Office of Operations
21st Century Operations Using 21st Century Technologies

Operations Benefit/Cost Analysis Desk Reference



This document is disseminated under the sponsorship of the U.S. Department of Transportation in the interest of information exchange. The U.S. Government assumes no liability for the use of the information contained in this document. This report does not constitute a standard, specification, or regulation.

The U.S. Government does not endorse products or manufacturers. Trademarks or manufacturers' names may appear in this report only because they are considered essential to the objective of the document.

Quality Assurance Statement

The Federal Highway Administration (FHWA) provides high-quality information to serve Government, industry, and the public in a manner that promotes public understanding. Standards and policies are used to ensure and maximize the quality, objectivity, utility, and integrity of its information. FHWA periodically reviews quality issues and adjusts its programs and processes to ensure continuous quality improvement.

Technical Report Documentation Page

1. Report No.


2. Government Accession No.

3. Recipient’s Catalog No.

4. Title and Subtitle

Operations Benefit/Cost Analysis Desk Reference

5. Report Date

May 2012

6. Performing Organization Code

7. Author(s)

Doug Sallman, Erin Flanigan, Krista Jeannotte, Chris Hedden, and Dorothy Morallos – Cambridge Systematics, Inc.

8. Performing Organization Report No.

9. Performing Organization Name and Address

Cambridge Systematics, Inc.
555 12th Street, Suite 1600
Oakland, California 94607

10. Work Unit No. (TRAIS)

11. Contract or Grant No.


12. Sponsoring Agency Name and Address

U.S. Department of Transportation
Federal Highway Administration
Office of Operations (HOP)
1200 New Jersey Avenue, SE
Washington, DC 20590

13. Type of Report and Period Covered

Final Report
December 2009 to May 2012

14. Sponsoring Agency Code

15. Supplementary Notes

FHWA Contracting Officer's Technical Manager (COTM) Jim Hunt.

16. Abstract

This Desk Reference is intended to meet the needs of a wide range of practitioners looking to conduct benefit/cost analysis of operations strategies. The guidance provided in the Desk Reference includes basic background information on benefit/cost analysis, including basic terminology and concepts, intended to support the needs of practitioners just getting started with B/C analysis, who may be unfamiliar with the general process. Building off this primer base, the Desk Reference also describes some of the more complex analytical concepts and latest research in order to support more advanced analysts in conducting their analysis. Some of the more advanced topics include capturing the impacts of travel time reliability; assessing the synergistic effects of combining different strategies; and capturing the benefits and costs of supporting infrastructure, such as traffic surveillance and communications.

This Desk Reference is supported by an Operations B/C decision support tool, called the Tool for Operations Benefit/Cost (TOPS-BC). This spreadsheet-based tool is designed to assist practitioners in conducting benefit/cost analysis.

17. Key Words

Benefit/Cost Analysis; Cost Benefit Analysis; Economic Analysis; Transportation System Management and Operations; Operations Planning; Analysis Tools; Lifecycle Cost Analysis; Travel Time Reliability Analysis; Multiresolution/Multiscenario Analysis

18. Distribution Statement

No restrictions.

19. Security Classif. (of this report)


20. Security Classif.
(of this page)


21. No of Pages


22. Price


Form DOT F 1700.7 (8-72)            Reproduction of completed page authorized


The development of the Desk Reference and TOPS-BC was greatly aided by an Expert Review Panel that was formed to provide input and guidance to the project. This Expert Review Panel was comprised of individuals representing Federal, state, regional, and local transportation agencies, as well as research organizations. The Expert Panel has been invaluable in identifying areas of the greatest need for guidance on particular strategies, performance measures and other issues, and in reviewing the guidance materials and the TOPS-BC application. Members of the Expert Panel and other major contributors included:

Jim Allen (New Jersey DOT)

Sam Beydoun (Virginia DOT)

Rashmi Brewer (Minnesota DOT)

Jesse Buerk (Delaware Valley Regional Planning Council)

Mark Burris (Texas Transportation Institute)

Dong Chen (Florida DOT)

Jim Hogan (formally with New Jersey DOT)

Sarath Joshua (Maricopa Association of Governments)

Mena Lockwood (Virginia DOT)

Laurie Matkowski (Delaware Valley Regional Planning Council)

Andrew Meese (Metro Washington Council of Governments)

Dennis Motiani (New Jersey DOT)

Zoe Neaderland (Delaware Valley Regional Planning Council)

Matthew Neeley (Washington State DOT)

Keith Nichols (Hampton Roads Planning District Commission)

Barry Padilla (Caltrans)

Jason Sims (Kansas City SCOUT)

John Shaw (formally with Wisconsin DOT)

Todd Szymkowski (University of Wisconsin/Wisconsin DOT)

Valentin Vulov (Georgia Regional Transportation Authority)

John Wolf (Caltrans)

David Zavattero (City of Chicago)

Office of Operations