University of Illinois at Urbana ChampaignThe University of MaineUniversity of Maine at AugustaUniversity of Maine at FarmingtonUniversity of Maine at MachiasUniversity of Maine at Presque IsleUniversity of Maine at Fort KentUniversity of MarylandUniversity of Massachusetts  AmherstUniversity of Massachusetts  BostonUniversity of Massachusetts  DartmouthUniversity of Massachusetts  LowellUniversity of Michigan University of Minnesota

Sightlines LLCFY10 F iliti MB&A P t ti

University of Minnesota University of MissouriUniversity of Missouri ‐ Kansas CityUniversity of Missouri ‐ St. LouisUniversity of New HampshireUniversity of New HavenUniversity of Notre DameFY10 Facilities MB&A Presentation

University of Maine SystemUniversity of OregonUniversity of PennsylvaniaUniversity of PortlandUniversity of RedlandsThe University of Rhode Island, Narragansett BayThe University of Rhode Island, Feinstein ProvidencTh U i it f Rh d I l d Ki tJanuary 10th, 2011

Presented by: Jim Kadamus

The University of Rhode Island, KingstonUniversity of RochesterUniversity of San DiegoUniversity of San FranciscoUniversity of St. Thomas (TX)University of Southern MaineUniversity of ToledoyUniversity of VermontUpper Iowa UniversityUtica CollegeVassar CollegeVirginia Commonwealth UniversityVirginia Department of General Services

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Wagner CollegeWellesley CollegeWesleyan UniversityWest Chester University of PennsylvaniaWest Virginia University Western Oregon UniversityWheaton College (MA)

A vocabulary for measurementThe Return on Physical Assets – ROPASM

Th l Th l t d Th ff ti Th fThe annual investment needed to insure buildings will properly perform and reach

The accumulated backlog of repair and modernization needs and the definition of

The effectiveness of the facilities operating budget, staffing,    supervision and

The measure of service process, the maintenance quality of space and systems and the

Annual

perform and reach their useful life “Keep‐Up Costs”

Asset

definition of resource capacity to correct them. “Catch‐Up Costs”

Operational

supervision, and energy management

systems, and the customers opinion of service delivery

Annual Stewardship

Asset Reinvestment

Operational Effectiveness Service

Asset Value Change Operations Success

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Core Observations

Aging Campus Profile:Although the Maine System has seen some recent new space and major renovations, 68% of System space is over 25 years of age, a time at which critical b ildi d d d i i d dbuilding needs come due and investment is needed.

Historically Low Capital Investment:Annual Stewardship funding has been insufficient to meet SightlinesAnnual Stewardship funding has been insufficient to meet Sightlines recommended investment targets across the System.  Furthermore, one‐time infusions of capital have been inadequate to make up the annual shortfall andaddress the growing backlog of needs.address the growing backlog of needs.

Solid Operations Performance:Solid operations metrics, generally satisfied customers, and strong energy p g y g gymanagement indicate effectiveness of  campus facilities staff despite limited funds and generally inadequate service process.

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UM System age profile – 68% of space over 25 years oldUM System Total GSF: 9.03 Million

Renovation Age Profile by Category

44%

40%

45%

50%Renovation Age Profile by Category

35%33%

30%

35%

40%

19%

12%

21%19%

16%15%

20%

25%

12%

5%

10%

15%

0%Under 10 10 to 25 25 to 50 Over 50

UM System Public University Database Average

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y y g

Density Factor

Smaller Institutions Larger Institutions

Density Factor varies across UM System; Augusta is unique to the system

Smaller Institutions Larger Institutions

Impacts:

• Custodial operations

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• Wear and tear on campus facilities

• Lifecycles of building components

University of Maine System Investment Profile

System Total Project Spending‐ $253M Since FY06Funding Sources: Appropriations, Revenue/State Bonds, Gifts/Grants, Reserves, & Funded Depreciation

$3.4

$5.9

$60 0

$70.0

$80.0y y

5‐Year Capital Investment Distribution

$44.6$45.8

$8 9

$1.5$1.0$40.0

$50.0

$60.0

llion

s

UM System Annual Average ‐ $50.6M 5%

$$31.6

$26.0 $8.9

$4.9$1.6$20.0

$30.0

$ in M

i

43%

52%$20.5 $18.4

$24.0$15.3

$0.0

$10.0

2006 2007 2008 2009 2010

52%

Existing Space New Space Non‐Facilities

36% 48% 9% 7%New Space Investment Distribution

66

36% 48% 9% 7%

0% 20% 40% 60% 80% 100%UM USM UMF Remaining Campuses

Investment into existing spaceAnnual Investment level half that of  Sightlines Public University average

Average Annual Capital Investment – Existing Space (FY06‐FY10)

$4.50

$5.00Average Annual Capital Investment  Existing Space (FY06 FY10)

SL Public University Annual avg. ‐ $4.31/GSF

$3 00

$3.50

$4.00

$2.00

$2.50

$3.00

$/GSF

UM System Annual avg. ‐ $2.13/GSF

$1.00

$1.50

$0.00

$0.50

UM USM UMA UMF UMFK UMM UMPI

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UM USM UMA UMF UMFK UMM UMPI

Total Project Spending in Existing SpaceUM System investment lower than public database; investment mix comparable  

T t l P j t S di UM System 5 Year Investment Mix

$5 00

$6.00  Total Project Spending12%15%

y

$4.00 

$5.00 

$3 40/GSF

28%

13%

32%

$3.00 

$/GSF

$3.40/GSF

$1.50/GSF

13%

Building Envelope Building SystemsInfrastructure Space RenewalSafety/Code

Sightlines Public University 5 Year

$2.00 13%8%

Sightlines Public University 5 Year Investment Mix

$‐

$1.00 

28%32%

88

$

2006 2007 2008 2009 2010UM System SL Public University Average

19%

Annual Stewardship

Setting Investment goals to maintain System

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FY2010 Stewardship Targets

Defining stewardship investment targetsMeeting targets enables System to maintain Net Asset Value 

$60.00 

$70.00 

FY2010 Stewardship TargetsUM System Replacement Value: $2.2 Billion

$65 7$27.7$40.00 

$50.00 

Millions

$65.7

$24.5 $18 4

$13.8

$10 00

$20.00 

$30.00 

$ in 

$ $18.4

$0.00 

$10.00 

3% Replacement Value UM Life Cycle Need Annual Funding Target

Envelope/Mechanical Space/Program

Total $ in Millions $65.7 $52.2 $32.2

% of Replacement 3% 2 4% 1 5%

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Straight Line Depreciation Model Sightlines Recommendation

% of Replacement 3% 2.4% 1.5%

Total capital investment over time

$

UM System reaching target zone in only one of the last five years

Total Capital Investment FY06‐FY10

$50.0

$55.0

$60.0

Increasing Asset Value

Total Capital Investment FY06 FY10

$35.0

$40.0

$45.0

ns

Stabilizing Asset Value

$20 0

$25.0

$30.0

$ in M

illion

Declining Asset Value

$10.0

$15.0

$20.0

$0.0

$5.0

FY2006 FY2007 FY2008 FY2009 FY2010

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Recurring Capital One‐Time Capital

Total Project SpendingUM System historically funding less than other public institutions

140%

SL Public Database University of Maine System

100%

120%

Fund

ed

Annual Funding Target

60%

80%

Total %

 Target F

20%

40%

0%

FY2006 FY2007 FY2008 FY2009 FY2010 FY2006 FY2007 FY2008 FY2009 FY2010

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Asset Reinvestment Backlog EstimationRegional cost differences impact $/GSF backlog vs. public database average

T t l A t R i t t B kl $/GSF M i t R i B kl $/GSF

$$60.00 $70.00 $80.00 $90.00 

Total Asset Reinvestment Backlog $/GSF

$680M ‐ $720M Approximately

Maintenance Repair Backlog $/GSF

$10.00 $20.00 $30.00 $40.00 $50.00 

($75 ‐ $80/GSF)

Approximately $80/GSF

$350M ‐ $400M

($40 ‐ $45/GSF)

Approximately $45/GSF

$‐

UM System SL Public University Avg. UM System‐Maint/Repair SL Public University Avg‐Maint/Repair

Total Asset Reinvestment Backlog $/GSF by Campus

$60.00$70.00 $80.00 $90.00 

$100.00 g y p

Campus Backlog $/GSF Range:  $70 – $92 

$10 00$20.00 $30.00 $40.00 $50.00 $60.00 

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$‐$10.00 

UM USM UMA UMF UMFK UMM UMPI

System NAV Index

Campus NAV’s: FY10

90%

100% Capital Upkeep Stage: Primarily new or recently renovated buildings w/ sporadic building repair & life cycle needs; “You pick the projects”

Campus NAV s: FY10

70%

80%Repair and Maintain Stage: Buildings are beginning to show their age and may require more significant investment on a case‐by‐case basis

60%

70%

Systemic Renovation Stage: Buildings may require more significant repairs ; large‐scale capital infusions/renovations are inevitable; “The projects pick

40%

50%

inevitable;  The projects pick you”

Demolition/Transitional Stage:  Major buildings components are 

30%

UM USM UMA UMF UMFK UMM UMPI

in jeopardy of complete failure.  Reliability issues are widespread throughout campus.

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NAV Index

Replacement Value – AR BacklogNAV = Replacement Value

Campus Operations

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Facilities Operating BudgetSystem budget higher than Public University Average

$8 00 UM System: 5‐ YearFY2010 Facilities Operating Budget

36%

$7.00 

$8.00  UM System: 5‐ Year Distribution

p g g

$1.14/GSF

62%

36%$2.92 

$2.00 $5.00 

$6.00 

2%$0.12 $0.29 

$

$4.00 Public Database : 5‐ Year 

34%$4.48  $4.10 $2.00 

$3.00  Distribution

61%5%$‐

$1.00 

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5%$

UM System Public DatabaseDaily Service Planned Maintenance Utilities

UM System Energy AnalysisBoth unit cost and consumption decrease in FY10

S t C it T t l U it C t S t C it E C ti

$16.00 

$18.00 

$20.00 

System Composite Total Unit Cost

140,000 

160,000 

System Composite Energy Consumption

$10.00 

$12.00 

$14.00 

BTU 80,000 

100,000 

120,000 

BTU/G

SF

$2 00

$4.00 

$6.00 

$8.00 

$/MMB

20,000 

40,000 

60,000 

B

$‐

$2.00 

2006 2007 2008 2009 2010‐

,

2006 2007 2008 2009 2010

UM System achieved approx. $3.2M of energy savings in FY10 due to reductions in both unit costs and consumption

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reductions in both unit costs and consumption.

Service Process in need of improvement across SystemImproved service process will make facilities operations more proactive and efficient

Smaller Institutions Larger InstitutionsSmaller Institutions Larger Institutions

Install a functioning Install a 

functioning Make sure the system provides Make sure the system provides 

Streamline your work‐order 

Streamline your work‐order  Clearly define 

who does whatClearly define who does what

Track and report frequently for 

Track and report frequently for 

Enhancing your Service Process

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systemsystem more than datamore than data processprocess who does whatwho does what reliable datareliable data

Bringing it all together

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Concluding Comments

Key UM System recommendations based on ROPA Study:Key UM System recommendations based on ROPA Study:

1. Develop an annual stewardship investment strategy focused on envelope/mechanical lifecycle replacements.  Initial funding targets should be set at peer levels with a plan to increase funding to the full annual stewardship target.full annual stewardship target.  

2. A portion of the annual investment should continue to come from campus operating budgets, possibly supported by increasing efficiencies in daily operations and reducing energy costs.

3. Update/expand the database of deferred maintenance projects.  This is a necessary step to target future capital investments in buildings that have the highest priorities and most significant problems.

4. Develop a request for capital funding that targets priority projects that will raise the overall Net Asset4. Develop a request for capital funding that targets priority projects that will raise the overall Net Asset Value of campuses in the system as a whole.  A capital allocation for existing space of $40M‐$50M/year over the next 5 years is needed to begin drawing down on the deferred maintenance backlog.

5. Limit funding for new space unless that space is replacing obsolete buildings with significant reliability5. Limit funding for new space unless that space is replacing obsolete buildings with significant reliability problems.

6. Modernize the Integrated Work Management System to improve  effectiveness of facilities operations.  

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7. Develop a comprehensive energy plan to identify and implement campus projects that will provide additional energy savings.