Methodology for Determining the Economic Development Impacts of Transit Projects

Transit Cooperative Research Program (TCRP) project H-39, “Methodology for Determining the Economic Development Impacts of Transit Projects,” was aimed at developing a method for transit agencies to assess whether and under what circumstances transit investments have economic benefits that are in addition to land development stimulated by travel time savings. It addresses the productivity increases associated with agglomeration economies—economies of scale in density—that may be caused by transit improvements. The authors reviewed existing evaluation practices and academic research, and then carried out a wide-ranging empirical study on metropolitan-level data from cities across the U.S., firm-level data from two metropolitan areas, and case studies of three recent transit projects. A spreadsheet tool was produced that could be used by transit agencies and others to estimate the agglomeration-related economic benefits of rail investments in the forms of new systems or additions to existing systems. With information about any of five possible measures of the proposed investment—track miles, total seating capacity, rail-specific seating capacity, rail revenue miles, or total revenue miles—the spreadsheet provides a range of possible wage or GDP impacts. The tool is best used to compare the agglomeration impacts of transit investments in different metropolitan areas to each other.