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The division of the criteria into two categories follows the principles of good planning and FTA’s guidance on project evaluation, which has been in use for over 20 years, by recognizing that they address very different aspects of project benefits.  Criteria related to effectiveness address how well a project performs without regard to cost, which acknowledges the importance of the magnitude of the project benefits.  Projects with significant benefits, properly normalized so that credit is not simply a function of project size, are notable for what they accomplish.  On the other hand, cost effectiveness addresses the magnitude of project benefits as compared to project costs.  Projects can be very cost effective but have poor effectiveness ratings because their benefits are minimal, as are their costs.  Similarly, projects can be very effective but not cost effective because, while their benefits are considerable, their costs are excessive.  Please refer to the NPRM for specific weights.     

1.1.1 New Starts Effectiveness

FTA proposes that the criteria under effectiveness be: 1) general mobility, 2) economic development/land use, 3) mobility for transit dependents, and 4) environmental benefits.  The primary benefit from major transit projects is likely from their impact on increasing mobility, and the effect of this increase in accessibility in creating more development around station areas.  Because more benefits of projects flow from these factors, they constitute the majority of the rating for project effectiveness.  For specific weights, please refer to the NPRM.  

The benefits of economic development fall primarily into three areas: increases in property values, increases in regional efficiencies, and the reduced travel of those locating close to a transit station.  Increases in property values and rents are not considered because they are already accounted for in the transportation benefits for the project.  To determine regional efficiencies and reduced travel, a promising approach would be to determine the value of both regional efficiencies and reduced travel using models that could ultimately quantify the user benefits expected from the project.  That effort would allow for quantifiable criteria with measures of user benefits that account for both transportation and economic development/land use benefits.  However, requiring that these models be implemented for every project would require both considerable effort and costs for project sponsors.  Until we have more evidence that can shed light on the relative benefits of mobility and economic development/land use, they will be weighted equally for the effectiveness rating.  Please refer to the NPRM for specific weights.

Assessing the value of mobility for transit dependents and of environmental benefits for comparative analysis is problematic in terms of reliable quantification of user benefits.  Clearly, each has a role in assessing the overall benefits expected from projects; therefore, FTA proposes that they be valued equally, at lesser weights, to acknowledge the inherent difficulty in converting them into common measures for comparative analysis.  Please refer to the NPRM for specific weights. General Mobility

FTA proposes three measures for general mobility: 1) the number of average weekday riders on the project; 2) the user benefits per passenger mile on the project; and 3) the severity of the

Federal Transit AdministrationPage 4

Guidance on New Starts Policies and ProceduresJuly, 2007

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