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Highway Costs

Highway Costs. Spring 2014. Highway Transportation Costs. HIGHWAY USER COSTS. Value of Time. Direct Crash Costs (per person). * $7.00 per single-unit trucks, $8.00 for combination trucks (include wage and benefits for drivers). Comprehensive Crash Costs (per person).

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Highway Costs

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  1. Highway Costs Spring 2014

  2. Highway Transportation Costs

  3. HIGHWAY USER COSTS Value of Time Direct Crash Costs (per person) * $7.00 per single-unit trucks, $8.00 for combination trucks (include wage and benefits for drivers)

  4. Comprehensive Crash Costs (per person) http://www.nsc.org/news_resources/injury_and_death_statistics/Pages/EstimatingtheCostsofUnintentionalInjuries.aspx

  5. USER BENEFITS Unit highway user cost: Where, HU = Highway user costs in dollars per 1,000 vehicles B = basic section costs (travel time, vehicle running costs as a function of highway geometric characteristics) A = Crash costs L = length of section T = Transition section costs due to change in speed between adjacent sections D = additional costs caused by delay at intersections

  6. USER BENEFITS User Benefits (between two alternatives): Induced and Diverted Traffic (may need to take average traffic volumes between alternatives): Where, U0= user cost per unit of traffic without the improvement U1 = user cost per unit of traffic with the improvement V0 = traffic volume without the improvement V1 = traffic volume with the improvement

  7. Basic Section Costs (B) Wright & Dixon (2004) Figure 4-1

  8. Section Transition Costs (T) Wright & Dixon (2004) Figure 4-2

  9. Intersection Related Costs (D) Wright & Dixon (2004) Figure 4-3

  10. Intersection Related Costs – Idling (D) Wright & Dixon (2004) Figure 4-4

  11. Important Economic Equations Present Value of some future single payment: Present Value of a series of uniform annual end payment: Present Value Factor when user benefits change from year to year: r = average growth rate, = future annual value estimate/first year value, Y = number of years between estimates

  12. Benefit-Cost Ratio Where, PV = Present value ΔU = user benefits, the reductions in highway costs ΔM = increase in annual maintenance, operating and administrative cost due to investment ΔR = increase in residual value due to the project at the end of the project life ΔI = increase in investment costs due to the project

  13. EXAMPLE A highway agency is considering eliminating an S-Sharp curve on a multilane highway. The total construction cost for the improvement is estimated to be $2 million and will be incurred at the inception of the project. Annual maintenance costs are anticipated to be $2,000 less after the improvement because the elimination of the curve reduces pavement and guardrail damage. The characteristics of the proposed alternatives:

  14. Key Assumptions • Two curves have same geometry: can be analyzed together • There is no speed differential for passing one curve to the other • The design speed increases from 50 mph to 60 mph for the alternative design (#1) • One-way hourly volume is equal to the ADT divided by 18 (the number of hours used for the analysis) • The capacity is reduced in year 20 to reflect normal deterioration of the roadway

  15. TRAFFIC DATA

  16. CALCULATION OF USER COSTS

  17. Basic Section Costs – Alternative 0 Year 1 3 27.8 71 20 B = 3 + 71 + 20 + (27.8 x $3/hour) = $177.4

  18. CALCULATION OF USER BENEFITS Assuming a 25-year analysis period and a 4-percent discount rate, the present value of benefits is then PWg x first year of project: 18.7 x $172,827 = $3,231,865 For two-way traffic: 2 x $3.231,865 = $6,463,730 Note:

  19. CALCULATION OF PROJECT-RELATED COSTS NET PRESENT VALUE OF PROJECT NPV = $6,463,730 – $1,718,198 NPV = $4,745,532 BENEFIT-COST RATIO B/C = $6,463,730 / $1,718,19 NPV = 3.62 > 1

  20. UPDATING USER COSTS Wright & Dixon (2004) Table 4-9

  21. UPDATING USER COSTS Wright & Dixon (2004) Table 4-10

  22. UPDATING USER COSTS Wright & Dixon (2004) Example 4-6

  23. Construction Unit Costs Some useful websites: http://www.fao.org/docrep/T0579E/t0579e06.htm http://www.dot.state.tx.us/insdtdot/orgchart/cmd/cserve /bidprice/s_0101.htm http://www.bookmarki.com/index.asp?PageAction =VIEWPROD&ProdID=45

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