Developing a Methodology to Quantify Benefits Associated in Roadway Construction

Abstract: Benefit-cost analysis (BCA) is a well-established method for assessing the economic effectiveness of a roadway construction project (the "Build" scenario) in comparison to a "No-Build" scenario. The primary components of this analysis are costs and benefits. Costs associated with the Build option are evaluated against those of the No-Build option to estimate the overall benefits and costs of the construction scenario. The costs of a roadway alternative primarily include agency costs and user costs over a specified analysis period. Agency costs encompass pre-engineering expenses, initial construction costs, and ongoing operation and maintenance (O&M) costs, while user costs cover travel time, vehicle operating costs, safety, emissions, and health impacts. In this study, a methodology was developed to estimate these costs and benefits, allowing for an assessment of economic effectiveness relative to the No-Build case. The methodology was successfully applied to a construction project, and sensitivity analyses were performed on factors such as traffic growth rate, discount rate, and detour length. Notably, at a projected traffic growth rate of 0%, the project yielded a favorable benefit-cost ratio (BCR) of 3.66 and a net present value (NPV) of $5,063,753. These results demonstrate that the proposed bridge replacement is a valuable and cost-effective investment, underscoring the necessity for timely infrastructure improvements to enhance overall transportation efficiency and safety.