The 2015 Auditor-General’s Report raises the concern that there are no guidelines for the desired condition at which facilities should be maintained. There is also no consistent standard for how Ministries ought to measure the condition of assets such as highways, bridges, schools and hospitals.
A bit shocking that the provincial government has gone so far as to log all the disrepair in schools but has not concerned themselves with setting an actual goal to measure success.
Here is an excerpt from page 11-12, Chapter 3 of the 2015 Auditor-General’s Report: which provides examples of how various Ontario Ministries approach determining asset condition and also provides the example of how Alberta approaches this issue in a more transparent, solution-oriented manner:
Assumptions Vary in Calculating Asset Condition
Ministries generally use the Facility Condition Index (FCI), an industry-standard measure of a building’s condition at a given time, to determine if their assets are in good, fair or poor condition. The FCI is calculated by combining the total cost of any needed or outstanding repairs with the renewal or upgrade requirements of the building, divided by the current replacement value. In essence, it is the ratio of “repair needs” to “replacement value,” expressed as a percentage. The higher the FCI, the greater the renewal need.
However, ministries make different assumptions in estimating their repair needs. In its 2015/16 submission to the Secretariat, for example, the Ministry of Education identified an FCI of about 36% for its schools overall by including its current repair backlog and five years of future repair needs in its calculation. In contrast, the Ministry of Health and Long-Term Care included its current repair backlog and only two years of repair needs in its calculation, and arrived at an average FCI of 23% for its facilities. Because these two ministries assessed the conditions of their respective assets differently, it is difficult to determine which of them has a higher priority need overall.
For highways and bridges, the Ministry of Transportation takes a different approach in assessing their condition. It classifies its highway pavements and bridges as being in good, fair, and poor condition. Pavements and bridges are considered in good condition if they will not require any rehabilitation work for six or more years. Based on this assessment, the Ministry has classified 77% of the pavements and 83% of bridges that they are responsible for to be in good condition.
In comparison, Alberta uses a government-wide standardized FCI as a common measure to enable ministries to compare condition ratings across facility types (schools, post-secondary institutions, government-owned buildings and health-care facilities). It calculates its FCI using current backlogs and five years of future repair needs.
Alberta has targets for the percentage of facilities to be in good, fair and poor condition for the different sectors, and it reports the actual percentage in each category publicly each year, along with the progress made towards achieving each sector’s targets. It uses the following definitions:
• Good—the facility’s FCI is less than 15%, is adequate for intended use and expected to provide continued service life with average maintenance.
• Fair—facilities with an FCI between 15% and 40%, inclusive, have aging components nearing the end of their lifecycle and require additional expenditures for renewal or refurbishing.
• Poor—facilities with an FCI greater than 40% require upgrading to comply with minimum codes or standards, and deterioration has reached the point where major repairs or replacement are necessary.