June 2011 - Parsons Brinckerhoff

Articles
First, the user can identify the project
alternative that seems to yield
the maximum net benefit from a
sustainability perspective, as opposed
to a traditional benefit-cost analysis
(i.e., include only economic benefits).
In this example, using traditional
benefit-cost analysis, the preferred
alternative would be Alternative 1, the
arterial option, which would have had
a benefit-cost ratio of 2.53. However,
using the PRISM tblv analysis,
Alternative 3, the parkway option,
becomes more attractive with a benefitcost
ratio of 2.70 (Box 3).
Second, the user can identify the
individual contributions of the
respective benefit categories. This
allows users to identify the most (and
least) important benefit categories and
get a quantitative sense of the tradeoffs
involved in community cohesion versus
strict mobility (Box 3).
3
PRISM Illustrative Example (net present value $)
Category
Build Alternative 1
Surface Arterial
Build Alternative 2
Urban Boulevard
Build Alternative 3
Park/Parkway
Environmental
GHG emissions, CO 2
($/metric ton) $2,400,000 $2,000,000 $2,300,000
Stormwater net improvement less costs $3,000,000 $2,000,000 $8,000,000
Habitat $100,000 $0 $1,000,000
Wetlands, high quality created ($/acre) $500,000 $0 $10,000,000
Total environmental $6,000,000 $4,000,000 $21,300,000
Social
Walkability ($/person mile) ($3,000,000) $3,500,000 $5,000,000
Neighborhood cohesion ($/person) ($5,000,000) $3,000,000 $2,000,000
Pedestrian/bicycle access ($3,000,000) $4,000,000 $4,000,000
Park/recreation facilities created ($/acre) $0 $2,000,000 $30,000,000
Total social ($11,000,000) $12,500,000 $41,000,000
Economic
Commercial travel time savings ($/hour) $24,000,000 $18,000,000 $22,000,000
Commute travel cost savings peak, high income ($/hour) $40,000,000 $30,000,000 $36,000,000
Commute travel cost savings peak, medium income ($/hour) $80,000,000 $60,000,000 $75,000,000
Commute travel cost savings peak, low Income income ($/hour) $8,000,000 $6,000,000 $7,000,000
Total economic $152,000,000 $114,000,000 $140,000,000
Results
Cumulative total present value: benefits $147,000,000 $130,500,000 $202,300,000
Cumulative total present value: costs $60,000,000 $100,000,000 $75,000,000
Net present value (PV benefits - PV costs) $87,000,000 $30,500,000 $127,300,000
BC ratio (tblv) 2.45 1.31 2.70
BC ratio (only economic category) 2.53 1.14 1.87
4 Left:
Build Alternative 1: Surface Arterial
Middle:
Build Alternative 2: Urban
Boulevard
4%
-8%
3%
10%
11%
20%
Right:
Build Alternative 3: Park/Parkway
90%
87%
69%
Environmental
Social
Economic
EFR PRISM tblv: Triple Bottom Line Valuation Tool | 61
11%