Transportation Cost Allocation: Applying Cost Allocation in a Multimodal Environment

Abstract

The application of cost allocation techniques to an increasingly multimodal or intermodal federal transportation program is discussed. Numerous statutory changes and policy developments in the 1990s have moved federal policy strongly toward an intermodal approach. As a result, highway cost allocation studies must address topics related to expenditures for multimodal improvements. The issues involved and the implications of a multimodal program for seeking cost-based pricing of transportation facilities are explored. Also examined are the feasibility of approaching cost allocation from a multimodal perspective, the challenges posed to past technical approaches and fundamental objectives, and several policy benefits that might be derived from taking a broader multimodal approach. An assessment of pros and cons is presented, followed by a wide-ranging set of conclusions and recommendations for federal cost allocation research. The central conclusion supports continued modal cost allocation studies emphasizing a comparable approach for each mode and developing information on spillover effects across modes.