Ararat Rural City Council I Vincent St Ararat I Ph. 03 5355 0200 www.ararat.vic.gov.au

Rural Roads Renewal

Council has altered work practices and design standards to ensure roads are built to Austroads guidelines including increasing pavement thickness, utilising certified crushed rock and adopting construction methods that will ensure investment in roads is not lost due to re-work.

Ararat Rural City Council manages approximately 700 kilometres of sealed roads and 1,350 kilometres of unsealed gravel roads. In addition to this, there are about 300 kilometres of natural surface roads. Annually, Council spends on average between $3.9M and $4.0M on renewal and upgrade.

Rural roads are increasingly required to manage the transport task associated with B-Double and Higher Mass Limit Vehicles in support of the agricultural sector and associated supporting businesses. The sector’s reliance on transport to receive inputs and to dispatch produce is growing. The productivity gains associated with heavy transport, and in particular permit based vehicles, requires last mile access to the farm gate. This adds to the cost of managing the road network when consideration is given to the standards roads were originally constructed to and the rate at which they are consumed.

Roads within the municipality have historically been constructed from naturally occurring surface gravels which lack strength and durability. Roads are often narrow including those with single lane seal. Where road reconstruction and renewal has been undertaken using natural gravels these roads have failed prematurely and well within the effective life expected from asset management planning.

In response to this, Ararat Rural City Council has altered work practices and design standards to ensure roads are built to Austroads guidelines including increasing pavement thickness, utilising certified crushed rock and adopting construction methods that will ensure investment in roads is not lost due to re-work. These changes have been implemented with operational efficiencies resulting in costs being constrained despite overall construction costs increasing. Increases of contracted

works have been significantly greater. Currently Council’s operational staff are delivering road construction work at between 55% and 75% of the cost of the commercial sector. We are also trialling the use of stabilising agents to extend the life and performance of unsealed roads constructed from natural gravel.

Council has recently committed to a broad scale community engagement process to develop a strategic transport network with the aim of focusing resources to those roads that provide the most benefit to the community. An outcome associated with this could be a reduction in service standards to minor roads with some roads being allowed to return to natural surface and becoming dry weather access only roads. This has some potential to reduce Council’s renewal liability.

May 2018

Ararat Rural City Council I Vincent St Ararat I Ph. 03 5355 0200 www.ararat.vic.gov.au

It will be difficult for Council to achieve further economies. Analysis of renewal costs shows that Council is unable to fully fund the renewal of the road network. External funding sources such as Roads to Recovery and Financial Assistance Grants in combination with Council’s contribution from rates is insufficient to meet current needs. Council has been actively seeking grant funding

to supplement its budget with some success, but not in all cases. Dependency on competitive funding bids will not resolve the current shortfalls.

A summary of the road network valuation and expenditure is provided below. This shows a renewal gap of between $3.3M and $4.5M. In the current economic

circumstances with rate capping and limited capacity and willingness of the community to make greater contribution, Council does not have the capacity to renew its road assets on a sustainable basis. The shortfall in renewal will have further impact by driving up recurrent costs through increased maintenance liability.

Sealed Roads

Sealed Road Wearing Surface

Unsealed Roads

700km3.77M sqm

Council Cost ($55/sqm)

Contractor Cost($80/sqm)

700km3.77M sqm

Contractor Cost ($4.5/sqm)

1350km5.64M sqm

Council Cost ($7/sqm)

Value of Sealed Road Pavement

$207M

$300M

Value of Sealed Road Pavement

$17M

Value of Unsealed Roads

$39.5M

Annual Renewal Cost (75 year effective life)

$2.76M

$4.0M

Annual Renewal Cost (15 year effective life)

$1.13M

Annual Renewal Cost (12 year effective life)

$3.3M

3 Year Average Renewal Expenditure

$1.85M

$1.85M

3 Year Average Renewal Expenditure

$1.4M

3 Year Average Renewal Expenditure

$680k

Renewal Gap

$900k

$2.15M

Renewal Gap

-$270k

Renewal Gap

$2.6M