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Center Identification Number:  77704    


Project Title:  Economics of Transportation Demand Management (TDM)   


Co-Principal Investigators:


Sisinnio Concas, Senior Research Associate
Phone: (813) 974-7760


Victoria Perk, Senior Research Associate
Phone: (813) 974-7327




Center for Urban Transportation Research

University of South Florida

Fax: 813-974-5168


External Project Contact:     


Michael Wright

Public Transportation Office / Transit Planning





I.  Project Objective/Problem Statement

The 1993 FHWA report cited some analysis termed the “Economics of TDM.” It estimated that employers spend about $1.33 to reduce a one-way vehicle trip (SOV commute trip), while it would cost government $6.75 to accommodate each commute trip with new highway capacity (COMSIS Corp., Implementing Effective TDM Measures, prepared for the USDOT, DOT Report DOT-T-94-02, September 1993, p 3-110..). These findings were used in some urban areas to argue for increased public funding to support employer TDM programs and provide incentives for the use of alternative modes. Other analyses assess the return on the investment. For example, the Washington State Commute Trip Reduction program revealed that the state was getting $12 in private sector investment in employer trip reduction programs for every state dollar spent. While there are many ways to assess and present the results of benefit/cost analyses, experience in California with measuring the cost per unit of reduction (trip, mile and pollution) and comparing this to a range of experience has allowed local programs to benchmark the programs to assess their cost effectiveness and defend the program to policy-makers and other funders. Some of these comparisons formed the core of the cost effectiveness evaluation performed as part of TRB Special Report 264, whereby various trip and emission reduction strategies were compared on a cost per pound of pollutants reduced. That analysis revealed that disproportionate amount of funds were being spent on projects and strategies that were the least cost effective (Transportation Research Board, The Congestion Mitigation Air Quality Improvement Program: Assessing Ten Years of Experience, Special Report 264, National Academies, 2002.). Others are looking at the economics of TDM as a means of addressing capacity needs. Washington State DOT is experimenting with a market-based approach whereby WSDOT “pays for performance” by buying down capacity needs at $2 per daily trip reduced. This NCTR project would seek to develop a standardized methodology for calculating the costs and impacts. It would require a review of these comparative cost effectiveness assessments. This type of comparison can be very powerful in informing the decision-making process.

II.  Objectives/Tasks

The proposed scope of services for this project consists of two phases, each subdivided into the following tasks.

Phase 1: A Comparative Assessment of Currently Employed Benefit to Cost (B/C) Analyses

Task 1: Literature Review/Peer Panel

A collection of studies that examine TDM initiatives will be identified, with a focus on evaluation and assessment methods. This will include identification of cost-effectiveness evaluations such as TRB Special Report 264. In addition to the standard TRIS search and a review of the many industry periodicals kept at CUTR, a search will be made of the internet for articles and other references. In addition, a peer panel consisting of up to four external reviewers will be formed to provide feedback during the course of the project.

Task 2: Comparative Assessment of Current Practices

A comparative analysis of studies found in Task 1 will be conducted. Assumptions, methods, metrics, and data requirements best-suited for aggregation will be identified, as well as any shortcomings and constraints (the accuracy of benefit/cost analysis depends on the criteria and assumptions used in evaluation).

Phase 2: Development of a Life-Cycle Cost Analysis Evaluation Tool for TDM

Task 3: Model Development

A sketch planning evaluation tool will be developed that is easy to implement and transferable across platforms and users. The approach will outline the minimum input data requirements. It is anticipated that the evaluation methodology will incorporate elements of B/C and life cycle cost analysis, which will provide a set of standard guidelines that can be adopted by agencies throughout the country.

Task 4: Model Validation/Implementation

The model will be run and analyzed on a set of examples/studies to evaluate and refine the approach. The validation approach will be developed with input from the project peer panel.

Task 5: Final Report

The final report will summarize all tasks and will also include supporting documentation for the use of the model.

III. Deliverables

Progress Reports. Progress Reports will be submitted on a quarterly basis to the Research Center for processing.

Final Report. Twelve (12) hard copies of the final report, one (1) electronic version of the final (Word), and one (1) electronic version of the summary (Word) will be provided to the Research Office.

Other deliverables include

• Technical Memorandum Number One: Summary of Tasks 1 and 2
• Life-Cycle Cost Analysis Evaluation Tool for TDM
• Final Report


IV.  Project Schedule


RESEARCH 1 2 3 4 5 6 7 8 9 10 11 12 13
Task 1 2 2     1 1 1 1 1 1 1 1 1
Literature Review/

Peer Panel

25% 50% 75% 100%                  
Task 2       2       1 1 1 1 1 1
Comparative Assessment of Current Practices       25% 50% 75% 100%            
Task 3 1 1 1               1 1 1
Model Development


        17% 33% 50% 67% 83% 100%      
Task 4 1 1 1 1 1 1 1            
Model Validation/ Implementation                 33% 67% 100%    
Task 5 1 1 1 1 1 1 1 1 1   2 2 2
Final Report


                  25% 50% 75% 100%


V.  Project Budget


Economics of Transportation Demand Management (TDM)

Budget Categories


Center Director Salary


Faculty Salaries

$ 65,402

Admin. Staff Salaries

$     742

Other Staff Salaries


Student Salaries


Staff Benefits

$ 28,588

Total Salaries and Benefits

$ 94,732



Permanent Equipment


Expendable Property/Supplies

$      507

Domestic Travel


Foreign Travel


Other Direct Costs


Total Direct Costs

$ 95,238

Indirect Costs

$   4,762

Total Costs



Notes: This budget does not reflect any federal participation. The project team will include faculty, students, and secretarial and other support staff who will work directly on the project and whose costs are reflected in the direct costs of the project as listed above. Budget requests includes salaries for clerical and administrative staff, postage, telephone calls, office supplies, general purpose software, subscriptions, and/or memberships.


VI. Equipment

No equipment is envisioned to be purchased under this project.

VII. Travel

No travel expected to be necessary for this project.

VIII. Implementation

The result of this project will be a sketch planning evaluation tool for TDM that can be used by the FDOT and other transportation professionals.

IX. Student Involvement

Graduate students will be used to acquire data as necessary and to assist in the production of the draft and final versions of the report.

X. Relationship to Other Research Projects

A NCTR project entitled Impact of Employer-Based Programs on Transit System Ridership and Transportation System Performance may provide information and resources that can assist in the completion of this project.

XI. Technology Transfer Activities/Peer Review

The results of this project will be a sketch planning analysis tool that will be distributed and available via NCTR web sites, with final reports to the FDOT, and USDOT Office of Research and Special Programs Administration.

XII. Potential Benefits of the Project

The comparative assessment and model development will help program managers and funders make informed decisions on where to spend finite transportation and air quality dollars.

The key strength of this approach is to provide a set of standard guidelines that can be adopted by agencies throughout the country. Needless to say, when significant funds are at stake, the accuracy, and more importantly the perceived fairness of the comparison are critical. The report will summarize the comparisons made to date to help some regions who would opt to use national research findings, develop a standardize approach to calculating the inputs to the comparisons along with worksheets, and guidance on how to collect the information needed for the calculations.

XIII. TRB Keywords

Travel demand management, performance measures, sketch planning planning tools, cost-benefit analysis, program evaluation




National Center for Transit Research · at the Center For Urban Transportation Research · University of South Florida · 4202 E. Fowler Ave., CUT100 · Tampa, FL 33620-5375 · (813) 974-3120 · (813) 974-5168 · · Comments: