Return on Investment in Transportation Asset Management Systems and Practices (2018) / Chapter Skim
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Pages 157-166
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From page 157... ...
157 A P P E N D I X F Pilot of ROI Guidance and ROI Calculation Tool (ROI Tool) Context A New England state agency was chosen for the pilot based on the fact that the agency indicated an interest in participating in the pilot, was considering multiple investments to improve its asset management systems and processes, and appeared to have the data required to support the testing.
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158 Return on Investment in Transportation Asset Management Systems and Practices Step 4: Establish Modeling Approach and Identify Tools. Define the investment case and the base case, establish which benefits to include in the analysis, choose an analytical method for quantifying impacts, and establish key modeling parameters.
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Appendix F 159 Figure F-1. Inputs Worksheet.
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160 Return on Investment in Transportation Asset Management Systems and Practices Figure F-2. General Parameters.
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Appendix F 161 Figure F-3. Incident Cost Model.
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162 Return on Investment in Transportation Asset Management Systems and Practices The costs of the investment case are shown below in Figure F-5. The initial cost of acquiring a culvert inventory and data collection system in the investment case is estimated to be $50,000.
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Appendix F 163 In sum, the present value of the total cost to install and operate a culvert data collection and inventory system is estimated to be $3,279,272. TAM Investment Effects The second step in calculating the ROI of the potential TAM investment was estimating the effects of the TAM investment in the investment case.
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164 Return on Investment in Transportation Asset Management Systems and Practices value of agency benefits resulting from a culvert data collection and inventory system is estimated to be $5,584,808. The reduction in failure incidents also reduces user costs such as travel-time cost caused by traffic; vehicle operating costs; and fatality, injury, and property damage costs.
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Appendix F 165 The tool summarizes the results in four measures of return on investment. These measures and the breakdown of total costs and benefits are shown below in Figure F-8.
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166 Return on Investment in Transportation Asset Management Systems and Practices labor costs, or incident costs vary from the estimates, the results of the analysis may be affected. The analysis assumes a linear decline in culvert failure incidents, paralleling the development of the culvert inventory and inspection system.
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