COMPARING COST-EFFECTIVENESS ACROSS MODES

The flexibility provisions of the Intermodal Surface Transportation Efficiency Act (ISTEA) require Metropolitan Planning Organizations (MPOs) in cooperation with States and transit operators to make funding decisions among alternative transportation solutions involving more than a single mode. With little past experience in cross-modal evaluation, MPOs will need to develop the ability to make cost-efficiency and cost-effectiveness comparisons across modes at the project and system level. New ISTEA requirements for Congestion Management Systems and for considering multiple factors in metropolitan planning and programming will further increase the importance of multi-modal evaluation capabilities. Cost-effectiveness is listed as an objective for use of Federal funds in several places in ISTEA. In the past, MPOs have seldom used cost-efficiency measures to compare projects or alternative systems. Also, they have usually compared solutions using measures of effectiveness which are uniquely applicable to a specific mode. For example, a measure of highway project effectiveness used often is improvement in highway level of service or highway speed. Transit project effectiveness, on the other hand, is often measured by increase in transit ridership. If highway and transit solutions are to be compared, common measures of effectiveness applicable across modes will have to be used. Also, if cost-efficiency measures are to be emphasized, costs and benefits (including social and environmental costs and benefits) will need to be converted to dollar terms to the extent feasible. These cross-modal comparisons require development of a new evaluation framework which allows full accounting of all costs (i.e., public, private and social) and which includes measures of effectiveness that can be applied across modes. MPOs will have to attempt quantification of the impacts and true costs of transportation alternatives to assist decision-makers in making the tradeoffs between alternatives. This paper provides a case study demonstrating how comparisons can be made among investments for three alternative modes -- single-occupant vehicle (SOV), high-occupancy vehicle (HOV) and transit, based on cost-effectiveness measures such as (1) public costs per commute trip and (2) total costs (i.e., public, private and social costs) per commute trip. Comparisons are made for commute trips between nine pairs of work and home locations involving three urban location/design categories: Central Business District (CBD), urban core and fringe in a typical large urban area (population more than 1 million). The results of the analysis suggest that disparities in cost-effectiveness among modes vary significantly by employment/residence location combination. The paper discusses the policy implications of the disparities among modes.