Overview and Application
1 / 30

Transit Economic Requirements Model TERM - PowerPoint PPT Presentation

  • Uploaded on

Overview and Application July 10, 2009. Transit Economic Requirements Model (TERM). Agenda. Agenda. Overview Rehab-Replacement Module Application of TERM: Rail Mod Study. Overview. TERM: Purpose.

I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
Download Presentation

PowerPoint Slideshow about 'Transit Economic Requirements Model TERM' - earl

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.

- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
Slide1 l.jpg

Overview and Application

July 10, 2009

Transit Economic Requirements Model (TERM)

Agenda3 l.jpg

  • Overview

  • Rehab-Replacement Module

  • Application of TERM: Rail Mod Study

Term purpose l.jpg
TERM: Purpose

  • TERM is used to assess the current physical condition and future investment needs of the nation’s transit assets / operators

  • Analyses include:

    • Current physical conditions

    • Level of investment required to:

      • Maintain condition/performance

      • Improve condition/performance

  • Impact of constrained investment on future conditions / performance

  • Cost effectiveness of proposed investments (benefit–cost analyses)

  • Results reported in the transit sections of the “Status of the Nation’s Highways, Bridges, and Transit: Conditions and Performance”

  • Term components l.jpg
    TERM Components

    • The TERM application consists of:

      • User Interface

      • Model Database

        • Inventory of US transit assets

        • Agency-mode operating characteristics

        • UZA demographics

        • Cost and investment benefits data by mode

      • User Defined Investment Scenarios

        • Asset rehabilitation and replacement polices

        • Budget constraints

        • Financial assumptions (inflation, discount rate)

      • Output Reports

        • Investment needs by type, mode and urban area size

        • Asset conditions forecasts

    Overview needs investment modules l.jpg





    Asset Expan.

    Reduce Crowd

    Overview : Needs Investment Modules




    Improve Speed

    Benefit-Cost II

    Benefit-Cost I

    • TERM uses six modules to estimate national transit investment needs:

      • Rehab–Replacement (Maintain or Improve Condition): Total investment required for rehabilitation and replacement of the nation’s existing transit assets

      • Asset Expansion (Maintain Performance): Total investment in new, expansion assets as required to maintain existing transit performance given projected growth in transit travel demand

      • Reduce Crowding (Improve Performance I): Expansion investments to reduce crowding in local agency-modes with a high vehicle occupancies

      • Increase Average Speed (Improve Performance II): Expansion investments in higher speed modes (HRT, LRT, or BRT) to improve performance in urbanized areas (UZAs) with low operating speeds

      • Benefit-Cost I (Maintain/Improve Condition, Maintain Performance): Evaluates cost-effectiveness of rehab-replacement and asset expansion investments

      • Benefit-Cost II (Improve Performance): Evaluates cost-effectiveness of performance improvement investments

    Capital needs assessment are inclusive of all asset types l.jpg
    Capital Needs Assessment are Inclusive of All Asset Types

    Stations / Facilities



    • Administration

    • Maintenance

    • Passenger

    • Guideway

    • Track

    • Dedicated Lanes

    Transit Asset Base




    • Rail

    • Buses / Vans /

    • Non-Revenue

    • Electrification

    • Communications

    • Control Systems

    Equipment / Furnishings

    New Technologies

    • Maint. Equip.

    • Computers

    • Elevators / Escalators

    • - AVL / CAD / APC

    • Real Time Info

    Rehab replacement overview l.jpg
    Rehab-Replacement: Overview

    • Estimates investment needs for rehabilitation and replacement of:

      • All urban and rural transit agencies

      • All transit asset types

    • This includes:

      • Elimination of any investment backlog (“deferred investment”)

      • Normal replacement of assets reaching the end of their useful life

      • Mid-life rehabilitations

      • Annual capital expenditures

    • Needs estimated for each year of a twenty-year forecast period

    Rehab replacement asset decay simulation l.jpg
    Rehab-Replacement: Asset Decay Simulation

    • Rehab-Replacement Module simulates the full asset life cycle and decay of all transit assets types — including:

      • Asset use (e.g., vehicle mileage, annual boardings, hours of service, etc.)

      • Annual maintenance,

      • Aging (years of service)

      • Life cycle events (capital maintenance, rehabs/rebuilds and replacement)

    • Analysis relies on:

      • A detailed transit asset inventory

      • Asset investment policy (timing of life-cycle events)

      • Empirically derived decay curves (predict asset condition based on asset type, age, maintenance and utilization)

    • Analysis predicts current assets physical condition and timing /cost of life-cycle events over the next twenty years

    Rehab replacement asset decay simulation13 l.jpg
    Rehab-Replacement: Asset Decay Simulation

    Asset Decay Process

    Asset Inventory

    Model Run:

    Needs Forecast

    Investment Policy

    Listing of Current Asset Inventory

    (Track, Structures, Systems, Facilities, Vehicles, Stations)

    Simulated Decay, Rehab and Replacement of Transit Assets Over Twenty Year Period

    Rehabilitate / replace all assets with a condition of 2.5 or lower


    Needs Forecast

    Asset Conditions Forecast

    Overview current and forecast physical conditions l.jpg
    Overview : Current and Forecast Physical Conditions

    • TERM uses empirically derived decay curves to estimate the current physical condition of all transit assets

    • Curves used to determine those points in the asset life cycle (i.e., condition ratings) at which assets will require rehabilitation and replacement

    • Curves also used to generate forecasts of how transit asset conditions are expected to change under differing scenarios. This capability that allows TERM to run the “maintain” and “improve” conditions scenarios

    TERM’s Condition Rating System

    Aggregate physical condition forecast l.jpg


    Maintain Existing Conditions


    Improve Existing Conditions
















    Aggregate Physical Condition Forecast

    Rehab replacement asset inventory l.jpg
    Rehab-Replacement: Asset Inventory

    • TERM’s asset inventory documents the capital assets of more than 600 urban and rural transit operators

      • Inventory records documents each asset’s type, acquisition date, replacement cost, quantity, owner agency and mode

      • Inventory uses a hierarchical structure with roughly 400 asset types

    The rail modernization study used term to l.jpg
    The Rail Modernization Study used TERM to:

    • Assess the state of good repair needs of nine rail operators (14 rail modes) listed below

    • Investigation excluded:

      • Capacity improvements, major betterments, safety /security

      • Non-rail assets (e.g., bus, paratransit, ferry)

    Agencies/Modes Considered

    Agency selection l.jpg
    Agency Selection

    • These nine agencies operate the majority of the nation’s rail assets and serve the majority of it’s rail riders

    Current conditions23 l.jpg
    Current Conditions

    • The nine agencies also operate and maintain many of the nation’s oldest transit assets

    • More than one-third (34%) of the nine agency’s assets are in either marginal or poor condition

    • In comparison, less than 20% of all US transit assets are in marginal or poor condition

    • This suggests agency reinvestment needs (per dollar invested) are higher than the rest of the industry

    Needs estimation approach l.jpg
    Needs Estimation Approach

    • Use FTA’s Transit Economic Requirements Model (TERM) to estimate level of investment required to bring the nine agencies to a state of good repair

      • Only includes rehabilitation and replacement investments

      • Analysis relied on agency provided asset inventories

      • Applied consistent definition of “state of good repair” to all agencies

      • FTA team met with staff from study agencies to review analysis results

    • SGR Needs Estimates do Not Include:

    • System improvement, expansion or capacity improvements

    • Investment needs of other US transit operators

    • Do include non-rail capital needs of the nine study agencies

    Definition of state of good repair sgr l.jpg
    Definition of State of Good Repair (SGR)

    • “SGR” defined using TERM’s numerically based conditions rating system

    • An asset, group of assets or entire agency is in a state of good repair when the physical condition of that asset (or all assets owned by an agency) is at or above a condition rating of 2.50

    • The level of investment required to attain and maintain a state of good repair is therefore that amount required to rehabilitate and replace all assets with an estimated condition of 2.50 or less

    TERM’s Condition Rating System

    Needs estimates l.jpg
    Needs Estimates

    • The current SGR backlog for the nine agencies is roughly $50.0 billion ($2008)

    • Once this backlog has been addressed, an additional annual investment of $5.9 billion would be required to maintain SGR

    • Alternatively, a total annual investment of $8.4 billion would attain SGR over a twenty-year period while simultaneously addressing normal replacement needs (or $2.5 billion to address the backlog alone)

    • The current annual reinvestment rate is roughly $5.4 billion, or about $0.5 billion less than the $5.9 billion in normal replacement needs

    Study Agency SGR and Annual Normal Replacement Needs (Billions of $2008)

    Needs vs current expenditures l.jpg
    Needs vs. Current Expenditures

    • The current annual $5.4 billion reinvestment rate is:

      • Less than the $5.9 required for normal replacement

      • Well below the $8.4 required to address both normal replacement backlog needs

    • Hence, in the absence of additional funding, the physical condition of these nine agencies is expected worsen