Transportation Agency Context
For U.S. transportation agencies, the resource allocation process is influenced by the set of legislative and regulatory requirements related to transportation planning and programming.
Since the early 1970s, U.S. Metropolitan Planning Organizations (MPOs) and state Departments of Transportation (DOTs) have been required to develop long-range transportation plans (LRTPs). These plans establish the goals and objectives of an agency and detail its high-level investment plan (not necessarily listing specific projects) over a period of at least 20 years.
Requirements initiated by MAP-21 further specify that an LRTP should be performance-based, detailing forecasted performance using a set of federally specified performance measures, and additional “locally significant performance measures” if desired. These measures include summaries of good/fair/ poor condition for National Highway System (NHS) pavements and bridges. MPOs include performance measures and targets in their LRTPs. State DOTs have additional requirements to report shorter-term performance targets in different areas, including two- and four- year targets for NHS pavement and bridge condition.
In addition to developing LRTPs, MPOs and state DOTs are required to develop investment plans: each MPO develops a Transportation Improvement Program (TIP), while each state DOT develops a Statewide TIP (STIP). A TIP or STIP is a four-year (or more), fiscally constrained program of projects, including those that use federal funds (with some exceptions), additional “regionally significant” projects, and other projects the agency wishes to include. Because TIPs and STIPs are fiscally constrained, an agency must project its available revenue for the investments (typically capital) covered by the program over a period of at least four years, and many agencies have developed revenue projection models extending further into the future to support longer-range planning.
Beginning in 2018, again as a result of MAP-21, state DOTs are required to prepare TAMPs addressing pavements and bridges on the NHS at a minimum, while potentially including other asset classes and road systems. An agency’s TAMP describes the asset inventory and its conditions, how assets are managed over their life cycles, and a 10-year financial plan for how to best maintain assets in a “desired state of good repair.”
The various plans and programs cover different time periods and are intended to comply with different requirements. However, all of them may impact the resource allocation process, particularly with respect to allocation of funding for capital projects.
Information gathered and data analyzed in the TAM process should inform resource allocation decisions that agencies document primarily in their LRTPs, TIPs, or STIPs. This is where integration and collaboration with planning and programming groups within the agency is essential.
While these requirements are specific to the U.S., other countries have established their own planning and programming requirements, resulting in different—though frequently analogous—impacts to their resource allocation processes. Lessons learned from asset management experience in the U.S. and abroad include:
- In some cases organizations have implemented asset management programs and prepared asset management plans in response to legal requirements, while in others efforts to implement asset management concepts have been motivated by a desire to improve decision-making. While it is difficult to generalize, it appears that jurisdictions that adopt asset management planning by choice tend to realize the benefits much more quickly, improve service delivery, and allocate resources more effectively.
- Alignment of resource allocation to achieve goals and objectives is very important to ensure an agency advances from a traditional maintenance management approach, in which targets for asset conditions result from the available budget, to a performance-based approach in which an organization’s goals and objectives help define the required level of service (LOS) for its assets, which in turn drives resource allocation decisions.
- Organizational goals ideally should not focus on assets, or their condition, but the outcomes that are desired, such as improved mobility, safety and infrastructure resilience. Changing technology (CAV, communications), social (graying populations, work from home patterns, ridesharing), economic (integrated transportation modes), may be very relevant to how resource allocation should be conducted. Agencies that make resource allocations based largely on the condition and life cycle strategies of only the existing portfolio, may face greater challenges achieving their goals, and adapting to the changing needs of their economies.
- International, and US DOT agencies that have focused resource allocation on their goals and objectives, rather than on the existing assets they are responsible for, tend to be more readily able to leverage alternative service delivery models that may present service enhancement or cost saving opportunities. These agencies agree that “We don’t need to build it or own it or maintain it, to deliver mobility.”
Washington State DOT
Washington State DOT has worked closely with its legislature to adopt asset management based resource allocation policies.
The following is an excerpt from state legislation that was last updated in 2002:
”deficiencies on the state highway system shall be based on a policy of priority programming having as it’s basis the rational selection of projects and services according to factual need and an evaluation of life cycle costs...”
– RCW 47.05.010
This legislation along with good business practices has made Washington State DOT have one of the most mature asset management practices and an integrated set of tools, business processes, and organizational culture to support good asset management.