The American Public Transportation Association (APTA) and the American Association of State Highway and Transportation Officials (AASHTO) have recently released a report which offers a methodology for cities, metropolitan agencies, state DOTs, and federal agencies to take a more holistic view when evaluating the social, economic and environmental benefits of passenger rail projects.
“The traditional benefit-cost analysis has a very narrow definition of user benefits that does not cover or capture or recognize the importance of a lot of things that are important to communities and residents,” said economic analysis firm EBP’s Glen Weisbrod, one of the report authors. “The concept here is to redefine the public return on investment.”
The report advocates for a private sector “business case” for investment with a return on investment (ROI) formula that includes benefits to rail development, such as community investment, cleaner air, and access to more economic markets.
The report is made up of 3 volumes:
- Guide for Decision Makers – which lays out the concept of a public franchise and the factors that can be part of a public return on investment (ROI);
- Methodology – which provides further information on the multiple perspective view, a description of available tools and methods that can be used, and step-by-step instructions for measuring the various elements of public benefit that can be result passenger rail investment; and,
- The ROI tool – a separate spreadsheet which provides a way to allocate benefits among relevant parties and then calculate ROI for different stakeholder groups.
“America has an opportunity to build a high-performance rail network to position us to overcome our economic challenges and compete in the global marketplace in the coming years,” APTA President and CEO Paul Skoutelas said. “Passenger rail is an underutilized mode, and ripe to connect with national and local transportation networks and rural areas with high-performance corridor services. Development of a national network and national rail plan should be guided by federal, state and regional planning efforts, and coordinated with the various state-supported intercity passenger rail corridors. The Business Case ROI Tool included with this new guide will be vital to calculating a societal return on investment for intercity passenger rail investments as viewed from the perspectives of these stakeholders.”