Transportation Cost Allocation: Applying Cost Allocation in a Multimodal Environment

Abstract

The application of cost allocation techniques to an increasingly multi-modal or intermodal federal transportation program is discussed. Numerous statutory changes and policy developments in the 1990s have moved federal policy strongly toward an intermodal approach. As a result, highway cost allocation studies must address topics related to expenditures for multimodal improvements. The issues involved and the implications of a multimodal program for seeking cost-based pricing of transportation facilities are explored. Also examined are the feasibility of approaching cost allocation from a multimodal perspective, the challenges posed to past technical approaches and fundamental objectives, and several policy benefits that might be derived from taking a broader multimodal approach. An assessment of pros and cons is presented, followed by a wide-ranging set of conclusions and recommendations for federal cost allocation research. The central conclusion supports continued modal cost allocation studies emphasizing a comparable approach for each mode and developing information on spillover effects across modes.