Valuation of Road Assets 2023

This guide has a focus on three aspects of capacity building for road valuation in a climate change future. 1. Impact of climate change on infrastructure valuation and sustainability reporting. Assets that are not strong enough to be climate change resilient are exhibiting shorter useful lives and higher renewal unit costs than previously estimated in financial statements. Increases in depreciation are likely to be significant with a flow on adverse impact on financial sustainability reporting. 2. A whole of Government Strategic Response to Climate Change. Local Government works with all agencies on front line response during natural disasters and with communities in rebuilding damaged infrastructure. NSW Disaster Assistance Guidelines released in 2021 do not allow for funding for treatments that can strengthen assets for future disasters, resulting in councils being forced to apply road treatment techniques that are waste of community wealth, have short lives and fail repeatedly at each successive disaster event. 3. Evidence based validation of valuation inputs such as unit costs and useful lives is an important part of a comprehensive valuation process. This validation should be done by experts with engineering qualifications appropriate to make estimates on these key valuation inputs. These estimates now need to consider the climate change resilience of current road assets in making estimates on useful lives and unit costs. Valuation estimates need to transparently report on the reliability of inputs taking into account: • Data and information gathering. • Risk assessment and vulnerability analysis. • Regulatory compliance. • Monitoring and maintenance • Technology and innovation.