What is a road worth?

[ACtrafficengr]

Oddball question of the week, from a planning board chair:

What is a road worth? Specifically, a 2-lane rural state highway facing development pressure.

I suppose there are two parts to this question:

1. What is the value of the design effort, ROW, labor, construction & material costs, etc...

2. What is the value of the economic and other activities the road facilitates?

Is anyone familiar with any research in this area? I have a call into the state DOT's GASB 34 section, but any other info or opinions would be appreciated (as always, it helps if you differntiate between the two)

Thanks.

 

[dicksewerrat]

Start with the replacement costs over the design life. Social costs, That is the rest of your question are much more difficult. Look to other areas of t the same demographics about 20 years ago and see what happened there. You may be looking for a suburb that grew up just after the Viet Nam war.

 

[sc]

The first question is relatively easy. The cost of a road to survey, design and build will vary greatly depending on traffic volumes, quality of road required,expected life of the road, etc.

The second question is a full set of "fudge" factors that can vary with the political party in charge at the time. I have seen in Australia the "social and economic cost" of a road vary by up to 200% following an election.

You might want to chase up some cost benefit analysis texts or programs. Also asset managers should know this subject.

Good luck
sc

 

[VoyageofDiscovery]

Hi LTAPJim,

I agree that this is a very subjective area to quantify, however in Canada some very rough numbers to answer your question 1 is:

Two lane highway construction:

Easy conditions: $550,000 to $1,400,000 per kilometre
Moderate conditions: $800,000 to $1,500,000 per kilometre
Difficult conditions: $950,000 to $2,500,000 per kilometre

All in Canadian dollars.

Regards

VOD

 

[KRSServices]

You really know how to ask a loaded question, don't you?

Now let me ask a few of my own first, if I may, because then I can provide an answer relative to you need.

Firstly, are you looking for a net worth (or value) relative to infrastructure or asset management or is related to current/future needs and/or implementation of development cost charges?

Is the value to be used in conjunction with establishing a borrow or a reserve for future upgrades?

From a Planning perspective, is the board requiring this value to determine a logical or sequenced development plan or municipal development plan to ascertain triggers for upgrades and subsequent borrows/local improvements to revocer costs and determine impacts on development?

When you referenced values of economic activities the road facilitates, are you meaning this to be an extrapolation of assessed property values against revenues collected and potential assessment improvements over time (assuming favourable development factors)?

In answer to your question, yes, I've participated in these types of studies (infrastructure and economic development), but the focus/target audience (reader) and desired deliverables/recommendations must be clearly stated because the end values are remarkably different.

KRS Services

http://www.krs-services.com

 

[ACtrafficengr]

Thanks to all for your thoughts on the matter.

I believe he wants to support an argument to prevent the Tragedy of the Commons. He is thinking of the road as a public asset, and part of his job as planning board chair is to protect that asset.

Lacking a good answer to the second question, I gave him NYSDOT's replacement cost of US$1.4 million per lane-mile, and said the value of the economic and other activities the road generates is much higher. I also said that access maangement is a way to protect that asset, and sent him some material on the subject. I'll check back with him later to see if he has further questions.

 

[KRSServices]

Depending on where you are in Canada. My costs here for final paved secondary highway (2 lanes) 1.0 m shoulder is about $425,000 to $550,000 cdn per mile. Difficult is about $475,000 to $675,000 cdn or greater per mile.

KRS Services

http://www.krs-services.com