Benefit

Benefit-to-cost estimates for dynamic pricing applications on freeway shoulder lanes ranged from 1.1 to 8.2.

Mn/DOT experience with managed lanes


September 2010
Minneapolis-St. Paul,Minnesota,United States


Summary Information

In 2005, Mn/DOT completed a Phase I study that examined the conversion of high-occupancy-vehicle (HOV) lanes to high-occupancy toll (HOT) lanes on I-394 and I-35W in Minneapolis-St.Paul. In 2010, a second study was conducted to examine the concept of implementing dynamic pricing on shoulder lanes to provide additional capacity with minimal impacts and changes to the overall roadway footprint. These new MnPASS lanes would run parallel to general purpose lanes and require all vehicles except transit to pay tolls. Price would increase with volume to maintain free-flow conditions.

A sketch-level benefit-to-cost analysis was conducted to estimate system impacts. The analysis assumed that capital costs would be incurred by 2014, the system would be operational by 2015, and benefits would increase at a rate of 1.2 percent per year to match estimates for increased traffic demand.

Benefits included vehicle operating and maintenance benefits (calculated from the system VMT changes output from the travel demand model) and travel time savings (calculated from the system VHT changes from the model). Cost variables on each corridor included capital costs, operating and maintenance costs, and salvage costs. The capital cost, however, was the primary cost driver for the benefit-to-cost analysis. Benefits were primarily derived from travel time savings measured as the reduction in vehicle-hours traveled for both general purpose and managed lanes in each corridor.

The analysis included the following constraints and assumptions.
  • Auto Value of Time (per hour) = $13.59
  • Truck Value of Time (per hour) = $17.08
  • Auto Vehicle Operating Cost (per mile) = $0.26
  • Truck Vehicle Operation Cost (per mile) = $0.71
  • Vehicle Occupancy (per vehicle) = 1.35
  • Discount Factor = 2.9%
  • Inflation Rate = 3.0%
  • Evaluation Period = 20 years
  • Annual O&M Costs (toll collection and enforcement)= $50,000 per mile
  • Major Structures = 60 years
  • Grading and Drainage = 50 years
  • Sub-Base and Base = 40 years
  • Surface = 25 years

    FINDINGS

    Based on estimated system impacts and projected changes in travel demand over a 20 year period benefit-to-cost ratios ranged from 1.1 to 8.2 depending on corridor design. Longer corridors typically had higher benefit-to-cost ratios.

    The table below excerpted from the source report details the benefit-to-cost estimates for each corridor.

    Costs (2010 Dollars)
    Benefits
    Corridor
    Length
    Capital
    Annual
    Operating
    Salvage
    Total 20-
    Year Costs
    (Discounted)
    Time Savings
    (2015)
    Vehicle
    Operating
    Costs (2015)
    Total 20-Year
    Benefits
    (Discounted)
    B/C
    1A. TH 36: I-35W to I-35E
    5.0
    $47.5
    $0.25
    -$19.0
    $36.2
    $4.8
    -$0.3
    $67.4
    1.9
    2. I-94: TH 101 to I-494
    9.0
    $82.5
    $0.45
    -$30.1
    $64.4
    $5.0
    -$0.4
    $68.6
    1.1
    3A. I-35E:I-94 to TH 36
    3.9
    $82.5
    $0.20
    -$33.1
    $59.5
    $11.2
    -$0.5
    $158.5
    2.7
    3B. I-35E: TH 36 to CR E
    3.8
    $35.0
    $0.19
    -$13.3
    $27.1
    $3.0
    -$0.2
    $41.0
    1.5
    4A. I-35W: DT Minneapolis to TH 36
    5.3
    $105.0
    $0.27
    -$42.9
    $75.6
    $15.2
    -$1.1
    $209.6
    2.8
    4B. I-35W: TH 36 to Blaine
    10.8
    $155.0
    $0.54
    -$58.6
    $116.0
    $29.8
    -$1.5
    $420.1
    3.6
    5A. I-494: TH 212 to I-394
    7.6
    $97.5
    $0.38
    -$35.8
    $74.0
    $11.3
    -$1.1
    $151.3
    2.0
    5B. I-494: I-394 to I-94
    8.5
    $61.0
    $0.43
    -$27.1
    $46.4
    $15.0
    -$1.0
    $208.2
    4.5
    6A. TH 169: CR 17 to I-494
    10.0
    $97.5
    $0.50
    -$34.7
    $76.2
    $42.1
    $0.1
    $627.4
    8.2
    7. TH 77: 141st Street to Old Shakopee Rd
    6.9
    $41.0
    $0.35
    -$22.3
    $30.0
    $7.0
    -$0.2
    $101.7
    3.4
    10. I-494: TH 212 to MSP Airport
    10.6
    $167.5
    $0.53
    -$58.1
    $127.3
    $55,6
    -$2.1
    $795.8
    6.3
    2. I-94: TH 101 to I-494
    5B. I-494: I-394 to I-94
    17.5
    $192.5
    $0.88
    -$76.3
    $145.0
    $23.3
    -$1.8
    $319.8
    2.2
    1A. TH 36: I-35W to I-35E
    4B. I-35W: TH 36 to Blaine
    4A. I-35W: DT Minneapolis to TH 36
    21.1
    $377.5
    $1.06
    -$139.5
    280.6
    $54.1
    -$3.7
    $750.0
    2.7
    8A. I-94: DT Minneapolis to TH 280
    8B. I-94: TH 280 to DT St. Paul
    8.1
    $140.0
    $0.41
    -$69.5
    $95.3
    $25.9
    -$2.0
    $355.1
    3.7
    3A. I-35E: I-94 to TH 36
    3B. I-35E: TH 36 to CR E
    7.7
    $117.5
    $0.39
    -$38.3
    $86.6
    $14.0
    -$0.9
    $195.2
    2.2

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Source

MnPASS System Study Phase 2: Final Report

Published By: Minnesota DOT

Prepared by Cambridge Systematics for the MnDOT

Source Date: September 2010

URL: http://www.mnpass.org/pdfs/MnPassSystemStudy2.pdf

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Goal Areas

Productivity

Typical Deployment Locations

Metropolitan Areas

Keywords

congestion pricing, value pricing, variable road pricing, managed lanes

Benefit ID: 2011-00777