Project Objectives
Applied Research Associates, Inc. (ARA) was retained by Transport Canada to estimate the annualized unit costs by functional class of road for Canadian road infrastructure. The cost estimates should reflect the existing service levels and utilize existing practice of design, construction, rehabilitation, and maintenance of road infrastructure. The cost estimates are to represent all federal, provincial and territorial highways, and selected municipal roads.
The project included two additional tasks:
A/ Identification and classification of Canadian road infrastructure by functional class of the road.
Road inventory is to be reported separately for each province or territory, jurisdiction within the province or territory (federal, provincial/territorial, and municipal), by road design features (rural or urban), and by functional class of road.
B/ Estimation of traffic volumes on the road network identified and classified in the course of Task A.
The two additional tasks can be viewed as separate tasks because the estimation of annualized unit road costs is independent of the actual extent of the road infrastructure inventory, and to some extent, of the actual traffic using the infrastructure. For example, it is possible to estimate the total annualized costs (per one-km-long single traffic lane) of an arterial municipal road with urban design features in Ontario without knowing the total length of such roads in Ontario.
Background
The work described in this report is part of a project on the Investigation of the Full Cost of
Transportation. The project was initiated by Transport Canada in collaboration with Provincial and Territorial transportation agencies and is steered by a Task Force reporting to the Policy and Planning Support Committee of the Council of Deputy Ministers Responsible for Transportation and Highway Safety.
The final report for the project Estimation of the Representative Annualized Capital and Maintenance Costs of Roads by Functional Class was issued on March 31, 2006. Subsequently, in 2007,
representatives of two provinces, Québec and Saskatchewan, have provided additional, more accurate data for the estimation of road costs. Technical experts from Québec also directly worked with the road cost estimation model, updated several model input values for Québec, and compared the updated road costs for Québec with the costs estimated for other provinces.
In order to discuss and improve road cost estimates provided in the March 31, 2006 final report, the Economic Analysis Directorate of Transport Canada has invited the representatives of all Provinces to attend a Technical Workshop on Road Cost Estimation Methodology in Ottawa in March 2008. The Workshop was attended by the representatives of four provinces (Newfoundland, Québec, Ontario, and Manitoba). During the workshop, the cost estimation methodology and the unit costs and quantities of all main infrastructure components were reviewed and discussed. The workshop resulted in a number of recommendations and suggestions on improving the cost estimates contained in the final report of March 31, 2006
Revised Final Report
This is a revised final report which supersedes the final report dated March 31, 2006. Compared to the previous report, this revised report incorporates changes based on comments received from several provincial transportation agencies in 2007 and 2008. The main difference between the revised final report and the previous report concerns improvements in the input data used in the computational model.
Considering the extent of additional data provided and the number of recommendations and suggestions received during the March 2008 workshop, the decision was made to revise the final report of March 31, 2006 by issuing the revised final report. Both reports (the revised final report and the previous final report), have the same main title – Estimation of the Representative Annualized Capital and Maintenance Costs of Roads by Functional Class.
The revised computational model includes changes in the input data and improved descriptive labels and legends to make the model spreadsheets self-explanatory. The revised computational model does not include any changes to the structure of the model or to computational procedures.
The revised computational model contains the following changes in input data:
Initial pavement structure. Examples of changes in input data concerning the initial pavement structure include a reduction of the thickness of asphalt concrete layers in Newfoundland, extensive changes in the initial pavement structure of provincial roads in Québec, changing the surface type of provincial rural roads in Northern Ontario from hot mix asphalt concrete to surface treatment, addition of tack coat as a specific construction activity for Ontario pavements, and changing the pavement surface type of municipal rural collector roads in Saskatchewan from hot-mix asphalt concrete to gravel.
Pavement preservation action plans. The changes in the initial pavement structure often required corresponding changes in the subsequent pavement maintenance and rehabilitation plans. There were additional changes in pavement preservation action plans in Québec, Ontario, and Saskatchewan.
Unit construction costs. Virtually all changes in the unit construction costs occurred in Québec. The changes concerned the unit costs for constructing and maintaining pavements, bridges, and all other infrastructure components.
Geometric road design parameters. The changes in geometric road design parameters included the width of pavement and the width of paved and unpaved shoulders. The majority of changes occurred in Québec and Saskatchewan.
Compared to the previous report, the revised final report includes many updated tables that reflect the changes in the input data, text changes corresponding to the changes in input data, improvements in the description of the computational model, and several editorial changes.
Reliability of the Representative Cost Estimates
The cost estimation methodology utilizes many small elements of verifiable data. For example, in the case of the initial pavement costs, the specific data elements identify thickness, width, type, and unit cost of the surface layer on a provincial rural collector road in Northern Ontario. Because the total cost estimation is based on hundreds of data elements (in terms of quantities and unit costs), the total cost estimates should remain reliable even if the estimates for some of the data elements are off. All estimated data elements are identified in the model and can be changed by the user (e.g., if better estimates become available). It is easy for anybody with the basic knowledge of Excel to change input data and re-run the
cost estimation model. Consequently, annualized unit cost estimates can easily be updated using the procedures outlined in the report.
The results presented in this report are based on the information and data available at the end of 2005.
Unit construction costs used in the computational model are from 2003. Road infrastructure inventory data are for the most recent year for which data were available, typically for 2004. Traffic characteristics (traffic volumes for cars and commercial vehicles) are typically for year 2003 or for the most recent year for which data were available.
The interpretation of the validity of annualized cost estimates must consider limitations of the input data and assumptions inherent in the computational model. The interpretation of the annualized cost estimates for different road infrastructure components, and particularly the comparison of the annualized cost estimates reported for different jurisdictions, must take into account the average representative nature of the cost estimates. Specific considerations should include the following:
• The average costs used for the estimates may not properly reflect high manpower and equipment mobilization costs at remote locations.
• Construction costs are subject to ongoing significant changes.
• Unit construction and maintenance costs reported by some jurisdictions may not include all relevant expenditures, for example capital cost of heavy equipment and storage facilities.
• The estimation of many construction quantities are speculative and are based on engineering judgement only. Examples include the amount and type of the excavated material required to build a roadbed, or the amount of guide rails per unit road length.
• Differences in the physical characteristics of road functional classes used by different jurisdictions. For example, an arterial road in a province with a low population may have different geometric design characteristics than an arterial road in southern Ontario.
The report also provides a comparison of the estimated annualized representative costs (obtained by the computational model) with the annual expenditures reported by the provincial transportation agencies.
The results of such comparisons must be interpreted with caution. In addition to the limitations associated with the estimated annualized costs enumerated above, the results of the comparison also depend on:
• The accounting and reporting procedures employed by the provincial transportation agencies.
Provincial agencies do not employ a common accounting methodology defining of the type of costs (e.g., capital costs, maintenance and rehabilitation costs, administrative and overhead costs). Consequently, for example, the comparison of maintenance costs estimated by the model with those reported by many transportation agencies would be misleading if the definition of the maintenance costs differs.
• Road lengths. Total estimated annualized costs depend on assumed size of the road infrastructure. The size of infrastructure assumed by the model and by the transportation agencies may differ.
Report Organization
The report consists of 12 primary chapters, five appendices, an addendum, and an MS Excel®-based computational model. All chapters, appendices and the addendum are also available electronically.
Because of the large amount of data constituting the results of this project, most of the project results are given in the appendices. Information concerning provincial and municipal surveys is presented in
Appendix A and B. Results concerning road inventory and traffic data are given in Appendix C; results concerning annualized unit costs by functional class of road are given in Appendix E.
The computational model is a separate electronic document that can be accessed using Microsoft Excel.
The computational model, and its user guide, are described in Chapter 9. Appendix D provides a print-out of the main worksheets of the computational model.
The Addendum contains 196 Road Construction Sheets that provide detailed information on the geometric and physical features of all 196 road segments included in the study.