1. Sustainability and Total Cost of Ownership Strategies for Higher Education

2. Sustainability What Is Sustainability Sustainable Seattle Sustainability is the "long-term, cultural, economic and environmental health and vitality" with emphasis on long-term, "together with the Importance of linking our social, financial, and environmental well-being" http://www.scn.org/sustainable/susthome.html http://www.scn.org/sustainable/susthome.html Webster's New International Dictionary "Sustain - to cause to continue (as in existence or a certain state, or in force or intensity); to keep up, especially without interruption diminution, or in force or intensity); to keep up, especially without interruption diminution, flagging, etc.; to prolong." flagging, etc.; to prolong." “Forum for the Future” "A dynamic process which enables all people to realize their potential and to improve their quality of life in ways that simultaneously protect and enhance the Earth's life support systems."

3. Sustainability For Higher Education Sustainability for Higher Education is Focused on the Overall, Comprehensive Balanced Interaction of the Academic, Social, Physical, Environmental and Economic Health of the University Over It’s Lifetime.

4. What Is It? A Strategic Asset Management Process Which Considers ALL Costs and Requirements of Acquisition, Planning, Design, Construction, Operations and Maintenance, Renewal, Disposal, and Replacement Incurred over the Life of a Facility (typically 30 to 50 years). Total Cost of Ownership

5. Sustainability & Total Cost of Ownership Balanced Sustainability Modeling Principles of Sustainability for Higher Education are Focused on the Overall, Comprehensive Value of the Academic, Natural and Physical Environment Over Their Lifetime. To be Successful, These Principals Must Address 5 (Not 3 or the “Triple Bottom Line”) Specific Components: Mission, Economic, Environmental, Social and Operations.

6. Mission Sustainability Fundamentally, the Reason for Being. Understanding the Core Goals, Responsibilities and “Mission” of the Institution. In This Case, Education of Students. This is the Overriding Component. Mission Sustainability Revolves Around Three Specific Components: The Academic Program The Academic Program Student Recruitment & Retention Student Recruitment & Retention High Caliber Faculty and Staff High Caliber Faculty and Staff Sustainability & Total Cost of Ownership

7. Economic Sustainability: An Understanding of Investment Requirements and Life- Cycle Costs in a Total Cost of Ownership (TCoO) Framework. A Fundamental Responsibility to the Ensure that Dollars are Leveraged to Achieve the Most Efficient Result. Revenue Sources Include but are Not Limited to: State & Private Allocations, Tuition and Student Fees Donations and Foundation / Auxiliary Revenues Donations and Foundation / Auxiliary Revenues Equitable and Balanced Distribution Equitable and Balanced Distribution Sustainability & Total Cost of Ownership

8. Social Sustainability An Integration of the Social Ramifications to the Facility Management Process with an Emphasis on Implementing Management Practices that Develop a Long-Term Approach in Support of the Educational Process for the Success of the Campus and the Community. Policy and Leadership Integration of the Learning Experience & Campus Management Integration of the Learning Experience & Campus Management A Strategic Approach to Integrated Planning A Strategic Approach to Integrated Planning Sustainability & Total Cost of Ownership

9. Environmental Sustainability: A Conscious Consideration and Strategy to Minimize the Initial and Long-Term Impacts on Natural Resources Through all Elements of a Facilities Design and Operation. Sustainability & Total Cost of Ownership Commitment to Use of Environmentally Neutral Processes and Materials in ConstructionCommitment to Use of Environmentally Neutral Processes and Materials in Construction Commitment to the Development of Polices Involving Environmentally Responsive StrategiesCommitment to the Development of Polices Involving Environmentally Responsive Strategies

10. Operational Sustainability: An Understanding of the Operational Efficiencies, Impacts on Facility Stakeholders (Faculty, Students & Staff), Ability of the Organization to Sustain and Maintain the Investment or Initiative Throughout the Projected Service Life of the Facility or Complex. Key Components Include: An Understanding of the Operational Efficiencies, Impacts on Facility Stakeholders (Faculty, Students & Staff), Ability of the Organization to Sustain and Maintain the Investment or Initiative Throughout the Projected Service Life of the Facility or Complex. Key Components Include: Formalized Asset Management PlanFormalized Asset Management Plan Trained, Adequate Staff & FundingTrained, Adequate Staff & Funding Balanced Portfolio of In House and Contracted ServicesBalanced Portfolio of In House and Contracted Services Sustainability & Total Cost of Ownership

11. These 5 Components Are Inherently Linked…

12. OPERATIONS MISSION ECONOMIC SOCIAL ENVIRONMENT LIVABLE EQUITABLE COMPATABLE VIABLE SUSTAINABLE AFFORDABLE Sustainability & Total Cost of Ownership

13. Formalizing TCoO Balanced Sustainability (Policy) Relational Investments (Fiscal Management) Capital Asset Acquisition Program (Process) Annual Life Cycle Analysis Modeling (Assessment) Asset Management (Operational)

14. Relational Investments Principles of Relational Investment Dictate that Operating Cost be Linked to Capital Investment. Sustainability & Total Cost of Ownership

15. What Are Relational Investments Relational Investments Include Capital Projects, Maintenance & Operations and Associated Staffing and Material Cost. Specific Components Include: Design & Construction Routine, Deferred & Preventive Maintenance Routine, Deferred & Preventive Maintenance Utilities Utilities Materials & Equipment Materials & Equipment Sustainability & Total Cost of Ownership

16. Categories of Relational Investments Sustainability & Total Cost of Ownership

17. HYPERLINK Sustainability & Total Cost of Ownership

18. HYPERLINK

19. When Should Total Cost of Ownership be Implemented? As Early As Possible Become Part of the Overall Capital Planning Program Implementation of the Total Cost of Ownership Process MUST Begin at the Policy Making Level Sustainability & Total Cost of Ownership

20. Simply Put, Without the Support of Senior Management and Most Importantly, the VP for Finance and Accounting or CFO, it is Difficult to Establish a Mandate to Incorporate the Requirement as Part of the Daily Management Process Sustainability & Total Cost of Ownership Who Needs to Support This Effort?

21. Failure to Adequately Establish an Asset Management Program, Budget for Operations, Maintenance and Renewal of Capital Assets Jeopardizes Realization of Full Investment Value, Accelerates Cost of Ownership and Increases Deferred Maintenance Resulting in Devalued Assets. This Condition Impacts Cash Flow, Bond Ratings and Cash Reserves or Profits. Sustainability & Total Cost of Ownership Impacts?

22. COST TIME 30 Performance With Capital Renewal $10,000,000 Facility Million 100 50 10 015 Plan Design Construct Cost (25%) Operating Cost (75%) 45 Years Performance Without Capital Renewal  75 percent of the cost of ownership occurs AFTER design and construction  75 percent of the decisions that drive cost of ownership occur BEFORE design Lost Capital Investment Accelerated Capital Investment $$$ Sustainability & Total Cost of Ownership

23. Cross-Training and Staff Exchange of Design and Operations and Maintenance Management PersonnelCross-Training and Staff Exchange of Design and Operations and Maintenance Management Personnel Understanding of How Life Cycle Cost is Controlled at all Stages in the Facility's Service LifeUnderstanding of How Life Cycle Cost is Controlled at all Stages in the Facility's Service Life Maintain O&M Data and Design Decisions for Future Facility DesignMaintain O&M Data and Design Decisions for Future Facility Design Requirements Sustainability & Total Cost of Ownership

24. Assure Adequate Resources are Available to Implement Life-Cycle Cost Management DecisionsAssure Adequate Resources are Available to Implement Life-Cycle Cost Management Decisions Architects and Engineers Must Include Holistic Sustainability Goals in Their Design Criteria and ConsiderationsArchitects and Engineers Must Include Holistic Sustainability Goals in Their Design Criteria and Considerations Owner's MUST Consider the Long Term Economic Impacts of Their Short Term DecisionsOwner's MUST Consider the Long Term Economic Impacts of Their Short Term Decisions Requirements Sustainability & Total Cost of Ownership

25. Assuring that Value Engineering Programs and Construction Contract Incentives and Other Procurement Mechanisms Demonstrate Savings in Expected Life Cycle Rather than Construction Cost OnlyAssuring that Value Engineering Programs and Construction Contract Incentives and Other Procurement Mechanisms Demonstrate Savings in Expected Life Cycle Rather than Construction Cost Only Requirement for Architects and Engineers to Document Clearly Their Design Decisions Made to Control Life Cycle Cost and the Subsequently Expected Operating Consequences for Each FacilityRequirement for Architects and Engineers to Document Clearly Their Design Decisions Made to Control Life Cycle Cost and the Subsequently Expected Operating Consequences for Each Facility Requirements Sustainability & Total Cost of Ownership

26. Sustainability and Total Cost of Ownership Strategies for Higher Education