Dulles Corridor Metrorail Project: A Cost-Benefit Analysis, Lauren Donnelly, Policy Perspectives
Cost-Benefit Analysis of Transit Projects: Current Practice and ... · Dulles Rail Project 23-mile...
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Cost-Benefit Analysis of Transit Projects: Current Practice and
Methodological Advances
Elena Safirova
Presented at New York University
October 26, 2011
Outline What is Cost-Benefit Analysis? Benefits of Transit Transit Infrastructure CBA: State of Practice Transit Benefits: Potential Drawbacks FTA LUSTRE Project Project Goals LUSTRE Framework Work Description
Concluding Remarks
What is CBA?
A cost-benefit analysis is a systematic evaluation of the economic advantages (benefits) and disadvantages (costs) of a set of investment alternatives
A sum of discounted benefits is compared to a stream of discounted costs.
Benefit/cost ratio should be greater than 1 to justify the investment
Benefits of Transit (1)
Benefits to System’s Users Travel time reduction Travel cost reduction
Non-user Benefits Congestion reduction
Social Benefits Related to overall VMT reduction Environmental Benefits Accident Reductions
Benefits of Transit (2)
Benefits to vulnerable populations Significant reductions in costs to individuals Reduction in agency costs (e.g. paratransit)
Benefits of Transit-Oriented Development (TOD) Changes in travel patterns Changes in lifestyle (e.g. health benefits) Increase in land values
Costs of Transit Projects Not significantly different from other
infrastructure projects Cost escalation due to project delay and
initial cost underestimation Solution: cost management in a risk-
analytic framework
Transit CBA in Practice: Menu of Programs
FTA: New Starts DOT: TIGER I TIGER II TIGER III
State and MPO-level programs
Transit CBA: Methodology
Usually: a collection of disjoint categories of benefits
Inclusion of a particular benefit is largely data-driven
Due to the fragmentary approach, positive changes in benefits may be included while negative are omitted
Common Drawbacks of Practical Approach
High probability of double-counting E.g. travel-related benefits an TOD-related
benefits High probability of omitting large
categories of benefits Fragmentary nature of accounting Inconsistencies between benefit categories
Benefits of Travel and TOD
TOD and travel are interconnected TOD affects the demand for travel TOD changes spatial distribution of economic
activity in the entire region, and, as a result, changes the demand for travel
However, travel-related benefits are projected using regional travel demand model, and TOD benefits are estimated separately using different methods
FTA LUSTRE Project
Objectives Develop “proof of a concept” framework that
demonstrates a relationship between transportation and “environment benefits” of transit projects
Investigate the ratio of transportation and “environment benefits”
Advance evaluation methodology of transit projects
November 11
Land Use, Strategic Transport, Regional Economy (LUSTRE)
Literature Review Spatially Distributed Households Spatially Disaggregated Transportation Industry Modeling General Equilibrium Effects
LUSTRE Overview LUSTRE=START+RELU
Data and Calibration
November 11
Washington-START Model
Transportation simulation model Developed by RFF researchers using
START modeling suite Designed for quick policy analysis Evaluation of policies using a consistent
economic framework Not politically constrained Calibrated for Washington, DC metro area
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RELU Model Features
Spatially disaggregated general equilibrium model of economic activity without predetermined location of residents and firms
Some extras 4 income classes Employed and unemployed Explicit modeling of housing Developers’ and landlords’ decisions Income and property taxes
LUSTRE Model Overview Generalized Costs of Travel *Intermediate demand for finished goods and services, also referred as Input/Output (I/O) tables.
START
RELU
Generalized Costs of Travel
Wages & Trips
LUSTRE
Supply-Side Module
Route Network Rail Systems Bus System
Parking Facilities
Demand-Side Module
Logit Tree: Purpose/Origin (given)
Trip Generation
Destination
Mode
Time
Route
GCT Trips
Individuals Discrete Choices:
Choice of Work Status Choice of Work Location
Choice of Residence
Continuous Choices: Housing Consumption
Retail Goods & Services
Producers
Retail Agriculture
Manufacturing Business Services
Constr/Demo
Labor
Capital Space
I/O*
LandlordsDevelopers
Real Estate
Stock
Rent
Rent
Rent
I/O Freight
Labor Supply/ Wage
Price
November 11
LUSTRE features
Consistent spatial disaggregation Non-monocentricity Agent heterogeneity Unemployment Frictions Income and real estate taxes Congestible alternative modes
November 11
Data Sources
2000 Census SF1A & SF3A CTPP
BEA production data Consumer Expenditure Survey MWCOG transportation data Land use data
November 11
Wage and Income Information for LUSTRE Baseline
*Net of taxes and commuting costs
Average Net Income*
(2000$/year)
Average Gross Wages Rates (2000$/hour)
Income Tax Rates
…………………..Quartile 1 15779 6.8 14.3%
Quartile 2 25815 14.1 16.6%
Quartile 3 43943 22.5 22.3%
Quartile 4 91805 47.0 31.5%
November 11
Active Population Employed
1480873 830601(56.1%)
941310 738659(78.5%)
1244120 1144755(92.0%)
472832 461014(97.5%)
4139134 3175031(76.7%)
Quartile 3 (relative to active population)Quartile 4 (relative to active population)Total (relative to active population)
All Study Area
Quartile 1 (relative
to active population)Quartile 2 (relative
to active population)
Workers from All ZonesActive Population Employed Total per year
25265 13402 70323(53.0%)
14083 10528 85331(74.8%)
16139 14317 183792(88.7%)
7388 7152 104990(96.8%)
62874 45402 444437(72.2%)
Downtown CoreResidents
Quartile 1 (relative
to active population)Quartile 2 (relative
to active population)Quartile 3 (relative
to active population)Quartile 4 (relative
to active population)Total (relative to active population)
Population Distribution Over the Region
Population Distribution for the Downtown Core
November 11
Commuting Trips
(Thousands/Day)
Shopping Trips
(Thousands/Day)
All Trips
(Thousands
/Day)
Commuting Trips
(Thousands/Day)
Shopping Trips
(Thousands/Day)
All Trips
(Thousands
/Day)AM Peak 1454 321 1775 226 11 238PMPeak 60 883 943 6 24 30Off Peak 908 1090 1998 108 31 139
Total 2423 2294 4716 341 66 407
All Study Area Ending at Downtown Core
AM Peak : From 6:30 am to 9:30 amPM Peak : From 3:30 pm to 6:30 pm
Commuting Trips
(Thousands/Day)
Shopping Trips
(Thousands/Day)
All Trips
(Thousands
/Day)
Commuting Trips
(Thousands/Day)
Shopping Trips
(Thousands/Day)
All Trips
(Thousands
/Day)Bus 86 32 118 29 15 45
Rail 234 13 246 163 7 169
SOV 1641 997 2638 91 10 101
HOV 291 1109 1401 40 14 54
Walking / Biking
171 142 313 18 21 39
HOV : High Occupancy Vehicle
All Study Area Ending at Downtown Core
SOV : Single Occupancy Vehicle
Distribution over Time Periods
Distribution over Mode of Transportation
Trips Distribution for LUSTRE Baseline
November 11
Modeling area
Dulles Rail Project
23-mile extension of the existing Metrorail system
Will connect Downtown Washington DC with Dulles International Airport and surrounding area
The project will include 11 new stations
Zoom-in Tool
Zoom-in Land Use Module Zoom-in Transportation Module Approaches: “Little LUSTRE” “Little RELU” + Simplified transportation
module (STM) “Simplified RELU”+ “Little START” “Simplified RELU” + Simplified
transportation module (STM)
Simplified Transportation Module
3 suggested versions “Start Lite” Simple mode choice model Likely a Logit based mode choice, with a very
simple route structure. (No parking search, etc)
Econometric model We can calibrate this model by using START
model runs
Simplified RELU
Several features could be suppressed/simplified: Shopping modeling Features of “Closed Economy” Modified developers module
Goal: to retain consistency in welfare measurement while capturing key land use metrics
Integration between “Big LUSTRE” and zoom-in tool
Complete Integration (iteration until convergence on several aggregate parameters, e.g. residents, jobs, etc., trip times)
Partial integration Focusing on population movements and
transportation cost equivalency Post-processing (loose connection)
Assumed Unchanged
Big LUSTRE Calibration Area Population Initial Building Stocks Transportation Infrastructure Except for the Dulles rail project
Initial Income Levels Big LUSTRE Structure Long-term equilibrium framework
Resulting framework capabilities
Consistent (or largely consistent) welfare measurement
Account of population and job movement Changes in travel patterns in response to
infrastructure improvement/construction Changes in wages, rents, incomes, etc.
Mini-RELU Design
Focus on developers’ decisions New development Redevelopment
Focus on relocation of residents and businesses within the localized area
Don’t explicitly model variation in prices and wages in the zoom-in area
Mini-LUSTRE Data Work
Define zone structure Consistent with project goals Consistent with data availability
Obtain Data RELU data (population, housing, land use,
economic fundamentals) Transportation data
Calibrate the model
Zone # Description County Tracts
1 Tysons Fairfax 4802.02, 4802.03, 4605.01, 4604
2 Tysons East Fairfax 4712.01, 4712.02
3 Reston North Fairfax 4820.01, 4820.02, 4805.04, 4805.05, 4821, 4822.01, 4822.02, 4822.03, 4819
4 Reston South Fairfax 4812.01, 4812.02, 4823.01, 4823.02, 4823.03, 4814
5 Herndon North Fairfax 4808.01, 4808.02, 4809.01, 4809.02, 4809.03, 4810
6 Herndon South Fairfax 4811.01, 4811.02, 4811.03, 4811.04, 4825.01
7Sterling/Dulles Town Center Loudoun 6115.01, 6115.02, 6116.01, 6116.02, 6113, 6114, 6117
8 Ashburn Loudoun 6110.04, 6110.05, 6110.06, 6110.19, 6110.20, 6110.21, 6110.22, 6110.23,6110.24, 6110.25
910
CascadesBelmont/Landsdowne
LoudounLoudoun 6111, 6112
6110.02, 6110.09-6110.186105, 610611 Leesburg Loudoun
12 Dulles Airport Fairfax, Loudoun 9802, 9801
13 Great Falls Fairfax 4801, 4804
14 Northeast Fairfax Fairfax 4803, 4802.01
15 Dunn Loring Fairfax 4605.02, 4606
16 Vienna North Fairfax 4608, 4609
17 Vienna South Fairfax 4607.01, 4607.02, 4610
18 South of 66 Fairfax 4616.01, 4616.02, 4617, 4402.01
19 Woodburn Fairfax 4401, 4402.02, 4403
20 City of Fairfax Fairfax C of F + 4405.02+ 4405.01+ 4406
21 North of Oakton Fairfax 4611, 4615, 4612.01, 4618, 4619
22 Wolf Trap Fairfax 4602, 4603, 4824
23 Fairfax Northwest Fairfax 4805.01, 4805.02, 4805.03
24 East of Franklin Farm Fairfax 4815, 4816, 4817.01, 4817.02
25 Fair Oaks/Fair Lakes Fairfax 4612.02, 4917.01, 4917.02, 4917.03, 4917.04, 4918.01, 4918.02, 4918.03
26 Loudon/Prince William Fairfax 4910, 4911.01, 4911.02, 4911.03, 4912.01, 4912.02, 4915.01, 4915.02
27 Chantilly Fairfax 4826.01, 4901.01, 4901.03, 4916.01, 4916.02
28 Arcola/Stone Ridge Loudoun 6118.01, 6118.02, 6118.03, 6118.04, 6118.05, 6118.06
Table 2a: Average Weighted Travel Time Difference (Build - Baseline): Peak Walk to Transit
PKWKWTD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
1-DC Core 0 0 0 0 0 0 0 -37 -15 -68 -3 1 0 0 0 0
2-DC Other 0 0 0 0 0 0 0 -34 -15 -64 -5 1 0 0 0 0
3-VA Core 0 0 0 0 0 0 0 -35 -15 -66 -2 1 0 0 0 0
4-VA Arlington Orange Line 0 0 0 0 0 0 0 -32 -13 -63 0 1 -1 0 0 0
5-VA ARL Columbia Pike 0 0 0 0 0 0 0 -30 -12 -56 0 1 0 0 0 0
6-Alexandria/Springfield 0 0 0 0 0 0 0 -11 -17 -58 -9 0 0 0 0 0
7-Vienna Corr 0 0 0 0 0 0 0 -13 -6 -40 -3 0 0 0 0 0
8-Tysons -30 -27 -28 -22 -21 -17 -15 -11 -31 -94 -30 -12 -7 -29 -17 -26
9-Dulles Corr -14 -14 -12 -11 -10 -12 -5 -32 -18 -60 -6 -3 -15 -17 -4 -22
10-Ashburn/Sterling -34 -38 -35 -42 -37 -26 -27 -79 -45 -5 0 -9 -38 -33 -48
11-Rest of Loudoun -1 -2 -1 -14 -7 -5 -22 -62 -46 -8 0 -6 -8 -3 -4
12-PW County 0 0 0 0 0 0 0 -6 -12 -53 -12 0 0 0 0 0
13-MTG County 0 0 0 0 0 0 0 -14 -16 -60 -10 1 0 0 0 0
14-PG County 0 0 0 0 0 0 0 -38 -18 -57 -10 0 0 0 0 0
15-Outer VA 0 0 0 -1 0 0 1 -1 -24 -85 -36 0 0 0 0 0
16-Outer MD 0 0 0 0 0 0 0 -33 -19 -56 -11 0 0 0 0 0
Table 2b: Average Weighted Travel Time Difference (Build - Baseline): Peak Drive to Transit
PKDRWTD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
1-DC Core 0 0 0 0 0 0 0 -59 -28 -70 -6 1 0 0 0
2-DC Other 0 0 0 0 0 0 0 -44 -19 -61 -5 1 0 0 0 0
3-VA Core 0 0 0 0 0 0 0 -36 -15 -53 -5 0 0 0 0
4-VA Arlington Orange Line 0 0 0 0 0 0 0 -43 -16 -64 0 1 -1 0 0
5-VA ARL Columbia Pike 0 0 0 0 0 0 0 -42 -17 -58 -2 1 0 0 0
6-Alexandria/Springfield 0 0 0 0 0 0 0 -23 -18 -58 -9 0 0 0 0 0
7-Vienna Corr 0 -1 0 0 0 0 0 -31 -13 -48 -3 0 -2 -1 0 0
8-Tysons 1 1 1 1 2 1 0 0 -1 -47 -1 0 1 1 2
9-Dulles Corr -11 -12 -7 -10 -8 -9 -6 -43 -16 -62 -5 -3 -17 -14 0 -11
10-Ashburn/Sterling -32 -35 -30 -47 -35 -34 -46 -108 -78 -22 -3 -25 -43 -37 -31
11-Rest of Loudoun -18 -21 -18 -34 -24 -21 -47 -102 -92 -25 -3 -25 -28 -25 0 -15
12-PW County 0 0 -1 -4 0 0 -3 -39 -30 -72 -22 0 0 0 0 0
13-MTG County 0 0 0 0 0 0 -1 -24 -21 -65 -12 0 0 0 0 0
14-PG County 0 0 0 0 0 0 0 -43 -20 -60 -10 0 0 0 0 0
15-Outer VA 0 0 0 0 0 0 0 -24 -20 -77 -27 0 0 0 0 0
16-Outer MD 0 0 0 0 0 0 0 -42 -21 -57 -11 0 0 0 0 0
Zone # Description County Tracts
1 Tysons Fairfax 4802.02, 4802.03, 4605.01, 4604
2 Tysons East Fairfax 4712.01, 4712.02
3 Reston North Fairfax 4820.01, 4820.02, 4805.04, 4805.05, 4821, 4822.01, 4822.02, 4822.03, 4819
4 Reston South Fairfax 4812.01, 4812.02, 4823.01, 4823.02, 4823.03, 4814
5 Herndon North Fairfax 4808.01, 4808.02, 4809.01, 4809.02, 4809.03, 4810
6 Herndon South Fairfax 4811.01, 4811.02, 4811.03, 4811.04, 4825.01
7Sterling/Dulles Town Center Loudoun 6115.01, 6115.02, 6116.01, 6116.02, 6113, 6114, 6117
8 Ashburn Loudoun 6110.04, 6110.05, 6110.06, 6110.19, 6110.20, 6110.21, 6110.22, 6110.23,6110.24, 6110.25
910
CascadesBelmont/Landsdowne
LoudounLoudoun 6111, 6112
6110.02, 6110.09-6110.186105, 610611 Leesburg Loudoun
12 Dulles Airport Fairfax, Loudoun 9802, 9801
13 Great Falls Fairfax 4801, 4804
14 Northeast Fairfax Fairfax 4803, 4802.01
15 Dunn Loring Fairfax 4605.02, 4606
16 Vienna North Fairfax 4608, 4609
17 Vienna South Fairfax 4607.01, 4607.02, 4610
18 South of 66 Fairfax 4616.01, 4616.02, 4617, 4402.01
19 Woodburn Fairfax 4401, 4402.02, 4403
20 City of Fairfax Fairfax C of F + 4405.02+ 4405.01+ 4406
21 North of Oakton Fairfax 4611, 4615, 4612.01, 4618, 4619
22 Wolf Trap Fairfax 4602, 4603, 4824
23 Fairfax Northwest Fairfax 4805.01, 4805.02, 4805.03
24 East of Franklin Farm Fairfax 4815, 4816, 4817.01, 4817.02
25 Fair Oaks/Fair Lakes Fairfax 4612.02, 4917.01, 4917.02, 4917.03, 4917.04, 4918.01, 4918.02, 4918.03
26 Loudon/Prince William Fairfax 4910, 4911.01, 4911.02, 4911.03, 4912.01, 4912.02, 4915.01, 4915.02
27 Chantilly Fairfax 4826.01, 4901.01, 4901.03, 4916.01, 4916.02
28 Arcola/Stone Ridge Loudoun 6118.01, 6118.02, 6118.03, 6118.04, 6118.05, 6118.06
0 200 400 600 800 1000 1200 1400
Change in number of Residents
1
5
9
13
17
21
25
Zone
#
Long-Term Growth in Residents
0 200000 400000 600000 800000 1000000 1200000
Floor Space
1
6
11
16
21
26
Zone
#
Long-term Change in Single Family Housing
0 20000 40000 60000 80000 100000 120000 140000 160000
Floor Space
1
5
9
13
17
21
25
Zone
#Long-term Change in Multi Family Housing
0 200000 400000 600000 800000 10000001200000140000016000001800000
Floor Space
1
5
9
13
17
21
25
Zone
#
Long-Term Change in Commercial Building Space
Mini-LUSTRE Summary
Residential Growth: 10,791 (3.1%) Single Family Housing Growth: 8,300,000
sq. ft. (2.35%) Multi-Family Housing Growth: 876,000 sq.
ft. (2.31%) Commercial Building Floor Space Growth:
10,355,000 sq.ft. (1.73%)
Residential Movement in "Big" LUSTRE
-0.04
-0.03
-0.02
-0.01
0
0.01
0.02
0.03
0.04
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39
Zone #
Cha
nge
Caveats
Model is calibrated on 2000 data 2000 Census No new infrastructure included (e.g. ICC)
No natural population growth, economic growth, technological progress, etc.
The outcome is “static” long-term equilibrium
Only marginal effects are displayed; policy interactions are ignored
Concluding Remarks
There is a wide gap between theory and practice of evaluating benefits of transit investments
Various categories of benefits are interconnected and should not be estimated separately from disconnected sources
Improvements in accuracy of demand estimates is likely to lead to more accurate CBAs in general