Interactions Between Transportation Capacity, Economic Systems, and Land Use (2012)

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Interactions Between Transportation Capacity, Economic Systems, and Land Use Economic DEvElopmEnt REsEaRch GRoup, inc. with icF intERnational, inc. cambRiDGE systEmatics, inc. WilbuR smith associatEs, inc. tExas a&m tRanspoRtation institutE susan JonEs mosEs anD associatEs T R A N S P O R TAT I O N R E S E A R C H B O A R D WASHINGTON, D.C. 2012 www.TRB.org The Second S T R A T E G I C H I G H W A Y R E S E A R C H P R O G R A M REPORT S2-C03-RR-1

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The Second Strategic Highway Research Program America’s highway system is critical to meeting the mobility and economic needs of local communities, regions, and the nation. Developments in research and technology—such as advanced materials, communications technology, new data collection tech- nologies, and human factors science—offer a new opportunity to improve the safety and reliability of this important national resource. Breakthrough resolution of significant transportation problems, however, requires concentrated resources over a short time frame. Reflecting this need, the second Strategic Highway Research Program (SHRP 2) has an intense, large-scale focus, inte- grates multiple fields of research and technology, and is fundamen- tally different from the broad, mission-oriented, discipline-based research programs that have been the mainstay of the highway research industry for half a century. The need for SHRP 2 was identified in TRB Special Report 260: Strategic Highway Research: Saving Lives, Reducing Conges- tion, Improving Quality of Life, published in 2001 and based on a study sponsored by Congress through the Transportation Equity Act for the 21st Century (TEA-21). SHRP 2, modeled after the first Strategic Highway Research Program, is a focused, time- constrained, management-driven program designed to comple- ment existing highway research programs. SHRP 2 focuses on applied research in four areas: Safety, to prevent or reduce the severity of highway crashes by understanding driver behavior; Renewal, to address the aging infrastructure through rapid design and construction methods that cause minimal disrup- tions and produce lasting facilities; Reliability, to reduce conges- tion through incident reduction, management, response, and mitigation; and Capacity, to integrate mobility, economic, envi- ronmental, and community needs in the planning and designing of new transportation capacity. SHRP 2 was authorized in August 2005 as part of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU). The program is managed by the Transportation Research Board (TRB) on behalf of the National Research Council (NRC). SHRP 2 is conducted under a memo- randum of understanding among the American Association of State Highway and Transportation Officials (AASHTO), the Fed- eral Highway Administration (FHWA), and the National Academy of Sciences, parent organization of TRB and NRC. The program provides for competitive, merit-based selection of research con- tractors; independent research project oversight; and dissemina- tion of research results. SHRP 2 Report S2-C03-RR-1 ISBN: 978-0-309-12932-9 Library of Congress Control Number: 2012949834 © 2012 National Academy of Sciences. All rights reserved. Copyright Information Authors herein are responsible for the authenticity of their materials and for obtaining written permissions from publishers or persons who own the copy- right to any previously published or copyrighted material used herein. The second Strategic Highway Research Program grants permission to repro- duce material in this publication for classroom and not-for-profit purposes. Permission is given with the understanding that none of the material will be used to imply TRB, AASHTO, or FHWA endorsement of a particular prod- uct, method, or practice. It is expected that those reproducing material in this document for educational and not-for-profit purposes will give appropriate acknowledgment of the source of any reprinted or reproduced material. For other uses of the material, request permission from SHRP 2. Note: SHRP 2 report numbers convey the program, focus area, project number, and publication format. Report numbers ending in “w” are published as web documents only. Notice The project that is the subject of this report was a part of the second Strategic Highway Research Program, conducted by the Transportation Research Board with the approval of the Governing Board of the National Research Council. The members of the technical committee selected to monitor this project and review this report were chosen for their special competencies and with regard for appropriate balance. The report was reviewed by the technical committee and accepted for publication according to procedures established and overseen by the Transportation Research Board and approved by the Governing Board of the National Research Council. The opinions and conclusions expressed or implied in this report are those of the researchers who performed the research and are not necessarily those of the Transportation Research Board, the National Research Council, or the program sponsors. The Transportation Research Board of the National Academies, the National Research Council, and the sponsors of the second Strategic Highway Research Program do not endorse products or manufacturers. Trade or manufacturers’ names appear herein solely because they are considered essential to the object of the report. SHRP 2 Reports Available by subscription and through the TRB online bookstore: www.TRB.org/bookstore Contact the TRB Business Office: 202-334-3213 More information about SHRP 2: www.TRB.org/SHRP2

The National Academy of Sciences is a private, nonprofit, self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the furtherance of science and technology and to their use for the general welfare. On the authority of the charter granted to it by Congress in 1863, the Academy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Ralph J. Cicerone is president of the National Academy of Sciences. The National Academy of Engineering was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages education and research, and recognizes the superior achieve- ments of engineers. Dr. Charles M. Vest is president of the National Academy of Engineering. The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters pertaining to the health of the public. The Institute acts under the responsibility given to the National Academy of Sciences by its congressional charter to be an adviser to the federal government and, on its own initiative, to identify issues of medical care, research, and education. Dr. Harvey V. Fineberg is president of the Institute of Medicine. The National Research Council was organized by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy’s purposes of furthering knowledge and advising the federal government. Functioning in accordance with general policies determined by the Academy, the Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the government, the public, and the scientific and engineering communities. The Council is administered jointly by both Academies and the Institute of Medicine. Dr. Ralph J. Cicerone and Dr. Charles M. Vest are chair and vice chair, respectively, of the National Research Council. The Transportation Research Board is one of six major divisions of the National Research Council. The mission of the Transportation Research Board is to provide leadership in transportation innovation and progress through research and information exchange, conducted within a setting that is objective, interdisci- plinary, and multimodal. The Board’s varied activities annually engage about 7,000 engineers, scientists, and other transportation researchers and practitioners from the public and private sectors and academia, all of whom contribute their expertise in the public interest. The program is supported by state transportation departments, federal agencies including the component administrations of the U.S. Department of Transporta- tion, and other organizations and individuals interested in the development of transportation. www.TRB.org www.national-academies.org

ACKNOWLEDGMENTS This work was sponsored by the Federal Highway Administration in cooperation with the American Asso- ciation of State Highway and Transportation Officials. It was conducted in the second Strategic Highway Research Program, which is administered by the Transportation Research Board of the National Acade- mies. The project was managed by David J. Plazak, Senior Program Officer for SHRP 2 Capacity. The research reported herein was conducted by a team composed of the Economic Development Research Group and subcontractors: Cambridge Systematics, Wilbur Smith Associates, Texas A&M Transportation Institute, ICF International, and Susan Jones Moses and Associates. The T-PICS (Transportation Project Impact Case Studies) database and web tool were designed and developed by the Economic Development Research Group and implemented by ICF International. The primary authors for this study were Glen Weisbrod, Steven Landau, Stephen Fitzroy, Margaret Collins, and Adam Winston of the Economic Development Research Group; Christopher Wornum of Cambridge Systematics; Paula Dowell and Eric McClellan of Wilbur Smith Associates; Sharada Vadali of the Texas A&M Transportation Institute; Jeff Ang-Olson, Sergio Ostria, Anjali Mahendra, and Stephen Ziegler of ICF Inter- national; Susan Jones Moses of Susan Jones Moses and Associates; and Rimon Rafiah of Economikr. SHRP 2 STAFF Neil F. Hawks, Director Ann M. Brach, Deputy Director Kizzy Anderson, Senior Program Assistant, Implementation Stephen Andrle, Chief Program Officer, Capacity James Bryant, Senior Program Officer, Renewal Mark Bush, Senior Program Officer, Renewal Kenneth Campbell, Chief Program Officer, Safety JoAnn Coleman, Senior Program Assistant, Capacity Eduardo Cusicanqui, Finance Officer Walter Diewald, Senior Program Officer, Safety Jerry DiMaggio, Implementation Coordinator Charles Fay, Senior Program Officer, Safety Carol Ford, Senior Program Assistant, Safety Elizabeth Forney, Assistant Editor Jo Allen Gause, Senior Program Officer, Capacity Abdelmename Hedhli, Visiting Professional James Hedlund, Special Consultant, Safety Coordination Ralph Hessian, Visiting Professional Andy Horosko, Special Consultant, Safety Field Data Collection William Hyman, Senior Program Officer, Reliability Linda Mason, Communications Officer Michael Miller, Senior Program Assistant, Reliability Gummada Murthy, Senior Program Officer, Reliability David Plazak, Senior Program Officer, Capacity and Reliability Monica Starnes, Senior Program Officer, Renewal Noreen Stevenson-Fenwick, Senior Program Assistant, Renewal Charles Taylor, Special Consultant, Renewal Onno Tool, Visiting Professional Dean Trackman, Managing Editor Pat Williams, Administrative Assistant Connie Woldu, Administrative Coordinator Patrick Zelinski, Communications Specialist Ann M. Brach Stephen J. Andrle, Deputy Director Neil J. Pe e , Deputy Director, Implementation a d C mmunications Kizzy Anderson, Senior Program Assistant, Implementation Kenneth Campbell, Chief Program Officer, Safety JoA n Cole an, Senior Program Assistant, Capacity and Reliability Eduardo Cusicanqui, Finance Officer Walter Diewald, Senior Program Officer, Safety Jerry DiMaggio, Implementation Coordinator Charles Fay, Senior Program Officer, Safety aro Ford, Senior Program Assistant, R newal and Safety Elizabeth Forney, Assist nt Editor Jo Allen Gause, Senior Program Officer, Capacity Abdelmen m H dhli, Visiting Professional Jam s Hedlund, Special Consultant, Safety Coordination Alyssa ernandez, Reports Coordinator Spec al Consulta t, Capacity and Reliability Michael Marazzi, Senior Editorial Assistant Linda Mason, Communications Officer Reena Mathews, Senior Prog am Officer, Capac ty and Reliability M tthew Miller, Program Officer, Capacity and Reliabil ty ichael Miller, Senior Program Assistant, Capacity and Reliability David Plazak, Se ior Program Officer, Capacity Monica Starnes, Sen or Program Officer, Renewal Charles Taylor, Special Consultant, Renewal Onno ool, Visiting Professional Dean Trackman, Managing Editor Pat Williams, Admin strative Assistant Connie Woldu, Administrative Coordin tor Patrick Zelinski, Communications Specialist

The Capacity focus area of the second Strategic Highway Research Program (SHRP 2) is broadly based on the concept that better consideration of the social, environmental, and economic effects of highway projects as they are planned, programmed, and carried out will result in improved and more rapidly implemented projects. Capacity Project C03 was designed to create a large database of case studies and a web-based tool that allow for more rapid assessment of the long-term economic impacts of highway capacity projects. The main result of the project is that economic impacts can be considered for a greater number of potential projects, and this step can take place earlier in the planning process. Although there are many excellent economic impact assessment tools for highway capacity planning, they tend to be relatively time consuming and expensive to use. This has meant that the economic impacts of potential projects have not been addressed in the early stages of planning and programming when many possible project alternatives are under consider- ation. The resources created through the C03 project will make it possible to assess economic impacts during community visioning for transportation or during public and stakeholder involvement in long-range system planning or corridor planning. This research report is based on 100 detailed case studies that document the long-term, before and after economic impacts of a variety of highway capacity investments, mainly from around the United States. This project focused on long-term impacts on perfor- mance metrics such as employment, income, real estate values, and tax revenues. Tempo- rary, construction-phase impacts were not considered in the report or the database of case studies. The report presents documentation on the background of the research project, an explana- tion of how the case studies were selected and developed, an introduction to the accompany- ing web-based tool, and a meta-analysis of the key relationships among factors such as project type, traffic volume, project location, and nontransportation policies put in place to help foster economic development. The findings from the meta-analysis can serve as a high-level guide for transportation agencies in selecting highway capacity projects that, with regard to long-term economic impacts, will provide a greater return on investment. For instance, the meta-analysis indicates that the type of project (e.g., an interchange versus a ring road) and the setting (e.g., in an area that is economically distressed versus non distressed) matter con- siderably more than the amount of money spent to build the project. This report and the accompanying T-PICS (Transportation Project Impact Case Studies) website are intended to serve as a resource for transportation planners and others who are interested in better understanding the long-term economic impacts of highway capacity projects. Although highway projects are the primary focus, a number of intermodal projects (e.g., transit-oriented development projects with both a substantial highway component and freight terminals) are included in the database and web tool. The database and web tool were designed so that future highway case studies and economic impact case studies involv- ing other modes of transportation can be added as they become available. F O R E W O R D David J. Plazak, SHRP 2 Senior Program Officer, Capacity

1 Executive Summary 1 Study Overview 1 Analysis Results 2 Practical Use 3 CHAPTER 1 Study Issues and Process 3 Project Background and Overview 4 Stakeholder Interview Process 4 Stakeholder Needs for Decision Making 5 Refining Economic Impact Concepts 6 Study Design 8 CHAPTER 2 Classification of Project Types and Settings 8 Project Types 9 Types of Project Setting 11 Reference 12 CHAPTER 3 Case Selection and Data Collection 12 Case Study Selection Process 13 Process for Collection of Empirical Data 14 Case Study Interviews 15 Organization of Data for Analysis 15 Reference 16 CHAPTER 4 Results of Data Tabulation 16 Project Profiles 16 Economic Impact Metrics 19 Magnitude of Economic Impact 21 Job Impact Ratios 22 Role of Project Motivation 24 Role of Nonhighway Factors 26 CHAPTER 5 Statistical Analysis of Job Impacts 26 Structure of Regressions 27 Statistical Analysis of Job Impact 28 Statistical Analysis of Job Impact per Dollar 30 Calculations in T-PICS Web Tool 32 CHAPTER 6 Lessons Learned for Case Study Interpretation 32 Types of Benefits and Impacts Covered 35 Use of Case Studies 36 Appropriate Use of the Database C O N T E N T S

40 CHAPTER 7 Lessons for Future Project Planning 40 How Project Details Affect Outcomes 40 Land Use Policies and Conditions 42 Proactive Government Actions 44 Lessons Learned 45 CHAPTER 8 Conducting Future Case Studies 45 Data Collection 46 Analysis 47 Construction of a Narrative 47 Challenges 49 CHAPTER 9 Conclusions and Next Steps 49 Analysis Results 49 Follow-on Research and Development Online version of this report: www.trb.org/Main/Blurbs/166934.aspx.