A framework for selection of asset valuation methods for civil infrastructure

Highway networks generally represent the largest asset of public infrastructure. Management of the performance of this asset through timely rehabilitation and/or maintenance is well understood, however, less is known about how to manage the value within the context of public-private partnerships or other delivery models. The recent trend to privatization coupled with a new requirement to report tangible capital assets on annual government statements has focused the need for an understanding of the impact of valuation method and performance prediction models on network asset valuation. Asset valuation holds great promise as a readily understood (to the public and private sector) performance measure and, as an asset management integration mechanism for trade-off analysis between competing components (pavement, bridges etc.). However, there is no framework available to guide engineers in the selection of which valuation method to use for which asset category. Using the City of Edmonton pavement database as a case, the network asset valuation is calculated for five valuation methods to gain an understanding of the variation between methods and, as such, the impact of selecting one approach over another. Based upon the analysis, a framework is proposed for selection of asset valuation method by asset category and a proposed integration model presented that can be applied to any asset within the right-of-way. This framework provides some guidance to agencies embarking on valuation of their transportation assets.