Asset management is the systematic process municipalities use to maintain, operate, and replace infrastructure in the most cost-effective way possible. It involves creating inventories of all municipal assets (roads, pipes, buildings, equipment), assessing their condition, projecting when they will need repair or replacement, estimating costs, and developing long-term funding strategies. Good asset management helps municipalities avoid surprise infrastructure failures, prioritize limited dollars effectively, and maintain services sustainably. Many provinces now require municipalities to develop asset management plans, recognizing that Canada faces significant 'infrastructure deficits' from years of deferred maintenance.