Economics in Asset Management
The New York Experience

Moving Ahead

Network-Level TAM Tradeoff Model

The TAM Tradeoff Model is currently operating as a prototype. NYSDOT is considering several potential revisions and improvements to the model:

• The threshold values of condition and performance at which unit user costs are judged to be excessive are under review. For example, International Roughness Index values greater than 101 inches per mile on flexible pavement and 136 inches per mile on rigid pavement generate excess user costs in the prototype model. If these thresholds are too high relative to thresholds for other asset classes, pavement investments will be less attractive.
• The unit user costs for crashes, vehicle operating costs, and hours of travel time for moving people and goods need to be standardized across all program-and project-level tools that have a direct relationship to the trade-off model. The same is true for other values such as treatment service life and the discount rate.

The benefits of properly timed infrastructure preventative and corrective maintenance, as contrasted with postponing needed work, should be considered in addition to saved user cost.

• The benefits of properly timed infrastructure preventative and corrective maintenance, as contrasted with postponing needed work, should be considered in addition to saved user cost. This could be implemented by an "avoided agency costs" logic that reflects the increasing cost of work required to restore infrastructure to a state of good repair as more and more deterioration takes its toll. These costs would be discounted to an equivalent present worth amount and then annualized to be applicable to the prototype tradeoff model logic.
• Policy makers need the capability to conduct sensitivity analysis on tradeoffs among the various program areas by varying economic values.
• Demographic and economic impact data from files such as the Census will be added to the system.

Project-Level Economic Analysis

The TAM model provides program level assessments of investment priorities. Detailed benefit-cost analysis, based on site-specific data, is required for reliable project-level economic evaluations.

To accommodate the need for project-level evaluations, NYSDOT continues to improve its economic tools. It will replace its current pavement LCCA tools with a customized version of RealCost, FHWA's project-level, computerized spreadsheet for LCCA. NYSDOT also is carefully evaluating use of the National Cooperative Highway Research Program Report 483 bridge LCCA software as a part of bridge project scoping. These methods emphasize the evaluation of alternative construction delivery methods; maintenance and protection of traffic alternatives; and project scoping alternatives.