THE APPLICATION OF BENEFIT-COST RATIOS TO AN EXPRESSWAY SYSTEM

BENEFIT-COST RATIOS HAVE MOST OFTEN BEEN USED TO DETERMINE WHICH IS THE BEST CHOICE OF SEVERAL LOCATIONS OR DESIGNS FOR A SINGLE HIGHWAY IMPROVEMENT. TWO OTHER USES OF BENEFIT-COST RATIOS HAVE OFTEN BEEN NEGLECTED: FIRST, TO HELP DETERMINE THE FISCAL FEASIBILITY OF CONSTRUCTING A NETWORK OF EXPRESSWAYS FOR A METROPOLITAN AREA AND, SECOND, TO DETERMINE CONSTRUCTION PRIORITIES FOR PARTS OF THE EXPRESSWAY NETWORK. THE BENEFIT-COST RATIO IS DEFINED AS THE RATIO OF THE AVERAGE ANNUAL BENEFITS ACCRUING TO FUTURE USERS OF THE EXPRESSWAY TO THE DISCOUNTED ANNUAL COST OF BUILDING AND MAINTAINING THE EXPRESSWAY. THE METHOD FOR CALCULATING THESE RATIOS MAY BE SUMMARIZED AS FOLLOWS: AN APPROPRIATE TIME PERIOD MUST BE DETERMINED OVER WHICH THE INVESTMENT IN THE EXPRESSWAY SYSTEM IS TO BE AMORTIZED. FOR THE DETROIT AREA, THIS WAS ASSUMED TO BE 25 YEARS, WHICH IS THE AMORTIZATION PERIOD UNDER THE MICHIGAN REVENUE BOND PLAN. ZONE-TO-ZONE INTERCHANGE VOLUMES ARE FORECASTED TO AN INTERMEDIATE POINT THAT REPRESENTS AN AVERAGE OF TRAFFIC VOLUMES THROUGHOUT THE ENTIRE 25-YEAR PERIOD. THE ZONAL INTERCHANGE VOLUMES ARE ASSIGNED TO AN EXPRESSWAY NETWORK. CALCULATIONS ARE MADE FOR EACH SECTION OF THE NETWORK OF THE VEHICLE MILES OF TRAVEL ON THE EXPRESSWAY AND OF THE VEHICLE MILES OF TRAVEL ON ALTERNATE FACILITIES FOR WHICH EXPRESSWAY TRAVEL IS BEING SUBSTITUTED. APPROPRIATE UNIT COSTS PER MILE ARE APPLIED TO THE ESTIMATED VEHICLE MILES OF TRAVEL TO OBTAIN AN ESTIMATE OF TOTAL USER COSTS ON THE EXPRESSWAY AND WHAT THESE COSTS WOULD HAVE BEEN ON AN ALTERNATE FACILITY. BENEFITS ACCRUING TO EXPRESSWAY USERS ARE THEN EQUAL TO WHAT THE USER COSTS ARE ON AN ALTERNATE FACILITY LESS WHAT THESE COSTS ARE ON THE EXPRESSWAY. FINALLY, KNOWING THE DISCOUNTED ANNUAL COST OF BUILDING AND MAINTAINING THE EXPRESSWAY, THE BENEFIT-COST RATIO CAN BE CALCULATED. RESEARCH SHOWS THAT UNIT COSTS PER MILE FOR TRAVEL ON SURFACE STREETS VARY GREATLY BETWEEN DOWNTOWN AND SUBURBAN AREAS WHILE COSTS OF USING AN EXPRESSWAY REMAIN QUITE CONSTANT. THUS THE BENEFITS ACCRUING TO EXPRESSWAY USERS WILL VARY GREATLY ACCORDING TO THE TYPE OF AREA THROUGH WHICH THE TRIP IS BEING MADE. THIS IS A RESULT OF THE AMOUNT OF CONGESTION ENCOUNTERED, THE AVERAGE SPEED, NUMBER OF STOPS, AND SO ON. AREAS FOR FUTURE RESEARCH ARE POINTED OUT, SUCH AS THE NEED FOR MORE PRECISE MEASURES OF THE EFFECT OF TRAFFIC CONGESTION ON OPERATING COSTS AND THE NEED TO INCLUDE ALL POSSIBLE BENEFITS AND COSTS BEFORE THE BENEFIT-COST TECHNIQUE CAN BE A CONCLUSIVE TOOL. AMONG THE LATTER ARE CONSIDERATIONS OF THE EFFECT OF EXPRESSWAY LOCATIONS ON REAL ESTATE VALUES AND RETAIL TRADE. /AUTHOR/

  • Supplemental Notes:
    • Vol 35, pp 63 - 75, 7 FIG, 4 TAB, 6 REF
  • Authors:
    • Bevis, H W
  • Publication Date: 1956

Media Info

  • Monograph Title: Proceedings of the Thirty-Fifth Annual Meeting of the Highway Research Board, Washington, D.C., January 17-20, 1956
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 00201979
  • Record Type: Publication
  • Files: TRIS, TRB
  • Created Date: Aug 8 1971 12:00AM