A COST-BENEFIT ANALYSIS OF NETWORK LEVEL PAVEMENT MANAGEMENT

This paper presents a cost-benefit analysis developed on behalf of the BC Ministry of Transportation and Highways, using the Alberta PINS/RIPPS system as a case study. The analysis was prepared as a business case to senior management at MOTH to assist in their decision to proceed with the development of a province-wide PMS. The costs are presented as development and on-going support costs incurred over a five year period from 1986 to 1990. Benefits are expressed in terms of: 1) the savings in vehicle operating costs as a result of a higher average network condition (user cost savings); and 2) the savings in the value of the Provincial highway system as a result of an improved condition (agency savings). A secondary case of the State of Arizona PMS implementation quantified the savings generated via the PMS in actual rehabilitation dollars (rehabilitation dollar savings). While not an exhaustive economic analysis, the cost-benefit case studies represent a first look at the order of magnitude of cost and benefits to be realized through PMS. The case of Alberta PINS/RIPPS provides not only cost-benefit ratios in the range of 1:142, but also a return on investment to the agency of approximately $60 million per year. The benefits to the agency directly relating to the use of a formal PMS are very difficult to estimate as a portion of the user cost and agency savings can be attributed to the rehabilitation expenditure regardless of the system used to program the improvement. However, the cost-benefit ratios developed in the Alberta case study demonstrate that even if a small percentage of the savings are attributable to a formal PMS, the benefits far outweigh the cost. For the covering abstract of this conference, see IRRD number 853909. (A)