GUIDE TO PROJECT EVALUATION. Part 3: Models and Procedures

GUIDE TO PROJECT EVALUATION Part 3: Models and Procedures

Guide to Project Evaluation Part 3: Models and Procedures

Guide to Project Evaluation Part 3: Models and Procedures Summary Part 3 presents a summary account of the Austroads publications and other related sources of information that describe the wide range of tools used in project evaluation. In Part 3 a distinction is drawn between rural project evaluation procedures and urban (network) procedures, given that different applications have been developed in Australia and overseas to deal with these contexts. Part 3 provides a summary account of the activity in the area of project evaluation tools, and presents a guide to major sources of information from recent research and development work. Keywords Project evaluation tools, models, procedures, economic, urban, rural, costs, vehicle operating cost, un-monetised impacts First Published 2005 Austroads Inc. 2005 This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without the prior written permission of Austroads. National Library of Australia Cataloguing-in-Publication data: ISBN 0 85588 738 9 Austroads Project No. TP1050 Austroads Publication No. AGPE03/05 Authors Dimitris Tsolakis Sarah Patrick Thorolf Thoresen Published by Austroads Incorporated Level 9, Robell House 287 Elizabeth Street Sydney NSW 2000 Australia Phone: +61 2 9264 7088 Fax: +61 2 9264 1657 Email: austroads@austroads.com.au www.austroads.com.au This Guide is produced by Austroads as a general guide. Its application is discretionary. Road authorities may vary their practice according to local circumstances and policies. Austroads believes this publication to be correct at the time of printing and does not accept responsibility for any consequences arising from the use of information herein. Readers should rely on their own skill and judgement to apply information to particular issues.

CONTENTS 1. INTRODUCTION TO TRANSPORT MODELS AND PROCEDURES... 1 2. URBAN AND RURAL CONTEXTS... 2 3. TRANSPORT MODELS... 3 3.1 Travel effects... 3 3.2 Travel volumes over time... 5 4. MODELS AND PROCEDURES FOR A RURAL CONTEXT... 6 4.1 Rural models used in Australia... 6 5. MODELS AND PROCEDURES FOR AN URBAN CONTEXT... 7 5.1 Urban models used in Australia... 7 5.2 TRAMS model... 8 6. EVALUATING NON-MONETISED IMPACTS... 10 6.1 Multi Objective Decision Support Systems (MODSS)... 10 PART 3 COMMENTARIES... 12 COMMENTARY A: MODELS AND PROCEDURES FOR A RURAL CONTEXT... 12 A.1 Rural models in use in Australia... 12 A.2 Harmonisation of travel cost estimates... 14 A.3 Downloadable BCA input files... 15 A.4 Town bypass (new) links... 15 COMMENTARY B: MODELS AND PROCEDURES FOR AN URBAN CONTEXT... 16 B.1 Updating urban journey speed VOC models... 16 COMMENTARY C: EVALUATING UNMONETISED IMPACTS... 17 C.1 MODSS process... 17 C.2 The Austroads MEAT Model for Multi Modal Assessments... 17

1. INTRODUCTION TO TRANSPORT MODELS AND PROCEDURES Part 3 is developed as support to Part 2: Project Evaluation Methodology of the Guide to Project Evaluation (the Guide). It is a resource publication bringing together available models and procedures that are used in project evaluation. It is based on existing Austroads publications as well as other relevant literature. Austroads member agencies have tended to develop their own (in-house) project evaluation models, procedures and approaches. The approach towards improving and developing the procedures has been to implement a harmonisation process aimed at ensuring different models yield equivalent outcomes when applied to common evaluation case studies. The harmonisation process also aims to develop improved methods or algorithms for estimating impacts associated with projects which can be applied to each of these models. 1

2. URBAN AND RURAL CONTEXTS Distinctly different methodologies have been developed for urban and rural project evaluation. These distinct approaches reflect the different impacts of traffic, alignment and network density. In rural environments where network densities are sparse, project links can be evaluated either in isolation, or in reference to relatively fewer links that are affected by improvements. In addition, low traffic volumes result in alignment and surface condition being important means of reducing vehicle operating costs, and thus generating benefits. Models and procedures for rural network project evaluation in Australia are currently individually developed and managed in different jurisdictions. In urban environments, the addition of a transport project not only results in traffic changing route but also can result in traffic changing its destination, its time of travel or people choosing to travel by a different mode. Project evaluation in this case must consider a sufficiently large portion of the transport system to contain all the changes in travel that occur as a result of the project. Models and procedures suitable for urban network project evaluation are still developing. However, there is increasing demand for a more concerted effort that promotes use of a harmonised project appraisal framework across all road agencies. 2

3. TRANSPORT MODELS Transport models attempt to estimate two key sets of parameters; travel effects and travel volumes over time. 3.1 Travel effects Travel effects represent all benefits/costs involved in providing and operating a (road) transport system, other than costs incurred by the agency responsible for providing and operating the (road) infrastructure. Costs and benefits in project evaluation are usually classified in the following three groupings: capital, operating and maintenance costs (project and other costs/savings) travel costs (vehicle operating and travel time - congestion - costs/savings) other costs (accident costs/savings as well as social and environmental costs/savings). Accurate estimation of travel costs is a key component in the economic assessment of road expenditures of all types, including expenditures on new road projects or maintenance, rehabilitation and upgrades of existing road assets. Travel costs are calculated by separately estimating the value of each of its components. The component costs vary with the variables shown in the table below (see also Thoresen, 2002 and Austroads, 1997). 3

Travel Costs Category Variables of component costs Travel Costs Variables Vehicle operating costs hourly flow rate distribution throughout the year traffic volume traffic composition vehicle type seal or gravel pavement width Speed of travel number of lanes lane width gradient curvature Fuel consumption vehicle type fuel type speed gradient Oil consumption engine size Tyre wear vehicle type (no. of tyres) speed gradient Vehicle depreciation vehicle type speed Vehicle repair and maintenance vehicle type speed Persons per vehicle trip purpose Road crash costs traffic volume road stereotype weather conditions Annual routine maintenance traffic composition traffic volume seal width climatic conditions Periodic maintenance age of seal life of seal Project costs discount rate surface type road roughness speed of travel road curvature road gradient roughness traffic volume change in flow rate throughout the year curvature surface type roughness curvature surface type roughness surface type roughness surface type roughness curvature speed limit region age of pavement age of seal cost of reseal Reductions in magnitudes of travel effects comprise one of the major benefits generated by transport infrastructure investments. Such reductions are typically offset against transport agency and other community impacts associated with infrastructure investment. Consideration of travel effects allows for assessments of transport solutions that involve other modes of moving passengers and goods. 4

3.2 Travel volumes over time Temporal variations in traffic volumes are a critical input in investment planning for expanding network capacity. This applies to both urban and rural networks, although the traffic dynamics tend to vary significantly between the two. Capacity constraints, and the resulting congestion impacts on travel effects (travel times, vehicle operating costs (VOC), crash costs and environmental externality costs) are seldom encountered uniformly throughout the day. Traffic distribution (both temporal and spatial) often influences investment decisions aimed at increasing network capacity to moderate peak traffic congestion. However, it also influences decisions related to better managing travel demand via a more integrated use of transport resources (eg. use of other modes and improved planning of networks and land use). Most project evaluation models and procedures for roads currently require users to input information detailing how traffic varies over typical time periods (i.e. day, week, year, or season). 5

4. MODELS AND PROCEDURES FOR A RURAL CONTEXT Travel effects in the rural context typically concern road attributes only. Traditionally, economic assessment of road projects is built around inventory records of the road system containing details on geometry (gradient and curvature), seal or pavement width, surface type and road roughness with traffic volumes, traffic composition and growth rate being added to the inventory. The travel costs are then calculated by separately estimating the value of each of its components. For rural contexts, vehicle operating costs are mostly assessed on the basis of uninterrupted flow conditions (i.e. no intersections). A strong assumption that traffic is held constant between the base case and project case analysis is often made in these analyses. Where the number of lanes is not being increased, the change in travel effects will mostly come from the effect of changes in one or more of the inventory items, for example, reduction in road roughness, increasing the speed value of low speed curves or increase in lane width. For rural applications traffic volume over time typically involves users providing information on how traffic varies over the 8760 hours of the year. Information is usually provided for predefined sets of hourly traffic volume categories, with the unit of measurement being percent of AADT (annual average daily traffic). This practice has now been adopted by the HDM-4 procedure, whereas its predecessor the HDM III did not have this facility (see Thoresen and Michel, 2002). 4.1 Rural models used in Australia State models have been developed in various degrees by each jurisdiction over the years to use in the economic appraisal of road infrastructure investments. Each of the five larger jurisdictions in Australia uses and maintains its own computer based model to estimate the effects on travel costs of alternative proposals and strategies for investment in road infrastructure. Smaller jurisdictions mainly use one of the following models when they consider travel costs in their project appraisals: WARES (Western Australian Rural Evaluation System) fully integrated with the road inventory EVAL4 (VicRoads Rural Evaluation Model) fully integrated with the road inventory (EVAL-4 is also used to estimate urban RUC and to evaluate a number of urban projects) NIMPAC uses engineering standards to assess total transport infrastructure costs for asset preservation plus network additions over a certain period. HDM-4 used in connection with Pavement Management Systems dtims used to assess maintenance strategies for existing pavements. Commentary A provides more detail about these models. [see Commentary A] 6

5. MODELS AND PROCEDURES FOR AN URBAN CONTEXT The urban road network is dense, so alternative routes are almost always available. In addition there are alternative mode choices such as walking, cycling and public transport. Any change in the road or intersection capacity will almost always result in a change of route for some traffic as a minimum. There may also be a change in the choice of mode, the choice of a destination, or the time of travel. For urban network applications, the number of time and traffic volume categories are often more complex than for those for rural networks. For example, two different traffic distribution histograms to represent the variation of hourly flow rates throughout the day as a percentage of the daily flow rate may have to be used one for the one-way flows and one for the total volume entering network intersections. The number of time and volume periods can vary between evaluation models and jurisdictions (see Tsolakis and Lloyd, 2000). In the urban context, the effect of congestion and intersections has a much bigger impact on travel effects than road roughness or lane width. Also, primary urban roads do not usually reach the same high levels of roughness as rural roads. It is usual in urban evaluations to assume that roughness and geometry effects of the road network are neutral in terms of assessing user benefits. Most users estimate travel costs in an urban environment by applying formulae of uninterrupted travel costs as a function of either link average speed or journey average speed. The effect of the increased costs imposed by intersections may be allowed for by a percentage increase on the uninterrupted costs, or may be ignored. Changes in travel time costs can also be estimated using empirically based travel time functions (eg. US Bureau of Public Roads, Davidson, Akcelik, etc. in Akcelik, 1991). Travel costs may be estimated at one or two points in time. Assumptions are then made in order to estimate the project benefits for all the years of the analysis. The need to stop at intersections adds between 20 50% to travel costs compared to travelling the same distance at the same speed without interruptions. In portions of the network, demand flows in peak periods exceed capacity, causing queues and delays to vehicles. The probability of stopping at intersections increases with increasing levels of demand. The use of average speeds over say a one hour period will not provide accurate estimates of travel costs. 5.1 Urban models used in Australia There have been few attempts in Australia to develop comprehensive models and procedures for estimating travel effects of urban networks. Both the travel cost evaluation facilities and their links with transport planning models vary from jurisdiction to jurisdiction. In most of the road and transport authorities (Queensland, New South Wales, Victoria, Tasmania and South Australia), some form of a spreadsheet facility is used to estimate travel costs in the evaluation of urban projects. For Victoria and New South Wales, and to a lesser degree Queensland, these facilities are informally linked to the authority s modelling frameworks used to forecast traffic (i.e. urban transport demand models). 7

The most commonly used transport demand models include the TRIPS package (and more recently the CUBE platform), the EMME/2 toolkit, and the VLC-Zenith and VLC-Transcend modelling software. All of these transport demand models provide detailed trip information for passengers and freight and there are emerging expectations of these models to accommodate environmental issues and development and other impacts. However, none of these transport demand models have an evaluation model formally linked to them. Austroads (2000) lists several of the transport demand models known or used in Australia and presents a brief description for each model. 5.2 TRAMS model [see Commentary B] The Western Australian TRAMS modelling framework provides an urban evaluation model that can be formally linked to TRIPS and can potentially be developed to interface with other key transport demand models. This is achieved by using the TRAMS modelling platform (together with a well developed Database) that has the potential for all urban road projects to be readily evaluated using a common methodology. Forecasting traffic in an urban environment is usually done using a four step procedure (five steps in the case of TRAMS). These steps are: trip generation the number of trips that start and finish within a zone are estimated from land use activities, number of jobs, number of educational enrolments, number of dwelling units etc. trip distribution the two ends of a trip are joined together to make a matrix of travel from production to attraction or origin to destination mode choice a matrix of person travel is shared between modes such as walk, public transport, car passenger and car driver trip assignment person trips are assigned to public transport routes and vehicle trips are assigned to road links evaluation in TRAMS, a fifth step of estimating the change in travel cost between the last estimate of road volumes and the last-but-one estimate of traffic volumes is made. This difference has to be less than a user specified amount before the iterative procedure is deemed to be closed and the trip table accepted. The level at which to undertake an urban evaluation depends on the expected traffic effects of the project. The quality of the data needed and the modelling of the transport network (including traffic forecasts) is critical in minimising the errors that are often introduced when analysing and forecasting complex trip activity. For example, if the traffic effect of a project is limited to change of route only, then the analysis can be uni-modal over the road network. If, however, more complex changes are expected, the analysis will need to be multi-modal, and may also require modelling of aspects such as destination choice, trip generation, trip timing, etc. Depending on the complexity of the situation, more and more steps of the traditional four-step traffic forecasting process will come into play. If aspects such as trip timing and household location choice are critical, more advanced models become necessary. 8

5.2.1 TRAMS estimate of travel costs The TRAMS system estimates travel costs in a network environment by separating the costs into three components; time spent stationary at intersections the cost of decelerating and accelerating to and from intersections the costs of travelling between intersections at a steady speed. The probability of having to stop at an intersection is calculated from an intersection capacity analysis for each intersection in the network. The model is based on all day volumes and breaks the traffic into components based on the distribution of the number of hours per day of the flow rate as a percentage of the daily flow (see Tsolakis and Lloyd, 2000). 9

6. EVALUATING NON-MONETISED IMPACTS In addition to utilising BCA in project appraisal, most Australian transport agencies and departments also employ broader evaluation techniques to support infrastructure provision decisions. Typically these techniques take into account the multiple objectives normally associated with road provision which may require use of a wider range of information including difficult to monetise impacts. While such methods vary considerably in structure and output, they are increasingly grouped together under the broad term Multi Objective Decision Support Systems (MODSS). This includes techniques such as Multi Criteria Analysis (MCA) 1 and Goal Achievement Matrix (GAM) methods. See Part 2 for more about a multi-goal approach to project evaluation and descriptions of the MCA and GAM approaches. Compared with BCA approaches, there is minimal standardisation and harmonisation between multi goal type of approaches adopted between, and sometimes within agencies. This has led in some cases to limits being placed by decision makers on the perceived value and acceptability of the outputs of such methods. Problems raised with respect to these methods usually revolve around subjectivity, proneness to manipulation, and non-comparability of outputs between different assessments. 6.1 Multi Objective Decision Support Systems (MODSS) MODSS for road project evaluation was developed for Austroads (Thoresen 2000a). Current MODSS software permits the analyst to evaluate and compare up to 50 projects or project options. As such it can be used both as a means of selecting project options, or choosing between alternative projects for inclusion in an investment portfolio, via a process similar to program budgeting in benefit cost analysis. MODSS processes seek to evaluate projects and project options on the basis of their performance against multiple objectives, as well as against single overall magnitudes. The feature that unites these approaches is that scores and weights are used to arrive at measures which can be used to determine whether projects make society better off, and whether one project or project option is to be preferred to another. It should be noted that conventional BCA uses a similar linear additive process, with the difference that unit prices or costs are used in place of weights, and physical measures of positive and negative impacts are used in place of scores. As MODSS style approaches are not standardised across agencies, there are no common sets of objectives, associated attributes and associated weights, equivalent to the tabulations of prices for standard input items as utilised in BCA appraisals and employed by the same agencies. A first step towards standardisation was taken with the development of a standard set of objectives, and a corresponding set of project attributes as described in Thoresen (2000a). These objectives and attributes are shown in the table below. In the same way that prices of inputs into BCA analysis vary between and within jurisdictions, weights can vary similarly. In addition it is not clear to potential users of the means by which such weights can be derived. To assist in this process Austroads sought to develop suitable methods and briefing material (see Commentary C for more information). [see Commentary C] 1 Under a MCA process of evaluation, project performance is not measured in the single metric of money but in a variety of metrics. While in Benefit Cost Analysis (BCA) all inputs and outputs are expressed in a single metric, money, MCA stops short of this: some inputs and outputs are instead left in physical or other units, which makes the task of monetisation usually the responsibility (and choice) of decision-makers. 10

Inventory of national objectives for use in project evaluation Dimension Description of Objective Type of Objective Consistency with Standard BCA Practice Currently Consistent Economic Efficient provision & operation of road infrastructure Efficiency Potentially Consistent Not Applicable Lower road user resource costs Efficiency Safety Lower non-road costs of road users (regulations etc) Efficiency Increased regional development Efficiency Expansion of the scope of markets Efficiency Economic based choices of transport vehicles, modes, routes, and times of use Efficiency Supportive of effective land use. Efficiency Improved overall performance of the economy Efficiency Reliable transport of people and goods Efficiency Lower levels of road related death, injuries and costs Efficiency Safe transport of hazardous loads Efficiency Environmental Lowered levels of air pollution and greenhouse gas emissions Efficiency Reduced other adverse environmental impacts Efficiency Social A basic level of accessibility Equity Wider set of choices, opportunities for interaction Social Justice/ Functioning Fair distribution of costs and benefits Equity National Improved overall social functioning of the community Provided and operated with the efficiency required for Australia to compete in the global economy Provided and operated in manner compatible with the nation s goals including defence Social Justice/ Functioning National Policy National Policy 11

PART 3 COMMENTARIES [back to Guidelines] COMMENTARY A: MODELS AND PROCEDURES FOR A RURAL CONTEXT A.1 Rural models in use in Australia The principal non-urban project evaluation models currently employed by Australian road and transport agencies are shown in terms of their characteristics and capabilities in the table below. The information displayed in this table not only illustrates how individual methodologies can differ in terms of capability, but also demonstrates, with one exception, how agencies have developed and utilised their own in-house methodologies. The exception in this case is the Tasmanian Department of Infrastructure, Energy and Resources, which has adopted the CBA 4 procedure, as originally developed by the Queensland Main Roads Department. Estimates of changes in vehicle operating costs and other travel effects are used in the evaluation of investment proposals for new road infrastructure and for maintenance and rehabilitation of existing road infrastructure. All models except the BTRE model, share a common ancestry. Travel cost models in Australia fall into two distinct families, namely NIMPAC and HDM. There are differences in scope as well as detail between models in these two families. NIMPAC models are based on Australian work in the 1970s led by NAASRA and the then Commonwealth Bureau of Roads culminating in the NIMPAC Road Planning Model, completed in 1981. HDM models are based on the World Bank Highway Planning and Management Models (HDM III) released in 1987 and the Highway Development and Management model (HDM-4) released in 2000 (version 1). The release of version 2 is expected in 2005. Rural travel cost methodologies currently employed by member authorities (model used, and classification) Agency Roads & Traffic Authority (N.S.W) Estimation Procedure or Project Evaluation Model REVS 5 VEHOP VicRoads (Vic) EVAL 4 5 Main Roads (Qld) CBA 5 3&4 Dept of Transport (SA) METMERRI DIER (Tas) CBA 4 Main Roads (W.A) Bureau of Transport and Regional Economics (BTRE) RURAL RIAM 2 Type of Travel Cost Estimation Method Full Model 1 Look-up-Table Model (1) Full models estimate speed internally, while look-up tables require end users to estimate speed externally, the magnitude of which is used to pick appropriate travel costs from a look-up-table indexed on speed, road infrastructure and traffic characteristics. (2) The BTRE s RIAM model makes use of the HDM IIIC travel cost estimation package. (3) CBA 4 has been recently updated to form the next generation of CBA 5. (4) CBA 4 also used by the Tasmanian Department of Infrastructure Energy and Resources. (5) HDM III or HDM 4 used in connection with Pavement Management Systems. 12

All of the State models listed are based on the Australian NIMPAC family of models. The BTRE model varies from the norm as it is based on a version of the World Bank s HDM III model calibrated for Australian conditions by ARRB Transport Research. This version was further developed by BTRE to allow their RIAM model to handle the combined effects of traffic capacity and congestion. These latter capabilities were not available in the original HDM III model. However, such capabilities have been added to the current generation HDM 4 model. Modelling procedures used by road and transport agencies fall into two categories in terms of capabilities and coverage - full models and look-up-table models. Only one agency, the Roads and Traffic Authority of New South Wales, currently employs models in both categories. Full models automatically generate travel cost estimates tailored to fit specified project evaluation tasks. This is accomplished via within-model computation of travel speeds, and their subsequent utilisation in calculating speed sensitive travel cost components such as fuel costs and travel time savings. In contrast, look-up-table models provide the user with a range of intermediate travel cost data, in the form of a series of look-up tables where estimated travel cost items are cross tabulated by a set of fixed pre-determined speeds. In order to make use of this data, analysts are required to choose the appropriate speed of vehicle operation and to manually enter selected data into project evaluation applications. Despite these differences, these two model categories share common estimation methodologies and sources of data, and are both harmonised. However, full models are mostly incorporated into broader fully developed project evaluation methodologies in which travel cost estimation forms one component part. Each of the look-up-table models consists of a stand-alone travel cost estimation procedure. Details of these models are described in the associated Evaluation Manuals produced and maintained by each jurisdiction. See RTA (1999); SA Government (1990); VicRoads (2002); QDMR (2003); and MRWA as in Lloyd (2002). Travel cost components Each of these models generates estimates of travel costs at an individual component level. These components are subsequently aggregated to provide estimates of total travel costs. The table below clearly distinguishes between those factors which road and transport agencies can affect via road works and other interventions, and those determined by users. There are also significant differences between NIMPAC and HDM III style models in terms of the ways they quantify the effects of pavement width, number of carriageways and access control. However, HDM-4, the successor model to HDM III, incorporates a width and road capacity speed adjustment similar to the NIMPAC relationship, which will bring the two evaluation model families closer together when the HDM-4 models become widely used in Australia. 13

Factors affecting travel cost components-relationships assumed in road evaluation procedures Travel Cost Items and Other Units Speed Vehicle Characteristics Type & Specs. Mass Fuel Type Gradient Curvature Road Infrastructure Characteristics Width Access & Capacity Surface Type & Condition (1) Speed Limits etc Traffic Volume PCUs Speed (2) Vehicle Operating Costs Fuel & oil (3) Tyres (3) Repair & maintenance Depreciation (4) (5) Interest (4) (5) Overheads (6) Time Costs Private travel Business travel Professional Driver Freight delay Other costs (7) (7) (7) (7) Freight damage Notes: 1) Road surface type NIMPAC models only. 2) In HDM III road widths affect speeds when pavement widths are less than 4.5 meters. 3) Not in HDM III models except BTRE (RIAM) variant. 4) Not for cars 5) ARRB TR variant of HDM III only. Road surface type affects depreciation in all NIMPAC style models 6) HDM III models only 7) Calculations require cost per hour inputs provided in other Austroads publications (Thoresen, 2000b). A.2 Harmonisation of travel cost estimates As discussed above, Australian road and transport agencies use a range of methods, models and procedures to estimate travel costs for use in project evaluation. Concern by Austroads that different approaches and procedures could generate significant variations in travel cost estimates led to the formulation of a process for travel cost harmonisation standards. Harmonisation in this context is the process designed to ensure that the different methods and models employed to evaluate projects would yield similar travel cost estimates when applied to a specified range of scenarios in which infrastructure and traffic characteristics are similar. Harmonisation comprises an alternative to achieving comparability of travel cost estimates by specifying use of a single model, or narrow range of model procedures. Austroads developed a strategy and instituted a linked program of research aimed at simultaneously harmonising and improving estimation of travel costs (Austroads, 1997). The main focus of this work is on rural (or non-urban) traffic conditions, where considerable progress towards harmonisation has been made. See Thoresen (2002) for most recent work on the harmonisation framework. Estimation of travel costs in urban conditions is a separate issue, though also a priority for Austroads. 14

Austroads has also recently commissioned work related to a consistent estimation of accident rates for HDM-4 (see Thoresen 2002). This work provides a starting point for the processes of calibration and harmonisation of accident prediction in HDM-4. It has developed improved methods for estimating accident numbers, which should be equally applicable to all BCA procedures. A computer file named MRS_ACCSPDFL.dbf has been generated, which end users can import into HDM-4 (see below). A.3 Downloadable BCA input files With the general use of purpose written computer software to execute road project evaluation, the opportunity has been created to convert much of the information presented in this report into a format that can be directly electronically imported by such systems. Working against this potential is a lack of uniformity in software employed by individual agencies. Notwithstanding this, sample electronic files of data have been developed, which can be directly downloaded into the HDM-4 package, to demonstrate this process. Two files have been developed to date, which are as follows: MRS_ACCSPDFL.dbf Contains accident rate and cost data as at 30 September 2000, plus speed flow relationships for 22 road stereotypes Aust_Fleet_March_02.dbf Contains parameter values and unit travel input costs as at 30 September 2000 for 20 vehicle stereotypes Eventually a full set of input files covering road use, accidents, environmental impacts and many aspects of pavement performance will be developed for HDM-4 from ongoing Austroads research. It is proposed that these will be regularly updated and maintained by Austroads on its web site as part of its ongoing commitment to supporting harmonised and state-of-the-art project evaluation procedures in Australia. A.4 Town bypass (new) links A small percentage of non-urban road projects need to consider more of the network than just that portion covered by the project. These are town bypasses and new links in the network. In these cases, that portion of the network where the traffic will change has to be considered. The base case project travel costs are summed across all links where the traffic will change. Revised traffic (and traffic composition) figures are used to estimate the total travel costs in the project case analysis. In the case of town bypasses, the traffic on the bypass will pass through a different number of intersections in the project case compared to the base case. For the evaluation to be complete, the costs of stopping at intersections now have to be considered. In its simplest form this can be done by using data from urban VOC models to express the cost of stopping at an intersection in terms of travelling an equivalent length of road under uninterrupted flow conditions. This equivalent distance is added to the appropriate links in the inventory data records being evaluated. Two lengths are used, one for all approaches to a set of traffic control signals, and one for the yield approach to a major/minor road intersection. With these lengths added as appropriate to both the base case and project case road records, an allowance is made for the change in the cost of stopping at intersections resulting from changing the traffic volumes (see Thoresen, Lloyd and Tsolakis, 2001). For more detail see also the town bypass example developed in Part 8. [back to Guidelines] 15

[back to Guidelines] COMMENTARY B: MODELS AND PROCEDURES FOR AN URBAN CONTEXT In Australia, models and procedures suitable for urban evaluation are still developing. Current practice around Australia is by no means consistent throughout the different jurisdictions. However, there is increasing demand for a more concerted effort that promotes use of a harmonised urban network evaluation framework across all transport agencies and departments. The aim of recent Austroads research in this area (see Tsolakis and Lloyd, 2000) is to provide a generalised urban travel costs add on model to be appended to transport planning models used by road agencies in the assessment and evaluation of urban transport networks. The scope of this project is to improve and expand urban travel cost algorithms currently used in TRAMS (which presents a complete benefit-cost-analysis system). B.1 Updating urban journey speed VOC models There is currently a practice in some jurisdictions of employing variants of existing rural models and procedures for performing relatively crude urban network travel cost evaluations 2. Updates of parameter values for these types of evaluations are produced as part of the process of regularly updating and improving unit value estimates. These urban network related parameters are mostly relevant to estimating vehicle operating costs (VOC) only. They are based on estimates provided in Models for Predicting Vehicle Operating Costs in Urban Areas (Cox and ARUP, 1996) and Contextual Review of Two Urban Vehicle Operating Cost Methodologies (Thoresen and Botterill, 1997), which employ specifications of two different Urban Journey Speed VOC models used for urban network project evaluation. The first of these models is used for predicting the effect of average journey speed on vehicle operating costs in stop-start operations where average speeds are less than 60 km/h. The second model predicts the effects of average journey speeds on vehicle operating costs for operations on freeways and high quality arterials where average travel speeds are typically in excess of 60 km/h. The structure of these two models and the associated parameter values are presented in Commentary B of Part 4. [back to Guidelines] 2 The term crude here refers to the use of not fully developed urban network models for project evaluation. An exception has been in Western Australia with its Traffic Modelling System (TRAMS) platform. However, more recently, a number of proprietary urban network models are also used by different jurisdictions on a specific project (consultancy) basis. 16

[back to Guidelines] COMMENTARY C: EVALUATING UNMONETISED IMPACTS C.1 MODSS process The process of conducting a MODSS based project assessment involves the following steps: collecting information on positive and negative impacts of projects (project options), typically measured in a range of measures varying from physical magnitudes to ordinal judgements conversion of quantified impacts into scores falling within a defined range (eg. ±10). This process allows comparison of magnitudes originally recorded in different units amalgamation of scores by first multiplying each by a predetermined statistical weight, and summing all resulting products. A common set of weights is applied to all projects or project options being considered as part of any evaluation. It is argued by proponents that as weights can be derived for impacts for which dollar values cannot be assigned, MODSS processes can process the full range of impacts associated with projects and project options being considered, whereas incomplete BCA type assessments often used in practice are more limited summing weighted scores, as part of either a one or two stage process to determine: whether projects and project options make society better off the extent to which projects and project options perform differentially in terms of particular groups of positive and negative impacts a basis for ranking projects or project options against each other. Each of these outcomes will assist decision makers in choosing which group of projects or project options will be funded or adopted. C.2 The Austroads MEAT Model for Multi Modal Assessments This Austroads study investigated the requirements of evaluation to be applied to projects, programs and strategies, with particular concern for ensuring consistency between all modes of transport (see Austroads, 2001b). The report on multi-modal evaluation techniques summarises a range of evaluation techniques and the concept of weights in evaluation, methods by which these can be determined and an analysis of the role of each technique. The study followed a program of research and development including the development of an evaluation framework and a project evaluation toolkit. The report recommends that an evaluation framework contains the following elements: checklist of criteria (that should be tailored to suit the goals of the project and the decision being made) list of affected parties (that will be tailored to the specifics of the project s area of influence presentation framework (a matrix) for display of the incidence of impacts and their timing decision support system which provides for the aggregation of economic effects and financial effects, and a weighting/scoring system for the valuation of all (or a subset) of impacts 3. [back to Guidelines] 3 There is another important procedure used in project evaluation, i.e. the implied values of non-monetary benefits which are required to bring the NPV up to zero. 17

BIBLIOGRAPHY AKCELIK, R (1991). Travel time functions for transport planning purposes: Davidson's function, its timedependent form and an alternative travel time function. Australian Road Research 21(3), 49-59. ARUP (1992). Economic assessment of urban road projects. Ove Arup & Partners, Melbourne. AUSTROADS (1994). Review and enhancement of vehicle operating cost models: assessment of existing models. Report AP 108/94. Austroads, Sydney. AUSTROADS (1996). Benefit cost analysis manual. Austroads Ltd, Sydney. AUSTROADS (1997). Strategy for road user costs. Austroads Publication No. AP-47, Austroads Ltd, Sydney. AUSTROADS (2000). Improving urban transport demand models and their use. Austroads Publication No. AP-R164/00. Austroads Ltd, Sydney. AUSTROADS (2001a). Project evaluation compendium. Austroads Publication No. AP-R191 Austroads Ltd, Sydney. AUSTROADS (2001b). Multi-modal evaluation and assessment: a perspective. Austroads Publication No. AP-R192/0.1. Austroads Ltd, Sydney. AUSTROADS (2003). Economic evaluation of road investment proposals - unit values for road user costs as at September 2000. Austroads Report AP-R218/03, Austroads Ltd, Sydney. BIGGS, D. (1989). Vehicle fuel consumption estimation program ARFCOM - Users guide. Australian Road Research Board (now ARRB Transport Research Ltd), Melbourne. COX, J. and ARUP (1996). Models for predicting vehicle operating costs in urban areas. Contract Report 8748. Ove Arup & Partners, Melbourne. DOWLING, L. and PETERS, E. (1998). Harmonisation of road user cost models in Australia. Austroads Ltd, Sydney. LLOYD, E. R. and THOMAS, G.S. (1988). Economic evaluation procedures for urban road projects. Advance Planning Section, Main Roads Department, Perth. LLOYD, E. R. and TSOLAKIS, D. (1999). Development of urban road user cost models: a "blueprint" of the TRAMS model. Contract Report. ARRB Transport Research Ltd, Melbourne. LLOYD, E. R. (2002). Update of the WARES system, version 8 (as Austroads No N.BS.9903 part 1 modified). Contract Report. ARRB Transport Research Ltd, Melbourne. MARTIN, T. and THORESEN, T. (1995). Development of a network level pavement life-cycle costing model: Task 1 assessment of existing pavement life-cycle costing optimisation procedures. ARRB Transport Research Ltd, Melbourne. MCLEAN, J. R. (1989). Two-Lane highway traffic operations: theory and practice. Gordon and Breach Science Publishers, Amsterdam. QDMR (2003). Benefits calculation performed by the CBA5 software in Cost-Benefit Analysis Manual for Road Infrastructure Investment. Queensland Department of Main Roads, Brisbane. 18

RTA (1999). Economic analysis manual. Economic Services and Support Branch (now Corporate Finance Advisory Services), Roads and Traffic Authority, Sydney. SA Government (1990). Transport project evaluation guidelines. Office of Transport Policy and Planning. Department of Transport, Adelaide. THORESEN, T. (1994). Review and enhancement of vehicle operating cost models assessment of existing models. Report AP 108/94. Austroads Ltd, Sydney. THORESEN, T (2000a). Further implementation of a multi objective multi attribute project evaluation method: Contract Report (Austroads Project N.RSM 48). ARRB Transport Research Ltd, Melbourne. THORESEN, T (2000b). Economic evaluation of road investment proposals: Unit values for road user costs at June 1997 and June 1998. Report AP 142/99, Austroads Ltd, Sydney. THORESEN, T. (2001). Further development of a multi objective multi attribute project evaluation method: Annex A tutorial and case study material. ARRB Transport Research Ltd, Melbourne. THORESEN (2002). Estimation of road user costs for non urban economic assessments: Harmonisation of estimation algorithms. ARRB Contract Report RC01248. ARRB Transport Research Ltd, Melbourne. THORESEN, T. and BOTTERILL, R. (1997). Contextual review of two urban vehicle operating cost methodologies. Report for Austroads (Working Document R97/033). ARRB Transport Research Ltd, Melbourne. THORESEN, T., LLOYD, B. and TSOLAKIS, D. (2001). Assessment of economic benefits and review of new proposals for Hume highway upgrade at Albury. Prepared by ARRB Transport Research Ltd for Flagstaff Consulting Group Pty Ltd, Project RE1559, July. THORESEN, T. and MICHEL, N. (2002). Improved hourly traffic volume measurement. Report for Austroads Project BS.E.N.012. ARRB Transport Research Ltd, Melbourne. THORESEN, T. and ROPER, R. (1996). Review and enhancement of vehicle operating cost models - assessment of non urban evaluation models, Report ARR 279. ARRB Transport Research Ltd, Melbourne. THORESEN, T. and ROPER, R (1999). HDM-4, Model testing for selected Australian conditions: Review of road user effects models - reasonableness study (HDM-4 beta version 2.08 5 Feb 1999). Austroads Project N.BS.9813. ARRB Transport Research Ltd, Melbourne. TSOLAKIS, D. and LLOYD, B. (2000). Estimating RUC for urban road networks. Report for Austroads Project BS.E.N.502. ARRB Transport Research Ltd, Melbourne. VICROADS (2002). EVAL4 Project evaluation package. Road System Management Department, VicRoads, Melbourne. WATANATADA, T., HARRAL, C, PATERSON, W, DHARESHWAR, A, BANDRI, A. and TSUNOKAWA, K. (1987). The highway design and maintenance standards model: Volume 1 description of the HDM III model. The John Hopkins University Press. Baltimore, Maryland. 19