Asset Management

Asset Management and Management of Highway Performance (Peer Exchange)

3.0 Peer Exchange Discussions

The original intent of the peer exchange was to focus on the technical details of performance measures and the target-setting process. However, given the potential implications of a performance-based program in terms of agency accountability and the allocation of transportation resources, the discussions quickly moved to broader policy-level issues. Several overarching themes emerged from these discussions:

• There is an important distinction between performance-driven decisions and performance-influenced decisions. Performance measures are not the end result. The end result is the ability to show that transportation investments decisions are being made with an understanding of their implications on system performance and established goals. This is a critical point because it underscores the importance of the transportation planning and programming process as the vehicle to deliver on desired outcomes.
• When establishing performance measures and targets, it is important to be clear about which portions of the network (Interstate, NHS, functional class, etc.) are being reported on and which will be considered in target setting. An important first step in the development of a national performance management framework is to identify those assets that are of national importance.
• Establishing a national performance-based program must take into account the differences between the nation's urban and rural areas. Each area may require a unique set of performance measures and/or targets.
• The needs of each state differ and are evolving (e.g., growth versus maintenance). An alternative to holding all states accountable for achieving the same targets, is to require them to develop investment strategies that can be shown to be consistent with national goals, and then to hold them accountable for implementing the agreed-upon strategies. The states participating in the peer exchange felt that this approach would help alleviate many of the concerns and challenges described below.

3.1 Pavement Performance Measures

Pavement ride quality, as measured by the International Roughness Index (IRI), is the only measure of pavement condition collected by all state DOTs. Given its commonality, IRI is a logical first choice for measuring and reporting pavement performance. However peer exchange participants discussed two significant issues with the use of IRI as a national performance measure - inconsistency in how IRI data are collected and an inability for IRI to be used to understand the overall structural condition of a pavement.

Within a given agency, the participants felt that measurements of IRI tend to be consistent. (A contrasting example was provided the Maryland DOT, which saw overall IRI improve after it purchased a new data collection vehicle.) However they felt that there is less consistency in IRI among state agencies. Examples of sources of discrepancies cited include the use of different equipment to collect IRI data, and different protocols regarding which portions of the highway to included in the measurements (e.g., some states include bridge approaches, others do not). Tightening HPMS reporting requirements over time may help to improve consistency and comparability among states. Given current comparability issues, however, there was discussion on the appropriate data used to measure pavement performance. For example, no consensus was reached on whether pavement performance data should come from the national HPMS database or from state pavement management systems.

The participants agreed that ride quality does not provide a complete picture of pavement condition. They suggested that a measure of structurally adequacy in addition to ride quality would provide a more comprehensive assessment of pavement performance. However, there is no common or consistent measure of structural adequacy used by state DOTs. Some states measure present serviceability (PSR), while others measure remaining service life or combine structural adequacy and ride quality into a single overall measure. Regardless of which performance measures are used to report on pavements, the participants agreed that decisions on pavement investments should be based on the best technical data available, which will vary among states.

3.2 Bridge Performance Measures

Structural deficiency is the most common measure used for reporting bridge condition. The SCOPM Preservation Task Force has recommended percent of structurally deficient bridges, weighted by deck area as a common measure. Unlike many of the other goal areas, the data required to report this is readily available from the National Bridge Inventory (NBI) database.

The peer exchange participants provided the following recommendations regarding the measurement of bridge condition:

• Expand beyond percent structural deficiency bridges and use a measure that helps to identify deteriorating bridges before they become deficient. Having two thresholds (for example, those required to define the boundary between good, fair, and poor) would allow agencies to develop strategies that combine preventive maintenance, rehabilitation, and reconstruction.
• Consider two measures of structural deficiency - one that includes bridges that are structurally defi­cient solely because of their deck rating and one that does not. The use of two measures reflects the fact that bridges that are deficient because of deck area may have a lower priority than bridges with superstructure or substructure deficiencies.
• In calculating the measure, do not include bridges that are structurally deficient because of their deck rating. This would reflect the fact that bridges that are deficient because of deck area should have a lower priority than bridges with superstructure or substructure deficiencies.
• In addition to percent structurally deficient bridges weighted by deck area, consider adding a count of fracture critical bridges as a measure. This measure would result in a different prioritization of bridges then an approach that considered only structural deficiency.

3.3 Pavement and Bridge Targets

Defining performance targets is a key step in establishing a performance-based Federal-Aid Highway Program. The peer exchange participants discussed a variety of challenges and offered potential solutions to establishing performance targets for pavements and bridges.

What Should Be the Relationship between National and State Targets?

The discussion of performance targets focused largely on who should be responsible for setting the targets. Should targets be legislated by Congress, set nationally by the U.S. DOT, or individualized by state? While no resolution was reached on this issue, there was significant discussion around the following approach:

• Establish national goals;
• Require states to establish targets and develop an investment strategy for achieving them;
• Require states to illustrate how the investment strategy will help achieve the national goals; and
• Hold states accountable for implementing the strategy.

This approach would place emphasis on a performance-based process (or investment strategy) rather then on specific target values. In the context of preservation, an investment strategy might include the amount of money that will be spent on preventive maintenance, rehabilitation, and reconstruction activities over the next six years. Participants discussed how Strategic Highway Safety Plans could be used a model for other goal areas such as pavement and bridge preservation. They noted similarities between these plans and the approach described above.

What Part of the System Should Be Included in the Targets?

Establishing appropriate national targets requires a recognition of which part of the system is truly in the national interest. Participants suggested that the national highway system (NHS) represents the country's core assets. They also noted that establishing targets for facilities beyond those determined to be of national interest would increase the number of local agencies required to be involved in the target setting and resource allocation discussions, therefore complicating the process. Participants also discussed the potential for targets to vary by highway function or by geography. For example, some states assign higher priorities to roadway that serve as school routes, truck routes or evacuation routes; and establish different performance standards for urban and rural areas.

Should Targets Be Based on Trends or Specific Thresholds?

Participants discussed the use of "percent improvement" as the basis for performance targets, with the idea that every year agencies should show steady improvement. However, several participants suggested that while this trend approach works well for safety, a threshold-oriented approach would be preferred for preservation. Establishing a common goal based on specific thresholds for good/fair/poor would provide agencies with the option to maintain a steady state once an adequate level of performance was achieved. It was noted that not all states would need or want to increase the condition of their pavement or bridges after achieving a minimum threshold. In addition, agencies would be less justified in increasing targets once customers are satisfied with the current condition.

How Should Targets Be Used?

Peer exchange participants noted that performance targets hold significant promise for helping agencies communicate what can and can not be accomplished with existing funding levels. They also discussed how targets could be used to help the public and elected officials understand the implications of increasing or decreasing transportation budgets.

However, the participants raised several concerns regarding the potential use of performance targets to influence the allocation of Federal funds. For example, they discussed the importance of equity considerations, and noted potential similarities to previous donor state disputes. They also discussed the potential for unintended consequences such as rewarding agencies that perform poorly. Finally, they noted that additional data improvements and greater confidence in technical models would be needed if targets were to be used as the basis for accountability and funding allocation.

3.4 Measuring Performance in Other Goal Areas

Safety

Similar to highway preservation, performance measurement in the safety area is more advanced than the other goal areas. Participants noted that in preparing the required Strategic Highway Safety Plan (SHSP), all states have moved toward a performance-based approach by developing goals and performance measures related to safety. AASHTO's Standing Committee on Highway Traffic and Safety has developed 14 specific safety categories with measures and targets. AASHTO's SCOPM Safety Task Force has recommended annual fatalities as an appropriate performance measure for assigning a national goal and target.

Based on their earlier discussions related to pavement and bridge performance, peer exchange participants identified the following recommendations for establishing safety performance measures:

• Less is more. The international scan found that many safety programs started out very prescriptive, but were relaxed over time. Participants felt a small set of measures would improve the overall success of a performance-based program.
• Acknowledge differences among the states.AASHTO will soon be releasing a comparative study of safety in all 50 states. The report highlights differences in state laws, organization structures, and legislative requirements related to safety. Given these differences and the fact that each state would be starting from a different performance baseline, participants suggested that all states should not be held to the same short-term targets.

Congestion

The SCOPM Congestion Task Force has found identifying and building consensus on a set of performance measures to be difficult. Based on the earlier pavement and bridge discussions, participants offered the following recommendations for the congestion goal area:

• Start by defining which portion of the system is covered. In establishing the scope of congestion measures, participants noted to the need to consider data and technical capabilities. For example, evaluating congestion on key Interstate corridors would be easier than evaluating congestion on NHS local connectors. They also noted that congestion is a very different issue in urban areas then in rural areas.
• Provide for flexibility in defining measures.Participants noted that no two states measure and report congestion the same way. States have varying definitions of congestion, standards on what is acceptable, and motivations for improving or not improving their congestion levels. Therefore, they discussed the potential to use agency-specific measures, rather than look for common national measures.
• Consider moving away from national targets.Participants discussed the potential of considering congestion performance at the regional or local level rather then at a national level. They also discussed the idea of focusing on adherence to a performance-based congestion management process, rather than on the achievement of specific measure targets.
• Incorporate benefit/cost analysis. Participants discussed the importance of benefit/cost analysis in the congestion management process. They suggested that a performance-based congestion program should encourage agencies to identify projects that will provide the greatest value rather then focus on a worst-first approach.

System Operations

Although the systems operations goal area covers a wide range of activities and investments such as snow removal, incident management, and intelligent transportation systems (ITS), peer exchange participants noted that that Federal funds are spent primarily on ITS-related projects. As a result, they suggested that national measures for system operations focus on performance results that are affected by this type of investment. Furthermore, since ITS projects are aimed at congestion, some participants wondered if the systems operations goal area should be folded into the congestion goal area.

The participants also noted that Federal operations investments should be targeted to that part of the system that most influences the national interest, such as the Interstate system and/or NHS.

After discussing difficulties related to operations data and analysis (e.g., difficulties in calculating travel time reliability), the conversations focused on the potential for capital investment decisions for systems operations to be based more on benefit/cost analysis then specific performance measures. For example, before making decisions about where to invest capital operations funds, agencies could evaluate the costs and benefits of potential projects in a "Strategic Highway ITS Plan."

Environment

The candidate measures proposed by the SCOPM Environment Task Force include greenhouse gas emissions, climate change adaptation cost, and storm water runoff best practices. Peer exchange participants suggested that some measure of energy consumption be added to the list. They also discussed:

• A desire to keep environmental performance measures simple;
• The potential to focus on a performance-based environmental management process rather then specific performance targets;
• Difficulties in contributing green house gases to the appropriate source (e.g., vehicles or fixed industry); and
• A preference for sustainability measures that highlight the positive impacts. The Leadership in Energy and Environmental Design (LEED) program adopted by the U.S. Green Building Council was cited as an example of allocating credit for incorporating certain environmentally sustainable elements into a project.

Freight/Economics

The peer exchange participants discussed significant challenges in this goal area related to multimodal and multi-owner considerations. Similar to other goal areas, they noted the importance of benefit/cost analysis for improving national freight and economics performance.

The participants then commented on several of the candidate measures under consideration. For example, some felt that the measure related to heavy train track capacity would require an accurate system inventory that would be challenging to collect and maintain. Others suggested that border crossing time is more of a transportation security consideration than a transportation capacity issue, and may not be an appropriate freight performance measure. Finally, participants noted that while the goal area is labeled as "freight/economics" the candidate list of measures in Table 2.1 focus on freight, and suggested that the list be expanded to include other aspects of economic performance.

Summary of Lessons Learned from Pavements and Bridges

In summary, lessons learned from the discussions of pavement and bridge performance that can influence the discussion in other goal areas include:

• When it comes to performance measures, less is more;
• Clearly define the goals and objectives for any specific goal area before establishing performance measures and targets;
• Define which components of the highway system are in the national interest to identify where national targets may be appropriate;
• Understand data limitations and establish how/which data can be used to evaluate national performance;
• Allow for flexibility in how states implement measures;
• Explore further the role of benefit/cost analysis in improving national performance with limited resources; and
• Consider focusing on implementation of a performance-based strategy rather then achievement of specific targets as the basis for accountability.

3.5 Implications for Planning and Programming

The transportation planning and programming process is the critical mechanism for achieving desired system performance. In this way, performance measures and targets should be applied to make decisions and allocate resources at the programmatic level. The SCOPM Planning and Programming Task Force, with members of the Standing Committee on Planning, is working to define the key elements of performance-based planning and programming and begin to understand where states need to improve to achieve progress toward desired outcomes across goal areas. The Task Force is addressing questions such as:

• What is the outcome of the process - a list of projects, some other type of strategy, something else?
• Should both short- and long-term needs be considered?
• Does the current long-range transportation planning process allow for performance-based planning? If not, what must be done differently?
• How should agencies evaluate and prioritize projects that impact multiple goal areas and how can/should/will tradeoffs be made between goal areas?
• Do agencies have the tools and flexibility needed to evaluate transportation plans and programs to understand the outcomes of packages of investment decisions?
• Since the planning and programming process is tied to budget constraints, what agency targets are appropriate when revenues are uncertain?

Answering these types of questions and developing the definition of performance-based planning and programming will require coordination with the other SCOPM task forces, as well as with Federal, state, and local agencies. To advance the discussion in this area, FHWA and AASHTO are sponsoring a performance-based planning and programming executive round table to coincide with the 2009 AASHTO Annual Meeting.

3.6 Implementation

Peer exchange participants noted that moving transportation investment decision-making towards a performance-driven, outcome-based system will require a dramatic culture shift among implementing agencies at all levels. They also discussed that finding common ground in the general frustration of existing practices could help in building support for this type of change. For example, a performance-based approach could allow agencies to refocus on the projects and programs that matter most and de-politicize some day-to-day investment decisions. That said, the peer exchange discussions recognized that elected officials are ultimately responsible for transportation investment decision-making. Performance measures can and should influence these decisions, but they are not the sole driver of decisions.

Participants discussed the following three key challenges to implementation:

1. Tradeoff Analysis - What tools and techniques are available to help decision-makers evaluate and prioritize relative priorities between goal areas? Once the overall transportation budget is fixed, increasing performance in one area often requires decreasing it in another.
2. Consistency and Comparability - The lack of consistency and comparability among the states is a major hurdle for allocation formulas that aim to distribute Federal funds based on national performance measures and targets.
3. Data Management Systems - Greater confidence in data quality and analytical capabilities is required before agencies will be comfortable being held accountable for achieving specific targets.

They also discussed the importance of establishing a realistic timeframe for incremental implementation. It was noted that even if the process is not perfect at the outset, it is important to start somewhere and pledge to refine and expand over time. For example, documenting asset management processes would enable agencies to illustrate that they are taking an objective approach to decision-making, and that investments are being used in a manner that will lead to improved system performance. Strategic Highway Safety Plans were also cited as a good example of a performance-based program that is working. The transition to performance management occurs when agencies start making decisions that are informed by their implication on system performance. Peer exchange participants felt that currently, it is possible for agencies to take greater strides in the more advanced areas of preservation and safety, and that lessons learned in these goal areas can be applied to the others.

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