Demonstrating the Benefits of Highway Economic Requirement System – State Version: A Case Study

Highway Economic Requirement System – State Version (HERS-ST) is a highway investment performance computer model which determines the impact of alternative highway investment levels and program structures on highway conditions, performance, and agency, user, and external costs. HERS-ST develops an economically optimal program of investment based on benefit-cost analysis. Assuming that future savings are possible if agencies follow the optimal program recommended by the HERS-ST, this paper estimates the value of these improvements. The research analyzes the benefits derived from HERS-ST implementation using HERS-ST itself. The analysis compares a program based on a HERS-ST strategy to that based on a worst first strategy using Highway Performance Monitoring System data from the State of New Mexico. The analysis estimates that average pavement condition based on HERS-ST is 0.30 points, on a scale of zero to five higher than that based on a worst first strategy over 10 years. Also, HERS-ST identifies benefits of $2.0 billion over the benefit-cost analysis period and benefits of $359 million over 10 years. If the cost for HERS-ST implementation is lower than those benefits over the periods, investment in HERS-ST implementation can be justified.