Benefit Cost Ratio (BCR) Eastern pathways Vs 4 lane roads

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The Benefit Cost Ratio (BCR) is the tool Waka Kotahi (NZTA) uses to measure how its investments will achieve value for money. This means that a BCR of 2.4 for the Eastern Pathways (p62) that costs, say $50 million, will return $120 million to Hamilton’s economy. Note: this is not a true return; nearly all the numbers are based on assumptions so they are not meant to be read as an exact measure.

The Business Case for the School Link project suggests it has a BCR range of 2.1 to 2.7 for 6km (p387) of improvements and a total cost of around $43M (p73), which amounts to $7.16 million per km. It is expected to attract 1,459 new cyclists; a cost of $29k per cyclist. (This may sound large, but compare it to the per-user cost of the Hamilton bypass as described later in this post.) The City Centre to University Business Case options range between BCRs of 1.4 and 2.1 for 3.2km of improvements (p387) and a cost of around $32.3M (p68), or $10.1m per km. It is expected to increase the number of people choosing to take public transport by 11% – 20% (p322).

SAHA Economic Assessment of RoNS (2009) p33 – for more detail see Greater Auckland 13/09/12

In 2009, the SAHA Economic Assessment of the RoNS (roads of national significance) measured the Waikato Expressway BCR range as between 0.5 – 1.1 for 102km of 4-lane highway at a cost of $2,125 million ($2,335 million in 2020 dollars); a cost of $20.8m per km ($23.1 million in 2020 dollars).    (p142 *2012 Waikato Expressway Network Plan v2).

We do not have a BCR for the Hamilton bypass (NZTA web site), but we know it is 21km long and the government of the day was happy to pay $973 million in 2015 to cover the detailed design and construction of the Hamilton section. This represents $46.3 million per km ($50 million in 2020 dollars) or $101k per person, based on the 2041 prediction that 9,600 motorists will use it to bypass Hamilton.

AECOM report: Ruakura Road, Peachgrove Road and Te Aroha Street Intersection Upgrade p33

The Ruakura Road four-laning from Peachgrove Rd to Wairere Dr is 0.4km long. In 2013 it was costed at around $6 million ($6.5 million in 2020 dollars) (p43*) which is $15 million per km ($16 million in 2020 dollars). It was predicted that 33,300 vehicles per day (vpd) would use this road in 2026 (p84*).  In 2015 and 2019 the actual figure for Ruakura Rd was 15,800 vpd, which is two thousand fewer vpd than a decade and a half ago.

*AECOM report: Ruakura Road, Peachgrove Road and Te Aroha Street Intersection Upgrade p7

Count #93 Ruakura Road 5 year average to 2019 is 15,620 vpd.  Count #129 Peachgrove Road North 5 year average to 2019 is 11,920 vpd.  Count #99 Peachgrove Road South 5 year average to 2019 is 6,100 vpd.  Count #94 Te Aroha Street 5 year average to 2019 is 12,400 vpd.  Traffic counts on Ruakura road are now less than when it was a 2 lane road.  (Hamilton City Council Traffic counts web link)

AECOM – Ruakura Road, Peachgrove Road and Te Aroha Street Intersection Upgrade – Assessment of Environmental Effect and Supporting Information – Page 84

Over the past decade, Waka Kotahi (NZTA) has funded plenty of 4-lane roads with low or negative returns. Ruakura Rd is one of the most extreme examples, where the bike lanes were removed to meet future traffic predictions, which are now less than before the project started. With currently 50,000 people per day commuting into the city from surrounding areas, it is expected this will increase by 40% to 90,000 people over the next three decades (P19). There is simply no way of adding 40% more car parks in the city, or space for building more 4-lane roads within the city, without destroying its liveability. The Eastern Pathways project’s BCR assumptions easily outperform 4-lane road projects: the cost per km is lower and the return per targeted user is higher.

School Link Business Case Page 633 showing wider benefits included in Eastern Pathways


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One comment on “Benefit Cost Ratio (BCR) Eastern pathways Vs 4 lane roads

  1. I would be interested to know the traffic count on Ruakura/ Wairere Drive with Ruakura Rd closed to through traffic! And whether it is less than the design volume – because it is not working well in my opinion!
    With Ruakura Rd redesigned to feed The Expressway, traffic is surely going to increase.
    One of the solutions to lack of parking in the City could be “Park and Ride”. This has been done successfully in UK eg. Bath, Somerset, & Nottingham, and to some extent in Auckland.
    So far, Park and,Ride seems only to feature in Hamilton to get ‘out’ of town – on Te Huia. I am not aware of any plans for mass parking to travel into town.
    Apart from work, there may be insufficient drawcard to convince travelers that it is worth it – other than at The Base.

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