Benefit-cost analysis and the construction and financing of rail/highway grade separations

Abstract

This paper is concerned with the use of benefit-cost analysis to appraise investment in the construction of grade separations to eliminate or reduce highway traffic over existing rail/highway grade crossings. The paper deals with the measurement and valuation problems involved, and presents the results of a study of five grade separations authorised in Canada. A second issue considered is that of the determination of the appropriate apportionment of capital costs among the parties, rail and highway, involved. Alternative principles for determining who should bear the cost burden of grade separations are developed, and the implications of these cost apportionment procedures for the five Canadian case studies explored.