(1) Water systems are encouraged to develop
and implement an asset management program. An asset management program provides
the following benefits to water systems:
(a)
Prolong asset life.
(b) Reducing
overall costs for operations, maintenance, and capital expenditures.
(c) Improving decisions about asset
maintenance, rehabilitation, repair, and replacement.
(d) Meeting customer demands with a focus on
system sustainability.
(e) Meeting
service expectations and regulatory requirements.
(f) Improving responses to
emergencies.
(g) Improving asset
safety and security.
(h) Budgeting
focused on critical activities for sustained performance.
(i) Setting rates based on sound operational
and financial planning.
(2) An effective asset management program
includes detailed asset inventories, operation and maintenance tasks and
long-range financial planning. These items should be captured in an asset
management plan, which can be tailored to fit individual water system size and
complexity.
(3) The asset
management plan shall address the following five core components:
(a) The current state of the utility's
assets.
(i) Prepare an asset
inventory.
(ii) Develop a system
map.
(iii) Develop a method to
assess and prioritize assets based on condition.
(iv) Assess the asset's remaining useful
life. (v) Determine asset value and replacement cost.
(b) The utility's required sustainable level
of service.
(i) Analyze current customer
demand and satisfaction.
(ii)
Analyze anticipated customer demand and satisfaction.
(iii) Understand current regulatory
requirements.
(iv) Communicate
system performance goals with the public.
(v) Identify standard levels of services and
track system performance.
(c) Assets that are critical to sustained
performance.
(i) Conduct a failure analysis
on all assets.
(ii) Determine
probability of failure.
(iii)
Analyze risk and consequences of failure.
(iv) Prioritize system assets based on
importance to system operation.
(v)
Develop specific response plans based on potential asset
failure.
(d) Minimum
infrastructure life-cycle costs.
(i) Implement
an appropriate maintenance schedule, including costs for all assets.
(ii) Identify life-cycle costs for all
assets.
(iii) Develop a capital
improvement plan and an operations and maintenance strategy.
(iv) Identify and compare the cost of
rehabilitation versus replacement.
(v) Determine the related costs of responding
to asset failure.
(e)
Long-term budgeting strategy.
(i) Regularly
review system budget.
(ii)
Establish and fund a capital facilities account.
(iii) Implement a rate structure to ensure
financial sustainability.
(iv)
Explore asset renewal and replacement financing.
(v) Identify financial assistance resources
based on asset condition and importance.
(4) All water systems subject to this rule
shall complete the following:
(a) Prepare and
asset management plan as described in Subsection
R309-800-5(3).
(b) System's governing body shall formally
adopt the asset management plan.
(c) Submit proof of adoption to the
Division.
(5) In addition
to the requirements in Subsection
R309-800-5(4),
water systems applying for financial assistance from either the federal or
state Drinking Water State Revolving Fund Financial Assistance Program must
also submit their asset management plan to the Division for review or request
sufficient funds to create an asset management plan. Asset management plans
prepared using financial assistance from the Drinking Water Board shall be
submitted to the Division for review.
