering history. A

Traffic Asset Information Management System (TAIMS) keeps

track of the traffic facilities inventory (road signage, pavement

markings, line marking, and safety barriers), including work

task scheduling and management. RTA has separately developed in-house information systems to manage bridges (BIS)

and slope stability, works ordering, contract management, and

project management systems.

Maintenance work is tracked through a Maintenance

Contract Management (MCM) system. When maintenance

work is completed, reports are submitted to the asset management group for recording in RAMS, BIS, etc. Regional

maintenance planners are responsible for tracking planned

maintenance.

RTA uses a link/node location referencing system to locate its

inventory and condition data on the state road network. This

is used in conjunction with global positioning systems (GPS)

technologies for asset inventory updates. Given a common

referencing system, inventory and condition items can be colocated and displayed with other spatial characteristics. 

Figure 19 (see page 43) shows the results of the integrated

asset information system. The information describes key characteristics of a short portion of the highway from Melbourne

to Brisbane. The information includes the condition and operational characteristics in comparison to performance measures, indicating deficiencies by color (red implies that standards or measures are not being met). The right side of the

figure shows the projects planned in this corridor over the

next 5 years.

Figure 17. Decisionmaking structure for asset management in New South Wales.
Data Collection

Data collected for the asset management systems include

1) structural condition for pavements, bridges, culverts,

vehicular ferries, and utilities under highways; 2) 

dimensions (widths and heights) for tunnels, truss 

bridges, utilities over highways, lane and shoulder widths,

and turning space; 3) operational performance such as 

traffic flow, incident management systems, ventilation/fire

management systems for tunnels, and frequency of 

road-passing opportunities; 4) safety such as skid resistance, road and bridge width, road shape, alignment, 

deformations, and ride quality and lane widths affecting

driver fatigue; and 5) environmental characteristics such 

as noise, pollutant 

emissions, and water

pollution. 

Road inventory data

(including condition

data) are collected

through a combination of

in-house resources and

contract services. Road

condition data (roughness, rutting, cracking,

video, and skid resistance) are managed by a

unit in RTA’s central

office. Data are made

available to regions via

corporate information

systems. Bridge condition

inspections are managed

regionally, defined with a

four-tier inspection

regime (drive through,

condition- rating 

elements, engineering

inspection, and load

capacity) and schedules

depending on the 

criticality of the structure

(timber bridges every

year, other structures

every 2 years, and 

underwater inspections

every 4 years). 

Smart sensor technology

is starting to be used to

monitor a variety of

assets (slope and 

retaining wall stability

and bridge health monitoring), and to determine use (volume,

load, and speed) and incident management response.

Analysis Procedures and Prioritization

The analysis procedures and prioritization schemes RTA uses

depend on the type of asset program being considered. For

network and road capacity expansion, benefit-cost analyses

are used to justify investment. For maintenance-of-service

effort, or what would be called infrastructure asset management, projects are prioritized through a risk management

process. Separate program budgeting occurs for different

types of projects and agency services triggered via a 

deficiency or gap analysis. Within the maintenance program, 

42 | CHAPTER 3

Figure 18. Examples of Roads and Traffic Authority performance measures.
a two-stage process is used to prioritize allocations. 

These stages or prioritization levels include the following 

(in order of priority):

 Prior government commitments (e.g., disaster relief or 

financial assistance to local governments) and business

management needs (e.g., data collection and information

system support)

 Maintenance of the state road network, including keeping

the route functioning (e.g., slope stability), assuring safety

(e.g., pavement conditioning and bridge widening), assuring

minimum risk to the value and integrity of the asset (e.g.,

painting bridges and reconstructing pavement to enhance

useful life), and assuring productive and reliable level of

service

After government commitments have been taken care of, priority is given first to safety improvements (risk minimization),

then to retained value, and then to asset functional reliability. 

Similar to other Australian states, heritage bridges provide an

important challenge to the structures asset preservation program. Many bridges in New South Wales are considered historical, and the asset management process deals with such

bridges as special cases. 

The concept of risk management permeates the asset 

management prioritization process at RTA. Such an

approach is based on Australian/New Zealand standards

for risk management, corporate risk evaluation criteria, 

TRANSPORTATION ASSET MANAGEMENT | 43

Figure 19. Results from the New South Wales integrated asset management system.

“The challenge is to make asset management and

maintenance management ‘sexy.’”

—RTA OFFICIAL
different rates. Bridges are similarly valued, using different depreciation rates (steel/concrete at 100 years

and timber at 60 years). The total road system asset

value is estimated at A$65 billion (including land).

Public-Private Partnerships

RTA has entered into several public-private partnerships

(PPP) for toll roads. One such project, called the Eastern

Distributor, was awarded a 48-year concession in 1997

to build, operate, and maintain a freeway connecting

several of Sydney’s major roads. The 48-year term was

arrived at after lengthy negotiations involving public 

consultation over an acceptable design (the originally

estimated concession term was 35 years). The resulting

compromise included additional bridging over the toll

road to create more open space, and moving the tunnel

portals away from sensitive environments (botanical 

gardens and an art gallery). This road now averages

around 3 million vehicles per month. 

The operator’s agreement required conducting routine

maintenance and repair, identifying premature deterioration, keeping maintenance records, and making sure the

asset met the handover obligations. The road operator

provides a maintenance plan for such activities as

inspection, cleaning, and consumable replacement;

reports on unplanned maintenance; and undertakes

planned major maintenance tasks (e.g., pavement 

resurfacing or replacement of major mechanical or 

electrical components such as a jet fan). 

Another PPP project will open soon. This project placed

a greater emphasis on asset management in the request

for proposals. In this case, an asset management database is required that classifies assets according to 

hierarchy and spatial location, the historic profile of

design and construction data, asset condition, and maintenance servicing records. An asset management system

using deterioration modeling that predicts future asset

condition and develops maintenance profiles (life cycle

optimization) must be put in place. Condition deterioration (e.g., roughness and pavement condition) of individual assets is calibrated to actual historical profiles, and

asset condition is assessed on a regular basis and reset

after remedial work. Real-time monitoring of key 

performance indicators is part of the operator compliance with

the deed requirements. In addition, an asset 

manager position must be created as part of the concessionaire’s organizational structure.

The operator for a PPP project (not the concessionaire) 

discussed recent developments and emerging trends in 

PPP arrangements that will have different consequences 

scenario analyses, and promotion of safety improvements as

top-priority investments. 

Asset values are determined by an estimated replacement

cost approach (derived from recent construction unit rates

and redetermined every 5 years with yearly increments in

between) and straight-line depreciation to determine an

asset value. Pavement and earthworks are depreciated at

44 | CHAPTER 3

Innovative Public Agency/

University Partnership on 

Asset Research

A

new road tunnel under Sydney Harbour was RTA’s first 

BOOT (build, own, operate, and transfer) project.

RTA entered into a 30-year contract with the Sydney

Harbour Tunnel Company (SHTC) that expires in 2022.

RTA/SHTC entered into an innovative partnership with the

University of New South Wales as part of a project to monitor

the corrosion of a new road tunnel under Sydney Harbour.

The tunnel was designed with a 100-year life.

A transition tunnel structure was cast in-situ below sea level

and under the Sydney Opera House.This structure was the

most complicated and critical section for the long-term 

durability of the tunnel.The A$750 million project was

implemented under a public-private partnership, with a

maintenance sinking fund established upfront to deal with

periodic and unexpected maintenance needs. Routine

inspections were part of the concession deed, with specific

requirements for corrosion rate measurement and crack

movement monitoring.

The University of New South Wales, in partnership with the

tunnel authority, developed new and innovative concepts for

maintaining this critical asset.The university developed a new

curvature mapping projection that allows identification of

corrosion hotspots, pioneered a micro cement crack injection

capability that is a new corrosion remediation approach,

developed a local cathodic protection technique, and conducts lab tests to identify the influence of crack width on

corrosion rate.

The interesting characteristics of this case were 1) joint 

management of a maintenance sinking fund to ensure suitable condition at handover, 2) detailed analysis to identify and

qualify risks, 3) novel remedial strategies to manage risks at

minimum costs, 4) research to fill the gap in routine knowledge, and 5) state-of-the-art techniques to add value to the

long-term durability of the tunnel infrastructure.
on different stakeholders. For example, the increasing use 

of maintenance standard codes in contracts clarifies the

scope of maintenance tasks and reduces the risk of dispute.

Incorporating key performance indicators into contractor

agreements and monitoring operator performance against

these indicators provides an excellent method for monitoring

critical areas of performance, but runs the risk of entailing

excessive costs for data collection. The trend toward using a

contracting agent to operate a facility and passing additional

risks from the concessionaire to this operator could result in

substantial cost increases, and a shift from what has been 

a trusted partnership to a relationship based more on 

contract language.

Observations

Similar to other Australian states, RTA shows a high level of

consistency among the agency’s many levels of decisionmaking in what it is trying to accomplish. Performance measures

are in large part a reason for this, as is a serious effort to

think carefully about how one plan relates to another.

Because of Treasury guidelines, asset management is 

integrated in these plans, as is an asset management policy.

RTA has reached an agreement with Treasury on what constitutes maintenance versus major rehabilitation. Sometimes a

fine line exists between the two, and RTA has established the

boundaries of its asset management program to include

minor rehabilitation projects. 

The Road Asset Management System (RAMS) appears to

have very good functionality for decision support (see figure

17). It can display a variety of information useful to road managers, including condition and performance deficiencies, relevant standards, and proposed projects in the corridor. 

RTA has concerns about whether straight-line depreciation

and accounting standards are the appropriate way to value

assets. RTA has discussed this issue with Treasury, and

although RTA still reports value and remaining life according

to the guidelines, it relies on its asset management systems to

help define priorities. 

Finally, the New South Wales learning experience with publicprivate partnerships and the appropriate role for asset management is very important. The evolution in the consideration

of asset management responsibilities between the first project’s and second project’s concessionaire contract was dramatic (the same is true in the Victoria case). 

RTA has adopted a serious approach to asset management as

it pertains to PPP projects. This could be an important lesson

for the United States, which is turning increasingly to publicprivate partnerships for major project investment. 

QUEENSLAND,AUSTRALIA

Main Roads—www.mainroads.qld.gov.au

Context

Queensland is the size of Alaska (2.5 times the size of Texas),

but has a population similar to that of Iowa. This could

change, because Queensland expects a 50 percent population

increase over the next 25 years, making it the fastest-growing

state in Australia and possibly its most populous in 30 years.

In concert with this population growth, freight demand is

expected to double over the next 20 years. This is a particular

challenge to road managers because much of this truck

growth will be in the natural

resource industry. Three of

the top five exports are natural resource-related and the

trucks serving this industry

tend to be long and heavy. 

All of this growth places

increasing pressure on

Queensland’s transportation

network to handle significant

increases in travel. 

The Department of Main

Roads is the agency 

responsible for 34,000 km (21,127 mi) of Queensland’s road

network, representing 20 percent of the state’s total road 

network but carrying 80 percent of the traffic. This road 

network is the state’s largest single physical asset, with 

a replacement value of A$26.6 billion (US$20.1 billion). 

To manage this network, Main Roads is divided into four

regions and 14 districts. Routine maintenance of this 

network is often carried out with Road Maintenance

Performance Contracts. 

About one-third of the maintenance is done this way, and of

this one-third, two-thirds is done by maintenance organizations or firms and one-third by local government. Although

Main Roads has considered outsourcing all maintenance, the

employment needs of rural Queensland have created political

pressure to keep public employment. The prominent player in

outsourced maintenance delivery is RoadTek, Main Roads’

internal commercial business provider. With a usual contract

period of 1 to 2 years, contractors become an important component of the network condition and operations management

structure.

According to Main Roads’ officials, the key transportation

challenges Queensland faces include providing the infrastructure necessary to accommodate increasing travel growth,

dealing with increasing congestion (including incorporating

transit services into major road corridors), serving rural areas

TRANSPORTATION ASSET MANAGEMENT | 45

Transportation

Infrastructure

Managed

By Main Roads

 34,000 km (21,127 mi) of roads

out of 174,000 km (108,122 mi)

 2,740 bridges (560 timber)

 20,000 major culverts
46 | CHAPTER 3

“In the short term, we must deliver our capital program, but over the long

term, we are responsible for the investment in our road asset. . . . 

It is not an either/or decision; we must do both.”

—MAIN ROADS OFFICIAL

accessible only via roads, rehabilitating a large number of

bridges subject to heavy truck loads, and meeting customer

expectations in a financially constrained environment. Main

Roads’ officials stated that they want their agency to be

viewed more as a road management agency, not just a road

builder.

Drivers for Asset Management

A 1994 law that required government agencies to adopt an

outcomes-based approach to business decisions was a major

impetus for Main Roads’ evolution toward asset management.

This was the beginning of Main Roads’ concerted effort to

adopt a road network strategy based on performance 

monitoring.

The first major steps in a government-wide approach to asset

management occurred in 1997 when Queensland’s Treasury

Department adopted the Financial Management Standard 1997,

which required agencies to undertake asset strategic planning

as part of their strategic and operational planning processes.24

Such planning was charged with focusing on an asset’s life

cycle, associated costs, and how the asset aligns with service

delivery outcomes and government priorities. An asset strategic plan was required, which was intended to reinforce the

government’s policy that public investment in infrastructure

should adopt a whole-of-government approach so that limited

resources could be focused on obtaining the most value to

the community. Queensland’s public-private partnership (PPP)

policy also states that when an asset has an initial capital cost

exceeding A$30 million (US$22.6 million) or when the net

present value (NPV) of the asset’s whole-of-life costs exceeds

A$50 million (US$ 37.8 million), then agencies must, in conjunction with the Asset Strategic Plan Guidelines of the

Queensland Treasury, undertake an analysis using a value-formoney framework.25

Because the 1997 standard was so important in initiating

asset management practices throughout Queensland’s government, it is worthwhile to examine what was required in the

asset management plan. The plan required the following:

 Document an agency’s needs for asset resources.

 Outline the evaluation process used to determine the most

appropriate solution to the asset needs identified.

 Improve analysis, planning, and monitoring of recurrent

expenses by adopting a whole-of-life costing approach

when procuring new asset resources.

 Improve the alignment of asset resources with output 

production requirements.

 Highlight the risks associated with asset resource 

acquisition and control.

 Encourage the examination of options for delivering services

(capital investment, capital grants, and private-sector

involvement).

 Foster a proactive planning culture of anticipating future

asset requirements, which will minimize the risk of not 

providing needed services.

Although Main Roads had already begun some effort in 

pavement and bridge management before 1997, the standard

spurred the agency to make its asset management program

more comprehensive. In addition, as of 2000/2001, only 

one-third of local governments had some form of pavement

management system, so the standard spurred interest 

among local officials as well for more comprehensive 

asset management efforts.

In 2000, Queensland Treasury issued guidelines to replace the

1997 standard that have had an especially strong influence on

asset valuation. The Non-Current Asset Accounting Guidelines

for the Queensland Public Sector provide guidance on identifying, valuing, recording, and writing off noncurrent physical

and intangible assets.26 This new guideline requires assets to

be measured either at historical cost or fair value. This has

resulted in Main Roads adopting an asset management

approach to asset valuation that is one of the few such 

applications the team observed on this scan. This asset management approach has led to, or at least occurred simultaneously with, a changing Main Roads philosophy of wishing to

be viewed more as a road manager than a road builder.

Another driver for asset management found in Victoria, but

not as prevalent in Queensland, was the legal treatment of 

24 Queensland Treasury, Financial Management Standard 1997, Reprint 3C, Brisbane, QL, see: http://www.legislation.qld.gov.au/LEGISLTN/CURRENT/

F/FinAdminAudSt97.pdf. 25 Queensland Treasury, Asset Strategic Management Guidelines, Brisbane, QL, July 2003, see: http://www.treasury.qld.gov.au/office/knowledge/docs/

asset-planning/asset-strategic-plan-guidelines.pdf. 26 Queensland Treasury, Non-Current Accounting Guidelines for the Queensland Public Sector, Brisbane, QL, May 2001, see, http://www.treasury.

qld.gov.au/office/knowledge/docs/non-current-assets/non-current-assets.pdf.
liability. Unlike Victoria, where the law on nonfeasance27 was

overturned (resulting in the need for a defensible investment

decisionmaking process), Queensland has kept its nonfeasance law. Queensland is waiting to see what happens in

Victoria to determine if it is workable and desirable. 

Organization for Asset Management

Main Roads has established a Road Asset Maintenance

Steering Committee (RAMSC) to oversee the development of

road and bridge maintenance policies. This group oversaw the

publication of the Road Asset Maintenance Policy and

Strategy, a vision for road asset management practice in the

agency. In the agency itself, the primary organizational unit

responsible for asset management is the Road Network

Management Division, although many other units contribute

data and expertise. This division is responsible for asset management information systems, which, according to the division’s description, are “integral to enabling our division to play

a major part in the analysis of road network and maintenance

solutions.” 

Important to the implementation of asset management in

Main Roads are principal engineer positions that are responsible for network performance, including asset management

delivery, which have been established in all regional offices.

Main Roads’ asset management program has also developed

targeted training programs and courses aimed at improving

the asset management capabilities of its own staff.

Main Roads has established a unique institutional structure

for decisionmaking at the regional level. Called the Roads

Alliance, this program encourages local governments to join

with peers with mutual interest in the road network to identify

and assign priorities to roads of regional significance.28

Regional road groups (the term used to describe this peer

committee) have been formed in all 15 regions. Main Roads

participates in these road groups, which now include 125 of

the 126 local councils. Local governments and Main Roads

contribute investment funds to a regional pot of money to

spend on roads of regional significance. 

By 2005/2006, the regional road groups are expected to develop 5-year investment programs that will be incorporated into

the Main Roads Improvement Program. These investment programs will include a 4-year fixed schedule of investment along

with one indicative year. Other conditions are that at least 80

percent of Main Roads’ funds must be allocated to the state

road network, no group member is required to spend its funding outside of its jurisdictional boundaries, and all routine

maintenance is the responsibility of the road owner.

Preliminary experience with this structure has suggested that

local governments understand the need for a regional perspective on asset management and, in some cases, have allocated their own funds to support projects outside of their

jurisdictions. 

Another benefit of the Roads Alliance is that it has developed

joint purchasing and resource-sharing practices. These practices range from improved project-scheduling procedures to

better methods of identifying risks. A Roads Alliance Road

and Bridge Asset Management Kit has been developed that

lays out the key steps in asset management practice. The

Roads Alliance also sponsors workshops and training sessions on tools and techniques to improve the productivity of

public works employees. 

Decisionmaking Approach

Main Roads relies on plans and decision support systems 

to support policy development and organizational decisionmaking. For example, Roads Connecting Queenslanders is 

the overall statement of vision and strategy for a cost-effective

road investment program in Queensland.29 This plan, 

referenced in all asset management documents, establishes

the overall framework for Main Roads’ activities in asset 

management. 

A Road Asset Maintenance Policy and Strategy (RAMPS) 

was published in September 1999 with the goal of fostering 

a whole-of-life performance approach to Main Roads’ 

investments in maintenance.30 It also defined maintenance

performance standards, and recommended that an analysisbased planning approach be used to support decisions. 

Such a decision support system should exhibit the 

following desirable functions: 

 Support planning, programming, preparation, and policy

research functions.

 Present relevant, reliable, and up-to-date information.

 Predict future impacts on the transport system and its users.

 Compare competing investment or policy choices.

 Consider both the infrastructure and the community.

TRANSPORTATION ASSET MANAGEMENT | 47

27 Nonfeasance can be defined as the failure of an agent (employee) to perform a task he/she has agreed to do for his/her principal (employer). 28 For the latest progress report on the Roads Alliance, see: http://www.mainroads.qld.gov.au/mrweb/prod/Content.nsf/

fbadb90201547b374a2569e700071c81/d514e8ed960961904a256bc100802eb1!OpenDocument. 29 Main Roads, Roads Connecting Queenslanders, A Strategic, Long-term Direction for the Queensland Road System and Main Roads, Brisbane, QL,

May 2002, see: http://www.mainroads.qld.gov.au/mrweb/prod/Content.nsf/fbadb90201547b374a2569e700071c81/7ceb01526342d9a84a256bc6008394e3/

$FILE/MR%20RCQ%20Report1.pdf. 30 Main Roads, Asset Maintenance Policy and Strategy, Brisbane, QL, Aug. 2002, see: http://www.mainroads.qld.gov.au/mrweb/prod/Content.nsf/

fbadb90201547b374a2569e700071c81/a9b38e68267717d14a256c4d00171fb7/$FILE/Part1.pdf.
 Allow for new work, maintenance, and upgrading.

 Provide a reliable calibrated modeling capability.

 Assess investment impacts over life cycles.

 Provide monetary and nonmonetary measures of 

investment effectiveness.

In RAMPS, Main Roads defined the relationship among the

many different components of a road system management

program, including the role for asset management. Figure 21

shows where road asset management and maintenance fit

into this broader scheme. The concept of road system management has been recently reinforced with the development

of a strategic framework for asset management that links different asset management functions to decisionmaking (based

on Austroad’s Integrated Asset Management Framework).

This framework is called the Road System Manager, whose

purpose is to provide “a consistent state-wide understanding

of how Main Roads conducts its business” and a “high level

view of Main Roads’ end-to-end processes and key deliverables in meeting Government priorities and community outcomes, thus providing an environment for decisionmaking,

policy development and support.” 

Note that the word “asset” is not in the term “road system

manager.” Main Roads officials believed that because of 

confusion about what asset management might entail 

(maintenance? preservation? rehabilitation?) it was best to

keep asset out of the term. The specific objectives of the 

road system manager framework are the following:

 Provide relevant decisions for Queenslanders by 

maximizing benefits and minimizing risks on the road 

network, making investment decisions context sensitive

and “fit for purpose,” and providing a legally defensible

rationale for such decisions.

 Promote coordinated program delivery for capability by providing a unified and easy-to-understand view of

Main Roads’ business and by linking

the different business units within the

agency into one networked “organization of capabilities.”

 Guide the development of quality

tools to support Main Roads business

by providing access to basic businessrelated information and by maintaining organizational capability.

Figure 22 (see page 50) shows the

strategic framework for road system

management. As noted by Main

Roads’ officials, this framework also

represents a subconscious change in

organizational mindset. Even though

changes in performance-oriented business practices in the

agency had been tried, funding allocations had still been done

on a traditional basis and at levels similar to those of previous

years. There was thus a sense that something more than just

performance-based decisionmaking was necessary. The Road

System Manager framework is attempting to evolve toward a

road system performance perspective, strongly tied into 

budgeting. 

Because of its importance in explaining the linkage between

asset management and decisionmaking in Main Roads, the

key components of this framework will be described below.

The first set of framework phases—phases 1 to 4—was called

“aligned decisionmaking.” This meant the framework was

intended to relate agency outputs to desired government outcomes, align prioritization of plans and programs with these

desired outcomes, conduct sensitivity analyses with funding

scenarios, and accommodate broad policy statements. It

adopts a whole-of-government outcomes orientation and,

when institutionalized, is expected to survive any change in

government or administration. 

Phase 1: Outcomes and Direction—Sensing and interpreting the external environment to provide tangible direction to

Main Roads’ outcomes and outputs. This phase uses government policies, community input, market research, and Main

Roads’ documents that outline the desired directions for the

road network as a means of making sure Main Roads is following the direction desired by the public. Main Roads’ strategic plan is a primary input into this phase.

Phase 2: Road System Planning and Stewardship (15-

plus years)—Translating policy directions and strategic choic48 | CHAPTER 3

Figure 20. Similar to other Australian states, Queensland has numerous timber

bridges that present important challenges to its asset management program.
es/priorities into action plans. This phase includes modeling

and other data-based analysis efforts to understand different

aspects of road performance and to conduct investment

analysis, including forecasting of future performance. The

major output of this phase is a Road System Performance Plan

that includes a financing plan, a priority network plan, identification of strategic asset metrics (such as condition measures),

identification of 39 strategic delivery metrics (e.g., dollars per

kilometer), and a network safety analysis.

Phase 3: Corridor Planning and Stewardship (less than

15 years)—Developing future-oriented plans and investment

strategies for corridors, as well as stewardship of the current

asset and operation conditions. The corridor plans should be

multimodal and include consideration of land use and cultural

heritage. The term used to describe

the types of actions to be 

considered is “fit-for-purpose” 

solutions. Main Roads regional

directors must present proposed

corridor investment plans to the

deputy director-general of Main

Roads for approval and final 

decision. 

Phase 4: Program Development

(less than 7 years)—Producing 

priorities for projects in 

maintenance, operations, and 

network enhancement. Weighting 

methodologies for seven elements

have been developed and

approved legislatively. The 

major result of this effort 

is a 5-year Roads Implementation

Program (RIP) and production 

of road project concepts. Main

Roads referred to this phase as

“Doing the Right It!” 

The next three phases were labeled

“co-ordination of program, project

and works management.” This

meant that the Main Roads budget

allocation process would be tied

closely to the desired outcomes

defined earlier, that all aspects of

transportation system performance

(including land use coordination)

would be included in the Main

Roads strategy, and that the 

community would be engaged 

in program development.

Phase 5: Program Delivery—Delivering the RIP, including

the preliminary and detailed project designs, construction, 

and maintenance within road corridors. In essence, this phase

includes all steps necessary to design, construct, operate, 

and maintain a road network. Main Roads referred to this

phase as “Doing It Right!”

Phase 6: Program Finalization—Comparing completed projects and program delivery with baseline performance requirements. This phase compares actual performance with what

was desired originally. In addition, investigations are conducted to determine what lessons can be learned from program

and project experience. Main Roads referred to this phase as

“Learning from Doing.”

TRANSPORTATION ASSET MANAGEMENT | 49

Figure 21. Road asset maintenance in the context of road system

management in Queensland.
50 | CHAPTER 3 Figure 22. Strategic framework for road system management in Queensland.
Phase 7: Review—Measuring the actual outcomes against

desired outcomes. This is the feedback loop to the decisionmaking process that informs future decisions. Main Roads

referred to this phase as “Proof We Got It Right!” The band

across the bottom of figure 22 represents the engagement of

the community and key stakeholders throughout the decisionmaking process. 

To identify a program of investments, the program is tailored

to target whole-of-government outcomes, and to show

increased accountability and transparency. However, Main

Roads’ officials stated that over time this is becoming much

more complex, especially considering the many factors outside of the transportation sector that now must be considered.

With uncertainties surrounding a changing federal role in

funding the national road network, programming of road

investments is becoming even more uncertain. 

Performance Measures

Enhancing transportation system performance and meeting

the government’s desired outcomes drive much of the investment decisionmaking in Main Roads. A distinction is made

with the terms outcomes, outputs, and inputs, as shown in

figure 23. As described earlier, Roads Connecting

Queenslanders establishes the overall performance outcomes

desired from the road network. Four outcome categories were

identified in the report—efficient and effective transport to

support industry competitiveness and growth, safer roads to

support safer communities, fair access and amenity to support livable communities, and environmental management to

support environmental conservation. 

Main Roads’ strategic plan defines the relationship 

between these four outcome categories and agency 

outputs. These outputs were defined at different levels,

including road system, road corridor, road operation, 

road project, and business capability. Specific deliverables

and schedules were specified as well. In addition, this 

plan explains how Main Roads will meet government and

customer expectations. 

TRANSPORTATION ASSET MANAGEMENT | 51

Figure 23. Performance management at Main Roads in Queensland.
52 | CHAPTER 3

Individual unit business plans specify the resources, time, and

costs associated with putting in place the organizational

capacity to deliver desired performance. Performance measures are defined at varying levels of specificity at each level of

decisionmaking. At one time, Main Roads had a composite

level of service measure for system performance, but the public and elected officials did not understand its meaning so

Main Roads went back to travel time as the key measure.

Although the plans identified above provide general 

information on how the road network’s performance relates

to broad performance goals, data on specific measures of

interest to Main Roads’ management are also collected. 

For example, a recent Main Roads’ workshop on data and

the relative importance of different data categories found

that the desired data relating to network condition included,

in order of preference, roughness and rutting, surface 

texture, field inspections, skid resistance, digital video

records, pavement strength, and surface condition 

(e.g., cracking, patching, and edge break). 

Asset Management Information Systems

The Queensland Treasury guidance on asset management

stated that “a prerequisite of sound asset management is relevant, reliable and timely information about asset resources.”

According to the Treasury, this information, best provided 

in a structured way through asset management systems, 

is important for undertaking the following tasks:

 Assessing whether particular assets are being used in the

manner that most effectively meets the goals and objectives

of the organization

 Assessing whether assets controlled by the organization 

are properly maintained, enabling the agency to meet its

current and future requirements

 Planning for the future replacement of assets

 Identifying and planning for the disposal of surplus or

underused assets

 Effectively managing the risks associated with asset control

 Determining the cost of the outputs, products, and services

the agency provides

 Assessing, where appropriate, the commercial competitiveness of the agency

Main Roads has been developing asset management systems

since the 1990s, when both pavement and bridge asset management systems were first developed. Figure 24 shows the

basic configuration of the road asset management system

(RAMS) used today. As shown, RAMS uses data on finance,

inventory, condition, traffic volumes, and policies/standards for

the decision support function it provides. A variety of reports

Figure 24. Road asset management system in Queensland.
TRANSPORTATION ASSET MANAGEMENT | 53

can be generated on asset condition, network performance,

and project investment. 

A bridge asset management system (BAMS) was first developed in the late 1990s when senior managers wanted a better

sense of the condition and performance of the approximately

2,700 bridges under state control. BAMS contains Main

Roads’ inventory of all bridges (including 560 timber bridges)

and 20,000 major culverts, and allows the user to address the

risks associated with defective structures (see figure 25 on

next page). The management system includes not only the

inventory, but also a prioritization method for assigning priorities for bridge maintenance (discussed below), and guidelines

for the types of strategies appropriate for substandard and

defective bridges. As noted in the BAMS description, BAMS

produces “defensible maintenance programs from non-feasance and risk perspectives.” Figure 26 (see page 55) illustrates the type of information BAMS can produce.

The comprehensive database available to Main Roads, called

A Road Management Information System (ARMIS, see page

55), has several operational systems that allow Main Roads

employees to manage road system data. These include a

Road Reference/Road Inventory (RR/RI), Bridge Information

System (BIS), Pavement Condition System (PAVCON), Traffic

Analysis and Reporting System (TARS), Road Crash 2 System

(RCRASH2), and a Road Maintenance Performance Contracts

Management System (RMPC). For example, BIS produces the

following types of asset management reports: progress

against performance measures, trends in inspection, outstanding inspections, defective bridges by severity and trend,

and heavy vehicle vulnerability maps. The PAVCON system

provides information on such things as total district network

status, relative status and priorities between road classes,

detailed distribution of different types of road condition along

a road section, and identification of project and maintenance

priorities. 

Data Collection

Main Roads began building a comprehensive database system in the early 1990s. This system has evolved into ARMIS.

As shown in figure 27 (see page 55), ARMIS encompasses

much of the data that a modern transportation agency needs

for network management, including data on crashes, traffic

volumes, pavement condition, road inventory and referencing

systems, bridge condition, and road maintenance contracts.

This database is linked to reporting systems such as the

maintenance management system and the construction management system, allowing data to be updated when network

changes occur. The data can be accessed via different media,

both online as well as in print form. Those interviewed during

the scan indicated that Main Roads is at a crossroads. Given

that this database system has been in place about 20 years

and data-collection technologies have evolved since then, the

question Main Roads faces is what is the most cost-effective

way of getting, storing, and accessing the data necessary to

support agency decisionmaking?

To begin answering this question, officials have given thought

to what types of data should be collected. For business operations at the system level, desired data include maintenance of

sealed road apparent defects, sealed road pavement surface

deficiencies, pavement structural deficiencies, maintenance of

unsealed road apparent defects, crash investigations, network-level crash analysis, hazardous grades, and intersection

upgrading records based on high crash rates/potential. For

business operations at the corridor level, desired data include

management of roadside and surface delineation, fatigue

management, skid resistance, and traffic-generated noise in

urban areas. For bridge data, Main Roads has adopted a

schedule for inspections, ranging from once every year to 8

years, depending on bridge type and the results of prior

inspections. For roads, 20 percent of the kilometers on which

data were collected are audited, (that is, data are collected

again). The district road manager must sign off on the quality

of the data collected. 

According to Main Roads officials, video log data are by far

the most actively used by both Main Roads engineers and

consultants. On an average week, this video log Web site

receives about 1,000 hits.

Analysis Procedures and Prioritization

One of the major products feeding into agency investment

decisionmaking (and thus establishing an overall analysis

framework) is the Road Network Investment Strategy. The purpose of this strategy is to 1) formulate a vision for the network

based on industry and community demand, sound engineering

principles, and realistic funding scenarios; 2) develop appropriate standards of performance and prioritize capital and maintenance dollars for each link in the network; and 3) assess benefits in terms of several criteria, including freight, efficient vehicle

routing, safety, access for industry, benefit-cost ratio (BCR),

community access to essential services, emergency access,

environmental sustainability, and agency risk.

For bridge maintenance needs, Main Roads has developed a

program called Whichbridge that assigns a numerical score to

each bridge based on the risks attached to the condition 

of the bridge. The factors considered in this assessment

process include condition of bridge components, effect of

multiple defective components, significance of members to

load-carrying capacity, global and local environmental

impacts, component materials, currency of inspection data,

obsolete design standards, and traffic volumes. The system,

relying on Level 2 inspection reports, ranks structures based
54 | CHAPTER 3 Figure 25. Bridge asset management system framework in Queensland.
on risk exposure and safety considerations (a relative, not

absolute, ranking). The probability of failure is multiplied by an

assessment of the consequence of failure. The probability is

expressed as a function of such things as loading, resistance,

condition, inspection data, and exposure. 

Consequence is a surrogate for the costs of failure, which relate to such

things as human factors,

environmental, traffic

access, economic, road

significance, and industry

access consequences.

Figure 28 (see page 56)

shows the input screen

for Whichbridge and the

types of factors that can

influence the prioritization

outputs.

Table 6 (see page 56)

shows an example of the

results presented to 

Main Roads’ management. In this table, the current risk scores are related to the

best possible scores for bridges in each region. The ratio of

current to best scores gives managers a sense of which

region faces the most severe bridge problem (the higher the

number, the worse the problem). The use of risk measures in

TRANSPORTATION ASSET MANAGEMENT | 55

Figure 27. A Road Management Information System in Queensland.

Figure 26. Condition of timber bridges in Queensland.
analysis and performance monitoring has also been a very

useful strategy for getting the attention of elected officials.

Some Main Roads officials believe that the concept of risk is

one that elected officials can grasp easily, making them 

willing to consider funding allocations to reduce this risk. 

Main Roads has impressive capabilities for conducting 

scenario analyses. A series of software programs allows

Main Roads officials to understand the consequences on

network performance of different input factors such as

budget levels. One of these programs, called SCENARIO

Millennium, is a rule-based decision support tool that

assists in maintenance treatment programming by selecting

treatments based on rules and conditions, calculating costs

and benefits, making optimal treatment selections for road

segments, and predicting condition according to deterioration models. The program examines each road segment in a

typical group and produces suggested maintenance strategies and associated costs. The user can change input

assumptions relating to such things as discount rate and

unit costs. Figure 29 shows a typical SCENARIO output. The

colored boxes in the middle of the figure represent different 

treatment strategies that occur on different road segments

(on the x-axis) during different years (y-axis). The users of

this tool can also change the scheduled activities (colored

boxes) to different time periods and assess the resulting

performance consequences.

Use of this tool has already resulted in significant 

policy-related findings. According to Main Roads officials, 

the analysis has shown the following:

 In aggregate, statewide programmed maintenance funding

is insufficient to meet even the base case funding 

requirements.

56 | CHAPTER 3

Figure 28. Bridge prioritization program in Queensland.

Figure 29. Illustrative results from a Main Roads 

SCENARIO analysis.

Table 6. Comparative bridge risk scores across Main Roads’ regions.

Category State Region Comments

Northern Central Southern Southeast

Bridge Risk Scores

Risk-Current Condition 3,283,072 219,794 1,242,534 1,031,429 789,315 As calculated by Whichbridge

Theoretical Risk-Good Condition 836,023 171,367 268,767 175,048 220,841 Condition of all components set

to state 2

Risk Index 3.93 1.28 4.62 5.89 3.57 Risk/Theoretical Risk

No. Bridges > 1,500 266 13 80 115 58

No. Bridges > 3,000 179 6 60 79 34
 To achieve the pure performance targets, twice the funding

would be required for National Highways, and three times

the funding would be required for other state roads.

 On a pure system performance basis, allocation of 

programmed maintenance funding between and within

regions is inequitable.

 Performance equity can be improved by reviewing the 

allocation of existing budgets.

An interesting finding from the Queensland visit was the

approach Main Roads has adopted for valuing its assets,

which Treasury has approved. The original approach to this

valuation, following the Financial Management Standard 1997,

was fairly simple. Only four road network components were

considered: bridges, surfacing, pavements, and formations. A

straight-line depreciation method was used, as were standard

useful lives and current replacement costs. Very small residuals (one-seventh to one-fortieth) were incorporated into the

valuation. The valuation was based on road length and number of lanes, and there was very little linkage to the agency’s

asset management processes. 

Given new Treasury guidelines, a reassessment of the 

valuation process was undertaken, resulting in 19 recommendations. The primary focus of the recommendations was to

provide a stronger linkage to Main Roads’ asset management

processes. The most important recommendations for asset

management were the following:

 Continue the internal audit of 20 percent of the data 

collected for ARMIS. 

 Experiment with the use of equivalent single axles (ESAs) 

to quantify useful life and the use of condition to assess

remaining useful life for pavements.

 Adopt square meters as the unit of measure for surfacings

and pavement.

 Update procedure for calculating unit rates.

 Revise standard useful lives for formations and bridges.

 Adopt the established asset management useful lives for

surfacings.

 Introduce residual values.

Main Roads adopted several of these recommendations. 

For formations, bridges, and surfaces, a residual value and a

review of standard useful lives were introduced. Straightline depreciation was retained for these assets because the

consumption of the service potential of these assets was

driven primarily by environmental factors (time) and commercial or technical obsolescence. For pavement depreciation, the rate of depreciation followed the consumption of

future economic benefits (consumption of service potential),

and the determination of where the asset is in its life cycle

was based on the current asset management approach in

Main Roads.

The effect of these changes on the discounted asset valuation

was as follows:

 Using ESAs as a measure of economic benefits increased

asset value by about 4 percent, or A$700 million 

(US$528.5 million).

 Using pavement management systems to determine

remaining useful life had a net effect of increasing asset

value by 2.5 percent, or A$450 million (US$340 million).

 Using square meters as a unit measure resulted in an 

A$2 billion (US$1.5 billion) reduction in discounted value.

 Adjustments to standard lives for surfacings resulted in an

A$240 million (US$181 million) increase in asset value and

an A$30 million (US$22.6 million) decrease in depreciation.

 Using residual values at the end of useful lives had the

largest effect on asset value and depreciation. With other

changes, it will result in an A$2.1 billion (US$1.6 billion)

increase of asset value and an A$120 million (US$91 

million) decrease in depreciation.

Observations

Queensland is one of the world’s leading practitioners of 

asset management, in particular in the application of tools

and techniques. Several aspects of Main Roads’ asset 

management program stand out.

Similar to New Zealand, the level of asset management 

integration with agency activities was quite impressive. 

The asset management plan that was developed in the late

1990s was a very important point of departure for

Queensland’s asset management strategy. Decisions relating to asset preservation and maintenance, linked to this

and other plans, rely heavily on the performance measures

laid out in Roads for Queenslanders, Main Roads’ strategic

plan. The level of consistency among the different levels of

plans and the linkage to performance measures were 

found to be two critical foundations for an effective asset

management program.

The evolution away from asset management toward road 

system management seems a logical step in the evolution 

of asset stewardship. The RSM framework, in which asset

strategies are aligned with decisionmaking and program

delivery is coordinated among different agencies and linked

to a variety of goals, is a useful approach to a broader 

concept of network management. The linkages between 

the different steps in this framework, and the logical 

relationship between planning, programming, and coordination, result in a good model of how to consider asset needs

in agency decisionmaking in the most effective way.

Main Roads clearly had the most impressive analysis 

capability of all the sites visited. The Whichbridge program

for prioritizing bridge maintenance and the SCENARIO

TRANSPORTATION ASSET MANAGEMENT | 57
58 | CHAPTER 3

package for conducting scenario analysis are state of the

art. In particular, the application of risk assessment in the

Whichbridge program is an intriguing example of how 

risk can be incorporated into prioritization schemes. 

Both programs are excellent examples of how analysis 

can educate both decisionmakers and the public on 

the infrastructure needs facing a community. 

Main Roads has been developing its road network database

for the past 20 years. ARMIS is recognized as having served a

very useful function in Main Roads, and in itself is a valuable

resource to the agency. However, questions remain about

what happens next in the development of an information support base for agency decisionmaking and road system management. Given Main Roads’ reputation for being at the cutting edge of information-based decision support, it will be

worth watching to see what it comes up with. Figure 30

shows the latest thinking on what Main Roads’ future asset

management system might look like.

An interesting aspect of Queensland’s asset management

approach is the direction it is heading in asset valuation.

Unlike other cases, where straight-line depreciation is used as

part of the valuation process, Main Roads has an agreement

with the Treasury to use management system outputs in

determining the remaining useful lives for pavements, thus

producing a more realistic assessment of asset replacement

value. The assessment that Main Roads went through in

examining different assumptions underlying the valuation

process and determining what impact they have on net present value is an important learning experience for other transportation agencies. 

Main Roads understands the human resource element of

asset management as well. It provides training courses and

publications on asset management aimed at increasing organizational capability in asset management practice. 

Finally, the innovative, coalition-building approach seen in the

Road Alliance is an excellent example of how to extend concern for asset management beyond a state’s jurisdiction. Tying

these activities to budget recommendations and developing

an institutional structure that reinforces the mutual gain that

comes from investments in asset preservation is a model to

emulate for increasing the effectiveness of asset management

efforts at state and local levels.

VICTORIA,AUSTRALIA

VicRoads— www.vicroads.vic.gov.au

Context

Victoria, about the size of Michigan, encompasses about 3

percent of Australia’s area. However, with 5 million people (3.6

million in Melbourne), it is the most densely populated state in

Australia. Victoria also has 4.1 million registered vehicles, representing about 33 percent of the Australian vehicle fleet, and

Figure 30. Future asset management system at Main Roads.
handles 25 percent of the country’s road freight on its 155,000

km (96,315 mi) of roads. 

VicRoads is the responsible authority for the road and traffic

management of 22,000 km (13,671 mi) of the state’s most

important arterials, handling about 70 percent of the vehiclekilometers travelled. The total value of the assets associated

with this network is estimated at A$11 billion (US$8.3 billion).

With annual program budgets of about A$861 million (US$650

million), maintenance budgets of A$530 million (US$400 

million), and revenues just over A$2.5 billion (US$1.9 billion),

VicRoads is one of the most capital-intensive and infrastructure-oriented agencies in Victorian government. The majority

of funds for road improvements come from state government.

According to VicRoads officials, the major issues facing

Victoria’s road network are 1) increasing travel demand, 

2) growing congestion in metropolitan road networks, 3)

aging infrastructure, 4) rising environmental and community

expectations, and 5) the challenge of optimizing system performance when individual travelers seek only to maximize

their own utility. Asset management-related community

expectations include ride quality and safe and efficient travel

through work zones. VicRoads officials are particularly concerned about a national trend to allow larger trucks to use the 

highway network. Victorian pavements are much thinner 

than those in the United States, so with increasing truck 

mass limits, they are expected to deteriorate even faster. 

Drivers for Asset Management

VicRoads officials identified several factors that led to increasing interest in asset management. First, there was a perception in the late 1990s and early 2000s that agency decisions

historically had not adopted a system-wide perspective that

led to the most cost-effective solutions. A comprehensive and

system-wide perspective was desired, especially for to asset

stewardship. 

Second, VicRoads faced shrinking budgets in real terms, so it

had to focus on the best use of its funds for accomplishing its

mission. An asset management program based on life cycle

costs was considered a major tool to support such decisions. 

Third, the public, elected officials, and VicRoads officials

became increasingly concerned about the risks associated

with road performance (e.g., safety, skid resistance, etc.).

Because of these concerns, a risk management approach was

developed that evolved from the application of simple investment rules for reducing risk to comprehensive data collection

and deterioration modeling to predict future risks.

It was clear to VicRoads

officials that some agency

activities (e.g., grass 

cutting) did not carry as

much risk as others (e.g.,

slope stabilization), which

led to some budget 

reallocation (e.g., cutbacks

in mowing budgets).

Fourth, the Victorian 

government, in particular

the Department of

Treasury, has established

principles and guidelines

for asset management at

the state and local levels.

In a Treasury document

entitled Sustaining Our

Assets, the service 

delivery model for the state emphasizes four main features:31

1. Service delivery needs. Regarded as the basis of all asset

management decisions, service delivery needs address the

social, environmental, and economic needs of all Victorians.

2. Life cycle approach to asset management. This

approach evaluates operating and maintenance requirements, and the implications of eventual replacement or

retirement of assets during acquisition decisionmaking. 

The planning process also includes evaluation of nonasset

alternatives for the delivery of services.

3. Integrated approach to asset management and service

delivery, across all assets and all governmental departments and agencies. This looks beyond stewardship of 

individual assets and examines the total asset base during

decisionmaking. It also means achieving balance across

government portfolios to optimize investment outcomes

(see figure 31 on next page).

4. Increased emphasis on accountability for asset investment. This, in turn, requires greater transparency and quality in reporting arrangements. 

The fifth, and most recent, driver for interest in asset 

management was the passage of the Road Management 

Act in 2004, which dramatically changed the legal liability 

of public agencies for road design and operations.32

Previously, government officials had immunity under the

concept of nonfeasance. The Road Management Act

TRANSPORTATION ASSET MANAGEMENT | 59

Transportation

Infrastructure

Managed

By VicRoads 

 22,000 km (13,671 mi)

of paved road

 5,000 bridges and major culverts

 3500 traffic signals

 170 CCTV cameras

 800 help phones

 350 freeway data collection

stations

By local governments

 133,000 km (82,645 mi)

of roads

 8,000 structures

31 For a complete list of Treasury documents on asset management see http://www.dtf.vic.gov.au/dtf/rwp323.nsf/search/

D62EBFC40F8477C805256A9A00726104?opendocument&Expand=7.2&. 32 See VicRoads, “Road Management Act, Regulations and Codes,” http://www.vicroads.vic.gov.au/vrne/vrne5nav.nsf/childdocs/.
60 | CHAPTER 3

changed this to require due diligence in designing, operating,

and maintaining a road network, and having in place a

process for reducing reasonable risks. A need existed to

provide some legal surety on the level of maintenance

deemed reasonable. This led VicRoads to rely more heavily

on an asset management program to indicate the systematic

process it was following for dealing with road risk. 

The act requires a Register of Public Roads to indicate

agency responsibility for roads in Victoria. The register must

reference where responsibility for a road changes (e.g.,

transfers, delegation, Ministerial Directions, etc.). One result

of this act is that VicRoads and 78 local councils must have

a Road Management Plan consisting of a statement of

responsibility, a road infrastructure management system,

and/or a statement of road maintenance standards. About

80 percent of the local councils have opted for a road 

infrastructure information system. The following language 

in the act indicates the basic components of a local asset

management policy:

“As a minimum, councils need to have an asset management

policy and strategy to provide direction and guidance for

asset management planning. Asset management tactics

translate the broad strategic goals to specific goals and

objectives, generally through the development of asset 

management plans, which provide more detail

and long-term projections. Operations comprise

detailed action plans and information with a one

to three year outlook to provide for the delivery 

of the defined level of service.”

VicRoads’ own Road Management Plan

includes sections on overall policies and

practices for processes relating to road 

infrastructure maintenance, and the 

responsibility of VicRoads road managers 

for road maintenance.33

The scan team noted the issue of nonfeasance

and legal liability for road condition and operation in other Australian states as well. However,

many other states are waiting to see what happens in Victoria with legal challenges and the

role of asset management in demonstrating

due diligence.

Organization for Asset Management

At the state government level, an Infrastructure

Planning Council and an Infrastructure Delivery

Cabinet Committee have been established to

guide the government’s infrastructure policies.

In addition, the government has fostered public-private partnership arrangements through

its Partnerships Victoria initiative (see section

on toll road examples).

“It is fine to have asset management principles, but if you do not have an

asset management mindset incorporated into your agency

procedures and into service contracts, and data to determine what

you are actually doing, you are kidding yourselves.”

—VICROADS OFFICIAL

33 VicRoads, Road Management Plan, Melbourne, VIC, Oct. 2004, see http://www.vicroads.vic.gov.au/vrne/vrne5nav.nsf/

8020?readform=&layout=VicRoads2005%7ESearch&query=Road+Management+Plan.

Figure 31. An integrated perspective of asset management in Victoria.
TRANSPORTATION ASSET MANAGEMENT | 61

VicRoads defines asset management as “a systematic process

of maintaining, upgrading, and operating physical assets costeffectively; which combines engineering principles with sound

business practices and economic theory; that provides tools to

facilitate a more organized, logical approach to decisionmaking; and that offers a framework for handling both short- and

long-range planning.” As several VicRoads officials stated,

however, an asset management approach to business is also

very much an organizational culture issue. 

The road system management group, one of VicRoads’ four

core businesses, is responsible for asset management (the

other core businesses are road safety, traffic and transport

integration, and registration/licensing). About 35 equivalent

full-time staff members are part of VicRoads’ asset management program statewide. A position of manager for asset

management has been created in VicRoads with the following

responsibilities:

 Develop strategies and programs for maintenance.

 Monitor condition of network.

 Recommend maintenance investment levels.

 Benchmark performance.

 Develop, maintain, and support management systems.

 Manage inventory systems.

In the early 1990s, VicRoads adopted a client/provider model

as the major means of program delivery. This meant asset

management strategies (e.g., maintenance) could be delivered

either by private contractors or by VicRoads labor with service

agreements (whichever won the job). Where contracts have

been used, VicRoads has experimented with two types, contracting for a specific function (e.g., resurfacing) in a specific

geographic area, or contracting for a function statewide.

These contracts are performance based, which VicRoads 

officials stated makes an agency-wide asset management

program even more critical.

VicRoads’ commitment to asset management has resulted in

its funding of several research projects (about A$1 million

(US$76,000) a year) on such topics as 1) getting better value

from agency activities, 2) improving useful life from pavement

treatments, 3) understanding network condition, 4) understanding the performance of treatments, and 5) improving the

understanding of risks. 

Figure 32. Many Australian cities are building major new highways by tunneling under the city, making tunnels an

important component of agency and private concessionaire asset management programs.
62

| CHAPTER 3

Figure 33. Road Infrastructure Management System at VicRoads.

Decisionmaking Approach

To a large extent, asset management’s role in

VicRoads’ decisionmaking is closely linked to

the Department of Treasury’s concept of 

“optimal asset management.” This concept

states that this level of asset management 

is achieved by the following:  Defining desired levels of services in consultation with the community, and matching

these with assets that enable the services 

to be delivered

 Adopting a life cycle approach to planning

asset investment and management decisions

 Balancing competing needs across all 

government functions and selecting options

that best meet desired government outcomes

 Monitoring, evaluating, and improving service

delivery

 Managing the risks of asset ownership and

operation to ensure continuity of service

 Providing for present needs while sustaining

resources for future generations

 Adopting a continuous improvement

approach to asset management policies and

practices

Since 2004, VicRoads has used a Road

Infrastructure Management System (RIMS) that

sets out the policies and procedures to achieve

road maintenance standards. RIMS consists of

five phases: developing standards and guidelines, developing a maintenance program,

implementing a maintenance program, auditing,

and reviewing. Figure 33 shows the flow of

decisionmaking in RIMS. 

RIMS targets deficiencies in roads and

bridges through roughness, cracking, and

seal width measures, and maintains the network in a fit-for-purpose condition. This is

done by identifying effective and appropriate

levels of low-cost treatments to avoid the

need for more expensive treatments, and by

applying rehabilitation treatments on roads

road users assess as rough. Road maintenance standards are used to 1) identify

defects with potentially hazardous 

consequences, 2) define the desired 

frequency of inspection, and 3) establish

desired response times. 

Examples of programs that have resulted from

this process include the following:
TRANSPORTATION ASSET MANAGEMENT | 63

Stitch in Time (A$164 million (US$124 million))—A strategy to

deliver safe, user- acceptable, and economically efficient

pavement conditions at the least cost to the community. It is

based on target pavement conditions determined from user

perceptions (pavement roughness for the general community,

and rutting and cracking for road managers) and economic

efficiency. The overall target was to resurface 10 percent of

the network each year, a dramatic change from the 4 percent

average before the program. The current program reaches 8

percent of the network. The program components of Stitch in

Time include the following:

 Routine maintenance (A$41 million (US$31 million))—

A strategy to ensure safe travel conditions and minimize

pavement deterioration.

 Periodic maintenance (A$56 million (US$42 million))—

A strategy to waterproof pavements and defer the need for

rehabilitation.

 Pavement rehabilitation (A$67 million (US$51 million))—

A strategy to minimize whole-of-life pavement costs, 

provide acceptable ride quality, and reduce user costs. 

Victoria’s arterial bridges (A$25 million (US$18.9 million))—

A strategy to rehabilitate bridges.

Roadside management (A$35 million (US$26.4 million))—

A strategy to improve safety and condition of the roadsides.

VicRoads also uses highway management studies to identify

and prioritize improvements on key arterial routes in Victoria.

These studies look at the context of the route, its function and

use, existing conditions, performance on standards, and 

critical transport issues, and make recommendations 

on appropriate strategies.

Asset management is also integrated into agency activities that

link desired performance outcomes to the asset management

framework. Figure 34, for example, shows VicRoads’ Roadside

Management Strategy, which involves several stages:

 Establishing key outcome areas, in this case safety, environmental and cultural heritage values, and amenity/access

 Determining strategic performance objectives, which are

the focus for program delivery as defined by the asset 

management framework

 Assessing risks, balancing competing objectives, and 

determining priorities through the asset management 

system

 Monitoring program delivery against the performance 

management system

 Measuring success by relating program results to stakeholder expectations

Figure 35 (see next page) shows a similar concept for arterial

bridge management in Victoria.

“The hardest thing in asset management is saying,

‘Great job on the 80 percent perfect solution!’”

— VICROADS OFFICIAL IN RESPONSE TO A QUESTION ON HOW ROAD MAINTENANCE

AND REHABILITATION INVESTMENT COMPARES TO NEW CONSTRUCTION

Figure 34. Roadside management framework at VicRoads.
64 | CHAPTER 3

Figure 35. Arterial bridge management and asset management at VicRoads.

Performance Measures

VicRoads conducts standardized analyses to monitor network

performance. For pavements, these include determining the

following:

 Austroads performance indicators of smooth travel 

exposure (STE) on roads less than 110 and less than 

140 national roughness measure (nrm) 

 Road lengths of 500 m (547 yd) with average roughness

over 140 nrm

 Percentage of rutting over 10 mm (0.39 in) and 25 mm 

(0.98 in)

 Surface inspection rating totals for seal and asphalt 

pavements

 Pavement condition using a road rating index (under 

development)

For bridges, analyses include the following:

 Bridge condition using a bridge rating number by road

classification, principal corridors by regions, and by

municipalities.

 Number of inadequate bridges because of higher mass

limits

 Structures with Condition State 3 and/or 4 defects

 Query on bridge type and component number for different

exposure classifications

Figure 36 shows the information produced in VicRoads and

its relationship to corporate reports. Along with other

Australian states, VicRoads has adopted a network condition indicator that is reported nationally to allow comparisons among the states—the Smooth Travel Exposure (STE).

STE is defined as the proportion of travel undertaken each

year on urban or rural roads with surface roughness at 

less-than-desired minimum levels of roughness (4.2 IRI).

Target values are 93 percent of rural roads and 91 

percent of urban roads meeting this threshold, and 

99 percent of arterial roads accessible to legal vehicles. 

The Victorian government has also adopted performance 

indicators for a variety of issues such as public transit patronage, road congestion, and freight modal share to the ports. 

Figure 37 (see next page) is an example of VicRoads’ 

performance indicator monitoring. 

VicRoads’ strategy for managing the performance of bridges

on the arterial system is also based on performance criteria.

This strategy is divided into several themes, some defined 

with asset-related measures. They include the following:

Theme: Carrying 21st Century Vehicles

Performance Criteria

 Number of bridges able to carry higher mass limit vehicles

and 68-metric-ton double trailer trucks

 Number of existing bridges that meet height and width

requirements

 Number of new bridges designed in accordance with the

revised Australian Bridge Design Guide

 Adequacy of structure for flood conditions consistent with

overall route

 Level of ride quality to reduce vehicle operating costs and

adverse impact on structure

Theme: Life Cycle Management of Maximum Benefit

Performance Criteria

 Using the most cost-effective maintenance regimes to

ensure that bridges function satisfactorily for all road users

and do not compromise load-carrying performance

Theme: Ensuring Safety

Performance Criteria

 Bridge width appropriate to traffic volume
TRANSPORTATION ASSET MANAGEMENT | 65

 Desirable minimum-height clearance

 Alignment consistent with safe travel speeds

 Barriers and guardrails maintained in operational condition

For road maintenance, specific standards are established that

act as triggers for maintenance efforts. For pavement rehabilitation, for example, it is expected that between 0.5 to 1.5 percent of the network will receive rehabilitation treatments each

year. Roughness minimum requirement triggers for maintenance activity on different road types include the following:

 3.6 International Roughness Index (IRI) on freeways

IRI on arterials with speeds greater than 80 km/h

 4.6 IRI on arterials with lower speeds

 The results of several years of performance monitoring of

pavement roughness indicates that VicRoads has been 

successful in improving this measure. 

Asset Management Information Systems

VicRoads uses asset data for a variety of purposes. At their

most basic level, data are used to monitor road conditions and

to report on performance indicators. The results of these

efforts are used to develop policies aimed at correcting 

deficiencies and establish maintenance programs and 

targeted rehabilitation efforts. Data are also used to justify

maintenance investment to elected officials and benchmark

VicRoads’ efforts with other Australian states. 

VicRoads uses four primary asset systems to support its asset

management program. A Road Asset System (RAS) provides

basic information on pavement condition and performance,

and retains a history of previous improvements. A Road Crash

Information System (RCIS) includes data on crash records

and road safety history. A traffic database compiles traffic volumes and characteristics. A financial system (PARMS) keeps

track of costs and budgetary items. The systems are linked by

Figure 36. Information reporting hierarchy at VicRoads.

Figure 37. Performance indicator reporting at VicRoads.

Trends in Roughness for all Arterial Roads
a State Road Referencing System (SRRS) so that data can be

combined and referenced at identical locations. 

Data on electrical systems are maintained in a central database that includes traffic signal inventory, phasing plans, 

traffic controllers, closed-circuit TV, incident detection devices,

and street lighting. Maintenance records are also maintained

in this database. 

VicRoads is an international leader in the application of ITS

technologies and has numerous ITS assets to keep in operating condition. The ITS inventory includes details on the asset

(location, warranties, contractor, etc.), record of faults, corrective actions, special operating conditions, performance levels,

and maintenance strategies.

Maintenance records are kept in a various forms, ranging

from hard copy to databases. Selected maintenance treatments are also recorded in VicRoads’ financial system and

uploaded into RAS. VicRoads is reviewing these maintenance

systems and procedures, and expects to restructure and 

centralize them.

Facilities and feature data (guardrails, sign type and location,

and roadside facilities such as rest stops) are kept in a variety

of database modes, including hardcopy records and spreadsheet databases. 

Customer information consists of simply recording road asset

defects identified by the public in a spreadsheet. VicRoads

has developed a functional specification that will be used to

create a more integrated customer information system that

will at a minimum interface with a proposed maintenance 

system. 

Figure 38 shows the direction that VicRoads is heading on an

integrated asset management information system.

Data Collection

Data are collected on a variety of network and travel characteristics, using a range of data-collection tools. The primary

data-collection activities relate to pavements, bridges and

other structures, electrical systems, facilities and features,

road use and performance, and customer information. 

For pavements, video condition surveys are conducted primarily of roughness, cracking, and rutting characteristics for

every 100 meters on the outer lane only. These data are collected annually by private contractors on 50 percent of the

network. A Surface Inspection Rating (SIR) procedure is

used to collect pavement surface data on homogeneous

road sections (seven seal and five asphalt parameters considered). About 33 percent of this network data are collected annually by private contractors. Deflection data for pavement design and skid resistance testing are conducted

using a SCRIM vehicle (see New Zealand case for SCRIM

description). The SCRIM vehicle is used in particular to test

skid resistance at major intersections, where the safety risk

is highest.

For bridges, the Road Asset System has a module that contains inventory and condition data for bridges, culverts, noise

walls, and major gantries. The majority of bridges on the

VicRoads network are subject to a four-level inspection and

associated risk-based ranking system. Inspections consist of

Level 1—routine (6 monthly), Level 2—condition assessment 

(2 to 5 a year), Level 3—structural safety assessment (when

needed), and Level 4—load capacity assessment (on request).

VicRoads has established information technology system and

data management principles to manage data as a resource.

The intent of these principles is to develop a corporate-wide

understanding of road asset information, improve information

accessibility, reduce data management costs, and align data

requirements with business goals and objectives. Guidelines

have been developed for data maintenance to ensure 

integration and reduce duplication and redundancy.

Some of the principles guiding data management involve

assuring data quality. VicRoads has established a rigorous set

of guidelines and processes for assuring high-quality, reliable

data. Historical records, cross verification with data collected

or captured as part of other programs, comparison of treatment data with condition survey data, comparison of condition

survey data with surface inspection data, rigorous specification requirements, and audits of data-collection processes are

used to develop a high-quality database. For Level 2 bridge

inspections, for example, 5 percent of inspected bridges are

independently reinspected. For pavement surface inspection,

10 percent of the surveyed roads are reinspected. 

For contracted data-collection efforts, the contractor’s data

collection and processing are calibrated and validated

before a survey. After completing 3,000 km (2,806 mi) of

data collection, the contractor is required to recalibrate the

vehicle and drivers. Ten sites are selected with a roughness

66 | CHAPTER 3

“Those consuming infrastructure today are

responsible for its replacement.”

— VICROADS OFFICIAL
value range between 20 and 180 counts, with test surfaces

including both chip seals and asphalt pavement. A minimum of five repeat measurements are taken at each site at

nominal speeds of 25, 50, 75, and 100km/h (15.5, 31, 46.6,

and 62 mi/h). Test results are required to meet 1) line of

best fit falling between 0.95 and 1.05, 2) regression offset of

the intercept of line of best fit within –0.25 and +0.25, and

3) an R2 value of at least 0.95. 

VicRoads is experimenting with different automated technologies for data collection. For example, it is using ground

sensors to provide warnings on unstable slopes. It is also

considering using such technologies on structures, as well

as experimenting with advanced nondestructive testing

methods. 

Data-collection schedules for both network condition and

performance are shown in table 7 on page 68.

A recent research project examined community expectations

for asset management in relation to pavements, the roadside

environment, and bridge maintenance. Researchers interviewed stakeholders, conducted focus groups, and conducted

a conjoint analysis that enabled respondents to trade off varying levels of a service delivery within a specific budget level

(see textbox on page 69).

Analysis Procedures and Prioritization

Asset management program priorities are driven by several

key factors, including the following:

 Strategic monitoring/modeling of pavement network 

 Reduction in roughness (ranking of rehabilitation projects)

 Preventive periodic maintenance treatments with priorities

TRANSPORTATION ASSET MANAGEMENT | 67

Figure 38. Targeted road information management system at VicRoads.

Figure 39. Scan team member Lacy Love (left) discusses

use of the SCRIM machine to collect pavement data

with a machine operator.
based on surface inspection (cracking, rutting, age, etc.)

 Resurfacing at sites with low skid resistance

 Bridge condition monitoring and risk assessment

 Roadside inventory

VicRoads uses simple formulas to determine rankings of different types of projects for given budgets. Sensitivity testing is

conducted by changing formula variables. For example, the

following formula is used to score projects on the basis of

skid resistance measures: 

Score = K x V x S

C x SFC

Where: V is volume exposed to hazard

S is speed zone in km/h

C is total estimated cost of the project

SFC is sideways force coefficient

K is:

—3.0 for light-controlled intersections, school 

crossings, railway crossings, and roundabout 

approaches

—2.5 for curves with radius < 250 meters and 

freeway on- and off-ramps

—2.0 for intersections other than those above

—1.5 for maneuver-free areas of undivided roads

—1.0 for maneuver-free areas of divided roads

For conventional rehabilitation projects, the following formula is used:

68 | CHAPTER 3

Table 7. VicRoads’ data-collection strategy for network condition and performance.

Network Condition Surveys

Survey Type Survey Method Frequency Supplier

Pavement Condition—

roughness, rutting, cracking, texture,

road geometry, video

Automated collection for roughness,

rutting, and texture

Cracking is visual inspection using high

resolution video

Video imagery of network is collected at the

same time as the condition data

50% of network

per year

(12,000 km

or 7,457 mi)

Contract

Surface Inspection

Visual inspection of road 

VicRoads provides the software application

to record data in the field

About 33% of network

per year 

(8,000 km or 4,971 mi)

Contract

Level 2 Bridge Inspections—

length, width, structure components,

construction type, construction

materials, construction date,

maintenance treatments and dates

Condition data collected based on

a modified PONTIS system

Level 3 condition inspection information

About 25% of

structures per year Contract

Level 3 Bridge Inspections Visual and measurement survey As identified by

Level 2 inspection

Contract

and internal

resources

Network Performance Surveys

Traffic Volume and

Classification Data 

Observation,automatic

classification counters

Traffic signal equipment

Rural—480 

strategic sites

60% contract

40% internal

Metropolitan

Melbourne

80% contract

20% internal 

Travel Time Floating vehicle

Melbourne area

100% of freeways

twice a year

15% of arterial network

twice a year

Contract
Rehabilitation project score = R*T*L*D/C

Where: R is % roughness > target level (capped at 70%)

T is traffic volume

L is life of treatment

D is rate of deterioration

C is unit cost of treatment

For rural high-speed roads, VicRoads uses the following formula to determine rehabilitation priorities for freight-related

projects:

Rehabilitation project score = Rfreight * AI * T * L / C

Where: Rfreight is % of sections where the difference in 

roughness is greater than 1.5 IRI

AI is the average roughness of the section being 

treated in IRI derived from the last two roughness 

surveys

T is the traffic volume (up to a maximum of 2,000 

vehicles per day (vpd) rural)

C is the unit cost of treatment ($ per m2)

L is the expected treatment life (years)

VicRoads has a social equity formula that gives the highest

priority to roads where 30 percent or more of the individual

length to be treated has an average roughness greater than

110 nrm and traffic volumes are less than 500 vpd. Social

equity in this case means making sure that low-volume roads

do not deteriorate to unacceptable levels simply because they

can never reach a volume threshold. The ranking formula for

social equity projects is as follows:

Rehabilitation project score = Rimprovement * D * T * L / C

Where: Rimprovement is improvement in roughness from the 

current value to the estimated final roughness. 

D is the rate of change of roughness derived from 

three successive roughness surveys that have been 

aligned, but limited to between 1 and 5.

T is the traffic volume (up to a maximum of 500 

vpd rural)

C is the unit cost of treatment ($ per m2)

L is the expected treatment life (years)

VicRoads officials expressed a word of caution about using

such formulas. Once those responsible for obtaining maintenance budgets for their district or region know what is in the

formula, the formula can be gamed and the data manipulated

to show a greater need than actually exists.

TRANSPORTATION ASSET MANAGEMENT | 69

Public Preferences on

Maintenance Priorities

VicRoads conducted a conjoint analysis to 

determine public preferences among different

maintenance strategies.A total of 360 interviews

were conducted in Melbourne of a representative 

sample of the population. Participants were asked 

to trade off sums of money among four different 

maintenance strategies:

 Road surface (pavement) long-term maintenance

 Road surface routine maintenance

 Roadside maintenance

 Bridge maintenance

Four distinct responses were obtained.About 33 percent

of respondents favored increased funding for long-term

pavement maintenance, 28 percent favored increased

funding for routine maintenance at the expense of other

strategies, 19 percent favored both increased routine

pavement maintenance and increased roadside maintenance, and 19 percent favored increased routine pavement maintenance and increased bridge maintenance.

Turning these desires into utilities for each class of expenditure suggested to VicRoads that an optimum expenditure (from the community’s perspective) would be $1

million less on periodic pavement maintenance, $3 million less on roadside maintenance, $2 million less on

bridge maintenance, and $6 million more on routine

pavement maintenance.

For pavement maintenance, respondents preferred expenditures on filling potholes and cracks over other strategies. For roadside maintenance, the top preference was

maintenance on signs, guardrails, and footpaths.This was

followed by grass mowing and guardrail upgrades.

Fifty-five percent of respondents said that Victoria spends

“about the right amount”on road maintenance, 42 percent said it did not spend enough, and 2 percent said it

spends too much.

“It is not appropriate for accounting practices (Australian Accounting

Standards) to dictate asset management outcomes.”

— DEPARTMENT FOR VICTORIAN COMMUNITIES, 2003
Numerous project characteristics are considered when bridge

projects are prioritized. These include the strategic importance

of the route, functioning of the bridge for all users, freight volume, condition and rate of deterioration, capacity and performance, availability of alternative routes, assessed risks,

feedback from users and local communities, cost-benefit

ratios, and fit with other strategies and business plans. Asset

management is an important part of the process of establishing priorities and is based on a risk management approach.

This means projects are assessed in light of competing

demands for resources, an understanding of the consequences of not investing in the project, and a prioritized program created to obtain a balanced allocation across all asset

needs.

For maintenance, VicRoads’ Road Management Plan outlines

the process for developing a program. The first step is to conduct a gaps analysis, which entails comparing the latest road

condition surveys to maintenance standards and performance

targets. A network-level analysis is then conducted to identify

appropriate types of strategies that can be applied on the network to fill these gaps. The next step is to develop initial maintenance program targets that reflect likely funding and any

changes in road management strategies. The final step is to

prepare the maintenance program, which gives priority to routine maintenance, followed by periodic maintenance and

rehabilitation. VicRoads’ pavement management system provides input into this analysis process. 

Roadside maintenance projects are prioritized by first meeting

statutory responsibilities, then preserving the integrity of the

roadside, and finally meeting environmental goals. VicRoads

has experimented with pavement deterioration models (dTIMS

and HDM-4) in examining combinations of strategic investment and system use scenarios. These experiments were conducted primarily in regional offices to develop regional investment programs. The results of these efforts suggested that

the scenario analysis application in the regional offices was

time consuming, complex, and difficult to understand. Thus,

these tools are now used primarily in the central office as a

strategic tool for examining network-level trends. 

VicRoads also conducts benchmark studies to compare its

program to other Australian states, as well as to examine differences in productivity with different models of service delivery. For example, a comparison was done between contract

maintenance versus work done with its own commercialized

maintenance group. Costs appeared to be cheaper initially for

contract maintenance, but have gone up in recent years. In

addition, quality of service could not be benchmarked,

although there is a perception that the quality of service is not

as good as that provided by VicRoads staff (this could not be

verified independently during the scan team’s study). 

Public-Private Partnerships and Asset Management

The Victoria government has participated in two major publicprivate partnerships (PPP) for toll roads over the past 10 years.

The experience with these initiatives has been most instructive

to the responsible authorities, especially on the role and use

of asset management principles and tools in the concessionaire’s day-to-day activities. 

The first PPP project in Melbourne, the CityLink project, consisted of 19.3 km (12 mi) of new urban freeways including

tunnels, elevated roads, and bridges. It was constructed from

1996 to 2000 for A$2.2 billion (US$1.7 billion). Fully dependent

on electronic tolling (transponder and video imaging), the

CityLink project generates about A$250 million (US$189 million) a year. A concessionaire won the bid to construct, operate, and maintain this project for 34 years. There are more

than 950,000 registered e-TAG users, with 750,000 daily transactions. Toll violations are less than 1 percent of daily users. 

This project consists of a variety of infrastructure assets, many

with very different life cycle characteristics. For example,

structural assets have long lives (often 30 years plus),

mechanical and electrical systems usually fall into the 10-to30-year useful life range, and electronic tolling instrumentation has a fairly short useful life, from 3 to 10 years. CityLink

estimates that 50 percent of the total life cycle costs of the

project are related to repair and maintenance. 

CityLink is organized into several divisions or groups, one of

which—the Infrastructure Group—is responsible for the

owner’s (Victoria’s) interests and for monitoring performance.

These interests were defined as providing travel-time benefits,

reliability, and a better road; producing a showpiece asset;

maintaining sustained asset performance; assuring an acceptable return on asset investment; assuring safety for users,

staff, and contractors; and complying with governance, corporate, and social responsibility mandates. Operations and maintenance activities are outsourced, with about A$20 million

(US$15.1 million) spent for both (40 percent for operations

and 60 percent for maintenance).

The concessionaire’s deed mandates certain maintenance

requirements, such as maintaining and repairing promptly,

reporting to VicRoads, and responding to notifications of

maintenance deficiencies. Maintenance standards are specified for pavements, road markings, lighting, signs, and landscape. The concessionaire is also responsible for meeting

handover requirements on facility condition when the road is

turned over to VicRoads at the end of the concession deed.

For example, the following hand-back conditions illustrate the

type of asset requirements that were in the concession deed:

 Bridge and tunnels—remaining structural life = at least 80

years at hand back

70 | CHAPTER 3
 Road pavement—remaining structural life = 20 years average at hand back

 Road surface—remaining operational life = 5 years average

at hand back

 Major electrical/mechanical—remaining operational life = 

20 years minimum at hand back

 Tunnel finishes—remaining operational life = 50 percent of

product life at hand back

 Communications and control systems—remaining operational life = 10 years at hand back

 Renewable items—reasonable life at hand back, not less

than 50 percent of operational life as agreed with the state

A maintenance plan was part of the concession bid, as was a

requirement to show how maintenance management would

be undertaken. In the case of CityLink, a computerized maintenance management system (CMMS) was proposed to guide

maintenance planning and work allocations, report defects,

provide quality assurance reporting, and act as a

stores/spares inventory system. Even with these maintenance

requirements, the original bid specifications said little about

asset management.

To meet the technical requirements and still achieve a desired

return on investment over the life of the project, the concessionaire developed a business plan based on risk management. The approach identified the most critical risks to meeting the concession agreement’s requirements, designing out

defects and inherent faults, replacing worn or troublesome

assets that continually fail or cause problems, replacing assets

that reduce risk and improve infrastructure investment,

replacing assets that are energy inefficient or environmentally

unfriendly, and ensuring compliance to

the concession deed including meeting

specified hand-back requirements. One

issue CityLink faced early on was a

major failure of a concrete slab in a

tunnel because of water filtration.

Because the concessionaire accepted

facility responsibility as built, the cost of

fixing this failure produced a deficit of

A$200 million (US$151 million) to the

concessionaire at the very beginning of

revenue service. 

CityLink is now focusing on businesscritical systems. According to CityLink

officials, the asset management lessons

learned from their initial experience

with this project include the following:

1) design out defects and faults as

much as they are known in the design

phase, 2) reduce risk wherever possible, 3) reduce energy consumption, 4) maintain the facility as

an evergreen site (that is, do preventive maintenance), and 5)

replace troublesome assets as soon as possible. Figures 40

and 41 show how asset management concepts have been

incorporated into the business operations of CityLink.

Transportation officials learned a great deal from the CityLink

experience, especially about asset management. The most

recent PPP project, called EastLink, incorporated asset management requirements more comprehensively in the initial bid

requirements. The EastLink project consists of 45 km (28 mi)

of freeways (39 km (24 mi) tolled) with twin 1.5-km (0.9-mile),

three-lane tunnels. The project has a long history of controversy and public discourse, ending up with substantial commitments to environmental mitigation, which were incorporated into the project costs (and, in the process, extending the

concession time frame to 38 years to recover these additional

costs). Unlike CityLink, a special authority called the Southern

and Eastern Integrated Transport Authority (SEITA) was established to oversee this US$2 billion project. 

EastLink consists of 17 interchanges, 103 structures (86

bridges), 3 railway crossings, 7 million m3 (9.2 yd3

) of earthworks, 2 million m2 (2.4 million yd2

) of pavement (asphalt),

150,000 m2 (179,000 yd2) of noise wall face, and 4.7 million

plants. Similar to CityLink, the concession assigned risks to

several characteristics of the project. The concessionaire was

required to maintain, operate, and promptly repair; minimize

disruption; and use best practice and continuous improvement strategies. Condition inspections and a requirement of

no defects were incorporated into the handover specifications.

The concessionaire was required to report residual design life

TRANSPORTATION ASSET MANAGEMENT | 71

Figure 40. Asset management approach for toll roads in Melbourne.
for key assets, and had maintenance obligations for 1) routine

maintenance, 2) planned refurbishment, 3) unplanned intervention and repair, 4) inspections, 5) an asset management

system and adopted code of maintenance standards, and 6)

keeping records and meeting reporting schedules. For operations and maintenance, performance-based terms and conditions were incorporated into the deed. The deed includes for

all assets an extensive code of maintenance standards that

must be achieved during the life of the concession.

A bid bond of A$10 million (US$7.5 million) was required for

the bid phase, an A$87.5 million (US$66.1 million) bond for the

construction phase, and an A$5 million (US$3.8 million) bond

building to A$20 million (US$15.1 million) with increasing volumes for the operations phase. A hand-back bond is required

that will be agreed to 3 years before the road being is turned

back to VicRoads. 

The concessionaire must report on a performance indicator

regime relating to several performance categories—customer

service, road condition, landscaping and features, tolling

accuracy, and environmental quality. A monthly scoresheet

and a quarterly report on key performance measures are submitted to SEITA. In the event of noncompliance, an A$15 million (US$11.3 million) credit could be provided to road users. 

Observations

Several aspects of the VicRoads’ experience with asset management are noteworthy. The first relates to the recent change

in legal nonfeasance that has spurred greater interest in

developing a defensible decisionmaking process that the

courts would consider reasonable. This legislative change has

resulted in activities not only at the state level, but also at the

local government level. The fact that more than 60 local 

governments have opted to have a road information system in

place as part of their “reasonable decisionmaking process”

gives an indication of the importance liability has in 

motivating greater concern for asset management.

Victoria, similar to other Australian states, has given much

thought to the relationship between performance measures

and their role in different levels of decisionmaking in the

transportation agency. Performance measures influence

everything from strategic decisions to day-to-day maintenance. This consistency in focus provides an important

capability showing compatibility with service outcomes and

government policies and goals.

Of all the sites visited, VicRoads was probably the most 

interested in advancing the state of practice in data-collection

technologies. Not only has VicRoads adopted high-speed

data-collection capabilities, but it is experimenting with smart

technologies for collecting data on difficult asset types (e.g.,

slopes) or in remote locations.

VicRoads has developed several quantitative approaches 

(formulas) to identify priorities among different maintenance

strategies. Only in New Zealand did the scan team observe

anything similar. In particular, the team noted that the maintenance rankings included projects oriented toward freight

72 | CHAPTER 3

Figure 41. Asset management tools for toll roads in Melbourne.
roads and social equity. Although the use of formulas

appeared to provide some rigor to the prioritization of work

activities, it was noted that the potential for gaming of the 

formula could lead to inefficient budget allocations. 

One of the most interesting observations in Victoria related to

the role of asset management in PPP projects. Because

Victoria has had several years of experience with PPP projects,

lessons learned from this experience can be important for

others contemplating this direction for infrastructure investment. Put simply, great care should be given to making sure

that the concessionaire becomes committed to asset management as part of the business decisionmaking process. The

first project in Melbourne did not include asset management

in its specifications as much as the second project has. This

was the direct result of the learning process that transport

officials went through in both projects.

TRANSPORTATION ASSET MANAGEMENT | 73
74 | CHAPTER 3
of little or no progress in

solving transportation problem, and aging of the infrastructure have led city officials to consider innovative

funding strategies and develop a comprehensive asset 

management approach 

to city assets. 

Drivers for Asset

Management

Several factors have led

Brisbane officials to embrace

asset management as part

of their stewardship of city

resources. First, as noted in the Queensland case, state government has adopted asset management principles as part

of its basic approach to infrastructure provision, and has

expected (and for some activities required) local authorities

to do the same. Second, Brisbane is proud of its innovative

and cutting-edge image among Australian and world cities.

Indeed, Brisbane actively markets many of its services to

other cities as part of its governmental business plan. 

The asset management approach in Brisbane, which has

received national awards, is part of the general philosophy

of governmental stewardship of city resources. It is viewed

as a natural evolution toward effective and efficient 

provision of services. 

The defined purposes of asset management in Brisbane 

perhaps best explain this philosophy and the driving influence

behind its adoption in city government. According to city 

officials, asset management does the following:

 Provides a strategic direction and corporately consistent

planning framework for the city’s physical asset and 

property management

 Ensures that facilities and assets are adequate to

meet assessed needs (community service

expectations)

 Improves use of the City Council’s asset portfolio

 Optimizes preservation of all retained assets at the lowest

life cycle cost

TRANSPORTATION ASSET MANAGEMENT | 75

Chapter 4:

Local Experience With

Asset Management

Three of the sites visited represented

asset management experience at the local government level.

Such governments, more than those at other levels, have

many types of assets to care for, so the scan team was particularly interested in learning how tradeoffs were made among

these different categories, if at all. Three local government

experiences with asset management included those for

Brisbane, Edmonton, and London.

BRISBANE, QUEENSLAND,AUSTRALIA

www.brisbane.qld.gov.au

Context

With a population close to 900,000 and an area of 1,327 km2

(512 mi2), Brisbane is the largest local government authority in

Australia. As such, it is responsible for providing a large number of public services, ranging from water and sewerage to

public transit. Not surprisingly, the Brisbane City Council considers infrastructure delivery and asset management one of its

major responsibilities. Since 1994, given the growth in population, the amount of paved road surface (measured in square

meters) has grown 2.4 percent per year. With Brisbane expected to be one of the fastest-growing cities in Australia in the

next several decades, road surface and public transit infrastructure are likely to continue to grow at a fast rate. 

Brisbane’s transportation plan emphasizes not only efficient

management of the road network, but also renewed investment in public transportation and the use of demand management strategies to reduce transport demand. Similar to

other Australian cities, Brisbane is placing greater emphasis

on tolls or user charges for major investments in the transportation network. The preferred model is privately owned

toll roads under a 30-year franchise. If a suitable project

offer does not emerge from the tender process, the proposed ownership model is reviewed. An example of a proposed public-private partnership is TransApex, a plan for

major investment in new river crossings, connecting major

arterials with new roads and tunnels, and enhancing public

transportation services developed in response to several

transportation challenges facing Brisbane. Increasing congestion, limited general revenue funding, public perceptions

Transportation

Infrastructure

Managed

 5,400 km (3,355 mi) of roads

 803 traffic signals

 230 road bridges/414 path

bridges

 906 culverts

 5 tunnels

 690 buses

 0 ferries/25 ferry terminals

BRISBANE,

QUEENSLAND,

AUSTRALIA

EDMONTON,

ALBERTA, CANADA

LONDON,

ENGLAND
 Identifies surplus assets and maximizes the return, in both

revenue and benefit, from the disposal process

In essence, asset management is considered part of good

government. Finally, officials pointed to the rapid growth in

population and employment as strains on the city’s infrastructure and budgets. Asset management was viewed as a

way to provide the best value in infrastructure improvement

for the limited funds available.

Organization for Asset Management

Brisbane created an asset steering committee in 1998 under

the direction of the mayor and other top division managers

that coordinates the provision and preservation of infrastructure in the city. About 10 people serve on this committee, including the key asset management officials in four

major city divisions—urban management, community and

economic development, city governance, and information

technology. According to Brisbane officials, the focus of this

committee has evolved from asset management as a financial accounting technique to asset management as a stewardship strategy.

The Transport and Traffic Program in city government is

responsible for the road network, and is a major player in

the city’s asset management program.

Decisionmaking Approach

The adopted vision for Brisbane’s asset management effort

is “enhancing community outcomes through excellence in

physical asset management.” According to this vision,

expected to be accomplished by 2010, the city’s assets will

1) be financially, environmentally, and socially sustainable,

and 2) enable the delivery of agreed-on services at optimal

cost. The vision statement also says that “in 2010,

Brisbane’s asset management will be a paragon for local

government throughout the region and the world; and be

innovative, collaborative, flexible and fully integrated with

other city functions.” The strategy on how Brisbane plans to

develop this asset management approach shows quite well

how asset management links to decisionmaking. The

themes associated with the steps in this strategy include

the following:

Step 1: The community is a key stakeholder and valued

participant in strategic decisionmaking. Involvement will

occur by educating, collaborating, building relationships,

and formulating a community plan for asset management.

Step 2: Asset management solutions are based on a bestfor-region approach. The city will continue to work with a

Southeast Queensland working group on infrastructure

coordination, help develop a regional asset management

plan (especially for shared services), and use a whole-ofgovernment approach. 

Step 3: Asset strategic plans provide a reliable basis for

effective planning and service delivery. An integrated

approach for related assets will be developed with 

stakeholder participation. Scenario planning will examine

service-level tradeoffs.

Step 4: Agreed service standards define the composition of

the asset portfolio. This might entail looking at just-in-time

asset creation, flexible assets, nonasset solutions, and ownership options.

Step 5: Financial, environmental, and social responsibility

will be the foundation of asset management. Stable funding,

positive environmental impacts, and assets that help build

social capital will be major objectives of the management

approach.

Step 6: Enhanced organizational capability is critical for

successful asset management. This will entail appropriate

assignment of responsibilities, the most efficient arrangements for asset management, and assumed leadership.

Step 7: High-quality outcomes will be achieved in an environment of continuous improvement. Basic characteristics

of achievement will include quality assurance efforts,

research and development, improved skills and manager

knowledge, and public-private partnerships.

Step 8: An asset management program will be streamlined,

cost effective, and based on a low-risk information

support network. This will require clear organizational

rules, accessible and complete information, and integrated

support systems. Infrastructure provision, preservation,

and maintenance decisions are strongly founded on

several plans developed to guide these decisions 

(see figure 42). 

Asset strategic plans have been developed for all major

asset classes, varying in time horizons depending on the

useful life of the asset. Information technologies, for 

example, have very short time horizons, while road pavement surfacing is assumed to last between 10 to 20 years

and bridges more than 100 years. The asset management

plan for roads and streets is typical of how these plans are

organized and the types of information needed to support

decisionmaking. The asset management plan includes 

sections on levels of service, future demand, condition

assessment, life cycle management, asset risk management,

a financial summary, asset management practices, and 

plan improvement/monitoring. 

76 | CHAPTER 4
TRANSPORTATION ASSET MANAGEMENT | 77

The table of contents for the traffic signals and electronic

control devices asset management plan provides another

illustration of what is included in such a plan. The plan is

organized in the following manner:

 INTRODUCTION

— Background 

• Purpose of the plan

• Asset included in the plan

• Relationship with other planning documents

• Key stakeholders in the plan

• Organization structure

— Goals and objectives of ownership 

— Plan framework

 LEVELS OF SERVICE

— Customer research and expectation

— Legislative requirements 

— Strategic and Corporate goals 

— Current levels of service 

— Desired level of service 

 FUTURE DEMAND

— Demand forecast 

— Changes in technology

— Demand management plan 

 LIFE CYCLE MANAGEMENT PLAN

— Background data

• Physical parameters 

• Asset conditions 

• Asset valuations 

— Routine asset maintenance

— Renewal replacement plan 

— Asset creation 

— Asset disposal 

 ASSET RISK MANAGEMENT

 FINANCIAL SUMMARY

— Financial statements and projections

• Maintenance 

• Renewal 

• Capital 

• Valuations 

 ASSET MANAGEMENT PRACTICES

— Accounting/financial systems

— Asset management systems 

 PLAN IMPROVEMENT AND MONITORING

— Improvements

— Monitoring

Figure 42. Asset management model in Brisbane.
78 | CHAPTER 4

The 10-year asset management plans are part of the strategic-planning process and focus on operations, maintenance,

and rehabilitation needs. Key considerations in the plans

(described as key challenges in any asset management effort)

included the consideration of desired-versus-actual 

(measured) standards of service, how to reduce the level of

backlog, planned-versus-reactive maintenance, how to anticipate growth in demand and unit costs, changes in technology,

and alternative service delivery options (i.e., demand management). Asset needs are matched to city infrastructure 

strategies, which are to invest, maintain, or divest.34

The importance of having an asset management plan to 

support decisionmaking was illustrated in a recent example

where the City Council rejected a requested budget for city

traffic signals maintenance because a strategic asset 

management plan for signals did not exist.

Performance Measures

Road infrastructure managers monitor measures of pavement

condition and quality. In addition, given the challenges of

growing transportation demand, they monitor and report

measures relating to congestion/delay and public transportation system performance. The annual report of the Transport

and Traffic Program to the City Council best indicates the

asset management-related performance measures that 

elected officials consider most important:

 Amount of road pavement resurfaced

 Amount of improved or reconstructed footpaths and 

bikeways

 Number of upgraded storm water gullies

 Tons of asphalt manufactured at city sites

 Number of service agreements with internal suppliers and

customers to ensure value for money and 

best-for-Brisbane outcomes

34 One issue the city council faces is a recent recommendation from a management consultant to divest its fleet resources and three other asset

groups.

“We have evolved away from a focus on financial accounting to

a more central role for asset management.” 

—BRISBANE CITY OFFICIAL

Figure 43. Rutting and roughness data for Brisbane.
TRANSPORTATION ASSET MANAGEMENT | 79

Figure 44. Asset management systems in Brisbane.

Brisbane’s South East Busway

The Queensland government decided in 1996 to

plan a busway network for the Brisbane metropolitan

area.The first part of the network, the South East

Busway that opened in 2000, now extends for 16.5 km

(10.3 mi), with a planned overall length of 72 km (45 mi).

Brisbane Transport operates many of the bus services on

the busway, with a 2- to 3-minute headway during peak

periods and 7- to 8-minute headways during offpeak periods. On an average day, about 3,300 bus trips occur on the

busway, serving just over 60,000 passengers.The government viewed the busway as a showcase for the application

of ITS technologies, both for vehicle operations and passenger information.The control center houses staff from

Brisbane Transport, Main Roads, and police agencies.

Queensland Transport has had responsibility for the 

maintenance and capital renewal of the busway, but it 

has agreed to transfer this responsibility to Main Roads

because of its experience in maintaining roads. Queensland

has entered into a level-of-service agreement with Main

Roads that will provide a ride quality and pavement condition equal to the best motorway under its jurisdiction.

However, maintenance and upgrading of ITS technologies

will remain with the transit agency because transit officials

believe they have a better understanding of the service

needs of the technology applications.

 Percentage of customer satisfaction

 Number of lost-time injuries 

Given the concern about congestion and public transportation, other measures relating to road level of service

and transit ridership are also reported.

Brisbane City Council tested other performance measures to see if they would be more appropriate than

what is used now. Figure 43, for example, shows

results of a survey of major roads to determine if rutting and roughness data provided better decisionmaking information. It was concluded that they were

appropriate at a project diagnostic level, but not at a

programmatic level.

Brisbane officials also identified bridge durability and

heritage designation as important concerns for those

involved with structures.

Asset Management Information Systems

The foundation for Brisbane’s transportation asset

management program is the Total Asset Management

(TAM) system (see figure 44), based on 16 classes of

assets. The TAM framework, available on Brisbane’s

Web site, is an asset planning tool that can examine

asset performance over variable time horizons, 

including annually, 10-plus years, and 30-plus years.

TAM supports decisions on capital investment 
planning, strategic and operational planning, maintenance

planning, and disposal planning. According to Brisbane 

officials, top elected officials are very interested in 

TAM and how it leads to the most cost-effective budget

decisions for the city. As a result, TAM has a lot of 

political support for its use.

According to city guidelines, TAM should provide several

functionalities in its role as a decision support system. 

In particular, it should do the following:

 Be based on life cycle costing

 Provide basic information management

 Allow users to conduct value management

 Include the capability to examine demand-management

strategies

 Provide risk management analysis

 Provide economic appraisal capabilities

 Allow asset accounting 

 Provide functional assessment capabilities

 Feed into performance measurement

 Keep track of heritage assessments

 Link to environmental management processes

 Conduct condition assessment 

The value of pavement is determined through the use of the

pavement management system, which uses a condition-based

methodology, while all other assets use a straight-line 

depreciation approach. 

Data Collection

Brisbane has developed a pavement classification system

manual that defines the approach for collecting data on

80 | CHAPTER 4

Figure 45. Scenario analysis in Brisbane.
TRANSPORTATION ASSET MANAGEMENT | 81

roads, medians, curbs, and footpaths. The data collection

strategy uses primarily visual observation to collect data on

surface condition. Three teams of two people each collect

data on the entire system, usually taking about 4 years to

complete the entire road network. Data are collected on

major roads every 2 to 3 years and on residential roads

every 3 to 5 years.

Analysis Procedures and Prioritization

The asset management approach in Brisbane is based on

whole-of-life costing with special attention given to 

asset durability. The asset preservation program, which 

includes maintenance and rehabilitation options, is 

based on standards of service, expected future needs, 

and identification of risk. Pavement degradation curves 

calibrated to Brisbane data are used to determine future

condition. Risk assessment and comparing current asset

condition to engineering standards are the primary 

means of identifying priorities.

A pavement management system is used to conduct scenario

analysis on such policy questions as the following: What is the

condition of the road network if the city continues spending at

existing funding levels? What amount of funding is necessary

if the city wants to maintain today’s network condition? Figure

45 illustrates this scenario approach. This figure shows what

would happen if 2005/2006 funding levels were continued 

for 10 years. Network condition (denoted on the y-axis as 

percentage of pavement network area over intervention 

standard) not unexpectedly would deteriorate. 

This scenario approach was used to develop a 4-year funding

program for operations, maintenance, and rehabilitation

requirements for all of the city’s assets. Assets were considered by class, and funding categories for operations, maintenance, and rehabilitation were defined. This was the first time

maintenance and rehabilitation had been included in such an

analysis as separate funding categories. In the final analysis,

funding for transportation and traffic had the highest budget

allocation, A$229 million (US$173 million) out of a proposed

A$593 million (US$448 million) budget.

Some of the issues faced in this analysis were typical of those

found elsewhere. They included considering desired levels of

service versus actual levels of service, defining the magnitude

of maintenance backlog, estimating planned versus reactive

maintenance, considering changes in technology, and 

identifying alternative service delivery options and the costs

associated with them.

To value Brisbane’s pavement assets, the concepts of useful

life, remaining life, replacement cost, and depreciation are

used. The estimated replacement cost of the road network is

A$2.47 billion (US$1.87 billion). Budget recommendations are

based on life cycle cost projections.

The types of atypical road asset management strategies 

considered as part of the city’s program include improving

asphalt-laying tolerances, developing advanced asphalt

mixes, implementing alternative rehabilitation methodologies, improving materials and techniques, developing 

alternative uses for road pavement, developing lightemitting strips, and using fiber-reinforced concrete 

curb and channel.

Observations

Brisbane is a good example of a fast-growing city that gives

attention not only to expansion of the transportation network

(which it is doing in a dramatic and impressive way), but also

to preserving the massive investment that has already

occurred in the transportation system. Its award-winning total

asset management (TAM) approach has laid the groundwork

Figure 46. Brisbane has devoted considerable resources to

an asset management program for its sidewalks.
82 | CHAPTER 4

Figure 47. Portrayal of the extent of the infrastructure challenge in Brisbane.

for making the most cost-effective

decisions possible given budget

constraints. Several aspects of the

asset management approach in

Brisbane are noteworthy. 

Asset strategic plans have been

prepared for all asset categories.

These plans have not only laid 

out the technical aspects of asset 

management for each type of

asset, but they have also become

important decision-support 

tools—a good example being the

Brisbane City Council’s refusal 

to pass a budget request for 

traffic signals because no signal

asset management plan existed.

These plans are an important 

part of the institutional decisionmaking process and guide technical analysis and prioritization.

Brisbane’s asset management 

program leads to a process of prioritization based on tradeoff analysis.

This analysis relies on risk assessments and deficiency analysis for

desired levels of service. Although

still in its infancy, the approach

Brisbane adopted appears to 

provide sufficient information for

city officials to determine the right

mix of investment across all of its

assets. In particular, the approach

has promoted the importance of

assets that often do not receive

much attention, such as signs, 

signals, and markings, or what was

called the “winks-and-blinks”

appurtenances. The credence of

this approach is enhanced by 

having an asset steering committee

that provides overall guidance to

this process.

Given the very public process of

transportation planning in Brisbane,

city officials have structured the

asset management program to be

informed by public input. Public

presentations and focus groups

have been used to seek input from
the public on its desires on system condition and 

performance.

Similar to Edmonton (see next case), Brisbane has thought

carefully about how to portray asset management issues in an

easy-to-understand manner. Brisbane staff used figure 47, for

example, to convey to elected officials and the general public

the extent of the infrastructure challenge facing the city. If

nothing else, the equivalent straight line kilometer-tokilometer extent of Brisbane’s road and storm water network

conveys the scale of the asset stewardship challenge. 

EDMONTON,ALBERTA, CANADA

www.edmonton.ca

Context

The city of Edmonton, Alberta’s capital, has just over 700,000

people in a metropolitan area of about 1 million. Strategically

located to serve the natural resources industry, Edmonton is

expected to capture a large share of future investment in the

province. For example, Can$13 billion (US$10.4 billion) of the

Can$100 billion (US$80 billion) in construction announced or

underway in the province is occurring in Edmonton. Growth

in population and employment is expected to place tremendous pressure on the 12 asset areas for which the city is

responsible.

Edmonton defines the replacement value of its assets as the

cost of infrastructure if it were replaced in today’s dollars

(estimated at Can$19.2 billion (US$15.4 billion)). The secondlargest component of this estimate is transportation and

streets, with a nearly Can$7.5 billion (US$6 billion) replacement value. 

Roads constitute 38 percent of the city’s total unfunded

needs. About 60 percent of the road investment 

(Can$311 million (US$235 million)) and 54 percent of the

transit investment (Can$123 million (US$93 million)) are 

targeted at maintenance and rehabilitation needs. Major

funding sources for transportation include debt, tax 

levies, a provincial fuel tax (5 cents/liter—one of the few 

in Canada), and developer fees. 

According to officials, the critical issues facing the city’s 

transportation system include a significant backlog of 

necessary work and inadequate funding. The overall physical 

condition of transportation infrastructure is considered fair,

but problems exist in collector and residential roads 

(in mature neighborhoods), alleys (in mature neighborhoods), street lighting, traffic signals, traffic signs, the 

light rail transit (LRT) fleet, bus terminals, transit farecollection equipment, and transit bus and LRT 

communications equipment.

Of interest to this scan, Edmonton’s experience in asset 

planning and management led to the development of

Canada’s National Guide to Sustainable Infrastructure

(InfraGuide) Best Practice on “Managing Infrastructure Assets.”

35 In addition, Edmonton has played a lead role in the 

development of InfraGuide’s new Managing Infrastructure

Assets Knowledge Product, released in June 2005.

Drivers for Asset Management

Edmonton’s adopted Infrastructure Strategy (1998) was based

on a goal of ensuring that Edmonton's infrastructure is “in a

good state of repair, and rehabilitation and development programs are adequately funded on an ongoing basis, and are as

efficient and effective as possible.”36 This strategy was founded

on concerns over many years of

deferred maintenance caused

primarily by an economic downturn and corresponding funding

shortfalls. 

Edmonton officials noted the 

following major drivers for asset

management: 

 Need to optimize investment

decisions in light of significant

funding shortfalls

 Need to quantify asset value

and operational status of the

infrastructure

 Need to demonstrate clearly

the linkage between funding

and service levels to the city

council

 Need for a mechanism 

to compare investments between different asset classes

 Need for a mechanism to compare investment products

between growth and investment infrastructure

City officials described these drivers in general terms as 

leading to Edmonton becoming a “knowledgeable owner.”

TRANSPORTATION ASSET MANAGEMENT | 83

Transportation

Infrastructure

Managed

 4,395 km (2,731 mi) 

of paved road

 142 bridges/culverts

 4,334 km (2,693 mi) 

of sidewalks

 69,000 streetlights

 822 traffic signals

 123,000 traffic signs

 19,526 posts/bollards

 3,370 parking meters

 757 diesel buses/37 light 

rail vehicles/63 trolleys

 10 light rail transit stations

35 See www.infraguide.ca. 36 City of Edmonton, Thinking Outside the Gap, Opportunities to Address Edmonton’s Infrastructure Needs, Infrastructure Strategy Report 2004,

Edmonton, Alberta, see: http://www.edmonton.ca/InfraPlan/Infra/City%20Docs/Infrastructure%202004%20v3.pdf.
84 | CHAPTER 4

No legislative mandates for asset management have come

from the federal or provincial level, but city officials stated that

funding programs from these sources increasingly require evidence of asset stewardship before funding will be awarded.

They think this will become more prevalent in the future, so an

asset management program could become strongly tied to the

city’s ability to obtain funding support. 

Organization for Asset Management

After adopting the Infrastructure Strategy, the City Council

created an Office of Infrastructure in March 2000 (see 

figure 48). Three departments, Asset Management and

Public Works, Transportation and Streets, and Community

Services, form the majority of the city’s asset base and 

contribute an apportioned share of the office’s consulting

budget. The office's mandate is to report the state of the

city's infrastructure, and implement strategies and tactics 

to address the gap between capital needs and available

funding. The office updates the city’s infrastructure 

inventory and investment needs annually and submits 

a formal update of the Infrastructure Strategy to the 

City Council every 2 years. 

The office is also responsible for monitoring strategy recommendations and conducting corporate life cycle costing and a

risk assessment to identify the risk associated with deteriorating infrastructure. The role of the office is as a strategic coordinator; implementing recommendations falls primarily to city

departments. In this way, the office and city departments

operate as a cross-functional corporate team. The Office of

Infrastructure has four employees. 

The city of Edmonton’s director of infrastructure planning

oversees the Office of Infrastructure (OIT). Responsible

for managing OIT, the position’s primary mandate is

to monitor, implement, and update strategies to address

the growing disparity between the city’s infrastructure

capital needs and available funding. An Infrastructure

Working Team (IWT), representing city departments

with an asset management role, assists OIT in collecting

data and preparing information. A Capital Infrastructure

Committee (CIC), composed of nine managers from key

civic departments, provides general guidance in

implementing the Infrastructure Strategy. 

An Infrastructure Technical Advisory Committee (ITAC) has

also been created to provide an opportunity to consult with 20

external professional and technical organizations. The ITAC

mandate is to 1) provide advice to the city as it improves and

validates strategies, processes, and planning tools, 2) provide

a broad scope review of infrastructure issues, and 3) foster

two-way communications between the city and key stakeholders. According to Edmonton officials, ITAC members benefit from their participation by the following:

Figure 48. Asset management organization in Edmonton.
TRANSPORTATION ASSET MANAGEMENT | 85

 Receiving and disseminating to their appointing organizations information on the city’s overall infrastructure investment and management practices

 Accessing media reports that help them monitor developments in other municipalities and measure public opinion

on municipal infrastructure

 Meeting to discuss infrastructure issues with other interested parties

 Having opportunities to see Edmonton management practices firsthand and to influence program development

The Office of Infrastructure reports to the Senior Management

Team monthly, providing updates of work undertaken and

reporting on any new information that has come to the attention of office staff. The office is required to report to the City

Council every 2 years on the state and condition of the city’s

infrastructure. This report includes the inventory and investment needs of the city, as well as investment options and revenue opportunities.

According to officials, the most important role of the Office of

Infrastructure has been its validation of the infrastructure gap,

and its identification of the rehabilitation and growth requirements of the city’s infrastructure. In identifying these needs,

the office has also created tools to help determine the critical

areas that require immediate attention. For example, a risk

assessment of the city’s assets determined an increased risk

with the city’s service connections (pipes that provide sanitary

and/or storm sewer connections to the sewer mains). As a

result, this was taken into consideration in the budgeting

process, removed from the operating budget, and repositioned in the capital program.

The agency with direct responsibility for road asset management is the Transportation and Streets Department. The

department designs, builds, operates, and maintains

Edmonton’s roads, and is organized around strategic planning,

street engineering (including design, construction, maintenance, and services), traffic operations, and transit.

Maintenance is primarily “clean it and fix it,” while rehabilitation is considered a capital project. The department maintains

a core expertise for asset management and contracts out

rehabilitation/reconstruction work, but does maintenance

work primarily in-house.

Part of the organization for asset management is the linkage

among asset managers, elected officials, and the general public. City officials have produced a very impressive document

called Thinking Outside the Gap, Infrastructure Strategy

Report 2004, a biennial infrastructure strategy update report

to the City Council. This report identifies strategies for dealing

with the infrastructure challenge facing the city. This update

included strategies on maximizing use of existing infrastructure, continuing to develop a comprehensive asset management system (including risk assessment and life cycle costing), achieving sustainable levels of service, and promoting

shared services among communities. 

Decisionmaking Approach

Each year since 1998, the city of Edmonton has developed a

10-year long-range financial plan (LRFP) to meet forecasted

needs. The LRFP presents funded and unfunded categories,

with the unfunded portion constituting the infrastructure gap.

A Transportation Master Plan (TMP) broadly outlines allocation targets for road-versus- transit projects and growth-versus-rehabilitation projects. This plan also outlines a series of

10-year priorities. 

At the city level, a business case must be prepared for each

project and is taken under advisement by the CIC, which

ranks projects from highest to lowest priority. Several key factors are considered in this prioritization, including deterioration of infrastructure, service needs, and regulatory requirements; the impact of investment on safety, quality of service,

quality of life, and economic growth; infrastructure condition;

expected infrastructure performance; return on investment;

and demonstrated benefits.

One of the major constraints on the city’s transportation funding is the eligibility of the fuel tax rebate revenues from the

Province. The fuel tax rebate can only be used for the arterial

roadway system (both rehabilitation and growth-related projects) and for major transit system investments (both rehabilitation and growth-related projects). The Province also requires

that the physical condition of the arterial roadway infrastructure

be maintained, which has resulted in maintenance set-asides

for this purpose. Thus, city officials believe that programmatic

requirements of funding sources drive rehabilitation priorities.

For pavement maintenance decisions, the city’s pavement

management system is used as a first-cut identification of the

most critical needs that enter into the city’s 5-year program.

Different levels of service are determined corresponding to

different budget assumptions.

“Pay me now, or pay me later . . . and it will cost

much more later!”

—EDMONTON CITY OFFICIAL IN RESPONSE TO A QUESTION ON WHAT THE ASSET

MANAGEMENT MESSAGE SHOULD BE TO ELECTED OFFICIALS
After the infrastructure gap was verified, the City Council

amended its debt policy to permit borrowing of Can$50 million (US$40 million) per year over 5 years to pay for large,

high-priority capital projects. The borrowed funds are paid for

by a 1 per cent increase in property tax and are allocated to

projects that would otherwise be unfunded, including interchanges, road rehabilitation, and road improvements.

According to city policy, debt-financed projects must be in the

range of Can$10 million (US$8 million), have an asset life of at

least 15 years, and must fit into approved capital plans.

Having committed $100 million in debt financing for key infrastructure projects in 2003 and 2004, Edmonton has already

made significant strides in dealing with key infrastructure

issues.

Performance Measures

Edmonton uses system performance measures of condition,

functionality, and demand capacity for all asset categories.

These are the primary measures it uses to determine if its

infrastructure is performing at desired levels. The degree to

which infrastructure spending is meeting (or not meeting) the

infrastructure gap is also considered an important measure. 

An infrastructure report card is prepared annually that reports

on various asset characteristics. Departments provide data on

the following infrastructure characteristics: replacement value,

quantity and unit of measure, average age, expected asset life,

physical condition rating, demand/capacity rating, functionality rating, capital budget for rehabilitation, growth, other projects (past 3 years), other projects (current year), operating

budget for operations and maintenance (current year),

sources of financing, funded and unfunded 10-year needs for

rehabilitation, growth, and other projects (taken from the 10-

year Long-Range Financial Plan).

Besides the usual condition and ride quality measures found

in almost every asset management program, Edmonton uses a

pavement quality index (PQI), which is a composite of a visual

condition index, road condition index, and structural adequacy

index. PQI is based on a mathematical relationship developed

by relating experts’ visual ratings to instrumented values for

the same sections. A separate PQI formula exists for different

combinations of indices.

Officials are also conducting a pilot project to determine public desires on service levels. This effort reflects a basic philosophy that performance measures should relate to public willingness to pay, as well as to the implications of failing to

achieve desired service levels. 

Asset Management Information Systems

The physical assets monitored in various asset management

systems include the following: 

1. Roads (primary highways, trunk arterials, nontrunk arterials,

residential streets, industrial roads, collectors, locals, and

alleys)

2. Sidewalks (suburban neighborhoods, mature 

neighborhoods, and special treatments)

3. Bridges (major/custom design, standard design, and 

culverts)

4. Auxiliary structures (distinct and continuous)

5. Streetlights (arterial poles, residential poles, decorative

poles, and arterial high-mast poles)

6. Traffic signals (cabinets, poles, closed-circuit TV camera

poles, and cameras)

7. Electronic parking meters

8. Traffic signs (overhead guide sign supports, overhead signs,

ground mount signs, and ground general signs)

Edmonton began using the Municipal Pavement Management

Application (MPMA) in 1986. MPMA defines a network pavement rehabilitation strategy, optimizes the selection of individual road sections, and recommends a 5-year capital investment program. City officials view MPMA as having several

beneficial characteristics, including decision trees that are

easy to customize, output that is based on cost effectiveness,

deterioration models that allow local parameters to be input,

good network analysis capabilities, and good communications/graphics modules.

Data Collection

The Transportation and Streets Department collects the following types of data: For pavements, surface distress is

defined by a visual condition index (VCI, collected manually

using the APWA Paver method), roughness is defined by a

riding comfort index (RCI, collected with a profilometer), and

structural capacity is defined by a structural adequacy index

(SAI). Rutting is collected by a vehicle-mounted rut bar integrated into the data-collection process for surface distress.

For sidewalks, surface distress (the only condition data collected) is collected electronically. For bridges, all individual

structures are rated manually.

The Transportation and Streets Department collects arterial,

collector road, and sidewalk data biennially. Local streets are

surveyed every 4 years, but structural capacity data is collected when needed. Twelve temporary staff, three permanent

staff, and one supervisor collect data for pavements and sidewalks. Data-collection costs are about Can$500,000

(US$400,000) per year.

Analysis Procedures and Prioritization

Edmonton is responsible for 12 infrastructure areas ranging

from roads to affordable housing. To provide a fair comparison

across all infrastructure categories, the Office of Infrastructure

has devised a ranking system that rates the physical condi86 | CHAPTER 4
tion, demand/capacity, and functionality of individual infrastructure elements. Plan Edmonton, the city’s municipal development plan, identifies the following areas as being most

important for city investment: safety and public health,

growth, environment, preservation of infrastructure, and service to people. 

City departments worked together closely to develop a consistent ranking methodology, which established a common vision

for a corporate-wide strategic asset management approach.

The Transportation and Streets Department traditionally kept

good data on its needs, but many other infrastructure areas

did not have the same level of information and had to conduct

data-gathering activities to reach parity with the road asset

database. This effort has facilitated the comparison of disparate infrastructure types, and has set the stage for the corporate risk assessment and life cycle costing processes.

The Transportation and Streets Department uses its own

measures, primarily the pavement quality index (PQI), to

determine its recommended priorities. The department also

uses deterioration curves to determine the change in PQI

based on assumed budgets. For example, the 2004

Transportation and Streets Infrastructure Report presented the

following PQI performance with an assumed continuation of

current funding:

Roadway Type Current PQI (2003) Year 2008 PQI

Primary highway 7.0 6.9

Arterials 5.7 5.3

Collectors 5.1 4.5

Locals 5.2 4.7

Alleys 3.3 2.8

Other assets, such as streetlights, transit equipment, traffic

signs, and parking meters, are rated as being in good, fair, or

poor condition.

Figure 49 shows how the rating scheme works for Edmonton’s

roads. This approach borrows from the report card format

used by the American Society of Civil Engineers (ASCE) when

rating U.S. infrastructure. By using such an approach to analysis, Edmonton officials are able to determine the level of

unfunded infrastructure needs in the city (14 percent in poor

condition and Can$4.1 billion (US$3.1 billion) investment

needed from 2005 to 2014). The condition rating varies by

road classification; 5 percent of major arterial roads and 50

percent of alleys are in poor condition. This information, along

with the amount of infrastructure considered in poor or very

poor condition and the percentage of the replacement value

allocated each year for asset preservation, is used to determine whether the level of infrastructure investment is adequate. National experts have recommended that annual

TRANSPORTATION ASSET MANAGEMENT | 87

Figure 49. Rating Edmonton’s roads by condition, functionality, and demand.
investment in the city’s assets be 2 to 4 percent of the

replacement value. The city spends Can$178 million (US$134.4

million) each year on infrastructure rehabilitation, compared to

a recommended 2 percent of replacement value of Can$383

million (US$289 million). 

The Municipal Pavement Management Application is used to

analyze different performance and budgetary scenarios. For

example, Edmonton officials can look at cost minimization and

maximum performance scenarios or combinations of the two.

Figure 50 shows how MPMA can be used to examine the distribution of pavement condition (the x-axis) given different

budget allocations.

Edmonton was one of the few sites using a formal risk

assessment process to evaluate the impact of failure for a

given element of infrastructure. The first step in the risk analysis process was to segment infrastructure assets into logical

groupings based on common characteristics. For each segment (e.g., one road kilometer), data were collected describing the inventory, state, and condition, and the 10-year rehabilitation financial estimates for that asset. The condition of an

asset was categorized using Edmonton’s standardized

rating system. Conditions were assessed by reviewing

the assets within a given department through a combination of workshops and independent analysis. Failure

was assumed to occur in two ways, either suddenly

and unexpectedly, or gradually and expectedly. The

approach uses 155 different deterioration curves and

probabilities to determine expected failure. 

Figure 51 is an example of the type of analysis that can

result from this effort. In this figure, the severity of an

asset failure is compared to its replacement value.

Those assets found in the upper tier and farthest to the

right are considered greater priorities.

The Office of Infrastructure has been promoting the

use of corporate-wide life cycle costing in infrastructure management, although the Mobile Equipment

Services (Fleet) Department is the only one that has

fully implemented such a system. Eventually, life cycle

costing is expected to be applied at the strategic, network, and project levels. A life cycle costing approach

was used in assessing the status of Edmonton’s sidewalks (a Can$500 million (US$400 million) asset). In

88 | CHAPTER 4

Figure 50. Scenario analysis in Edmonton showing different condition time streams.

Figure 51. Example of risk assessment in Edmonton.
addition, Edmonton officials have used life cycle costing to

examine the possibility of increasing service lives of assets

through initial design concepts. A recent decision to use a

granular base for new and reconstructed roads was based on

the finding that it would increase overall useful life, compared

to the use of full-depth asphalt and cement-treated bases.

The city’s finance group is also looking at an integrated capital and operating budget to get a better sense of life cycle

cost estimates. The Office of Infrastructure is examining criteria that could be used in such an integrated budget concept

to provide an improved balance among renewal, upgrades,

and capacity expansion.

Observations

In establishing an Infrastructure Strategy and undertaking an

investment needs analysis, Edmonton’s Office of Infrastructure

has achieved a high level of credibility in the asset management process. The approach of assessing different assets and

portraying the assessments in tabular and graphical form has

allowed elected officials and the public to understand both

the importance of the city’s assets and the need to support

them financially. Through its asset management efforts, 

Edmonton has demonstrated to others in government that

municipalities require additional funding to keep infrastructure

in reasonable condition.

Edmonton was one of the few cases the scan team observed

in which tradeoff analyses among different asset categories

were conducted. Edmonton does not use models or formulas

to conduct a rigorous tradeoff assessment. However, by using

common criteria—condition, functionality, and demand/capacity—officials are able to get some sense of the benefit to the

city of funding different asset types. The use of an infrastructure scorecard, similar to that used by ASCE, is a good way to

illustrate to the general public the status of the city’s infrastructure. In the pavements area, the use of the PQI measure

and scenario analysis also allows officials to gauge the tradeoffs in system performance associated with different budget

strategies. 

One innovative characteristic of Edmonton’s approach to asset

management was the creation of an infrastructure technical

advisory group. Not only is this advisory group critical for educating key constituencies on the importance of infrastructure,

but it also provides a sounding board for finance and policy

proposals that can lead to greater public and political attention to the asset challenge facing the city. This advisory group

is part of a much larger communications strategy that has

surrounded the city’s asset management program. Public dialogue around asset needs, and the adoption of a “made-inEdmonton” solution, is widely understood and endorsed by

the citizens.

Finally, Edmonton is way ahead of other similar municipalities

in considering risk part of its prioritization process. The combination of the risk of failure and the level of severity associated with such a failure allows city officials to give greater

attention to assets critical to the economy and quality of life in

Edmonton. The scan team did not see anything like the

approach Edmonton takes in any other sites it studied. 

LONDON, ENGLAND

www.tfl.gov.uk

Context

Just over 27 million trips are made in greater London every

day, 8.5 million on public transport, 11 million by car or motorcycle, 7 million on foot, and 0.3 million by bicycle. Transport

for London (TfL), created in 2000, is the agency responsible

for much of the transportation system used by these 27 

million trips. Transport for London manages London's buses,

subway system, Docklands Light

Railway (DLR), and London

Trams. It also runs London River

Services, Victoria Coach Station,

and London's Transport

Museum. Only TfL’s Street

Management Division participated in the presentations 

during this scanning study, so

the team’s observations focus

on road assets rather than 

TfL’s considerable public 

transit assets. 

The backbone of the Street Management Division’s responsibilities is the 580-km (360- mi) road network known as the

Transport for London Road Network (TLRN), also designated

as the “Red Routes.” The stated aim of TfL is to improve the

Red Routes for pedestrians, motor and pedal cyclists, bus

passengers, people with disabilities, drivers, and freight

movement. Because of their strategic role in London’s street

network and their concentration of traffic control and safety

devices, these routes consist of just over 1 million assets.

London’s 33 local boroughs manage the remaining roads in

London, except for those under the responsibility of

England’s Highways Agency. 

Given the size of the metropolitan area (more than 9 million

people), it is not surprising that the stated transportation challenges range from congestion relief (resulting in London’s

innovative road congestion pricing scheme) to safe pedestrian

and bicycling environments. In fact, TfL’s business plan and

TRANSPORTATION ASSET MANAGEMENT | 89

Road

Infrastructure

Managed

 580 km (360 mi)

of primary roads

 4,600 traffic signals

 900 bridges

 10 tunnels
performance monitoring scorecards show that the great

majority of the performance indicators relate to the performance of the Underground (subway). In the business plan,

Transport for London lists the following as the most immediate

priorities:

1. Reducing the number of people killed and injured on

London’s roads

2. Improving the bus network

3. Bringing assets such as bridges and the road network into

a state of good repair

Transport for London committed a substantial amount of

funding to TLRN to reduce the backlog of maintenance

needs, which it inherited when TfL was created. This

investment has resulted in a decrease in the percentage

of roads needing repair from 14.2 to 11.5 percent over

a 2-year period.

Drivers for Asset Management

Transport for London has been committed to asset management for many years. The most important driver for asset

management in its early years was a desire to know what

assets were TfL’s responsibility and the condition of those

assets. The national and London governments have also

adopted a policy of reducing the road maintenance backlog

that had built up over many years, and they consider an asset

management program the most effective way to manage such

a program. More recently, as was discussed in the England

case, the national requirement for whole-of-government

accounting procedures, the opportunities for public borrowing

of funds for transportation investment, and the national

requirement to prepare local transport plans that included a

highway asset management plan have led to increased 

interest in an effective asset management program. 

Decisionmaking Approach

Transport for London’s asset management program identifies

critical asset needs in the city, determines the most costeffective strategy for dealing with these needs, and conveys

progress to elected officials by relating the results to BestValue Performance Indicators (BVPIs). In addition, asset management information has been used to value assets and

redistribute capital maintenance funds among the different

boroughs of London. The following statement from TfL’s 5-

year business plan in the streets management area shows the

important of asset management:37

“The funding level for capital road renewal in the Plan means a

re-evaluation of priorities. The total 5-Year Investment Program

will be focused on striving to meet the government 2010

deadline for clearance of the ‘backlog’. However, the funding

levels under this Business Plan means that there is a significant

risk to meeting the 2010 target.”

The risk mentioned in this statement is expected to be

reduced with the application of asset management principles.

Performance Measures

Transport for London focuses its attention on several 

performance measures, not only for technical analysis, but

also for conveying network status to elected officials. The

most important of these measures are called Best-Value

Performance Indicators (BVPIs), which relate to those 

network characteristics that are considered most critical and

that have the highest value in terms of network effectiveness. London, along with other local authorities, report on

the BVPIs mandated by England’s Department for Transport.

For example, for road network operations, four indicators are

considered most important: 1) percentage of working streetlights, 2) dangerous defects made safe or repaired within 

24 hours, 3) days of temporary traffic controls, and 4) traffic

signals operating effectively. Figure 52 shows condition data

on streetlights (ranging from no defects to unsafe). The scan

team noted a difference in overall condition between light

columns in the first two districts of the city versus the other

three. This was explained as primarily the result of data 

collection by two different contractors, each with a different

concept of what was meant by “minor” or “no defects” 

(a lesson on data consistency when more than one 

entity is collecting data).

One of the most important government goals for TfL was to

reduce the backlog in maintenance needs. This has become

an important program performance measure. The following

information comes from the annual report for TfL that shows

progress toward this goal.

For principal roads not controlled by TfL and the Highways

Agency, the London boroughs have pooled their resources

and chosen one borough, Hammersmith and Fulham Council,

to collect data on these roads. The primary measure (BVPI) for

these roads is a pavement structural condition index.

90 | CHAPTER 4

37 Transport for London, Business Plan, 2005/06-2009/10, Office of the Mayor of London, undated, see: http://www.tfl.gov.uk/tfl/downloads/pdf/business-plan/2005/business-plan-05.pdf.

Maintain

Strategic

Road

Network,

Change

Between

2000 and

2010

Measure Target Progress

Proportion of

network in need

of maintenance

Between

7 and 8%

Substantial

improvement

Halt deterioration

of local road

network

Halt by 2004

End backlog

by 2010

Substantial

improvement
Asset Management Information Systems

The major asset management system for Transport for London

is called the Asset Inventory and Management System

(AIMS), part of the geographic information system (GIS) platform used for numerous city planning and management activities. The basic structure for AIMS is consistent with and

reflects the functionalities of the United Kingdom Pavement

Management System (UKPMS), discussed earlier in the case

description of England. 

The basic data found in AIMS includes network description

(including highway boundaries and road hierarchy and data

by lane), 59 different asset types with about 10 to 15 attributes per asset type, condition data, and crash data. The spatial

accuracy of the data is 1 meter. In addition, Transport for

London employs numerous live video cameras, so the AIMS

data includes not only historic data, but also live feeds from

cameras on the street network. Figure 53 shows two types of

representations available in AIMS. The first one reports the

location, geometric characteristics, and condition of a particular asset (in this case, dropped curb). The second shows a

real-time feed from a camera that indicates several different

assets (bus stop, sign, and information kiosk) and their relationship to what is indicated on plans.

Data Collection

London’s approach to pavement condition data collection is

based on the Detailed Visual Inspection (DVI) regime of

UKPMS. This is carried out in London by walking the network.

Forms are coded for visually determined condition (defects

and their extent) characteristics. This information is used to

report the Best-Value Performance Indicators (BVPI) condition

for footways. In the case of roads, this is converted to equivalent Coarse Visual Inspection (CVI) values as required by the

Department for Transport, so that BVPI comparisons can be

made. Most rural (county) authorities use only CVI condition

collection from a slow-moving vehicle.

Transport for London relies on four inspectors and one supervisor to collect data. TfL officials expressed a high level of

confidence in the quality of this data because of the ability to

maintain direct control of the survey and defect identification.

This has been confirmed by the close correlation between

prediction from its modeled and actual condition results. TfL

TRANSPORTATION ASSET MANAGEMENT | 91

Figure 52. Streetlight inventory and condition assessment in London.
also uses the SCANNER or TRACS machine inspection

method for road condition data collection, a relatively new

methodology for England. TfL plans to work with national and

local authorities to develop correlation between the two survey methodologies so that in the future SCANNER information can be used in its pavement model.

Analysis Procedures and Prioritization

Transport for London uses condition index ratings to establish

project priorities for both roads and sidewalks. The condition

of the asset is rated on a scale of 0 to 100; the bigger the

value of the indicator, the worse the condition. Any asset

receiving 70 or above is considered in “poor” condition. The

“percentage of roads with ratings of 70 or above” is a national

BVPI. Transport for London officials have concluded from the

experience with this approach that treating pavements with

condition index scores of 50 to 70 is the most cost-effective

way to prolong pavement life. 

A pavement deterioration model has been developed to examine the future performance of roads and develop a 

15-to-20-year investment program. For lighting standards,

which appears to be a much bigger asset management issue

in England than in the United States, a model is under development to produce similar results. For bridges, a model based

on current bridge deterioration data in London is used; 

a second phase of tying this into benefit-cost analysis is under

development.

Transport for London uses the pavement model to test different expenditure scenarios: How much funding is needed to

clear the maintenance backlog by 2011? How much funding

is necessary to keep road pavement in a steady state of good

repair and retain it at this level? What are the optimal funding

levels to provide the most cost-effective life cycle investment

program? The assumptions that enter into analysis for each

condition index range include the appropriate type of treatment for roads and sidewalks, average costs of treated

roads/sidewalks, proportion of funds spent, and life cycle of

the roads and sidewalks with assumed rates of deterioration.

Other Local Governments

During the course of the scan team’s discussions in England,

several other local government experiences with asset management were described as best-practice examples. The following

sections provide brief descriptions of these efforts. In addition,

the scan team heard from maintenance contractors and an

asset management consultant on their experiences and

thoughts on local government asset management practice in

England. These observations are presented here as well.

Figure 54 shows the percent of local governments with some

form of asset management system in place. Many systems are

92 | CHAPTER 4

Figure 53. Asset Inventory and Management

System in London.

Figure 54. Percentage of local governments using asset

management systems in England.
TRANSPORTATION ASSET MANAGEMENT | 93

quite simple, while others have been developed by consultants in response to asset management guidance from the

national government. An asset management consultant noted

that the response of local authorities to this guidance falls into

three categories: local authorities that have initiated an effort

to develop an asset management plan, local authorities that

have formed coalitions with other local governments to develop a generic asset management plan that can be applied in

member jurisdictions, and local governments that are not

doing anything. 

For those making some effort to develop an asset management plan, the steps are straightforward. They include a

review of the state of the infrastructure, a gap analysis,

assessment of condition data, preparation of an asset management plan, and development of an implementation strategy. According to the consultant, the experience to date with

local governments is the following:

 Asset management planning is making local authorities

think about managing their assets.

 Few examples of demonstrable benefit exist, simply because

of the short time that has transpired since the first program

was put in place.

 Many see a major benefit in highlighting funding needs in a

repeatable and defensible manner.

 An enlightened few recognize that better planning will provide better value (more productive use of scarce resources).

Several issues common to local authority experiences were

also identified. The quality of data varies widely; tools and

models do not have a good ability to predict future conditions,

especially for nonroad assets; the degree of influence over

resource allocation has yet to be determined; an internal commitment to changing mindsets and possibly decisionmaking

processes is often lacking; funding is insufficient; comprehensive performance measurement and prediction tools are

absent; and processes to deal with customer preferences for

desired service levels need to be established.

A maintenance contractor presented an interesting overview

of the evolving roles of contractors, consultants, and local

authority clients over the past several years. In this evolution,

the relationships have evolved along the following path:

 Client, consultant, and contractor role done in-house 

(traditional government role) to—

 Client and consultant in-house, external contractor to—

 Client and contractor in-house, external consultant to—

 Consultant and contractor external, and report 

independently to client to—

 Consultant and contractor in partnership, and report 

jointly to client to—

 Client, consultant, and contractor in partnership to—

 Consultant and contractor in joint venture

The consultant’s tasks are primarily to do the following:

 Feasibility studies

 Pavement and site investigation

 Major road schemes design

 Maintenance schemes design

 Supervision of works

 Inspection of structures

 Advice on contract documentation, specifications, etc.

 Street lighting

 Environmental issues

 Transportation studies

 Noise studies

The contractor’s tasks are primarily to do the following:

 General reactive ad hoc maintenance, such as emergency

repairs, debris collection, and drain clearance

 Winter maintenance

 Grass cutting and verge maintenance

 Surface dressing and resurfacing

 Road marking

 Gully cleaning

 Structures

Two examples illustrate the local government experience with

asset management program development. 

Hampshire County Council

The Hampshire County Council has developed a Highway

Maintenance Management Plan (HMMP) that is integrated

into the council’s service plan, business plan, and quality 

procedures. The adopted highway maintenance strategy is

intended to do the following:

 Provide a clear statement of highway maintenance policies

and procedures.

 Provide a defined network hierarchy that will meet the 

reasonable demands of all highway users.

 Maintain a systematic approach to decisionmaking within a

consistent framework.

 Provide a common basis for assessing maintenance needs,

resource requirements, and implications.

 Assist in the effective allocation of resources.

 Regularly review policies, standards, and the effectiveness

of maintenance programs. 

The plan defines the working procedures and codes 

of practice to be adopted by all those involved in highway

maintenance.

As an illustration, the key objectives and strategies for bridges

were defined as follows:

 Complete the strengthening of bridges subject to temporary

weight limits over a 2-year period. 

 Complete the strengthening of substandard bridge decks
identified by the assessment program over a 5-year period. 

 Complete the strengthening of substandard bridge deck

roadside areas identified by the assessment program over 

a 10-year period. 

 Eliminate the backlog of structural maintenance items in

which safety is the main criterion over a 5-year period. 

 Eliminate the list of structural repairs where further neglect

would threaten stability, result in capacity reductions, or

create disproportionate future costs over a 10-year period. 

Strategies to be used to accomplish the bridge objectives

included the following:

 Complete the majority of the assessment program on the

remaining rail bridges where three-dimensional nonlinear

analyses are required. 

 Explore in detail the social, environmental, and economic

benefits and disbenefits of permanent weight restrictions on

all substandard bridges. 

 Implement permanent weight restrictions where acceptable. 

 Strengthen to appropriate levels all substandard bridges not

suitable for permanent weight restrictions, in accordance

with Hampshire's priority system. 

 Program essential maintenance and necessary preventive

maintenance schemes outlined in this submission. 

 Ensure that feasibility studies, including design and 

documentation, for strengthening and maintenance 

are prepared in the year preceding the planned works. 

Gloucestershire

Gloucestershire was one of the first local authorities to begin

the process of implementing an asset management strategy in

light of governmental directives to tie transportation plans and

asset management together. It has adopted the Framework for

Asset Management developed by the County Surveyor’s

Society (see Chapter 5) for application in the United Kingdom.

The County Council has established an asset working group,

which has produced several point-of-departure products,

including a statement of objectives, a list of desired outcomes,

definition of asset resources, and the identification of risks

associated with asset condition. 

The council’s core assets were identified as follows:

 Roadway  Urban sidewalks and paths

 Street lighting  Signs and bollards

 Bridges and structures  Urban bike paths

 Trees  Bus stops and shelters

 Gullies  Roadsides

 Pedestrian guardrails  Traffic data

 Traffic signals  Associated drainage data

 Road markings/studs  Real-time passenger information

A gap analysis identified the infrastructure difference between

current and desired levels of service, and the cost of closing

this gap. In addition, this analysis examined the benefits to the

citizens of Gloucestershire. An implementation plan is being

prepared that identifies priorities and needed resources.

Observations

In many ways, the London and other local government examples show asset management practice in its infancy. Many local

governments are just now beginning to develop an asset management plan in response to national legislation. Much of the

data collected are visual condition data, although in some

cases these data are augmented by instrumented vehicle

inspections. Nonetheless, it is impressive that a large number of

local authorities have some form of asset management system

that produces information for decisionmaking. Some interesting

characteristics of this experience include the following.

London and other local government asset management activities are guided by the national Best-Value Performance

Indicators that relate not only to transportation, but also to

other service areas. The use of such national indicators provides consistency in data reporting and comparison, as well

as economies of scale in terms of data-collection technologies

and programs. This consistency (along with a common asset

management framework) has allowed several local authorities

to form working groups that are developing a generic asset

management program for use in member jurisdictions.

Transport for London conducts scenario analyses to understand better the consequences of varying budgets on the performance and condition of the road network. Similar capabilities are being developed for streetlights and bridges.

London’s geographic information system (GIS) platform has

provided Transport for London with an impressive ability to

display and work with the asset database. Not only can engineers and planners look at as-built plans, but in many cases,

video links provide the ability to see the asset in real time. In

addition, the GIS platform is used to convey information to

public officials on both the current status of infrastructure and

on the progress being made.

The use of contractors and consultants to provide asset management services appears to be widespread among local governments. This capability provides a level of consistency in

asset management applications. The advocacy of these contractors and consultants for asset management is an important catalyst for pushing advances in asset management

practice. One challenge of using different contractors for different asset management tasks was seen in the London case,

where the condition of streetlights from one district to another

was dramatically different presumably because two data-collection contractors had different interpretations of what was

meant by good or poor condition.

94 | CHAPTER 4
TRANSPORTATION ASSET MANAGEMENT | 95

Chapter 5:

Associations and Support

Groups for Asset Management

The active promotion and support of

asset management by professional associations and local

transportation officials were important factors in the success

of asset management in many of the sites the scan team studied. This support included not only advocacy on changes in

laws and guidance, but also development of technical materials that define the overall framework for asset management in

the countries. Some of the publications prepared by these

groups have become standard reading in asset management.

Two groups, in particular, stood out as being significantly

involved in asset management, one in New Zealand and

another in England.

Austroads

Austroads, an association of Australian and New Zealand road

and traffic authorities, has provided important leadership in

asset management for its member institutions. Austroads

defines asset management in the following way:

“Road asset management is a structured approach to the

delivery of community benefits through the management of

road networks.”

Asset management is one of the five strategic priorities

Austroads members have selected, along with addressing the

future freight task, optimizing the use of the road network,

enhancing the security and integrity of information, and

improving road safety. The asset management priority objective is to develop and deliver a research program that will

assist road and transport agencies in their efforts to minimize

the whole-of-life cost of road infrastructure assets. Four key

themes are part of this objective: 1) determining optimal levels

of service, 2) identifying road-user requirements, 3) monitoring

and reporting performance, and 4) capital investment.

Austroads is developing an extensive series of technical publications on asset management that will examine the technical

challenges facing those interested in establishing an asset

management program. For example, publications on the following topics are or will soon be available:

 Stakeholder/community requirements (outcomes)

 Asset strategies

 Program development and implementation

 Asset performance

 Asset valuation and audit

The Austroads asset management Web site is at www.austroads.com.au/asset/index.html.

National Asset Management Steering Group

The National Asset Management Steering (NAMS) Group was

formed in 1995 to further asset management best practice and

knowledge in local governments in New Zealand. The group

consists of the top infrastructure-related associations in the

country:

 INGENIUM—Association of Local Government Engineering

 SOLGM—Society of Local Government Managers

 Local Government New Zealand

 Office of the Auditor-General

 New Zealand Water and Wastes Association

 New Zealand Recreation Association

 Association of Local Government Information Managers

NAMS has defined asset management as the process to

“plan, create, acquire, maintain, operate, rehabilitate, replace,

and dispose of assets in the most cost effective (sustainable)

manner required to meet present and future corporate objectives and demands for service levels.” The impetus for the formation of NAMS was a 1993 report of the Office of the

Auditor-General of New Zealand on the weak financial condition of local authorities, along with a local government task

force recommendation to adopt a nationwide asset software

package. This initial motivation to create NAMS was confirmed in 1996 when a law was passed requiring local authorities to prepare 10-year asset management plans. Given infrastructure’s significant role in a local authority’s responsibilities

(between 60 and 80 percent of the budget), NAMS decided to

take a more proactive role in fostering nationwide consistency

in asset management planning. Today, NAMS helps local

authorities move beyond the basic plans developed in

response to the 1996 law to more advanced concepts in asset

management. In addition, it encourages communities to apply

asset management techniques to asset-based activities outside the core (i.e., transportation and water infrastructure) of a

community.
96 | CHAPTER 5

The major vehicle for asset management at the local level is

the 10-year Long-Term Council Community Plan (LTCCP),

which each of the 86 local authorities must prepare every 3

years. The LTCCP must describe desired community outcomes, identify activities that will be undertaken to assure

these outcomes, adopt a long-term focus, and provide for

public input and participation. As an interesting linkage

between asset management and community planning, the

Office of the Auditor-General of New Zealand is required to

audit the LTCCPs, and determine if the plans are indeed concerned about total resource use in the public sector and the

processes described for dealing with the challenges are

sound. The auditor-general is a strong supporter of asset

management in the context of a community’s strategic planning effort. 

As a sister organization to NAMS, a Road Information

Management Systems (RIMS) Group has implemented dTIMS

for deterioration modeling and RAMMS inventory software in

all New Zealand councils. This ensures that road information

is collected and stored in the same format throughout the

country. RIMS continues to develop the software in conjunction with New Zealand users and programmers to enhance

the quality and usability of the systems.

NAMS organizes many technical seminars and workshops on

a variety of asset management topics. Perhaps most important

for developing consistent approaches to asset management

are the internationally recognized manuals NAMS publishes

on asset management. For example, NAMS manuals on

International Infrastructure Management, Optimized Decision

Making Guidelines, Creating Customer Value from Community

Assets, and Asset Valuation and Depreciation Guidelines are

important contributions to the theory and practice of asset

management. The International Infrastructure Management

manual is undergoing a significant review and the new edition

will include U.S., Canadian, and U.K. -specific sections, and

several U.S./Canadian case studies. The manual on Asset

Valuation and Depreciation Guidelines is also being reviewed to

align with the new international accounting standards.

The NAMS Web site is at www.nams.org.nz.

County Surveyors’ Society

The County Surveyors’ Society (CSS) was established in

England in 1885 as an organization aimed at supporting local

governments in their responsibilities for infrastructure and

service provision. It represents the local authority chief officers

from across the United Kingdom with responsibility for strategic planning, transportation, the environment, waste management, and economic development. The authorities that belong

to CSS represent 68 percent of the road network, 79 percent

of the land area, and 50 percent of the population. 

CSS became involved in asset management because its government members faced increasing community demands on

limited infrastructure, but did not have the necessary tools to

deal with the challenge. In addition, national legislation for

best value, asset valuation, developing local transportation

plans, and privatizing service delivery suggested to CSS officials that some effort to provide its members with tools to deal

with asset management was warranted. 

CSS defines asset management as follows:

“Asset management is a strategic approach that identifies the

optimal allocation of resources for the management, operation,

preservation and enhancement of the highway infrastructure

that meets the needs of current and future customers.”

The benefits of such an approach are defined as reducing life

cycle costs; allowing officials to define levels of service for

infrastructure and track performance against these variables;

improving transparency in decisionmaking; providing staff

with the ability to estimate the consequences of budget

changes; reducing the risks associated with financial uncertainty, operational unreliability, and legal challenges; and

meeting government requirements for reporting.

Perhaps the greatest contribution CSS has made to asset

management in the United Kingdom is the publication of

Framework for Highway Asset Management in 2004. The intent

of this manual was to provide a framework for implementing

asset management at the local level, with specific steps to

take governments from concepts to a working asset management process. Figure 55 shows the asset management framework recommended in this manual. 

The manual has been used in many instances to frame the

approach taken for implementing an asset management program in a local authority. A number of authorities have

appointed asset managers and assigned them responsibility

for developing an asset management plan. Others have hired

consultants for a similar purpose. 

In addition to developing the asset management framework,

CSS conducts workshops and offers guidance through its

Web site. It has held numerous conferences on specific 

technical aspects of asset management. Perhaps the most

important activity now underway is development of a manual

on asset valuation. This manual is intended to meet the

requirements of whole-of-government accounting and

resource accounting and budgeting (RAB) requirements of

the national government (see England case). The manual will

show how to value the highway network in direct support of

the Framework for Highway Asset Management. Guidance will

be provided on condition and performance data that need to
be collected to show the linkage between budgets, performance targets, and asset valuation. This will be a timely addition

to the reference library that CSS is providing the profession.

The CSS Web site is at www.cssnet.org.uk.

TRANSPORTATION ASSET MANAGEMENT | 97

Figure 55. Asset management framework recommended by

the County Surveyors’ Society in England.
98 | CHAPTER 5
TRANSPORTATION ASSET MANAGEMENT | 99

Chapter 6:

General Observations

The scan team has identified 31 

observations of interest to transportation officials in the 

United States. These observations are organized in five major

categories—asset management’s role in decisionmaking, 

leadership and organizational structure, asset management

technical activities, program delivery, and human resources.

Leadership and Organization

1. Top-level agency commitment (at the very highest

levels) in support of asset management was apparent

in every case. Asset management was viewed by the chief

executive officer/chief operating officer of the agency as an

important tool for managing the agency’s portfolio and for

maintaining credibility with the agency’s constituencies. Part

of obtaining this high-level commitment was showing how

asset management could produce more cost-effective program results.

2. In almost all cases, changing the organizational culture to think of asset management as a key business

area was pointed to as the key challenge. The evolution in

the use of asset management was viewed as changing the

culture of the organization.

3. Each agency had a management position or office

responsible for asset management. This focal point for

asset management provided guidance to other units in the

organization and acted as a filter for asset information

directed to different decisionmakers in the agency. In addition, this office usually acted as a major participant in

national or state efforts to enhance asset management

activities more broadly.

4. One of the most important aspects of the observed

asset management programs was the bringing

together of agency resources and capabilities for

undertaking asset management and creating an

asset management culture in the organization.

Although many different units in an organization collected

data and produced information on asset performance and

condition, in several cases this information was synthesized

at key decision points in the agency.

Asset Management’s Role in Decisionmaking

5. Each site visited has made a commitment to, and

allocated resources for, developing an asset 

management program, although the approaches varied in

scope and content. Although the scan team found no common, integrated asset management model in the sites visited, the basic components of each asset management effort

were the same. Importantly, asset management approaches

were found in situations where maintenance outsourcing

was a major part of program delivery, as well as where program delivery was done primarily with an agency’s own

staff. 

6. In all of the sites visited, the agencies competed for

resources across all government programs (such as

education, public safety, community services, etc.). Few

agencies had access to transportation-specific revenue

sources, so they had to compete as “whole-of-government.”

Several examples where good data on infrastructure

needs provided justification for additional funds to be

put into transportation infrastructure programs showed

asset management’s role in such a decisionmaking context.

7. Continuity in government has assured a stable environment for asset management to evolve. Top government transportation officials have held their positions for a

long time (in U.S. terms). Once these individuals were convinced of the value of an asset management approach, they

supported continuing asset management efforts. 

8. Several major drivers were identified for adopting an

asset management approach. Similar to the United

States, increasing numbers of trucks using the road network, aging infrastructure, and congested road networks

have created pressures on infrastructure owners. This has

resulted in a need to better manage an important asset

base with limited resources. It has also resulted in providing

this management responsibility with a limited number of

staff (in some cases, staff cutbacks) while at the same time

maintaining staff capability. Finally, linking asset management to broader community and agency goals and conducting tradeoffs among asset categories were mentioned as

important characteristics of individual asset management

efforts. In several cases, asset management was adopted

during hard economic times, so it was viewed as a way to

provide the most cost-efficient program delivery.

9. In some cases, national or state legislation has been

an important catalyst to view asset management in a

different way (e.g., New Zealand’s sustainability law and 
Victoria’s Road Management Act). In Australia, in particular, recent changes in liability laws have been important

factors for developing (Victoria) or stimulating thinking

about (Queensland and New South Wales) a more systematic approach to asset management. In England, national

laws requiring the development of local transport plans

and the legal mandate to maintain a community’s asset

base have led to better integration of asset management

into local planning and decisionmaking. In many cases,

changing governmental accounting rules have also motivated a closer examination of how to assign value to

assets.

10. A good asset management program conveyed to

elected officials strong stewardship of transportation assets, and has been an important consideration in

increasing funding for transportation. In other words,

agencies have been able to demonstrate the need for

additional support, the link between investment and system performance, and the effect on the community of

investing in infrastructure (Alberta, New Zealand, and

VicRoads, in particular, illustrate this).

11. Statements of intent tie an agency’s vision and key

goals to levels of service or performance measures,

providing important vision and accountability points

of departure for asset management. These performance measures, most of which do not deal with asset

management, are used to assure that agency actions

relate to government policies. In the case of asset management, performance measures on the condition, use,

and functionality of the transportation asset have been

used to monitor system performance trends and the overall effectiveness of investment programs. In England, for

example, the asset management approach the national

Department for Transport encourages for local governments is based on performance indicators and targets.

At the strategic or upper-management level, only the most

important information needed for establishing funding

policies by agency heads or for monitoring agency

progress toward policy achievement was provided. The

operating core of the agency often received and produced

information on many different performance/condition

measures.

12. Asset management has been integrated into the

many different corporate or agency planning and

policy documents. For example, the scan team found

asset management incorporated into strategic policy

statements/agency visions, performance measures, 

asset-specific plans (e.g., state highway plans), tactical

operations (e.g., contract specifications for maintenance

outsourcing), and job descriptions. Asset management

was incorporated into multiyear planning efforts, often in

1-year, 5-year, 10-year and 25-year plans. The total asset

management approach suggests consistency in agency

directions and activities.

13. Some advanced examples of asset management

have also begun to integrate asset management

principles and activities into a range of agency

activities and products not specifically focused on

asset management. This reflects the fact that many

agencies faced transportation problems similar to those in

the United States (e.g., congestion, safety, system operations, environmental quality, etc.) and that many nonmajor

asset-based solutions (such as operations strategies) are

being considered. For example, Transit New Zealand is

attempting to link asset management efforts to its 

environmental policy and at the local level to community

quality of life. In England, asset management is supposed

to be incorporated into local transportation plans that

focus on many different aspects of transportation 

system performance.

14. It was interesting to note the blurring of what is

maintenance and how it relates to asset management for investment decisions. In some cases, periodic

maintenance was portrayed as the asset management

program, rather than as just one component of such a

strategy. New South Wales has incorporated capital

renewal projects (which in some cases meant total

replacement of existing structures or portions of roads)

into its network infrastructure program, a program that

focuses on infrastructure maintenance and rehabilitation.

The justification for this was that such projects are acceptable as long as road capacity is not increased. Projects

that significantly increased capacity were considered part

of the formal project development process, often requiring

environmental assessment studies.

15. Consistency and cooperation were apparent in

some cases among different levels of government in

their approach to asset management. National or

state agencies worked with local governments to provide

guidance and/or participate in user groups. This was

especially true in Alberta, England, and New Zealand, and

in some cases in Australia.

Technical Approaches and Data Use in Asset

Management

16. Life cycle costing (also known as whole-of-life

costing) has been adopted in each site as the basic

approach to program and project costing. Importantly,

data identification and collection were targeted to support

this approach.

17. In only a few cases was any effort made to conduct

technical tradeoff assessments among asset 

categories, and these were heavily based on 

engineering judgment Although the scan team looked

for examples where tradeoff analysis occurred among 

100 | CHAPTER 6
different asset categories or among different programs

areas (such as maintenance, capital expansion, and capital renewal), it found very few. It was clear that all of the

agencies were working toward such a capability.

18. Many officials talked about “optimizing” decisions

or “optimization approaches.” In U.S. terms, this means

using quantitative analysis techniques to produce the

most economically efficient outcome. The scan team

believes the term, as used, really meant providing a balanced investment portfolio that reflected community goals

and policy desires.

19. All of the agencies used risk assessment in their

asset management program. For example, the likelihood of disruption or failure of certain types of infrastructure was made a conscious part of the asset management

analysis in New Zealand (subject to high levels of natural

disruptions). In Edmonton, a risk or vulnerability measure

has been developed and incorporated into the formal project assessment process. In New South Wales, the assessment of risk appeared to be a driving force in developing

the network infrastructure program. In England, risk was

used to help prioritize projects. Not surprisingly, the risk

assessment associated with a concessionaire’s participation in a public-private partnership related to those factors

that affected revenue generation, while that for public

services tended to relate to safety, public support, and

customer service factors.

It appeared that the risk assessment approach was

also used as a way to educate and obtain asset

management buy-in from elected officials. The scan

team’s sense is that all of the sites visited have more

formal risk applications and use them more in asset

management applications than do agencies in the

United States.

20. Government accounting procedures were viewed in

several cases as inappropriate for assigning value

to assets and driving asset management decisions.

Based on experience in Queensland and England, asset

management systems were viewed as much more

appropriate to use for asset valuation than straight-line

depreciation accounting rules.

21. Defining core purposes of the agency and investment program and determining the necessary technical support structure were considered important first

steps in implementing asset management. Piecing together the supporting databases was described as critically

important. In this construct, several agencies the team

visited viewed data itself as an asset to be managed and

replaced when it no longer served its function.

22. All of the agencies visited are adopting the

approach of developing locational referencing 

systems for database support for asset 

management. Instead of creating one comprehensive

database for all assets under an agency’s responsibility,

agencies are relying on existing databases (even when

they have been developed with different formats and levels of comprehensiveness) to support their asset management programs. In addition, several agencies adopted

quality-control procedures to make sure that the data collected was high quality. In one example, 30 percent of the

lane kilometers were resampled every year to check the

consistency, accuracy, and uniformity of the original data

collection. In some cases, agencies are beginning to question the range of data collected and to assess the data’s

usefulness in supporting the decisionmaking process. 

An impressive aspect of the database systems was the

wide extent to which the data was available within an

agency. Many said that if you have a computer on your

desk, you can access the asset management database.

23. Data-collection approaches and technologies are

not that different from those used in the United

States. The team saw on national networks pavement

condition measuring vehicles (SCRIM), falling weight

deflectometers, ITS collection of traffic data, use of GIS

and GPS, use of the International Road Index (IRI), etc.

Somewhat different from the United States, much more

data is typically collected on a range of characteristics

(e.g., skid resistance data). VicRoads is exploring the use

of on-ground sensors, early warning systems, and nondestructive testing technologies as part of its data-collection

efforts. At the other end of the technology spectrum,

annual visual inspections of asset condition are conducted

in London using clipboards.

24. The experience with deterioration modeling is not

uniform across the agencies visited, and in many cases

was quite limited. For example, no common definition

exists for remaining service life for different assets, and in

some cases agency officials questioned what this concept

really meant. The experience with deterioration modeling

ranges from commonly used software programs to

reliance on experience and expertise in determining the

most critical investments for preserving or enhancing

future system performance.

Program Delivery

25. One of the most important observations from this

scan is the importance of incorporating strong asset

management principles in public-private partnership (PPP) agreements when such projects are

considered. This was especially true in Victoria and New

South Wales, where agency officials described the learning process they went through in subsequent PPP projects

to have a better asset management provision incorporated

into the concessionaire’s agreement or deed. The model

TRANSPORTATION ASSET MANAGEMENT | 101
that appears to have been adopted in the sites visited was

the use of input-output performance criteria as part of the

concessionaire’s deed that, in essence, guided the asset

management strategy for the project. The concessionaire’s

response was to provide adequate funding in its business

model to provide the desired asset management program.

This institutional learning process is an important experience for U.S. asset owners considering entering into such

arrangements.

26. In all of the sites visited, transportation agencies

have used private contracts for delivering much, if

not all, of their maintenance and minor capital construction programs. Preventive and renewal maintenance are important parts of a comprehensive asset management program, so the relationship between how and

when assets are maintained and the contractors’ program

responsibilities becomes an important consideration in

determining the overall effectiveness of asset management efforts. The key approach was to encourage contractor ownership of asset management in the

delivered program. For example, in a performancebased contracting regime, an agency must make sure that

the structural integrity of pavements is maintained or

addressed when contractors are making maintenance

investment decisions. In some cases in which contracts

were let before a system of performance management

was in place, questions of service quality, asset condition,

and price occurred.

Agencies in England, which has many years of experience

with maintenance outsourcing, appear to be moving to a

hybrid strategy of service provision by including owner

agencies in service provision partnerships, and in some

cases providing services themselves again. 

27. Agencies have made efforts to reach out to public

officials and, in some cases, to the general public,

to convey the importance of an asset management

policy. In Edmonton and New Zealand, for example, such

outreach has been considered successful in developing

support for agency funding. In all cases, the state ministers of transportation have bought into asset management

as an important policy focus. In at least two cases (New

Zealand and Victoria), focus groups were used to affirm

the importance assigned to maintenance and capital

renewal program investment. In other cases, focus groups

were used to determine the attitudes and reactions of the

general public toward the agency’s priorities and resource

allocation. In Edmonton, an infrastructure advisory committee consisting of important business and community

leaders has been established.

28. Australia, New Zealand, and England, in particular,

have very active asset management professional

associations and user groups, spearheaded by local

officials, that have developed materials aimed at both

public officials and practicing transportation professionals.

The scanning team found impressive asset management

outreach material in England and New Zealand. In both

cases, the initiatives were spearheaded by local government associations or national working groups (or alliances

as they were called). Austroads, Australia’s equivalent to

AASHTO, is in the process of putting together asset management material, much of which is found in separate

reports.

Human Resources

29. An effective asset management program has a

strong human resource element. In some cases, an

asset management program (and usually private outsourcing of maintenance) was implemented at the same time

staff cutbacks occurred. Every agency visited, however,

noted that a good asset management program requires

capabilities in understanding the data-collection process

and what the data mean. When private concessions were

used for data collection and maintenance efforts, the

owner agencies needed capable staff to manage the contracts. In almost every case, agencies have added staff

since their low points in the 1980s and 1990s. Training

(see below) thus has become an important human

resource support activity.

30. Several agency personnel systems have created

positions with asset management in the job responsibilities. As officials in England noted, local government

positions for asset management professionals, and civil

engineers in general, are being advertised with only limited success in attracting qualified applicants. 

31. In many agencies the scan team visited, asset management training has been an important aspect of their

asset management strategy, not only for staff but also for

other jurisdictions using asset management approaches.

In Alberta, England, New Zealand, and Queensland, in

particular, manuals and best-practice procedures have

been developed to promote consistency in asset management applications.

102 | CHAPTER 6
TRANSPORTATION ASSET MANAGEMENT | 103

Chapter 7:

Lessons for the

United States

The countries, states, provinces, and

local governments the scan team visited during this study 

provided a rich experience in the challenges and benefits

associated with asset management. It is not surprising, 

therefore, that a number of “lessons learned” for the United

States have resulted from this scan. 

1. Asset management practices and processes have

been used successfully to obtain funding for 

transportation infrastructure, when competing for 

funds with other government programs and even during

budget declines.

2. Asset management as an organizational culture,

business-oriented decisionmaking process, and 

policy direction is a critical foundation for transportation programs facing significant capital renewal and

preservation needs. All of the countries the team visited

adopted asset management as a major policy direction 

for national, state, and in some cases local transportation

programs. 

3. Given the importance of asset management in

changing an organization’s culture, it is important to

think carefully about what role asset management

will play in the agency’s program delivery effort. In 

addition, the eventual acceptance of asset management in

an organization’s culture will occur when the benefits of

such an approach are evident. 

4. Adopting an asset management approach in an

organization does not mean that everything has to

change. In the cases examined, agencies had clearly

adapted their asset management efforts to the organizational context. One consequence of this is that incorporating an

asset management culture into an organization requires a

long-term commitment from top management.

5. The principles and benefits of asset management

were not linked to agency downsizing or outsourcing

of agency services. This is a common misperception

associated with asset management efforts.

6. Creating asset manager positions or at least assigning

responsibilities for the asset management function is

an important foundation for an effective management program. Such a position or agency unit should report to the

top management in an organization. This not only provides

a focal point for asset management activities, but also can

foster a champion for asset management who can act as a

catalyst in the organization. 

7. All of the asset management programs the team

studied used the concept of risk for establishing

investment priorities. Most U.S. asset management

experience does not have the same level of application.

Risk concepts need to be incorporated more systematically

into U.S. asset management efforts. 

8. Based on experience in Queensland and England,

asset values determined using the asset management system provide a more realistic and useful 

representation of the value of physical assets. This

value supports both the accounting and management

functions as opposed to straight-line depreciation, which

does not reflect the true value of the assets and serves no

purpose for management.

9. The most common performance measures used in

the scan asset management examples related to

condition, function, and capacity of the assets. In

some cases, these categories of performance characteristics can provide the basis for cross-asset evaluation and

investment prioritization. Engaging stakeholders in setting

performance targets is the most effective way to calibrate

fact-based assessment of asset needs with public desires.

Stakeholder buy-in to the asset approach and performance measures lends credibility to the effort.

10. Asset management should be strongly linked to

planning and system operations. It was apparent in

several cases that efforts had been made to institutionalize

asset management concepts into state/local planning

efforts, and to look at system operations strategies as

complementary to asset-based improvements.

11. Perhaps one of the most important lessons for the

United States was the integration of asset management concepts into public-private partnership
agreements. Several agencies that have entered into

such agreements for toll roads have learned from experience that a comprehensive asset management effort

needs be part of any agreement to ensure the asset is

returned to the owner in good condition.

12. Asset management efforts are data driven, but

developing an asset management culture in an

organization does not have to wait the many years it

would take to develop database information systems. Agencies can start with modest efforts and evolve

over time into a more comprehensive perspective.

13. Data collected should have a clear purpose and be

directly related to asset management decisionmaking. Data-collection costs should be tracked and data

itself treated as an asset, with the same design, build,

operate, maintain, and life cycle cost analysis used for

other assets.

14. Tradeoff analysis techniques are more complex than

simply assessing priorities in one asset category.

The scan team did not find any case where technically

based cross-asset tradeoff tools were used. This is an

important area for further development in the United

States.

15. Cross-functional teams, consisting of engineers,

finance analysts, operations staff, and communications experts, can serve as the best means of understanding the many different aspects of asset management,

such as data collection, strategy development, and quality

assurance. 

16. The use of focus groups to establish and/or validate

resource apportionments for different asset categories is a

useful tool in asset management programs.

17. Before contracting out core services, performancebased management systems should be in place that

allow the infrastructure owner to know what service levels

are required. This was described in the scan as being a

“knowledgeable owner.”

18. Although initial cost savings may be realized by

contracting out maintenance services, such 

program delivery is kept most efficient when both

public and private providers have some ability to

compete to provide service. In addition, it was apparent in most of the sites visited that although the number

of maintenance personnel in agencies declined following

outsourcing, the contract supervision and finance staffs

have either stayed at the same levels or increased.

19. Asset management training for all levels of transportation officials is an important initiative for changing

the culture of an organization and establishing asset 

management expectations among key stakeholders.

104 | CHAPTER 7
TRANSPORTATION ASSET MANAGEMENT | 105

Objectives

1. Advance asset management principles as the strategic tools

for assessing the entire Interstate System.

2. Compare and contrast the similarities with other countries’

highway networks, England’s trunk system in particular, and

how asset management can support the new vision for the

Interstate System.

3. Develop information on the economic impact of the 

degradation of the Interstate System.

4. Determine a risk-allocation process for the Interstate

System.

5. Identify performance indicators and standards for the

Interstate System to ensure its prominence in the delivery of

goods and services for the entire Nation (e.g., smoothness,

remaining service life) that are common across the system.

6. Assume a national leadership role to protect the highest

level of the transportation system, and encourage State and

local agencies to work collaboratively on the remaining

public assets.

Tasks

1. Initiate a study to determine the benefits of using asset

management plans for all segments of the Interstate

System. The study should include analysis of the economic,

social, and political impacts of requiring such plans and the

mechanisms necessary to implement such a requirement. 

2. Document asset management practice in England, including

national policy, performance indicators, and reporting

requirements for national and local agencies. Draft correlating policy indicators and reporting requirements for the

United States, which could provide guidance on reporting

national, regional, and local transportation network performance. 

3. Target a State or region to take a holistic view of the entire

public asset inventory that provides increased funding flexibility. 

4. Develop linkage between transportation planning and 

programming and asset management at the metropolitan

planning organization (MPO) level.

Join with other efforts, agencies, and resources to

embed asset management into existing efforts on an

ongoing basis. Create a National Asset Management

Chapter 8:

Implementation Strategies

The scan team identified several 

short- and long-term strategies for disseminating and furthering the results of this scan.

Short-Term Strategies

1. The scan results should be disseminated as widely as 

possible throughout the professional community.

Presentations will be scheduled for the annual meeting of

TRB, AASHTO, APWA, and 6th National Asset Management

Conference in fall 2005. Other opportunities will be identified by scan team members. The Transportation Asset

Management community practice Web site will be 

repackaged to incorporate scan results.

2. The AASHTO Subcommittee on Transportation Asset

Management will be encouraged to continue development

of the asset management software NT and PT by

AASHTOWare. The subcommittee will also prepare a 

resolution for AASHTO board consideration that reinforces

asset management as an important national and state 

policy.

3. The existing National Highway Institute (NHI) course on

asset management should be updated to reflect what has

been learned on this scan.

4. A senior executive forum on asset management should be

organized to introduce senior leaders at transportation

agencies to asset management concepts. This should be

similar in format to the performance-based maintenance

contracting workshop. 

5. A national telecast/Webcast on asset management similar

to such telecasts on freight should be organized. A target

date for this is summer 2006.

Long-Term Strategies

The following three implementation strategies create a climate

of continuous process improvement on transportation asset

management in the United States.

Change the national viewpoint of the Interstate System from

merely highway expenditures to investments in mobility of

people, goods, and services by using an asset managementbased methodology that focuses on future conditions while

identifying the cost of competitiveness and economic power.
Steering Committee (NAMS) in the United States. Such

an effort provides a platform to distribute information,

provide training, and document best practices on transportation asset management nationally and abroad.

Develop an easy-to-understand toolbox for asset management that can be applied at different levels of government. The tools should look beyond transportation to

best practices in other industries. These tools should be

available on a Web site for free downloading. 

Objectives

1. Develop a resource clearinghouse for asset management in

the United States that draws from and is directly tied to

equivalent efforts internationally and is available in the public domain. 

2. Market this clearinghouse to all levels of U.S. agencies and

across all types of infrastructure. 

3. Investigate whether U.S. efforts to document best asset

management practice and provide resources can be integrated with existing international asset management consortia. 

4. Participate annually in a national asset management forum

to review progress, document case studies, develop curricula, and coordinate research efforts across infrastructure

and federal agencies. 

5. Inform all levels of transportation agencies—State, MPO,

and local—of this resource clearinghouse. 

Tasks

1. Meet/communicate with FHWA and EPA to discuss potential alliance of asset management efforts.

2. Develop a white paper discussing the relationships among

AASHTO, FHWA, and EPA priorities and opportunity presented in asset management.

3. Contact the international NAMS to identify copyright

restrictions and opportunities to add the United States to

existing efforts and document U.S. case studies for inclusion in the existing library of best practices. Develop alternatives with recommendations for U.S. clearinghouse

implementation.

4. Document the state of practice at the state and local transportation agency level in the United States as part of establishing a national approach to transportation asset management.

5. Communicate with State, MPO, and local transportation

agencies to inform them of training, forums, and best practices.

6. Write articles for APWA Reporter, Public Roads, and appropriate state, municipal, and engineering journals.

7. Support benchmarking of the U.S. asset management

process (rather than performance) for local, regional, and

State agencies. This should include an assessment of the

capability and execution of linking decisions to quantified 

asset-related costs and benefits, as well as whether

processes have been documented and how often this

occurs. Efforts should consider incorporating the AASHTO

self-assessment survey. Share results at various State,

MPO, and local government conferences and in literature. 

8. Create an automated survey tool in the public domain that

participating agencies can complete and have results

arrayed against comparable levels of governments. 

9. Develop a national competition on transportation asset

management under FHWA’s Transportation Planning

Excellence Award Program. 

10. Develop videos and training materials aimed at various

levels of government.

Extend U.S. asset management practice through

NCHRP and other research opportunities.

The scan team identified several potential research projects:

1. Conduct before-and-after studies on the effectiveness of

asset management efforts and the identification of benefits.

2. Establish state-of-the-art practices for data collection and

analysis for asset management.

3. Define and quantify risk categories for an asset management program.

4. Synthesize data management principles, collection, sampling, and auditing techniques for asset management.

5. Examine world experience with high-speed deflectograph

technology, looking at the Denmark technology identified in

the England case study.

6. Examine more closely transportation assets other than

bridges and road pavement, such as appurtenances, transit,

streetlights, etc.

7. Synthesize practice with how 3-D or design files are linked

to geographic information systems (GIS).

106 | CHAPTER 8
TRANSPORTATION ASSET MANAGEMENT | 107

David R. Geiger (FHWA Co-Chair)

Director

Office of Asset Management

Federal Highway Administration

HIAM-1 (Room 3211)

400 Seventh Street SW.

Washington, DC 20590

E-mail: david.r.geiger@fhwa.dot.gov

Paul T. Wells (AASHTO Co-Chair)

Chief Engineer

New York State Department 

of Transportation

50 Wolf Road

Albany, New York 12232

E-mail: pwells@dot.state.ny.us

Dr. Michael Meyer 

(Report Facilitator)

Professor

School of Civil & Environmental 

Engineering 

Georgia Institute of Technology 

790 Atlantic Drive 

Atlanta, GA 30332 

E-mail:michael.meyer@ce.gatech.edu

Patricia Bugas-Schramm

Assistant to the Director

Portland Transportation Maintenance

2929 North Kerby Avenue

Portland, OR 97227

E-mail: patricia.bugas-schramm@

pdxtrans.org

Lacy D. Love

Director, Asset Management

North Carolina Department 

of Transportation

Raleigh, NC 27699-1538

Mailing Address:

1 South Wilmington Street

Transportation Building, Room 106

Raleigh, NC 27601

E-mail: llove@dot.state.nc.us

Dr. Sue McNeil

Director and Professor

Urban Transportation Center

University of Illinois at Chicago

412 South Peoria Street, MC 357

Chicago, IL 60607

(Address after Aug. 1, 2005:)

Dr. Sue McNeil

Professor

Department of Civil and 

Environmental Engineering

301 West Dupont Hall

University of Delaware

Newark, DE 19716-3120

E-mail:mcneil@ce.udel.edu

Dennis L. Merida

Division Administrator

New Jersey Division,

Federal Highway Administration

840 Bear Tavern Road, Suite 310

West Trenton, NJ 08628

E-mail: dennis.merida@fhwa.dot.gov

Robert Ritter

Office of Planning, HEPP

Federal Highway Administration

400 Seventh Street, SW.

Washington, DC 20590

E-mail: robert.ritter@fhwa.dot.gov

Kirk T. Steudle

Chief Deputy Director

Michigan Department of Transportation

425 West Ottawa Street

PO Box 30050

Lansing, MI 48909

E-mail:steudlek@michigan.gov

Donald R. Tuggle

Director, Program Administration

Federal Highway Administration 

Eastern Federal Lands Highway

Division

21400 Ridgetop Circle

Sterling,VA 20166

E-mail: donald.tuggle@fhwa.dot.gov

Larry Velasquez

District Engineer

New Mexico Department 

of Transportation

PO Box 1149

Santa Fe, NM 87504-1149

E-mail: larry.velasquez@nm.state.us

Appendix A:

Scan Team Data

Biographic Sketches

David R. Geiger (FHWA Co-Chair) is director of the

Office of Asset Management for FHWA in Washington, DC. He

is responsible for promoting the concept of asset management

in the agency and for working with State departments of

transportation to develop the necessary engineering and 

economic analysis tools and management systems to success

fully implement asset management as a standard for making

investment decisions and managing transportation systems.

Geiger has a bachelor’s degree in civil engineering from

Michigan Technological University and has held several man-
agement-level positions in FHWA’s field and headquarters

offices. He is a member of the American Public Works

Association, American Society of Civil Engineers, and

Transportation Research Board Committee on Asset

Management. He serves as secretary of the AASHTO

Subcommittee on Asset Management, and he is a licensed

professional engineer in Wyoming and Louisiana.

Paul T. Wells (AASHTO Co-Chair) is chief engineer for

the New York State Department of Transportation. Pavement,

bridge, and safety management systems are part of his

responsibility. With a large, complex, but aging infrastructure,

cost-effective investments are critically important to the New

York State DOT, especially when transportation funding is

uncertain. Before becoming chief engineer, Wells was the

department’s chief engineer for construction and oversaw the

annual $1.65 billion statewide construction program, including

complex projects in the New York City metropolitan area.

Some of the most difficult asset management issues involve

rehabilitation and preventive maintenance approaches for the

large urban viaducts and East River Bridges in New York City.

Wells graduated from State University of New York at Buffalo

with a civil engineering degree and is a licensed professional

engineer in New York State. He is a member of the AASHTO

Standing Committee on Highways, Standing Committee on

Research, Technology Implementation Group, and Joint

AASHTO/ARTBA/AGC Committee. He also serves on a number of NCHRP panels, such as the Research and Technology

Coordinating Committee that oversees FHWA research programs and NCHRP Panel 20-36 on Highway Research and

Technology—International Information Program.

Dr. Michael Meyer (Report Facilitator) is professor and

former chair of Civil and Environmental Engineering at the

Georgia Institute of Technology. From 1993 to 1998, Meyer

was director of transportation planning and development for

the State of Massachusetts, where he was responsible for

statewide planning, project development, traffic engineering,

and transportation research. Before that, he was a professor

in the Department of Civil Engineering at the Massachusetts

Institute of Technology (MIT). Meyer has written more than

160 technical articles and has authored or coauthored numerous textbooks on transportation planning, policy and education, environmental impact analysis, and intermodal transportation. He received a bachelor’s degree in civil engineering

from the University of Wisconsin, a master’s degree in civil

engineering from Northwestern University, and a Ph.D. in civil

engineering from MIT. He is a registered professional engineer in Georgia. 

Patricia Bugas-Schramm is assistant to the director of

the Portland Transportation Maintenance Bureau in Portland,

OR. Bugas-Schramm has coordinated development of seven

strategic transportation asset-specific management plans for

Portland Transportation since 2000. As infrastructure management system (IMS) project manager, she coordinated consultant and staff efforts through the 1990s that resulted in the

integration of asset inventories, work management tools,

maps, and financial systems in 2000. She initiated Portland

Transportation’s annual Status and Condition Report, now in

its 19th year of publication. She has made presentations on

Portland’s asset management work at the American Public

Works Association (APWA) Oregon Conference, American

Society of Civil Engineers (ASCE) Conference in Portland, and

the National Highway Institute’s Transportation Asset

Management workshop for the Oregon Department of

Transportation leadership. She is a member of APWA and has

a bachelor’s degree from the University of Oregon. 

Lacy D. Love is director of asset management for the North

Carolina Department of Transportation. Love oversees

NCDOT’s statewide operational programs and administrative

units for bridge maintenance, pavement maintenance, roadway maintenance, equipment and inventory control, intelligent

transportation systems office, secondary roads, and

oversize/overweight permits. In addition to managing these

units, he develops performance standards and implements

monitoring/management systems for the various highway

infrastructure assets. In the past, Love has served in various

field and central operations positions with maintenance

responsibilities for various highway assets and maintenance

programs. He graduated from North Carolina State University

in 1979 with a bachelor’s degree in civil engineering. He

serves on the AASHTO Highway Subcommittee on

Maintenance as vice chair of the Management Systems 

Focus Group. He also served as a member of the panel that

developed the AASHTO Guidelines for Maintenance

Management Systems. 

Dr. Sue McNeil is director of the Urban Transportation

Center and professor in the College of Urban Planning and

Public Affairs at the University of Illinois at Chicago (UIC).

Her research and teaching interests focus on transportation

asset management with emphasis on the application of

advanced technologies, economic analysis, analytical methods, and computer applications. Before joining UIC, she was

a professor of civil and environmental engineering and engineering and public policy at Carnegie Mellon University.

McNeil graduated from the University of Newcastle in

Australia, and has a master’s degree and Ph.D. in civil engineering from Carnegie Mellon University in Pittsburgh, PA.

She is a registered professional engineer. McNeil chairs the

Transportation Research Board Asset Management

Committee and serves on the Executive and other committees. She is associate editor of the Journal of Infrastructure

Systems and a member and former chair of the

108 | APPENDIX A
Infrastructure Committee of the American Society of Civil

Engineers. 

Dennis L. Merida is administrator of the FHWA New Jersey

Division in West Trenton, NJ. He is responsible for administering an $800 million Federal-aid program in New Jersey. He

directs a staff of 27 professionals in engineering, structures,

planning, finance, safety, and environmental analysis. He has

served in this capacity for the 10 years. Merida is a member of

the division administrators’ advisory group for asset management policy for FHWA. He has 30 years of experience with

FHWA in a variety of engineering, planning, and environmental assignments in headquarters and field offices. He has

bachelor’s and master’s degrees in civil engineering from the

University of Michigan. He is a licensed professional engineer

in Virginia and a member of the American Society of Civil

Engineers. 

Robert Ritter is team leader of the Planning Capacity

Building Team in FHWA’s Office of Planning. The

Transportation Planning Capacity Building program provides

training, technical assistance, and support to help decisionmakers resolve the increasingly complex issues of addressing

transportation needs in their communities. Before joining

FHWA, Ritter was director of policy activities for the Eno

Transportation Foundation, where he was responsible for

bringing together government, academic, and industry representatives to address topics such as intermodal freight issues,

global climate change, and induced demand. Ritter has a

master’s degree in transportation from Morgan State

University and a bachelor’s degree in civil engineering degree

from Rutgers University. He is a licensed professional engineer

and certified planner. He is a member of the Transportation

Research Board’s Intermodal Freight Transport and

Metropolitan Policy, Planning, and Processes committees, and

is FHWA liaison to the NCHRP project panel on research for

the AASHTO Standing Committee on Planning.

Kirk T. Steudle is chief deputy director of the Michigan

Department of Transportation (MDOT) in Lansing, MI, and is

engaged in all aspects of transportation in the State. Steudle

represents MDOT on the Michigan Transportation Asset

Management Council and chairs the AASHTO Subcommittee

on Asset Management. In August 2004, Steudle participated

as a member of the National Asset Management Delegation

conducting a transportation asset management seminar in

Riga, Latvia, for transportation professionals from Estonia,

Latvia, and Lithuania. In his previous jobs as bay region engineer for the 13 counties in the Saginaw/Bay City area and

deputy region engineer for the Detroit metropolitan region, he

was responsible for strategically managing regional assets in

a cost-effective and efficient manner, concentrating on planning and programming, program delivery, and monitoring and

reporting results involving road and bridge assets. This was

long before asset management became known as a discipline.

Steudle has served with MDOT for more than 17 years. He

has a bachelor’s degree in construction engineering from

Lawrence Technological University and is a registered licensed

professional engineer in Michigan. 

Donald Tuggle is director of program administration in the

Eastern Federal Lands Highway Division in Sterling, VA, a post

he has held since 2001. Before that, he was special assistant

to the FHWA executive director. He is now the Federal Lands

leadership sponsor of a multidivision team on context-sensitive solutions. His 28-year FHWA career has included field

assignments in Ohio, Michigan, Chicago, IL, and headquarters

assignments in the Pavement Division, Construction and

Maintenance Division, and Office of Asset Management. He

has a bachelor’s degree in civil engineering from the

University of Wisconsin-Platteville and is a registered professional engineer in Wisconsin.

Larry Velasquez has served the New Mexico Department

of Transportation as the engineering/design division director

and infrastructure coordination engineer, and is now district

engineer for the largest metropolitan area in New Mexico. As

district engineer, he is responsible for construction and maintenance operations of a metropolitan and rural transportation

system. Velasquez, who has been with the NMDOT for 5

years, has more then 20 years’ experience in the transportation field. Before joining NMDOT, he spent many years in

transportation engineering and management for municipal

and county governments. He has a bachelor’s degree in civil

engineering from the University of New Mexico. He is a

licensed professional engineer in New Mexico. He has served

on the AASHTO Standing Committee on Highways and two of

its subcommittees. He is on the TRB Synthesis (20-5) Panel.

He is a member of the Institute of Transportation Engineers

and American Society of Civil Engineers.

TRANSPORTATION ASSET MANAGEMENT | 109
110 | APPENDIX A
TRANSPORTATION ASSET MANAGEMENT | 111

Appendix B:

Amplifying Questions

Overview of Transportation Asset

Management

1. Please provide a brief overview of how your agency is

organized. What are the major funding sources for 

your transportation program? What are the critical 

transportation issues/challenges facing your state/

province/city/agency?

2. Is the asset management function primarily assigned to one

office, or is it integrated throughout the organization? What

staff resources are dedicated to this function? Has this

organizational responsibility stayed the same over time, or

has it changed? If it has changed, why was the change

made?

3. What were the major reasons your agency adopted an

asset management philosophy for organizational decisionmaking and management? When did your agency first

begin to use transportation asset management? How has it

evolved since this initial use? What barriers or challenges

have you faced in implementing your asset management

program in your agency? How were these barriers/challenges overcome?

4. What have been the major drivers of transportation asset

management in your agency? Are there legislative mandates for conducting asset management?

5. Do you have a stated goal or mission for your asset management program? How important is asset management as

stated in this goal or mission in influencing decisions in

comparison to other factors, such as politics, emphasis on

large-scale capital projects, regional equity in investment,

etc.? 

6. Have you defined an “asset manager” position in your

agency? If so, what are the duties of this position? Where

does the role of asset manager report within your operations and management organization with respect to budget

allocation and work assignments? 

7. Do you have asset management teams in your agency? If

so, what are their role, responsibilities, and composition?

8. We are interested in comprehensive/integrated/organizationwide transportation asset management programs. By this,

we mean an asset management program that considers

assets across modes, organizational functions, and asset

groups, and that integrates asset management information

vertically and horizontally within the agency decisionmaking

structure. Would you describe your asset management program as being “comprehensive” and/or “integrated?” What

aspects of your program make it so?

Relationship Between Asset Management and

Decisionmaking

1. Please describe the investment decisionmaking processes

in your agency. How is the information produced from the

asset management system used in your agency decisionmaking, ranging from strategic or corporate planning to

operations decisions? Please provide specific examples of

this linkage between asset management information and

decisionmaking.

2. Have the results of your asset management effort influenced the overall level of funding provided to your agency?

If so, can you quantify this impact? 

3. Does your agency have a policy that establishes the relative

importance of infrastructure maintenance and preservation

versus capacity expansion versus operational improvements? How is a balance in investment made among the

different types of projects in your agency’s portfolio (e.g.,

balanced investment among bridge, pavement, operations,

preservation, etc., projects)? 

4. If investment tradeoffs are made among such things as

safety, environmental quality, sustainability, congestion relief,

capacity expansion, infrastructure preservation, etc., how

are these tradeoffs made? If your agency is responsible for

more than one mode of transportation, how are investment

tradeoffs made and priorities established among different

modal programs?

5. Does your asset management process occur within a much

larger transportation system performance measurement or

key performance indicator process? If so, what are the key

performance/condition measures used in the asset management process?
6. If system performance measurement is used in your agency

or jurisdiction, how is decisionmaking influenced by performance indicators? If benchmarks or targets are used as

part of the performance measurement program, do these

benchmarks/targets support decisionmaking or do they

drive it?

7. Do you use return on investment or benefit/cost analyses

to establish project priorities?

8. Do you use life cycle costs in repair/replace/build decisions? Is asset data used to establish life cycle cost 

information? If so, how does life cycle cost information

affect decisions relating to budgets for capital investment

and for maintenance?

9. For unique projects where special materials are used in

project design (e.g., downtown transit or pedestrian

malls, main streets, etc.), do you assess the life cycle

costs of such special treatments when making a 

project decision? 

10. If you outsource or privatize maintenance/operations 

activities in your organization, how is your asset management program used in establishing the budgets, priorities,

and/or task allocations in such efforts?

Technical Aspects of Transportation Asset

Management

1. What are the major components/tasks of your transportation asset management system? What physical assets are

monitored?

2. What database systems are part of your asset management program (e.g., pavement, bridge, sign/signal/pavement markings, intelligent transportation system, equipment inventory, etc.)? How are these systems linked or 

integrated with one another?

3. If you have an integrated or linked set of systems, can 

managers use them to conduct scenario analyses to 

investigate the effect on transportation system performance and condition of different levels of investment?

4. For the different assets monitored as part of your asset

management program, describe the types of data collected and the data collection strategies used. In particular,

how does condition inspection occur for the different

types of assets in your agency’s portfolio? 

5. What is the schedule for collecting data on different

assets in your inventory? How is this data collection effort

staffed (data collection, data entry, data maintenance,

process, etc.)? Is data collection a distinct role/task

assigned to dedicated forces or is it piggybacked onto

other work? What are the costs associated with the data

collection effort? Have you conducted a benefit/cost

analysis of the data collection effort associated with your

asset management effort?

6. What quality assurance/quality control policies and/or

methods do you employ to assure the integrity and value

of the data collected?

7. Do you track planned and emergency maintenance on 

individual assets? If so, how is this done within the context

of your asset management program?

8. What types of information and location technology systems are used as part of the asset management program

(field technology, mapping applications, work management systems, global positioning systems, geographic

information systems, etc.)? How are they integrated with

each other? What, if any, problems have you had with any

of these systems?

9. How do you segment linear systems (roads, trails, sidewalks, etc.) into assets?

10. Can mapped data be used to plan and design projects?

For example, is the database detailed enough to be able to

target sign replacement by sign legend? 

11. Do you use remote electronic devices to either maintain

asset inventories or track asset condition? Do you have,

or do you envision, using “smart” materials or sensors for

monitoring the condition of infrastructure?

12. Are benchmarks or target values of asset condition and

maintenance incorporated into the asset management

analysis? Is the level of service or other measures of

operating performance used in the asset management

analysis? How are these measures established? 

Has any effort been made to get input from the 

public or other groups on what these measures 

should be?

13. In the context of maintaining infrastructure integrity, how

does your agency or jurisdiction establish and enforce

restrictions on damage-causing activities such as overweight vehicles? Have the results of your asset management program been used to help define what these activities might be?

14. What technical models/approaches are used as part of

your asset management program, in particular to assess

the value of assets? What types of asset valuation methods have been used in your asset management program,

and have any of these methods been more effective than

others?

15. How have you defined “life cycle” or “useful life” time

frames for infrastructure management and operations? 

112 | APPENDIX B
Do you calculate “remaining service life” as part of this

assessment?

16. Are you aware of protocols or requirements that mandate

life cycle costing in different jurisdictions in your

state/province?

17. For those projects with multiple assets (e.g., pavement,

lights, signals, signs, etc.), how have life cycle costs of

alternative project designs been calculated and used in

decisionmaking for large, long-term expenditures? 

Information Understanding and

Dissemination 

1. To what extent are asset management and the results of

your asset management program understood by senior

managers, mid-level managers, and other employees in

your agency? By key elected officials? By the general 

public? Did you make any special effort to educate these

groups on what asset management means to your 

jurisdiction?

2. How are the results of your asset management effort conveyed to agency and government decisionmakers, as well

as to the public? What lessons have you learned in this

effort on how to communicate such information in the

most effective way?

3. How is asset management data/information shared with

other units in your organization? Does your agency have

compatible data-sharing systems in place that allow other

organizational units to tap into the database for their own

purposes? 

4. If other jurisdictions (e.g., cities) want data on your

agency’s transportation infrastructure for their own planning purposes, is there a database they have access to? Is

this database provided in print and digital form? Is it

accessible via the Internet? 

5 . What type of research have you conducted to advance

the state of practice of asset management? In what areas

is additional research needed?

6. Does your agency provide training on asset management

to your staff and/or others? If so, what topics are included

in this training?

Benefits/Impacts of Transportation Asset

Management

1. Do you use any measure or indicator of performance of

your asset management function (in this case, we are

interested in performance of the asset management program, not of the transportation system)? Are resources

allocated within your agency based on achieving performance indicators? 

2. Have you evaluated the effectiveness of your asset management program? If so, what measures of effectiveness

have you used? What do you think have been the major

benefits of asset management to your agency, whether

they can be measured or not?

3. How effectively has the asset management staff function

competed for agency resources? Through the use of asset

management, how effective has your agency been in competing for resources?

4. Do you benchmark your asset management effort with

other agencies and/or jurisdictions? If so, what benchmark

measures are used?

5. Based on your experience with asset management, what

best practices would you recommend to other agencies?

TRANSPORTATION ASSET MANAGEMENT | 113
114 | APPENDIX B
TRANSPORTATION ASSET MANAGEMENT | 115

Appendix C:Asset Management

Job Descriptions 

Transit New Zealand

Principal Objectives 

To assist the Asset Management Team in managing the highway asset effectively and efficiently, including forward planning

and investigation of new initiatives to meet the objectives of

our stakeholders in accordance with Transit’s policies and procedures.

Person Specification

 The person who undertakes this position should have 

sufficient maturity and judgment to liaise effectively and be

accepted by senior managers and engineering staff of 

consultants, territorial authorities, roading industry, and our

customers.

Key Achievement Areas Performance Criteria

1. Coordinate and oversee priorities and programming of the 

various maintenance elements.

 Optimization of expenditure in the maintenance program.

 Arrange periodic reviews/audits/inspections (both technical

and expenditure focused).

2. Coordinate and audit network Annual Plans to maintain

integrity, consistency and facilitate the compilation of the

annual State Highway Program (SHP) 

 Quality outcomes recommended for funding in the SHP.

 National Ten-year program is prepared, reviewed, and 

realistic.

3. Review forecasts, budgets, cash flows, additional funding

requests, monthly reviews, and reconciliation of 

maintenance activities in the current program.

 Optimization of all maintenance and relevant capital 

expenditure within budget.

4.Assist with advice on the development and implementation of specifications and best practice guidelines.

 Regular liaison with other groups within the division 

(e.g., Engineering Policy and Traffic & Safety).

 Involvement in the development of implementation

plans/workshops for adoption of new/revised 

specifications/guidelines.

5. Manage specific asset management improvement initiatives from conception through to implementation (e.g.,

new condition measurement techniques, corridor asset

condition reporting, development and implementation of

new data management systems, national network risk

assessment and coordination, etc.)

 Identify improvement opportunities, particularly new 

innovative asset management initiatives.

 Develop project plans to scope new initiatives.

 Manage adopted improvement projects from inception

trough trials to full implementation.

Network Operations Division—Asset Management Section

Asset Engineer—Maintenance (2) Job Description

Effective Date: November 2004

Position: Asset Engineer—Maintenance (2)

Location: National Office, Wellington

Responsible to: Asset Management—Team Leader

Responsible for: Nil

Functional Regional Asset Staff

Relationships: National Office Staff

Local Authorities 

Network Consultants/Contractors

Industry Groups
Skills

 A proven ability to communicate clearly and concisely, both

orally (including presentation skills) and written word.

 Proven analytical capabilities. 

 A desire to think strategically.

 Given the extent of liaison with Transit and consulting staff

and the training expectation, must be highly 

proficient with the English language.

 Highly proficient with computing skills.

 Highly motivated.

 Ability to work under pressure and as part of a team.

 Requiring minimal specific motivation or leadership in 

progressing the key objectives of this brief.

General

 Transit New Zealand has a non-smoking office environment.

Staff must be able to work in that environment.

 The requirement to work a standard 40-hour week but

some key deliverables may require extra hours to ensure

key deadlines are achieved.

 The position will adopt the Transit General Conditions of

Employment, providing 4 weeks Annual Leave.

Qualifications and Experience Required

 Tertiary Engineering essential and Bachelor of Engineering

is highly desirable.

 Significant experience in roading and asset/maintenance

management.

 Experience in dealing with the public, public meetings, and

media.

 Knowledge of Transit’s policy and procedures.

 Driver’s license.

116 | APPENDIX C

Key Achievement Areas (continued) Performance Criteria

6. Promote and support the development of Transit asset

management systems.

Develop procedures/best practice guidelines/manuals for

asset management activities.

 Understand dTIM’s, RAMM and NOMAD, FWP, and other

asset management systems.

 Assist with the compilation of national data to improve the

utilization in the decisionmaking process.

 Evidence of systems being continuously being reviewed and

improved, as appropriate.

 Manage Transit’s Preventive Maintenance program.

7. Manage the engagement of consultants for professional

services contracts, invite proposals, and participate in the

evaluation of submissions.

 Quality documentation on time.

 Evaluations that conform to CPP requirements.

 Good leadership in tender evaluations for maintenance and

network activities.

 Input into project tender evaluations.

8. Review contract specifications and documentation for

physical works contracts.

 Consistent physical works documentation complying with

Transit’s standards. (SOMAC).

 No justifiable complaints on contract documentation from

industry.

9.Arrange audits/reviews of regions against national standards/achievements and consistency across regions.

Promote the review and assessment of regional and national

performance associated with all maintenance activities.

 Visit network areas on a regular basis to review management of the asset.

 Operate relevant sections of Transit’s internal audit system.

 Transit and road users are getting value for money.

 Transit’s standards criteria and guidelines are met.

10.Attend liaison and industry meetings, and develop relationships and partnership building.

 Transit is held in continuing high regard as a result of Asset

Engineer’s actions.

11. Facilitate the transfer of good ideas developed at a regional

level across the organization.

 Improvement initiatives are championed across the whole

business.

 Regional business practices are improved to reflect the

revised methodology.

12.Assist the Asset Management Team Leader and Network

Operations Manager with tasks.

 Willing to take on tasks assigned.

 Preparation of Business Plan activities and ensure they are

scoped, project plans prepared through to a successful 

completion of the initiative.
TRANSPORTATION ASSET MANAGEMENT | 117

Principal Objectives 

1. Champion the use of leading-edge maintenance processes.

2. The day-to-day management of the state highway network

in the Nelson-Tasman area to achieve Transit New Zealand’s

objective for a safe and efficient highway operation.

3. Assisting the Regional Asset Manager in other areas of 

network maintenance, policy, budget, and improvements to

improve the regional management of the network.

Effective Date: July 2002

Position: Regional Maintenance Engineer—

Wellington

Location: Wellington Regional Office

Responsible to: Regional Asset Manager

Responsible for: Graduate (to be appointed)

Budget: Approximately $6 million 

(as contained in the NRP)

Network: Approximately 393 

kilometers

Functional Transit Wellington Staff

Relationships: Transit Staff Head Office and Regions

Consultancy Staff

Contractors

Territorial Authorities

Key Achievement Areas Performance Criteria

Structural Bridge Maintenance

 Manage the Structural Bridge Contracts in Nelson,Tasman,

Marlborough, and Wellington areas (from May 2003).

 The bridge assets are maintained in sound condition.

 Inspections and asset maintenance programme are completed annually.

 Appropriate preventive maintenance is completed.

 Bridge asset management plan objectives are achieved.

Overweight Policy

 Administration of Transit overweight policy.  No variations from policy.

 Kept abreast of current issues.

Regional DTIMS Expert

 To champion the implementation of DTIMS modelling as a

pavement determination prediction tool.

 Kept abreast of current issues.

 Continuous improvement of local models.

Competitive Pricing/Procurement Initiatives

 Local champion of CPP and participation on evaluation

teams as required. Pursue trials as appropriate.

 Procedures adhered to.

 Unit standards acquired.

 Prequalification trial implemented.

 Full implementation of PACE.

Management and Leadership of Graduate

 To plan, organise, lead, and control the work of staff

employed in a manner which ensures the person feels valued and is motivated to contribute to the achievement of

Transit’s mission and goals in the region.

 Staff performance evaluations completed as required.

Asset Team Coordination

 Coordinate region 9 and 10 responses to Head Office to

ensure they are consistent, to a high standard, and timely.

 All deadlines are met.

 Responses are consistent and to a high standard.

Strategy Studies

 To assist the Regional Asset Manager in developing highway

corridor strategy studies across the regional network.

 Strategies are soundly based and reflect the National State

Highway and Transit objectives.

 Stakeholders are consulted and brought into the strategy

where practical.

Regional Maintenance Engineer Job Description
Key Achievement Areas (continued) Performance Criteria

Asset Management

 The management and delivery of pavement intervention

strategy, resealing and asphalt, rehabilitation and area-wide

treatment, drainage maintenance, preventive and emergency

work repairs, and incident and emergency response 

programs.

 Pavement intervention strategy, Nomad and ten-year 

programme are current and robust.

 Appropriate levels of funding are sought. Levels of service

are appropriate or have strategic implementation plans.

Priorities have been considered.

 Performance targets in the Statement of Intent are achieved

or satisfactory explanations are provided.

 To manage the impact of the network on adjoining

landowners and road users.

 Complaints and enquiries are investigated, evaluated and

actioned.

 To set performance targets in accordance with the

Statement of Intent.

 Performance targets are achieved or satisfactory explanation

provided.

 To engage legal and other professional advice as required.  Appropriate resources are available.

 To carry out an appropriate level of inspection of the 

network so that the consultants and contractors can be

audited for performance and levels of service can be

assessed.

 The entire network is covered each quarter and additional

inspections are carried out as necessary.

 Transit and road users get value for money.

 No justifiable complaints from road users.

 To participate in the formulation of local policies and 

procedures.

 Satisfactory performance on local working groups.

 To manage technical audits and participate in technical

audits in other regions. Audit outcome satisfactory.

Audit outcome satisfactory.

Programming and Work Planning

 Manage the preparation of forecasts and annual plans,

determine priorities and programming for the 

implementation of maintenance, sealing, shape correction,

flood damage, and safety works.

 Optimization of expenditure in the maintenance program.

 Annual plan preparation meets Head Office timetable and

quality expectations.

 Ensure monthly accrual information is accurate and within

budget.

 On time meeting Head Office timetable.

 To provide continuous (for items allocated in Proman) 

management of budgets, accruals, and forecasts.

 Financial reports are provided to management on time,

surpluses and deficits are handled promptly, budgets are

established at beginning of the year and program is delivered without substantial unjustified variance to budget.

 The February end-of-year forecast is achieved with ± 1.5%.

 To ensure that sufficient funding is held for all contracts to

be completed.

 Action allocation adjustments so that contracts can be paid.

 To manage contract payments.  Payments are timely and do not incur interest or complaint

from service providers.

Identification of Asset Improvements

 Identification and preliminary investigation improvement

projects.

 Priorities and needs identified are transferred into the annual plan.Worthwhile projects are identified and developed.

 Inventory of improvement projects always up to date, and

new opportunities proactively identified.

118 | APPENDIX C 
Person Specification

Age

Sufficient maturity to liaise effectively with senior managers

and engineering staff of consultants, territorial authorities,

roading industry, and the general public.

Qualifications and Experience

A professional engineer with ten years’ and above roading

experience and meeting the requirements to qualify for membership to IPENZ. Experience in roading construction and

maintenance required. Knowledge of Transit New Zealand

policies and procedures required. Experience in dealing with

the general public, public meetings, and media would be an

advantage.

Personality and Temperament

Sense of response, maturity, and judgment. To be accepted in

this role by technical staff and consultants.

 Dedication to Transit’s Mission Statement.

 Ability to work amicably with all personnel.

TRANSPORTATION ASSET MANAGEMENT | 119

Key Achievement Areas (continued) Performance Criteria

Team Leader Nelson-Tasman

 To coordinate leadership of Transit’s maintenance team.  The inputs into Transit’s management of the Nelson-Tasman

region Network Consultant contract are consistent and are

of a high professional standard.

 Actions required by the client are directed to the 

appropriate person and carried out in a timely manner.

 The consultant cannot fault Transit’s performance in terms

of timely delivery of responses.

 Performance targets in the Statement of Intent are achieved

or satisfactory explanations are provided.

 Overview of network fees.  Fee funding request is justified.

 Financial target for network fees is achieved.

 Management of annual plan preparation.  The Annual Plan is delivered on time to Head Office.

 The requests are clearly justified and substantiated.

 The request meets the funding needs for the following year.

 Responsible for the management of monthly meeting with

Network Consultant.

 The monthly meeting is managed in an efficient manner,

feedback is communicated on performance.

 Maintenance activities are monitored monthly with any

issue being identified and a process for their resolution

being defined.

Asset Information 

 To manage the development and updating of inventories

and databases, including production of SH valuation

required for asset management.

 Appropriate tools and systems are in place to provide

appropriate asset information.

 Information is accurate and retrievable.

Other Duties

 Carry out national duties and other tasks as may be assigned

from time to time.

 Participate in national working groups as required.

 Carry out other duties and tasks as may be assigned from

time to time.

 Exhibit willingness to undertake additional tasks and complete as required, having identified any resource limitations

and impact on other work.

 Complete tasks to agreed time, quality, and cost targets.

Working Together

 Work together in a team environment where information 

is shared, colleagues are supported, encouraged and 

respected.

 Positive contribution at all times.
 Possess good computer skills and knowledge of software

packages.

 Knowledge of a related engineering field essential.

 High standard of written and oral presentation, especially

language skills.

 Good liaison skills.

Skills Required

Ability to:

 Analyze technical and financial roading proposals.

 Report on problems and proposals clearly and concisely,

both orally and in writing.

 Recognize need for appropriate proactive communication

strategies. 

 Identify performance of the state highway network, both in

total and by individual site, by inspection supplemented by

performance records as available.

 Identify improvements to technical and administrative 

policy.

 Show a high level of initiative and a flair for innovative

approaches.

General

Transit New Zealand has adopted a nonsmoking office policy so that this person must be able to work in that environment.

A driver’s license is essential.

120 | APPENDIX C

Principal Objectives

1. To manage the safety and integrity of the Wellington 

regional state highway network.

2. To manage consultants employed on projects where 

nominated as sponsor.

3. To ensure the roading industry, local authorities, and public

are proactively consulted in relation to Transit’s state 

highway business.

4. To deputize for the Regional Manager in his/her absence.

Position: Regional Asset Manager

Location: Transit New Zealand Wellington 

Regional Office

Responsible to: Regional Manager

Responsible for: Area Engineer(s)

Road Safety Engineer

Administration Assistant

Highway Superintendent

Functional Regional Staff

Relationships: Head Office Staff

Local Authorities

Contractors and Consultants

Iwi

External Stakeholders

Public and interest groups

Regional Asset Manager Job Description

Key Tasks Performance Criteria

1. Determine priorities and programming for the implementation of maintenance, sealing, shape correction, flood 

damage, safety works, and construction projects

 Optimization of expenditure in the maintenance program.

 Quality projects recommended for funding in the Regional

Land Transport Program.

2.To develop and publish approved highway corridor 

strategies across the regional network.

 Strategies are soundly based and reflect the National State

Highway and Transit’s objectives.

 Stakeholders are consulted and brought into the strategy

where practical.

 Strategies are developed efficiently, reflect input by Transit

staff, and are expeditiously finalized and presented to the

Authority for approval.

3. Ensure that a strategy is implemented to continually identify

improvement projects.

 Inventory of improvement projects always up to date, and

new opportunities proactively identified.

4. Manage the preparation of forecasts, reviews and reconciliation of state highway works and fees programmes.

 Optimization of expenditure within budget.

 Input of Regional Projects Group into preparation/management of NRP is optimized (noting that accountability for delivery of capital projects is held by Regional Projects Manager).
TRANSPORTATION ASSET MANAGEMENT | 121

Key Tasks (continued) Performance Criteria

5. Ensure monthly accrual information is accurate, within

budget, and forwarded to programming section.

 On time for Authority meeting timetable.

6.Where nominated as project sponsor.  Staff develop full potential.

 Staff fully aware of expectations. High productive output

achieve.

 A demonstrable passion to “go faster”on project delivery.

 Evidence of satisfactory liaison with Local Authorities, Iwi,

and other key stakeholders.

 Proactive relationships with the media.

7. Provide input, and manage where appropriate, business

improvement processes both within the Regional office

and across Transit New Zealand.

 Initiative demonstrated where opportunities for 

improvement are identified.

 Input into improvement projects is valued by other Transit

staff.

 Input is provided in constructive and timely manner.

 Seek appropriate training and expansion of skill base.

8. Organise the preparation of documentation and briefs for

engagement of consultants for professional services contracts, invite proposals, assist in evaluation of submissions

as a member of tender evaluation team.

 Quality documentation on time.

 Evaluations that conform to CPP procedural requirements.

9.Audit consultants’ and contractors’ standards and performance associated with the execution of routine maintenance, bridge repairs, shape correction, sealing works, and

major projects.

 Traverse highway network at least twice a year.

 Transit and road users getting value for money.

 No justifiable complaints from road users.

10. Manage handover inspections with consultants for all

shape correction, safety, and construction projects.

 Transit’s standards criteria and guidelines met.

11. Liaise with territorial authorities who manage state highways under delegation on a day-to-day basis in terms of

the delegation agreement.

 No justifiable complaints from local authority engineers.

12. Respond to industry and public enquiries and complaints.  Enquiries and complaint answered within 2 weeks.

13. Carry out other duties as may be allocated from time to

time.

 Exhibit willingness to undertake additional tasks and complete as required, having identified any resource limitations

and impact on other work.

14. Deputy for regional manager.

15. Carry out national duties and other tasks as may be

assigned from time to time.

 Participate in national working groups such as best practice

groups.

 Complete tasks to agreed time, quality, and cost targets.

16. Participate in the regional management team.  Active support and participation in the Regional

Management team and Transit Development Forum.

Person Specification

Age

Sufficient maturity to liaise effectively with senior managers

and engineering staff of consultants, territorial authorities,

roading industry, and the general public.

Qualifications and Experience

A registered engineer is highly desirable. Experience in 

roading construction and maintenance required. 

Knowledge of Transit New Zealand policies and 

procedures required. Experience in dealing with the 
122 | APPENDIX C

general public, public meetings, and media would be 

an advantage.

Personality and Temperament

Sense of response, maturity and judgment. To be accepted 

in this role by technical staff, consultants, local and central

government politicians.

Skills Required

Ability to:

(a) Analyze technical and financial roading proposals.

(b) Report on problems and proposals clearly and concisely,

both orally and in writing.

(c) Recognize need for appropriate proactive communication

strategies. 

(d) Identify performance of the state highway network, both in

total and by individual site, by inspection supplemented by

performance records as available.

(e) Identify improvements to technical and administrative policy.

(f) Show a high level of initiative and a flair for innovative

approaches.

General

Transit New Zealand has adopted a nonsmoking office policy

so that this person must be able to work in that environment.

A driver’s license is essential.
TRANSPORTATION ASSET MANAGEMENT | 123

Maintenance Annual Plan

Contents

Maintenance Annual Plan Confirmation

Network Statement

Maintenance Summary Schedule

Appendix 1 Pavement Maintenance

Appendix 2 Area Wide Treatment (AWT)

Appendix 3 Major Drainage Control

Appendix 4 Maintenance Chip Seals

Appendix 5 Thin Asphaltic Surfacing

Appendix 6 Seal Widening

Appendix 7 Bridge Maintenance

Appendix 8 Amenity Safety

Appendix 9 Street Cleaning

Appendix 10 Traffic Services

Appendix 11 Carriageway Lighting

Appendix 12 Cycleway Maintenance

Appendix 13 Professional Services

Appendix 14 Preventive Maintenance

Appendix 15 Pavement Smoothing

Appendix 16 One-off Maintenance Requests

Appendix 17 Maintenance Forward Works Programme

(NOMAD)

Appendix 18 Pavement Deterioration Modelling

Appendix 19 Safety Proofing

Appendix 20 Changes to Levels of Service

Appendix D: Network 

Management Area Plan

Transit New Zealand

PSMC001

Network Management Area

2005/2006 & 2006/07

Two-Year Plan

Maintenance Annual Plan Checklist

Items Have Been Checked/Included Tick Box

Signed Confirmation Page 

Network Statement 

Summary Maintenance Schedule 

Maintenance Funding Schedules for each Work

Category with supporting documentation

(Appendices 1-16)



Maintenance Forward Works Programme

(NOMAD Report and Graphs)—Appendix 17 

Pavement Deterioration Modelling—

dTIMs report—Appendix 18 

Changes to Levels of Service—

Appendix 19 (signed) 

All Schedules submitted electronically to Transit

National Office 

All above items included

Signed _________________________ Date_____

Transit Area Engineer

Maintenance Annual Plan Confirmation The status of this document is confirmed on this page.

Consultant Approved Programme

Prepared by: Richard Parsons ______________

Name

____________________________________________________________ ______________

Signature Date

Reviewed by: Brennan Daly ____________

Name

____________________________________________________________ ______________

Signature Date

Approved by: Mike Keir __________________

Name (Team Leader)

____________________________________________________________ ______________

Signature Date

This by 30 September 2004

Consultant Approved Programme accepted by Transit

Accepted by: Gerrit van Blerk

Area Engineer

____________________________________________________________ ______________

Signature Date

Endorsed by: Ian Cox

Transit Regional Asset Manager

____________________________________________________________ ______________

Signature Date

This by 31 October 2004

Has the Regional Manager endorsed the content of this Annual Plan? 

124 | APPENDIX D

1. EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . .33

2. NETWORK DESCRIPTION . . . . . . . . . . . . . . . . . . . . . . . .34

2.1 Pavement Formation . . . . . . . . . . . . . . . . . . . . . . . .35

2.2 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37

3. ISSUES AND GOALS . . . . . . . . . . . . . . . . . . . . . . . . . . . .37

4. NETWORK CONDITION & ACHIEVEMENT OF 

CONTRACT KEY PERFORMANCE INDICATORS . . . .39

4.1 Surfacing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39

4.2 Pavement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40

4.3 Pavement Defects Report . . . . . . . . . . . . . . . . . . .42

5. ASSET MANAGEMENT PRACTICES AND 

STRATEGIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44

6. CURRENT CONTRACTUAL COMMITMENTS . . . . . . .45

7. TRAFFIC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45

8. ROAD USER SAFETY . . . . . . . . . . . . . . . . . . . . . . . . . . . .46

9. MODELLING & THE 10-YEAR FORWARD 

WORKS PROGRAMME . . . . . . . . . . . . . . . . . . . . . . . . . .47

9.1 Modelling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47

9.2 The FWP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48

Table of Contents
The PSMC 001 network is managed 

and maintained under a performance specified maintenance

contract (PSMC). This provides for the maintenance of the

network within the limits set by the PSMC performance

regime and for this to be achieved for tendered Lump Sum

payments.

In 1998 Transfield Services and its supplier partners made a

detailed study of the State Highways that comprise the PSMC

001 network. Following this a 10-year network management

plan was developed and costed. This was prepared in a competitive commercial environment with little capacity for conservatism or contingency. This formed the basis of the successful tender for the management and maintenance of this

network.

It is noted that six years have elapsed since the preparation of

that plan. Over this time there have been significant changes

in the roading industry, and the expectations of key stakeholders; however, it is noted that Transfield Services continues

to deliver better than the contract requirements in the key

performance measures. In the reporting of network performance we show how the network compares with national average values as well as the contracted requirements for this

contract. It should be noted that the national values are

derived from networks with varying management regimes,

contract performance requirements, and levels of financial

control.

Further there have been other benefits achieved over the 

contract to date, including an appreciable strengthening of

the network pavements and a reduction in the social cost of

crashes occurring in the network. These achievements are

being delivered within maintenance and management budgets that were prepared in 1998.

This document has been prepared to comply with the requirements of Transfund and Transit New Zealand. It sets out our

intentions and recommendations for the financial years

2005/06 and 2006/07. It has been prepared as a part of The

Transit New Zealand trial of Two-Year Network Maintenance

Plans. In it we have taken into account our contractual commitments for cost and levels of service provision. We then

combined this with the philosophy outlined in Transfund’s

National Land Transport Program of providing the most costeffective strategy in the medium to long term together with

Transit’s vision of a transport system that builds a better New

Zealand and with the aims of Land Transport Management

Act 2003.

This annual plan also utilises the lessons learnt in the five and

a half years the PSMC has been operating. We believe that it

is in the later stages of the PSMC that the effects of ownership will come to the fore and demonstrate the effectiveness

of the PSMC procurement model. Key initiatives in this

include:

 The use of our PSMC001 PARMMS pavement model to

deliver a cost-effective strategy that will meet or exceed the

KPI requirements of this contract as well as form a very

good understanding of the network and its issues. 

 Specifically with regard to water and drainage issues and

the instigation of discrete drainage projects on targeted

sections of the network. 

This annual plan also contains requests for improvements to

the network above the requirements of the Lump Sum scope

in the form of: 

 Major drainage improvements to provide increased network

availability through the reduction of flooding (see Appendix

3: Major Drainage/Flooding mitigation SH31/30))

 Seal Widening improvements to address safety and reduce

future maintenance costs (See Appendix 2: AWT)

 Preventive Maintenance candidate projects 

(See Appendix 14: Preventive Maintenance)

 Addition to the contract payments arising from the full

implementation of Transit’s Code of Practice for Temporary

Traffic Management (See Appendix 1: Pavement

Maintenance)

TRANSPORTATION ASSET MANAGEMENT | 125

1. EXECUTIVE SUMMARY
The map below shows the full

PSMC001 network.

The PSMC001 network incorporates 3 Regional Councils

(Waikato, Taranaki and Manawatu-Wanganui) and 6 District

Councils (Waipa, Waitomo, Otorohanga, Ruapehu, Waikato,

New Plymouth).

Traffic volumes vary from 250–5,000 vehicles per lane per day

across the network. We have a higher-than-expected HCV

growth on certain sections, notably SH 30, 31, 39, and 3

South. Section 7 of the Network Statement provides further

detail on the traffic profile for these areas.

For the purposes of Temporary Traffic Management at worksites, the bulk of the network is designated CoPTTM Level 1

with the portion of SH 3 from Hamilton Airport turnoff to Te

Awamutu being CoPTTM Level 2 (approximately 19 km).

2.1 Pavement Formation

The highways on the network consist typically of granular

pavements, some with a degree of modification, with thin

bituminous surfacings. Pavement materials are moderate

crushing strength greywackes, with minor amounts of plasticity, varying in depth from 100 mm to 800 mm. There is a supply

issue within the region for quality basecourse material. This is

compounded by the fact that many of the subsoils throughout

the network do not lend themselves to supporting cement

stabilised pavements.

The climate can be described as wet temperate with annual

rainfall averages ranging from 1,200 mm to over 2,600 mm

across the region. 

Each highway of the network has different characteristics and

is described separately as follows:

State Highway 3

SH 3 is part of a strategic link along the west coast of the

central north island and its operation is seen as critical to the

health of the Taranaki economy. A special interest group, the

SH3 Working Party, has as its principal objective the promotion of roading improvements to SH3 between New Plymouth

and Te Kuiti and the protection and enhancement the northern Taranaki corridor as a strategically important route. The

group is comprised of representatives of district and regional

councils, Transit New Zealand, Transfield and road users, and

is convened by Taranaki Regional Council. 

SH3 passes through terrain ranging from rolling pastoral in

the Waikato to the steep terrain in and around the Awakino

Gorge and Mount Messenger. The restrictions created by the

latter two geological features, including two tunnels, have a

significant effect on alignment, safety, and travel time. The

topography and underlying subsoils, particularly the

Mahoenui Mudstone, in the King Country are unstable and

susceptible to heavy rain and periods of prolonged wet

weather, both common conditions experienced within the

region. 

State Highway 39

SH 39 travels through rolling Waikato farmland and up until

January 2001 was part of the Local Territorial Authority roading network. The highway was designated as a State highway

126 | APPENDIX D

2. NETWORK DESCRIPTION
at that time in recognition of the role that it plays in providing

a western bypass to the Hamilton Urban area.

State Highway 4

SH 4 travels through the rugged King Country and

Taumarunui hill country. When the topography around SH 4 is

not steep hill country the road is generally sitting on a flood

plain. To the north, the road is near the Mapiu and Mapara

Streams, which are bedded in large mudstone alluvial flood

plains and to the south the highway sits on the Ongarue River

flood plain, which is comprised of soft pumiceous and silty

alluvials that erode very readily.

State Highway 30

SH 30 near to Te Kuiti is dominated by the karst environment,

with subsidence in the pavement common. Further east, the

road is built on volcanic terrain and is often affected by the

sensitive clays formed from ash deposits. 

State Highway 31

SH 31 travels through rugged hill country from the 

intersection with SH 39. The topography is very steep and

the underlying geology of Te Kuiti Group has formed 

steep bluffs very close to the road’s edge in many sections

of the highway. Volcanic deposits from Mount Pirongia 

cap the Te Kuiti Group and are readily erodible when 

saturated.

State Highway 37

While SH 37 is surrounded by the karst topography of

Waitomo, the highway travels through easy undulating country

and provides an important tourism link to the Waitomo Caves.

It is in reasonable condition for its current traffic loading.

2.2 Summary

The network also forms part of an alternative route to SH 1

through the centre of the north island via SH 39, 31, 3, and 4.

Both SH 30 and SH 31 have experienced significant heavy

traffic growth due to production forests coming on stream for

harvest and have had large capital investment in upgrading

pavements to cope with this. While treatment to date has

been successful, ongoing investment levels need to be maintained. Section 7 of the Network Statement and Appendix 1:

Pavement Maintenance elaborates further on this issue. 

As detailed above, the network is a challenging one with a

range of difficult conditions and issues that have been managed and/or mitigated as part of the PSMC001 Network management strategy and compilation of this 2-year Annual Plan

(and associated 10-year forward Works Program).

TRANSPORTATION ASSET MANAGEMENT | 127

Item Question Unit Result Comments

Network Description

Dimensions

Length of road network Km 449.7

Centre line Km

Length of rural road Km 424.3

Length of urban road Km 25.4

Length of Motorway Km 0

Length of Expressway Km 0

Contracts

Number of maintenance contract areas No 1

Procurement type Text PSMC

Topography Predominant topography Text Rolling

Traffic Data

Typical urban AADT AADT 5,200

Typical rural AADT AADT 2,500

Historic 5-year AADT growth % 1.4% Plus/minus 2.2%

Typical urban HCV % 14% Estimated

% 17% Estimated

Network Condition

Corrdor Acceptable

Table 1. Current Network Statistics
Preventive Maintenance

The Waikato/Bay of Plenty Transfund Representative has

endorsed the sites put forward in Appendix 14 of this BiAnnual Plan. Cost-effective solutions have been promoted to

ensure that least-whole-of-life cost options, network security,

and safety are maintained. It is likely that the highway infrastructure will be exposed to long-term damage if the proposed strategy is not implemented.

Heavy Commercial Traffic Growth

HCVs on SH 30 (mostly logging related) are still 

contributing to rapid deterioration of pavements. Also, 

SH 39 is showing signs of distress due to increased HCV

loading related to its designation as a state highway and

this is expected to increase significantly with forestry 

blocks coming on stream in the near future. The Contract

Lump Sum caters for HCV traffic growth up to 5 percent

annually. This risk profile boundary has been exceeded 

on SH 30, SH31 (East/West Sub-Network), and SH39 

(SH39 Sub-Network). Section 7 of the Network Statement

and Appendix 1: Pavement Maintenance elaborates further

on this issue.

CoPTTM Compliance

In 2001 Transit introduced its new Code of Practice for

Temporary Traffic Management. At that time an assessment

was jointly made of a practical level of implementation. This

included working with less than the specified levels of control and not following the Transit classification of the section

of SH 3 north of Te Awamutu as Level 2. Since that time the

roading industry has moved to a higher level of compliance.

As such the interim standards agreed in 2001 are no longer

applicable. Further, the section of Level 2 road has not been

reclassified (less than minimum length recommended). As a

result, we must alter the funding application to suit full

requirements of CoPTTM. The details of the merits of this

claim and the calculation of its actual value shall be

through the regular contractual mechanisms. It has been

included in this Plan in order that Transit may take this into

account in its future funding planning.

128 | APPENDIX D

3. ISSUES AND GOALS

4.1 Surfacing

Skid Resistance

The plot to the right shows that the skid resistance below

threshold measure is better than the national average for the

first time in seven years.

Historically maintaining good skid resistance across the

PSMC001 network has been difficult due to the fact that

the best locally sourced sealing chip has only achieved a

PSV of around 52-53. The locally crushed material was 

predominantly elongated as a result of the type of crusher

typically used in the region. This chip had been used 

for all sealing prior to 2002. 

4. NETWORK CONDITION AND

ACHIEVEMENT OF CONTRACT KEY

PERFORMANCE INDICATORS
Since that time, there has been a determined strategy by the

PSMC001 team to improve the performance of our seals in

terms of skid resistance. This strategy has included:

 A change in chip source, improving both shape and PSV.

The PSV values have increased from 52 to 54, which is only

moderate. It is the combination of this with the increase in

ALD/AGD ratio that we expect to deliver better skid resistance properties.

 Change in bitumen type and application rate. We use

80/100 bitumen (rather than 180/200) for all reseals 

and first coat seals on the network. We have also 

aimed to reduce bitumen application rates as much 

as practicable—both in strategic response to the 

historical flushing problem that has hampered the

PSMC001 region.

 A change in works prioritisation to include improvement of

network skid resistance as a priority. Given the focus that

Transit has placed on skid resistance over the past few

years, we have included this factor in our prioritisation of

rehabilitation work. 

Based on the trend for improvement evident in the graph

above, this strategy appears to have been successful in delivering a safer network for the road user. This strategy will be

continued with the 2005/06 and 2006/07 programs, in order to

extract further benefits.

The above graph is used to track and monitor PSMC001 performance against the Network Management contract Skid

Resistance Key Performance Indicator (KPI). The data reported on above is sourced from the SCTIM survey conducted by

WDM. It is noted that these are less restrictive than the

National values and that the network is performing better

than the contracted requirements.

The same trend is evident on the National Condition graph as

shown at the top of the next column.

The plot below shows that the percentage of the network texture depth <0.5 mm measure is worse than the national average by 0.05 percent; however, this has been showing a trend

for improvement over the last few years. The sealing strategy

described above has also been utilised towards the reduction

of the network area that is low on texture.

Because there is a high proportion of our 2003/04 sealing

program that was completed after the network surveys, we

expect this trend for improvement to continue next year. 

4.2 Pavement

Roughness

The plot on the following page shows that the average

roughness for the network exceeds the national 

average by a 6.1 NAASRA counts at present. The plot 

also shows that the network average roughness has 

been reduced by 7.5 NAASRA since 1999, whereas the 

national average roughness reduction in the same 

period is 1.4 NAASRA. 

TRANSPORTATION ASSET MANAGEMENT | 129
This rate of improvement is a significant achievement, yet it

has been possible only as a consequence of the poor state of

the network at the commencement of the PSMC001 contract.

The network condition has stabilised to an extent and it is not

likely that we will provide further improvements in average

roughness. That being said, we expect to see incremental

annual improvements in roughness as a result of PSMC001

contract commitment to rehabilitate 50 percent of the network

area through the life of the contract. Our current modeling

output and forward works program predict a handover average network roughness of 72 NAASRA counts.

The graph below is used to track and monitor PSMC001 performance against the Network Management contract Mean

Roughness Key Performance Indicator (KPI). As is indicated,

all KPIs in this category have been met to date, with the forward works program for 2005/06, 2006/07, and future years

set at continuing to meet this requirement.

While we do not expect that our network average roughness

will close in on the national average, we will continue to

monitor and treat areas of high roughness (big bumps) as

part of our pavement management strategy. We have

reduced these areas by 65 percent since the start of the

contract and we aim to continue the trend of improvement

shown by the graph below. 

This type of roughness creates short bursts of highly 

uncomfortable travel for road users, which lead to a very

poor perception of overall network condition. Through the

timely treatment of such problems, we aim to minimise the

occurrence of discomfort and condition perceptions.

The graph above is based on data sampled by PMS during

early 2004, and suggests that there is an increasing trend in

the incidence of rough bursts on the network. This is contrary

to the WDM information as supplied by Transit, though this

may be related to the difference in timing of the surveys. We

will monitor this effect over the course of the next 12 months

and ensure that this trend, whether real or perceived, is not

allowed to continue.

Rutting

Based on the Transit National Survey graph below, the

PSMC001 network is shown as drifting out on the length of

130 | APPENDIX D
rutting greater than 20 mm deep. While it is noted that this

trend is in some way contributed to by a change in the setup

of the measurement vehicle (as noted in the State Highway

Network Condition Report 2004), it is consistent with our

understanding of network behaviour. Consideration should

also be given to the scales involved. The network appears to

be 0.2 percent worse than the national average. This equates

to 900 m of carriageway. 

The second plot below is used to track and monitor PSMC001

performance against the Network Management contract Rut

Depth >20 mm Key Performance Indicator (KPI). As is indicated, all KPIs in this category have been met to date, with the

forward works program for 2005/06, 2006/07, and future years

set at continuing to meet this requirement.

Notwithstanding the fact the network is in better condition

than is required by the contract, we would like to address the

recent deterioration. We have completed a recent study on the

difference in rut depth values between the inner and outer

wheel path. This study found a high degree of correlation of

sites with a high rut differential to those sites with poorly

functioning drainage. These sites contained a high proportion

of the ruts over 20 mm in depth. For the 2004/05, 2005/06,

and 2006/07 seasons, we have programmed a large-scale

drainage reinstatement package (Lump Sum activity) and

continue with our rehabilitation work to correct the increase in

rutting.

Granular Overlay Deficit

One of the key issues of a long term Performance Specified

type contract is ensuring that the contractor continues to

invest in the network and does not just consume the investments that have been made previously. Transit covered this

particular risk by including a performance measure of the

structural integrity of the pavements, called Granular 

Overlay Deficit.

The granular deficit measure was developed to indicate the

structural health of the network. The measure, using deflection and curvature information from a falling weight deflectometer (FWD) with traffic data, then calculates the nominal

volume of granular overlay required to produce a 25-year

design life using the Austroads Pavement Design Guide procedures.

After almost 6 years of the PSMC001 operation, the effects of

the implementation of the PSMC001 Forward Works programme are measurable. The pavement of the Network is

substantially stronger than at the start of the contract. The

granular deficit has been reduced by almost 150,000 cubic

metres (m). 

Note that the relationship used to calculate the information

used on the above graph is different to that nominated in the

contract. This is due to the potential for interpretation included

with the contract specified method. It is highly sensitive to

pavement profile information and given the paucity of this type

of data, we have proposed to use this simpler method. Note

that we have recalculated the baseline and network target 

figures using this same method. The PSMC001 Management

Board is currently considering this new methodology.

TRANSPORTATION ASSET MANAGEMENT | 131
4.3 Pavement Defects Report

Pavement Issues

There continue to be issues with pavement repairs throughout

the network with the worst affected area being SH3, south of 8

Mile Junction (SH4). This problem is a complex one and is related to basecourse quality, topography, climatic conditions, subgrade standard, and increases in heavy vehicles. Internal Task

Groups have been set up to investigate and enhance patching

methodologies and techniques, including surface finishings. 

Given the range of causal factors it is difficult to come up with

a simple one-size-fits-all solution. Rather, we are working on a

range of methods to target this problem, including incorporating pavement repairs into our rehabilitation strategy, training

staff in both design and treatment of repairs, and looking at

alternative treatment methodologies and materials. We have

moved to patching potholes with hotmix in dry conditions and

good quality premix in situations in wet situations. This has

seen a significant improvement in the life of these repairs in

wet and adverse conditions.

We are still well in front with KPIs for roughness and rutting

over the entire network; however, this year has seen both these

measures trend up in the South and East/West sub-networks.

This is seen to be related to the issues discussed above as well

as being drainage related. There will be an increased focus on

drainage works over the next two years, which when combined

with an improved pavement repair strategy should lead to further improvements in network KPIs for these sections. We will

continue to monitor these issues closely.

In terms of pavement management strategy, we have targeted

large-scale pavement strengthening. As part of our tender

commitment with Transit, Transfield Services is required to

complete 25-year-life reconstruction work on at least 50 percent of the network by area. This strategy has resulted in large

improvements in the network granular overlay deficit since the

start of the contract. Our challenge over the next few years is

to refine this strategy to help address the issues noted above

in reactive maintenance. 

Surfacing Issues

The 2004/05 rehabilitation program includes significant areas

of asphaltic surfacings, specifically on Mount Messenger and

in the Te Awamutu urban area. These areas have performed

relatively poorly and are only about 5 years old. 

Currently, there is relatively little asphaltic surfacing on the

network; however, with increasing traffic volumes and corresponding increases in surfacing stress levels, it is envisaged

that more isolated intersections will require such treatment in

the next few years. Due to minimum texture requirements and

increasing vehicle stresses, these treatments must be with

high PSV Stone Mastic Asphalt (SMA). We have already completed one such treatment in 2003/04 and currently it is performing well.

SCRIM remains an issue of the PSMC001 network due to the

high proportion of Category 2 sites combined with a lack of

top-quality sealing chip that may be sourced locally. Areas of

particular concern are SH 3 south of 8 Mile Junction and SH

4. Our management of SCRIM sites has adopted a practical

approach wherein we have made detailed site assessments in

conjunction with the SCRIM data prior to making any treatment decisions. This has lead to an improvement shown in

each of the last three seasons. 

In terms of treatments, the rehabilitation and resealing programs address the majority of SCRIM issues. We have certain situations that cater to water blasting; however, this

treatment is not seen as a permanent repair method.

Flushing returns within 12-18 months on most of our problem sections, due to the large amount of residual bitumen

that exists within our seals.

132 | APPENDIX D

In terms of the management of the

network, our maintenance behaviours are driven by 

Key Performance indicators (KPIs). There are KPIs that

apply to most of the activities performed by Transfield

Services against which we are assessed annually. Some 

of these KPIs have been presented above; however, there

are a total of 214 against which our performance is 

measured. In this number there is a degree of redundancy

that the project team has attempted to reduce and this

process of refinement will continue in the ensuing 

years. The KPIs are broken into three sections, which are

summarised on the following page.

5.ASSET MANAGEMENT 

PRACTICES AND STRATEGIES
Asset Performance Indicators

These indicators relate to the actual condition of the asset at

the time of measurement. They represent a snapshot of network condition and give an indication of the quality of the

product that is being provided. We have demonstrated a high

degree of conformance to the criteria in this section, as is evident from the information tabled above. There are measured

results of performance that exceed the contract minimum

requirements. Whilst this does equate to tangible benefits to

stakeholders, an assessment may be required to ensure this

investment is in the areas of best return.

Contract Performance Measures (Response Times)

These measures are a summary of the actual response times

to attend to various services as measured through the year.

Depending on the particular service, there is a maximum time

for response permitted under the contract and we are measured against this standard. For many of these measures we

demonstrate a high level of conformance, most notably in the

response to emergency incidents. We have received numerous congratulations from external agencies such as the police

and the Road Transport Authority for excellent services provided in incident response situations and this is an area of

pride for the contract team.

Management Performance Indicators

These indicators relate to the performance of the management team in contract reporting requirements and customer

enquiries. Generally the performance of Transfield Services in

this area over the past year has been good; however, we are

aiming to provide an improved level of service in terms of the

delivery of capital projects into the future.

TRANSPORTATION ASSET MANAGEMENT | 133

6. CURRENT CONTRACTUAL 

COMMITMENTS

The PSMC001 contract commenced on

11 January 1999 and has a ten-year performance based 

duration. A maintenance risk profile is included in the

PSMC001 contract, which defines what elements of risk are

borne under the lump sum, and which are borne by Transit.

Two items of maintenance funding in excess of the 

contractors risk profile are forecasted in 2005/06 and 

2006/07. These items are:

 Heavy commercial traffic growth above the specified 

threshold level (Appendix 1: Pavement Maintenance—

Miscellaneous Works)

 Implementation of Level 2 CoPTTM—TNZ Policy 

Change (Appendix 1: Pavement Maintenance—

Miscellaneous Works)

Escalation accrues annually and the PSMC001 lump sum

amounts reported in this annual plan reflect a prediction

being made that escalation of 17.6 percent will be due

through the course of the 2005/06 financial year, and 20.5

percent for 2006/07.

There have been 9 closures of the

SH 3 link in the past year and 5 of these were for under an

hour. All were slip, accident, or flooding related. No closures

were for more than 12 hours.

There are sections of the network that have experienced traffic growth rates higher than that of the maintenance contract

risk profile. We are still working on data on sections of SH 3

sites where initial indications show increases outside the risk

7.TRAFFIC
The network has seen a reduction in

the social costs of crashes over the last 5 years, from an 

average of over $30 million for the three years prior to the

PSMC to a $16 million average for the past four years, a 

nearly 50 percent reduction, significantly better than 

national trends.

Year PSMC 001 Social Cost National Highway Network

1996 $29,875,000 $768,853,000

1997 $35,609,000 $804,033,000

1998 $27,179,000 $657,281,000

1999 $25,566,000 $763,621,000

2000 $14,501,000 $663,033,000

2001 $19,345,000 $674,826,000

2002 $12,628,000 $599,438,000

2003 $17,316,000 $682,131,000

However, the management of the PSMC001 Network remains

firmly focused on locking this improvement in and gaining

further reductions. To this end we have carried out analysis of

the network crash history over the past three years. This information shows that the significant accident causal factors on

the PSMC001 network are:

Bends

Cornering and related accidents contribute to approximately

65 percent (53 percent last year) of our total accident rate.

The social cost of these accidents over the last three years is

valued at over $30 million. This is by far the largest factor in

accidents on our network. At present, the PSMC001 

contract is meeting its contract specified Skid Resistance

KPM requirements and a <% Below Threshold result less

than the National average. Regardless of these results, a

large focus of both the maintenance and improvement 

programmes is on driving down the accident rate 

experienced on bends. 

An example of programme optimisation and safety focus is

shown by the PSMC001 use of the Norsemeter ROAR variable slip skid resistance tester to study each skid category 2

corner on the network and rate each one on a probability

curve in terms of accident risk. We will then target these corners in a prioritised manner with treatments that will help to

reduce accident risk, complimented by the implementation of

minor safety programs, signage upgrades, vegetation clearing,

and enhanced recovery zones (e.g., Appendix 2: - seal widening associated with AWT). This ROAR Risk analysis process is

in the early sages of development with the methodology being

presented to the PSMC001 Management Board in late

October 2004. 

Vehicle Overtaking

Passing and head-on related accidents contribute to around

134 | APPENDIX D

8. ROAD USER SAFETY

profile of 5 percent. The Traffic Growth Report attached in

Appendix 7 details traffic growth statistics for SH 30, 31/0

(East/West Sub-Network), and 39 (SH39 Sub-Network)

Specific sections are summarised as follows: 

East/West Sub-Network

SH 30: Continued heavy traffic volumes outside the risk

profile due to logging have been recorded along this route.

This Two-Year Plan caters for the upcoming update to 

the current 2003 SH30 Traffic Risk Profile Exception 

Report. The report outlines extra costs incurred for extra

design/construction of pavements to cope with the

increased loadings and maintenance costs incurred 

above a baseline benchmark that have been 

incurred since July of 2003. 

SH39 Sub-Network

SH39 (and SH 31/0) has experienced increased heavy 

traffic due to State Highway designation status and 

resulting improvements made on the road. Transfield is

experiencing increased maintenance costs for this 

section that are over and above baseline maintenance 

costs and, where relevant, increased design costs.
15 percent (16 percent last year) of crashes on the network

with a social cost of $8 million for the three-year period 

2001-03. Transfield Services, in conjunction with Transit and

with the support of relevant local authorities, has pushed

through a program of passing lanes and passing lane 

extensions to try and address this issue. However, there are

additional sites proposed in the capital plan that are a key

part of this ongoing strategy. 

Intersections

Turning-related crashes account for approximately 5 percent

(10 percent last year) of all crashes. To try and further reduce

the number of intersection-related incidents, lighting improvements, pavement marking, signage, sight distance, and surface condition at intersections are taken into account when

developing maintenance (Lump Sum activities) and improvement programs (predominantly Minor Safety).

TRANSPORTATION ASSET MANAGEMENT | 135

9. MODELLING AND THE 10-YEAR

FORWARD WORKS PROGRAMME

(m) 2004/05 2005 2006 2007 2008 2009 2010 2011 2012 2013

Seal 37,000 29,800 28,400 24,500 25,000 26,000 24,300 24,700 26,400 26,600

AC 2,400 — 1,000 1,100 — — — — — —

REHAB 16,100 16,400 15,300 16,600 14,300 14,100 16,100 15,700 15,700 13,800

STAB 9,300 9,700 10,800 5,800 10,000 8,500 7,300 9,500 8,400 8,200

Overlay 2,200 2,300 600 400 1,200 1,200 3,800 1,800 1,500 800

R&R 600 400 1,100 1,500 1,300 200 200 300 1,300 —

Thin OLAY 4,000 4,000 2,800 8,900 1,800 4,200 4,800 4,100 4,500 4,800

9.1 Modelling

The project team has utilised PARMMS road manager as a

modelling tool since contract commencement. Transfield has

provided a commitment to deliver dTims output files to enable

the PSMC network to be incorporated within the National

Pavement Model.

Historically the PSMC 001 model has focused on satisfying

contract KPMs and long-term pavement performance. This

was achieved by assigning a high priority to the roughness

condition parameter, as roughness was considered to be the

best overall single indicator of the pavement condition. 

However there has been a non-programmed increase in isolated reactive pavement maintenance throughout the network.

The minimisation of routine maintenance was not a priority for

the earlier version of PARMMS road manager. It also did not

take into account the effect of drainage on pavement structural layers.

Significant work has been invested into the pavement model

this year to take account of both reactive pavement maintenance and drainage issues whilst still focusing on delivery of

KPMs and long-term pavement performance. The model has

also undergone significant field validation with operational

staff to provide a very strong field–modelling link. 

The PSMC001 model is treated as a live program due to the

need to:

 Deliver long-term pavement performance.

 Provide cost-effective site selection.

 Provide the flexibility to react to network needs (80 percent

committed).

 Allow for ongoing data input/communication between field

staff and the dedicated PARMMS modeller.

 Meet the obligations of the lump sum and deliver on business targets.

Please refer to Appendix 18, which contains the PARMMS

road manager pavement modelling report.

9.2 The FWP

This annual plan is based on a two year program, 2005/06

and 2006/07, which comprise years two and three of the 

current ten year FWP, which is included in Appendix 17.

The table below and graph (see following page) summarise

current predicted rehabilitation and reseal requirements to
2013. (Note: Reseal quantities after the coming season do not

include SCRIM seals, estimated at 5 km/yr, and risk-excluded

second coats, estimated at 7 km/yr.)

The rehabilitation figures shown above are made up from: 

 STAB (Stabilisation treatment)

 Overlay (Granular overlay treatment 120+mm)

 R&R (Rip & Remake Treatment)

 Thin OLAY (Overlay 75-120mm)

The philosophy behind our 2005/06 programs is to assist in

meeting contract KPIs with a strong emphasis on reducing

reactive pavement maintenance. This flows through into

2006/07 and future years. To this end the shorter sections

emerging from our model have been progressively incorporated into our works program.

The two-year FWP quantity for rehabilitation and reseals has

an 80 percent confidence level (when averaged over the two

year period). This is in contrast to expectations contained in

TNZ memo ST7-0013-Instructions to the 2-year Annual Plan.

Reasons for this deviation include climatic and geological

conditions, the reality of modelling methodology, “work

effects,” and the variation introduced from detailed site analysis prior to construction. An expansion of this rationale can be

found in Appendix 17 of the Support Supplement.

136 | APPENDIX D
(Reprinted by permission of the New South Wales Treasury)

1. TOTAL ASSET MANAGEMENT STRATEGIES

1.1 Guidelines for completing the TAM template

2. TOTAL ASSET MANAGEMENT STRATEGIES TEMPLATE

2.1 Results, services and corporate goals identified

2.2 Asset strategies developed

2.3 Asset performance measures and targets defined

2.4 Risk management strategies developed and 

documented

2.5 Capital investment strategy developed

2.6 Asset maintenance strategy developed

2.7 Asset disposal strategy

1. Total Asset Management Strategies

1.1 Guidelines for completing the Total Asset

Management template

The Template has been prepared to support agencies develop

their Asset Strategy and integrated Capital Investment, Asset

Maintenance and Asset Disposal Strategic Plans. Together

these form the agency’s Total Asset Management Strategies.

The template will assist NSW Treasury to assess the effectiveness of agencies’ strategic asset management through the

TRANSPORTATION ASSET MANAGEMENT | 137

Appendix E:Total Asset

Management Template 

New South Wales Treasury

This work is copyright. Apart from any use as permitted under

the Copyright Act 1968, no part may be reproduced by any

process without written permission from the NSW Treasury.

Requests and inquiries concerning reproduction and rights

should be addressed to NSW Treasury, The Executive Officer,

Level 27 Governor Macquarie Tower, 1 Farrer Place, Sydney,

NSW 2000. General inquiries concerning this document

should be directed to Arthur Megaloconomos (phone 9228

4402 or e-mail Arthur.megaloconomos@mail.treasury.

nsw.gov.au) of NSW Treasury. This publication can be

accessed from the Treasury’s Office of Financial Management

Internet site at http://www.treasury.nsw.gov.au/.

ISBN 07313 3325X Total Asset Management 

(set of six volumes)

ISBN 07313 32482

1. Asset management—New South Wales.

2. Capital Investment.

3. Public administration—New South Wales

I. Title. (Series: TAM 2004)

Table of Contents

quality of their Total Asset Management (TAM) Strategies.

It will also be used by the Department of Infrastructure,

Planning and Natural Resources (DIPNR) in reviewing agencies’ Asset and Capital Investment Strategies to support wider

state planning which better integrates land use, transport and

key infrastructure planning and development.

The template is accompanied by notes describing its form,

content and use. Agencies should consult their NSW Treasury

analyst where they require additional advice.

A glossary of the terms used in this template and guideline is

included at the end of the guideline.

Why a template?

The TAM Manual details how the Government’s policy for

the management of the State’s assets should be implemented. It requires agencies to prepare TAM Strategies, but it

does not prescribe the form or level of detail required in

such strategies.

TAM Strategies have become narratives of agencies’ operations and asset requirements, sometimes at the expense of

substance and detail. It is difficult to assess such strategies

and it is difficult for those developing them to use them to

effectively manage their asset bases, or know if they 
adequately fulfill their reporting obligations.

A template has now been prepared to:

 Provide agencies with a disciplined structure upon which to

develop their TAM Strategies consisting of their Asset

Strategy and integrated Capital Investment, Asset

Maintenance and Asset Disposal Strategic Plans.

 Set out the level of detail required in budget sector agencies’ presentation of their TAM Strategies to Treasury.

 Set out the level of detail required in agencies’ presentation

of their Asset Strategies and Capital Investment Strategies

to DIPNR. (See Premier’s Memorandum 2003-17).

 Set out the level of detail to be provided by self funding

agencies seeking Treasury agreement to undertake major

capital investments.

An agency’s TAM Strategies and their presentation to NSW

Treasury varies only in its level of detail.

In developing its TAM Strategies, an agency requires detailed

knowledge of government’s vision and priorities, its own corporate goals, service delivery strategy, resource levels and its

asset base.

The strategies must contain sufficient information to effectively communicate it to those within the organisation charged

with its implementation and with broader agency planning.

NSW Treasury and DIPNR require sufficient detail to understand the Strategies and gain confidence that government’s

service delivery priorities are addressed and the risks are

appropriately identified and managed. The template promotes

clear agency asset planning while discouraging time spent

documenting unnecessary material for NSW Treasury and

DIPNR.

A template clearly highlights any specific planning weaknesses which need to be addressed by an agency. It will be obvious to the agency from the quality and availability of the information sought at each step in the template, which areas of

planning require further development.

The template incorporates the approach set out in the Asset

Strategy Guideline which is part of the TAM Manual.

Agencies are encouraged to self assess their TAM

Strategies against the criteria set out in the Asset Strategy

Guideline, prior to submitting them to Treasury and DIPNR.

The TAM Manual is accessible on Treasury’s website,

www.treasury.nsw.gov.au.

By imposing a planning discipline the template is important in

raising knowledge and awareness within the agency, and

developing a common understanding within Treasury and

DIPNR, of agency service delivery and asset dependency. It

also makes it easier for NSW Treasury to assess agency compliance with TAM Policy and their need for resources. It also

encourages analysis of performance across the sector and by

agencies over time.

What are TAM Strategies?

TAM Strategies establish and document the assets that most

appropriately, effectively and efficiently allow an agency to

meet its service delivery commitments. The Asset Strategy is

the overarching strategy. It is developed in response to the

agency’s corporate plan, its Results and Services Plan or

Statement of Business Intent and its service delivery strategy,

acknowledging resource levels available over the life of the

strategy to deliver its services.

For agencies required to prepare Results and Services Plans

annually their TAM Strategies should reflect the service deliveries set out in these plans.

What use is made of the TAM Strategies?

The Asset Strategy is for use by the agency to establish the

optimum form of the assets required for them to deliver, within resource limits, the results and services sought by government. The resulting Capital Investment, Asset Maintenance

and Asset Disposal Strategies detail the actions the agency

proposes to undertake to manage its asset needs.

The TAM Strategies are required by NSW Treasury to ascertain the assets required for the agency to deliver government’s program of services and whether agencies are planning and managing assets in accordance with TAM policy.

Budget allocation decisions are influenced by the content of

the TAM Strategies. Treasury agreement is also required by

self funding agencies beyond the Budget process, prior to

them committing to major capital investments.

In addition, the Department of Infrastructure, Planning and

Natural Resources (DIPNR) draws on agencies’ Asset

Strategies and supporting Capital Investment Strategic Plans

to advise the Infrastructure and Planning Committee of

Cabinet (IPCC) on major infrastructure proposals, asset strategies and Capital Investment Strategic Plans. This committee

has the central role in setting the Government’s strategic

direction for urban and regional development and associated

infrastructure priorities through the NSW Infrastructure

Strategy. This is outlined in the State Infrastructure Strategic

Plan (SISP).

Agencies should consult with DIPNR to ensure appropriate

alignment of their Asset Strategies and Capital Investment

Strategic Plans with the SISP before these plans or specific

project proposals arising from them are submitted to NSW

Treasury for Budget approval considerations.

138 | APPENDIX E
Which agencies are required to prepare TAM Strategies?

The need to prepare Asset Strategies arises from TAM Policy,

which applies to all government departments, statutory

authorities, trusts and other government entities. State Owned

Corporations under the State Owned Corporations Act are

exempt although they are encouraged to adopt aspects of

TAM that are consistent with their corporate intent.

Budget sector agencies should prepare TAM Strategies

based on the agency continuing to provide agreed services

within its current resource limits. Depending on

Government’s priorities, fiscal position and other strategic

factors some budget sector agencies may be invited to submit specific proposals for enhanced levels of service.

Necessarily, such invitations will be limited. Non Budget sector agencies’ TAM Strategies should also be developed within the resource levels available.

Some agencies through self funding are able to internally

fund major projects. Procurement Policy requires these

agencies to submit any such projects to Treasury for full

assessment prior to approval of funding. An agency should

demonstrate a need for the project, normally through an

Asset Strategy and supporting Capital Investment Strategic

Plan.

When are TAM Strategies required?

TAM Strategies are required by Treasury and DIPNR by the

end of August to fit within the Budget cycle.

How should the template be used?

The template contains seven headings which the TAM

Strategies should address. The headings cover the agency’s

corporate and service goals, likely resource levels, alternative

service delivery strategies, risks to service delivery, performance measures and the asset strategies to achieve its service

delivery goals.

Each heading seeks specific information. Explanatory notes

detail the scope and depth of the information sought. Some

aspects of an agency’s TAM Strategies require detailed

knowledge of the agency’s corporate and service delivery

responsibilities as well as intimate knowledge of its assets.

The agency’s TAM Strategies should contain sufficient information to plan and manage its asset base.

The template approach does not require such detail to be

provided in the final presentation of the TAM Strategies document to Treasury and DIPNR. Samples of the agency data

used to develop this document should be appended to provide reviewers with confidence in its rigour. By setting clear

and reasonable expectations, unnecessary work can be avoided in preparing and assessing the strategies.

2. The Total Asset Management Strategies 

template

This template provides agencies with a structure to construct

their Asset Strategy and integrated Capital Investment, Asset

Maintenance and Asset Disposal Strategies.

THE ASSET STRATEGY

2.1 RESULTS, SERVICES AND CORPORATE GOALS

2.1.1. Identify the goals of the agency sector in which

the agency is located.

 NSW agencies are organised into cluster groups related to

their combined service delivery focus, e.g., Human Services

Cluster.

 This information should be available from the cluster CEO

committees which discuss sector issues.

2.1.2. Identify the agency’s corporate goals. Indicate

which are being pursued in conjunction with other

agencies and the responsibilities of each.

 All corporate goals should be included as each will have

asset implications, requiring current or new assets to implement them.

2.1.3. List the corporate performance indicators for

each corporate goal.

2.1.4. Clearly define and quantify each of the results

TRANSPORTATION ASSET MANAGEMENT | 139

Glossary

Results

What the agency is trying to achieve for society. Results are the intended

impacts that the services have on the community, the environment 

or the economy.

Services

The end products the agency delivers for external consumption.

Results and Services Plan (RSP)

A concise statement of the agency’s results, services, result 

indicators and service measures.

Total Asset Management Manual

The Total Asset Management Manual is an internet based document

explaining the NSW Government’s Total Asset Management Policy 

and provides details of the five component strategies forming the 

Total Asset Management Strategies. It also contains a series of guidelines

on implementing various aspects of asset planning. The Total Asset

Manual can be found at www.treasury.nsw.gov.au.
140 | APPENDIX E

the agency pursues based on there being no change in

the agency’s service delivery. Identify the corporate

goal(s) that each result supports. 

 This information should be available from an agency’s

Corporate Plan and Results and Services Plan (RSP) or

Statement of Business Intent (SBI). Where results support

several corporate goals, indicate whether that support is of

major or minor significance.

2.1.5. Clearly define and quantify each of the changed

results the agency plans to deliver based on delivering

an enhanced level of service. Identify the corporate

goal(s) that each result supports.

 Where results support several corporate goals, indicate

whether that support is of minor or major significance to

achieving that goal.

 Agencies should not commit undue expenditure on detailed

planning of such proposals for enhanced service delivery,

until invited to submit specific proposals.

 Early discussion about such proposals with NSW Treasury is

important to avoid wasted effort.

2.1.6. Clearly define and quantify each of the services

the agency delivers based on there being no change in

the services being delivered. Identify links to the

result(s) each supports.

 Include all significant aspects of the services being 

delivered.

 This may entail extensive detail which has usually already

been developed by agencies. Where such information

exists, refer to it at this item and append it in part or in full

to this template in its current form.

 While detailed data is important in preparing and 

implementing Asset Strategies, it is sufficient at this 

item for those reviewing the strategy to understand 

the quality of the information around which it was 

developed rather than to sight extensive data. Services

should be aligned with the agency’s corporate plan,

Results and Services Plan or Statement of Business

Intent.

 The Results and Services Plan requires current services to

be prioritised, identifying those considered least important

or which could be scaled back.

2.1.7. Outline present and future pressures driving

demand for services.

 This should include:

1. Demographic pressures, market factors, changed government policy, cross-sector objectives, future settlement development plans and the effect of changed

service delivery by other agencies.

2. New standards and changed operating environments.

3. Demands for higher levels of assets where the asset is

confused with the services delivered, e.g., police stations

rather than policing etc.

 Details of these pressures and when they are likely to occur

allows DIPNR to predict future trigger points for investment

and Treasury to better understand the basis for that future

investment.

2.1.8. Clearly define and quantify each of the changed

services the agency plans to deliver based on delivering enhanced levels of service. Identify links to the

result(s) each will support.

 Include sufficient details of the services to enable details of

the assets required, to be determined elsewhere in the

Asset Strategy.

 Agencies should not commit undue expenditure on detailed

planning of such proposals for enhanced service delivery,

until invited to submit specific proposals. Early discussion

about such proposals with Treasury is important to avoid

wasted effort.

2.1.9. List the performance indicators established for

each service.

 Performance indicators could relate to the service overall or

to significant aspects.

 There should be few enough indicators to be manageable

but sufficient to show the effectiveness of the service 

delivery.

2.1.10. Outline cross-agency and cross-cluster joint

service delivery and asset sharing options, either considered or proposed.

 Outline alternative means of achieving the results sought by

the agency.

 Outline service delivery options that have been explored

with other agencies. Outline the advantages and disadvantages of these options for each agency.

2.1.11. Outline alternative, less asset dependent service

delivery options, either considered or proposed.

 Outline any additional non asset resources such as staff,

that would be required for these options to be effective and

the overall advantage and disadvantage.

2.1.12. Outline options, considered or proposed, to

deliver different services or changed service levels

that achieve results more economically.

 Outline the advantages and disadvantages of these options

including the impacts on stakeholders including other

agencies.

2.1.13. Indicate the range in total resources predicted

to be available annually from the Budget, over the

next ten years.
TRANSPORTATION ASSET MANAGEMENT | 141

 Planning of results and services is of necessity iterative.

While driven by community need and government 

direction, it also considers the resources available, in 

setting service levels that can be sustained in the 

longer term.

 Future resources may vary for reasons beyond an agency’s

control.

 Canvass such risk, its extent and likelihood here. Outline the

measures to manage these potential risks here and detail

them at item 4.

 Discuss the range in future Budget allocations likely to be

available to the agency with NSW Treasury.

2.1.14. Indicate the resource range predicted to be

available from other sources over the next ten years.

 Include funding from all sources including Commonwealth

allocations.

 Outline the certainty of this funding and measures to 

manage these risks. Detail risk management strategies 

at item 4.

2.1.15. Estimate the percentage of these resources that

the agency will spend on provision, maintenance and

operation of its asset base.

 Agencies are required to support a range of resources to

ensure delivery of services.

 The amount of funding it expends on its asset base is a

function of the total funding available and the agency service delivery strategy which determines what and how services will be delivered, determining the required range of

resources.

2.1.16. Outline demand management strategies, either

considered or proposed, to keep service levels sustainable within resource limits.

 Outline the current expectations of stakeholders and the

means proposed to change this.

 Estimate the impacts of the demand management measures on stakeholders and on the results the agency is pursuing.

2.2 ASSET STRATEGIES DEVELOPED

2.2.1. Outline the asset performance criteria required

to deliver agreed services.

 Having established details of the services being delivered,

determine details of the way in which the assets must perform.

 This could include their capacity, location, fitness for their

service role, required service life and adaptability.

 The number of criteria selected should be the minimum

necessary for efficient and effective service delivery.

2.2.2. Outline how the required asset performance

was established.

 This information indicates the rigorous process which

determined asset performances and performance levels.

 Show how the asset performance decisions relate to both

service delivery levels and to the environment in which the

assets must operate.

 For example specified levels of asset reliability or security

may be vital in some assets for service delivery while in others aesthetics, privacy or air quality may be vital.

 Show how the required performance levels are used to

assess gaps between existing and required assets.

2.2.3. Outline the agency’s level of knowledge of its

asset base, the basis on which the asset base was segmented, and the analysis of the asset base involved in

developing the Asset Strategy.

 Provide evidence of the asset detail that is maintained by

the agency and the information systems used to manage

that data.

 Advise on what basis assets are segmented or grouped for

more effective management.

 Advise how the agency acquires and updates knowledge of

its asset base.

2.2.4. Detail each asset strategy and the service(s) it

supports.

 Include all high level strategies affecting the asset base.

 Strategies are usually developed separately for each major

asset type, group or segment.

 Several strategies may apply to the one group of assets.

 Examples of high level asset strategies include planning

appropriate maintenance to ensure asset service lives of 50

years, upgrading security to meet changing risks, accommodating new technologies within particular portfolios,

planning use of heritage assets to maximise their service

delivery while protecting their cultural values, designing

new assets to accommodate regular capacity upgrades or

reducing some standards at which low risk assets will be

operated.

 Asset Strategies are applied to ensure services can be

delivered now and over time.

 Link the services or groups of services to each asset 

strategy detailed.

2.2.5. Outline the gaps between the agency’s existing

and required asset base to continue service delivery

on a no-change basis. Outline the capital investment,

asset maintenance and asset disposal options.

 The gaps identified in the asset base should reflect changes

considered necessary to continue delivery of existing service levels.
 Assessments of non asset and less asset based options to

close the gap should be included as should proposed

changes to service delivery which could impact on asset

requirements.

 The iterative nature of all planning requires aspects of service delivery to be reconsidered when addressing gaps in

the resources needed to deliver them.

2.2.6. Outline the gaps between the agency’s existing

and required asset base to provide enhanced service

delivery. Outline the additional capital investment

asset maintenance and asset disposal options 

to close the gaps.

 Some agencies may be invited to submit specific proposals

for the delivery of higher levels of service, based on

Government priorities and factors, including the quality of

their asset and overall planning.

 In developing the asset strategy, agencies should not commit extensive effort to planning for enhanced service delivery unless they are invited to submit specific proposals.

Rather, they should prepare preliminary assessments of

options to enhance service delivery.

 Assessments of non asset and less asset based options to

close the gap should be included as should changes to

service delivery which could impact on asset requirements.

2.3 Asset performance measures and targets defined

2.3.1. List all asset effectiveness measures kept by the

agency.

 Asset effectiveness measures determine the value of the

asset in delivering the agency’s services. Effectiveness

measures allow comparisons between assets and between

agencies.

 The measures can be of a discrete asset or of components

or aspects of an asset if these are significant to the service

delivery.

 Link each of them to the services the asset is used to 

provide.

 Effectiveness measures link service measures to measures

of the assets supporting their delivery.

2.3.2. Compare the effectiveness results obtained over

consecutive years. Indicate the conclusions drawn 

and outline actions to improve effectiveness.

 Compare the effectiveness of the asset base over time and

the effectiveness of particular assets or asset classes.

 Improvements may focus on the managing the asset,

changes to its operation or changes to other resource

strategies or to the services and their delivery.

2.3.3. Document effectiveness targets or benchmarks.

 Effectiveness targets could reflect appropriate targets from

other jurisdictions or from similar industries.

 Include timeframes for achieving each target.

2.3.4. List all asset efficiency measures kept by the

agency.

 Asset efficiency is the measure of how economic of means

the asset is in supporting the delivery of services.

 It could include measures of the asset’s operation, how fully

it is used or the amount of energy, staffing or other support

it requires to deliver service.

2.3.5. Compare the efficiency results obtained over

consecutive years. Indicate the conclusions drawn 

and outline actions to improve asset efficiency.

 Compare the efficiency of assets over time and of particular

assets or asset classes.

 Results should take into account differences between

assets that may account for the different measures, e.g., 24

hour operation or greater staff numbers could account for

higher energy usage.

2.3.6. Document efficiency targets or benchmarks.

2.3.7. List all asset management efficiency and 

effectiveness measures and outline actions to 

improve asset management effort.

 Asset management functional performance measures

gauge how well all the aspects of asset management were

undertaken.

2.4 Risk management strategies developed and 

documented

2.4.1. Document the risk management strategies 

developed for each service delivered.

 Risks to service delivery can come from either the assets

supporting its delivery or from failures beyond assets.

 Focus at this item on asset related risks to service delivery.

 Failures can risk current delivery or future delivery.

2.4.2. Outline the planning procedures in place for

conducting both formal and informal Risk

Management, Economic and Financial Appraisal, 

and Value Management exercises.

 Provide evidence of when and how these assessment and

decision making tools are used in the agency’s asset planning process.

2.4.3. Summarise the application of Risk Management,

Economic and Financial Appraisal and Value

Management studies to each asset strategy.

 Risk management, Economic and Financial Appraisal and

Value Management should be appropriately considered for

142 | APPENDIX E
each asset strategy proposed.

 Include brief summaries of them here. These studies 

should be extended to project or program specific studies,

depending on their size and risk, as their planning 

progresses.

 They are essential for all proposed major capital works 

submitted for Budget funding approval and should be

included at item 5.

The Integrated Capital Investment, Asset

Maintenance and Asset Disposal Strategies

2.5 CAPITAL INVESTMENT STRATEGY DEVELOPED

2.5.1. Detail the gaps in the current asset base

required to deliver the services agreed in the Results

and Services Plan, based on there being no change in

the services being delivered.

 Gaps may be due to changes in the assets’ operating environment including changed stakeholder expectations,

changed legislation or deterioration of assets over time.

 The level of service delivered however should remain

unchanged.

2.5.2. Detail the gaps in the current asset base

required to deliver enhanced services.

 Gaps described here will be due to plans to deliver

enhanced levels of services.

 As distinct from general planning of alternative asset 

solutions, agencies should not engage in extensive 

planning of specific projects unless they are 

invited to submit specific proposals.

2.5.3. Detail the project objectives required for the

assets to effectively deliver services.

 The project objectives translate the service delivery strategy

and the asset operating environment into requirements that

the project must meet.

 Provide the project objectives for each project or each

group of similar projects.

2.5.4. Document the Capital Investment Projects

Proposed. Provide project specific information including estimated total project or program cost, project

status (major or minor, new work or work in

progress), project type (e.g., land acquisition, procurement of assets), commencement and completion

dates and projected cash flows. Show links to Asset

Maintenance and Asset Disposal Strategies and

Information Communication Technology Strategic

Plan where applicable.

 Provide detail on each of the works proposed, similar smaller scale projects, on a program basis.

 Details linking the proposals to the services they support

and information supporting funding should already be

included elsewhere in this document.

2.6 ASSET MAINTENANCE STRATEGY DEVELOPED

2.6.1. Outline the maintenance resources, internal or

external to the agency.

 All resources, including human resources, available to the

agency affect the maintenance delivery options that can be

considered.

 Other resources affecting maintenance delivery include

knowledge of the asset base, administrative, technical and

procurement skill levels, management and construction

technology and financial resources.

2.6.2. Outline the long term maintenance strategies for

each asset type or risk category. (Include operational,

strategic and cultural influences affecting the way

maintenance is organised and delivered.)

 Include strategies to address urgent, major, programmed,

geographically isolated and high risk maintenance. Outline

any links between individual strategies.

 Outline any inter agency strategies. Highlight any 

constraints on maintenance planning and delivery 

stemming from service delivery pressures, or organisational pressures.

 Examples might include security difficulties in providing

maintenance access or retention of certain maintenance

capacities on staff to address emergency breakdowns.

2.6.3. Outline the results of assessing asset condition

against performance criteria, for assets to continue to

deliver service based on no change in the services

being delivered.

 This gap between the current assessed standard of the

asset base and the standards required should consider the

resources available over the life of the asset strategy.

 A gap larger than the financial resources available to

address it indicates the agency must review its asset and

other resource standards or the levels of service it plans to

deliver.

 The gap should not include increased requirements to support the delivery of enhanced services.

2.6.4. Outline the results of assessing asset condition

against performance criteria, for assets to deliver

enhanced service.

 Gaps described here will be due to plans to deliver

enhanced levels of services.

 As distinct from general planning of alternative asset maintenance solutions, agencies should not engage in extensive

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planning of such programs unless they are invited to submit specific proposals.

2.6.5. Document the Asset Maintenance Works

Proposed. Provide a prioritised, costed program of

proposed works for the forthcoming year and longer

term budget projections.

 Details linking the proposals to the services they support

and information supporting funding should already be

included elsewhere in this document.

2.7 ASSET DISPOSAL STRATEGY

2.7.1. Identify assets assessed as surplus to service

delivery requirements for disposal.

 Include all assets no longer supporting service delivery or

which are likely in the future not to support service delivery,

due either to deterioration of the asset or changed service

requirements.

 Detailed property disposal plans are required for all real

property assets in accordance with details provided in the

TAM Manual and Asset Disposal Strategic Planning 

guideline. 

 Treasury assesses these plans and provides advice on 

overall disposal strategies to the Government Asset

Management Committee.

 Consider all disposals over the full timeframe of the asset

strategy.

2.7.2. Identify opportunities to maximise disposal 

values.

 Include both agency and interagency opportunities.

2.7.3. Document the Asset Disposal Strategy. Provide a

costed program of disposals for the forthcoming year

and over the longer term. Show links to the Asset

Maintenance Strategy.

 The program should include any expenditure required to

plan and achieve the disposals.

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