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5 CONCLUSIONS AND RECOMMENDATIONS Importance of Segmentation. The concept of having a different value of time for different segments of a trip is far from new. For instance, public transportation planners have long recognized that transit riders place a premium on saving âout of vehicleâ travel time (associated with walking to and waiting at a bus stop), compared to the value of saving âin vehicleâ travel time (riding the bus). The application of similar segmentation is particularly useful for the complex airport experience, which has multiple distinct stages. By segmenting airline travel into component parts, it thus becomes possible to represent differences in comfort, amenity, work efficiency, passenger familiarity and travel time reliability that are associated with those different trip elements. The segmentation specifically makes it possible to represent the effects of implementing technology changes that affect the terminal access, check-in, security, gate access and gate waiting experiences of passengers. It also makes it possible to consider ways to optimize the user experience by recognizing that some segments of the traveler experience are more onerous than others. Uses of the Segmented User Benefit Methodology. This analysis approach has several distinct uses. It can help airport planning and design by recognizing and considering ways to optimize airport enhancement plans -- via changes that affect passenger throughput capacity, passenger quality of experience, reliability of processing times, and passenger movement within airport terminal buildings. It can also help prioritize project funding decisions by giving greater weight to projects that travelers value the most. And finally, it can help investment decision-making by more accurately representing user benefits within benefit-cost analysis calculations. One of the most important aspects of this approach is that it calls attention to airport terminal design and operational elements as important subjects for time analysis and benefit-cost calculations. To date, the majority of FAA Airport Improvement Program grant funds awarded focus on airside enhancements â particularly runway, airfield lighting, and navigation aid investments that enable greater airside capacity, use of larger aircraft, and faster and more reliable travel between cities. Airport terminal building enhancements may be funded in part or completely by state, local or independent agencies that own the facility, and hence may not be subject to the same level of benefit-cost analysis. Yet this guide shows that it is indeed possible and advantageous to consider air passenger airport terminal and ground access times as well as aircraft flight times, and thus measure the full air traveler experience, from ultimate origin to ultimate destination. Still, not every proposed airport improvement requires a detailed analysis of all trip elements experienced by passengers. Accordingly, the use of a screening process is important, as it allows the recommended methodology to be used only in cases where the effort to assemble and apply the necessary additional data is indeed worthwhile. 5 Page 42
Updating. Finally, it is important to note that the values of traveler time will change over time in response to changes in income levels. Just as wage rates change over time, so too will the âstated preferenceâ valuation of time savings for air travelers. These changes will reflect two interrelated effects. First, values of time expressed in current dollars will change reflecting the rate of inflation. However, expressing the values of time in constant dollars (i.e. correcting for inflation) will eliminate this effect. Secondly, to the extent that values of time are a function of the income level of the traveler, values of time expressed in constant dollars will change in response to changes in real incomes (i.e. incomes expressed in constant dollars). If real incomes rise, then the values of time in constant dollars will also rise. All of the currently recommended values of time (shown in Chapter 2, Tables 1 and 2) are expressed in 2013 dollars. To adjust these values for future changes in real incomes, they should be updated by the annual percent change in personal income, expressed in constant dollars. This can be approximated by using the median income for all US households (by state), as reported annually in the US Census Bureauâs âTable H-8.â This is the same source that is also used to update the values of time in the USDOT guidance on the value of time. Note that there are potentially three steps to update the values of time. The first is to adjust the values for any changes in real incomes between 2013 and the current year, expressed in constant 2013 dollars. The second step is to project the change in the values of time for each future year of the analysis period based on the expected future change in real incomes from the current year, still expressed in constant 2013 dollars. The third step (which may not be necessary) is to convert those values of time in 2013 dollars to constant dollars in some other year (e.g. constant 2015 dollars). This is done by simply multiplying the values of time by the actual or projected inflation (typically determined from the change in the Consumer Price Index) from 2013 to the year in question. Page 43
