Developing an AASHTO Guide to System-Level Asset Valuation in Support of Transportation Asset Management Decision Making

Return on assets is widely accepted as a measure of performance for asset management and investment analysis and is widely used as a basis for allocating scarce resources—money, for example—among diverse activities that may use those resources to produce desirable goods and services. State departments of transportation (DOTs) are stewards for public infrastructure assets that are essential to our economic vitality, public safety, and quality of life. Accurate, relevant, and reliable asset valuation is crucial for decision making to ensure the effective, efficient and economical management of our highway and transit assets. The current federal highway statute (23 USC 119) and regulations (23 CFR 515) require state DOTs to develop a risk-based transportation asset management plan (TAMP) that includes a valuation of pavements and bridges on the National Highway System (NHS). State DOTs are complying with these requirements through various approaches, but have struggled to incorporate asset valuation into asset management practices or infrastructure investment decisions in a consistent, meaningful way. Practices used internationally for incorporating asset valuation into an organization’s financial statements have not been much used in the U.S. Some guidance has been produced (for example, the Federal Highway Administration’s (FHWA) report on Incorporating Asset Valuation into Transportation Asset Management Financial Plans; National Cooperative Highway Research Program (NCHRP) Reports 483, 608, and 898), but detailed assessment of the issues and practical procedures for valuation and management for public-sector transportation assets in U.S. practice are needed.  The objectives of this research are to examine methods for valuation of system assets and to develop guidance and tools to demonstrate quantitative asset-level valuations for an agency. The research should (a) review various approaches for asset valuation, such as GASB34 and Depreciated Replacement Cost, with a focus on identifying whether current replacement cost or a market value approach should be used, how each is beneficial and can be incorporated into asset management plans and practices; (b) determine a baseline of existing practices currently undertaken by domestic and international highway and transit agencies to identify specific objectives for a standard asset valuation methodology, including case studies of successful implementation; and (c) develop a transportation asset valuation guide and methodology for U.S. transportation agencies, including a roadmap for implementation of appropriate valuation approaches into work planning and programming practices, practical examples that can be used by asset owners, system operators, and planning organizations to utilize asset valuation to improve the effectiveness of investments in transportation infrastructure. 

Language

  • English

Project

  • Status: Proposed
  • Funding: $600000
  • Contract Numbers:

    Project 23-06

  • Sponsor Organizations:

    National Cooperative Highway Research Program

    Transportation Research Board
    500 Fifth Street, NW
    Washington, DC  United States  20001

    Federal Highway Administration

    1200 New Jersey Avenue, SE
    Washington, DC  United States  20590

    American Association of State Highway and Transportation Officials (AASHTO)

    444 North Capitol Street, NW
    Washington, DC  United States  20001
  • Project Managers:

    Lemer, Andrew

  • Start Date: 20191008
  • Expected Completion Date: 0
  • Actual Completion Date: 0

Subject/Index Terms

Filing Info

  • Accession Number: 01707532
  • Record Type: Research project
  • Source Agency: Transportation Research Board
  • Contract Numbers: Project 23-06
  • Files: TRB, RiP
  • Created Date: Jun 3 2019 3:18PM