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Forecasting Traffic and Toll Revenue for Public-Private Partnerships (P3)
vs. Metropolitan Planning Organizations (MPO):
A comparison
14th TRB National Transportation
Planning Application Conference
Gustavo A Baez, P.Eng.
Baez Consulting, LLC
May 5-9, 2013
Columbus, Ohio
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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OUTLINE OF THE PRESENTATION
• Goals of:– MPO process– P3 process
• Stakeholders and Players
• Forecasting Process
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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GOALS OF THE MPO
AND P3 PROCESS
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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GOALS OF THE MPO PROCESS
• Identify transportation needs at the regional level:– Highways:
• Freeways, tollways, and major arterials
– Transit:• Bus, light rail, high speed, etc.
– Freight– Bicycle and Pedestrian
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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GOALS OF THE P3 PROCESS
• Deliver a infrastructure need identified in the MTP or other Plan– Highway, transit or other
• Forecasting for:– Public agency (MPO, DOT, Toll Agency)– Private entity (Concessionaire/Proposer;
Investor; Rating Agency; etc)
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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GOALS OF THE P3 PROCESSWorking for a Public Agency
• Identify scope of the project• Identify Public Agency Equity:
– Revenue Positive:• Potential Cash Payment
– Revenue Neutral:• Maybe a small subsidy to attract investors
– Revenue Negative:• Re-size your project or bring additional public
equity
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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GOALS OF THE P3 PROCESSWorking for a Private Entity
• Proposing Team:– Optimize traffic and toll revenue to “win”. No
reward for “second place”.
• Investor/Rating Agency/Financial Advisor:– Due diligence:
• How much risk do I have?• Would I recover my investment?
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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STAKEHOLDERS OF THE MPO
AND P3 PROCESS
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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STAKEHOLDERS OF THE MPO PROCESS
MPO DOT
FHWA
TransitAgencies
Public Officials
General Public
FTA
Environ. Organizations
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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STAKEHOLDERS OF THE P3 PROCESS
InfrastructureDevelopers
Private Lenders
PensionFunds
RatingAgencies
TIFIAOffice Bankers
TechnologyCompanies
Lawyers, lawyers and lawyers
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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FORECASTING PROCESS
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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MPO PROCESSModeling
Land use
Model
Travel Demand
Micro-
Simul.Air
Quality
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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MPO PROCESSTravel Demand
• Trip Generation
• Trip Distribution
• Mode Choice
• Multi-modal Assignment
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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MPO PROCESSValidation and Forecast
Data
Collection
Validation Process
(Four-Steps; Regional)
Forecast
Traffic
(20-25 years)
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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MPO PROCESSForecast
• Evaluation of modal alternatives• Once the MTP or MIS has been approved and
the project has been constructed:– Do we systematically compare forecasted traffic
versus actual traffic?– What are the consequences of missing the
forecast?
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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P3 PROCESSTravel Demand
• Very limited amount of time to complete the study
• Begin with the MPO Travel Demand Model (usually vehicle trip-tables)
• Data collection: traffic counts, speed/delay, OD, demographics, SP Surveys
• Disaggregation of trip tables, post-processing• Concentrating on assignment process
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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P3 PROCESSValidation and Forecast
Data
Collection
Validation (Assignment; Corridor level)
Forecast
Traffic
(>35 years)
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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P3 PROCESSForecast
What is the consequence
of under forecasting
or over forecasting?
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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P3 PROCESSForecast
• Client(s) will check your forecast versus actual traffic and revenue the day after the facility opens!!!!!!! Be Ready!!!
• Under-forecast consequence:– Leave money on the table, lose the proposal,
limit the scope of the project
• Over-forecast consequence:– Get a bigger project, bankrupt, liabilities, etc.
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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P3 PROCESSQuantification of Risk
• Sensitivity tests:– Demographics, facility utilization (diversion),
competing facilities, VOT, reliability, ramp-up; level of congestion
– Recessionary scenarios
– Phasing
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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P3 PROCESSSensitivity Tests (Examples)
• Demographic modifications (no-growth, growth reduction, postponing growth)
• Impact of gasoline price increases– Operational costs, land use
• Confidence in toll sensitivity curves– Pricing flexibility
• Impact of modifying Mobility Plan (competing routes)• Impact of the on-going recession• Revenue leakage• Toll rate increase implementation policy (base year,
frequency, percentage)
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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CONCLUSION
• Major differences:– MPO: Regional perspective– MPO: Comparison among alternatives– P3: Corridor perspective– P3: Many more players in the game– P3: More sensitivity tests– P3: Potential legal liabilities for the forecast
outcome
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs
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Questions?
Gustavo [email protected]
214-864-9619
FORECASTING TRAFFIC AND TOLL REVENUE FOR P3 vs. MPOs