Asset Revaluation using Benchmark Software

Abstract

Historically, the City of Gold Coast (the City) has developed infrastructure asset unit rates using a number of large and complex excel spreadsheets. The basic methodology entailed first principles cost estimating using input rates (e.g. labour, plant, materials) with assumptions around standard design drawings, productivity, construction methodology and overheads. These formed the basis of construction unit rates taking into account factors such as material, size, environment, location (urban density) and depth. The sheer volume of unit rates (e.g. 24,000 for Flood Mitigation and Drainage assets alone) meant that annual revaluations were labour and time intensive. There was a need to improve timeliness, performance and accuracy of the process, as well as promoting transparency for auditing purposes. A decision was made to invest in software that would improve efficiency and minimise risk of erroneous data inputs occurring, to improve overall confidence in valuation results. The City has used ‘Benchmark’ software now for both its Flood Mitigation and Drainage and Pathways revaluations. The tool has proved invaluable in effectively facilitating discussions with management and the Queensland Audit Office. It has instilled greater organisational confidence around the process, improving transparency, auditability, repeatability, error reduction and enabling consistent year to year comparisons. The development of customised dashboards has enabled staff to effectively communicate annual valuation variances and readily explain reasons for movement. The Benchmark tool provides visibility right down to resource level e.g. how a slight increase in the rate for a 12-ton excavator impacts the overall valuation amount and replacement cost of an asset. Key Benefits In summary, the benefits the City has gained moving to this method of estimation is: • Significant reduction in time and resource requirement for asset revaluations. • Greater transparency and visibility in tracking asset unit rate movement drivers down to resource rate level. Furthermore, overall valuation results from year to year can be easily examined, understood and compared in a consistent manner. • The key input rates and data are specifically provided by the City to ensure relevance and consistency with current in-house work practices. • Streamlined ability to undertake scenario analysis to test the impact of changing input costs, assumptions and construction parameters. • A more thorough first principles-based approach that relies on an extensive database/resource rate library. Unit rates are built up from resource components and schedule of quantities with the exact build-up and inclusions for each asset rate readily visible. • Efficient in that repetitive processes can be streamlined by use of libraries and routines that facilitate consistent outputs and enable easier peer review. • Readily updatable to account for changes in resource and contract rates, assumed productivity parameters etc. • Outputs can be presented in various formats e.g. dashboards and excel spreadsheets. • Key assumptions, production rates and resource allocations are clearly documented and auditable. • Functionality to bulk import items into the software such as resource rates, asset quantities, design specifications, and construction parameters and assumptions • Is a widely used estimating tool in the construction industry and is considered reliable.