Framework and Tools for Estimating Benefits of Specific Freight Network Investments (2011) / Chapter Skim
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Pages 20-26
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From page 20... ...
In general, freight projects can affect four types of stakeholders, which the study team grouped as: • Asset providers who develop, lease, maintain, or finance freight investments (both fixed and mobile) ; • Service providers who provide transportation or logistics services for freight shipments; • End users who include both shippers/consignees, as well as end customers for finished goods; and • Other impacted parties who include neighborhood/ community interests, environmental/land use interests, business interests, and others.
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However, the interests of these parties are an important consideration in making investment decisions, because impacts and benefits to these stakeholders can influence the net benefit-cost calculation made by those with direct financial stakes. • Parties that have a major nonfinancial stake in the result of a freight investment.
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From page 22... ...
Asset Provider Service Provider End User * Other Impacted Party *
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From page 23... ...
1. Cost factors include • Facility capital costs, which tend to be dictated by site location and design, as well as the partners involved in the planning process; • Facility maintenance costs, or the ongoing costs of maintaining a facility to ensure safe operations and upkeep; and • Operating costs, such as labor, fuel, and equipment costs, as well as the time lost to congestion or to the breakdown of efficient supply chains.
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From page 24... ...
Stakeholder types and benefits. Benefit Category Cost Factors Facility Capital Costs Facility Maintenance Costs Operating Costs Benefit and Other Impact Factors Capacity (Includes Bottleneck Congestion)
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For the private sector to participate, the publicsector agency should have established policies, processes, and frameworks that facilitate a partnership, including the following: • Structure -- A functional regulatory and institutional framework acts as a roadmap for proceeding; • Public need -- A demonstrated need for such a partnership adds purpose and mutual goals; • Feasibility -- Demonstrable feasibility with respect to economic market, technical, environmental, financial, and risk allocation aspects is important; • Risk management -- A clear understanding between the allocation of risk and benefits/rewards is critical; • Transparency in procurement -- Good access to relevant materials allows for accurate evaluation of benefits and costs, which in turn reduces the need for estimating values of withheld information; • Proper due diligence -- Verifying actual and projected volumes/turnover, costs, revenues, and risks; • Public-sector "buy-in" -- Identifying issues pertaining to permitting and acquisition; • A strong and "true" partnership -- Should be set forth in a clear contractual framework; and • Innovation -- In handling costs, risks, and revenues. Understanding the risks associated with a project involves evaluating design and construction, market risk, operation and maintenance risk, financing risk, insurance, and termination risk.
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From page 26... ...
26 Table 2.7. General template of risks.
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