Evaluating Alternative Operations Strategies to Improve Travel Time ...

SHRP 2 L11: Final Appendices
and time-related operating costs), the freight-mover value of time may be closer to $40 or $50 per
hour and up to $75 per hour for some freight corridors.
Guidance and Recommended Rates
This section describes the U.S. Department of Transportation Departmental Guidance on the
Valuation of Travel Time in Economic Analysis. The U.S. DOT Guidance is the basis for the
FHWAs Highway Economic Requirements System value-of-time estimates. This guidance is also
used in the FHWA Freight Logistics Reorganization Benefits Estimates Tool.
The empirical basis for the U.S. DOT Guidance on the Valuation of Travel Time in Economic
Analysis (2003) is the clustering of estimates for passenger travelers at around 50 percent of the
hourly wage rate. The U.S. DOT Guidance provides the recommended values for the value of time
as a percent of the hourly wage, differentiating values for local passenger personal travel, local
passenger business travel, intercity passenger personal travel, intercity passenger business travel,
truck driver travel. Acknowledging the variation in the value of time estimates found in the
literature, the U.S. DOT provides plausible ranges for conducting sensitivity analysis. The U.S.
DOT recommended values of travel time are shown in Table B.6. The value of travel time as a
percentage of the wage rate is converted to a dollar value using wage data from the Bureau of
Labor Statistics for business travel and truck-driver wage rates. The median household income
from the U.S. Census Bureau is used for personal travel. The U.S. DOT Guidance for truck travel
time is similar to the cost-approach-based method, with one-hundred percent of the full driver
compensation recommended for the truck-driver value of time.
Table B.6 - U.S. Department of Transportation Recommended Values of Time (2008 dollars)
Personal Local
User Group
Personal Intercity
Business
Truck Drivers
(Local and Intercity)
Value of Time
National Hourly Wage
Per person-hour as a percentage (or Hourly Median Household
of wage rate
Income)
Passenger Travel
50%
$25.12
(35% - 60%)
70%
$25.12
(60% - 90%)
100%
$29.20
(80% - 120%)
Freight Movers
Value of Time
(dollars per person-hour)
$12.55
($8.79 - $15.07)
$17.60
($15.07 - $22.61)
$29.20
($23.28 - $34.92)
100% $23.30 $23.30
The Highway Economic Requirements System (HERS) uses the value of time for seven different
vehicle classes: two passenger vehicle classes and five truck configurations. The value of time is
computed using the USDOT Guidance for driver and occupant time plus estimates on the vehicle
depreciation cost per hour and the freight inventory cost per hour. Variation in the truck value of
time for the different vehicle classes is primarily due to the average vehicle occupancy assumption
applied to the driver compensation for each vehicle class. These values are shown in Table B.7.
DETERMINING THE ECONOMIC BENEFITS OF IMPROVING TRAVEL-TIME RELIABILITY Page B-25