Benefit-Cost Analysis Framework for Evaluating Inter-City Transit Investment

Available Documents
Quarterly Report June 2007
Quarterly Report September 2007
Quarterly Report December 2007
Quarterly Report March 2008
Quarterly Report June 2008
Quarterly Report September 2008
Final Report

Primary Investigator|
Jessica Guo
University of Wisconsin-Madison
1206 Engineering Hall
1415 Engineering Drive
Madison, WI 53706
jyguo[at]engr.wisc.edu

Project Objective

  1. To identify the benefit and cost considerations most relevant to the evaluation of intercity bus services, and the methods by which these considerations can be measured and quantified.
  2. To identify the data requirements for calculating the desired benefit and cost measures and the data availability for performing such calculations for Wisconsin.
  3. To develop an Excel-based model that serves as a comprehensive analysis framework specifically for evaluating proposed intercity bus investments against selected benefit and cost measures. The model will be reusable over time and the Excel platform will help ensure that the proposed model is user friendly.

Project Abstract
Since the passing of the Bus Regulatory Reform Act (BRRA) of 1982, intercity bus service has been declining with operators abandoning money-losing routes. Over 18% of communities throughout the nation lost servie in the first year. Personal, economic, and sociological impacts of service abandonment and particularly severe in rural areas with no alternative public transportation and on those groups of people who frequently use intercity bus service: students, retirees, and low income people. In order to improve the statewide network connectivity and to address the various issues that have arisen from intercity bus service cutbacks, WisDOT is looking to restore, improve, and expand existing bus routes as part of its Connections 2030 long range transportation plan.

As with any transportation investments, the planning of an effective intercity bus system requires proper evaluation of the fundamental merits of possible investments. The limited public funds available for intercity bus service investment means that planning agencies need to be able to defend and to get the most out of potential service additions or changes. This in turn call for a comprehensive benefit-cost analysis framework to properly identify and quantify the benefits and costs associated with alternative intercity transit service scenarios.

To be sure, many reports and studies to-date have been written about the benefit-cost analysis of transportation investments. However, conventional transport evaluation models tend to focus on a limited set of investment impacts in an urban setting. As a result, many past evaluations of transit investments focus on ridership benefits and operating costs, leaving other important economic, environmental, and societal benefits and costs unaccounted for. The omission of these benefits and costs often leads to the under evaluation of public transit. As most of the past studies are concerned with either transit service in general or urban transit services in particular, their findings and recommendations are not necessarily applicable to the evaluation of intercity bus routes. The proposed research will therefore focus on the benefit-cost analysis of intercity bus service.

Task Descriptions

  1. Synthesize existing literature on the evaluation of intercity transit systems.
  2. Review SPASM, STEAM, TCRP 78, and other relevant studies and tools for benefit-cost analysis.
  3. Identify a list of, and the corresponding measures for, benefit and cost impacts most relevant to the evaluation of intercity bus investments based on the findings from tasks 1 and 2.
  4. Identify the data items required for calculating the measures identified in task 3 and acquire these data items for selected intercity bus corridors in Wisconsin.
  5. Develop an Excel-based spreadsheet model that incorporates the measures identified in task 3.
  6. Apply the proposed model to the test corridors and assess applicability.
  7. Prepare a final report and a guidebook for benefit cost analysis using the proposed model.
  8. Conduct a workshop for WisDOT staff on the use of the proposed model.

Project Information

  • Milestones, Dates: 14 months; March 1, 2007– April 30, 2008
  • Budget: $59,581
  • Student Involvement: One graduate student
  • Modal Orientation: Transit
  • Project ID: 08-03