The FHWA Office of Operations developed the Operations B/C Analysis Desk Reference (“the Desk Reference”) to provide guidance on how to conduct B/C analysis for a wide spectrum of TSMO strategies. A B/C analysis is defined in the Desk Reference as a systematic process for calculating and comparing benefits and costs of a project for two purposes:

A B/C analysis estimates the cost-effectiveness of a project by dividing the monetized benefits associated to the project by the costs of implementing and maintaining that project. The resulting cost-effectiveness value is expressed as a ratio or a resultant value. A project with a resultant value greater than one is identified as efficient because the benefits associated with the project are greater than the expected project costs. Projects with a resultant value less than one are deemed inefficient due to the costs outweighing the benefits.

For analyzing TSMO projects, the benefits used in B/C analyses refer to the

monetized estimates of the changes in the identified MOEs

for the project that are directly attributable to the project investment. MOEs typically analyze the impacts of TSMO strategies on aspects of traffic operations, such as:

The costs used in the denominator of the B/C analysis calculations represent the life-cycle costs of implementing, operating, and maintaining the project being analyzed. These life-cycle costs include:

A B/C analysis can be used at multiple stages of a project. An analysis can be conducted during the planning phase as an evaluation tool to determine which TSMO strategies are the most cost-effective and beneficial. It can also be used as an assessment tool to evaluate the success of a project once it has been implemented. The results of a B/C analysis Traffic and Safety Analysis Procedures Manual | 2024 15-6 conducted for planning purposes may be less accurate because more assumptions and estimations are involved. A comparison of MOEs before and after a project is implemented leads to a more accurate B/C analysis because the measured impacts of project implementation are known.