SENSITIVITY OF A HIGHWAY SAFETY RESOURCE ALLOCATION MODEL TO VARIATIONS IN BENEFIT COMPUTATION PARAMETERS

Resource allocation models aid highway safety planning decisions by setting priorities for projects based on their costs and benefits. In this study, a sensitivity analysis was conducted to see how project selection is affected by failure to adjust the accident database for underreporting and, separately, by the choice of discount rate and accident cost methodology used in coomputing accident cost and the present value of future benefits. The analysis used the INCBEN model developed by the Texas Transportation Institute for the FHWA. At a budget of $300,000 to $600,000, the highway safety and a few other countermeasures in the optimum solution were overwhelmingly better than other countermeasures. Consequently, even large changes in the discount rate, accident costs, and degree of adjustment for accident underreporting had virtually no effect on what projects were in the optimum solution or on the benefits obtained. At a budget of $1.2 to $1.5 million, the solution was much less stable; 20 to 30 percent of the benefit associated with the last $400,000 worth of countermeasures added, or as much as $900,000 in benefits, could be lost through the wrong choice of discount rate or accident cost methodology or through a failure to adjust reported accident data to include estimated underreporting. The effects were particularly notable when the discount rate was less than 2 percent or greater than 8 percent; when the threshold for accident reporting was reporting only of tow-away, injury, and fatal accidents; or when the method of calculating accident costs was changed.