Development of Tools for Assessing Wider Economic Benefits of Transportation (2014)

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3Project Overview An underlying theme throughout the second Strategic High- way Research Program (SHRP 2) has been the development of practical, useful, and “accessible” tools that can truly make a difference in transportation investment and planning. This study provides a set of four tools for transportation impact assessment that planners can use to assess the impacts of trans- portation capacity projects on conditions that directly affect wider economic benefits. These four tools enable measurement of project impacts on (1) travel time reliability, (2) intermodal connectivity, and (3) market access (often abbreviated as “reliability, connectivity, and access” in this report), and they are accompanied by (4) an accounting system or “framework” for incorporating the above three metrics into economic ben- efit and economic impact analyses. This report describes the four analytic tools and their technical foundation and provides instructions for users. The Microsoft Excel spreadsheet-based tools are freely available by accessing www.trb.org/main/blurbs/169524.aspx. A notable aspect of these tools is that they shift the focus of analysis from traditional transportation impact measures (i.e., travel time, cost, and safety) to broader factors that also matter to individual business operators and thus actually “drive” economic development processes (i.e., travel time reliability, intermodal connectivity, and market access). The accounting framework then shows how those factors can be drivers of economic development impact outcomes (reflecting rates of growth and location of economic activities). These tools are designed as a coordinated suite, though they can also be used individually by staff of state departments of transportation and metropolitan planning organizations. Each of the tools is designed to require only data that are easily collected or assembled by those conducting a sketch planning study, or that can be acquired from data sources that are widely available. They can also be used in conjunction with travel models, land use models, or economic models. Background: Relationship to SHRP 2 Program Application of Economic Analysis for Different Planning Stages To understand the role of these new tools, it is important to first note how an earlier SHRP 2 project (C01) broke down into detail the key decision points in transportation planning and decision-making processes. These various decision points differ in the stakeholder issues being considered and the information available to inform those decisions. At the most in-depth possible level, the key decision points can be grouped as follows: 1. Early Stage Planning typically involves a need for a “broad brush” scan of available options and the typical magnitude of economic impacts commonly associated with them and containing basic information about the local context (such as long-range transportation plans and area transportation needs studies). 2. Middle Stage Planning more typically requires further analysis to establish the range of likely outcomes through sketch planning procedures that consider not only local context but also expected changes in transportation condi- tions and access impacts (such as development of project lists in programming processes and initial elements of corridor planning). 3. Later Stage Planning typically calls for full, detailed model- ing and the analysis is conducted to refine estimates of expected impacts, given details of the project and forecasts of traffic and economic change (such as refinement of planning priorities, alternatives analysis, or environmental studies for large projects). Early Stage Planning issues are addressed by a previous SHRP 2 project (C03) that developed the T-PICS web tool. That tool is described in text that follows. Later Stage Planning C H a P t e R 1 Introduction

4can use existing transportation models, economic impact analysis (EIA) models and benefit–cost analysis (BCA) tools. However, that leaves a gap for Middle Stage Planning, in which full blown models may not be necessary, but initial steps must be taken to identify the motivation for proposed projects and document their magnitude. The products of this new study are designed to help to inform planners at this middle stage, by providing tools they can use to document intended transportation impacts that lead to wider economic benefits. These tools can also help to extend the usefulness of BCA and EIA models, by allowing them to fully incorporate information on wider economic benefits. Building on Earlier SHRP 2 Products The tools described in this report build on outcomes and findings from an earlier SHRP 2 project (C03) that developed a national database of case studies documenting the actual, post-construction economic impact of highway and multi- modal investment projects. The results of that effort are pro- vided through a web tool, T-PICS, which can be accessed on the web at www.tpics.us. That tool has two distinct uses: 1. It provides a searchable database of case studies covering most types of highway and intermodal facilities. For any type of highway-related project, it is likely that at least a few case studies of experiences elsewhere can be located. Used this way, the case studies provide a rich body of data that can be accessed to immediately inform the public and planners about past experience with similar types of projects, and that information can be used to improve Early Stage Planning. It also provides a database that enables further research on the topic. 2. It provides an expert system that draws from the database to estimate the range of economic impacts most likely to result from any specified type of project in a defined setting. This represents a form of “analysis by analogy,” and is a way to define what constitutes a reasonable range for expected impacts of proposed projects, based on prior experiences. The T-PICS searchable database facilitates further research, and indeed the SHRP 2 C03 Final Report (specifically, Table 4.9 in that report) notes that among the 100 highway capacity enhancement projects that were studied, the dominant moti- vations were to (1) reduce congestion bottlenecks that add to delay and travel time unreliability, (2) enhance market access for jobs and businesses, and (3) enhance connectivity to intermodal terminals. The T-PICS database contains mea- sures of those elements, and indeed the case study narratives included with T-PICS confirm their importance. In fact, a variety of state DOTs already have project ranking systems that give added priority to proposed projects that enhance intermodal access, system connectivity and business markets. These factors are also recognized as legitimate elements of productivity benefits that can be incorporated into benefit– cost analysis methods applied for federal grant applications. Despite recognition of the importance of these factors, traditional economic analysis tools (particularly those for benefit–cost analysis) have tended to focus on measurement of the benefits of time savings, expense reduction, and safety enhancement rather than business productivity benefits of improving reliability, intermodal connectivity, and access to new markets. The use of T-PICS to help assess likely impacts of proposed projects must be conducted carefully. The T-PICS web tool has been a source of interest in the transportation planning community because of the way that it blends ease of use with a complex underlying set of quantitative and qualitative data derived from empirical analysis. Yet, one of the reactions to the case studies and web tools developed for T-PICS has been a concern that case studies can be taken out of context or be otherwise misconstrued. That can occur if a project’s pro- ponents or opponents choose to recognize only those cases that fit their needs, or even when they make well-intentioned mistakes. However, naive users mistakenly draw conclusions that every project can be expected to achieve the average results achieved by similar projects elsewhere. The appropriate answer to the concern about misuse of cases is not to require complex simulations or reliance solely on case studies, but rather to develop useful tools that can bridge the gap between these options. Those tools are the subject of this study, focusing specifically on the key factors that are widely recognized by planners, yet often poorly documented by analysts. The spreadsheet products described in this report are intended to fulfill three needs for the SHRP 2 Capacity Research Program. First, they are intended to complement the SHRP 2 Project C03 product (T-PICS) and enhance the ability of trans- portation analysts to better incorporate economic issues into middle stage sketch planning applications. Second, they are intended to extend the base of open source, public information and tools that researchers and consultants can use to provide more detailed analyses. Third, they are structured to reinforce the overall integration, usefulness, and accessibility of the multi- stage decision-making framework that is the core of SHRP 2 Project C01.