Developing a Comprehensive Infrastructure Management System

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Developing a Comprehensive Infrastructure Management System By Andrew C. Lemer1 and Jeff R. Wright2

Introduction “Infrastructure”, the subject of more than a decade of debate in Washington and other world capitals, has risen from technological obscurity to page-one popularity. Yet the topic remains, for most people, simply a diverse assemblage of roads, sewers, pipes, power plants, and other major facilities. A growing body of studies is helping professionals and policy-makers to understand that infrastructure exists as an interconnected system, and that this system's efficient functioning is crucial to our environmental quality, economic well-being, and quality of life in general. Nowhere is the importance of infrastructure more apparent than in the nation's urban areas. Provision of clean water, effective waste removal, reliable energy supplies, transportation and communication has offered city-based industry and residents substantial advantages that have supported growth and prosperity for a steadily growing proportion of the U.S. population. The system providing these services has evolved through major investment, introductions of new technology, and shifts in institutional structure that often occurred piecemeal, each change responsive to a narrowly perceived need or opportunity. Today we face problems of aging facilities, networks that no longer fit well the patterns of shifting demands, and conflict among government and privatesector agencies working independently and sometimes at cross-purposes to manage parts of the system. In addition, we are coming to recognize that infrastructure encompasses a very broad range of functions, that extends well beyond the traditional scope of “public works.” Schools, health care facilities, parks, telecommunications hardware, and public monuments are but a few of the elements coming to be routinely included when attention turns to infrastructure. Even further, we are coming to realize that infrastructure is more than simply a collection of diverse facilities. Rather, infrastructure comprises an interconnected functional system in which trade-offs among seemingly disparate parts can influence dramatically the performance of the whole: e.g., improved transportation 1. 2.

Visiting Professor, School of Civil Engineering, Purdue University, and President; The Matrix Group, Baltimore, Md. (410) 235-3307 ([email protected]) Professor of Civil Engineering, Purdue University and Director of the Indiana Water Resources Research Center. Dr. Wright is also Editor-in-Chief of the ASCE Journal of Infrastructure Systems. (765) 494-2175 ([email protected])

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can spur the demand for more water; how solid waste is managed can influence the patterns of energy use. The Infrastructure Innovation (I2) Partnership is undertaking an integrated program of research, education, and technology transfer, designed to produce and disseminate new knowledge that enables enhanced infrastructure performance, and encourage the application of this new knowledge so that infrastructure performance is improved. At the core of the program is the concept of a new management tool for infrastructure system administrators. First conceived by officials of the City of Indianapolis3, the concept is being developed into a management and decision-support system that will provide responsible managers with meaningful information on the status and performance of their system and means for exploring how future demands and management policies may influence performance. The I2 Partnership now refers to this concept as the Integrated Infrastructure Management System (IIMS). We envision the IIMS as a computer-based management tool that will apply advanced information collection and management technologies to provide more efficient, accurate, and effective bases for making decisions about infrastructure. The IIMS will combine inventory, condition assessment, predictive modeling, scenario development, and user-friendly information-access capabilities. These capabilities will be tailored to support decision-makers in municipal and regional governments, private business, and community leadership, who seek to assure the effective performance of their urban and regional infrastructure. A program of research and technology application will support development of the information, predictive models, and management strategies needed to make the IIMS an increasingly accurate and effective aid for infrastructure management. A central feature of the IIMS is an Infrastructure Balance Sheet (IBS), a management report aimed at giving decision-makers a realistic assessment of the value of infrastructure. Analogous to a corporate balance sheet, the IBS will represent infrastructure as both assets and liabilities that a region (e.g., a municipality or an urban region) develops and uses to support the economic and social well-being of the people who live there. Like the corporate balance sheet, the IBS may be presented in succinct form but embodies a wealth of more detailed information (e.g., in the footnotes of the corporate report and other supporting documentation and analyses) for those who have a use for such detail. The IIMS development program is a long-term effort. This paper focuses, however, on activities to be undertaken over the next three to five years. During the 1995-1997 academic years, Purdue University received a small grant from the National Science Foundation that is supporting the I2 Partnership’s initial work. This paper describes the basic elements of the IIMS concept and the IBS, the research and development activities likely to be needed to realize the greatest potential value of the concept, and the I2 Partnership’s planned work to implement the concept.

3.

Burkhardt and Gallant (1994) present an early description based on discussions held among staff professionals of the department of Capital Assets Management and other city officials.

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The IIMS and the I2 Partnership’s Objectives The primary users of the IIMS and the IBS as well as IIMS-based information components will be infrastructure managers, broadly defined to include the public whose assets are being managed as well as the professionals and officials who implement particular decisions. These various people are responsible for making often complex technical and financial judgements that collectively determine the performance of a region’s infrastructure. These managers face several key obstacles to achieving the greatest possible return on the public’s assets: •

Managers must deal with multiple and often conflicting objectives. Providing road transportation infrastructure to enhance mobility, for example, has in many cities led to deterioration of air quality, loss of wildlife habitat, and disruption of vibrant neighborhoods. Maintenance of water and sewer networks damages road pavement and disrupts traffic. Meeting the demands for service in one area of a metropolitan region or sector of the economy may shift traffic or consume budgets, thereby diminishing the performance that other areas or sectors experience.

•

Managers must accommodate the interests of diverse stakeholders. Owners, users, and neighbors of the various components of the infrastructure system have varied views on what comprises good performance. Residents of an area want stormwater removed quickly, with no flooding of property or disruptions to street traffic. Groups concerned about environmental protection may prefer that the volume of runoff entering streams and lakes be restricted to avoid soil erosion and protect wildlife habitats. The agency responsible for stormwater management wants to meet these demands while controlling costs, within the constraints of capital and operating budgets. If the agency operates as a utility, it may be expected to provide fair financial returns to investors as well. Regulatory agencies wishing to protect public safety and environmental quality may want to restrict agencies’ or consumers’ actions. All have a stake in judging infrastructure performance.

•

Managers making decisions about the future must deal with substantial uncertainties. Physical, chemical, and biological processes that underlie infrastructure performance are in many cases poorly understood and at best only partially observable. While Portland cement concrete has long been widely used in all infrastructure, for example, research is still yielding new understanding of the chemical and physical behavior of this material. Even when the underlying processes of deterioration are understood, people and equipment that monitor facility condition typically must rely on visible surface characteristics to infer the strength and durability of massive structures. In addition, efficient operations often depend on forecasts of future demands for infrastructure’s services that are influenced by economic, social, meteorological and other complex factors.

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Managers must work within the constraints of data availability and institutional structures. While new data might improve our understanding of system behavior, simply collecting data is often costly and limited by shortages of staff and equipment. In addition, division of responsibilities among agencies often limits our ability to take advantage of opportunities to improve performance. Over the shorter term, existing data and institutional relationships represent a fixed framework within which management decisions must be made. We recognize, for example, that controlling water consumption may reduce sewage loads. Incentives are often lacking, however, for the water-supply utility to limit water sales, when the benefits of reduced waste treatment costs accrue entirely to a separate government agency.

Despite these obstacles, improved infrastructure performance is possible. Over the longer term, research and subsequent innovation can change the ways the infrastructure system operates as well as our understanding of the underlying processes. These improvements can be realized in several ways, for example by: •

Enhancing the efficiency and reliability of infrastructure services delivery to users;

•

Improving the scope, efficiency, and reliability of infrastructure technology;

•

Increasing our knowledge of infrastructure system behavior and using that knowledge to improve design and management;

•

Improving the effectiveness of the personnel who design, construct, operate, and maintain the system;

•

Increasing overall returns on the public assets that infrastructure represents.

Users of the IIMS Seeking such improvements by overcoming obstacles to effective management is the I2 Partnership’s goal. The IIMS will be the means for achieving that goal. Generally speaking, infrastructure management is the responsibility of decision-makers working at many levels, from the patching of potholes to the drafting of legislation. Each of these decision-makers needs information about the system and its likely response to management actions. We envision that these decision-makers, as users of IIMS information, can be grouped into four principal categories shown in Table 1. The business and community leadership in a region (e.g., Indianapolis) represents the primary focus of the I2 Partnership’s efforts to produce a useful management tool. Within this context, the IBS will be designed to support informed decision-making about development, operations, and retirement or redeployment of infrastructure assets. The chief executives, mayor and council, and other senior management of major institutions in the region represent an important subset of this primary focus group.

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The IIMS can provide information useful to other levels of decision-makers as well, as listed in Table 1. On the one hand, there are the public works and other professionals who must make decisions and take actions that directly influence the day-to-day condition of the infrastructure system. On the other hand, there are the organizations, groups and individuals within the public-at-large who pay the costs, seek the benefits and bear the adverse impacts of infrastructure decisions. While the initial focus of the I2 Partnership’s efforts will be on the needs of municipal government decision makers, we envision the IIMS will evolve to become an integrated database and analysis tool that will facilitate informed decision-making by all stakeholders in the region’s infrastructure. The IIMS and IBS will be program-level tools, intended to support broad budget and policy decisions typically made at the levels of municipalities, metropolitan areas, or state-wide. While individual bridges, culverts, and other facilities ultimately comprise the infrastructure system in a region, decisions about how these facilities should be designed, constructed, and operated require much more detailed information than the IIMS will use. We envision that the IIMS database and analysis procedures will draw on and be compatible with the more finely detailed project-level information that are used, for example, by city design engineers. Table 1 The Several Users of IIMS and “Balance Sheet” (IBS) Information Prototypical balance-sheet users Mayor, City Council, high- level corporate officials

☞

Business and community leadership

Citizenry-at-large

Government officials, department head to project managers

Nature of users’ interest, decisions to be made Queries to staff in connection with major budget decisions, political judgements, and regionpromotion activities Interpretation of consequences for community as a whole and for specific sub-areas, industries, and groups Neighborhood- and projectspecific impacts and individualized consequences (e.g., tax levels) of programmatic decisions Planning, programming, and budgeting system requests, using technical models and analyses, capable of being related to project-level information

Preferred form, level of detail, reporting mode for IIMS A*

Very brief, straightforward key-point summary, e.g., report card

A

Brief, articulated executive summary, e.g., corporate annual report financial statement Query-based analysis and reporting, on-demand and recurring, to estimate or translate program consequences Query-based analysis and reporting, on-demand and recurring, with supporting data available

B

C

☞ Primary basis for establishing initial balance sheet estimates; IIMS (=integrated infrastructure management system)

Underlying IIMS Concepts and Research Questions Infrastructure is a public asset intended to provide support and service to a wide range of social and economic activities. We provide infrastructure not for its own sake, but rather 17

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for the benefits accruing to these various other activities. Determination that infrastructure is performing well must reflect how effectively the system is serving these other activities. The measures of infrastructure performance should then be indicative of economic, environmental, and social outcomes of providing infrastructure’s services. Infrastructure Assets and Their Value Integrated infrastructure management should seek to achieve high returns on the public assets that infrastructure represents. Judging whether returns are adequate or could or should be greater requires a clear understanding of the value of the assets to be managed. Judging the asset value of infrastructure is, however, an exceedingly complex task with multiple dimensions. There are social, environmental, aesthetic, and political aspects of infrastructure’s asset value, as well as the more conventionally understood economic and financial aspects. Exploring and learning to deal effectively with these broader aspects of the public’s infrastructure assets will be an important part of the I2 Partnership’s research studies. Even if one restricts discussion primarily to financial and economic aspects of infrastructure asset value, there are complexities. As Table 2 illustrates, there are four principal approaches or bases for establishing the financial and economic value of infrastructure assets. Many government agencies have data only on historic expenditures, and often have only partial records for their infrastructure system. Given the long service life of many elements of the infrastructure system – often 50 to 100 years and more – these historical expenditures have only limited uses as a basis for considering infrastructure's value. Placed in appropriate context, e.g., in comparison to trends in population, developed land areas, or economic activities within a region, even very old historical records can nevertheless be useful to today's decision-makers. The primary focus for establishing IBS values, however, will be estimated current costs for replacing facilities and providing the operations they support. These estimates must typically be derived from engineering cost models or economic approximations based on recent data, effectively a perpetual rotation of the facilities inventory on what management accountants would term a “last-in-first-out” basis. Again in view of the long service life of infrastructure, most infrastructure managers recognize that the costs of construction represent only a fraction of the overall costs of infrastructure. The “life-cycle cost” of infrastructure is then calculated to represent the likely influence of operations, maintenance, and service usage throughout the extended service life of a facility. If maintenance is neglected or usage imposes greater stress or wear on the facility than was anticipated, life cycle costs may increase. The accumulated influence of wear, environment, maintenance practices, and other such factors is reflected – to the degree these influences can be estimated – in the “equivalent present value” estimate shown in Table 2. This value estimate is a secondary focus of the IBS information, an important basis for making judgements about maintenance and repair policies.

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Table 2 Bases for Establishing Financial and Economic Value of Infrastructure Assets Approach to Valuation (common-sense definition)

Advantages, problems, and recommendations

Historic expenditures, at cost • Uses generally-available Historical records of data procurement and related costs • Does not account for accumulated from first changes in prices, except as undertaking to the present; base reflected in expenditures for acquisition accounting cost, upgrading and maintenance what was paid in the first place • Neglects usage and wear, except as reflected in expenditures for upgrading and maintenance • Neglects changes in technology and service expectations or standards ☛2 Current replacement cost; • Reflects current prices and estimated reproduction cost technology Engineering cost estimate of • Easily understandable bid prices for building the • Conjectural; cost not system or facility at current determined until actual market conditions or equivalent procurement is complete macroeconomic bases (e.g., perpetual inventory valuation); what it might cost to replace ☞3 Equivalent present value in • Uses generally-available place Historic costs adjusted data for inflation, depreciation, • Accounts for changes in depletion, and wear; prices and usage comparable current • Neglects changes in expenditure, what it is worth technology and service “as is” (cf., used car purchase) expectations or standards • Requires conjectural assumptions 1

4

Productivity-realized value in • Realistic reflection of use Net present value of benefit importance to the stream for remaining service community life; what one might be willing • Many assumptions and nonto pay not to lose it market estimates needed

Use, application • Direct comparison with contemporaneous data in time-series progressions; e.g., investment per unit land area or per capita, across regions • Basis for valuation approach 3

• Comparisons with other current assets, e.g., buildings, private-sector projects • Basis for capital budgeting

• Comparison with other investments, e.g., for estimating rates of return, benefit/cost analysis • For budgeting analyses (in comparison with value estimates 2 and 4), especially regarding maintenance policies and practices, in context of lifecycle cost analyses • Describing relative importance of infrastructure to community well-being • Budgeting decisions (with value estimates 2 and 3)

☛ Primary basis, ☞ secondary basis for establishing initial infrastructure balance sheet (IBS) estimates.

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The real value of infrastructure however lies in the services it provides, its enabling role in supporting other economic and social activities. Good decisions about how much to spend on infrastructure (and how to spend it) as compared with the many other demands for public and private spending, have to be made by considering the full benefits and adverse effects of infrastructure. Table 3 gives a simplified example of how the IBS might show the value of infrastructure assets in Indianapolis. As the specific projects included in Table 3 illustrate, alternative approaches to valuing infrastructure can yield very different results. How these various results can be made most useful to decisionmakers is one of the several questions facing the I2 Partnership researchers. The historical value of infrastructure may be useful for comparison of levels of annual and total investment in roads and bridges, for instance, as compared to sewers and drainage, or relative to total population served. Such a comparison would be a useful element of an analysis of urban development patterns and environmental management policies. Replacement values might be used to consider the value of maintenance and repair spending, to estimate the potential losses that might be incurred if infrastructure is allowed (i.e., through lack of adequate maintenance effort) to deteriorate more rapidly than was anticipated at the time of design and construction. Maintaining the present value of infrastructure may be a meaningful management objective, in the sense that the consequences are understandable to the general public and there is a measurable criterion for judging success. Setting such an objective, as a matter of public policy, would be analogous to setting a private objective of preserving the purchasing power or investment returns of one’s capital, e.g., in a retirement fund, in the face of inflation and potential functional obsolescence. Another management objective might be to maximize “value-in-use,” i.e., to achieve the greatest possible difference between the benefits of infrastructure and the costs of providing that infrastructure. Most infrastructure planning and design decisions are made, in principle, with such an objective in mind. Infrastructure Deterioration and Obsolescence Normal usage and aging of facilities and materials produces a gradual deterioration that accumulates to impair the capability of the infrastructure to provide its services. This loss of performance is, in principle, foreseeable and can be influenced by the selection of materials characteristics, facility design details, and other management decisions. Nevertheless, research on materials, structures, and management strategies have led to substantial progress in developing effective tools for estimating deterioration as a function of design and construction parameters, usage, and environmental factors. Pavement- and bridge-management systems developed over the past several decades, for example, have been gaining acceptance as management tools because the deterioration models that underlie their predictions of life-cycle costs are being made more accurate by research and development activities. Making further improvements and extending the concept to other elements of infrastructure (e.g., sewers, drainage structures) will be an important I2 Partnership research area.

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Table 3 Examples of the Assets Side of the IBS for Indianapolis Values of infrastructure (refer to Table 1)

Infrastructure Elements (illustrative--not a complete listing) Generic groups--may match to city organization structure

1

2

3

4

Historical

Replacement

Present value

Value in use

what was paid

what it might cost

what it is worth “as is”

what it is worth not to lose it

• City-owned & managed Roads & bridges Rail lines & bridges Sewers & culverts, treatment facilities Water supply Parks • City-administered or other Airport Schools (School Corp.) Sports (RCA Dome), arts facilities (Capital Improvements Board) • Not city property, etc. Examples from Indianapolis (Numbers in italics are strictly conjectural and included for illustrative purposes only. Other values from city records or estimates.) Brookville Road bridge over Pleasant Run (2-lane local road)

Built in 1929 for $16,570 Replaced in 1986 for $375,290

Michigan Street bridge over Little Creek

Built 1941 for $35,540

Indiana Avenue bridge over Indianapolis Water Company Canal

First crossing built in 1910 for $9,940 1986 replacement, substantially enlarged, $1.25 million

Estimate based on standard models might be $565,000

Estimate $540,000, based on average 4% price inflation and normal maintenance and wear

Estimate $60M, based on 40-yr life, time savings of $2M/ yr., 4% discount rate

City budget estimate for 1998 replacement is $800,000 Part of central-area system; value would include time losses and business disruptions

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Investments made and costs incurred in the past

Present Condition

Accrued consequences of use, maintenance, environment

Benefits to be accrued in the future, for which one may be willing to pay

Usage and costs to be incurred in the future

Assets Observations

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Liabilities BALANCE SHEET

Projections

Figure 1. Infrastructure as assets and liabilities Obsolescence is likely to receive particular attention. An obsolete item– antiquated, oldfashioned, or out-of-date – is not necessarily broken, worn out, or otherwise dysfunctional, although these conditions may underscore its obsolescence. Rather, the item simply does not measure up to current needs or expectations. Obsolescence results when there is a change in the requirements or expectations. The danger of earthquakes in California, for instance, has motivated changes in structural design standards to reduce the risks of failure and mitigate the consequences of such a disaster. Similarly, introduction of heavier vehicles in interstate commerce has increased the loads that highway pavements and bridges are expected to carry. These changes, in turn, have rendered many older structures effectively obsolete since they no longer comply with the most recent safety or load-carrying requirements. In general, economic or social changes can substantially alter the demands placed on infrastructure, while technological or regulatory changes change our views of what is an acceptable standard for infrastructure's services. In most cases infrastructure that is obsolete continues to function but at levels below contemporary standards. This substandard service represents a loss of the “value-in-use” of infrastructure. Infrastructure as Liabilities The “balance sheet” traditionally used in the corporate world represents a snapshot of the financial status of an organization at a particular moment. In this snapshot, the assets or resources of the organization represent only half the story. The other half is the claims that outsiders may hold against the organization, the liabilities (See Figure 1). For infrastructure, these liabilities include at least the future maintenance and operating expenses that must be incurred if the infrastructure is to provide the services expected of it and to perform as expected.

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Liabilities may also include adverse social and environmental consequences that must be suffered for the sake of the benefits to be received. The public recognizes, for example, that accidents and air pollution are inseparable from the mobility and convenience of the highway-based urban transportation system, although they may accept speed limits and costly automotive technology that encourage safety and improve environmental quality. Developing a good understanding of the liabilities as well as assets that infrastructure represents is another broad topic for research planned under the I2 Partnership’s program. The Budgetary Context The “program-level” uses of the IIMS and the IBS will be primarily in the budgeting process. Any unit of government has certain sources of revenues and many demands for where money should be spent. Almost inevitably, these spending demands in aggregate will exceed the available revenues. Increasing revenues means increasing taxes and fees for services, seldom a politically popular move, or borrowing against future revenues to enable capital investment or balancing an out-of-balance budget. Figure 2 illustrates the situation for infrastructure. Some revenue sources, such as gasoline taxes, are “earmarked” for spending only in certain areas, i.e. highway or other transportation improvements. Other revenues are not so restricted, and so could be spent for any number of purposes. It is these latter funds that are typically the focus of discussions where the IIMS will be most useful.

Funds Disbursed

Funds Available Contingency funds

Funding Shortfall

System & capabilities expansions

Bonded funds

Capital enhancement, renewal & replacement

Total revenues Capital preservation

.

Normal O&M Obligatory operations & Earmarked revenues maintenance (O&M)

Figure 2. Revenues and spending for infrastructure

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$

Water supply

Earmarked spending without budget constraints (not to scale) Roads & bridges Waste water Desired spending without budget constraints

Other program elements

Final budget allocations Figure 3. The problem of allocating infrastructure spending Spending similarly falls into categories. On the one hand are funds that must be spent to maintain facilities at a minimum level such that there are no structural failures, extreme safety hazards, or other catastrophic results. Of course, even spending at this level can be neglected or ineffective, with results illustrated by the forced closing of rusting highway bridges or emergency repair of dams found to be close to failure. Generally speaking, neglect of what engineers term “required” maintenance adds to life-cycle costs and liabilities. On the other hand there are activities that can reasonably be deferred or subjected to further scrutiny in the decision-making process. The growth of congestion on highways is a very visible result of decisions to permit declines in levels of service prior to expansions of system capacity. The need for contingency funds, in particular, often seems dubious to people unfamiliar with the uncertainties of infrastructure systems behavior. Allocating funds to this category contributes to infrastructure performance by controlling the level of risk that the system will be less effective in meeting the demands placed on it. (The problems of defining and measuring infrastructure performance are discussed later in this section of the paper.) The core infrastructure budgeting problem then is how to set the overall levels of spending and then allocate discretionary funds among the several areas where they might be spent, under the general condition that one is likely to want to spend more than is immediately available. Figure 3 graphically illustrates the problem. The IIMS, as a management tool, should provide information to assist in making such budget allocations. The allocations should be made to yield the greatest return on the public's infrastructure assets, the best possible infrastructure performance. The IBS, in particular, becomes useful as a statement of the value of those assets. But the IBS alone is inadequate.

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Infrastructure Performance Dictionaries define performance as the accomplishment of a task of the fulfillment of a claim or promise. For infrastructure, this means delivering at least the services people expect infrastructure to provide. It may, however, mean more. People’s expectations change, and the services infrastructure must provide then change as well. For example, when such federal legislation as the Clean Air Act and the Safe Drinking Water Act were passed, they represented new expectations for the performance of local infrastructure. A National Research Council study defined performance as the degree to which infrastructure provides the services the community expects of it, measured in terms of effectiveness, reliability, and cost (“Measuring...”, 1995). Effectiveness is multidimensional, encompassing quantity and quality of service and a range of regulatory and community concerns that may or may not be reflected in the generally held view of what services are to be provided. For example, highways are meant primarily to provide mobility for people and businesses in a metropolitan areas, but there are air quality restrictions, noise problems, and visual aspects of highways that the community may consider in judging whether the highway system is performing adequately. The community making this judgement includes not only the drivers and passengers of vehicles that use the roads, but also the highway’s neighbors, shippers of goods that travel by truck, and the taxpayers and government officials who own and operate the highway network. Measuring the condition of a region’s infrastructure, in terms of the values of assets and liabilities, depends on being able to measure performance as well. Implicit in the concept of the IBS as a useful management tool is the expectation that the infrastructure system is performing at least adequately. This is analogous to the balance sheet used in industry, which presumes that a business is a “going concern.” In industry, a company’s balance sheet alone is insufficient to portray the company’s condition; an income statement is required as well. The income statement shows whether the business was profitable during the time period being reported. Similarly, the performance assessment tells whether the infrastructure is meeting expectations. And just as a company's management information system is designed to assist corporate managers to operate their company effectively, the IIMS will be designed to provide a complete report on the infrastructure of an area.

Structure and Development of the IIMS The I2 Partnership's research program includes efforts to devise practical performance measurement tools and performance forecasting methods. These tools, and the IBS, are envisioned as pieces of the IIMS, a larger management decision support system. The development and success of the IIMS depend not only on research on issues such as those discussed in the preceding sections, but also on putting the results of research into practice. Making the several component parts of the IIMS fully effective may generally require development and application of new technology, and both education of young and

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training of experienced practitioners. These related activities of the I2 Partnership will be described further in the next section of this paper.

Infrastructure Performance

Data collection & analysis - condition assessment - GIS & remote sensing - inventories evaluation

Performance modeling - deterioration forecasting - demand forecasting - impacts assessment - technology forecasting

Management alternatives & scenarios generation - renewal engineering - capital investment strategy - financial strategy - institutional development

Funds, policy priorities & budgets

Decision analysis - benefit/cost methods - optimization techniques - risk management - planning, programming, and - budgeting systems

IIMS Management decisions & actions

Management reports - balance sheets (e.g., IBS) - performance records - service and accomplishments budgets

Figure 4. Conceptual structure of the IIMS professionals Figure 4 illustrates the general structure of the IIMS. Gaining easy access to data on the current characteristics, condition, and performance of the infrastructure system is an essential first step in effective management. The City of Indianapolis, for example, has

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recently completed thorough inventories of stormwater culverts, rail lines, and bridges within its jurisdiction. The city also uses the “Paver” pavement management system, IIMS outputs and interactions with decision makers BALANCE SHEET

SIMULATIONS

Where we might be or could be...

Where we are...

System behavior in response to alternative spending levels

Implications of characterization and weighting of objectives and constraints

JUDGEMENTS & BUDGET DECISIONS

Where we want or ought to be.

Consequences observed from application of funds - capital spending - current spending

Figure 5 IIMS Output: reports and simulations developed by the U.S. Army Corps of Engineers and American Public Works Association (APWA) Research Foundation, which incorporates a detailed inventory of highway and street pavement conditions. The city requires that “as-built” drawings of newly developed public structures be delivered as computer-aided design (CAD) files, i.e., in machinereadable form. These various inventories will become part of the IIMS implementation in Indianapolis. Other city infrastructure elements– e.g., parks, water-supply facilities, sanitary and storm sewers– may require field surveys before they can be fully incorporated into the IIMS. Additional work may be required to integrate data on these several sub-systems into a single cadastral framework, to produce a fully developed geographic information system (GIS). Other local or state governments joining the I2 Partnership may have different data collection and analysis resources already available. Performance modeling, the generation of management alternatives and scenarios, and decision analysis will be the objects of much of the I2 Partnership research and development activities. Several of the issues that will receive early attention in the I2 Partnership's programs have already been discussed. The output of the IIMS will be management information, reported to decision-makers. These decision-makers are the users of the IBS (refer to Table 1) and other products of the IIMS. The task of assuring that this information is presented in a timely manner, in forms that support good decisions, is itself a worthy topic for research, technology application, and education. The IIMS reports will inform management action. The reports provide not only useful information, but also a basis for considering what might happen under alternative assumptions about the future. The results of exploring alternative scenarios (an activity

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the IIMS would be designed to support) will be a series of “what if” simulations that can help decision makers envision the future and better understand the possible consequences of their choices. Figure 5 illustrates these simulations within the context of the IBS. The IIMS reports and simulations, through their influence on management decisions, will in turn influence funds allocations, policy priorities, and system performance. Over the longer term, improvements in infrastructure performance will be the measure of the I2 Partnership's success

Acknowledgment This work was made possible by a grant from the National Science Foundation (Award Number: 9526080).

References Burkhardt, J. and Gallant, G. (1994), “Infrastructure balance sheet: Concept and proposal,” A Proposal to the City of Indianapolis, September 2. Infrastructure for the 21st Century (1987), Committee on Infrastructure Innovation, National Research Council, Washington, D.C.: National Academy Press. In Our Own Backyard-Principles for Effective Improvement of the Nation’s Infrastructure (1993), Albert A. Grant and Andrew C. Lemer, editors, Committee on Infrastructure, Building Research Board, Washington, DC: National Academy Press. Measuring and Improving Infrastructure Performance (1995), Committee on Measuring and Improving Infrastructure Performance, Board on Infrastructure and the Constructed Environment, Washington, DC: National Academy Press

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APPENDIX A Selected Bibliography on Infrastructure Performance Management This bibliography is a work in progress. Designed to include references addressing principles, methodology, policies, and historical background related to infrastructure performance management and management tools such as balance sheets and information systems, the bibliography is being assembled as a resource from the I2 Partnership’s work. The range of infrastructure included here is broad, starting from a definition proposed by two committees of the National Research Council. (Infrastructure for the 21st Century, 1987; In Our Own Backyard-Principles for Effective Improvement of the Nation’s Infrastructure, 1993). For the members of those committees and for the I2 Partnership, infrastructure includes: Both specific functional modes (e.g., highways, streets, roads, and bridges; mass transit; airports and airways; water supply and water resources; wastewater management; solid-waste treatment and disposal; electric power generation and transmission; telecommunications; and hazardous waste management) and the combined system these modal elements comprise not only these public works facilities, but also the operating procedures, management practices, and development policies that interact together with societal demand and the physical world to facilitate the transport of people and goods, provision of water for drinking and a variety of other uses, safe disposal of society’s waste products, provision of energy where it is needed, and transmission of information within and between communities.

To the traditional public works modes in that description were added: Systems of public buildings-schools, health care facilities, government offices, and the like. These facilities are not included as individual buildings, but are tied together by the functional and administrative systems they house. Parkland, open space, urban forests, drainage channels and aquifers, and other hydrologic features also qualify as infrastructure, not only for their aesthetic and recreational value, but because they play important roles in supplying clean air and water.

Included in this bibliography are references that provide perspective on issues of infrastructure management directly and as it may influence environmental quality, economic development, social structure, regional growth and decay, and technological evolution that may influence management objectives and decisions: Abernethy, Charles L., 1986, Performance Measurement in Canal Water Management: A Discussion. ODI/IIMI Irrigation Management Network 86/2d, London: Overseas Development Institute. Agthe, Donald E.; Billings, R. Bruce, 1987, Equity, price elasticity, and household income under increasing block rates for water, The American Journal of Economics and Sociology, July 1987, v.46, n.3, p. 273 (14). American Public Works Association, 1976, History of public works in the United States, 1776-1976, Chicago. Appleyard, Donald. 1964. The view from the road, Cambridge, Published for the Joint Center for Urban Studies of the Massachusetts Institute of Technology and Harvard University by the M.I.T. Press, Massachusetts Institute of Technology.

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Assessing pavement maintenance needs. 1987. Transportation Research Board. Transportation Research Record 1109, Washington, D.C.: National Research Council. ASTM. 1986. Building performance: function, preservation, and rehabilitation: a symposium sponsored by ASTM Committee E-6 on Performance of Building Constructions, Bal Harbour, FL, 17 Oct. 1983, ASTM Special Technical Publication, STP-901, Philadelphia, PA. ASTM. 1990. Performance of buildings and serviceability of facilities, ASTM Special Technical Publication, STP1029, Philadelphia, PA. Azad, B. and Jacobs, M. 1986, Infrastructure Finance and Institutions, A Review of International Experience. Report No. 47, Multi-regional Planning Staff, Department of Urban Studies and Planning, Massachusetts Institute of Technology, September 1986, Cambridge, Massachusetts. Beito, David T.; Smith, Bruce, 1990, The formation of urban infrastructure through nongovernmental planning: the private places of St. Louis, 1869-1920, Journal of Urban History May 1990, v16, n3, p. 263 (41). Browne, L. E. 1991, The role of services in New England’s rise and fall: engine of growth or along for the ride? New England Economic Review (July/August 1991): 27-41. Center for Urban Policy Research. 1976. Solid waste planning in metropolitan regions. New Brunswick, NJ: Rutgers University. Chertow, Marian R. 1989, Garbage solutions: a public official’s guide to recycling alternative solid waste management technologies. Washington, D.C.: U.S. Conference of Mayors. City of Cincinnati, 1991. Building Cincinnati’s Future: Infrastructure Improvement Program. Performance Report, Number 4. City of Cincinnati, 1991. 1990 Annual Performance Report: Measures of Success: A Special Performance Report on City of Cincinnati Operations. Cronon, William, 1991. Nature’s metropolis: Chicago and the Great West. 1st Ed. New York: W. W. Norton Data for Decisions: Requirements for National Transportation Policy-Making. 1992. Special Report 234, Transportation Research Board. Washington, D.C.: National Research Council. Eisner, R. 1991, Infrastructure and regional economic performance: comment. New England Economic Review (September/October 1991): 47-58. Enhance Reinsurance Company, 1991, Infrastructure Investment, A Historical Overview. New York: Enhance Financial Services Group, Inc. Fiering, Myron B. 1978, Standards, optimality and resilience in water-resource management: final report. Cambridge, Mass.: Division of Applied Sciences, Harvard University.

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Fragile Foundations: A Report on America’s Public Works. 1988, National Council on Public Works Improvement, Final Report to the President and Congress, Washington, D.C.: US Government Printing Office. Fundakowski, R.A., 1991. Video image processing for evaluating pavement surface distress. A digest of report, NCHRP Research Results Digest no. 181 (December 1991): 1-4. Gakenheimer, Ralph, 1989. Infrastructure shortfall: the institutional problems, Journal of the American Planning Association, Winter 1989, v55, n1, p14 (10). Godwin, Stephen R., and George E. Peterson, 1984. Guide to Assessing Capital Stock Condition. Guides to Managing Urban Capital, Vol. 2. Washington, D.C.: Urban Institute Press. Grigg, Neil S., 1986. Urban water infrastructure: planning, management, and operations. New York: Wiley. Gullo, Teri, David Parham, and George E. Peterson, 1984, The Role of Standards in Infrastructure Management. Washington, D.C.: The Urban Institute. Harrison, David, 1978. The impact of transit systems on land use patterns in the preautomobile era, Discussion paper - Harvard University, Department of City and Regional Planning; D78-21. Cambridge: Harvard University, Department of City and Regional Planning. Humplick, F. F. Theory and Methods of Analyzing Infrastructure Inspection Output: Application to Highway Pavement Surface Condition Evaluation Infrastructure for the 21st Century, 1987, Committee on Infrastructure Innovation, National Research Council. Washington, D.C.: National Academy Press. In Our Own Backyard-Principles for Effective Improvement of the Nation’s Infrastructure, 1993, Albert A. Grant and Andrew C. Lemer, editors, Committee on Infrastructure, Building Research Board. Washington, DC: National Academy Press. Jenkins, Robin R., 1993. The economics of solid waste reduction: the impact of user fees, New horizons in environmental economics, Aldershot, Hants, England; Brookfield, VT, USA: E. Elgar Pub. Jones, D., 1986, Financial Appraisal of Public Infrastructure Projects and Implementing Institutions: Guidance for Financial Intermediaries. Report No. UDD-95, Water Supply and Urban Development Department, Operations Policy Staff, World Bank, April 1986. Kilgore, Roger T., Michael N. Zatz, and G. Kenneth Young, 1991, The Relationship Between Standards and the Performance of Infrastructure. Springfield, VA: GKY and Associates, Inc. Kirby, J. G. and J. M. Grgas, 1975. Estimating the life expectancy of facilities. Technical Report P-36 USA Construction Engineering Research Laboratory. Lemer, Andrew C. 1992, “Measuring Performance of Airport Passenger Terminals.” Transpn. Res.-A 26A(1): 37-45.

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McCallum, W. R. 1963, Highway Bond Financing, An Analysis: 1950-1962, US Department of Commerce, US Bureau of Public Bonds. Washington, D.C.: Government Printing Office, pp.41-42. McDowell, Bruce D., 1992, Public Works for Tomorrow. Intergovernmental Perspective 18(3): 23-25. McShane, 1979, Street Pavements, Journal of Urban History, May 1979, pp. 296-78. Measures of Marine Container Terminal Productivity. Improving Productivity in U.S. Marine Container Terminals. 1986. Committee on Productivity of Marine Terminals, Marine Board. Washington, D.C.: National Academy Press. Measuring and Improving Infrastructure Performance, 1995. Committee on Measuring and Improving Infrastructure Performance, Board on Infrastructure and the Constructed Environment. Washington, DC: National Academy Press. Memmott, Jeffery L., Margaret K. Chui, and William F. McFarland. 1993. CBO’s Assessment of Transportation Infrastructure Needs: Critique and Extension. College Station, TX: Texas Transportation Institute, Texas A&M University. Menendez, A. 1991. Access to Basic Infrastructure by the Urban Poor. Economic Development Institute: Policy Seminar Report no. 28. Washington, D.C.: The World Bank. Menell, Peter S. 1991. Optimal multi-tier regulation: an application to municipal solid waste. Cambridge, MA: Center for Science & International Affairs, John F. Kennedy School of Government. Munnel, A. H. 1990. How does public Infrastructure affect regional economic performance? New England Economic Review (September-October 1990): 11-33. Nelson, Arthur C.; Knaap, Gerrit J. 1987. A theoretical and empirical argument for centralized regional sewer planning. Journal of the American Planning Association Aut 1987, v53, n4, p479(8). O’Connell, Gary B. 1989. Rate your city - here’s how! (rating of a city’s infrastructure) Public Management June 1989, v71, n6, p7(4). Olson, David J. 1992. Governance of U.S. Public Ports: A Preliminary Survey of Key Issues. Washington, D.C.: Marine Board Port Governance Roundtable, Nov. 10, 1992. Organization for Economic Co-operation and Development. 1980. Urban public transport: evaluation of performance. A report prepared by an OECD Road Research Group. Paris: OECD. Organization for Economic Co-operation and Development. Waste Management Policy Group. 1981. Economic instruments in solid waste management. Paris: Organization for Economic Co-operation and Development; [Washington, D.C.: OECD Publications and Information Center, distributor]. Ostrom, E., Schroeder, L., and Wynne, S., 1993, Institutional Incentives and Sustainable Development: Infrastructure Policies in Perspective. Boulder: Westview Press.

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Parkinson, Tom. 1992. Rail Transit Performance. Transportation Research Record 1361:47-52. Peterson, Dale E. 1987. Pavement management practices. Synthesis of highway practice; 135. Washington, D.C.: Transportation Research Board, National Research Council. Peterson, George E., Mary John Miller, Stephen R. Godwin, Carol Shapiro. 1984. Guide to Benchmarks of Urban Capital Condition. Guides to Managing Urban Capital, Vol. 3. Washington, D.C.: Urban Institute. Pollock, Cynthia. 1987. Mining urban wastes: the potential for recycling. World-wide paper; 76. Washington, D.C., USA: Worldwatch Institute. Rogers, Peter P. 1978. The interaction between urbanization and land: quality & quantity in environmental planning and design; water resources: water quantity and water quality. NSF/RA-780427. Cambridge, Mass.: Landscape Architecture Research Office, Graduate School of Design, Harvard University. Snickars, F. 1989. Effects of Infrastructure Provision on Urban Economic Development. Infrastructure and Building Sector Studies:29 Working Paper from CERUM 1989. Stover, Mark Edward. 1987. The role of infrastructure in the supply of housing. Journal of Regional Science May 1987, v27, p255(13). Subcommittee on Economic Goals and Intergovernmental Policy of the Joint Economic Committee, U.S. Congress. 1984. Hard Choices: A Report on the Increasing Gap Between America’s Infrastructure Needs and Our Ability To Pay for Them. S.Prt. 98-164. Washington, D.C.: U.S. Government Printing Office. Svedinger, Bjorn. 1991. The Technical Infrastructure of Urban Communities: A Survey of Current Knowledge. Stockholm: Swedish Council for Building Research. Tarr, Joel A. 1979. The separate vs. combined sewer problem: a case study in urban technology design choice. Journal of Urban History 5, 308-339. U.S. Congress, Congressional Budget Office. 1991. How Federal Spending for Infrastructure and Other Public Investments Affects the Economy. July, 1991. U.S. Congress, House of Representatives. 1990. Infrastructure Needs Assessments and Financial Alternatives. Hearing Before the Subcommittee on Policy Research and Insurance of the Committee on Banking, Finance and Urban Affairs. May 8, 1990. Serial No. 101-117. U.S. Congress. Office of Technology Assessment. 1991. Delivering the Goods: Public Works Technologies, Management, and Financing. OTA-SET-477. Washington, D.C.: US Government Printing Office. United States. Office of Solid Waste, Office of Policy, Planning, and Evaluation, Environmental Protection Agency. 1990. Sites for our solid waste: a guidebook for effective public involvement. Washington, D.C.: EPA. Wolf, S. 1988. Nondestructive Evaluation of Pipelines. A paper presented in the First International Conference on Underground Infrastructure. November 15-17, 1988

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