01024722

Component

The use of intelligent transportation systems (ITS) is increasing as further attempts are made to alleviate traffic problems by means other than expanding the physical capacity and size of roadways. ITS field trials have demonstrated various benefits associated with individual applications and integrated systems. However, few agencies have considered the option of leasing the ITS applications and therefore no guidance or framework exists to evaluate the purchase/lease options. This paper presents and tests a methodology to analyze ITS investment strategies. A number of economic evaluation frameworks and criteria were considered. Of the considered criteria, the net present value (NPV) criterion was selected and, in particular, life cycle cost analysis (LCCA) was determined to be the most relevant evaluation method. The LCCA method was tested for a case study and was shown to provide relevant and meaningful results. Overall, it is believed that the LCCA methodology is the most valid for comparing investment alternatives. Finally, in order to fully assess which investment option is preferred, it was determined that the analyst must know or be able to estimate what the anticipated usage of the ITS application(s) will be in the future. This paper was written and submitted as credit for an asset management graduate course at the University of Calgary during the 2005/2006 academic year. In the Fall 2005 term, an asset management reading course introduced and discussed the concepts of asset management. A pavement management course in the Winter 2006 term introduced more specific pavement management concepts and economic evaluation tools, which can be extrapolated to other asset classes. This paper represents the combination of concepts and information provided in the asset management reading course and introduced in the pavement management course.

01020180

06-0574

English

17p

2006

Transportation Research Board 85th Annual Meeting

CD-ROM

References (10) ; Tables (3)

Alternatives analysis; Asset management; Economic analysis; Evaluation; Future; Intelligent transportation systems; Investments; ITS program applications; Leasing; Life cycle costing; Pavement management systems; Purchasing; Strategic planning; Utilization

Net present value

Economics; Finance; Freight Transportation; Highways; Operations and Traffic Management; Pavements; Planning and Forecasting; Research; Society; I10: Economics and Administration; I72: Traffic and Transport Planning

Transportation Research Board Annual Meeting 2006 Paper #06-0574

TRIS, TRB

Mar 3 2006 10:23AM