"ute Saved Rather than Cost per Mile is a Better Benchmarking Metric for Toll Roads

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johokanoc
"ute Saved Rather than Cost per Mile is a Better Benchmarking Metric for Toll Roads

Love this:

“This is like bench- marking restaurant cuisine simply by comparing the kitchen floorspace. It conveys nothing about demand, or the consumer utility derived from goods and services. “

From: on behalf of Rob Bain
Date: Tuesday, August 23, 2022 at 6:13 AM
To: TMIP
Subject: Re: [TMIP] Reminder - Why Cost per Minute Saved Rather than Cost per Mile is a Better Benchmarking Metric for Toll Roads

Hi everybody

In late July we ran a TMIP Seminar examining flaws in the cost per mile benchmarking metric used throughout the toll road industry (see description below). At that time, we were still writing-up our research and results.

Our paper has now been published. Several list subscribers (who missed the Seminar) contacted us in this regard. FYI, the research paper ('It's About Time') can be downloaded, free of charge, from:

http://www.robbain.com/articlesandpapers.htm

Kind regards,

Rob

Robert Bain
RBconsult Ltd
www.robbain.com
Honorary Professor
University College London
r.bain@ucl.ac.uk

NOTICE OF CONFIDENTIALITY. This communication is intended only for the use of the addressee and may contain confidential and privileged information. If you are not the intended recipient, you are notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please notify the sender immediately or, alternatively, immediately destroy this communication.

From: sarah.sun=dot.gov@mg.tmip.org On Behalf Of sarah.sun@dot.gov
Sent: 21 July 2022 13:19
To: TMIP
Subject: [TMIP] Reminder - Why Cost per Minute Saved Rather than Cost per Mile is a Better Benchmarking Metric for Toll Roads

Please join us on July 25, 2022 at 10:30 AM EST for a TMIP Web Knowledge and Information Exchange Session: Why Cost per Minute Saved Rather than Cost per Mile is a Better Benchmarking Metric for Toll Roads - A Value for Money Review of Toll Bridges & Tunnels Across the United States.

Meeting Information
Please register in advance for this webinar at: https://usdot.zoomgov.com/webinar/register/WN_bkIijmFvSAyFQxr9vB0C1Q

Please note: there will be no recording for the session.

Session Description
A standard benchmarking metric employed for comparative analysis in the toll industry is cost per mile. It's supposed to reflect attractiveness to the consumer. All things being equal, policy-makers, planners, investors and the public prefer low cost per mile projects.

Cost per mile is easily calculated but, as a benchmark of value it is flawed. It is an engineering metric that focuses solely on project length and toll prices. As such it is a misleading indicator that fails to take account of utility or the consumer experience. Drivers value travel time savings, not distance travelled.

As investment analysts (working for a number of the leading infrastructure investors in the world) we - and they - prefer cost per minute saved. We come across many rankings of projects by cost per mile but, until now, we have never seen rankings by cost per minute saved. In this webinar we explain how we looked at all the toll bridges and tunnels across the United States and evaluated them in terms of value to the consumer (cost per minute saved).

The session concludes with a summary of our findings and practical recommendations for industry professionals.

Presenters
Robert Bain is based in London. He was a transportation modeller for over 20 years before joining the Infrastructure Finance Ratings team at Standard & Poor's. Today, with his colleague Sylvain Senechal, he conducts commercial due diligence on candidate investments in the road and rail sectors for many of the world's leading infrastructure investors. Robert lectures at University College London where he is an Honorary Professor.

Sylvain Senechal is based in Ottawa. He led the research team at Brookfield - one of the world's largest alternative asset managers - before joining forces with Robert and providing consulting services to infrastructure investors. Sylvain holds an MBA from National Chengchi University and is a CFA charterholder.

Contact Us

If you would like to work with TMIP to share your agency's experience or if you have questions or comments about TMIP, please contact Sarah Sun, FHWA.

We are committed to providing equal access to TMIP Webinars for everyone. If you need alternative formats or other reasonable accommodations, please send an e-mail to moderator@tmip.org with your request. We will respond to your request within 24 hours.

DISCLAIMER: The views and opinions expressed during this webinar are those of the presenters and do not represent the official policy or position of FHWA and do not constitute an endorsement, recommendation, or specification by FHWA. The webinar is based solely on the professional opinions and experience of the presenters and is made available for information and experience sharing purposes only.
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