UBC Theses and Dissertations

UBC Theses Logo

UBC Theses and Dissertations

A benefit/cost analysis of reconstructing the Alaska highway to R.A.U. 100 status Christofferson, Kevin Richard 1984

Your browser doesn't seem to have a PDF viewer, please download the PDF to view this item.

Item Metadata

Download

Media
831-UBC_1984_A4_6 C47.pdf [ 18.2MB ]
Metadata
JSON: 831-1.0096009.json
JSON-LD: 831-1.0096009-ld.json
RDF/XML (Pretty): 831-1.0096009-rdf.xml
RDF/JSON: 831-1.0096009-rdf.json
Turtle: 831-1.0096009-turtle.txt
N-Triples: 831-1.0096009-rdf-ntriples.txt
Original Record: 831-1.0096009-source.json
Full Text
831-1.0096009-fulltext.txt
Citation
831-1.0096009.ris

Full Text

A BENEFIT/COST ANALYSIS OF RECONSTRUCTING THE ALASKA HIGHWAY TO R.A.U. 100 STATUS By KEVIN RICHARD CHRISTOFFERSON B.COMM., The U n i v e r s i t y o f B r i t i s h C o l u m b i a , 1980 A THESIS SUBMITTED I N PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE i n B u s i n e s s A d m i n i s t r a t i o n i n THE FACULTY OF GRADUATE STUDIES F a c u l t y o f Commerce a n d B u s i n e s s A d m i n i s t r a t i o n we a c c e p t t h i s t h e s i s a s c o n f o r m i n g t o t h e r e q u i r e d s t a n d a r d THE UNIVERSITY OF B R I T I S H COLUMBIA S e p t e m b e r 1984 © K e v i n R i c h a r d C h r i s t o f f e r s o n , 1984 In p r e s e n t i n g t h i s t h e s i s i n p a r t i a l f u l f i l m e n t of the requirements f o r an advanced degree a t the U n i v e r s i t y of B r i t i s h Columbia, I agree t h a t the L i b r a r y s h a l l make i t f r e e l y a v a i l a b l e f o r r e f e r e n c e and study. I f u r t h e r agree t h a t p e r m i s s i o n f o r e x t e n s i v e copying of t h i s t h e s i s f o r s c h o l a r l y purposes may be granted by the head of my department or by h i s or her r e p r e s e n t a t i v e s . I t i s understood t h a t copying or p u b l i c a t i o n of t h i s t h e s i s f o r f i n a n c i a l g a i n s h a l l not be allowed without my w r i t t e n p e r m i s s i o n . Department of The U n i v e r s i t y of B r i t i s h Columbia 1956 Main Mall Vancouver, Canada V 6 T 1Y3 Date ABSTRACT The A l a s k a H i g h w a y , c o n c e i v e d a n d c o n s t r u c t e d i n t h e e a r l y 1940's a s a s t r a t e g i c m i l i t a r y l i n k a nd s u p p l y r o u t e , now s e r v e s p r i m a r i l y a s a t o u r i s m and c o m m e r c i a l h i g h w a y . A l i g n m e n t s a n d s u r f a c e q u a l i t y t o d a y a r e d r a m a t i c a l l y s u p e r i o r r e l a t i v e t o t h o s e c h a r a c t e r i s t i c o f t h e o r i g i n a l m i l i t a r y h i g h w a y . H o w e v e r , v a s t d i s t a n c e s o f s u r f a c e t r e a t e d r o a d b e d r e m a i n w h i c h c a n o n l y be d e s c r i b e d a s s u b s t a n d a r d i n c o m p a r i s o n t o most o t h e r r u r a l C a n a d i a n h i g h w a y s . Low g r a d e s u r f a c e s and r o a d b e d s n o t o n l y a c t a s a d e t e r r e n t t o t r a f f i c b u t a d d t o v e h i c l e o p e r a t i n g c o s t s , u s e r t i m e c o n s u m p t i o n , t h e l e v e l o f o c c u p a n t d i s c o m f o r t , e t c . , a n d r e s u l t i n h i g h l e v e l s o f h i g h w a y m a i n t e n a n c e e f f o r t s b e i n g i n c u r r e d . T h i s t h e s i s a n a l y s e s t h e i m p a c t on C a n a d i a n s o f r e c o n s t r u c t i n g t h a t s e c t i o n o f t h e A l a s k a H i g h w a y w h i c h l i e s w i t h i n C a n a d a ' s p o l i t i c a l b o u n d a r i e s t o R.A.U. 100 s t a t u s ( R u r a l A r t e r i a l U n d i v i d e d - 100 kph d e s i g n s p e e d ; a s d e f i n e d by t h e A m e r i c a n A s s o c i a t i o n o f S t a t e H i g h w a y O f f i c i a l s ) . T h r e e t r a f f i c g r o w t h s c e n a r i o s a r e d e v e l o p e d , d i s a g g r e g a t e d by t r a f f i c c a t e g o r y ( t o u r i s m , c o m m e r c i a l , l o c a l ) a n d by w h e t h e r i t i s n o r m a l , d i v e r t e d , o r n e w l y g e n e r a t e d . Volume p r o j e c t i o n s , p a r t i c u l a r l y t h o s e a s s o c i a t e d w i t h g e n e r a t e d t o u r i s m t r a f f i c , a r e s u b j e c t t o f a i r l y h i g h l e v e l s o f u n c e r t a i n t y . However, t h e three growth scenarios are s u f f i c i e n t l y wide i n range that i t should be considered h i g h l y improbable i f a c t u a l volumes r e a l i z e d throughout the 20 year study time horizon should f a l l outside t h i s range. Reconstruction of the Alaska Highway w i l l generated a v a r i e t y of i n d i r e c t c o s t s and b e n e f i t s , only some of which can be reasonably q u a n t i f i e d . Attempts are made to a t t a c h a d o l l a r value to those considered q u a n t i f i a b l e while others, such as impacts on nati v e c u l t u r e and the environment are merely l i s t e d and t h e i r v a l u a t i o n l e f t to the d i s c r e t i o n of the d e c i s i o n -maker. Reconstruction costs and incremental highway maintenance savings are determined and then modified to r e f l e c t the high l e v e l s of unemployed and underemployed resources present i n Canada's c u r r e n t l y depressed economy. Savings to highway users accrue i n eight d i s t i n c t resource c a t e g o r i e s . P r i c e s i n some of these c a t e g o r i e s , such as comfort, non-commercial time, and accident c o s t s , are not e a s i l y e s t a b l i s h e d . However estimates are deriv e d and the inputs then analysed with respect t o : - the impact on NPV's and B/C r a t i o s i f input values are changed by an a r b i t r a r y 10% - the r e l a t i v e u n c e r t a i n t y inherent i n each of the user resource c a t e g o r i e s S i m i l a r l y , e s t i m a t e s a r e d e r i v e d f o r t h e p e r v e h i c l e - k i l o m e t e r c o n sumpt i o n o f e a c h r e s o u r c e , b e f o r e and a f t e r h i g h w a y r e c o n s t r u c t i o n . T h e s e a r e a l s o e x a m i n e d f o r t h e i r p o t e n t i a l i m p a c t on q u a n t i t a t i v e r e s u l t s . I n p u t s w i t h w h i c h NPV's and B/C r a t i o s a r e v e r y s e n s i t i v e a r e h i g h l i g h t e d . A f o r t r a n p r o g r a m i s d e v e l o p e d f o r t h e p u r p o s e o f c a l c u l a t i n g NPV's and B/C r a t i o s f o r e a c h o f t h e g r o w t h r a t e s c e n a r i o s and f o r d i s c o u n t r a t e s r a n g i n g b e t w e e n 5% a n d 15% ( 1 % i n t e r v a l s ) . I n a d d i t i o n , t h e o u t p u t l i s t s u s e r s a v i n g s , d i s a g g r e g a t e d by r e s o u r c e c a t e g o r y and by v e h i c l e t y p e f o r a d i s c o u n t r a t e o f 10%. Q u a n t i t a t i v e r e s u l t s a r e c a l c u l a t e d and d i s c u s s e d f o r e a c h o f 5 s c e n a r i o s . T h e s e s c e n a r i o s d i f f e r i n t h e i r a s s u m p t i o n s r e l a t e d t o : - t h e a p p r o a c h t o shadow p r i c i n g r e c o n s t r u c t i o n c o s t s , h i g h w a y m a i n t e n a n c e , a n d c o m m e r c i a l t i m e - t h e e x t e n t o f f u n d i n g s u p p o r t f r o m t h e U n i t e d S t a t e s - i n c l u s i o n o r e x c l u s i o n o f u s e r b e n e f i t s w h i c h a c c r u e t o n o n - C a n a d i a n s R e s u l t s i n d i c a t e t h a t 84% o f t o t a l b e n e f i t s a r e i n t h e f o r m o f r e d u c e d v e h i c l e o p e r a t i n g c o s t s , t i m e s a v i n g s , a n d e n h a n c e d c o m f o r t . More t h a n o n e - h a l f o f t h e s e s a v i n g s a c c r u e t o t h e t o u r i s m t r a f f i c c a t e g e g o r y . Time and f u e l s a v i n g s a r e t h e most s i g n i f i c a n t u s e r r e s o u r c e c a t e g o r i e s , t o g e t h e r r e p r e s e n t i n g 40% o f t o t a l u s e r s a v i n g s . I n f o u r o f f i v e s c e n a r i o s c o n s i d e r e d , V r e s u l t s i n d i c a t e t h a t t h e p r o j e c t i s d e f i n i t e l y q u a n t i f i a b l y b e n e f i c i a l t o C a n a d a . One s c e n a r i o , i n w h i c h r e c o n s t r u c t i o n c o s t s and c o m m e r c i a l t i m e a r e n o t s h a d o w - p r i c e d , a n d b e n e f i t s t o n o n - C a n a d i a n s a r e e x c l u d e d , i n d i c a t e s t h a t t h e p r o j e c t i s p r o b a b l y b e n e f i c i a l . However, i n t h i s c a s e , f u r t h e r r e s e a r c h i n t o r e l a t i v e t i m e and f u e l c o n s u m p t i o n , b e f o r e a n d a f t e r r e c o n s t r u c t i o n , i s w a r r a n t e d p r i o r t o t h e p r o j e c t ' s a c c e p t a n c e o r r e j e c t i o n . I n e a c h c a s e , t h e d e c i s i o n - m a k e r must c o n s i d e r i n d i r e c t i m p a c t s i n c o n j u n c t i o n w i t h q u a n t i t a t i v e r e s u l t s p r i o r t o a f i n a l d e c i s i o n b e i n g made. T h e s i s C o m m i t t e e C h a i r m a n TABLE OF CONTENTS PAGE ABSTRACT I I L I S T OF TABLES V I I I L I S T OF FIGURES X I I I CHAPTER#1; INTRODUCTION 1 1.1 S t u d y O v e r v i e w 1 1.2 H i s t o r y o f H i g h w a y P l a n n i n g i n N o r t h A m e r i c a 5 1.3 The S o c i a l B e n e f i t / C o s t Framework 8 CHAPTER!2; PROJECT OVERVIEW AND REGION F A M I L I A R I Z A T I O N 14 2.1 D a t a C o l l e c t i o n , I n f o r m a t i o n T r a n s f e r , a n d t h e S y s t e m s A p p r o a c h : C o n t e m p o r a r y P r o b l e m s i n a C a n a d i a n C o n t e x t 15 2.3 A l a s k a H i g h w a y : A d m i n i s t r a t i v e R e s p o n s i b i l i t y 21 2.4 A l a s k a H i g h w a y : P h y s i c a l S t a t u s 22 2.5 S o c i o - E c o n o m i c P e r s p e c t i v e 25 2.5.1 A l a s k a 25 2.5.2 Yukon T e r r i t o r y 26 2.5.3 P e a c e R i v e r - L i a r d R e g i o n a l D i s t r i c t 29 2.6 H i s t o r i c a l P e r s p e c t i v e 31 2.7 C o m p e t i n g / C o m p l i m e n t a r y R o u t e s a n d Modes 37 2.7.1 W a t e r 38 2.7.1.1 A l a s k a M a r i n e H i g h w a y 38 2.7.1.2 West C o a s t C r u i s e s h i p S e r v i c e s 42 2.7.1.3 C o a s t a l C o n t a i n e r S h i p / R a i l S e r v i c e 42 2.1.7.5 M a c k e n z i e B a r g e / R a i l / T r u c k S e r v i c e 48 v i i 2.7.2 H i g h w a y s 50 2.7.2.1 C a r c r o s s - S k a g w a y Highway 50 2.7.2.2 High w a y 37 ( S t e w a r t C a s s i a r ) 52 2.7.2.3 C a n o l Road 60 2.7.2.4 L i a r d H i g h w a y 61 2.7.2.5 D e m p s t e r H i g h w a y 62 2.7.2.6 M a c k e n z i e H i g h w a y 64 2.7.3 The A i r Mode 64 2.7.4 The R a i l Mode 67 2.7.4.1 W h i t e P a s s a n d Yukon R a i l w a y 67 2.7.4.2 B.C.R. F o r t N e l s o n E x t e n s i o n 67 2.7.4.3 R a i l L i n e C o n n e c t i n g A l a s k a W i t h C o n t i n e n t a l U.S.A 68 2.7.4.4 O t h e r R a i l D e v e l o p m e n t s 69 2.8 P r o f i l e o f E x i s t i n g T r a f f i c 71 2.8.1 F o r t S a i n t J o h n - F o r t N e l s o n 75 2.8.2 F o r t N e l s o n - Watson L a k e 77 2.8.3 W a t s o n L a k e - W h i t e h o r s e 79 2.8.4 W h i t e h o r s e - Y u k o n / A l a s k a B o r d e r 82 2.9 P r o j e c t O v e r v i e w ' 85 CHAPTER#3; COSTS OF RECONSTRUCTION AND INCREMENTAL HIGHWAY MAINTENANCE SAVINGS 90 3.1 D i r e c t C o s t s A s s o c i a t e d W i t h H i g h w a y R e c o n s t r u c t i o n ... 91 3.2 I n c r e m e n t a l H i g h w a y M a i n t e n a n c e S a v i n g s 94 3.3 D i r e c t S o c i a l C o s t s o f A l a s k a Highway R e c o n s t r u c t i o n and A s s o c i a t e d M a i n t e n a n c e S a v i n g s .... 98 CHAPTER#4: PR I C I N G OF HIGHWAY USER RESOURCES 112 4.1 Shadow P r i c i n g 112 4.1.1 The E c o n o m i c V a l u e o f Time 114 4.1.1.1 E c o n o m i c V a l u e o f Comm. T r a v e l Time 115 4.1.1.2 E c o n o m i c V a l u e o f P e r s o n a l T r a v e l Time .. 124 v i i i 1/ 4 . 1 . \ D i s u t i l i t y o f T r a v e l 128 4.1.3 V e h i c l e D e p r e c i a t i o n 133 4.1.4 V e h i c u l a r A c c i d e n t s 140 4.1.4.1 V a l u e o f L i f e a nd t h e S o c i a l C o s t o f F a t a l A c c i d e n t s ... 141 4.1.4.2 I n j u r y A c c i d e n t s 150 4.1.4.3 P r o p e r t y A c c i d e n t s 151 4.1.5 F u e l 153 4.1.6 T i r e C o s t s 157 4.1.7 M a i n t e n a n c e C o s t s 158 4.2 The S o c i a l D i s c o u n t R a t e 162 CHAPTER!5: PROJECTION OF T R A F F I C VOLUMES 169 5.1 D i s a g g r e a g a t i o n o f F o r e c a s t V o l u m e s : N o r m a l , G e n e r a t e d , and D i v e r t e d 171 5.2 P o p u l a t i o n F o r e c a s t s 173 5.3 P r o j e c t i o n o f T o u r i s t T r a f f i c ( 1 9 8 4 - 2 0 0 3 ) 184 5.4 P r o j e c t i o n o f L o c a l T r a f f i c ( 1 9 8 4 - 2 0 0 3 ) 202 5.4.2 F o r t N e l s o n - W atson L a k e 205 5.4.3 W a t s o n L a k e - W h i t e h o r s e 206 5.4.4 W h i t e h o r s e - Y u k o n / A l a s k a B o r d e r 207 5.5 P r o j e c t i o n o f C o m m e r c i a l T r a f f i c Volume ( 1 9 8 4 - 2 0 0 3 ) ... 209 CHAPTER!6: CONSUMPTION RATES OF USER RESOURCES 222 6.1 V e h i c u l a r A c c i d e n t s 224 6.2 F u e l C o n s u m p t i o n 226 6.3 S p e e d T r a n s i t i o n s 231 6.4 Time C o n s u m p t i o n 233 6.5 T i r e Wear 237 i x 6.6 M a i n t e n a n c e a nd D e p r e c i a t i o n 241 CHAPTER!7: INDIRECT IMPACTS 242 7.1 C o n s t r u c t i o n R e l a t e d I m p a c t s 242 7.1.1 D r a i n a g e P a t t e r n D i s r u p t i o n 243 7.1.2 L a n d S l u m p i n g a nd E r o s i o n 243 7.1.3 B o r r o w P i t s 243 7.1.4 W i l d l i f e I n t e r f e r e n c e 244 7.1.5 D i s r u p t i o n o f A q u a t i c L i f e 244 7.1.6 F o r e s t F i r e P o t e n t i a l 244 7.2 M o t h e r h o o d I s s u e s 246 7.2.1 N a t i o n a l D e f e n c e 246 7.2.2 N a t i o n a l U n i t y 247 7.3 I m p a c t On N a t i v e I n d i a n s 248 7.4 A c c r u a l o f P r i c e R e d u c t i o n s t o N o r t h e r n R e s i d e n t s 249 7.5 C o n t r i b u t i o n t o R e g i o n a l E c o n o m i c D e v e l o p m e n t 250 7.6 A l a s k a H i g h w a y T o u r i s m 251 7.6.1 Yukon T o u r i s m O v e r v i e w 253 7.6.2 O v e r v i e w o f A l a s k a H i g h w a y B a s e d T o u r i s m 254 7.6.3 D e t e r m i n a t i o n o f C o s t s a n d B e n e f i t s 257 7.6.3.1 D e r i v a t i o n o f C o s t p e r G e n e r a t e d T o u r i s t .... 258 7.6.3.1.1 Hig h w a y C a p i t a l C o s t s 258 7.6.3.1.2 Hig h w a y M a i n t e n a n c e C o s t s 260 7.6.3.1.3 C o n g e s t i o n 262 7.6.3.1.4 C a m p s i t e S u b s i d i e s 263 7.6.3.1.5 F o r e s t F i r e S u p p r e s s i o n a n d Damage C o s t s .. 265 7.6.3.1.6 F u e l S u b s i d i e s 267 7.6.3.1.7 E n v i r o n m e n t a l Damage 268 X 7.6.3.1.8 S u b s i d i z e d T o u r i s t F a c i l i t i e s and A t t r a c t i o n s .... 269 7.6.3.2 D e r i v a t i o n o f B e n e f i t s A s s o c i a t e d w i t h G e n e r a t e d T o u r i s m ... 271 7.6.3.2.1 F u e l T a x e s 273 7.6.3.2.2 T o u r i s m E x p e n d i t u r e s 274 7.7 Summary 282 CHAPTER#8: CALCULATION OF B/C RATIOS AND ANALYSIS OF S E N S I T I V I T Y TO INPUT VALUES 286 CHAPTER#9; CONCLUSIONS AND RECOMMENDATIONS 302 APPENDIX 313 SELECTED BIBLIOGRAPHY 362 x i LIST OF TABLES PAGE 2-1 POPULATIONS AND ECONOMIC BASES OF MAJOR YUKON COMMUNITIES 26 2-2 EMPLOYMENT BY CATEGORY - YUKON TERRITORY 27 2-3 POPULATIONS OF MAJOR NORTHEAST B.C. COMMUNITIES 29 2-4 FERRY VOLUMES AT WEST COAST PORTS 40 2-5 ESTIMATES OF POTENTIALLY DIVERTABLE FERRY VOLUME 41 2-6 RAIL AND BARGE VOLUME - WHITE PASS AND YUKON CORPORATION (TONS CARRIED - 1979) ... 44 2-7 1980 GENERAL FREIGHT TARIFFS - EDMONTON TO INUVIK... 63 2-8 RELATIVE PASSENGER AIR TARIFFS 65 2-9 AIR PASSENGER VOLUME - 1981 66 2-10 THOUSAND VEHICLE-KILOMETERS BY CATEGORY (1984) (FT.ST.JOHN TO FT.NELSON) .. 76 2-11 THOUSAND VEHICLE KILOMETERS BY CATEGORY (1984) (FT.NELSON TO WATSON LAKE) ... 79 2-12 THOUSAND VEHICLE KILOMETERS BY CATEGORY (1984) (WATSON LAKE TO WHITEHORSE) .. 81 2-13 THOUSAND VEHICLE KILOMETERS BY CATEGORY (1984) (WHITEHORSE TO YUKON/ALASKA BORDER) .. 84 2- 14 DIVERSION RELATED DISTANCE SAVINGS 88 3- 1 PER KILOMETER CONSTRUCTION COSTS - 1984 DOLLARS 91 3-2 HIGHWAY LENGTH TO BE RECONSTRUCTED 92 3-3 ESTIMATED CONSTRUCTION COSTS 93 3-4 TYPICAL RESURFACING COSTS PER YEAR 95 x i i 3-5 MAINTENANCE COST PER KILOMETER -(RESURFACING EXCLUDED) 95 3-6 TOTAL ADJUSTED HIGHWAY MAINTENANCE COSTS 96 3-7 REDUCTION IN MAINTENANCE DUE TO SURFACE IMPROVEMENTS AND REDUCTION IN ROADWAY LENGTH 97 3-8 TYPICAL LABOUR MIX - HIGHWAY RECONSTRUCTION 100 3-9 DECLINE IN HIGHWAY CONSTRUCTION BID PRICES (FIRST QUARTER - 1981) ... 102 3-10 WAGE INCREAES RELATIVE TO C . P . I 103 3-11 CANADIAN UNEMPLOYMENT RATES IN SELECTED CATEGORIES .. 104 3-12 ESTIMATED SHADOW LABOUR COSTS 109 3-13 PROJECTED BID PRICES 109 3- 14 ESTIMATED RECONSTRUCTION COSTS AND MAINTENANCE SAVINGS 111 4- 1 COMMERCIAL SHADOW WAGE RATES 124 4-2 SUGGESTED VALUES FOR PERSONAL TRAVEL TIME 127 4-3 DEPRECIATION PER KILOMETER - RELATIVE FIGURES 134 4-4 DEPRECIATION (RELATIVE) BY SURFACE QUALITY 135 4-5 VEHICLE MAINTENANCE BY SURFACE QUALITY 160 4- 6 MAINTENANCE COSTS BY VEHICLE AND SURFACE TYPE 160 5- 1 1984 TRAFFIC VOLUMES - BY TRAFFIC CATEGORY 169 5-2 HISTORIC POPULATION FORECASTS 170 5-3 HISTORIC TRAFFIC FORECASTS 171 5-4 REVISED POPULATION FORECASTS - YUKON TERRITORY 181 5-5 WATSON LAKE - POPULATION FORECAST 182 5-6 REVISED WATSON LAKE POPULATION PROJECTIONS 184 5-7 FORT NELSON  POPULATION PROJECTIONS 5x i i i 5-8 ALASKA HIGHWAY GROWTH RATES - BY LOCATION (1959-1962 2-WAY TRAFFIC) 186 5-9 ALASKA HIGHWAY ANNUAL TRAFFIC GROWTH - BY LOCATION - BY LOCATION (1960-1980) .. 186 5-10 ALASKA HIGHWAY AUGUST TRAFFIC COUNTS BY LOCATION 187 5-11 POPULATON GROWTH RATES OF TOURIST ORIGINS 189 5-12 AUTOMOBILE VOLUME PROJECTIONS 192 5-13 AVERAGE ANNUAL NORMAL GROWTH -TOURISM TRAFFIC (1984-2003) 198 5-15 DIVERTED TOURIST TRAFFIC (FT.ST.JOHN-WATSON LAKE) ... 200 5-16 IMPUTED VALUE OF LOCAL TRAVELLING TIME 203 5-17 ASSUMPTIONS RE: LOCAL TRAFFIC GROWTH -FT.ST.JOHN TO FT.NELSON 205 5-18 POPULATIONS - WESTERN YUKON COMMUNITIES 208 5-19 000'S VEHICLE KILOMETERS (PIPELINE RELATED) 210 5-20 TOTAL DISTANCE / DISTANCE OF UNIMPROVED HIGHWAY BETWEEN VANCOUVER AND DESTINATION .. 212 5-21 INCREASE IN VEHICLE-KILOMETERS OVER CURRENTLY NON-RECONSTRUCTED SECTIONS OF ALASKA HIGHWAY .. 214 5-22 FORECAST ANNUAL TONNAGE - DEMPSTER HIGHWAY 217 5- 23 IMPACT OF DEMPSTER HIGHWAY TRAFFIC ON ALASKA HIGHWAY VOLUME 218 6- 1 SAFETY BENEFITS OF RURAL HIGHWAY IMPROVEMENTS 225 6-2 ACCIDENT RATE CORRECTION FACTORS 227 6-3 WEIGHTED AVERAGE ACCIDENT RATE CORRECTION FACTORS ... 227 6-4 FUEL CONSUMPTION IN LITRES PER KILOMETER 230 6-5 WEIGHTED AVERAGE RATES OF FUEL CONSUMPTION 231 6-6 SPEED TRANSITION COSTS PER KILOMETER 233 x i v 6-7 AVERAGE VEHICLE SPEED BY TOTAL SECTION LENGTH AND MAGNITUDE OF GRADE ... 235 6-8 IMPACT OF HORIZONTAL CURVATURE ON VEHICLE DESIGN SPEED 236 6-9 AVERAGE VEHICLE SPEED - BEFORE AND AFTER RECONSTRUCTION 237 6-10 TIRE WEAR CORRECTION FACTORS FOR AUTOS TRAVELLING AT 80 KPH 238 6- 11 TIRE WEAR (DOLLARS PER VEHICLE KILOMETER) 240 7- 1 ALASKA TOURISM - BY VEHICLE CATEGORY 255 7-2 ALASKA HIGHWAY TOURISM - ACTIVITIES 256 7-3 YUKON AND ALASKA TOURISTS - CHOICE OF ACCOMODATION .. 257 7-4 COSTS OF FOREST FIRE DAMAGE AND SUPPRESSION 266 7-5 FEDERAL AND PROVINCIAL GASOLINE TAXES 273 7-6 TOURISM EXPENDITURES - BY MODE OF TRAVEL 276 7-7 CONSUMPTION OF GOODS BY TYPICAL ALASKA HIGHWAY TOURISTS 27 7 7-8 FOREGONE EXPENDITURES BY GENERATING/DIVERTING ONE ADDITIONAL ALASKA HIGHWAY TOURIST PARTY .. 278 7-9 CHANGE IN EXPENDITURE PER GENERATED/DIVERTED ALASKA HIGHWAY TOURIST PARTY 27 9 7-10 BENEFIT TO CANADA PER DOLLAR SPENT 281 7-11 NET CHANGE IN EXPENDITURE PER GENERATED/DIVERTED ALASKA HIGHWAY TOURIST PARTY .. 282 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * X V LIST OF FIGURES FIGURE PAGE 3- 1 THEORETICAL FORMULA FOR ESTABLISHING SHADOW WAGE RATES 107 4- 1 SENSITIVITY OF B/C RATIOS TO APPLIED DISCOUNT RATE 163 5- 1 TRAVEL SUPPLY/DEMAND: ANALYSIS OF CONSUMER SURPLUS 172 5-2 MODIFICATION OF GOVERNMENT OF YUKON POPULATION FORECASTS 175 7-1 PROFILE OF TYPICAL ALASKA HIGHWAY TOURIST 259 7- 2 SUMMARY OF INDIRECT COSTS AND BENEFITS 285 8- 1 COMPUTER OUTPUT - NO VARIABLES MODIFIED 291 8-2 DISTRIBUTION OF USER SAVINGS 292 8-3 DISTRIBUTION OF PROJECT COSTS AND BENEFITS 293 8-4 COSTS AND BENEFITS AS A FUNCTION OF DISCOUNT RATE 294 8-5 COMPUTER OUTPUT: - BENEFITS TO NON-CANADIANS EXCLUDED 295 8-6 COMPUTER OUTPUT: - NO SHADOW-PRICING OF CONSTRUCTION COSTS, MAINTENANCE SAVINGS, OR COMMERCIAL TIME 296 8-7 COMPUTER OUTPUT: - BENEFITS TO NON-CANADIANS EXCLUDED - NO SHADOW-PRICING OF CONSTRUCTION COSTS, MAINTENANCE SAVINGS, OR COMMERCIAL TIME 297 8-8 PROJECT NPV'S AS A FUNCTION OF DISCOUNT RATE 298 8-9 PROJECT NPV'S AS A FUNCTION OF DISCOUNT RATE 299 8-10 GRAPHICAL PRESENTATION OF SENSITIVITY ANALYSIS 300 1 • •• CHAPTER ONE « • INTRODUCTION S o c i a l b e n e f i t / c o s t a n a l y s i s ( S B C A ) , a s a p p l i e d t o t h e u p g r a d i n g o f a r e g i o n a l h i g h w a y , i s a r e l a t i v e l y new a n d c o m p l e x a p p r o a c h t o h i g h w a y p l a n n i n g . I t r e q u i r e s i n p u t a n d e x p e r t i s e f r o m a number o f d i s c i p l i n e s , t h e most p r e v a l e n t b e i n g t h o s e o f h i g h w a y e n g i n e e r i n g a n d e c o n o m i c s . C o n s t r a i n t s on t i m e , f u n d i n g , and d a t a a v a i l a b i l i t y , p e r h a p s i n some c a s e s c o m b i n e d w i t h t h e p l a n n e r ' s l i m i t e d k n o w l e d g e o f some a s p e c t s o f SBCA, c a n a c t t o l i m i t t h e s u c c e s s o f any m a j o r h i g h w a y r e c o n s t r u c t i o n a n a l y s i s . The c o n c l u s i o n s o f s u c h an a n a l y s i s o f t e n g u i d e t h e manner i n w h i c h s o c i e t y ' s d e c i s i o n m a k e r s a l l o c a t e s c a r c e p u b l i c f u n d s . T h e r e f o r e t h e q u a l i t y o f s t u d y a s s u m p t i o n s a n d d a t a , p l u s t h e d e g r e e t o w h i c h p r o c e d u r e s a n d m e t h o d o l o g i e s a r e a p p r o p r i a t e g i v e n t h e p r e v a i l i n g c i r c u m s t a n c e s , t o g e t h e r d e t e r m i n e t h e l e v e l o f a s o c i e t y ' s a l l o c a t i v e e f f i c i e n c y . •• 1.1 STUDY OVERVIEW: T h i s t h e s i s i n v o l v e s b o t h t h e a p p l i c a t i o n o f SBCA t o a s p e c i f i c r e g i o n a l h i g h w a y ( t h e A l a s k a H i g h w a y ) a s w e l l a s a c r i t i c a l l o o k a t how s e n s i t i v e t h e f i n a l r e s u l t s a r e t o v a r i o u s i n p u t p r o c e d u r e s a n d a s s u m p t i o n s . More s p e c i f i c a l l y , t h e s t u d y a t t e m p t s t o a s s e s s t h e n e t i m p a c t on C a nada o f a r e c o n s t r u c t i o n p r o g r a m d e s i g n e d t o u p g r a d e 2 t h e a s y e t u n i m p r o v e d s e c t i o n s o f t h i s 1966 k i l o m e t e r c o r r i d o r t o R.A.U. 100 s t a n d a r d s 1 . C o n s t r a i n t s on t i m e , f u n d s , a n d o t h e r r e s o u r c e s , do n o t p e r m i t an i n d e p t h d i s c u s s i o n o f a l l i s s u e s w h i c h w o u l d o r d i n a r i l y be a d d r e s s e d i n a t h o r o u g h c o s t / b e n e f i t a n a l y s i s . F o r e x a m p l e , many e n v i r o n m e n t a l a n d s o c i a l c o n c e r n s h a v e been d e t a i l e d i n p a s t s t u d i e s s u c h a s t h e Shakwak S t u d y 2 ; t h i s t h e s i s w i l l n o t c o n t r i b u t e f u r t h e r t o e i t h e r t h e e v a l u a t i o n o r u n d e r s t a n d i n g o f t h e s e i s s u e s . However f o r p u r p o s e s o f s t u d y c o m p l e t e n e s s , s u c h i m p a c t s w i l l be o u t l i n e d a n d e x i s t i n g m a t e r i a l a s s o c i a t e d w i t h them s u m m a r i z e d . The A l a s k a H ighway h a s been t h e s u b j e c t o f s e v e r a l s t u d i e s i n t h e p a s t . R e a s o n a b l y t h o r o u g h a n a l y s e s h a v e been c o m p l e t e d by b o t h t h e S t a n f o r d R e s e a r c h I n s t i t u t e 3 , N.D. L e a a n d A s s o c i a t e s " , a n d t h e C e n t r e f o r T r a n s p o r t a t i o n S t u d i e s a t t h e U n i v e r s i t y o f B r i t i s h C o l u m b i a 5 . A l t h o u g h d a t e d , t h e s e a n a l y s e s a s s i s t i n t h e d e v e l o p m e n t o f a c o n t e m p o r a r y a n a l y s i s a n d w i l l be u s e d a c c o r d i n g l y . I n 1 R u r a l A r t e r i a l U n d i v i d e d - 100 kph d e s i g n s p e e d ( a s d e f i n e d by t h e A m e r i c a n A s s o c i a t i o n o f S t a t e H i g h w a y O f f i c i a l s ) 2 SHAKWAK HIGHWAY IMPROVEMENT: ENVIRONMENTAL IMPACT STATEMENT (1977) 3 IMPROVEMENT PROGRAM FOR THE ALASKA HIGHWAY: AN ANALYSIS OF  ECONOMIC BENEFITS (1966) fl THE MAINE CORRIDOR ROAD AND THE ALASKA HIGHWAY: AN EXAMINATION  OF COMPARATIVE COSTS AND BENEFITS ( 1 9 7 0 ) 5 HIGHWAY DEVELOPMENT IN NORTHERN B.C.: P R I O R I T I E S , TIMING, a n d B E N E F I C I A R I E S (1974) 3 a d d i t i o n , l e s s d e t a i l e d s t u d i e s h ave been c o n d u c t e d by a number o f p u b l i c a n d p r i v a t e o r g a n i z a t i o n s s u c h a s t h e P e a c e R i v e r - L i a r d R e g i o n a l D i s t r i c t 6 . F i n a l l y , P u b l i c Works C a n a d a (PWC), t h e f e d e r a l m i n i s t r y now r e s p o n s i b l e f o r b o t h m a i n t e n a n c e a n d c a p i t a l p r o g r a m s a l o n g t h e h i g h w a y , h a s c o m p l e t e d a c o n t e m p o r a r y s t u d y d e s i g n e d t o d e t e r m i n e t h e e x t e n t a n d t i m i n g o f f u t u r e A l a s k a H i g h w a y r e c o n s t u c t i o n 7 . Up t o d a t e i n f o r m a t i o n a n d d a t a , a c q u i r e d b o t h by r e v i e w i n g p u b l i s h e d d o c u m e n t s a nd t h r o u g h c o r r e s p o n d a n c e w i t h c a r r i e r s , s h i p p e r s , a n d g o v e r n m e n t a g e n c i e s , a r e u s e d a l o n g w i t h t h e abo v e d e s c r i b e d s o u r c e s t o d e v e l o p p o p u l a t i o n a n d t r a f f i c f l o w p r o j e c t i o n s . B e c a u s e m a r k e t p r i c e s o f c o m m o d i t i e s consumed o r s a v e d a s a r e s u l t o f h i g h w a y r e c o n s t r u c t i o n do n o t n e c e s s a r i l y r e f l e c t t h e i r s o c i a l o p p o r t u n i t y c o s t s , shadow p r i c e s w i l l be a p p l i e d where a p p l i c a b l e . T h i s p r o c e d u r e i s e x p e c t e d t o e x e r t a s i g n i f i c a n t i m p a c t on t h e o v e r a l l b e n e f i t / c o s t r a t i o . A m a j o r c o n t e m p o r a r y r o l e o f t h e A l a s k a H i g h w a y i s t h e p r o v i s i o n o f a l a n d b a s e d t o u r i s t r o u t e t o t h e Yukon a nd A l a s k a . T h e r e f o r e , b o t h t h e d i r e c t a n d i n d i r e c t c o s t s a n d 6 ALASKA HIGHWAY: REASSESSMENT OF AN UPGRADING AND PAVING PROGRAM (1 9 7 2 ) 7 a l t h o u g h t h i s s t u d y i s n o t c u r r e n t l y a v a i l a b l e f o r p u b l i c i n s p e c t i o n , much o f t h e b a c k g r o u n d d a t a a r e a v a i l a b l e a n d w i l l be u s e d where p o s s i b l e 4 b e n e f i t s a s s o c i a t e d with generated Alaska Highway tourism are c r i t i c a l l y examined i n an attempt to judge whether or not they are the b e n e f i t to Canada that many c l a i m them to be. Included a l s o i s a d i s c u s s i o n of the inadequacies of e x i s t i n g data, and suggestions as to how b e t t e r data could best be acquired. While t h i s t h e s i s does develop an estimate of the net impact on Canadians of r e c o n s t r u c t i n g the Alaska Highway, i t should be regarded as a p r e l i m i n a r y study only. Suggestions as to how the study could be modified and/or expanded to y i e l d more p r e c i s e r e s u l t s are o f f e r e d . These suggestions are based p r i m a r i l y on the r e s u l t s of a n a l y s i n g B/C r a t i o s e n s t i v i t y to various input values. For example, to what degree are study conclusions s e n s i t i v e t o : - values placed on l i v e s l o s t due to v e h i c u l a r acc idents - values placed on t o u r i s t time savings - r e l a t i v e costs of v e h i c u l a r occupant discomfort before and a f t e r r e c o n s t r u c t i o n - various discount r a t e s - the volume of generated t o u r i s t t r a f f i c - r e s i d u a l value of the r e c o n s t r u c t i o n p r o j e c t i n year 20 5 The r e s u l t s o f t h i s a n a l y s i s s h o u l d p r o v i d e some i n s i g h t i n t o how a d d i t i o n a l e f f o r t s h o u l d be d i r e c t e d f o r t h e p u r p o s e o f e s t a b l i s h i n g more a c c u r a t e i n p u t v a l u e s , i f i n f a c t a d d i t i o n a l e f f o r t i s c o n s i d e r e d n e c e s s a r y a t a l l . T h i s w i l l a s s i s t t h e p l a n n e r i n c h o o s i n g how t o b e s t a l l o c a t e l i m i t e d t i m e , f u n d s , a n d o t h e r s t u d y r e l a t e d r e s o u r c e s . T h i s t h e s i s i s n o t s p e c i f i c a l l y d i r e c t e d t o e i t h e r t h e e c o n o m i s t o r h i g h w a y e n g i n e e r , b u t i n s t e a d t o anyone who may be i n t e r e s t e d o r i n v o l v e d i n t h e h i g h w a y p l a n n i n g p r o c e s s . I t w i l l t h e r e f o r e i n c l u d e b a c k g r o u n d on some m a t e r i a l w i t h w h i c h t h e r e a d e r may a l r e a d y be f a m i l i a r . I n c l u d e d f o r c o m p l e t e n e s s i s a s h o r t d i s c u s s i o n o f t h e h i s t o r y o f h i g h w a y p l a n n i n g i n N o r t h A m e r i c a . •• 1.2 HISTORY OF HIGHWAY PLANNING I N NORTH AMERICA P r i o r t o 1950, t h e h i g h w a y p l a n n i n g p r o c e s s p r a c t i s e d i n N o r t h A m e r i c a was much more s u b j e c t i v e a n d l e s s s t r u c t u r e d r e l a t i v e t o t h a t w h i c h e x i s t s t o d a y . " P r o f e s s i o n a l j u d g e m e n t " was o f t e n t h e p r i m a r y t o o l u s e d f o r d e t e r m i n i n g t h e n e e d f o r a new h i g h w a y o r t h e u p g r a d i n g o f an e x i s t i n g o n e. An a c c e p t a b l e a l t e r n a t i v e h i g h w a y p l a n n i n g m e t h o d o l o g y was n o t a v a i l a b l e a t t h e t i m e . S u b s e q u e n t t o t h e s e c o n d w a r , c a r o w n e r s h i p s o a r e d a s d i d t h e c o r r e s p o n d i n g need f o r roadway c a p a c i t y . By 1960, N o r t h 6 A m e r i c a n s c o m p r i s e d o n l y 7% o f t h e w o r l d ' s p o p u l a t i o n y e t c l a i m e d o w n e r s h i p t o 62% o f t h e w o r l d ' s m o t o r v e h i c l e s ( O g l e s b y , 1966, p.1) Between 1946 and 1970, h i g h w a y e x p e n d i t u r e s i n t h e U n i t e d S t a t e s i n c r e a s e d 8 0 0 % t o 16 b i l l i o n d o l l a r s a n n u a l l y ( W i n f r e y a n d Z e l l n e r , 1971, p . 4 ) . I t was t h i s g r o w t h t h a t spawned t h e nee d f o r an i m p r o v e d h i g h w a y p l a n n i n g p r o c e s s . A l t h o u g h t h e b a s i c p r i n c i p l e s o f e c o n o m i c a n a l y s i s a s a t o o l f o r h i g h w a y e v a l u a t i o n s h a d been d i s c u s s e d a s e a r l y a s 1 8 4 7 s , i t s c o n v e r s i o n f r o m t h e o r y t o p r a c t i s e d i d n o t m a t e r i a l i z e u n t i l t h e e a r l y 1 9 5 0 ' s . By t h i s t i m e , r e s e a r c h i n t o m o t o r - v e h i c l e o p e r a t i n g c o s t s a n d a c c e p t a n c e o f t h i s new a p p r o a c h by d e c i s i o n m a k e r s h a d r e a c h e d a c r i t i c a l l e v e l . The r o a d u s e r b e n e f i t a n a l y s i s f r a m e w o r k w h i c h p r o v i d e s an a s s e s s m e n t o f i m p r o v e m e n t r e l a t e d b e n e f i t s t o h i g h w a y u s e r s a n d c o m p a r e s them t o i n c r e m e n t a l c a p i t a l a n d m a i n t e n a n c e c o s t s , c o u l d now be a p p l i e d q u i t e r e g u l a r l y . B e n e f i t s t y p i c a l l y c o n s i d e r e d i n s u c h an a n a l y s i s i n c l u d e r e d u c e d f u e l c o n s u m p t i o n a n d t i r e w e a r , t i m e s a v i n g s , d e c r e a s e d v e h i c l e m a i n t e n a n c e a n d d e p r e c i a t i o n , e t c . T h e r e were a number o f o b s t a c l e s h o w e v e r . W h i l e t h i s more s o p h i s t i c a t e d a p p r o a c h was a c c e p t e d by many, some d e c i s i o n m a k e r s were n o t c o n v i n c e d t h a t i t was s u p e r i o r t o t h e more e a s i l y a p p l i e d a l t e r n a t i v e o f p r o f e s s i o n a l j u d g e m e n t . As 8 G i l l e s p i e p u b l i s h e d "A MANUAL OF THE P R I N C I P L E S AND PRACTISES OF ROAD MAKING" 7 w e l l , a n a l y s t s o f t e n made f u n d a m e n t a l e r r o r s i n a p p l y i n g t h i s f r a m e w o r k . A 1962 s u r v e y 9 o f 130 s t u d i e s c o n d u c t e d by s t a t e h i g h w a y d e p a r t m e n t s i n d i c a t e d t h a t : 95 e x p l i c i t l y i n c o r p o r a t e d r o a d u s e r b e n e f i t s i n t o t h e a n a l y s i s - 68 were p r e s e n t e d i n t h e f o r m o f a b e n e f i t / c o s t f r a m e w o r k y e t b e c a u s e t h i s f r a m e w o r k was new and u n f a m i l i a r t o a n a l y s t s , o n l y 7 o f t h e s t u d i e s e x p l i c i t l y f o l l o w e d c o r r e c t p r o c e d u r e s The l i s t o f e r r o r s i n c l u d e d c o m p l e t e o m i s s i o n o f v a r i o u s c o s t c a t e g o r i e s s u c h a s a c c i d e n t s o r v e h i c l e m a i n t e n a n c e a n d f a u l t y o r s i m p l i s t i c a s s u m p t i o n s s u c h a s t h a t o f a u n i f o r m t r a f f i c l e v e l t h r o u g h o u t t h e e n t i r e a n a l y s i s p e r i o d . T o d a y , two d e c a d e s a f t e r t h e r e l e a s e o f t h e a b o v e s u r v e y , v i r t u a l l y a l l m a j o r h i g h w a y s t u d i e s i n c o r p o r a t e h i g h w a y u s e r b e n e f i t s i n t o t h e i r a n a l y s i s . H i g h w a y e n g i n e e r s a n d p l a n n e r s h a v e h a d g r e a t e r e x p o s u r e t o t h e t e c h n i q u e s t h a n d i d t h e i r p r e d e c e s s o r s , a n d h a v e a v a i l a b l e t o them a number o f p a s t s t u d i e s t o use a s m o d e l s . They a r e , a s a r e s u l t , more s u c c e s s f u l i n t h e i r a p p l i c a t i o n o f u s e r - b e n e f i t f r a m e w o r k s . However, t h i s t y p e o f a n a l y s i s h a s u n d e r g o n e a s u b s t a n t i a l t r a n s f o r m a t i o n s i n c e f i r s t i n t r o d u c e d i n t h e 9 HIGHWAY ENGINEERING W i n f r e y and Z e l l n e r - 1 9 7 1 - p.9 8 e a r l y 1 9 5 0 ' s . The s t a t e - o f - t h e - a r t a p p r o a c h t o d a y i s a h i g h e r l e v e l s o c i a l b e n e f i t / c o s t a n a l y s i s ( S B C A ) . T h i s a p p r o a c h n o t o n l y e v a l u a t e s t h e v a l u e s o f u s e r b e n e f i t s q u i t e d i f f e r e n t l y t h a n d o e s t h e u s e r b e n e f i t c o s t a n a l y s i s , b u t i t i n c o r p o r a t e s i n d i r e c t c o s t s a n d b e n e f i t s a s w e l l . I t i s b a s e d on e v o l v i n g t h e o r y a n d p r i n c i p l e s w h i c h a r e c o n t i n u a l l y b e i n g r e f i n e d . H i g h w a y e n g i n e e r s a nd p l a n n e r s must a g a i n c o n t e n d w i t h new a n d i n some c a s e s u n f a m i l i a r t e c h n i q u e s w h i c h a r e o f t e n d i f f i c u l t t o f u l l y c o m p r e h e n d . •• 1 . 3 THE SOCIAL BENEFIT/COST FRAMEWORK The g o a l g e n e r a l l y p u r s u e d by d i r e c t o r s o f p r i v a t e s e c t o r e n t e r p r i s e s i s m a x i m i z a t i o n o f l o n g t e r m s h a r e h o l d e r w e a l t h . T h us p r o j e c t s a r e a p p r a i s e d by a p p l y i n g c o m m e r c i a l o r f i n a n c i a l c r i t e r i a . M a r k e t p r i c e s a r e u s e d f o r g o o d s , s e r v i c e s , a n d f a c t o r s o f p r o d u c t i o n , d i s c o u n t r a t e s a r e b a s e d on s u p p l y a n d demand f o r money i n f i n a n c i a l m a r k e t s ( p e r h a p s a d j u s t e d by a r i s k f a c t o r ) , a n d p r o j e c t g e n e r a t e d i m p a c t s w h i c h a c c r u e t o t h o s e e x t e r n a l t o t h e f i r m a r e g e n e r a l l y n o t a c c o u n t e d f o r . I n c o n t r a s t , t h e a p p r a i s a l o f p u b l i c p r o j e c t s i s w i d e r i n s c o p e a n d g e n e r a l l y more c o m p l e x . P r i c e s a r e a d j u s t e d t o c o m p e n s a t e f o r m a r k e t i m p e r f e c t i o n s s o t h a t t h e y r e f l e c t t h e s o c i a l c o s t o f a g o o d s o r s e r v i c e s . The c h o o s i n g o f a d i s c o u n t r a t e i s more i n v o l v e d a s i t may, f o r e x a m p l e , i n c o r p o r a t e f a c t o r s s u c h a s t h e p r o j e c t ' s i m p a c t on t h e w e l f a r e o f f u t u r e 9 g e n e r a t i o n s . F i n a l l y , a l l d i r e c t a n d i n d i r e c t i m p a c t s w h i c h a c c u r e t o i n d i v i d u a l s w i t h i n t h e j u r i s d i c t i o n o f t h e d e c i s i o n maker a r e i n c o r p o r a t e d i n t o t h e a n a l y s i s . I t i s t h e a c c u m u l a t i o n o f t h e s e i m p a c t s , o n c e t h e y a r e q u a n t i f i e d a n d c o s t s n e t t e d f r o m b e n e f i t s , t h a t c o n s t i t u t e s a m e a s u r e o f t h e c h a n g e i n a s o c i e t y ' s s o c i a l w e l f a r e . S o c i a l b e n e f i t / c o s t a n a l y s i s (SBCA) e m p h a s i z e s t h e e c o n o m i c e f f i c i e n c y c r i t e r i o n . T h a t i s , i t s e e k s t o d e t e r m i n e t h e d e g r e e t o w h i c h s o c i a l w e l f a r e w i l l be e n h a n c e d o r i m p a i r e d a s a d i r e c t r e s u l t o f t h e u n d e r t a k i n g o f a p u b l i c p r o j e c t . T hus p r o j e c t s w i l l be a c c e p t e d , i n t h e o r y , on t h e b a s i s o f SBCA i f a p o t e n t i a l P a r e t o i m p r o v e m e n t i s t h o u g h t t o e x i s t . A p o t e n t i a l P a r e t o i m p r o v e m e n t i m p l i e s t h a t t h e p r o j e c t may impose n e t c o s t s on some members o f s o c i e t y . However t h o s e who a c c r u e b e n e f i t s a s a r e s u l t o f t h e p r o j e c t ' s a c c e p t a n c e c o u l d , i n p r i n c i p l e , c o m p e n s a t e t h e l o s e r s f o r t h e i r n e t c o s t s a n d s t i l l be b e t t e r o f f t h a n w o u l d be t h e c a s e h ad t h e p r o j e c t been r e j e c t e d . T h i s d o e s n o t g u a r a n t e e t h a t t h e l o s e r s w i l l o r c a n , i n a p r a c t i c a l s e n s e , be c o m p e n s a t e d f o r t h e i r l o s s e s . I n b r i e f , c o n v e n t i o n a l SBCA s e e k s t o m a x i m i z e e f f i c i e n c y w h i l e i g n o r i n g t h e d i s t r i b u t i o n a l c o n s e q u e n c e s o f a p r o j e c t . The e q u i t y i s s u e i s b e c o m i n g more and more p r e v a l e n t i n t h e e v a l u a t i o n o f p u b l i c p r o j e c t s . D e c i s i o n m a k e r s may e x p l i c i t l y s t a t e t h a t e c o n o m i c b e n e f i t s w h i c h a c c r u e t o d e p r e s s e d r e g i o n s o r p e r s o n s w i t h m i n i m a l i n c o m e s a r e o f h i g h e r r e l a t i v e v a l u e t o s o c i e t y . I f s o , t h e a n a l y s t w o u l d 10 be d i r e c t e d t o a p p l y h i g h e r w e i g h t s t o t h o s e b e n e f i t s . The e q u i t y o b j e c t i v e i s i n c o n s i s t e n t w i t h t h a t o f m a x i m i z i n g o v e r a l l e c o n o m i c o u t p u t i n a s o c i e t y , t h e r e f o r e e f f i c i e n c y may be s a c r i f i c e d t o some d e g r e e . P o l i c y a n a l y s i s o r e c o n o m i c i m p a c t a n a l y s i s may be more a p p r o p r i a t e a s a name f o r a f r a m e w o r k w h i c h i n c o r p o r a t e s t h e s e d i s t r i b u t i o n a l a n d p o l i t i c a l c o n s i d e r a t i o n s . SBCA i s n o t a p r e c i s e s c i e n c e . I n s t e a d i t i s s i m p l y a p r o c e s s d e s i g n e d t o a s s i s t a d e c i s i o n maker t o r e a c h an i n f o r m e d a n d r a t i o n a l d e c i s i o n . A v a r i e t y o f u n c e r t a i n t i e s a r e i n h e r e n t i n any SBCA, a n d t h e a n a l y s t must c o p e w i t h t h e s e when e v a l u a t i n g i m p r o v e m e n t p r o g r a m s f o r r e g i o n a l h i g h w a y s . F o r e x a m p l e , t r a f f i c f o r e c a s t i n g i n v o l v e s t h e p r o j e c t i o n o f r e g i o n a l p o p u l a t i o n s , e c o n o m i c d e v e l o p m e n t l e v e l s , d i v e r s i o n p o t e n t i a l t o o t h e r modes o r r o u t e s , a n d e v e n t h e f u t u r e s t a t u s o f a l t e r n a t i v e r o u t e s a n d modes t h e m s e l v e s . A n o t h e r t y p e o f u n c e r t a i n t y c e n t r e s a r o u n d i s s u e s s u c h a s t h e a p p r o p r i a t e s o c i a l v a l u e o f v a r i o u s c a t e g o r i e s o f t i m e a n d l i f e . The a n a l y s t i s r e q u i r e d t o c h o o s e t h e s e v a l u e s a n d a t t e m p t t o j u s t i f y them. Y e t s t r o n g a r g u m e n t s may a l s o e x i s t f o r s i g n i f i c a n t l y d i f f e r e n t v a l u e s and he must c o p e w i t h t h e s e d i v e r g e n t v i e w s w h i l e h o p i n g t h a t h i s c h o s e n v a l u e s do n o t d e v i a t e s u b s t a n t i a l l y f r o m t h e r e a l v a l u e s , w h a t e v e r t h e y may be. E v e n w i t h t h e s e i n h e r e n t u n c e r t a i n t i e s , SBCA i s g a i n i n g a c c e p t a n c e a s a v a l u a b l e t o o l f o r e v a l u a t i n g p u b l i c s e c t o r p r o j e c t s and i s often a p r e r e q u i s i t e for a c q u i r i n g p u b l i c funding. The f e d e r a l Treasury Board S e c r e t a r i a t s t a t e s t h a t : "more and better b e n e f i t / c o s t analyses w i l l be necessary i n g r e d i e n t s in d e c i s i o n s on a l l o c a t i n g government funds" A l s o , Canada's N a t i o n a l Highway P o l i c y d i c t a t e s that b e n e f i t / c o s t analyses must be used to evaluate any f e d e r a l l y sponsored highway improvement program. As a p p l i e d to a r e g i o n a l highway r e c o n s t r u c t i o n program, the SBCA framework can be subdivided i n t o s e v e r a l d i s t i n c t stages, each i n c o r p o r a t i n g one or more i n d i v i d u a l t a s k s . These stages i n c l u d e : •• 1. PROJECT OVERVIEW AND REGION FAMILIARIZATION - the h i s t o r i c e v o l u t i o n of the highway, i t s t r a f f i c flows, r o l e s , and e x i s t i n g p h y s i c a l status should be researched - what types of t r a f f i c e x i s t and what are the prevalent o r i g i n s and d e s t i n a t i o n s of e x i s t i n g users what t r a n s p o r t a t i o n a l t e r n a t i v e s c u r r e n t l y e x i s t and how may they i n f l u e n c e future volumes on the highway i n question - the study time horizon should be e s t a b l i s h e d during t h i s stage 2. DETERMINATION OF CONSTRUCTION COSTS AND MAINTENANCE SAVINGS: c o n s t r u c t i o n costs should be adjusted to r e f l e c t the opportunity c o s t s of resources consumed i n c o n s t r u c t i o n a c t i v i t i e s 12 incremental maintenance savings should be determined for each year of the study time horizon and adjusted to r e f l e c t the s o c i a l opportunity costs of resources consumed i n highway maintenance a c t i v i t i e s 3. DETERMINATION OF USER RESOURCE VALUES: the s o c i a l opportunity costs of user resources which are e i t h e r saved or consumed as a r e s u l t of highway r e c o n s t r u c t i o n must be determined. Resources would t y p i c a l l y i n c l u d e : - f u e l - t i r e s - v e h i c l e maintenance savings - v e h i c l e d e p r e c i a t i o n - time (commercial and non-commercial) - d r i v e r and passenger comfort - l i f e , i n j u r y , and v e h i c l e damage the s o c i a l discount rate should a l s o be e s t a b l i s h e d at t h i s stage •• 4. FORECASTING: p r o j e c t i o n s must be made with respect to r e g i o n a l economic a c t i v i t y and populations p r o j e c t i o n s of v e h i c l e miles must be developed for each year of the study time horizon - v e h i c l e miles must be cat e g o r i z e d by v e h i c l e type t r a f f i c must be ca t e g o r i z e d according to whether i t i s normal growth, d i v e r t e d , or generated as a r e s u l t of the lower user c o s t s a s s o c i a t e d with t r a v e l i n g the reconstructed highway. 5- DETERMINATION OF USER RESOURCE SAVINGS: the net savings i n the q u a n t i t y of resources consumed by v e h i c l e s and t h e i r occupants (as l i s t e d i n stage 3 above) r e s u l t i n g from highway r e c o n s t r u c t i o n must be e s t a b l i s h e d - these savings are a consequence of: - improved highway surface - improved v e r t i c a l and h o r i z o n t a l alignments - increase i n o v e r a l l roadway width - shorter- o v e r a l l highway length 1 3 •B 6. CALCULATION OF USER SAVINGS: - this stage involves the conversion of t r a f f i c forecasts into user savings by multiplying the reduction in user resources consumed, as determined in stage 5, by user resource values, as determined in stage 3 •• 7. DETERMINATION AND MEASUREMENT OF INDIRECT COSTS  AND BENEFITS: - incremental economic a c t i v i t y induced by the highway reconstruction program should be determined - i t should be determined as to whether national defence, unity, or other national objectives w i l l be affected environmental costs related to both reconstruction a c t i v i t i e s and generated t r a f f i c volumes should be discussed i t should be determined as to how tourism may be impacted and what the net benefit or cost of t h i s impact to society •• 8. SENSITIVITY ANALYSIS: - many of those study inputs which are subject to uncertainty should be examined to determine how sensitive f i n a l conclusions are to each - not only does th i s procedure y i e l d some measure as to how v a l i d study conclusions are, but i t indicates how research e f f o r t s should be re-allocated in future studies •• 9. SUMMARY AND CONCLUSIONS: the results are presented along with an assessment as to their v a l i d i t y and recommendations with respect to future studies These nine stages w i l l be expanded upon, each forming a separate chapter and together comprising the remainder of this paper. 1 4 CHAPTER 2 ••• PROJECT OVERVIEW AND REGION FAMILIARIZATION The p r e l i m i n a r y stage of any r e g i o n a l highway planning p r o j e c t i n v o l v e s researching and documenting background information relevant t o : - l o c a t i o n , h i s t o r y , and e x i s t i n g p h y s i c a l p r o f i l e of the highway - the economic base and population of regions served bythe highway - ca t e g o r i z a t o n and measurement of e x i s t i n g t r a f f i c flows - other t r a n s p o r t a t i o n routes and modes which e i t h e r compete with or complement the highway i n c l u d i n g a b r i e f d e s c r i p t i o n of the plans of both p u b l i c and p r i v a t e p a r t i c i p a n t s - the nature of the p r o j e c t i t s e l f i n c l u d i n g d e t a i l s with respect to p h y s i c a l standards and c o n s t r u c t i o n timing This overview i s a c r u c i a l component of the o v e r a l l a n a l y s i s . I t provides the ba s i s upon which p r o j e c t i o n s and major study r e l a t e d assumptions are developed. A f a i r l y thorough i n v e s t i g a t i o n must a l s o be conducted i n t o plans of both p u b l i c and p r i v a t e i n t e r e s t s i n the area which may impact on r e g i o n a l t r a f f i c d e n s i t i e s and d i s t r i b u t i o n . This chapter reviews background m a t e r i a l , as l i s t e d above, s p e c i f i c to the Alaska Highway and the region i t serves. F i r s t , however, a d i s c u s s i o n i s presented which h i g h l i g h t s the i n s t i t u t i o n a l problems 1 5 e n c o u n t e r e d when one a t t e m p t s t o c o l l e c t t h e d a t a a n d i n f o r m a t i o n n e c e s s a r y t o c o n d u c t a p r o p e r s y s t e m s a p p r o a c h t o r e g i o n a l h i g h w a y p l a n n i n g . T h e s e p r o b l e m s may, i n some c a s e s , s i g n i f i c a n t l y i m p a i r t h e a n a l y s t ' s a b i l i t y t o d e v e l o p a s o l i d b a c k g r o u n d o f t h e s y s t e m u n d e r s t u d y . •• 2.1 DATA COLLECTION, INFORMATION TRANSFER, AND THE SYSTEMS  APPROACH: CONTEMPORARY PROBLEMS I N A CANADIAN CONTEXT O v e r a l l t r a f f i c v o l u m e s t o , f r o m , a n d w i t h i n a r e g i o n a r e a f u n c t i o n o f s e v e r a l f a c t o r s , s u c h a s : - r e g i o n a l p o p u l a t i o n l e v e l s - d i s t a n c e b e t w e e n p o p u l a t i o n c e n t r e s - l e v e l o f e c o n o m i c a c t i v i t y - a t t r a c t i v e n e s s t o t o u r i s m t r a f f i c The p r o p o r t i o n o f o v e r a l l t r a f f i c v o l u m e a t t r a c t e d t o a r e g i o n a l h i g h w a y d e p e n d s i n t u r n on t h e a v a i l a b i l i t y a n d r e l a t i v e g e n e r a l i z e d u s e r c o s t s o f a l t e r n a t i v e modes a n d r o u t e s . The f u t u r e e x i s t a n c e o f t h e s e a l t e r n a t i v e s i s c o n t r o l l e d by a v a r i e t y o f p r i v a t e s e c t o r c o r p o r a t i o n s a n d p u b l i c s e c t o r m i n i s t r i e s a n d a g e n c i e s . O v e r l o o k i n g t h e p l a n s a n d p o l i c i e s o f t h e s e o t h e r p a r t i c i p a n t s c o u l d u n d e r m i n e v e h i c l e - k i l o m e t e r f o r e c a s t s a n d t h e r e f o r e s t u d y c o n c l u s i o n s . A c q u i s i t i o n o f t h e a b o v e d e s c r i b e d i n f o r m a t i o n i s n o t a s i m p l e t a s k . F i r s t , p r i v a t e s e c t o r c o r p o r a t i o n s a r e 1 6 u n d e r s t a n d a b l y h e s i t a n t t o r e l e a s e i n f o r m a t i o n a b o u t f u t u r e p l a n s w h i c h may be i n t e r c e p t e d and u s e d t o t h e i r d e t r i m e n t by c o m p e t i t o r s . The same p r o b l e m e x i s t s t o some e x t e n t i n t h e p u b l i c s e c t o r , however i n - h o u s e j e a l o u s i e s r a t h e r t h a n c o m p e t i t i v e p r e s s u r e has been h y p o t h e s i z e d a s t h e s o u r c e o f r e s i s t a n c e t o t h e d i s c l o s u r e o f a n t i c i p a t e d a c t i v i t i e s o r t h e s t a t u s o f c u r r e n t s t u d i e s 1 0 . S e c o n d , f e d e r a l d e p a r t m e n t s , a n d p r o b a b l y p r o v i n c i a l d e p a r t m e n t s a s w e l l , have u n s a t i s f a c t o r y d i s t r i b u t i o n p o l i c i e s f o r r e s e a r c h d o c u m e n t s and r e l a t e d m a t e r i a l . F o r e x a m p l e , t h e C a n a d i a n T r a n s p o r t C o m m i s s i o n d e v e l o p s many c o m p l e t e d r e p o r t s w h i c h do n o t a t t a i n a p u b l i s h e d f o r m a t b u t a r e d o c u m e n t e d a s i n -house memoranda o n l y . A c c o r d i n g t o t h e C.T.C. L i b r a r i a n , t h e r e e x i s t s no e s t a b l i s h e d p u b l i c a t i o n a n d d i s t r i b u t i o n p o l i c y f o r t h e d e p a r t m e n t a s a w h o l e a nd no c o m p u l s o r y d e p o s i t i n i t s c e n t r a l l i b r a r y . The l i b r a r y ' s a p p r o a c h t o o b t a i n i n g a w a r e n e s s o f i n t e r n a l l y p r o d u c e d r e p o r t s r e l i e s o n 1 0 : - p e r s o n a l c o n t a c t s - " c o f f e e - b r e a k c h a t t e r " - n e w s p a p e r s c a n n i n g - c o n t a c t w i t h o t h e r i n f o r m a t i o n c o l l e c t o r s 0 "THE GREAT TRANSPORTATION INFORMATION DILEMA" by t h e C.T.C. L i b r a r i a n a n d T o r o n t o - Y o r k U n i v e r s i t y J o i n t P r o g r a m i n T r a n s p o r t a t i o n ( 1 9 7 4 ) 1 7 I t w o u l d a p p e a r t h a t i n t e r d e p a r t m e n t a l i n f o r m a t i o n t r a n s f e r i s met w i t h a t l e a s t t h e same a n d p r o b a b l y h i g h e r l e v e l o f d i f f i c u l t y . A 1974 r e p o r t 1 0 o u t l i n i n g p r o b l e m s r e l a t e d t o i n f o r m a t i o n c o l l e c t i o n s t r e s s e s t h e l a c k o f c o o r d i n a t i o n and c o - o p e r a t i o n i n t r a n s p o r t a t i o n r e s e a r c h a s w e l l a s t h e c o r r e s p o n d i n g p r o b l e m s e n c o u n t e r e d w h i l e a t t e m p t i n g t o o b t a i n a t o t a l c o m p r e h e n s i v e l o o k a t t h e t r a n s p o r t a t i o n r e l a t e d a r e a one i s i n v e s t i g a t i n g . A d i s c u s s i o n p a p e r p r e s e n t e d a t t h e 1978 C a n a d i a n T r a n s p o r t a t i o n R e s e a r c h Forum A n n u a l C o n f e r e n c e s t a t e d : "we c a n n o t a c h i e v e an e f f i c i e n t t r a n s p o r t a t i o n s y s t e m i f t h e two l e v e l s o f g o v e r n m e n t ( p r o v i n c i a l a n d f e d e r a l ) do n o t h a v e e q u a l a c c e s s t o i n f o r m a t i o n w h i c h c o n s t i t u t e s t h e b a s i s f o r d e c i s i o n m a k i n g " I n 1972, t h e Roads a n d T r a n s p o r t a t i o n A s s o c i a t i o n (RTAC) a t t e m p t e d t o r e d u c e t h e s e v e r i t y o f t h i s p r o b l e m . RTAC c o m p l e t e d a f e a s i b i l i t y s t u d y i n t o e s t a b l i s h i n g a C a n a d i a n T r a n s p o r t a t i o n R e s e a r c h I n f o r m a t i o n S e r v i c e . T h i s s e r v i c e was n e v e r e s t a b l i s h e d . T h e r e i s a n o t h e r r o a d b l o c k t o a c h i e v i n g a c o - o r d i n a t e d s y s t e m s a p p r o a c h t o t r a n s p o r t a t i o n i n f r a s t r u c t u r e p l a n n i n g . C o n f l i c t i n g o b j e c t i v e s o f t e n e x i s t among t h e v a r i o u s d e v e l o p e r s o f i n f r a s t r u c t u r e , w i t h t h e f e d e r a l / p r o v i n c i a l c o n f l i c t b e i n g most o b v i o u s . T h e r e f o r e , e v e n i f t h e v a r i o u s i n t e r e s t s a r e aware o f e a c h o t h e r s p l a n s a n d p o l i c i e s , t h e y may n o t a g r e e on w h i c h d i r e c t i o n t o t a k e . E a c h p a r t i c i p a n t 18 may u s e i t s power a n d f u n d s t o d e v e l o p i n f r a s t r u c t u r e w h i c h i s c o n s i s t e n t w i t h i t s own g o a l s b u t c o n t r a r y t o t h e o t h e r ' s . The r e s u l t i n g s y s t e m o f i n f r a s t r u c t u r e may be s u b o p t i m a l t o s o c i e t y a s a w h o l e . T h e r e h a v e been r e c e n t a t t e m p t s t o a c h i e v e s o m e t h i n g c l o s e r t o a s y s t e m s a p p r o a c h t o t r a n s p o r t a t i o n p l a n n i n g . F o r e x a m p l e , i n 1974 a N a t i o n a l H i g h w a y s P o l i c y was e s t a b l i s h e d w i t h t h e g o a l o f d e v e l o p i n g a more r a t i o n a l a n d c o -o r d i n a t e d a p p r o a c h t o f e d e r a l h i g h w a y a c t i v i t i e s t h a n had e x i s t e d i n t h e p a s t . Among o t h e r t h i n g s , t h e p o l i c y s t a t e s s p e c i f i c a l l y t h a t a b e n e f i t / c o s t a n a l y s i s i s r e q u i r e d t o s u p p o r t any f e d e r a l l y i n i t i a t e d h i g h w a y p r o j e c t . An I n t e r d e p a r t m e n t a l H i g h w a y Commitee was e s t a b l i s h e d f o r t h e p u r p o s e o f c o - o r d i n a t i n g f e d e r a l h i g h w a y p r o g r a m s . The c o m m i t t e e h i g h l i g h t e d t h e l a c k o f a s y s t e m s a p p r o a c h t o t r a n s p o r t a t i o n p l a n n i n g a n d r e s u l t i n g c o s t s by s t a t i n g i n i t s 1976/1977 a n n u a l r e p o r t t h a t : "The f e d e r a l g o v e r n m e n t h a s j u r i s d i c t i o n o v e r t h e m a r i n e a n d r a i l t r a n s p o r t a t i o n modes. The p r o v i n c e s h a ve j u r i s d i c t i o n o v e r t h e i n t r a -p r o v i n c i a l h i g h w a y mode. W i t h o u t a f u l l i n t e r - r e g i o n a l , i n t e r m o d a l t r a n s p o r t a t i o n p l a n n i n g a p p r o a c h , t h e r e i s a d e f i n i t e r i s k t h a t s e r i o u s m i s a l l o c a t i o n s o f i n v e s t m e n t w i l l o c c u r . " 19 I n 1979, t h e P u b l i c Works Canada T r a n s p o r t a t i o n P r o g r a m was c r t i c i z e d by t h e A u d i t o r G e n e r a l f o r i t s f a i l u r e t o a d h e r e t o c r i t e r i a e s t a b l i s h e d by t h e N a t i o n a l H i g h w a y P o l i c y . F a u l t s i n c l u d e d i t s f a i l u r e t o c o l l e c t a nd i n c o r p o r a t e f u l l a n d c o m p l e t e i n f o r m a t i o n i n t o t h e a n a l y s i s a n d , more g e n e r a l l y , t h e l a c k o f a s t r a t e g i c p l a n n i n g p r o c e s s . Of s p e c i f i c r e c o m m e n d a t i o n s f r o m t h e A u d i t o r G e n e r a l , t h e f o l l o w i n g was i n c l u d e d : 1 1 "The t r a n s p o r t a t i o n p r o g r a m s h o u l d d e v e l o p a l o n g - t e r m p l a n i n c o r p o r a t i n g a n d c o m p l e m e n t i n g t h e t r a n s p o r t a t i o n p l a n s o f o t h e r f e d e r a l d e p a r t m e n t s and p r o v i n c i a l g o v e r n m e n t s . " I n summary, t h e f a i l u r e o f an a n a l y s t t o seek o u t and g i v e a d e q u a t e c o n s i d e r a t i o n t o t r a n s p o r t a t i o n p l a n s a n d p o l i c i e s o f o t h e r p a r t i c i p a n t s w i l l i m p a i r t h e v a l i d i t y o f SBCA and t h e o v e r a l l c o s t e f f e c t i v e n e s s t o s o c i e t y o f t h e i n f r a s t r u c t u r e p r o v i d e d . S t a t e m e n t s made by t h o s e who a r e f a m i l i a r w i t h t h e t r a n s p o r t a t i o n p l a n n i n g p r o c e s s i n Canada s u g g e s t t h a t t h e l a c k o f p l a n n i n g c o - o r d i n a t i o n and f a i l u r e t o assume a s y s t e m s a p p r o a c h h a s been a g e n u i n e p r o b l e m i n t h e p a s t . W i t h c o n s i d e r a b l e e f f o r t , t h e a n a l y s t may manage t o o v e r c o m e t h e f i r s t r o a d b l o c k t o a s y s t e m s a p p r o a c h , t h a t b e i n g an i n a d e q u a t e s y s t e m o f i n f o r m a t i o n t r a n s f e r among F e d e r a l G o v e r n m e n t A u d i t o r G e n e r a l R e p o r t - 1979 20 v a r i o u s p a r t i c i p a n t s a nd i n t e r e s t e d p a r t i e s . The o t h e r r o a d b l o c k , t h a t o f i n c o n s i s t e n t p o l i t i c a l o b j e c t i v e s among t h e p a r t i c i p a n t s , i s g e n e r a l l y b e y o n d t h e j u r i s d i c t i o n o f t h e a n a l y s t . Now t h a t a g e n e r a l o v e r v i e w o f i n s t i t u t i o n a l p r o b l e m s and l i m i t a t i o n s h a s been p r o v i d e d , t h i s c h a p t e r makes t h e t r a n s i t i o n t o d i s c u s s i o n s o f a r e l a t i v e l y s p e c i f i c n a t u r e . B a c k g r o u n d i n f o r m a t i o n a nd d a t a r e l a t e d t o t h e A l a s k a H i g h w a y , t h e r e g i o n s i t s e r v e s , a nd t h e p r o p o s e d r e c o n s t r u c t i o n p r o g r a m i t s e l f , a r e p r o v i d e d i n s u b s e c t i o n s 2.2 t o 2.9. •• 2.2 ALASKA HIGHWAY: LOCATION The A l a s k a H i g h w a y e x t e n d s 2700 k i l o m e t e r s f r o m Dawson C r e e k i n n o r t h e a s t B r i t i s h C o l u m b i a t o F a i r b a n k s , A l a s k a . See A p p e n d i x I f o r a map o f t h i s c o r r i d o r . Two s e c t i o n s o f h i g h w a y , t h a t l o c a t e d i n t h e S t a t e o f A l a s k a , ( k i l o m e t e r 1966 t o F a i r b a n k s ) , a s w e l l a s t h a t c u r r e n t l y u n d e r j u r i s d i c t i o n o f t h e B.C. G o v e r n m e n t , (Dawson C r e e k t o k i l o m e t e r 1 3 2 ) , now h a v e r e l a t i v e l y p e r m a n e n t a s p h a l t i c c o n c r e t e s u r f a c e s a nd w i l l a c c o r d i n g l y be e x c l u d e d f r o m f u r t h e r a n a l y s i s i n t h i s r e p o r t . E v a l u a t i o n i s t h e r e f o r e l i m i t e d t o t h e 1832 km s e c t i o n o f t h i s c o r r i d o r w h i c h b e g i n s j u s t n o r t h o f F o r t S a i n t J o h n , B.C., a n d t e r m i n a t e s 30 km n o r t h w e s t o f B e a v e r C r e e k a t t h e Y u k o n / A l a s k a 21 b o r d e r 1 2 . Of t h e t o t a l l e n g t h s u b j e c t t o a n a l y s i s , r o u g h l y o n e - h a l f i s l o c a t e d i n Yukon T e r r i t o r y w i t h t h e r e m a i n d e r l o c a t e d i n n o r t h e a s t B r i t i s h C o l u m b i a . •• 2 - 3 ALASKA HIGHWAY:ADMINISTRATIVE R E S P O N S I B I L I T Y Between e a r l y 1942, when c o n s t r u c t i o n was i n i t i a t e d , a n d 1946, s h o r t l y a f t e r t e r m i n a t i o n o f t h e s e c o n d w o r l d war, t h e e n t i r e l e n g t h o f A l a s k a H i g h w a y was m a i n t a i n e d by and u n d e r t h e s o l e j u r i s d i c t i o n o f t h e U n i t e d S t a t e s m i l i t a r y . A d m i n i s t r a t i o n o f t h e 1966 k i l o m e t e r C a n a d i a n s e c t i o n o f t h i s c o r r i d o r was t h e n t r a n s f e r r e d t o t h e C a n a d i a n D e p a r t m e n t o f N a t i o n a l D e f e n c e , w h i c h a c c e p t e d f u l l r e s p o n s i b i l i t y f o r a l l m a i n t e n a n c e a n d c a p i t a l p r o g r a m s a l o n g t h e r o u t e . Upon c o m p l e t i o n o f r e c o n s t r u c t i o n a n d p a v i n g i n 1962, t h e s o u t h e r n m o s t 132 k i l o m e t e r s o f A l a s k a H i g h w a y was t r a n s f e r r e d t o t h e B r i t i s h C o l u m b i a M i n i s t r y o f H i g h w a y s w h i c h , t o t h i s d a t e , m a i n t a i n s c o m p l e t e j u r i s d i c t i o n . R e s p o n s i b i l i t y f o r t h e r e m a i n i n g 1864 k i l o m e t e r C a n a d i a n s e c t i o n was p a s s e d o n c e more f r o m t h e D e p a r t m e n t o f N a t i o n a l D e f e n c e t o t h e f e d e r a l D e p a r t m e n t o f P u b l i c Works (now PWC), i n 1964. A l t h o u g h s t i l l u n d e r t h e s o l e j u r i s d i c t i o n o f PWC, m a i n t e n a n c e o f t h e Yukon s e c t i o n o f A l a s k a H i g h w a y h a s been c o n d u c t e d on a c o n t r a c t u a l b a s i s 1 2 See A p p e n d i x I f o r a d e t a i l e d map o f t h i s c o r r i d o r 22 by Yukon T e r r i t o r i a l G o v e r n m e n t s i n c e 1972. F e d e r a l / p r o v i n c i a l d i s c u s s i o n s h a v e t a k e n p l a c e w i t h r e s p e c t t o t r a n s f e r r i n g t h e r e m a i n d e r o f t h e B r i t i s h C o l u m b i a s e c t i o n t o t h e p r o v i n c e ' s M i n i s t r y o f H i g h w a y s . However n e g o t i a t i o n s have c e a s e d a n d a t r a n s f e r i s u n l i k e y t o m a t e r i a l i z e i n t h e f o r s e e a b l e f u t u r e . •• 2.4 ALASKA HIGHWAY: PHYSICAL STATUS S e c t i o n s o f A l a s k a H i g h w a y u n d e r j u r i s d i c t i o n o f t h e U n i t e d S t a t e s and B r i t i s h C o l u m b i a g o v e r n m e n t s a r e o f r e l a t i v e l y h i g h p h y s i c a l s t a n d a r d s a n d s u r f a c e d w i t h a s p h a l t i c c o n c r e t e . The r e m a i n i n g 1832 k i l o m e t e r s , on w h i c h t h i s r e p o r t i s f o c u s s e d , h a v e u n d e r g o n e c o n s i d e r a b l e u p g r a d i n g s i n c e t h e t i m e o f t h e h i g h w a y ' s r o l e a s a m i l i t a r y t r u c k r o u t e . Y e t , e v e n t o d a y , t h i s s e c t i o n i s o f low p h y s i c a l s t a n d a r d r e l a t i v e t o most o t h e r C a n a d i a n h i g h w a y s , p a r t i c u l a r l y t h o s e l o c a t e d i n s o u t h e r n r e g i o n s . P o o r h o r i z o n t a l and p h y s i c a l a l i g n m e n t s e x i s t i n many l o c a t i o n s . W h i l e t h e r e i s some p a v e m e n t , i t i s l i m i t e d t o s h o r t l e n g t h s i n t h e v i c i n i t i e s o f l a r g e r s e t t l e m e n t s s u c h a s W h i t e h o r s e , W atson L a k e , a n d F o r t N e l s o n 1 2 . I n a d d i t i o n , 1 2 See A p p e n d i x I I f o r a d e t a i l e d p r o f i l e o f c u r r e n t A l a s k a H i g h w a y p h y s i c a l s t a t u s 23 r o a d b e d s e g m e n t s l a c k i n g a p e r m a n e n t s u r f a c e a r e g e n e r a l l y v o i d o f a p r o p e r l y c o n s t r u c t e d s u b - b a s e . S e c t i o n s a l o n g w h i c h p a v i n g i s p r o p o s e d i n t h e n e a r f u t u r e a r e e x c e p t i o n s . A l t h o u g h pavement i s l i m i t e d , t h e s u r f a c e a l o n g t h i s r o u t e i s r a r e l y one o f l o o s e g r a v e l . I n s t e a d , s u r f a c e t r e a t m e n t s i n c l u d i n g B i t u m i n o u s S u r f a c e T r e a t m e n t (BST) a n d c a l c i u m c h l o r i d e h ave been a p p l i e d e x t e n s i v e l y : • B i t u m i n o u s S u r f a c e T r e a t m e n t : L i q u i d e m u l s i f i e d a s p h a l t i s a p p l i e d t o a p r e p a r e d h i g h w a y s u r f a c e . A f t e r b e i n g c o v e r e d w i t h one i n c h o f l o o s e g r a v e l , t h e o i l b a s e d s u b s t a n c e moves upw a r d a s i t i s a b s o r b e d by t h e g r a v e l . T h i s o i l s a t u r a t e d g r a v e l i s t h e n c o m p a c t e d by e i t h e r i n d u s t r i a l r o l l e r s o r s i m p l y by t h e t i r e s o f h i g h w a y v e h i c l e s u n t i l a h a r d s u r f a c e i s f o r m e d . Q u a l i t y o f t h e r e s u l t i n g s u r f a c e a n d i t s p h y s i c a l l i f e a r e q u i t e v a r i a b l e , w i t h t i m i n g a n d t h o r o u g h n e s s o f a p p l i c a t i o n p l u s t h e s t r e n g t h o f u n d e r l y i n g r o a d b e d b e i n g p r i m a r y f a c t o r s . A t b e s t , a BST t r e a t e d s u r f a c e r e s e m b l e s r o u g h a s p h a l t i c p a v e m e n t . I n f a c t h i g h w a y m a p s 1 3 o f t e n i d e n t i f y them a s p a v e d s u r f a c e s . T h e s e s u r f a c e s d e g r a d e q u i c k l y r e l a t i v e t o t h o s e o f p e r m a n e n t a s p h a l t 1 3 T o u r i s m B r i t i s h C o l u m b i a a n d T o u r i s m Yukon roadmaps c l a s s i f y some s e c t i o n s o f BST t r e a t e d A l a s k a H i g h w a y a s p a v e d r o a d 24 and retreatment i s t y p i c a l l y required a f t e r f i v e years. A common problem i s that potholes of s i g n i f i c a n t surface area and depth can form very q u i c k l y which create obstacles for d r i v e r s and require immediate a t t e n t i o n from maintenance crews. Costing d e t a i l s of t h i s treatment are provided i n chapter 3. • Calcium C h l o r i d e : A s o l u t i o n of CaCl s a l t i s sprayed onto a gra v e l surface and, by absorbing moisture from the atmosphere, tends to keep the gra v e l moist and compacted. Although l e s s c o s t l y than BST, t h i s treatment i s not an a l l weather s o l u t i o n and f a i l s to reduce surface roughness f a c t o r s . Dust problems are reduced, however, and frequency of gra v e l replacement i s decreased. When wet, a surface t r e a t e d with t h i s s o l u t i o n becomes very s l i p p e r y which has some impact on accident p o t e n t i a l . A l s o , surface "mud" i s a t t r a c t e d to v e h i c l e bodies and undercarriages. In a d d i t i o n to poor v e r t i c a l and h o r i z o n t a l alignments, surface widths along t h i s route r a r e l y conform to RAU 1 0 0 standards 1 *. 1 4 See Appendix II for more d e t a i l with respect to roadway widths See Appendix I I I for d e t a i l s with respect to h o r i z o n t a l and v e r t i c a l alignment along the route 25 •• 2.5 SOCIO-ECONOMIC PERSPECTIVE: T r a v e l a l o n g t h e A l a s k a H i g h w a y i s g o v e r n e d p r i m a r i l y by t h r e e d i s t i n c t r e g i o n s . T h e s e i n c l u d e t h e s t a t e o f A l a s k a , Yukon T e r r i t o r y , a n d t h e P e a c e R i v e r - L i a r d R e g i o n a l D i s t r i c t i n n o r t h e a s t B r i t i s h C o l u m b i a . • 2.5.1 ALASKA: R o u g h l y 1,550,000 s q u a r e k i l o m e t r e s i n a r e a , A l a s k a owes much o f i t s w e a l t h t o t h e a v a i l a b i l i t y o f e x p l o i t a b l e n a t u r a l r e s o u r c e s . W i t h c o m p l e t i o n o f t h e T r a n s - A l a s k a o i l p i p e l i n e i n 1977, t h e o i l i n d u s t r y i s now t h e p r i m a r y c o n t r i b u t o r t o A l a s k a ' s economy. O t h e r i n d u s t r i e s , i n o r d e r o f t h e i r f i n a n c i a l c o n t r i b u t i o n t o t h e r e g i o n a l economy, i n c l u d e t o u r i s m , f i s h i n g , a n d t i m b e r 1 5 . Of 406,000 r e s i d e n t s , 63,000 a r e i n d i g e n o u s t o t h e a r e a and i n c l u d e I n d i a n s , E s k i m o s , and A l e u t s . P o p u l a t i o n g r o w t h r a t e s h a v e been somewhat u n s t a b l e i n t h e p a s t due t o A l a s k a ' s p a r t i c i p a t i o n i n t h e war e f f o r t a s w e l l a s s h o r t t e r m b u t h i g h i m p a c t d e v e l o p m e n t s s u c h as t h e o i l p i p e l i n e . An a v e r a g e g r o w t h r a t e o f 2.6% h a s been e x p e r i e n c e d d u r i n g t h e p a s t two d e c a d e s . I t may be r e a s o n a b l e t o e x p e c t t h a t g r o w t h r a t e s i n t h e f o r s e e a b l e f u t u r e w i l l n o t d e v i a t e s u b s t a n t i a l l y f r o m t h i s f i g u r e . 1 5 A l a s k a T r a v e l A g e n t ' s M a n u a l ( 1 9 8 2 ) p.8 26 S o u t h e a s t A l a s k a , w i t h a p o p u l a t i o n o f 55,000, i s l i n k e d by h i g h w a y t o t h e r e m a i n d e r o f t h e s t a t e f r o m b o t h H a i n e s a n d S k a g w a y 1 6 . T h i s r e g i o n h o s t s t h e c a p i t a l o f t h e S t a t e , J u n e a u ( p o p . 1 7 , 0 0 0 ) , w h i c h i s a c c e s s i b l e o n l y by a i r a n d w a t e r . The g l a c i e r s a n d g e n e r a l t o p o g r a g h y o f S o u t h e a s t A l a s k a p r o v i d e t h e a t t r a c t i o n f o r a l a r g e s c a l e c r u i s e s h i p i n d u s t r y . • 2.5.2 YUKON TERRITORY: W i t h a l a n d a r e a o f 482,000 s q u a r e k i l o m e t e r s a n d p o p u l a t i o n o f o n l y 2 5 , 0 0 0 , Yukon i s t h e most s p a r s e l y p o p u l a t e d o f t h e t h r e e r e g i o n s . W h i t e h o r s e ( p o p . 1 6 , 7 0 0 ) 1 7 , t h e c a p i t a l a n d t r a n s p o r t a t i o n c e n t r e o f t h e t e r r i t o r y , i s t h e home o f r o u g h l y t h r e e o u t o f f o u r Y u k o n e r s . O t h e r s e t t l e m e n t s i n t h e r e g i o n , l i s t e d i n TABLE 2-1, a r e s m a l l by c o m p a r i s o n . A p p r o x i m a t e l y 12,500 p e r s o n s , one h a l f t h e ********************* TABLE 2—1 ************************** POPULATIONS AND ECONOMIC BASES OF MAJOR YUKON COMMUNITIES SETTLEMENT 1982 POPULATION ECONOMIC BASE Dawson C i t y 1250 - t o u r i s m / s e r v i c e F a r o 1972 - m i n i n g W atson L a k e ' 1348 - f o r e s t r y / t r a n s p o r t a t i o n * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 1 6 t h e l i n k f r o m Skagway i n c o r p o r a t e s t h e C a r c r o s s - S k a g w a y H i g h w a y , w h i c h i s c u r r e n t l y open on a summer b a s i s o n l y 1 7 YUKON ECONOMIC REVIEW - E c o n o m i c R e s e a r c h a n d P l a n n i n g U n i t -4 t h q u a r t e r ( 1 9 8 2) 27 t o t a l p o p u l a t i o n , a r e c o n s i d e r e d t o be l e g i t i m a t e members o f t h e l a b o u r f o r c e 1 8 . By f a r t h e l a r g e s t e m p l o y e r i n t h e t e r r i t o r y i s g o v e r n m e n t , w i t h 3,900 e m p l o y e e s i n 1 9 8 2 1 9 . N o n - g o v e r n m e n t e m p l o y m e n t , by i n d u s t r y , i s l i s t e d i n TABLE 2-2. ************** TABLE 2 - 2 **************** EMPLOYMENT BY CATEGORY - YUKON TERRITORY INDUSTRY APPROXIMATE 1982 EMPLOYMENT 1 9 ******** ***************************** S e r v i c e 3000 M i n i n g 1100 T r a n s p o r t a t i o n 660 C o n s t r u c t i o n 600 C o m m u n i c a t i o n s & U t i l i t i e s 490 F o r e s t r y 30 ****************************************** Y u k o n ' s economy i s p a r t i c u l a r l y s e n s i t i v e t o w o r l d p r i c e s f o r m i n e r a l s , s p e c i f i c a l l y l e a d , z i n c , a n d g o l d , a n d t o t h e e x t e n t o f i n s t i t u t i o n a l i n c e n t i v e s f o r e x p l o r a t i o n a n d m i n i n g i n t h e a r e a . The c u r r e n t w o r l d w i d e d e c l i n e i n e c o n o m i c a c t i v i t y a n d c o r r e s p o n d i n g i n f l u e n c e on r e s o u r c e demand h a s been e s p e c i a l l y d e v a s t a t i n g t o t h i s r e g i o n . The s e v e r i t y o f t h e p r o b l e m i s i l l u s t r a t e d by t h e f o l l o w i n g : 1 8 I b i d . P.12 1 9 I b i d . P.13 28 1. The v a l u e o f a n n u a l m i n e r a l p r o d u c t i o n i n t h i s r e g i o n h a s d e c l i n e d f r o m $360,000,000 i n 1980 t o $168,000,000 i n 1 9 8 2 2 0 . 2. The c l o s i n g o f C y p r u s A n v i l ' s l e a d / z i n c mine on J u n e 4 t h , 1982, U n i t e d Keno H i l l ' s s i l v e r m i n e , a nd t h e W h i t e h o r s e C o p p e r mine i n l a t e 1982, h a v e l e f t t h e t e r r i t o r y w i t h no a c t i v e m i n e s f o r t h e f i r s t t i m e t h i s c e n t u r y . I n t h e r e c e n t p a s t , m i n i n g h a s a c c o u n t e d f o r t w o -t h i r d s o f t h e t o t a l v a l u e o f g o o d s a nd s e r v i c e s p r o d u c e d i n t h e t e r r i t o r y 2 1 . 3. W h i t e P a s s a n d Yukon R a i l w a y s e r v i c e s were t e r m i n a t e d 9/30/82 f o r t h e f i r s t t i m e s i n c e o p e r a t i o n s began i n 1899. V i r t u a l l y a l l r e s o u r c e t r a f f i c h a s h i s t o r i c a l l y moved v i a t h i s r a i l w a y t o t i d e w a t e r a t Skagway a n d s h i p t o V a n c o u v e r . 4. "Yukon i s an e c o n o m i c r e g i o n t h r e a t e n e d w i t h e x t i n c t i o n " 2 2 . Y u k o n ' s r e c e n t d e c l i n g p o p u l a t o n t r e n d , c o m b i n e d w i t h i m p l i c i t a n d e x p l i c i t g o v e r n m e n t s u p p o r t 2 3 , h a s been c r i t i c a l i n m a i n t a i n i n g o f f i c i a l u nemployment r a t e s a t no w o r s e t h a n 18%. W h i l e t h e s e r v i c e i n d u s t r y p r o v i d e s some d e g r e e o f e c o n o m i c d i v e r s i f i c a t i o n , i t s e x i s t e n c e a n d g r o w t h p o t e n t i a l i n t u r n d e p e n d on t h e h e a l t h o f t h e r e s o u r c e s e c t o r . The f o r e s t i n d u s t r y , c e n t e r e d i n 0 YUKON ECONOMIC REVIEW - E c o n o m i c R e s e a r c h a n d P l a n n i n g U n i t ( 1 9 8 2 ) p. 65 1 THE FI N A N C I A L POST - 9/25/82 p. 1 2 s t a t e m e n t f r o m Yukon g o v e r n m e n t a s q u o t e d f r o m THE FINANCIAL  POST - 9/25/82 p.1 3 g o v e r n m e n t employment was a c t u a l l y i n c r e a s e d d u r i n g 1981/1982 d e s p i t e d e c l i n i n g p o p u l a t i o n i n t h e t e r r i t o r y - YUKON ECONOMIC  REVIEW ( 1 9 8 2 ) p.13 29 t h e v i c i n i t y o f W a t s o n L a k e , i s s u f f i c i e n t l y s m a l l t h a t i t s i m p a c t on t h e o v e r a l l ecomomy o f Yukon i s n e g l i g i b l e . A l t h o u g h some g r o w t h i n t h i s i n d u s t r y was r e a l i z e d d u r i n g t h e p a s t d e c a d e , c u r r e n t p r o d u c t i o n o f 112,000 c u b i c m e t e r s i s c u r r e n t l y b e l o w t h a t e x p e r i e n c e d i n 1970. • 2.5.3 PEACE RIVER - LIARD REGIONAL D I S T R I C T : M a j o r s e t t l e m e n t s i n t h i s r e g i o n w h i c h a r e s i t u a t e d a l o n g t h e A l a s k a H i g h w a y a r e l i s t e d i n TABLE 2-3. The e n t i r e ************ TABLE 2 - 3 ************ POPULATIONS OF MAJOR NORTHEAST B R I T I S H COLUMBIA COMMUNITIES SETTLEMENT 1982 POPULATION 2" ********** *************** Dawson C r e e k 16,700 F t . S t . J o h n 16,700 F t . N e l s o n 3,724 *********************************** P e a c e R i v e r - L i a r d D i s t r i c t h a s a 1982 p o p u l a t i o n o f 54,000 and h a s been e x p e r i e n c i n g an a v e r a g e a n n u a l g r o w t h r a t e o f b e t w e e n 1.7 and 2%. As i s t r u e i n t h e Y u k o n , t h e economy o f t h i s r e g i o n i s 2 4 1982 p o p u l a t i o n f i g u r e s f r o m ECONOMIC DEVELOPMENT OVERVIEW - P e a c e - L i a r d R e g i o n by t h e P e a c e R i v e r - L i a r d E c o n o m i c D e v e l o p m e n t C o m m i s s i o n ( 1 9 8 3 ) 30 p r i m a r i l y r e s o u r c e b a s e d . S p e c i f i c a l l y , t h e e c o n o m i c b a s e o f F o r t N e l s o n i s c e n t r e d a r o u n d t h e f o r e s t i n d u s t r y a s w e l l a s o i l a n d gas e x p l o r a t i o n , d r i l l i n g , a n d p r o c e s s i n g . F o r t S a i n t J o h n i s a m a j o r s e r v i c e c e n t r e f o r o i l a n d g a s d r i l l i n g a n d p r o c e s s i n g 2 5 , s e r v e s b o t h l o c a l a n d t h r o u g h h i g h w a y t r a f f i c , a n d c a t e r s t o t h e n e e d s o f t h e r e g i o n a l a g r i c u l t u r e i n d u s t r y w h i c h i s c e n t r e d f u r t h e r s o u t h . The e c o n o m i c b a s e o f Dawson C r e e k i s p r i m a r i l y a g r i c u l t u r e a n d s e r v i c e r e l a t e d . As a r e s u l t , i t i s somewhat l e s s v u l n e r a b l e t o t h e r e c e s s i o n t h a n o t h e r c o m m u n i t i e s s i t u a t e d i n t h i s r e g i o n . The c u r r e n t e c o n o m i c h a r d s h i p s s u f f e r e d by t h e F o r t S a i n t J o h n a n d F o r t N e l s o n a r e a s a r e n o t u n l i k e t h o s e o f t h e Y u k o n . F o r e x a m p l e : 1. Two p e t r o l e u m w e l l s a r e c u r r e n t l y b e i n g d r i l l e d i n t h e a r e a c o m p a r e d t o e i g h t y o r more w h i c h w o u l d be t y p i c a l g i v e n h e a l t h y m a r k e t c o n d i t i o n s 2 6 . 2. O f f i c i a l u nemployment r a t e s o f 17% a r e t y p i c a l i n t h e r e g i o n . U n o f f i c i a l r a t e s o f 2 5 % a r e s u g g e s t e d a s b e i n g more r e a l i s t i c 2 7 . 2 5 a s i z a b l e P e t r o - C a n a d a o i l r e f i n e r y i s l o c a t e d i n T a y l o r , n e a r F o r t S a i n t J o h n 2 6 t h e r e d u c t i o n i n d r i l l i n g a c t i v i t y i s a r e s u l t o f d e p r e s s e d m a r k e t c o n d i t i o n s b u t a s w e l l t h e r e c e n t c h a n g e s i n f e d e r a l e n e r g y p o l i c y 2 7 THE VANCOUVER SUN - 5/9/83 p.1 31 3. V a c a n c y r a t e s o f 2 5 % ( r e s i d e n t i a l ) a nd 45% ( c o m m e r c i a l ) c u r r e n t l y e x i s t . R o u g h l y 1000 p e r s o n s r e s i d e a l o n g t h e A l a s k a H i g h w a y b e t w e e n F o r t S a i n t J o h n a n d Lower P o s t ( n e a r W atson L a k e ) . Incomes o f t h e s e r e s i d e n t s a r e p r i m a r i l y g e n e r a t e d t h r o u g h t h e o p e r a t i o n o f l o d g e s , r e s t a u r a n t s , and s e r v i c e s t a t i o n s w h i c h c a t e r t o t h e n e e d s o f b o t h c o m m e r c i a l a n d r e c r e a t i o n a l t r a f f i c . A l t h o u g h few i n number, t h e s e a r e t h e p e o p l e who w o u l d f e e l t h e g r e a t e s t i m p a c t s h o u l d t r a f f i c v o l u m e s a l o n g t h e c o r r i d o r u n d e r g o s u b s t a n t i a l c h a n g e s . •• 2.6 HISTORICAL PERSPECTIVE: The d i s c o v e r y o f g o l d n e a r Dawson C i t y , Y u k o n , i n 1896 q u i c k l y s w e l l e d t h e t e r r i o r i y ' s p o p u l a t i o n t o 2 8,000. T h i s l e v e l h a s n o t been a c h i e v e d s i n c e . I t was t h i s g o l d r u s h t h a t s t i m u l a t e d t h e n e e d f o r , a n d f i n a l l y c o n s t r u c t i o n o f , t h e W h i t e P a s s & Yukon R a i l w a y i n 1899. T h i s W h i t e h o r s e -Skagway r a i l c o n n e c t i o n , c o m p l e m e n t e d by a w e s t c o a s t c o n t a i n e r s h i p s e r v i c e , was u n t i l v e r y r e c e n t l y , t h e most s i g n i f i c a n t t r a n s p o r t l i n k b e t w e e n Yukon a n d t h e s o u t h i n t e r m s o f t o n n a g e . T e r m i n a t e d i n S e p t e m b e r o f 1982, s e r v i c e s a r e e x p e c t e d t o be r e a c t i v a t e d o n c e r e s o u r c e c o m m o d i t i e s , p r i m a r i l y l e a d / z i n c o r e , a r e a g a i n p r o d u c e d . The r u s h o f p e o p l e t o t h e Yukon i n s e a r c h o f g o l d was s h o r t l i v e d . As t h e v o l u m e o f e a s i l y e x p l o i t a b l e g o l d i n t h e t e r r i t o r y 32 d e c r e a s e d , so d i d Y u k o n ' s p o p u l a t i o n . By 1910, t h e p o p u l a t i o n had f a l l e n 20,000 t o 8,000, and f u r t h e r t o 3,000 by 1 9 2 0 2 8 . The t h r e a t o f a w e s t c o a s t J a p a n e s e i n v a s i o n d u r i n g W o r l d War 2 was t h e c a t a l y s t r e s p o n s i b l e f o r g e n e r a t i n g t h e s e c o n d Yukon d e v e l o p m e n t boom. W h i t e h o r s e , p r i m a r i l y b e c a u s e o f i t s s t r a t e g i c l o c a t i o n , q u i c k l y became t h e c e n t r e o f m i l i t a r y a c t i v i t y . The C a n o l o i l p i p e l i n e and s e r v i c e r o a d were c o n s t r u c t e d , a s was an o i l r e f i n e r y a t W h i t e h o r s e , t o e n s u r e an o i l s u p p l y f o r m i l i t a r y p u r p o s e s 2 9 . Of more s i g n i f i c a n c e was t h e n e e d f o r a p r o t e c t e d i n l a n d s u p p l y r o u t e . T h i s h i g h w a y w o u l d n o t o n l y be a s t r a t e g i c y e a r r o u n d f r e i g h t l i n k b e t w e e n A l a s k a and c o n t i n e n t a l USA b u t w o u l d , a s w e l l , s u p p l y W h i t e h o r s e a n d o t h e r m i l i t a r y a i r f i e l d s a l o n g t h e j o i n t US/Canada N o r t h w e s t S t a g i n g R o u t e . On F e b r u a r y 2/1942, t h e U n i t e d S t a t e s War D e p a r t m e n t o r d e r e d an i m m e d i a t e s u r v e y a n d c o n s t r u c t i o n p l a n f o r a m i l i t a r y r o a d t o A l a s k a 3 0 . A c t u a l c o n s t r u c t i o n o f t h e A l a s k a H i g h w a y began on M a r c h 1 0 t h o f t h e same y e a r and c o m p l e t i o n was o n l y n i n e m onths l a t e r on November 20/1942. 2 8 YUKON ECONOMIC REVIEW - E c o n o m i c R e s e a r c h a n d P l a n n i n g U n i t ( 1 9 8 T 5 2 9 t h e C a n o l o i l p i p e l i n e l i n k e d an o i l s o u r c e (Norman W e l l s ) w i t h W h i t e h o r s e - i t was a b a n d o n e d s h o r t l y a f t e r t h e war 3 0 YUKON TRANSPORTATION: A HISTORY - B e n n e t t , G o r d o n - ( 1 9 7 8 ) 33 F o l l o w i n g a l i n e o f l e a s t r e s i s t a n c e , t h e h i g h w a y d e t o u r e d a r o u n d swamps, r o c k k n o l l s , a n d o t h e r o b s t r u c t i o n s . C r e a t e d was a m i l i t a r y r o a d o f e x t r e m e l y p o o r h o r i z o n t a l a n d v e r t i c a l a l i g n m e n t . The m i l i t a r y h ad r e q u e s t e d : "an a l i g n m e n t t h a t w o u l d e n s u r e c o m p l e t i o n o f t h e r o a d a s a p r a c t i c a l m i l i t a r y h i g h w a y i n t h e minimum p o s s i b l e t i m e e m p l o y i n g t h e maximum f o r c e s and e q u i p m e n t . " ( B e n n e t t ( 1 9 7 8 ) p.132) S c h e d u l e d bus s e r v i c e was e s t a b l i s h e d b e t w e e n Dawson C r e e k and W h i t e h o r s e i n November 1943. However i t was n o t u n t i l A p r i l 1/1946, a f t e r j u r i s d i c t i o n was t r a n s f e r r e d t o C a n a d a , t h a t t h e A l a s k a H i g h w a y was o p e n e d t o a l l c a t e g o r i e s o f t r a f f i c ( B e n n e t t ( 1 9 78) p . 1 3 8 ) . The o p e n i n g was v i e w e d w i t h g r e a t a n t i c i p a t i o n by w h o l e s a l e r s i n t h e Edmonton a r e a a s a new a n d p o t e n t i a l l y l u c r a t i v e m a r k e t . E x c i t m e n t q u i c k l y f a d e d . I t became a p p a r e n t t h a t t h e s a v i n g s due t o s l i g h t l y l o w e r w h o l e s a l e p r i c e s i n Edmonton w e r e , f o r most c o m m o d i t i e s , i n a d e q u a t e t o c o m p e n s a t e f o r t h e h i g h c o s t o f t r u c k i n g r e l a t i v e t o t h e r a i l a l t e r n a t i v e ( B e n n e t t ( 1 9 78) p . 1 3 9 ) . T o t a l f r e i g h t t o n n a g e c a r r i e d a l o n g t h e e n t i r e r o u t e i n 1947 t o t a l l e d o n l y 26,600 t o n s . D u r i n g t h e 1 9 5 0 ' s , t h e Y u k o n ' s h i g h w a y n e t w o r k u n d e r w e n t a s i g n i f i c a n t e x p a n s i o n . The W h i t e h o r s e - M a y o r o a d was c o m p l e t e d i n 1950 a f t e r y e a r s o f l o b b y i n g by t h e l o c a l m i n i n g i n d u s t r y . T h i s a l l w e a t h e r t r u c k r o u t e w o u l d be u s e d t o t r a n s p o r t o r e f r o m t h e Keno H i l l m i n e , l o c a t e d j u s t 34 n o r t h o f t h e community o f Mayo. I n 1954, J o h n D i e f e n b a k e r s t a t e d : " T r a n s p o r t a t i o n i s t h e key t o d e v e l o p m e n t o f t h e n o r t h " T h e s e w o r d s spawned t h e f e d e r a l "Roads t o R e s o u r c e s " P r o g r a m ( 1 9 5 7 ) and t h e c o n s t r u c t i o n o f s e v e r a l h i g h w a y s i n n o r t h e r n Canada d u r i n g t h e l a t t e r 1950's and 1 9 6 0 ' s . H i g h w a y s c o n s t r u c t e d u n d e r t h i s a n d t h e " N o r t h e r n Roads ( 1 9 6 5 ) P r o g r a m " were d e s i g n e d p r i m a r i l y t o p r o m o t e t h e n o r t h e r n m i n i n g i n d u s t r y a n d i n c l u d e d : 1. Dempster H i g h w a y - o p e n e d i n 1979 l i n k s t h e K l o n d i k e Highway n e a r Dawson C i t y w i t h t h e M a c k e n z i e D e l t a 2. M a c k e n z i e H i g h w a y - when c o m p l e t e d w i l l r u n a l o n g t h e M a c k e n z i e R i v e r a n d i s d e s i g n e d a s an a l t e r n a t i v e t o b a r g e t r a n s p o r t a t i o n - c o n s t r u c t i o n i s v i r t u a l l y n o n - e x i s t a n t a t t h i s t i m e 3. S o u t h C a n o l Road - r e c o n s t r u c t e d b e t w een J o h n s o n ' s C r o s s i n g a nd R o s s R i v e r - c u r r e n t l y a summer h i g h w a y o n l y 4. R o b e r t C a m p b e l l H i g h w a y - l i n k s C a r m a c k s , F a r o , R o s s R i v e r , a n d Watson L a k e - now a l i n k i n t h e t r a n s p o r t s y s t e m w h i c h c a r r i e s C y p r u s A n v i l ' s l e a d / z i n c o r e t o t i d e w a t e r a t Skagway 5. N a h a n n i Range Road - c o n s t r u c t e d i n t h e e a r l y 1960's b e t w e e n t h e R o b e r t C a m p b e l l H i g h w a y , n o r t h o f W a t s o n L a k e , and t h e m i n i n g town of T u n g s t e n , NWT M i n i n g c o m p a n i e s were a t t r a c t e d t o t h e a r e a n o t o n l y a s a r e s u l t o f t h e i m p r o v e d t r a n s p o r t a t i o n f a c i l i t i e s b u t by 35 d i r e c t f e d e r a l f i n a n c i a l i n c e n t i v e s a s w e l l . C y p r u s A n v i l ' s l e a d / z i n c mine i n F a r o began o p e r a t i o n s i n 1969 a f t e r f e d e r a l a s s i s t a n c e was p r o v i d e d f o r c o n s t r u c t i o n o f t h e m i n e s i t e and company town. W h i t e h o r s e C o p p e r began p r o d u c t i o n two y e a r s e a r l i e r u n d e r t h e i n f l u e n c e o f a s i m i l a r i n c e n t i v e s p a c k a g e 3 1 . Canada T u n g s t e n ' s o p e r a t i o n s came on s t r e a m i n 1962 upon c o m p l e t i o n o f t h e f e d e r a l l y f u n d e d N a h a n n i Range Road. As Y u k o n ' s h i g h w a y n e t w o r k was d e v e l o p i n g , i t s s e a s o n a l w a t e r w a y s y s t e m , o n c e t h e p r i m a r y f o r m o f i n l a n d t r a n s p o r t a t i o n i n t h e t e r r i t o r y , q u i c k l y d i s a p p e a r e d . S t e r n w h e e l e r s , o f w h i c h 250 e x i s t e d i n t h e Yukon b e t w e e n t h e l a t e 1860's and 1 9 5 0 ' s , were c o n t i n u a l l y p h a s e d o u t u n t i l t h e l a s t r i v e r b o a t , K l o n d i k e 11, was r e t i r e d i n 1955. S e t t l e m e n t p a t t e r n s were u n d e r g o i n g a c h a n g e away f r o m r e g i o n a l w a t e r w a y s t o c r o s s r o a d s a n d h i g h w a y i n t e r s e c t i o n s . F o r t S a i n t J o h n , W a t s o n L a k e , a n d F o r t N e l s o n d e v e l o p e d a s t r a n s p o r t a t i o n c e n t r e s by s e r v i c i n g t h e t r u c k i n g and n ewborn t o u r i s m i n d u s t r i e s . More r e c e n t d e v e l o p m e n t s i n n o r t h e r n B r i t i s h C o l u m b i a i n c l u d e c o m p l e t i o n o f t h e B.C. R a i l w a y F o r t N e l s o n e x t e n s i o n ( 1 9 7 1 ) a n d o p e n i n g o f t h e S t e w a r t C a s s i a r H i g h w a y t o t h r o u g h t r a f f i c ( 1 9 7 6 ) . B o t h r o u t e s c o m p e t e d i r e c t l y w i t h t h e A l a s k a H i g h w a y a n d a r e d e t a i l e d i n s e c t i o n 2.7 o f 1981 Yukon M i n i n g F a c t S h e e t 36 t h i s r e p o r t . R a p i d a d v a n c e s i n t e c h n o l o g y a n d g e n e r a l o p e r a t i o n a l e f f i c i e n c y h ave c o n t i n u o u s l y i n c r e a s e d t h e a t t r a c t i v e n e s s o f a i r and w a t e r c a r r i e r s o p e r a t i n g i n n o r t h e r n r e g i o n s a n d ha v e a c c o r d i n g l y l e s s e n e d t h e r e l i a n c e on t h e A l a s k a H i g h w a y . The c o s t o f a i r t r a v e l b e t w e e n t h e s o u t h a n d F a i r b a n k s o r W h i t e h o r s e h a s d e c r e a s e d s i g n i f i c a n t l y i n r e a l t e r m s s i n c e 1960, w h i l e f r e q u e n c y o f s e r v i c e a n d c o m f o r t l e v e l s h ave been r i s i n g . S e a l a n d o p e r a t e s a h i g h l y e f f i c i e n t c o n t a i n e r s h i p s e r v i c e b e t w e e n S e a t t l e a n d A l a s k a . W i t h a g g r e s s i v e management and s t a t e - o f - t h e - a r t t e c h n o l o g y , t h i s s y s t e m h a s d i v e r t e d most c o n t i n e n t a l USA -A l a s k a f r e i g h t t r a f f i c away f r o m t h e A l a s k a H i g h w a y 3 2 . The A l a s k a H i g h w a y i t s e l f h a s been s u b j e c t t o c o n s i d e r a b l e u p g r a d i n g e f f o r t s d u r i n g r e c e n t y e a r s . B e t ween 1972 and 1977, an a n n u a l e x p e n d i t u r e o f $11,300,000 was a l l o c a t e d t o t h e h i g h w a y . I n 1977, t h i s f i g u r e was i n c r e a s e d t o $18,000,000 and was s p e c i f i c a l l y d e s i g n e d t o " p r o v i d e a r e a s o n a b l e l e v e l o f s e r v i c e on t h e h i g h w a y a n d .... S a t i s f y t h e l o c a l i n h a b i t a n t s t h a t a c o n t i n u i n g p r o g r a m i s u n d e r w a y " 3 3 . 3 2 f r o m c o r r e s p o n d a n c e w i t h LYNDEN TRANSPORTATION, S e a t t l e , W a s h i n g t o n 3 3 THE C I V I L I A N HIGHWAY by Ken C o a t e s ( 1 982) 37 T r a f f i c v o l u m e s a l o n g t h i s r o u t e have u n d e r g o n e a v e r a g e a n n u a l g r o w t h r a t e s r a n g i n g b e t w e e n 0% and 8% d e p e n d i n g on l o c a t i o n . P r o j e c t e d f u t u r e g r o w t h r a t e s a r e s u b j e c t t o h i g h l e v e l s o f u n c e r t a i n t y a s w i l l be d e t a i l e d i n C h a p t e r 5. P r i m a r y f a c t o r s u n d e r l y i n g t h i s u n c e r t a i n t y i n c l u d e : - t h e r e l a t i v e a t t r a c t i v e n e s s o f a l t e r n a t i v e r o u t e s a n d modes i n f u t u r e y e a r s - t h e e x t e n t t o w h i c h a l t e r n a t i v e s a r e p r o m o t e d t o p o t e n t i a l u s e r s a s b e i n g f e a s i b l e a l t e r n a t i v e s - r e g i o n a l p o p u l a t i o n g r o w t h t r e n d s - f u t u r e l e v e l s o f e c o n o m i c a c t i v i t y D e s c r i p t i o n s o f o t h e r r o u t e s / m o d e s a r e p r o v i d e d i n t h e f o l l o w i n g s e c t i o n . •• 2.7 COMPETING/COMPLIMENTARY ROUTES AND MODES W i t h r a r e e x c e p t i o n s , t r a f f i c v o l u m e s a l o n g t r a n s p o r t c o r r i d o r s s e r v i n g n o r t h w e s t Canada a r e s u b j e c t t o e x t r e m e f l u c t u a t i o n s a n d a r e v u l n e r a b l e t o t h e d e v e l o p m e n t o r u p g r a d i n g o f a l t e r n a t i v e s . The A l a s k a H i g h w a y i s e s p e c i a l l y s e n s i t v e t o t h e s e f a c t o r s . T h i s s e c t i o n o u t l i n e s a n d d e s c r i b e s e x i s t i n g r o u t e s a n d modes w h i c h e i t h e r c o m p e t e w i t h o r complement t h e A l a s k a 38 H i g h w a y . The i n f o r m a t i o n w i l l be u s e d i n C h a p t e r 5 t o a c t u a l l y . p r o j e c t t r a f f i c v o l u m e s a l o n g t h i s c o r r i d o r u n d e r e a c h o f l o w , mean e s t i m a t e , a n d h i g h g r o w t h s c e n a r i o s . • 2.7.1 W a t e r : The A l a s k a M a r i n e H i g h w a y , B.C. F e r r y C o r p o r a t i o n , a nd a number o f p r i v a t e l y owned c r u i s e l i n e s p r o v i d e p a s s e n g e r and v e h i c l e t r a n s p o r t a t i o n a l o n g t h e n o r t h w e s t c o a s t o f N o r t h A m e r i c a . W h i t e P a s s & Yukon c o n t a i n e r s h i p p i n g s e r v i c e s and A r r o w T r a n s p o r t a t i o n S y s t e m s b a r g e s p r o v i d e t h e means t o move c o n s i d e r a b l e v o l u m e s o f g e n e r a l a n d b u l k f r e i g h t t o t h e Y u k o n . S e a - L a n d L i m i t e d p r o v i d e s a s i m i l a r b u t l a r g e r s c a l e c o n t a i n e r s h i p p i n g s e r v i c e b e tween t h e w e s t c o a s t o f c o n t i n e n t a l USA a n d A l a s k a . The M a c k e n z i e R i v e r i s t h e p r i m a r y s h i p p i n g r o u t e f o r g e n e r a l a n d b u l k f r e i g h t b e t w e e n t h e s o u t h a n d M a c k e n z i e D e l t a . F i n a l l y , t h e p o t e n t i a l e x i s t s f o r s u p p l y i n g t h e e n t i r e B e a u f o r t Sea v i a i c e b r e a k i n g t a n k e r s . 2.7.1.1 The A l a s k a M a r i n e H i g h w a y : T h i s A l a s k a S t a t e c o n t r o l l e d w e s t c o a s t f e r r y s y s t e m p r o v i d e s v e h i c l e a c c e s s t o n o r t h e r n d e s t i n a t i o n s t h e r e b y e l i m i n a t i n g t h e n e e d t o d r i v e t h e e n t i r e n o r t h - s o u t h r o u t e . A l t h o u g h d e t a i l e d r e s e a r c h on t h i s t o p i c i s n o n -e x i s t a n t , i t i s b e l i e v e d t h e s e r v i c e s a r e u s e d e x t e n s i v e l y a s one l i n k i n a v a r i e t y o f t o u r i s t c i r c l e r o u t e s . A d e s c r i p t i o n o f t h e s e r o u t e s p l u s a r o u g h 39 c o s t i n g a n a l y s i s o f c i r c l e r o u t e s i n c o r p o r a t i n g f e r r y s e r v i c e s v e r s e s t h e d r i v e - o n l y a l t e r n a t i v e a r e p r o v i d e d i n A p p e n d i x I V . F o r one o r two p e r s o n s , t h e e a s i l y q u a n t i f i e d c o s t s o f f e r r y i n g b e t w e e n S e a t t l e a n d H a i n e s / S k a g w a y a r e a p p r o x i m a t e l y e q u a l t o c o s t s i n c u r r e d i n t h e d r i v e - o n l y a l t e r n a t i v e . F o r a f a m i l y o f f o u r , t h e f e r r y o p t i o n i s r o u g h l y $300 more. However t h e A l a s k a M a r i n e H i g h w a y p r o v i d e s a t i m e s a v i n g s o f 60 h o u r s p e r p e r s o n w h i c h has n o t been i n c l u d e d i n t h e r e l a t i v e c o s t s d i s c u s s e d a b o v e . I n a d d i t i o n , t h e s e a r o u t e w o u l d be s i g n i f i c a n t l y more s c e n i c and l e s s s t r e s s f u l t o most t r a v e l l e r s . A c i r c l e r o u t e w h i c h i n c o r p o r a t e s t h e s h o r t e r P r i n c e R u p e r t - H a i n e s / S k a g w a y f e r r y l i n k i s r o u g h l y $100 t o $200 more c o s t l y r e l a t i v e t o t h e d r i v e - o n l y a l t e r n a t i v e a n d o f f e r s l i t t l e , i f a n y , t i m e s a v i n g s . B u t a g a i n , t h e u n q u a n t i f i e d b e n e f i t s i n c l u d i n g s u p e r i o r s c e n e r y and r e d u c e d s t r e s s d e f i n i t e l y f a v o u r t h e f e r r y a l t e r n a t i v e . T h e s e may be s i g n i f i c a n t f a c t o r s i n a t o u r i s t ' s d e c i s i o n m a k i n g p r o c e s s . A l t h o u g h o r i g i n / d e s t i n a t i o n d a t a r e l e v a n t t o t h i s M a r i n e H i g h w a y s e r v i c e h a v e been made a v a i l a b l e by A l a s k a S t a t e , t h e y do n o t r e l a t e o r i g i n s and d e s t i n a t i o n s on a p a s s e n g e r t r i p b a s i s . T h a t i s , e m b a r k i n g a n d d i s e m b a r k i n g v o l u m e s a r e l i s t e d by p o r t , b u t i t i s n o t known t o w h i c h p o r t p a s s e n g e r s who 40 embark i n one l o c a t i o n a r e d e s t i n e d . More d e t a i l e d a n d c o n c l u s i v e o r i g i n - d e s t i n a t i o n d a t a , a l o n g w i t h q u e s t i o n n a i r e s o r i n - d e p t h i n t e r v i e w s w i t h u s e r s o f t h e M a r i n e H i g h w a y , w o u l d c o n t r i b u t e c o n s i d e r a b l y t o t h e u n d e r s t a n d i n g o f t h i s t r a f f i c a n d t h e p o t e n t i a l o f i t s d i v e r s i o n t o o r f r o m t h e A l a s k a H i g h w a y . I t i s known t h a t , w i t h t h e e x c e p t i o n o f one y e a r i n t h e m i d 1970's when t h e f u e l s h o r t a g e was p a r t i c u l a r l y s e v e r e , t h e S e a t t l e f e r r y l i n k h a s o p e r a t e d a t f u l l c a p a c i t y d u r i n g summer months and t h a t r e s e r v a t i o n s must be made c o n s i d e r a b l y i n a d v a n c e o f t h e s c h e d u l e d s a i l i n g d a t e 3 " . Volume on t h i s r o u t e c a n t h e r e f o r e be c o n s i d e r e d t o be c a p a c i t y r a t h e r t h a n demand d e t e r m i n e d . D a t a f o r t h i s a n d t h e P r i n c e R u p e r t l i n k a r e a s l i s t e d i n TABLE 2 ~ 4 3 5 . The e x t e n t t o w h i c h *************** TABLE 2—4 ****************** FERRY VOLUMES AT WEST COAST PORTS (PERSONS/VEHICLES) PORT EMBARKING DISEMBARKING ************** ************ ************ PRINCE RUPERT 19000/5600 19500/5530 HAINES 30000/9700 28000/9000 SKAGWAY 21000/3500 24000/4000 ALL OTHER PORTS 74000/16500 78500/19200 ******************************************** 41 M a r i n e H i g h w a y p a s s e n g e r s a r e p o t e n t i a l l y d i v e r t a b l e t o o r f r o m t h e A l a s k a H i g h w a y i s h i g h l y u n c e r t a i n . However g i v e n t h a t more i n f o r m e d e s t i m a t e s o f t h e number o f f e r r y p a s s e n g e r s t h a t u s e t h e s e r v i c e a s an a l t e r n a t i v e t o t h e A l a s k a H i g h w a y do n o t e x i s t , my e s t i m a t e s a r e a s l i s t e d i n TABLE 2-5. The f u t u r e o f **************** TABLE 2~5 ************************ ESTIMATES OF POTENTIALLY DIVERTABLE FERRY VOLUME ROUTE % OF FERRY # EQUIVILENT ONE-WAY VOLUME VE H I C L E - T R I P S ***** ********** ******************** S e a t t l e - H a i n e s / S k a g w a y 6 0 % 7500 P . R u p e r t - H a i n e s / S k a g w a y 4 0 % 4400 T o t a l 11,900 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * t h i s a l t e r n a t i v e a n d c o r r e s p o n d i n g i m p a c t on A l a s k a H i g h w a y v o l u m e s i s d i s c u s s e d i n C h a p t e r 5. 42 2.7.1.2 West C o a s t C r u i s e s h i p S e r v i c e s : F o u r c r u i s e s h i p c o m p a n i e s o f f e r a v a r i e t y o f h i g h c o s t / s h o r t d u r a t i o n i n s i d e p a s s a g e t o u r s b e t w e e n San F r a n c i s c o / V a n c o u v e r and c o m m u n i t i e s a l o n g t h e A l a s k a P a n h a n d l e 3 6 . P o p u l a r s i d e a t t r a c t i o n s a v a i l a b l e t o most p a s s e n g e r s a r e day o r h a l f day bus t o u r s b e t w e e n Skagway and C a r c r o s s o r W h i t e h o r s e . A l t h o u g h t h i s i s a m a j o r i n d u s t r y w i t h a n n u a l t o t a l p a s s e n g e r v o l u m e s i n t h e t e n s of t h o u s a n d s , i t i s my o p i n i o n t h a t l i t t l e d i v e r s i o n p o t e n t i a l e x i s t s b e t w e e n t h i s s e r v i c e and A l a s k a H ighway t o u r i s m . U n l i k e t h e A l a s k a H i g h w a y M a r i n e s e r v i c e s w h i c h o p e r a t e a l o n g e s s e n t i a l l y t h e same r o u t e , no f a c i l i t i e s e x i s t f o r s h i p p i n g v e h i c l e s . I n a d d i t i o n , o p p o r t u n i t i e s f o r l o n g e r t e r m v i s i t s t o e i t h e r t h e Yukon o r A l a s k a a r e g e n e r a l l y n o t p r o v i d e d . 2.7.1.3 C o a s t a l C o n t a i n e r S h i p / R a i l S e r v i c e : T h i s s y s t e m i n c o r p o r a t e s c o n t a i n e r s h i p s b e t w e e n N o r t h V a n c o u v e r and Skagway, a n a r r o w guage 180 k i l o m e t e r r a i l w a y and p e t r o l e u m p i p e l i n e b e t w e e n Skagway and W h i t e h o r s e , a s w e l l a s a f l e e t o f h i g h w a y v e h i c l e s b e t w e e n W h i t e h o r s e a n d o t h e r Yukon d e s t i n a t i o n s . The m u l t i - m o d a l s e r v i c e , o p e r a t e d by W h i t e P a s s a n d Yukon C o r p o r a t i o n , h a s u n d e r g o n e a number o f t e c h n o l o g i c a l 6 C o m p a n i e s i n c l u d e H o l l a n d A m e r i c a C r u i s e s , I n c . ; P r i n c e s s C r u i s e s ; S i t m a r C r u i s e s ; a n d W e s t o u r s I n c . - c r u i s e s t y p i c a l l y r a n g e b e t w e e n 7 a n d 12 d a y s d u r a t i o n w i t h f a r e s f r o m $920 p e r p e r s o n 43 i n n o v a t i o n s s i n c e i t s c o n c e p t i o n i n 1899. An a g g r e s s i v e management team l a u n c h e d t h e w o r l d ' s f i r s t c o n t a i n e r s h i p , t h e C l i f f o r d R o g e r s , i n 1 9 5 5 3 7 . I n 1965 a n d 1969, t h e c o r p o r a t i o n l a u n c h e d two t e c h n o l o g i c a l l y a d v a n c e s e l f u n l o a d i n g 6900 t o n c o n t a i n e r v e s s e l s , e a c h w i t h wet and d r y b u l k c a p a b i l i t y . The s e r v i c e became more a t t r a c t i v e i n 1969 when s e r v i c e f r e q u e n c y was i n c r e a s e d t o w e e k l y f r o m b i - w e e k l y . I n 1980, t r a n s i t t i m e b e t w e e n V a n c o u v e r and W h i t e h o r s e t y p i c a l l y r a n g e d b e t w e e n 5 and 9 d a y s c o m p a r e d t o 3 d a y s by t r u c k v i a t h e A l a s k a H i g h w a y 3 8 . However t h e t a r i f f f o r g e n e r a l f r e i g h t was r o u g h l y t w o - t h i r d s t h a t o f t h e t r u c k i n g a l t e r n a t i v e 3 9 . W h i t e P a s s was t h e r e f o r e a b l e t o s e c u r e much o f t h e V a n c o u v e r o r i g i n a t e d g e n e r a l f r e i g h t t r a f f i c a n d v i r t u a l l y a l l o f Y u k o n ' s o u t b o u n d o r e t r a f f i c . T r a f f i c c a r r i e d i n 1979 t o t a l l e d 550,000 t o n s . TABLE 2-6 l i s t s t h i s v o l u m e by f r e i g h t c a t e g o r y " 0 . A l t h o u g h a p p e a r i n g somewhat h i g h by o t h e r i n d i c a t i o n s , Swan W o o s t e r E n g i n e e r i n g Co. L t d e s t i m a t e d t h a t t h i s s y s t e m c a r r i e d 8 5 % o f a l l g e n e r a l f r e i g h t a n d 90% o f a l l p e t r o l e u m 3 7 YUKON TRANSPORTATION: A HISTORY - G o r d o n B e n n e t t ( 1 9 7 8) 3 8 B a s e d on c o n v e r s a t i o n w i t h r e p r e s e n t a t i v e s o f W h i t e P a s s & Y u kon C o r p . And Yukon F r e i g h t l i n e s L t d . 3 9 $8.90 cwt v s . $14.10 cwt f r o m V a n c o u v e r - 5000 l b . Minimum ( 1 9 8 0 ) "° REPORT OF THE INQUIRY INTO THE WHITE PASS AND YUKON RAILWAY  AND OTHER SURFACE TRANSPORTATION SERVICES INTO AND OUT OF THE YUKON - 1980 ************* TABLE 2 — 6 *************** RAIL AND BARGE VOLUME -WHITE PASS AND YUKON CORPORATION ( TONS CARRIED - 197 9 ) COMMODITY NORTHBOUND SOUTHBOUND g e n e r a l f r e i g h t 72,460 4,236 b u l k p e t r o l e u m 37,037 C a s s i a r a s b e s t o s -- 9,658 C o n c e n t r a t e s : - A n v i l -- 406,988 - UKHM -- 7,406 - W h i t e h o r s e C o p p e r -- 18,695 T o t a l 109,037 446,983 *************************************** p r o d u c t s s h i p p e d i n t o t h e Yukon i n 1 9 7 8 " 1 . However a s e r i e s o f p r o b l e m s h a v e p l a g u e d W.P.& Y. C o r p o r a t i o n s i n c e 1977. T h e s e i n c l u d e : - C a s s i a r A s b e s t o s C o r p o r a t i o n , a m a j o r c u s t o m e r o f t h e W h i t e P a s s C o r p o r a t i o n f o r 20 y e a r s , c l o s e d i t s C l i n t o n C r e e k M i n e i n 1978 - A r r o w T r a n s p o r t a t i o n S y s t e m s won a 5 y e a r c o n t r a c t away f r o m W.P.&Y. C o r p o r a t i o n t o move o r e f r o m t h e C a s s i a r , B r i t i s h C o l u m b i a , m i n e s i t e v i a YUKON TRANSPORTATION STUDY - Swan W o o s t e r E n g i n e e r i n g ( 1 9 7 8) 45 t h e n e w l y o p e n e d S t e w a r t - C a s s i a r H i g h w a y . As a r e s u l t , W h i t e P a s s ' s a s b e s t o s t r a f f i c f e l l t o 10,000 t o n s p e r annum i n 1979 f r o m 165,000 i n 1977. T o t a l W.P.& Y. C o r p o r a t i o n r e v e n u e s f e l l 18% a s a r e s u l t . - The C a n a d i a n d o l l a r f e l l i n v a l u e r e l a t i v e t o A m e r i c a n c u r r e n c y . A l t h o u g h W.P.& Y. C o r p o r a t i o n r e v e n u e s were i n C a n a d i a n d o l l a r s , much o f i t s e x p e n s e s were p a i d i n A m e r i c a n c u r r e n c y " 2 . - The r a i l w a y d i v i s i o n was e x p e r i e n c i n g numerous d e r a i l m e n t s . - I n d u s t r i a l r e l a t i o n s w o r s e n e d a n d wage s c a l e s p r o g r e s s e d t o a l e v e l s i g n i f i c a n t l y a b o v e t h o s e o f o t h e r C a n a d i a n r a i l w a y s . F o r e x a m p l e , 1979 wage r a t e s were $20.29 p e r h o u r f o r a Skagway s e c t i o n f o r e m a n c o m p a r e d t o $8.30 p e r h o u r f o r a CP/CN f o r e m a n d o i n g e s s e n t i a l l y t h e same w o r k " 3 . " 2 159 o f W.P.&.Y. C o r p o r a t i o n ' s 213 r a i l w a y e m p l o y e e s r e s i d e i n Skagway, A l a s k a 46 The u p g r a d i n g o f t h e K l o n d i k e Road b e t w e e n C a r c r o s s a n d Skagway a n d s u b s e q u e n t o p e n i n g t o summer r e c r e a t i o n a l t r a f f i c r e d u c e d r a i l p a s s e n g e r v o l u m e f r o m 74,000 i n 1978 t o 46,000 i n 1979. P a s s e n g e r t r a f f i c h a d a c c o u n t e d f o r 19% of t o t a l r e v e n u e ( W h i t e P a s s I n q u i r y ( 1 9 8 0 ) p. 67 ) . A l t h o u g h l o s i n g $3,000,000 p e r annum d u r i n g 1980 a n d 1981, W.P.&Y. C o r p o r a t i o n m a i n t a i n e d s e r v i c e s . I t was a n t i c i p a t e d t h a t f e d e r a l f i n a n c i a l a s s i s t a n c e i n t h e f o r m o f s u b s i d i e s w o u l d be f o r t h c o m i n g a n d t h a t i n c r e a s e d t r a f f i c v o l u m e s w o u l d d e v e l o p i n t h e n e a r f u t u r e " 1 1 . T h e s e h o p e s were n o t r e a l i z e d . I n J u n e 1982, C y p r u s A n v i l c l o s e d i t s F a r o l e a d / z i n c o p e r a t i o n s . W h i t e P a s s c o u l d no l o n g e r o p e r a t e w i t h o u t t h e l e a d / z i n c c o n c e n t r a t e s s o u r c e d f r o m t h i s mine a n d , a s a r e s u l t , s u s p e n d e d s e r v i c e s f o r an i n d e f i n i t e p e r i o d a t t h e end o f S e p t e m b e r o f t h e same y e a r . The t e r m i n a t i o n o f W.P.& Y. C o r p o r a t i o n o p e r a t i o n s i s v i e w e d i n t h i s r e p o r t t o c o n s t i t u t e a t e m p o r a r y 4 3 INQUIRY INTO THE WHITE PASS AND YUKON RAILWAY - C.T.C - ( 1 9 8 0 ) a p p e n d i c e s 3 a n d 4 "" THE VANCOUVER SUN 10/04/82 47 i n t e r u p t i o n i n s e r v i c e s r a t h e r t h a n a p e r m a n e n t o r l o n g t e r m c l o s u r e . T h i s i s s u e w i l l be e x p a n d e d upon, a l o n g w i t h a d i s c u s s i o n o f t h e p o t e n t i a l i m p a c t s on A l a s k a H ighway c o m m e r c i a l t r a f f i c v o l u m e , i n s e c t i o n 5.3 o f c h a p t e r 5. 2.7.1.4 S e a - L a n d C o n t a i n e r S e r v i c e s : A t e c h n o l o g i c a l l y a d v a n c e d h i g h s p e e d c o n t a i n e r s h i p p i n g s e r v i c e i s p r o v i d e d by S e a - L a n d C o r p o r a t i o n b e t w e e n S e a t t l e and A n c h o r a g e , A l a s k a . The A l a s k a m a r k e t i s s u f f i c i e n t l y l a r g e t o p e r m i t a h i g h l e v e l o f s e r v i c e i n t e r m s o f f r e q u e n c y o f d e p a r t u r e . T h i s , c o m b i n e d w i t h t r a n s i t t i m e s o f r o u g h l y 2 d a y s , y i e l d s l o g i s t i c a l f l e x i b i l i t y f o r s h i p p e r s . The l o w c o s t o f t h i s s e r v i c e r e l a t i v e t o t h a t o f t h e t r u c k i n g a l t e r n a t i v e a d d s c o n s i d e r a b l e t o t h e a t t r a c t i v e n e s s o f S e a - L a n d s e r v i c e s . An e x a m p l e o f t h e r e l a t i v e c o s t s a n d d o o r - t o - d o o r t r a n s i t t i m e s f o r a h y p o t h e t i c a l s h i p p m e n t b e t w e e n V a n c o u v e r and F a i r b a n k s , A l a s k a i s a s f o l l o w s " 5 : 5 C a n a d i a n F r e i g h t w a y s h a s n o t c a r r i e d a n y f r e i g h t t o A l a s k a s i n c e 1977 b u t o f f e r s t h e s e c o m p a r a t i v e t a r i f f s f o r a h y p o t h e t i c a l s h i p m e n t i n 1981. 48 V a n c o u v e r — t r u c k -** F a i r b a n k s : $ 5 0 0 0 / c o n t a i n e r 3-5 d a y s ************** ******** V a n c o u v e r — t r u c k * S e a t t l e — s h i p A n c h o r a g e -*-r a i l — F a i r b a n k s : $ 3 0 0 0 / c o n t a i n e r 7-14 d a y s ************** ********* S h i p m e n t s o r i g i n a t i n g i n S e a t t l e o r t e r m i n a t i n g i n A n c h o r a g e c o u l d be c a r r i e d u n d e r s i g n i f i c a n t l y l o w e r t a r i f f s t h a n t h o s e i n d i c a t e d a b o v e i f t h e S e a - L a n d a l t e r n a t i v e were c h o s e n . The e f f e c t o f t h i s s e r v i c e h a s been t o d i v e r t v i r t u a l l y a l l A l a s k a d e s t i n e d t r a f f i c away f r o m t h e A l a s k a H i g h w a y . F o r e x a m p l e , L y n d e n T r a n s p o r t , t h e l a r g e s t m o t o r c a r r i e r t o , f r o m , a n d w i t h i n A l a s k a , s e n t 88 u n i t s p e r week t o A l a s k a i n 1975. I n c o n t r a s t , t h e company r a n a t o t a l o f 120 t r i p s o v e r t h e A l a s k a H i g h w a y i n 1 9 8 2 " 6 . I t p r o j e c t s t h a t c u r r e n t v o l u m e t o A l a s k a v i a t h e A l a s k a H i g h w a y w i l l c o n t i n u e f o r t h e f o r s e e a b l e f u t u r e . The o p e r a t i o n s p e c i f i c a l l y r e s p o n s i b l e f o r t h i s t r a f f i c d i v e r s i o n was c o n c e i v e d by L y n d e n T r a n s p o r t i n 1976 and l a b e l l e d t h e " A l a s k a M a r i n e H i g h w a y " . L y n d e n ' s v i c e p r e s i d e n t i n c h a r g e o f o p e r a t i o n s s t a t e d : " s i n c e t h e s t a r t o f o u r w a t e r d i v i s i o n , o u r A l c a n t r i p s t o A l a s k a h a v e d e c l i n e d s t e a d i l y " The a t t r a c t i v e n e s s o f t h i s m a r i n e a l t e r n a t i v e i s s u c h 6 b a s e d on d i s c u s s i o n s w i t h J i m B e c k , V i c e P r e s i d e n t o f O p e r a t o n s , L y n d e n T r a n s p o r t I n c . , S e a t t l e , W a s h i n g t o n 49 t h a t i t i s h i g h l y l i k e l y t o c o n t i n u e and e x p a n d . The a s s o c i a t e d i m p a c t on A l a s k a H i g h w a y v o l u m e s i s d i s c u s s e d i n s e c t i o n 5.3 o f c h a p t e r 5. 2.1.7.5. M a c k e n z i e B a r g e / R a i l / T r u c k S e r v i c e s : V i r t u a l l y a l l of M a c k e n z i e D e l t a ' s b u l k a n d g e n e r a l f r e i g h t r e q u i r e m e n t s a r e s h i p p e d f r o m s o u t h e r n s u p p l y c e n t r e s v i a t r u c k o r C . N . R a i l t o Hay R i v e r a n d f r o m t h e r e t o d e s t i n a t i o n by b a r g e v i a N o r t h e r n T r a n s p o r t a t i o n Company L t d . T h i s f e d e r a l c r o w n c o r p o r a t i o n t r a n s p o r t s 255,000 o f an e s t i m a t e d 300,000 t o t a l t o n n a g e t o t h e D e l t a on an a n n u a l b a s i s . V o l u m e s a l o n g t h i s r o u t e have r e m a i n e d f a i r l y s t a b l e f o r t h e p a s t s e v e r a l y e a r s " 7 . E q u i p m e n t c o n s i s t i n g o f 29 t u g s a n d 168 b a r g e s c a n be u s e d o n l y d u r i n g t h e p e r i o d J u n e t h r o u g h S e p t e m b e r when t h e M a c k e n z i e R i v e r i s f r e e o f i c e . S u p p l i e s a r e i n v e n t o r i e d a t v a r i o u s l o c a t i o n s i n t h e D e l t a a n d B e a u f o r t Sea a r e a s f o r u s e d u r i n g t h e p e r i o d when b a r g e s a r e n o t o p e r a t i o n a l . Some o f t h e more v a l u a b l e a n d p e r i s h a b l e c o m m o d i t i e s h i s t o r i c a l l y c a r r i e d v i a t h i s r o u t e h a v e been d i v e r t e d t o a r e l a t i v e l y new a l t e r n a t i v e , t h e D e m p s t e r H i g h w a y , w h i c h was o p e n e d i n 1979. S i n c e some o f t h e f r e i g h t moved v i a t h e D e m p s t e r must f i r s t be s h i p p e d n o r t h by b a s e d on c o r r e s p o n d e n c e w i t h N.T.C.L. R e p r e s e n t a t i v e 50 t r u c k o r c o a s t a l s h i p p i n g , A l a s k a H i g h w a y c o m m e r c i a l t r a f f i c f l o w s have been i n f l u e n c e d a c c o r d i n g l y . F o r e c a s t s o f f u t u r e v o l u m e a l o n g t h e D e m p s t e r H i g h w a y an d t h e p o t e n t i a l i m p a c t on A l a s k a H ighway t r a f f i c f l o w s a r e d i s c u s s e d i n s e c t i o n 5.3 o f c h a p t e r 5. • 2.7.2 HIGHWAYS: A number o f h i g h w a y r e c o n s t r u c t i o n p r o g r a m s a r e e i t h e r o n g o i n g o r p r o p o s e d i n n o r t h w e s t C a n a d a . P o t e n t i a l i m p a c t s t o A l a s k a H i g h w a y t r a f f i c v o l u m e s r a n g e f r o m b e i n g s u b s t a n t i a l , a s i s t h e c a s e w i t h H i g h w a y 37 ( S t e w a r t - C a s s i a r ) t o n e g l i g i b l e , a s i s t h e c a s e w i t h t h e L i a r d a n d M a c k e n z i e h i g h w a y s . 2.7.2.1. C a r c r o s s - S k a g w a y H i g h w a y : T h i s 110 k i l o m e t e r c o r r i d o r was o p e n e d i n 1979 a n d i s c u r r e n t l y m a i n t a i n e d a s a summer r o a d o n l y . J u s t i f i c a t i o n s f o r i t s c o n s t r u c t i o n i n c l u d e d : - i t w o u l d f a c i l i t a t e l o c a l t r a f f i c - i t w o u l d e n c o u r a g e t o u r i s m , a n d - i t w o u l d p r o v i d e a c o m p e t i t i v e means by w h i c h g e n e r a l f r e i g h t c o u l d be s h i p p e d t o W h i t e h o r s e and b e y o n d f r o m t i d e w a t e r a t Skagway B e i n g an a l t e r n a t i v e t o r a i l s e r v i c e f o r r e c r e a t i o n a l 51 t r a f f i c , t h i s h i g h w a y h a s c o n s i d e r a b l y e r o d e d W.P.&Y. C o r p o r a t i o n ' s p a s s e n g e r r a i l t r a f f i c r e v e n u e . Not o n l y h a v e 28,000 t o u r i s t s p e r y e a r been d i v e r t e d f r o m r a i l t o n e w l y d e v e l o p e d t o u r bus s e r v i c e s , b u t r e v e n u e a s s o c i a t e d w i t h t h e r a i l w a y ' s v e h i c l e t r a n s p o r t a t i o n s e r v i c e h a v e a l s o b een d i m i n i s h e d " 8 . T h e r e h a s r e c e n t l y been a g r e a t d e a l o f l o b b y i n g , p r i m a r i l y by C y p r u s A n v i l C o r p o r a t i o n , f o r t h e r e c o n s t r u c t i o n a n d u p g r a d i n g o f t h e C a r c r o s s - S k a g w a y h i g h w a y a s a y e a r r o u n d t r u c k i n g r o u t e . To do so w o u l d r e q u i r e $30,000,000 and a minimum c o n s t r u c t i o n p e r i o d o f 2 y e a r s " 9 . Once o p e n e d t o y e a r r o u n d t r a f f i c , m a i n t e n a n c e a nd snow r e m o v a l c o s t s ( t h e a r e a r e c e i v e s 500 i n c h e s o f snow a n n u a l l y ) w o u l d be s u b s t a n t i a l . I t i s a l s o g e n e r a l l y a g r e e d t h a t t h e h i g h w a y , o n c e u p g r a d e d , w o u l d d i v e r t s u f f i c i e n t g e n e r a l f r e i g h t v o l u m e away f r o m t h e W.P.& Y. R a i l w a y t h a t r a i l s e r v i c e w o u l d n e v e r be r e a c t i v a t e d . To e v a l u a t e t h e p o t e n t i a l i m p a c t on A l a s k a H ighway t r a f f i c v o l u m e s , t h i s h i g h w a y must be a n a l y s e d i n c o n j u n c t i o n w i t h o t h e r c o m p o n e n t s o f t h e m u l t i - m o d a l W.P. & Yukon s e r v i c e s . P r o j e c t i o n s i n t h i s r e g a r d a r e d e t a i l e d i n C h a p t e r 5. 8 p r i o r t o c o m p l e t i o n o f t h i s h i g h w a y , W h i t e h o r s e d e s t i n e d f e r r y u s e r s h a d no c h o i c e b u t t o t r a n s p o r t t h e i r v e h i c l e f r o m Skagway a b o a r d s p e c i a l l y d e s i g n e d r a i l w a y c a r - c a r r i e r s " 9 WHITE PASS & YUKON INQUIRY - CTC ( 1 9 8 0 ) 51 t r a f f i c , t h i s highway has c o n s i d e r a b l y eroded W.P.&Y. Cor p o r a t i o n ' s passenger r a i l t r a f f i c revenue. Not only have 28,000 t o u r i s t s per year been d i v e r t e d from r a i l to newly developed tour bus s e r v i c e s , but revenue a s s o c i a t e d with the r a i l w a y ' s v e h i c l e t r a n s p o r t a t i o n s e r v i c e have a l s o been d i m i n i s h e d " 8 . There has r e c e n t l y been a great deal of lo b b y i n g , p r i m a r i l y by Cyprus A n v i l C o r p o r a t i o n , f o r the r e c o n s t r u c t i o n and upgrading of the Carcross-Skagway highway as a year round t r u c k i n g route. To do so would r e q u i r e $30,000,000 and a minimum c o n s t r u c t i o n p e r i o d of 2 y e a r s " 9 . Once opened to year round t r a f f i c , maintenance and snow removal c o s t s (the area r e c e i v e s 500 inches of snow an n u a l l y ) would be s u b s t a n t i a l . I t i s a l s o g e n e r a l l y agreed that the highway, once upgraded, would d i v e r t s u f f i c i e n t g e n e r a l f r e i g h t volume away from the W.P.& Y. Railway that r a i l s e r v i c e would never be r e a c t i v a t e d . To evaluate the p o t e n t i a l impact on Alask a Highway t r a f f i c volumes, t h i s highway must be analysed i n c o n j u n c t i o n with other components of the multi-modal W.P. & Yukon s e r v i c e s . P r o j e c t i o n s i n t h i s regard are d e t a i l e d i n Chapter 5. 8 p r i o r to completion of t h i s highway, Whitehorse d e s t i n e d f e r r y users had no ch o i c e but to t r a n s p o r t t h e i r v e h i c l e from Skagway aboard s p e c i a l l y designed r a i l w a y c a r - c a r r i e r s " 9 WHITE PASS 8. YUKON INQUIRY - CTC (1980) 52 2.7.2.2 HIGHWAY 37 (STEWART-CASSIAR): Hig h w a y 37 i s , w i t h o u t a d o u b t , t h e n o r t h w e s t ' s s i n g l e most i m p o r t a n t s u r f a c e t r a n s p o r t a t i o n a l t e r n a t i v e i n t e r m s o f i t s p o t e n t i a l t o d i v e r t t r a f f i c away f r o m t h e A l a s k a H i g h w a y . The o p e n i n g o f t h i s r o u t e t o t h r o u g h t r a f f i c b e t w e e n H i g h w a y 16 a n d t h e A l a s k a H i g h w a y ( n e a r Watson L a k e ) was a c h i e v e d i n 1976. S i n c e i t s c o n c e p t i o n i n t h e l a t e 1950's t o t h e end o f 1979, more t h a n $ 100,000,000 h a s been i n v e s t e d i n t h i s 734 k i l o m e t e r c o r r i d o r 5 0 . Of t h a t t o t a l , e q u a l c o n t r i b u t i o n s t o t a l l i n g $15,000,000 were p r o v i d e d by t h e f e d e r a l M i n i s t r y o f T r a n s p o r t and t h e D e p a r t m e n t o f R e g i o n a l E c o n o m i c E x p a n s i o n u n d e r t h e f e d e r a l l y s p o n s o r e d W e s t e r n N o r t h l a n d s A g r e e m e n t . A p p r o x i m a t e l y 370 k i l o m e t e r s a r e c u r r e n t l y u n p a v e d b u t o f f a i r l y h i g h i n d u s t r i a l g r a v e l r o a d s t a n d a r d 5 1 . T h i s h i g h w a y p r o v i d e s a s a v i n g s o f 212 k i l o m e t e r s f o r Yukon o r A l a s k a d e s t i n e d t r a f f i c w h i c h o r i g i n a t e s s o u t h o f P r i n c e G e o r g e , B r i t i s h C o l u m b i a . F o r t r a f f i c o r i g i n a t i n g i n t h e e a s t , t h i s c o r r i d o r i s s l i g h t l y l o n g e r r e l a t i v e t o t h e more e s t a b l i s h e d A l a s k a H i g h w a y r o u t e . The m a i n c o m m e r c i a l u s e r o f H i g h w a y 37 i s c u r r e n t l y 5 0 HIGHWAY 37 CORRIDOR REPORT - 1980 - B.C. M i n i s t r y o f L a n d s , P a r k s , a n d H o u s i n g 5 1 R . J . B a i n e s - S e n i o r I n f o r m a t i o n O f f i c e r , M i n i s t r y o f T r a n s p o r t a t i o n a n d H i g h w a y s , B r i t i s h C o l u m b i a 53 A r r o w T r a n s p o r a t i o n S y s t e m s w h i c h o f f e r s b o t h m u l t i m o d a l and t r u c k - o n l y s e r v i c e s t o C a s s i a r , B r i t i s h C o l u m b i a , and Yukon c o m m u n i t i e s f r o m V a n c o u v e r . The m u l t i m o d a l s e r v i c e , i n v o l v e s b a r g i n g t o S t e w a r t , a n d t h e n t r a n s f e r r i n g g o o d s t o d o u b l e t r a i l e r u n i t s w h i c h c a r r y them t o f i n a l d e s t i n a t i o n 5 2 . T h i s s y s t e m t r a n s p o r t s 6,000,000 g a l l o n s o f g a s o l i n e , 8000 t o n s o f g e n e r a l f r e i g h t , a n d 120,000 t o n s o f C a s s i a r A s b e s t o s o r e on an a n n u a l b a s i s . The i n i t i a t i o n o f t h i s s e r v i c e i n 1978 was p r o m p t e d by t h e w i n n i n g o f a m a j o r C a s s i a r A s b e s t o s c o n t r a c t f r o m W h i t e P a s s . A r r o w ' s s u c c e s s f u l b i d was e i g h t t o t e n d o l l a r s l e s s p e r t o n f o r t h e a s b e s t o s o r e movement a n d 10 t o 11 c e n t s p e r g a l l o n l e s s f o r f u e l 5 3 . The n e t r e s u l t was a s u b s t a n t i a l d i v e r s i o n o f t r u c k t r a f f i c away f r o m t h e W h i t e h o r s e W a t s o n L a k e s e c t i o n o f t h e A l a s k a H i g h w a y t o H i g h w a y 3 7 5 a . A r r o w d i d e x p e r i e n c e b o t h e x p e c t e d and u n f o r s e e n d i f f i c u l t i e s d u r i n g t h e f i r s t y e a r o f t h i s m u l t i - m o d a l s e r v i c e . S e v e r e i c i n g l e d t o t h e o v e r t u r n i n g o f b e t w e e n 8 and 17 t r u c k s . D u s t p r o b l e m s i n summer months were s e v e r e 5 5 . W e i g h t r e s t r i c t i o n s were 2 e a c h " B - t r a i n " a c c o m o d a t e s 1 ISO c o n t a i n e r a n d one f u e l t a n k 3 WHITE PASS INQUIRY - CTC ( p . 98) 4 W h i t e P a s s h a d p r e v i o u s l y t r u c k e d t h e a s b e s t o s o r e f r o m C a s s i a r t o W h i t e h o r s e v i a t h e A l a s k a H i g h w a y and t h e n t o V a n c o u v e r by r a i l a n d b a r g e v i a Skagway 5 t h e p r o v i n c e commenced an $800,000 d u s t a b a t e m e n t p r o g r a m i n t h e summer o f 1980 t o a l l e v i a t e t h i s p r o b l e m 54 e n f o r c e d f o r a p e r i o d o f 8 weeks i n 1979 c o m p a r e d t o 3-4 weeks i n t h e c a s e o f t h e A l a s k a H i g h w a y . C o m b i n e d w i t h l a b o u r r e l a t i o n s d i f f i c u l t i e s , t h e s e p r o b l e m s l e d t o a c o n s i d e r a b l e e s c a l a t i o n i n c o s t s a n d t h e r e -d i v e r s i o n o f some a s b e s t o s t r a f f i c b a c k t o W h i t e P a s s & Yukon s e r v i c e s 5 6 . Many o f t h e p r o b l e m s a s s o c i a t e d w i t h H i g h w a y 37's l o w p h y s i c a l s t a n d a r d s h a v e been r e d u c e d i n s e v e r i t y due t o c o n s i d e r a b l e u p g r a d i n g o f t h i s r o u t e i n r e c e n t y e a r s by t h e B r i t i s h C o l u m b i a H i g h w a y s M i n i s t r y . C a p i t a l c o n t r a c t s t o t a l l i n g $ 1 1 ,440,000 were a n n o u n c e d i n t h e f i r s t month o f 1980 a l o n e 5 7 . I n a d d i t i o n t o i t s m u l t i - m o d a l s y s t e m , A r r o w s e n d s 50-60 t r u c k s p e r month (25 t o n s p e r u n i t ) d i r e c t l y t o t h e Yukon f r o m V a n c o u v e r v i a High w a y 37. A n o t h e r common c a r r i e r , Y u kon F r e i g h t L i n e s , s e n d s r o u g h l y o n e - h a l f o f i t s a n n u a l 4000 t o n s o f Yukon d e s t i n e d g e n e r a l f r e i g h t by way o f High w a y 37. L y n d e n T r a n s p o r t now s e n d s a l l o f i t s A l a s k a d e s t i n e d t r a f f i c o v e r H i g h w a y 37 w h i c h i t c l a i m s t o be " t h e b e t t e r o f t h e two h i g h w a y a l t e r n a t i v e s " . I n t o t a l , c o m m e r c i a l t r u c k t r a f f i c t o t a l l e d an e s t i m a t e d 160 t r i p s / w e e k a l o n g t h i s r o u t e i n 1980, o f w h i c h 90 were a s b e s t o s r e l a t e d . D i s c u s s i o n s w i t h v a r i o u s c a r r i e r s s u g g e s t 5 6 w i t h i t s u n f o r s e e n o p e r a t i o n a l p r o b l e m s , A r r o w d i d n o t h a v e t h e c a p a c i t y t o h a n d l e a l l C a s s i a r a s b e s t o s a n d s u b c o n t r a c t e d a p o r t i o n o f t h i s t r a f f i c b a c k t o W h i t e P a s s a nd Yukon C o r p o r a t i o n 5 7 b a s e d on M i n i s t r y p r e s s r e l e a s e s p r o v i d e d by t h e C h i e f i n f o r m a t i o n o f f i c e r 55 t h a t a m a j o r d e t e r r e n t t o u s i n g H i g h w a y 37 more e x t e n s i v e l y i s t h a t i t i s o u t o f t o u c h w i t h e s t a b l i s h e d t e r m i n a l s and r e p a i r f a c i l i t i e s . T h e r e h a s been some d i v e r s i o n o f t o u r i s t t r a f f i c f r o m t h e A l a s k a H i g h w a y t o Highway 37 s i n c e 1976. I t i s b e l i e v e d t h e r e e x i s t s t h e p o t e n t i a l f o r s i g n i f i c a n t l y more d i v e r s i o n o f t h i s t y p e i n f u t u r e y e a r s . T r a f f i c c o u n t s a r e t a k e n a l o n g t h i s c o r r i d o r b u t t h e y a r e u n f o r t u n a t e l y few i n number, i n f r e q u e n t , and s h o r t i n d u r a t i o n , t h u s c a u t i o n must be u s e d when i n t e r p r e t i n g t h e i r r e s u l t s . K e e p i n g t h e s e w e a k n e s s e s i n m i n d , t h e c o u n t s s u g g e s t t h a t a v e r a g e d a i l y t r a f f i c a l o n g t h i s r o u t e j u s t n o r t h of C a s s i a r i n c r e a s e d f r o m 190 t o 240 b e t w e e n t h e y e a r s 1977 and 1 9 7 9 5 8 . G a s o l i n e s o l d a l o n g t h i s r o u t e i n c r e a s e d 57% b e t ween t h e s e two y e a r s . I n c o n t r a s t , a v e r a g e d a i l y t r a f f i c v o l u m e s a t m i l e 685 o f t h e A l a s k a H i g h w a y f e l l f r o m 612 t o 532 d u r i n g t h e same p e r i o d . T h e s e f a c t s w o u l d a p p e a r t o s u p p o r t t h e h y p o t h e s i s t h a t d i v e r s i o n i s i n p r o g r e s s . A 1979 L i a r d a r e a v i s i t o r s u r v e y c o n d u c t e d by B.C.Hydro i n d i c a t e s t h a t o f 90,000 A l a s k a H i g h w a y v i s i t o r s , 44,000 p l a n n e d t o r e t u r n v i a t h e same r o u t e . S i n c e c i r c l e r o u t e s a r e g e n e r a l l y p r e f e r r e d t o t r a v e l i n g b o t h ways v i a t h e same c o r r i d o r , t h e s e numbers s u g g e s t t h a t s u b s t a n t i a l d i v e r s i o n p o t e n t i a l r e m a i n s . I n f a c t i t may be t h a t 37 CORRIDOR REPORT - 1980 ( p . 31) 56 some t o u r i s t s now using the Alaska' Highway/Alaska Marine Highway c i r c l e route would p r e f e r the Highway 37/Alaska Marine Highway a l t e r n a t i v e . Not only i s Highway 37 a s h o r t e r route f o r roughly one-half of e x i s t i n g Alaska Highway t o u r i s t s , but i t i s more sc e n i c as w e l l . The Highway 37 C o r r i d o r Report s t a t e s 5 9 : " t o u r i s t expect to f i n d scenery, w i l d l i f e , and good f i s h i n g i n the North. While both routes can f u l f i l l these e x p e c t a t i o n s , people who have t r a v e l l e d both g e n e r a l l y agree that the scenery i s f a r s u p e r i o r along Highway 37" In a d d i t i o n to i t s poor p h y s i c a l standards, two f a c t o r s have thus f a r l i m i t e d the extent to which t o u r i s t d i v e r s i o n to Highway 37 has ocurred. These ar e : - Highway 37 i s not w e l l known as an a l t e r n a t i v e route to the North. Promoters of highway based tourism to the Yukon and beyond tend to s t r e s s Alaska Highway tours and may f a i l to mention Highway 37 at a l l 6 0 . - Highway 37 i s f a i r l y barren with 5 9 I b i d . P.20 57 r e s p e c t t o f a c i l i t i e s f o r t o u r i s t s a n d o t h e r t r a v e l l e r s . T h e r e w e r e , i n 1980, f o u r g a p s o f b e t w e e n 120 a n d 240 k i l o m e t e r s i n w h i c h no f a c i l i t i e s e x i s t o f any k i n d . E x c l u d i n g S t e w a r t a n d K i t w a n g a , t h e r e w e r e , i n 1980, o n l y 54 m o t e l u n i t s a l o n g t h i s h i g h w a y . I n many c a s e s , t r a v e l l e r s a r e r e q u i r e d t o s p e n d n i g h t s a l o n g t h e s i d e o f t h e r o a d b e c a u s e o f t h e l a c k o f a d e q u a t e c a m p i n g f a c i l i t i e s . T h e s e two o b s t a c l e s t o t r a f f i c d i v e r s i o n a r e e x p e c t e d t o e r o d e w i t h t i m e . The B r i t i s h C o l u m b i a M i n i s t r y o f L a n d s , P a r k s , a n d H o u s i n g i s i n t h e p r o c e s s o f e s t a b l i s h i n g 2 new c a m p g r o u n d s a l o n g t h i s r o u t e o f 50 - 60 u n i t s e a c h . The c u r r e n t s t r a t e g y i s t o g r a d u a l l y d e v e l o p a d d i t i o n a l p a r k s b e t ween t h e s e a s demand becomes a p p a r e n t . However t h e p r o v i n c e ' s i n t e r e s t i n H i g h w a y 37, and t h e r e f o r e t h e t i m i n g a n d e x t e n t o f r e c o n s t r u c t i o n a l o n g t h i s c o r r i d o r , i s somewhat o f a m y s t e r y . C o n v e r s a t i o n s w i t h t h e H i g h w a y s P l a n n i n g B r a n c h o f t h e 6 0 f o r e x a m p l e , t h e t o u r i s t i n f o r m a t i o n o f f i c e i n P r i n c e G e o r g e h a s a t r a d i t i o n a l a f f i l i a t i o n w i t h t o u r s a l o n g t h e A l a s k a H i g h w a y a n d c o n s e q u e n t l y t e n d s t o c h a n n e l t r a f f i c i n t h a t d i r e c t i o n - HIGHWAY 37 CORRIDOR REPORT - 1980 ( p . 1 7 ) 58 M i n i s t r y o f T r a n s p o r t a t i o n , C o m m u n i c a t i o n s a n d H i g h w a y s i n d i c a t e t h a t : - Highway 37 i s a low p r i o r i t y h i g h w a y a n d a l l o c a t e d l i t t l e a t t e n t i o n f r o m a p l a n n i n g p e r s p e c t i v e - t h e o b j e c t i v e i s t o k e e p H i g h w a y 37 open and t o s a t i s f y t h o s e i n t h e v i c i n i t y o f t h e h i g h w a y r a t h e r t h a n t o p r o m o t e i t a s a t h r o u g h r o u t e d e s i g n e d t o c o mpete w i t h t h e A l a s k a H i g h w a y a s a c o r r i d o r t o t h e n o r t h - t h e r e e x i s t s no f i r m p o l i c y t o u p g r a d e a n d p a v e t h e e n t i r e r o u t e However t h e e x t e n t o f p r o v i n c i a l l y f u n d e d r e c o n s t r u c t i o n a l o n g t h e r o u t e t e n d s t o c o n f l i c t w i t h t h e s t a t e d p o l i c y o r "non p o l i c y " . W i t h t h e t e r m i n a t i o n o f f e d e r a l l y s u p p o r t e d r e c o n s t r u c t i o n i n 1979, t h e p r o v i n c e c o n t i n u e d t o i n v e s t s u b s t a n t i a l f u n d s i n t o c a p i t a l p r o g r a m s a l o n g t h e r o u t e . O n l y 124 k i l o m e t e r s o f t h i s c o r r i d o r were p a v e d i n 1979 c o m p a r e d t o 350 k i l o m e t e r s t o d a y . E x c e r p t s f r o m 1980 M i n i s t r y o f T r a n s p o r t a t i o n , C o m m u n i c a t i o n s , and H i g h w a y s p r e s s r e l e a s e s s u g g e s t t h e h i g h w a y i_s o f 59 r e l a t i v e l y h i g h p r i o r i t y a n d i n c l u d e : - "Highway 37 i s t h e w e s t e r n m o s t r o u t e t o t h e n o r t h i n B r i t i s h C o l u m b i a and i s d e v e l o p i n g i n t o a m a j o r r e s o u r c e / t o u r i s t h i g h w a y " - 1/22/80 - "The S t e w a r t - C a s s i a r r o u t e i s b e i n g d e v e l o p e d by t h e m i n i s t r y f o r a v a r i e t y o f r e a s o n s . T h i s h i g h w a y , t h e o n l y n o r t h - s o u t h r o u t e w e s t o f H i g h w a y 97 i s o p e n i n g up n o r t h e a s t e r n B r i t i s h C o l u m b i a t o t o u r i s m , a s a c c e s s t o n a t u r a l r e s o u r c e s , and a s a l i n k w i t h c e n t r a l a n d s o u t h e r n a r e a s o f t h e p r o v i n c e v i a P r i n c e R u p e r t f e r r y s e r v i c e a n d f o r t h c o m i n g f e r r y s e r v i c e t o t h e Queen C h a r l o t t e s " - s t a t e m e n t f r o m t h e M i n i s t e r I t may w e l l be t h a t t h e p r o v i n c e i s d o w n - p l a y i n g i t s i n t e r e s t i n r e c o n s t r u c t i n g H i g h w a y 37 f o r f e a r t h a t t h e f e d e r a l g o v e r n m e n t m a y ' s h i f t p r i o r i t y away f r o m t h e A l a s k a H i g h w a y . The p r o v i n c i a l g o v e r n m e n t h a s , on s e v e r a l o c c a s i o n s i n t h e p a s t , made c l e a r i t s d e s i r e t o s e e t h e A l a s k a H i g h w a y u p g r a d e d a n d p a v e d by t h e f e d e r a l g o v e r n m e n t . T h i s may be a c l a s s i c e x a m p l e o f d i v e r g i n g f e d e r a l a n d p r o v i n c i a l o b j e c t i v e s a n d how an u n s y s t e m a t i c a p p r o a c h t o h i g h w a y p l a n n i n g c a n be t h e en d r e s u l t , a s d i s c u s s e d i n s e c t i o n 2.1. P r o j e c t i o n s a s t o t h e h i g h w a y ' s f u t u r e s t a t u s , and d i s c u s s i o n s a s t o how A l a s k a H i g h w a y v o l u m e s may be a f f e c t e d , a r e p r o v i d e d i n s e c t i o n 5.3 o f c h a p t e r 5. 60 2.7.2.3 C a n o l Road: Y u k o n ' s H i g h w a y #6 c o n s i s t s o f t h e 222 k i l o m e t e r S o u t h C a n o l R o a d , l i n k i n g J o h n s o n ' s C r o s s i n g a nd R o s s R i v e r , a s w e l l as t h e N o r t h C a n o l Road w h i c h e x t e n d s 208 k i l o m e t e r s f r o m R o s s R i v e r t o t h e more e a s t e r l y M a c m i l l a n P a s s r e g i o n . C u r r e n t l y m a i n t a i n e d f o r summer use o n l y , t h i s r o a d h a s r e c e n t l y a t t r a c t e d i n t e r e s t a s a p o s s i b l e c o r r i d o r by w h i c h an e x p a n d e d l e a d / z i n c i n d u s t r y w i l l t r a n s p o r t o r e t o t i d e w a t e r a t S k a g w a y 6 1 . T h i s a l t e r n a t i v e r e p r e s e n t s a r e d u c t i o n o f 63 k i l o m e t e r s b e t w e e n R o s s R i v e r a n d r a i l h e a d a t U t a h ( n e a r W h i t e h o r s e ) c o m p a r e d t o t h e e x i s t i n g A l a s k a / C a m p b e l l / K l o n d i k e H i g h w a y r o u t e . The r e d u c t i o n i s s i g n i f i c a n t s i n c e f u t u r e l e a d / z i n c d e v e l o p m e n t s a r e e x p e c t e d t o o c c u r ' n o r t h a n d e a s t o f R o s s R i v e r . I n t h e e v e n t t h a t t h e C a r c r o s s H i g h w a y i s a l s o u p g r a d e d t o h a u l a g e s t a n d a r d s , t h e C a n o l a l t e r n a t i v e w o u l d o f f e r a more s u b s t a n t i a l r e d u c t i o n i n r e q u i r e d t r u c k i n g d i s t a n c e t o t a l l i n g 125 k i l o m e t e r s . A r e - r o u t i n g o f l e a d / z i n c o r e t r a f f i c v i a a r e c o n s t r u c t e d C a n o l Road w o u l d i n c r e a s e t r a f f i c f l o w s b e t w e e n k i l o m e t e r 1344 a n d 1395 on t h e A l a s k a H i g h w a y s u b s t a n t i a l l y . T h i s s c e n a r i o i s d i s c u s s e d i n d e t a i l i n s e c t i o n 5.3. 6 1 G o v e r n m e n t o f Yukon - POLICY DIRECTIVE - 01/04/83 and YUKON MINING INFRASTRUCTURE - 01/13/81 61 2.7.2.4 L i a r d H i g h w a y : T h i s 409 k i l o m e t e r h i g h w a y w i l l l i n k F o r t N e l s o n a n d t h e M a c k e n z i e H i g h w a y s o u t h o f F o r t S i m p s o n , N.W.T. J o i n t f u n d i n g t o t a l l i n g $ 40,000,000 i s b e i n g p r o v i d e d by B r i t i s h C o l u m b i a a n d t h e f e d e r a l M i n i s t r y o f I n d i a n a n d N o r t h e r n A f f a i r s 6 2 . A l t h o u g h l i n k e d w i t h t h e A l a s k a H i g h w a y , i t i s u n l i k e l y t h a t t h i s r o u t e , when c o m p l e t e d , w i l l c o n t r i b u t e s i g n i f i c a n t l y t o A l a s k a H i g w h a y v o l u m e s . T h i s h y p o t h e s i s i s j u s t i f i e d a s f o l l o w s : - N e w l y g e n e r a t e d o r d i v e r t e d t r a f f i c m o v i n g t o t h e M a c k e n z i e V a l l e y o r D e l t a r e g i o n s f r o m s o u t h e r n o r i g i n s v i a t h e L i a r d H i g h w a y w i l l be c a r r i e d f i r s t by B . C . R a i l t o F o r t N e l s o n r a t h e r t h a n by t h e A l a s k a H i g h w a y . The new P r a i r i e C r e e k m i n e , l o c a t e d j u s t n o r t h o f N a h a n n i N a t i o n a l P a r k , i s t o u s e B . C . R a i l s e r v i c e s e x c l u s i v e l y f o r b o t h t h e o u t b o u n d movement o f o r e and b a c k h a u l i n g o f s u p p l i e s . - W h i l e t h e h i g h w a y w i l l p r o v i d e one l i n k o f an a l t e r n a t i v e m u l t i - m o d a l s u p p l y r o u t e t o t h e M a c k e n z i e V a l l e y a n d D e l t a , i t may be u n a b l e t o c o m p e t e w i t h t h e e s t a b l i s h e d t r u c k / r a i l / b a r g e n e t w o r k now s e r v i n g t h o s e a r e a s . - I t h a s been s t r e s s e d t h a t , b e c a u s e e a r l i e r t h a w i n g a n d d e l a y e d i c e f o r m a t i o n a l o n g t h e M a c k e n z i e R i v e r n o r t h o f F o r t S i m p s o n , t h e o p e n i n g o f t h e L i a r d c o r r i d o r w i l l e f f e c t i v e l y e x t e n d t h e b a r g i n g s e a s o n by a t o t a l o f f o u r weeks r e l a t i v e t o t h a t o f t h e e x i s t i n g Hay R i v e r b a s e d o p e r a t i o n s . However t h e p o t e n t i a l f o r an e x t e n d e d b a r g i n g s e a s o n a l r e a d y e x i s t s f o r t h o s e who w i s h t o e x p l o i t i t by u s i n g t h e 6 2 F e d e r a l T r e a s u r y B o a r d s u b m i s s i o n - 5/26/77 62 M a c k e n z i e H i g h w a y a s a t r u c k r o u t e t o F o r t S i m p s o n , and b a r g e s e v i c e s f r o m t h e r e t o f i n a l d e s t i n a t i o n . 2.7.2.5 D e m p s t e r H i g h w a y : T h i s 740 k i l o m e t e r c o r r i d o r l i n k s t h e K l o n d i k e H i g h w a y j u s t e a s t o f Dawson C i t y w i t h A r c t i c Red R i v e r n e a r t h e M a c k e n z i e D e l t a . T o g e t h e r w i t h t h e K l o n d i k e and A l a s k a H i g h w a y s , t h e D e m p s t e r r e p r e s e n t s t h e o n l y l a n d a c c e s s t o t h e M a c k e n z i e D e l t a f r o m s o u t h e r n o r i g i n s . C o n s t r u c t i o n was c o m p l e t e d i n 1979 a n d , w h i l e o p e n e d t o y e a r r o u n d t r a f f i c , e n g i n e e r i n g s t a n d a r d s a r e v e r y low a n d few f a c i l i t i e s e x i s t a l o n g t h e somewhat i s o l a t e d r o u t e . R i v e r f e r r i e s a n d i c e b r i d g e s a r e c u r r e n t l y u s e d t o s p a n n o r t h e r n w a t e r w a y s c r o s s e d by t h i s h i g h w a y . B e t w e e n O c t o b e r a n d A p r i l , when i c e f o r m a t i o n a l o n g t h e M a c k e n z i e R i v e r p r e c l u d e s t h e u s e o f r i v e r b a r g e s , t h e D e m p s t e r p r o v i d e s t h e o n l y n o n - a i r common c a r r i e r p a s s a g e t o M a c k e n z i e D e l t a a n d t h e B e a u f o r t S e a . A c o m p a r i s o n o f r e l a t i v e t a r i f f s a n d t r a n s i t t i m e s v i a t h e t h r e e a v a i l a b l e modes a r e l i s t e d i n TABLE 2 - 7 6 3 . Yukon F r e i g h t L i n e s a n d P o i n t s N o r t h T r a n s p o r t a t i o n a r e t h e o n l y known s c h e d u l e d c a r r i e r s w h i c h o p e r a t e 3 1980 t a r i f f s f o r g e n e r a l f r e i g h t movements b e t w e e n Edmonton an d I n u v i k , N.W.T. - p r o v i d e d by Yukon F r e i g h t L i n e s and N.T.C.L. 63 *************** TABLE 2 — 7 ***************** 1980 GENERAL FREIGHT T A R I F F S - EDMONTON TO INUVIK MODE CENTS/LB TRANSIT TIME **** ******** ************ H i g h w a y ( v i a D e m p s t e r ) .. 23.0 3-9 d a y s R a i l / B a r g e 16.6 14 d a y s A i r 33.0 1 day ******************************************* a l o n g t h i s r o u t e on a r e g u l a r b a s i s . T o g e t h e r , t h e y s e n d 9 t r u c k s / w e e k up t h e h i g h w a y . T h e s e c a r r i e r s i n d i c a t e t h a t c o n s i d e r a b l y more f r e i g h t moves by p r i v a t e a n d c o n t r a c t c a r r i e r s . C o m m o d i t i e s c a r r i e d t y p i c a l l y i n c l u d e meat p r o d u c t s , o i l w e l l s u p p l i e s , a n d v a r i e s o t h e r f r e i g h t c a t e g o r i e s w h i c h a r e v a l u e d s u f f i c i e n t l y h i g h t o e x c l u d e b a r g e s e r v i c e s a s an e c o n o m i c a l t r a n s p o r t a l t e r n a t i v e b u t b e l o w a l e v e l w h i c h w o u l d j u s t i f y s h i p p i n g v i a t h e a i r mode. An AADT c o u n t o f 20 h a s been c a l c u l a t e d by PWC t o e x i s t a l o n g t h i s h i g h w a y j u s t n o r t h o f E a g l e P l a i n s , b u t s h o u l d n o t be assumed an a c c u r a t e r e f l e c t i o n o f t r a f f i c f l o w s a l o n g t h e e n t i r e r o u t e . P r o j e c t i o n s w i t h r e s p e c t t o f u t u r e v o l u m e s moved v i a t h i s c o r r i d o r a n d t h e a s s o c i a t e d i m p a c t on A l a s k a H i g h w a y t r a f f i c c o u n t s a r e p r o v i d e d i n s e c t i o n 5.3. 64 2.7.2.6 M a c k e n z i e H i g h w a y : C o n c e i v e d a s p a r t of t h e f e d e r a l Roads t o R e s o u r c e s p r o g r a m , t h i s h i g h w a y was d e s i g n e d t o p r o v i d e y e a r r o u n d s u r f a c e a c c e s s t o t h e M a c k e n z i e D e l t a a n d t o f a c i l i t a t e t h e c o n s t r u c t i o n of t h e M a c k e n z i e V a l l e y P i p e l i n e . However now t h a t t h e D e m p s t e r H i g h w a y i s a v a i l a b l e a s a y e a r r o u n d a c c e s s r o u t e t o t h e D e l t a a n d c o n s t r u c t i o n o f t h e M a c k e n z i e V a l l e y P i p e l i n e w i t h i n t h e f o r s e e a b l e f u t u r e a p p e a r s u n l i k e l y , t h e s t r a t e g i c v a l u e a n d p r i o r i t y o f t h e M a c k e n z i e H i g h w a y have been r e d u c e d c o n s i d e r a b l y . C u r r e n t l y , t h e h i g h w a y e x t e n d s o n l y t o a p o i n t 16 k i l o m e t e r s s o u t h o f W r i g l e y , NWT, a l t h o u g h p l a n n i n g a n d d e s i g n work f o r t h e e n t i r e r o u t e h a v e been c o m p l e t e d . • 2.7.3. THE AIR MODE: S t a t i s t i c s C anada d a t a i n d i c a t e s t h a t r o u g h l y 1000 t o n n e s o f f r e i g h t a r e a i r l i f t e d t o t h e Yukon on an a n n u a l b a s i s . S o u t h b o u n d f r e i g h t t r a f f i c i s t y p i c a l l y o n e - h a l f t h a t v o l u m e . I t i s t h e r e f o r e u n l i k e l y t h a t d i v e r s i o n o f f r e i g h t t r a f f i c f r o m a i r s e r v i c e s t o t h e A l a s k a H i g h w a y o r v i c a - v e r s a i n f u t u r e y e a r s w i l l be o f a m a g n i t u d e s u f f i c i e n t t o w a r r e n t f u r t h e r c o n s i d e r a t i o n . However t h e r e h a s i n t h e p a s t b een c o n s i d e r a b l e d i v e r s i o n t o a i r s e r v i c e s f r o m t h e A l a s k a H i g h w a y a s a l i n k t o t h e n o r t h f o r p a s s e n g e r t r a v e l . A d v a n c e s i n a i r c r a f t t e c h n o l o g y and o p e r a t i o n a l 65 e f f i c i e n c y h a v e t o g e t h e r l o w e r e d a i r f a r e s c o n s i d e r a b l y d u r i n g t h e p a s t few d e c a d e s . A t t h e same t i m e , c o m f o r t l e v e l s a n d t r a n s i t t i m e s have become more a t t r a c t i v e t o e x i s t i n g a n d p o t e n t i a l u s e r s o f a i r s e r v i c e s . F a r e c o m p a r i s o n s f o r t h e y e a r s 1964 and 1982 a r e l i s t e d i n TABLE 2 - 8 6 " . The S t a n f o r d R e p o r t e s t i m a t e d c o s t s o f ******************* TABLE 2~8 *********************** RELATIVE PASSENGER AIR TARIFFS ORIGIN/DESTINATION FARES (ONE-WAY) ****************** *************** 1964 1 9 6 4 ( 1 9 8 2 $ ) 1982 **** *********** **** S e a t t l e / A n c h o r a g e 146.35 470.00 225.00 V a n c o u v e r / A n c h o r a g e 130.00 418.00 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * t r a v e l l i n g b e t w e e n S e a t t l e a n d A l a s k a by a u t o m o b i l e t o be $180.00 i n c l u s i v e o f l o d g i n g a n d m e a l s i n 1964, o r r o u g h l y 20 % more t h a n t h e a i r a l t e r n a t i v e . T o d a y , t h e c o s t o f m a k i n g t h e same j o u r n e y by a u t o m o b i l e w o u l d a p p r o x i m a t e t h r e e t i m e s t h e c u r r e n t p o s t e d a i r f a r e . W h i l e t o u r i s m t o a n d f r o m A l a s k a has been g r o w i n g a t t h e r a t e o f 10% p e r a n n u m 6 5 , and a i r t r a v e l t o t h e 6 4 STANFORD REPORT - 1966 ( p . V-7) a n d ALASKA TRAVEL AGENT MANUAL ( s p e c i a l l o w e r f a r e s a r e a v a i l a b l e i n some c a s e s ) 6 5 ALASKA TRAVEL AGENT MANUAL ( p . 5) 66 Yukon i n c e a s e d r o u g h l y 50% b e t w e e n t h e y e a r s 1975 a n d 1 9 8 0 6 6 , h i g h w a y b o r d e r c r o s s i n g s i n t o t h e Yukon h a v e been r e l a t i v e l y s t a b l e i n r e c e n t y e a r s . I n f a c t , T o u r i s m Yukon d a t a i n d i c a t e s t h a t h i g h w a y b o r d e r c r o s s i n g s i n t o t h e Yukon a t Watson L a k e d e c r e a s e d f r o m 87,000 p e r s o n s i n 1975 t o 83,000 i n 1980. D i v e r s i o n f r o m t h e A l a s k a H i g h w a y t o a i r s e r v i c e s h a s been s u b s t a n t i a l i n t h e r e c e n t p a s t . Yukon T o u r i s m r e p r e s e n t a t i v e s p r o j e c t t h a t t h e g r o w t h i n a i r t r a v e l t o t h e t e r r i t o r y w i l l c o n t i n u e . A i r t r a v e l b etween c o m m u n i t i e s a l o n g t h e A l a s k a H i g h w a y i s r e l a t i v e l y l i g h t . A p p r o x i m a t e a n n u a l f l o w s a r e a s l i s t e d i n TABLE 2 - 9 6 7 . F u t u r e d i v e r s i o n ************** TABLE 2 _ 9 ************* A I R PASSENGER VOLUME - 1981 COMMUNITY LINK NUMBER OF PERSONS ************** ***************** FT. NELSON - WATSON LAKE 290 FT. NELSON - FT. ST. JOHN 3,750 WATSON LAKE - WHITEHORSE 2,650 ************************************** p o t e n t i a l w i t h r e s p e c t t o t h e a i r a l t e r n a t i v e i s d i s c u s s e d f u r t h e r i n s e c t i o n s 5.1 a n d 5.2 o f c h a p t e r 5. 6 6 f r o m 61,500 t o 91,000 p e r annum - Yukon T o u r i s m d a t a 67 • 2.7.4 R A I L : The B r i t i s h C o l u m b i a R a i l w a y F o r t N e l s o n E x t e n s i o n , a n d t h e W h i t e P a s s a n d Yukon R a i l w a y c o mpete d i r e c t l y w i t h A l a s k a H i g h w a y c o m m e r c i a l t r u c k i n g s e r v i c e s . O t h e r e x i s t i n g a n d p r o p o s e d r a i l d e v e l o p m e n t s e x i s t , s u c h a s t h e N o r t h e r n A l b e r t a R a i l w a y a n d N o r t h e a s t C o a l r e l a t e d r a i l d e v e l o p m e n t s , b u t a r e o f l i t t l e c o n s e q u e n c e w i t h r e s p e c t t o p r e s e n t a n d p r o j e c t e d t r a f f i c v o l u m e s a l o n g t h e A l a s k a H i g h w a y . 2.7.4.1 W h i t e P a s s a n d Yukon R a i l w a y : T h i s n a r r o w guage r a i l w a y l i n k i n g W h i t e h o r s e w i t h Skagway, A l a s k a , h a s been d i s c u s s e d p r e v i o u s l y i n c o n j u n c t i o n w i t h W h i t e P a s s a n d Yukon m u l t i - m o d a l s e r v i c e s a n d t h e C a r c r o s s - S k a g w a y H i g h w a y . See s e c t i o n s 2.7.1.1 a n d 2.7.2.1 f o r a d e s c r i p t i o n o f t h i s t r a n s p o r t a t i o n a l t e r n a t i v e . 2.7.4.2 B.C.R. F o r t N e l s o n E x t e n s i o n : C o m p l e t e d i n 1971, t h i s B r i t i s h C o l u m b i a R a i l w a y e x t e n s i o n now c a r r i e s v i r t u a l l y a l l b u l k c o m m o d i t i e s a n d r o u g h l y 10,000 t o n s p e r annum o f g e n e r a l f r e i g h t b e t ween F o r t 6 7 S T A T I S T I C S CANADA - M a j o r A i r C a r r i e r D a t a 6 8 D u r i n g 1979, 2000 c a r l o a d s (400,000 t o n s ) o f b u l k c o m m o d i t i e s , p r i m a r i l y f o r e s t p r o d u c t s , a s b e s t o s , a n d s u l f u r , were s h i p p e d s o u t h f r o m F o r t N e l s o n - 45,000 t o n s o f p e t r o l e u m were s h i p p e d n o r t h t o F o r t N e l s o n f r o m t h e P e t r o Canada r e f i n e r y a t T a y l o r 68 N e l s o n a n d F o r t S a i n t J o h n 6 8 . The l i n e was c o n s t r u c t e d p r i m a r i l y t o e n c o u r a g e r e g i o n a l e c o n o m i c d e v e l o p m e n t . H o w e v e r , m i n e r a l a n d p u l p m i l l d e v e l o p m e n t s w h i c h h ad been p r o j e c t e d t o o c c u r upon c o m p l e t i o n o f t h e r a i l e x t e n s i o n have n o t y e t m a t e r i a l i z e d . T h i s l o s s o f p r o j e c t e d t r a f f i c , c o m b i n e d w i t h a h i s t o r y o f s t r u c t u r a l p r o b l e m s a l o n g t h e r o u t e r e s u l t i n g i n 270 d e r a i l m e n t s o v e r a two y e a r p e r i o d , h a s l e d t o t h e a c c r u a l o f s u b s t a n t i a l f i n a n c i a l l o s s e s 6 9 . The BCR R o y a l C o m m i s s i o n c o n c l u d e d t h a t v i r t u a l l y a l l r a i l t r a f f i c a l o n g t h i s r o u t e c o u l d be t r a n s f e r r e d t o h i g h w a y c a r r i e r s u s i n g t h e A l a s k a H i g h w a y a nd t h a t s u c h an a r r a n g e m e n t w o u l d be e c o n o m i c a l l y p r e f e r a b l e t o t h e c o n t i n u e d o p e r a t i o n o f t h e B.C.R. F t . N e l s o n e x t e n s i o n . I f s u c h a d i v e r s i o n o f t r a f f i c w ere t o d e v e l o p , t h e o v e r a l l i m p a c t on A l a s k a H i g h w a y c o m m e r c i a l v o l u m e s b e t w e e n F o r t N e l s o n a n d F o r t S a i n t J o h n w o u l d be s u b s t a n t i a l . A d i s c u s s i o n o f t h e p r o b a b i l i t i e s o f abandonment o f t h i s r a i l e x t e n s i o n i s r e s e r v e d f o r s e c t i o n 5.3. 2.7.4.3 R a i l L i n e C o n n e c t i n g A l a s k a W i t h C o n t i n e n t a l  USA: The e c o n o m i c s o f c o n s t r u c t i n g a r a i l l i n e n o r t h f r o m B r i t i s h C o l u m b i a t o t h e Yukon a n d / o r A l a s k a were 9 t h e l i n e was b u i l t on muskeg w h i c h i s n o t o n l y s t r u c t u r a l l y u n s o u n d b u t i n a d d i t i o n r e q u i r e d h i g h l e v e l s o f r o u t i n e m a i n t e n a n c e t o be i n c u r r e d - THE BCR - A RAILWAY DERAILED a n d REPORT OF THE ROYAL COMMISSION INTO THE BCR ( 1 977") 69 s t u d i e d somewhat s u p e r f i c i a l l y d u r i n g t h e ' e a r l y 1 9 7 0 ' s 7 0 . T h e r e e x i s t s t h e p o t e n t i a l t h a t some t o u r i s m and c o m m e r c i a l t r a f f i c may be d i v e r t e d away f r o m t h e A l a s k a H i g h w a y i f s u c h a r a i l a l t e r n a t i v e were d e v e l o p e d . 2.7.4.4 O t h e r R a i l D e v e l o p m e n t s : C o n s i d e r a b l e f u n d s a r e c u r r e n t l y b e i n g d i r e c t e d t o w a r d s r a i l i n f r a s t r u c t u r e d e v e l o p m e n t a s p a r t o f t h e o v e r a l l N o r t h e a s t C o a l p r o j e c t . The e x p e c t e d i m p a c t on A l a s k a H i g h w a y t r a f f i c v o l u m e s i s n e g l i g i b l e s i n c e t h e g e n e r a l l o c a t i o n o f t h i s r a i l d e v e l o p m e n t i s s o u t h o f t h e s o u t h e r n t e r m i n u s o f t h e A l a s k a H i g h w a y . I n a d d i t i o n , i n t e n s i v e e f f o r t s h a v e r e c e n t l y been d i r e c t e d t o w a r d s d e t e r m i n i n g t h e most e c o n o m i c t r a n s p o r t a t i o n s y s t e m b e t w e e n t i d e w a t e r a n d f u t u r e o r e body d e v e l o p m e n t s l o c a t e d i n t h e F a r o a n d S e l w y n m i n i n g d i s t r i c t s 7 1 . C o n c l u s i o n s a r e t h a t a r a i l c o n n e c t i o n b e t w e e n W h i t e h o r s e a nd P e l l y R i v e r , n e a r F a r o , w o u l d be t h e most a t t r a c t i v e a l t e r n a t i v e g i v e n t h a t p r o j e c t e d o r e v o l u m e s a r e r e a l i z e d . T h i s 7 0 S t u d i e s i n c l u d e d ALASKA-CANADA TRANS-CONTINENTAL R A I L  CONNECTION TO A CONTIGUOUS UNITED STATES - D e p a r t m e n t o f Commerce and E c o n o m i c D e v e l o p m e n t - S t a t e o f A l a s k a a n d CANADIAN NORTHWEST TRANSPORTATION STUDY H e d l i n M e n z i e s a n d A s s o c i a t e s f o r T r a n s p o r t Canada - 1970 7 1 YUKON TRANSPORTATION STUDY - Swan W o o s t e r E n g i n e e r i n g Co. L t d . (19781 a nd YUKON RAILWAY STUDY - C a n a l o g L o g i s t i c s L t d a n d C a n a d i a n P a c i f i c C o n s u l t i n g S e r v i c e s ( 1 9 7 5) 70 e x t e n s i o n w o u l d p r o v i d e an a l l - r a i l l i n k b e t ween s o u r c e s o f o r e a n d Skagway, A l a s k a . E x i s t i n g h i g h w a y o r e t r u c k movements v i a t h e A l a s k a , K l o n d i k e , a nd R o b e r t C a m p b e l l h i g h w a y s w o u l d no l o n g e r be r e q u i r e d . However o n l y a v e r y s h o r t s e c t i o n o f A l a s k a Highway i s u t i l i z e d u n d e r t h e e x i s t i n g s y s t e m and t h i s l i n k i s p r e s e n t l y p a v e d a n d o f a h i g h p h y s i c a l s t a n d a r d . T h e r e f o r e t h e c a l c u l a t i o n o f r e c o n s t r u c t i o n i n d u c e d u s e r b e n e f i t s w o u l d n o t be d i r e c t l y a f f e c t e d i n t h e e v e n t t h a t t h i s r a i l e x t e n s i o n m a t e r i a l i z e s a t some f u t u r e d a t e . 71 •• 2.8 PROFILE OF E X I S T I N G TRAFFIC : A l a s k a H i g h w a y t r a f f i c f l o w s a r e s e a s o n a l a n d i r r e g u l a r i n n a t u r e . I t i s d i f f i c u l t t o a c q u i r e an a c c u r a t e p r o f i l e o f t h e s e f l o w s u n l e s s o b s e r v a t i o n s a n d d r i v e r i n t e r v i e w s a r e c o n d u c t e d on a l o n g t e r m b a s i s . To d a t e , t h i s h a s n o t been t h e c a s e . T r a f f i c m o n i t o r i n g p r i o r t o 1981 f o c u s s e d on summer t r a f f i c o n l y a n d i t i s n o t known i f c l a s s i f i c a t i o n c o u n t s t a k e n d u r i n g t h i s p e r i o d r e p r e s e n t e d y e a r - r o u n d c o n d i t i o n s . To p a r t i a l l y a l l e v i a t e t h i s p r o b l e m , P u b l i c Works Canada i n i t i a t e d an e x p a n d e d p r o g r a m o f t r a f f i c c l a s s i f i c a t i o n s and' t u r n i n g movement c o u n t s a l o n g t h e A l a s k a H i g h w a y i n 1981. However e v e n t h e s e l a t e s t a n a l y s e s s u f f e r e d f r o m a number o f l i m i t a t i o n s . F o r e x a m p l e , v e h i c l e c l a s s i f i c a t i o n s were c o n d u c t e d f o r p e r i o d s o f o n l y 48 h o u r s , o n l y d u r i n g t h r e e s e a s o n s , a n d no c l a s s i f i c a t i o n s were c o n d u c t e d on w e e k e n d s 7 2 . I t i s r e c o g n i z e d t h a t l i m i t e d f u n d i n g a nd r e s o u r c e s may h a v e r e n d e r e d a much more t h o r o u g h t r a f f i c a n a l y s i s i m p r a c t i c a l o r i m p o s s i b l e i n t h e p a s t . However i t i s i m p o r t a n t t o a c k n o w l e d g e t h e w e a k n e s s e s a n d l i m i t a t i o n s o f t h e w h o l e o f c u r r e n t l y a v a i l a b l e A l a s k a H i g h w a y t r a f f i c f l o w d a t a . T h e s e have a s u b s t a n t i a l b e a r i n g on t h e d e g r e e t o w h i c h f u t u r e f l o w s , t h u s f u t u r e u s e r s a v i n g s , c a n be s u c c e s s f u l l y f o r e c a s t . 7 2 PWC ALASKA HIGHWAY REPORT ( u n p u b l i s h e d ) p. 60 72 D a t a l i m i t a t i o n s i n c l u d e : - T r a f f i c c o u n t s a l o n g t h e h i g h w a y a r e t a k e n by t h e use o f b o t h m e c h a n i c a l a n d e l e c t r o n i c c o u n t e r s . T h e s e a r e o f t e n t h e t a r g e t s o f v a n d a l i s m a n d , b e i n g somewhat i s o l a t e d f r o m m a i n t e n a n c e c r e w s , a r e s e l d o m r e p a i r e d on an i m m e d i a t e b a s i s . I n a d d i t i o n , m e c h a n i c a l c o u n t e r s c o u n t a x l e s , n o t v e h i c l e s , t h u s c o u n t a c c u r a c y i s i n t u r n d e p e n d e n t upon t h e a c c u r a c y o f l i s t e d v e h i c l e c l a s s i f i c a t i o n s a t e a c h c o u n t e r l o c a t i o n . - O r i g i n / d e s t i n a t i o n s t u d i e s o f t o u r i s t t r a f f i c h a v e been c o n d u c t e d i n t h e p a s t and a r e b e l i e v e d t o be f a i r l y r e l i a b l e . However l i t t l e i s known a b o u t c o m m e r c i a l t r a f f i c , s p e c i f i c a l l y what i s c a r r i e d , w h e t h e r i t i s f o r p e r s o n a l o r i n d u s t r i a l c o n s u m p t i o n , a n d what t h e o r i g i n s a n d d e s t i n a t i o n s a r e . Not o n l y d o e s t h i s i m p a i r e x i s t i n g t r a f f i c p r o f i l e s , b u t p r o j e c t i o n s o f f u t u r e f l o w s a r e e v e n more d i f f i c u l t . - As a l l u d e d t o p r e v i o u s l y , v e h i c l e c l a s s i f i c a t i o n a n a l y s e s a r e c o n d u c t e d f o r s h o r t p e r i o d s o f t i m e and t h r o u g h o u t o n l y a p o r t i o n o f t h e y e a r . R e s u l t s a r e t h e n e x t r a p o l a t e d t o r e p r e s e n t t h e e n t i r e y e a r ' s f l o w s . T h i s i n t r o d u c e s an a d d i t i o n a l e l e m e n t o f u n c e r t a i n t y i n t o s t a t e d t r a f f i c v o l u m e d a t a . A p p e n d i x I i l l u s t r a t e s t r a f f i c v o l u m e s and v e h i c l e c l a s s i f i c a t i o n s by l o c a t i o n a l o n g t h e A l a s k a H i g h w a y f o r t h e y e a r 1982. T h e s e e s t i m a t e s h ave been d e r i v e d by a p p l y i n g 1980 v e h i c l e c l a s s i f i c a t i o n d a t a ( t h e l a t e s t a v a i l a b l e ) t o t h e most u p - t o - d a t e AADT c o u n t s p u b l i s h e d f o r 73 t h e A l a s k a H i g h w a y 7 3 . F o r t h e p u r p o s e s o f t h i s r e p o r t , t h e v o l u m e f i g u r e s l i s t e d i n A p p e n d i x I I a r e u s e d t o r e p r e s e n t b a s e y e a r (1984) c o u n t s . T h i s a s s u m p t i o n h a s been made b e c a u s e more c u r r e n t d a t a a r e u n a v a i l a b l e a n d , due t o u n p r e c e d e n t e d e c o n o m i c i n a c t i v i t y i n r e g i o n s s e r v e d by t h e A l a s k a H i g h w a y , i t w o u l d be i n a p p r o p r i a t e t o s i m p l y e x t r a p o l a t e p a s t t r a f f i c v o l u m e t r e n d s . T h i s s t u d y e x p l i c i t l y c l a s s i f i e s v e h i c l e - k m s a s t o w h e t h e r t h e y a r e c o m m e r c i a l o r n o n - c o m m e r c i a l i n n a t u r e . C o m m e r c i a l v o l u m e i s t h e n s u b d i v i d e d by v e h i c l e t y p e ( 2 - a x l e o r 5-a x l e ) . S i n c e u s e r c o s t s o f c o m m e r c i a l v e h i c l e s d e p e n d on r e l a t i v e s i z e , s o do b e n e f i t s i n d u c e d by h i g h w a y r e c o n s t r u c t i o n . Thus c l a s s i f i c a t i o n by v e h i c l e t y p e i s a p r e r e q u i s i t e f o r a c c u r a t e u s e r s a v i n g s d e t e r m i n a t i o n Non-c o m m e r c i a l t r a f f i c i s s u b c a t e g o r i z e d t w i c e , f i r s t a c c o r d i n g t o w h e t h e r i t i s l o c a l o r " t h r o u g h " t r a f f i c and s e c o n d a c c o r d i n g t o v e h i c l e t y p e . The f i r s t c l a s s i f i c a t i o n i s r e q u i r e d b e c a u s e o f t h e d i f f e r e n c e i n o c c u p a n t t i m e c o s t s b e t w e e n l o c a l a n d " t h r o u g h " ( p r i m a r i l y t o u r i s m ) t r a f f i c . I t i s a l s o n e c e s s a r y b e c a u s e d i f f e r e n t m e t h o d o l o g i e s a r e a p p l i e d t o f o r e c a s t e a c h t y p e o f t r a v e l , t h u s t h e v o l u m e o f e a c h i n t h e b a s e y e a r must be known. The l a t t e r s u b -c l a s s i f i c a t i o n by v e h i c l e t y p e i s r e q u i r e d b e c a u s e , a s w i t h c o m m e r c i a l v e h i c l e s , u s e r c o s t s c a n v a r y q u i t e d r a m a t i c a l l y d e p e n d i n g on t h e s i z e a n d d e s i g n o f t h e v e h i c l e . A number 7 3 p r o v i d e d by P u b l i c Works C a n a d a 74 o f i n f o r m a t i o n s o u r c e s h a v e been u s e d t o d e v e l o p a more d e t a i l e d p r o f i l e o f t r a f f i c a l o n g v a r i o u s s e c t i o n s of t h e A l a s k a H i g h w a y . T h e s e i n c l u d e : - p a s t A l a s k a H i g h w a y s t u d i e s , f o r e x a m p l e t h e S t a n f o r d a n d N.D.Lea r e p o r t s - t o u r i s t d o c u m e n t s , f o r e x a m p l e t h e 1978 N o r t h e r n T r a v e l S u r v e y , Y u k o n T o u r i s m I n d u s t r y H i g h l i g h t s , M i l e p o s t , A l a s k a T r a v e l A g e n t M a n u a l , e t c . - r e c e n t d a t a c o l l e c t e d by P u b l i c Works Canada - c o n t a c t s w i t h v a r i o u s c a r r i e r s w h i c h o p e r a t e a l o n g t h e h i g h w a y , f o r e x a m p l e Yukon F r e i g h t L i n e s , C a n a d i a n F r e i g h t w a y s - S t a t i s t i c s C a n ada " F o r H i r e T r u c k i n g S u r v e y " c a t a l o g u e #53-224 I t s h o u l d be n o t e d t h a t t h e s e s o u r c e s a r e n o t a l w a y s i n a g r e e m e n t . F o r e x a m p l e , e s t i m a t e s g i v e n by c a r r i e r r e p r e s e n t a t i v e s w i t h r e s p e c t t o t h e t o t a l a n n u a l v o l u m e o f t o n n a g e c a r r i e d by t r u c k t o t h e Yukon a r e g e n e r a l l y much b e l o w t h o s e l i s t e d by S t a t i s t i c s C a n a d a . W i t h r e c o g n i t i o n t h a t t h e y a r e s u b j e c t t o s i g n i f i c a n t l e v e l s o f u n c e r t a i n t y , t r a f f i c f l o w p r o f i l e s by s e c t i o n a r e a s l i s t e d i n s u b -s e c t i o n s 2.8.1 t o 2.8.4. 75 • 2.8.1 FORT SAINT JOHN - FORT NELSON: Two way v o l u m e a l o n g t h i s s e c t i o n a p p r o x i m a t e s 410 AADT. M o s t o f t h e a u t o t r a f f i c a nd some o f t h e 2 - a x l e t r a f f i c c o n s i s t s o f t o u r i s t v e h i c l e s . The Dawson C r e e k / F o r t S a i n t J o h n a r e a a t t r a c t s r e s i d e n t s o f F o r t N e l s o n b e c a u s e o f i t s s h o p p i n g a n d s p e c i a l i z e d s e r v i c e s . One t h i r d o f t o t a l t r a f f i c a l o n g t h i s s e c t i o n i s b e l i e v e d t o c o n s i s t o f l o c a l t r a f f i c g e n e r a t e d f o r t h i s r e a s o n 7 * . A r e l a t i v e l y m i n o r p o r t i o n o f a u t o v o l u m e i s composed o f l o c a l r e c r e a t i o n a l o r commuter t r a f f i c 7 5 . Much o f t h e c o m m e r c i a l t r a f f i c a l o n g t h i s s e c t i o n o f h i g h w a y i s b e l i e v e d t o be l o c a l i n n a t u r e . I n c l u d e d a r e v e h i c l e s e n g a g e d i n s u p p l y i n g F o r t N e l s o n w i t h c o n s u m e r goods a n d t h o s e m o v i n g o i l r i g s and e q u i p m e n t i n t o a n d o u t o f t h e r e g i o n . C o m m e r c i a l t r a f f i c a l s o c o n s i s t s o f common, c o n t r a c t , a n d p r i v a t e c a r r i e r t h r o u g h t r a f f i c t o Watson L a k e a n d b e y o n d . F o r e x a m p l e , T r i m a c c a r r i e d 223,000 t o n s o f f r e i g h t i n t o t h e Yukon on a c o n t r a c t u a l b a s i s i n 1979 a l o n e . A t o t a l o f 107.5 k i l o m e t e r s o f t h i s s e c t i o n o f h i g h w a y 7 * i n t e r p r e t e d f r o m t h e STANFORD REPORT - t a b l e 40 7 5 Commuter t r a f f i c i n t h i s c a s e r e f e r s t o t h a t i n t h e v i c i n i t y o f s m a l l s e t t l e m e n t s l o c a t e d b e t w e e n t h e m a j o r c o m m u n i t i e s o f F o r t N e l s o n and F o r t S a i n t J o h n . Commuter t r a f f i c w i t h i n F o r t S a i n t J o h n and F o r t N e l s o n i s e x c l u d e d f r o m a n a l y s i s s i n c e o n l y t r a f f i c w h i c h c u r r e n t l y e x i s t s o v e r n o n - r e c o n s t r u c t e d h i g h w a y i s o f r e l e v a n c e i n t h e d e t e r m i n a t i o n o f t h e u s e r s a v i n g s c a l c u l a t i o n . 76 w i l l 'be r e c o n s t r u c t e d u n d e r t h e p r o p o s e d A l a s k a H i g h w a y i m p r o v e m e n t p r o g r a m . I n a d d i t i o n , c u r v e s t r a i g h t e n i n g a n d roadway d i v e r s i o n s w i l l r e d u c e o v e r a l l l e n g t h by 1.5 km. AADT c o u n t s o f a p p r o x i m a t e l y 410 c u r r e n t l y e x i s t , t h e r e f o r e r e l e v a n t v e h i c l e -k i l o m e t e r s i n t h e b a s e y e a r , i n c o r p o r a t i n g a l l t r a f f i c c a t e g o r i e s , a r e c a l c u l a t e d t o be 16,000,000. T h i s v o l u m e c a n be d i s a g g r e g a t e d a s l i s t e d i n TABLE 2-10. ***************************** TABLE 2 — 10 ********************* THOUSAND VEHICLE-KILOMETERS BY CATEGORY (1984) ( f o r t s a i n t John - f o r t n e l s o n ) AUTO/ LIGHT TRUCK ***** AUTO & TRAILER ******* CAMPER/ MOTOR HOME ****** BUS * * * 2 -AXLE **** 5 -AXLE * * * * TOTAL ****** TOURISM LOCAL 2268 4933 596 3540 80 6484 4933 COMMERCIAL * * * * * * * * * * * ** 1 591 * * * * 3302 **** 4893 * * * * TOTAL 7201 596 3540 80 1 591 3302 16310 ************************************************************* The t o u r i s t t r a f f i c i n c l u d e d a b o v e c a n be f u r t h e r c a t e g o r i z e d a s 30% C a n a d i a n a n d 70% n o n - C a n a d i a n i n o r i g i n . Of t h e t o t a l , 47% o r i g i n a t e i n B r i t i s h C o l u m b i a o r c r o s s i n t o C a nada t h r o u g h a b o r d e r s t a t i o n l o c a t e d i n B.C. The r e m a i n i n g 5 3 % o r i g i n a t e i n o t h e r C a n a d i a n r e g i o n s o r c r o s s i n t o Canada t h r o u g h a b o r d e r s t a t i o n l o c a t e d e a s t o f B . C . 7 6 . 77 • 2.8.2. FORT NELSON - WATSON LAKE: T r a f f i c v o l u m e s a l o n g t h i s s e c t i o n o f A l a s k a H i g h w a y a r e c u r r e n t l y 240 AADT. L o c a l n o n - c o m m e r c i a l t r a f f i c b e t w e e n W a t s o n L a k e a n d F o r t N e l s o n i s m i n i m a l s i n c e n e i t h e r c o m m u n i t y o f f e r s much o f an a t t r a c t i o n t o r e s i d e n t s o f t h e o t h e r . F o r t N e l s o n r e s i d e n t s a r e a t t r a c t e d s o u t h t o F o r t S a i n t John/Dawson C r e e k f o r s h o p p i n g a n d s p e c i a l i z e d s e r v i c e s w h i l e r e s i d e n t s o f Watson L a k e d e p e n d on W h i t e h o r s e a nd v i c i n i t y t o f u l f i l l t h e s e n e e d s . L o c a l t r a f f i c i s t h e r e f o r e l i m i t e d t o s h o r t c o m m u t i n g t r i p s g e n e r a t e d by r e s i d e n t s o f s m a l l s e t t l e m e n t s l o c a t e d b e t w e e n t h e c o m m u n i t i e s a t e i t h e r e n d . I n a d d i t i o n , some l o c a l t r a f f i c i s g e n e r a t e d by r e c r e a t i o n a l t r i p s t o Muncho L a k e a nd S t o n e M o u n t a i n p r o v i n c i a l p a r k s . O i l a n d g a s e x p l o r a t i o n a n d d r i l l i n g a c t i v i t y i n t h i s r e g i o n i s m i n i m a l r e l a t i v e t o t h a t w h i c h e x i s t s b e t w e e n F o r t N e l s o n a n d F o r t S a i n t J o h n . Thus l o c a l c o m m e r c i a l t r a f f i c a l o n g t h i s s e c t i o n o f A l a s k a H i g h w a y i s n o t a s h e a v y . However W a t s o n L a k e i s a m a j o r d e s t i n a t i o n a r e a f o r p e t r o l e u m p r o d u c t s w h i c h 7 6 NORTHERN TRAVEL SURVEY (1978) a n d TOURISM INDUSTRY HIGHLIGHTS - Yukon T o u r i s m a nd E c o n o m i c D e v e l o p m e n t 78 a r e s o u r c e d a t t h e P e t r o Canada r e f i n e r y a t T a y l o r ( n e a r F t . S t . J o h n ) and s u b s t a n t i a l c o m m e r c i a l v e h i c l e -k i l o m e t e r s a r e g e n e r a t e d a s a r e s u l t . T r i m a c r e p r e s e n t a t i v e s i n d i c a t e t h a t f o r t y t o f i f t y t h o u s a n d t o n s o f p e t r o l e u m p r o d u c t s a r e t r u c k e d f r o m t h e r a i l t e r m i n u s a t F t . N e l s o n t o Watson L a k e on an a n n u a l b a s i s . From W a t s o n L a k e , r o u g h l y 8000 t o n s / a n n u m o f p e t r o l e u m a r e c a r r i e d t h r o u g h t o W h i t e h o r s e . A s i g n i f i c a n t p o r t i o n o f c o m m e r c i a l t r a f f i c c o n s i s t s o f g e n e r a l f r e i g h t ( c o n s u m e r and i n d u s t r i a l ) d e s t i n e d f o r W a t s o n L a k e a n d t h e T u n g s t e n t o w n s i t e . T h e s e two c o m m u n i t i e s a r e v i r t u a l l y d e p e n d a n t on t h e h i g h w a y mode f o r s u p p l i e s . I t s h o u l d be n o t e d t h a t 7500 t o n s o f t u n g s t e n o r e a r e t r u c k e d f r o m t h e C a n t u n g mine a t T u n g s t e n t o Edmonton by C a n a d i a n F r e i g h t w a y s on an a n n u a l b a s i s . However t h i s t r a f f i c m e r e l y p r o v i d e s a b a c k h a u l f o r t r u c k s c a r r y i n g g e n e r a l f r e i g h t i n t o t h e a r e a a n d d o e s n o t g e n e r a t e o r r e p r e s e n t a d d i t i o n a l A l a s k a H i g h w a y v o l u m e . The p r o p o s e d i m p r o v e m e n t p r o g r a m w i l l r e s u l t i n 427.0 k i l o m e t e r s o f r e c o n s t r u c t e d roadway a l o n g t h i s s e c t i o n r e l a t i v e t o what e x i s t s t o d a y . I n a d d i t i o n , h i g h w a y d i v e r s i o n and c u r v e s t r a i g h t e n i n g w i l l g e n e r a t e a 95.0 k i l o m e t e r r e d u c t i o n i n roadway l e n g t h . Thus a t o t a l o f 45.5 m i l l i o n v e h i c l e - k i l o m e t e r s a r e r e l e v a n t f o r p u r p o s e s o f a n a l y s i s . T h e s e c a n be d i s a g g r e g a t e d a s l i s t e d i n TABLE 2-11. Of t h e t o t a l 5 - a x l e t a f f i c , 79 r o u g h l y 18% i s p e t r o l e u m r e l a t e d , 52% i s d e s t i n e d f o r l o c a t i o n s b e y o n d Watson L a k e , and t h e r e m a i n i n g 30% i s e i t h e r l o c a l i n n a t u r e o r d e s t i n e d f o r Watson L a k e . Of **************************** TABLE 2 — 11 ********************** THOUSAND VEHICLE-KILOMETERS BY CATEGORY ( 1 9 8 4 ) ( f o r t n e l s o n - w a t s o n l a k e ) CAMPERS/ MOTOR BUS HOMES ******* *** TOURISM LOCAL AUTOS/ LIGHT TRUCKS ****** 1 0920 767 AUTOS WITH TRAILERS ******** 2868 171 50 382 2 - 5 -AXLE AXLE **** **** TOTAL ******* 31320 767 COMMERCIAL — ~ 2873 10542 13415 ***** **** ***** *** **** **** ****** TOTAL 11687 2868 17150 382 2893 10542 45502 *************************************************************** t h e t o t a l 2 - a x l e c o m m e r c i a l t r a f f i c , an e s t i m a t e d 6 5 % i s e i t h e r l o c a l i n n a t u r e o r d e s t i n e d f o r Watson L a k e w h i l e t h e r e m a i n i n g 3 5 % i s d e s t i n e d f o r l o c a t i o n s b e y o n d Watson L a k e . • 2.8.3 WATSON LAKE - WHITEHORSE: T r a f f i c v o l u m e s a l o n g t h e u n i m p r o v e d s e c t i o n s o f t h i s h i g h w a y l i n k a p p r o x i m a t e 300 AADT a t t h e p r e s e n t t i m e . Some l o c a l t r a f f i c i s g e n e r a t e d by W h i t e h o r s e ' s a t t r a c t i v e n e s s t o r e s i d e n t s o f Watson L a k e a n d s m a l l e r c o m m u n i t i e s i n b e t w e e n a s a m a j o r s h o p p i n g , g o v e r n m e n t , a nd s e r v i c e c e n t r e . I n a c c o r d a n c e w i t h t h e S t a n f o r d R e p o r t a n d t h e A l a s k a  H i g h w a y Summer T r a f f i c S t u d y ( 1 9 7 1 ) , t r a f f i c g e n e r a t e d 80 f o r t h i s r e a s o n r e p r e s e n t s r o u g h l y 10% o f t o t a l a u t o v o l u m e b e t w e e n Watson L a k e a n d W h i t e h o r s e . T o u r i s m , a s i t i s a l o n g o t h e r s e c t i o n s , i s t h e most s i g n i f i c a n t g e n e r a t o r o f n o n - c o m m e r c i a l t r a f f i c v o l u m e . An a d d i t i o n a l i n f l u x o f t o u r i s t v e h i c l e s i s p r o v i d e d by H i g h w a y 37 w h i c h i n t e r s e c t s t h e A l a s k a H i g h w a y 22 k i l o m e t e r s w e s t o f Watson L a k e . The m a g n i t u d e o f t h i s a d d i t i o n a l t o u r i s t v o l u m e i s h i g h l y u n c e r t a i n b u t an e s t i m a t e o f 15% o f t o t a l t o u r i s t v o lume a l o n g t h i s s e c t i o n w o u l d n o t be u n r e a s o n a b l e b a s e d on t h e l i t t l e d a t a t h a t i s a v a i l a b l e . The v o l u m e o f 5 - a x l e c o m m e r c i a l t r a f f i c i s s u b s t a n t i a l l y l o w e r a l o n g t h i s s e c t i o n r e l a t i v e t o t h a t on more s o u t h e r n p a r t s o f t h e A l a s k a H i g h w a y ; T h i s i s p r i m a r i l y due t o most o f t h e f r e i g h t movements o r i g i n a t i n g i n t h e s o u t h o r e a s t b e i n g t e r m i n a t e d i n Watson L a k e . As w i t h t o u r i s t t r a f f i c , a d d i t i o n a l f r e i g h t v o l u m e e n t e r s t h i s l i n k o f t h e A l a s k a H i g h w a y v i a H i g h w a y 37 j u s t w e s t o f Watson L a k e . T h i s a d d i t o n a l v o l u m e i s e s t i m a t e d t o be 27,000 t o n s a n n u a l l y o r 100 u n i t s 7 7 . The p r o p o s e d i m p r o v e m e n t p r o g r a m i n v o l v e s r e c o n s t r u c t i n g 232.5 k i l o m e t e r s o f h i g h w a y b e t w e e n 7 b a s e d on c o n v e r s a t i o n w i t h A r r o w T r a n s p o r t a t i o n S y s t e m s and Yukon F r e i g h t L i n e s r e p r e s e n t a t i v e s 81 Watson L a k e a n d W h i t e h o r s e . I n a d d i t i o n , t h e o v e r a l l l e n g t h w i l l be r e d u c e d 9.5 k i l o m e t e r s a s a r e s u l t o f roadway d i v e r s i o n a n d c u r v e s t r a i g h t e n i n g . T h e r e f o r e a t o t a l o f 26.5 m i l l i o n b a s e y e a r v e h i c l e k i l o m e t e r s a r e r e l e v a n t i n t h i s a n a l y s i s . T h i s t o t a l c a n be d i s a g g r e g a t e d a s l i s t e d i n TABLE 2-12. R o u g h l y 25% o f *********************** TABLE 2 - 1 2 ************************* THOUSANDS OF VEHICLE-KILOMETERS BY CATEGORY ( 1 9 8 4 ) ( w a t s o n l a k e - w h i t e h o r s e ) AUTOS/ AUTOS CAMPERS/ 2 - 5 -LIGHT WITH MOTOR BUS AXLE AXLE TOTAL TRUCKS TRAILERS HOMES ****** ******** ******* * * * **** * * * * ****** TOURISM 5928 1 560 9256 177 1 6921 LOCAL 3670 3670 COMMERCIAL 1 947 3983 5930 * * * * * * * * * * * * * * * * * * * * * * * * * * * * TOTAL 9598 1 560 9256 177 1 947- 3983 26520 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * t h e 2 - a x l e c o m m e r c i a l t r a f f i c i s e s t i m a t e d t o be d e s t i n e d f o r W h i t e h o r s e a n d b e y o n d . The r e m a i n i n g 7 5 % i s a s sumed l o c a l i n n a t u r e . Of t o t a l 5 - a x l e v o l u m e , r o u g h l y 7 5 % i s e s t i m a t e d t o be d e s t i n e d f o r W h i t e h o r s e a n d b e y o n d , a n d o f t h i s , 25% i s assumed t o h a v e e n t e r e d t h e A l a s k a Highway v i a H i g h w a y 37 A p p r o x i m a t e l y 15% o f t o t a l t o u r i s t v o l u m e a l o n g t h i s s e c t i o n i s assumed t o have e n t e r e d t h e A l a s k a H i g h w a y v i a H i g h w a y 37. 82 • 2.8.4 WHITEHORSE - YUKON/ALASKA BORDER: T r a f f i c v o l u m e s a l o n g t h i s s e c t i o n a r e c u r r e n t l y 400 AADT between W h i t e h o r s e a n d H a i n e s J u n c t i o n a n d 260 AADT be t w e e n H a i n e s J u n c t i o n a n d t h e A l a s k a / Y u k o n b o r d e r . C o m m e r c i a l v o l u m e i s l o w e r t h a n a l o n g any o t h e r s e c t i o n o f t h e A l a s k a H i g h w a y . I n d u s t r i a l a c t i v i t y i n t h e r e g i o n i s v i r t u a l l y n o n - e x i s t a n t , t h e r e f o r e l i t t l e c o m m e r c i a l t r a f f i c i s g e n e r a t e d l o c a l l y . I n a d d i t i o n , most c o m m e r c i a l t h r o u g h t r a f f i c t e r m i n a t e s i n W h i t e h o r s e . A s i g n i f i c a n t p o r t i o n o f t h r o u g h c o m m e r c i a l t r a f f i c w h i c h e x i s t s n o r t h o f H a i n e s J u n c t i o n i s b e l i e v e d t o e n t e r t h e A l a s k a H i g h w a y a t H a i n e s J u n c t i o n v i a t h e H a i n e s Road a n d A l a s k a S t a t e M a r i n e H i g h w a y s e r v i c e . T h r e e - q u a r t e r s o f a l l A l a s k a H i g h w a y t o u r i s t s c o n t i n u e t h r o u g h t o A l a s k a f r o m W h i t e h o r s e 7 8 . I n a d d i t i o n t o t h i s ' v o l u m e , a s t r e a m o f v e h i c l e b a s e d t o u r i s t s e n t e r s t h e A l a s k a H i g h w a y a t e i t h e r W h i t e h o r s e o r H a i n e s J u n c t i o n a f t e r i n i t i a l t r a v e l t o t h e n o r t h by A l a s k a M a r i n e H i g h w a y f e r r y s e r v i c e s . R o u g h l y 32,000 p e r s o n s c r o s s i n t o t h e Yukon v i a t h e H a i n e s r o a d on an a n n u a l b a s i s . A n o t h e r 40,000 p e r s o n s e n t e r t h e Yukon v i a t h e 7 8 NORTHERN TRAVEL SURVEY ( 1 9 7 8 ) - Yukon T o u r i s m a n d E c o n o m i c D e v e l o p m e n t 7 9 YUKON TOURISM INDUSTRY HIGHLIGHTS ( 1 9 8 0 ) p.32 83 C a r c r o s s - S k a g w a y H i g h w a y 7 9 . I t i s i m p o r t a n t t o n o t e t h a t t h e s e t o u r i s t s u t i l i z e a v a r i e t y o f r o u t e a n d mode o p t i o n s . W h i l e some may t r a v e l t o A l a s k a a n d r e t u r n v i a H a i n e s o r Skagway a nd t h e f e r r y s y s t e m , o t h e r s may r e t u r n e n t i r e l y by way o f t h e A l a s k a H i g h w a y o r an A l a s k a H i g h w a y / H i g h w a y 37 c o m b i n a t i o n . S t i l l o t h e r s may s i m p l y d r i v e t h e c i r c l e r o u t e f r o m H a i n e s t o Skagway o r v i c a v e r s a v i a t h e H a i n e s , A l a s k a , a n d C a r c r o s s / S k a g w a y H i g h w a y s a nd a g a i n p a t r o n i z e t h e A l a s k a M a r i n e H i g h w a y f o r t h e i r t r i p home. Most o f t h e 40,000 p e r s o n s who e n t e r t h e Yukon v i a t h e C a r c r o s s Skagway H i g h w a y do so a s t o u r b us p a s s e n g e r s . T h e s e t o u r i s t s g e n e r a l l y d i s e m b a r k f r o m c r u i s e s h i p s a t Skagway f o r d a y t r i p s a n d w o u l d r a r e l y e v e n s e e n o n - i m p r o v e d s e c t i o n s o f A l a s k a H i g h w a y . Some l o c a l n o n - c o m m e r c i a l t r a f f i c i s g e n e r a t e d by r e s i d e n t s o f s m a l l c o m m u n i t i e s l o c a t e d b e t w e e n W h i t e h o r s e a n d t h e Y u k o n / A l a s k a b o r d e r who a r e a t t r a c t e d t o W h i t e h o r s e f o r i t s s h o p p i n g a n d s p e c i a l i z e d s e r v i c e s . I n a d d i t i o n a l i m i t e d v o l u m e o f l o c a l t r a f f i c i s g e n e r a t e d by r e s i d e n t s o f W h i t e h o r s e who u s e t h i s l i n k o f A l a s k a H i g h w a y t o a c c e s s K l u a n e L a k e a n d K l u a n e N a t i o n a l P a r k f o r r e c r e a t i o n a l p u r p o s e s . The p r o p o s e d i m p r o v e m e n t p r o g r a m i n v o l v e s r e c o n s t r u c t i n g 411 k i l o m e t e r s o f h i g h w a y a l o n g t h i s 84 s e c t i o n . A d i s t a n c e s a v i n g s o f 18 k i l o m e t e r s w i l l a l s o d e v e l o p a s a r e s u l t o f roadway d i v e r s i o n . T h e r e f o r e 44.8 m i l l i o n a n n u a l v e h i c l e - k i l o m e t e r s a r e r e l e v a n t f o r a n a l y s i s a l o n g t h i s l i n k o f t h e A l a s k a H i g h w a y . D i s a g g r e g a t i o n i s a s l i s t e d i n TABLE 2-13. Of t h e non-*********************** TABLE 2~13 *********************** THOUSAND VEHICLE-KILOMETERS BY CATEGORY (1984) ( w h i t e h o r s e - y u k o n / a l a s k a b o r d e r ) AUTO/ AUTOS CAMPER/ 2 - 5 -LIGHT WITH MOTOR BUS AXLE AXLE TOTAL TRUCK TRAILER ' HOME ***** ******* ****** *** **** **** ***** TOURISM 11572 LOCAL 2956 COMMERCIAL ****** TOTAL 14528 3052 18065 313 **** ***** *** 3052 18065 313 31090 4 8 6 9 5744 3132 8876 **** **** ***** 5744 3132 44835 c o m m e r c i a l v o l u m e w h i c h e x i s t s b e t w e e n W h i t e h o r s e a n d H a i n e s J u n c t i o n , 6 0 % i s e s t i m a t e d t o be " t h r o u g h " t o u r i s t t r a f f i c , a n d 2 0 % t o be t o u r i s t s who use t h i s l i n k o f t h e A l a s k a H i g h w a y a s one l e g o f one o f t h e f o l l o w i n g c i r c l e r o u t e o p t i o n s : 85 1. F e r r y — SKAGWAY — C a r c r o s s H i g h w a y — WHITEHORSE — A l a s k a Highway * HAINES  JUNCTION — H a i n e s Road — HAINES — f e r r y 2. A i r o r A l a s k a H i g h w a y — WHITEHORSE •*• A l a s k a H i g h w a y — HAINES JUNCTION — H a i n e s Road - HAINES — SHUTTLE FERRY — SKAGWAY - C a r c r o s s H i g h w a y — WHITEHORSE - * - a i r o r A l a s k a H i g h w a y The r e m a i n i n g 2 0 % of n o n - c o m m e r c i a l t r a f f i c i s assumed t o be l o c a l v o l u m e g e n e r a t e d by r e s i d e n t s o f t h e Y u k o n . •• 2.9 PROJECT OVERVIEW: An i n f i n i t e number o f a l t e r n a t i v e r e c o n s t r u c t i o n s t r a t e g i e s c o u l d be d e v e l o p e d a n d a p p l i e d t o t h e A l a s k a H i g h w a y . S t r a t e g y v a r i a b l e s i n c l u d e : - w i d t h o f h i g h w a y s u r f a c e - maximum t o l e r a b l e g r a d i e n t - maximum t o l e r a b l e h o r i z o n t a l a l i g n m e n t - t h e e x t e n t t o w h i c h t h e new r o a d b e d d i v e r g e s f r o m t h a t w h i c h c u r r e n t l y e x i s t s - t i m i n g o f c o n s t r u c t i o n a c t i v i t i e s The l i m i t e d t i m e a n d f u n d s a v a i l a b l e t o c o m p l e t e t h i s p a p e r do n o t p e r m i t an i n d i v i d u a l a n a l y s i s o f e a c h o f a v a r i e t y o f s t r a t e g y a l t e r n a t i v e s t o be d e v e l o p e d . R a t h e r an 86 a n a l y s i s i s u n d e r t a k e n o f one s p e c i f i c a l t e r n a t i v e . D i s c u s s i o n s w i t h PWC e n g i n e e r s a n d i n v e s t i g a t i o n s o f p a s t h i g h w a y s t u d i e s s u g g e s t t h e s t r a t e g y on w h i c h t h i s p a p e r f o c u s e s i s f e a s i b l e i n an e c o n o m i c s e n s e a n d w o u l d c l o s e l y p a r a l l e l a c t u a l c o n s t r u c t i o n p r a c t i s e s i n t h e e v e n t t h a t t h e A l a s k a H i g h w a y were e n t i r e l y r e c o n s t r u c t e d . D e t a i l s o f minimum t o l e r a b l e s t a n d a r d s f o r r e c o n s t r u c t e d s e c t i o n s o f t h e h i g h w a y a r e assumed t o be: TOTAL SURFACE WIDTH 7.3 METERS SHOULDER WIDTH 2.35 METERS STOPPING SIGHT DISTANCE 200 METERS PASSING SIGHT DISTANCE 680 METERS MINIMUM CURVE RADIUS 380 METERS MAXIMUM GRADIENT 6 PERCENT DESIGN AXLE LOAD 9000 KGMS DEPTH OF ASPHALTIC CONCRETE 80 MILIMETERS T h e s e s t a n d a r d s c o n f o r m t o t h e R u r a l A r t e r i a l U n d i v i d e d 100 kph c l a s s i f i c a t i o n (RAU 1 0 0 ) . P u b l i c Works Canada e n g i n e e r s i n d i c a t e t h a t a t t e m p t s w i l l be made t o a t t a i n RAU 100 s t a n d a r d s t h r o u g h o u t t h e e n t i r e h i g h w a y , a n d t h i s h a s been t h e p r a c t i s e i n t h e l i m i t e d r e c o n s t r u c t i o n w h i c h h a s a l r e a d y t a k e n p l a c e a l o n g t h i s r o u t e . H owever, b e c a u s e o f a d v e r s e t o p o g r a p h y i n some a r e a s , i t i s u n l i k e l y t h e s e s t a n d a r d s w i l l be a c h i e v e d i n t h e v i c i n i t y o f K l u a n e L a k e a n d t h e W h i t e R i v e r . F o r s i m p l i c i t y , t h i s r e p o r t assumes t h a t t h e e n t i r e r o u t e w i l l be r e c o n s t r u c t e d t o c o n f o r m t o t h e RAU 100 c l a s s i f i c a t i o n . A p p e n d i x I I p r o v i d e s d e t a i l s o f t h e e x i s t i n g s u r f a c e 87 q u a l i t y a n d p h y s i c a l r o a d b e d s t a n d a r d s o f t h e A l a s k a H i g h w a y by l o c a t i o n . A p p e n d i x I I I p r o v i d e s d e t a i l s o f c u r r e n t h o r i z o n t a l and v e r t i c a l a l i g n m e n t s a l o n g t h e h i g h w a y . By c o n t r a s t i n g t h e A l a s k a H i g h w a y ' s e x i s t i n g s t a t u s , a s s u m m a r i z e d i n t h e s e a p p e n d i c e s , w i t h t h e RAU 100 s t a n d a r d s l i s t e d a b o v e , an i n d i c a t i o n o f t h e e x t e n t o f r e c o n s t r u c t i o n i n v o l v e d i n t h i s p r o p o s a l i s made a v a i l a b l e . A l t h o u g h some s e c t i o n s o f t h e e x i s t i n g A l a s k a H i g h w a y p r e s e n t l y c o n f o r m t o RAU 100 s t a n d a r d s , most do n o t . S u r f a c e w i d t h s o f 7 o r 8 m e t e r s a r e t y p i c a l a l o n g t h i s r o u t e . C u r v e r a d i i o f 200 m e t e r s and v e r t i c a l g r a d e s o f more t h a n 10% a r e n o t uncommon. R e c o n s t r u c t i o n a n d p a v i n g t h e e x i s t i n g h i g h w a y , w i t h m a j o r d i v e r s i o n s , w i l l s i g n i f i c a n t l y r e d u c e t h e o v e r a l l l e n g t h o f t h e r o u t e . D e c r e a s i n g t h e more e x t r e m e v e r t i c a l a n d h o r i z o n t a l a l i g n m e n t s t o t o l e r a b l e s t a n d a r d s w i l l , i n i t s e l f , p r o v i d e a r e d u c t i o n o f r o u g h l y 16 k i l o m e t e r s 8 0 . I n a d d i t i o n , d i s t a n c e r e d u c t i o n s g e n e r a t e d by e x t e n s i v e r o a d b e d d i v e r s i o n a l o n g t h e r o u t e a r e a s l i s t e d i n TABLE 2-1 4 8 1 . 8 0 ALASKA HIGHWAY ENGINEERING STUDY - PWC (1966) p. 103 8 1 I b i d . P.101 88 C o n s t r u c t i o n i s assumed t o b e g i n i n 1984 and t e r m i n a t e i n l a t e 1989. T h i s scheme w o u l d r e q u i r e r o u g h l y 750 man y e a r s p e r y e a r o f c o n s t r u c t i o n a n d i s b e l i e v e d f e a s i b l e b a s e d on f i n d i n g s o f o t h e r s t u d i e s 8 2 . C o n s t r u c t i o n a c t i v i t y i s ************ TABLE 2~14 ************ DIVERSION RELATED DISTANCE SAVINGS LOCATION DISTANCE SAVINGS ******** **************** KM 516-819 . KM 872-918 . KM 1122-1148 KM 1262-1292 KM 1516-1541 KM 1660-1700 82 KILOMETERS 6.5 KILOMETERS 1 . 6 KILOMETERS 4.9 KILOMETERS 1 .6 KILOMETERS 11.5 KILOMETERS ************************************ assumed t o t a k e p l a c e c o n c u r r e n t l y a l o n g e a c h o f t h e f o l l o w i n g h i g h w a y s e c t i o n s w i t h c o m p l e t i o n o f e a c h s e c t i o n by t h e same d a t e ( l a t e 1 9 8 9 ) . 1. F t . S t . J o h n - F t . N e l s o n 2. F t . N e l s o n - W a t s o n L a k e 2 I n 1974, e x e c u t i v e s e m p l o y e d by s e v e r a l c o n s t r u c t i o n c o m p a n i e s f e l t t h a t a manpower r e q u i r e m e n t o f more t h a n 675 man y e a r s p e r y e a r o f c o n s t r u c t i o n w o u l d s e v e r e l y s t r a i n t h e p o o l o f a v a i l a b l e l a b o u r ( f r o m HIGHWAYS IN NORTHERN B R I T I S H COLUMBIA - P R I O R I T I E S ,  TIMING AND B E N E F I C I A R I E S - CTS,UBC ( 1 9 7 4 ) ) = I t i s b e l i e v e d t h a t t h e g e n e r a l g r o w t h i n p o p u l a t i o n a n d c o r r e s p o n d i n g l a b o u r f o r c e i n t h i s r e g i o n , c o m b i n e d w i t h c u r r e n t h i g h l e v e l s o f une m p l o y m e n t , s h o u l d deem 750 man y e a r s / y e a r t o be a r e a s o n a b l e a n d n o n - d i s r u p t i v e l e v e l 89 3. 'Watson L a k e - W h i t e h o r s e 4. W h i t e h o r s e - A l a s k a / Y u k o n b o r d e r R e s o u r c e c o s t s and o t h e r d e t a i l s s p e c i f i c a l l y r e l a t e d t o p r o p o s e d r e c o n s t r u c t i o n a c t i v i t y a r e p r o v i d e d i n t h e f o l l o w i n g c h a p t e r . 90 ••• CHAPTER 3 ••• COSTS OF RECONSTRUCTION  AND INCREMENTAL HIGHWAY MAINTENANCE SAVINGS Hi g h w a y r e c o n s t r u c t i o n a n d m a i n t e n a n c e c o s t s c a n v a r y c o n s i d e r a b l y f r o m one h i g h w a y o r r e g i o n t o a n o t h e r . Some o f t h e f a c t o r s w h i c h i n f l u e n c e t h e l e v e l o f r e q u i r e d e x p e n d i t u r e s a r e : - t h e d i s t a n c e b e t w e e n s o u r c e a n d s u p p l y o f a g g r e g a t e , a s p h a l t , a n d o t h e r m a t e r i a l s u s e d i n h i g h w a y c o n s t r u c t i o n - r e g i o n a l p r i c e o f l a b o u r a n d o t h e r i n p u t s - t h e e x t e n t t o w h i c h p e r m a f r o s t e x i s t s i n t h e r e g i o n - l o c a l t o p o g r a p h i c p r o f i l e - t h e s t r e n g t h o f m a t e r i a l s u n d e r l y i n g t h e p r o p o s e d r o a d b e d T h i s c h a p t e r i s d i v i d e d i n t o two m a j o r p a r t s . P a r t 1 ( s e c t i o n s 3.1 a n d 3.2) t a b u l a t e s r e c o n s t r u c t i o n c o s t s f o r v a r i o u s s e c t i o n s o f t h e A l a s k a H i g h w a y a l o n g w i t h a s s o c i a t e d i n c r e m e n t a l m a i n t e n a n c e s a v i n g s . T h e s e f i g u r e s a r e b a s e d p r i m a r i l y on d a t a p r o v i d e d by P u b l i c Works C a n a d a . P a r t 2 ( s e c t i o n 3.3) i s somewhat more a n a l y t i c a l i n n a t u r e . I t a d j u s t s t h e f i g u r e s p r e s e n t e d i n 3.1 and 3.2 t o r e f l e c t c u r r e n t h i g h l e v e l s o f u n e m p l o y e d r e s o u r c e s a n d p r o j e c t e d wage l e v e l t r e n d s i n r e l a t i o n t o g e n e r a l i n f l a t i o n . 91 3.1 DIRECT COSTS ASSOCIATED WITH HIGHWAY RECONSTRUCTION B a s e d on a d e t a i l e d e n g i n e e r i n g s t u d y u n d e r t a k e n i n 1966 and an a n a l y s i s o f r e c o n s t r u c t i o n c o n t r a c t s a w a r d e d b e t w e e n 1969 a n d 1981, PWC d e v e l o p e d 1980 c o s t s o f r e c o n s t r u c t i n g t h e A l a s k a H i g h w a y t o R.A.U. 100 s t a n d a r d s . A f t e r i n f l a t i n g t h e s e f i g u r e s by 1 . 2 7 8 3 t o b r i n g them t o b a s e y e a r ( 1 9 84) v a l u e s , t h e c o s t s a r e a s l i s t e d i n TABLE 3-1. I n a d d i t i o n ********************* TABLE 3 -1 ************************* PER KILOMETER CONSTRUCTION COSTS - 1984 DOLLARS HIGHWAY SECTION *************** CLEARING/ GRADING & SUB-BASE 8" ********* PAVING * * * * * * * TOTAL * * * * * * * FT.ST.JOHN-FT.NELSON 395,000 119,000 514,000 FT.NELSON-WATSON LAKE 360,000 119,000 479,000 WATSON LAKE-WHITEHORSE 337,000 119,000 456,000 WHITEHORSE-BORDER 310,000 119,000 427,000 ********************************************************* t o t h e u n i m p r o v e d l e n g t h s l i s t e d a b o v e , r o u g h l y 200 k i l o m e t e r s o f A l a s k a H i g h w a y a r e u n s u r f a c e d b u t o t h e r w i s e c o n f o r m t o RAU 100 s t a n d a r d s . T h e s e s e c t i o n s a r e 12 m e t e r s i n w i d t h a n d ha v e h ad b a s e c o u r s e s a n d s u b - b a s e s p r e p a r e d t o a c c e p t a p e r m a n e n t a s p h a l t i c c o n c r e t e s u r f a c e . I t i s assumed f o r t h e p u r p o s e s o f t h i s r e p o r t t h a t t h e a s y e t u n p a v e d s e c t i o n s w i l l be s u r f a c e d a n d c o n f o r m e n t i r e l y t o 3 b a s e d on t h e C a n a d i a n I n d u s t r i a l S e l l i n g P r i c e I n d e x a s r e p o r t e d i n S t a t s . C a nada c a t a l o g u e #62-011 92 RAU 100 s t a n d a r d s by t h e t i m e m a j o r h i g h w a y r e c o n s t r u c t i o n b e g i n s . They h a v e a c c o r d i n g l y been e x c l u d e d . TABLE 3-2 i n d i c a t e s t h e l e n g t h s o f r o a d b e d a l o n g e a c h o f t h e a b o v e l i s t e d h i g h w a y s e g m e n t s w h i c h were n o t c o n s t r u c t e d t o RAU 100 s t a n d a r d s a s o f M a r c h , 1 9 8 3 8 5 . *************** TABLE 3 - 2 ***************** HIGHWAY LENGTH TO BE RECONSTRUCTED SECTION KILOMETERS-UNIMPROVED FORT ST.JOHN - FORT NELSON 109 FT. NELSON - WATSON LAKE 52 2 WATSON LAKE - WHITEHORSE 242 WHITEHORSE - BORDER 429 TOTAL 1302 ******************************************** B e c a u s e o f h i g h w a y s h o r t e n i n g i n d u c e d by d i v e r t i n g t h e r o a d b e d f r o m i t s p r e s e n t c o u r s e , t h e t o t a l l e n g t h o f n e w l y r e c o n s t r u c t e d h i g h w a y , g i v e n t h e p r o p o s e d i m p r o v e m e n t p r o g r a m , w i l l be somewhat l e s s t h a n t h e t o t a l k i l o m e t e r s l i s t e d i n t h e a b o v e t a b l e . A f t e r a d j u s t i n g f o r t h i s f a c t o r , t o t a l c o s t s o f r e c o n s t r u c t i n g t h e A l a s k a H i g h w a y i n 1984 d o l l a r s a r e a s l i s t e d i n TABLE 3-3. The l i f e e x p e c t a n c y o f g r a d i n g a n d b a s e i s assumed t o be 40-50 y e a r s . T h i s e s t i m a t e i s c o n s i s t e n t w i t h b o t h p u b l i s h e d s o u r c e s 8 6 a n d 8 4 i n c l u d i n g 2 0 % f o r c o n t i n g e n c i e s a n d e n g i n e e r i n g 8 5 ALASKA HIGHWAY - STATUS OF RECONSTRUCTION ( 3 / 1 9 8 3 ) by P u b l i c W orks C a n a d a 8 6 f o r e x a m p l e , HIGHWAY ENGINEERING C . H . O g l e s b y - 1966 ( p . 6 0 ) 93 t h e 1966 PWC A l a s k a H i g h w a y e n g i n e e r i n g s t u d y . Pavement l i f e i s assumed t o be 20 y e a r s 8 7 . Roadbed r e c o n s t r u c t i o n c o s t s i n y e a r 40 and r e s u r f a c i n g c o s t s i n y e a r 20 o f t h e p r o j e c t t i m e h o r i z o n a r e e x p e c t e d t o be c o n s i d e r a b l y l e s s ************************* TABLE 3 — 3 ***************************** ESTIMATED CONSTRUCTION COSTS HIGHWAY SECTION ************ FT.ST.JOHN -FT.NELSON ., FT.NELSON -WATSON LAKE WATSON LAKE -WHITEHORSE , WHITEHORSE -BORDER CURRENT TOTAL 1 REQUIRED COST NON- REDUCTION LENGTH OF PER IMPROVED IN HIGH- RECONSTRUCTED KM. LENGTH WAY LENGTH HIGHWAY ******** ********** ************ ***** 109 KM 522 KM 242 KM 429 KM ****** 1 .5 KM 95.0 KM 9.5 KM 18.1 KM ******* 107.5 KM 427.0 KM 232.5 KM 410.9 KM ******** 514 479 456 TOTAL COST PER SECTION ( $ 0 0 0 ' S ) ********* 55,255 204,533 106,020 427 175,454 **** ******* TOTAL 1,302 KM 124.1 KM 1,177.9 KM -- 541,262 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 1 n o t e : r e d u c t i o n i n h i g h w a y l e n g t h i n c l u d e s t h a t due t o roadway d i v e r s i o n p l u s a r e l a t i v e l y m i n o r a d j u s t m e n t t o a c c o u n t f o r c u r v e s t r a i g h t e n i n g ( i n r e a l d o l l a r s ) t h a n t h o s e i n c u r r e d d u r i n g i n i t i a l r e c o n s t r u c t i o n . F o r e x a m p l e , c l e a r i n g a r i g h t - o f - w a y s h o u l d n o t be r e q u i r e d f o r s u b s e q u e n t r e c o n s t r u c t i o n s e x c e p t f o r t h e u n l i k e l y s c e n a r i o t h a t h o r i z o n t a l a l i g n m e n t s a r e e x t e n s i v e l y m o d i f i e d t o a c h i e v e d e s i g n s p e e d s i n e x c e s s o f 100 k p h . I n a d d i t i o n , m a t e r i a l r e q u i r e m e n t s d u r i n g 7 a b o v e a n d INTRODUCTION TO TRANSPORTATION ENGINEERING AND PLANNING - E . K . M o r l o k - 1978 94 s u s e q u e n t r e c o n s t r u c t i o n a n d s u r f a c i n g a r e c o n s i d e r a b l y b e l o w t h o s e o f o r i g i n a l r e c o n s t r u c t i o n . PWC h a s e s t i m a t e d r e s u r f a c i n g c o s t s t o be $57,000 p e r k i l o m e t e r i n y e a r 20 c o m p a r e d t o $94,000 f o r i n i t i a l a s p h a l t i c c o n c r e t e s u r f a c i n g (1980 d o l l a r s ) . The PWC e s t i m a t e f o r r e s u r f a c i n g c o s t s i s u s e d i n t h i s s t u d y a s i s t h e a s s u m p t i o n t h a t c o s t s a s s o c i a t e d w i t h r e c o n s t r u c t i o n i n y e a r 40 w i l l be s u b s t a n t i a l l y l e s s t h a n t h o s e i n c u r r e d d u r i n g o r i g i n a l ( 1 9 8 4 - 1 9 8 9 ) r e c o n s t r u c t i o n . •• 3.2 INCREMENTAL HIGHWAY MAINTENANCE SAVINGS: The r e p a v i n g o f an a s p h a l t i c c o n c r e t e s u r f a c e i n y e a r 20 o f t h e p r o j e c t s t u d y p e r i o d i s a c k n o w l e d g e d t o be a c a p i t a l e x p e n d i t u r e . H owever, f o r t h e s a k e o f c o n v e n i e n c e , t h i s s t u d y t r e a t s r e s u r f a c i n g e x p e n d i t u r e s a s s o c i a t e d w i t h b o t h g r a v e l a n d BST s u r f a c e s a s p a r t o f r o u t i n e m a i n t e n a n c e . B a s e d on PWC d a t a , t h e s e c o s t s a r e a s l i s t e d i n TABLE 3-4. ******************* TABLE 3 - 4 ******************** TYPICAL RESURFACING COST PER YEAR (1984 DOLLARS) TYPE SURFACE L I F E RESURFACING COST RESURFACING COST PER Km PER YEAR * * ** ************ *********** **************** BST GRAVEL 5 y e a r s 3 y e a r s $35,560 $13,970 $7,112 $4,657 ************************************************** 95 Other maintenance c o s t s provided by PWC and based on a c t u a l expenditures i n c u r r e d d u r i n g r o u t i n e maintenance of the Yukon s e c t i o n of the Alaska Highway are l i s t e d i n TABLE 3-5. Surface maintenance components i n c l u d e CaCl ********************** TABLE 3 —5 ************************ MAINTENANCE COST PER KILOMETER (RESURFACING EXCLUDED) SURFACE 1984$/Km 1984$/Km 1984$/Km TYPE FOR FOR OTHER FOR COST SURFACE DISTANCE RELATED MAINTENANCE RELATED OVERHEAD ******** *********** ********* ******** TOTAL ROUTINE MAINTENANCE 1 984$ PER KILOMETRE ************** PAVEMENT $762 BST $1,905 GRAVEL $3,810 $2,019 $2,019 $2,019 $1,181 $1,676 $2,489 $3,962 $5,600 $8,318 ********************************************************* a p p l i c a t i o n s , crack s e a l i n g , p a t c h i n g , sweeping, b l a d i n g of g r a v e l shoulders, and p a i n t i n g of t r a f f i c l a n e s . Distance r e l a t e d maintenance items i n c l u d e c o s t s which are independent of s u r f a c e type and i n c l u d e such items as c u l v e r t r e p a i r s , d i t c h i n g , mowing, weed c o n t r o l , s i g n placement and maintenance, e t c . Overhead c o s t s i n c l u d e management and s u p e r v i s i o n , s t a f f t r a i n i n g programs, camp o p e r a t i o n , ambulance s e r v i c e s , t r a v e l and r e l o c a t i o n , as w e l l as o p e r a t i o n of the r a d i o network. While i t may be an a c c e p t a b l e p r a c t i s e f o r bookeeping purposes to a l l o c a t e these overhead items on the b a s i s of maintenance c o s t s otherwise i n c u r r e d , i t i s d o u b t f u l that a one-to-one cau s u a l r e l a t i o n s h i p between overhead and other maintenance 96 c o s t s e x i s t s i n r e a l i t y . F o r e x a m p l e , t h e c o s t o f s t a f f t r a i n i n g p r o g r a m s a n d t h e r a d i o n e t w o r k l i k e l y h a v e a s i z a b l e f i x e d component p l u s a v a r i a b l e component w h i c h c o r r e l a t e s q u i t e c l o s e l y w i t h t h e number o f r e q u i r e d m a i n t e n a n c e p e r s o n n e l o r camps. T h e r e f o r e w h i l e u p g r a d i n g and p a v i n g t h e A l a s k a H i g h w a y may r e d u c e n o n - o v e r h e a d m a i n t e n a n c e i t e m s by a g i v e n p e r c e n t a g e , i t i s u n r e a l i s t i c a n d a n a l y t i c a l l y i n e r r o r t o assume t h a t o v e r h e a d c o s t s w i l l d e c l i n e by a s i m i l a r p e r c e n t a g e . F o r p u r p o s e s o f t h i s s t u d y , o n l y 75% o f o v e r h e a d m a i n t e n a n c e e x p e n d i t u r e s a r e c o n s i d e r e d f i x e d . A d j u s t i n g f o r t h i s f a c t o r a n d i n c l u d i n g r e s u r f a c i n g c o s t s , t o t a l m a i n t e n a n c e c o s t s p e r k i l o m e t e r a r e c a l c u l a t e d a s l i s t e d i n TABLE 3-6. H i g h w a y m a i n t e n a n c e *********************** TABLE 3 - 6 ***************************** TOTAL ADJUSTED HIGHWAY MAINTENANCE COSTS SURFACE TOTAL ROUTINE SUBTRACT ADD TOTAL MAINTENANCE TYPE MAINTENANCE OVERHEAD RESURFACING COST PER Km (1 9 8 4 ) ADJUSTMENT COSTS (1984) ******* ************* ********** ******** **************** PAVEMENT $3,962 ( $ 2 9 5 ) - - - 8 8 $ 3 , 6 6 7 y BST $5,600 ( $ 4 1 9 ) $7,112 $12,293 GRAVEL $8,318 ( $ 6 2 2 ) $4,657 $12,353 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * s a v i n g s a r e e x p e c t e d t o e x i s t i n two d i s t i n c t f o r m s . F i r s t , i m p r o v e d a l i g n m e n t s a n d roadway d i v e r s i o n s w i l l reduce©^ t h e 8 8 p a v i n g i s c o n s i d e r e d t o be a c a p i t a l r a t h e r t h a n a m a i n t e n a n c e e x p e n s e 97 lengths of surface and roadbed, thus associated maintenance e f f o r t . Second, conversion from CaCl and BST surfaces, which require v i r t u a l l y continual attention, to an asphaltic-concrete surface, w i l l reduce required highway maintenance by a considerable amount. Total highway maintenance savings are calculated as l i s t e d in TABLE 3-7. ************************* TABLE 3 _7 *************************** REDUCTION IN MAINTENANCE DUE TO SURFACE IMPROVEMENTS AND REDUCTION IN ROADWAY LENGTH HIGHWAY CURRENT MAINTENANCE MAINTENANCE COST TOTAL SEGMENT COST (1984$) OF OF RECONSTRUCTED ANNUAL NON-RECONSTRUCTED HIGHWAY (1984$) MAINTENANCE HIGHWAY SAVINGS ************** ******************* ***************** *********** FT.ST.JOHN -FT NELSON (59)X(12293)=725287 (50)X(12353)=617650 $1342937 (107.5)X(3667)= $394202 $ 948,734 FT. NELSON - (482)X(12293)=5925226 WATSON LAKE (40)X(12353)= 494120 (427.0)X(3667)= $6419346 $1565809 $4,853,537 WATSON LAKE -WHITEHORSE WHITEHORSE -BORDER (184)X(12293)=2261912 (58)X(12307)= 713806 $2975718 (343)X(12293)=4316499 (86)X(12305)=1058230 (232.5)X(3667)= $852577 $2,123,140 (410.9)X(3667)= $5274779 $1506770 $ 3,768,002 TOTAL • $11,693,419 **************************************************************** 98 The s a v i n g s o f $ 11,693,419 p e r y e a r ( b a s e y e a r d o l l a r s ) w i l l , o f c o u r s e , n o t be f u l l y r e a l i z e d u n t i l r e c o n s t r u c i o n i s c o m p l e t e i n 1989. I t i s assumed t h a t o n e - s i x t h o f t h i s amount w i l l be s a v e d e a c h y e a r on a c o m m u l a t i v e b a s i s u n t i l p r o j e c t c o m p l e t i o n i n t h a t y e a r . •• 3.3 DIRECT SOCIAL COSTS OF ALASKA HIGHWAY RECONSTRUCTION AND  ASSOCIATED MAINTENANCE SAVINGS: The c o s t e s t i m a t e s d i s c u s s e d i n s e c t i o n s 3,1 a n d 3.2 a r e d e r i v e d f r o m m a r k e t p r i c e s w h i c h a r e b a s e d on h i s t o r i c a l e x p e r i e n c e and b i d p r i c e s . I t c a n be a r g u e d t h a t t h e s e f i g u r e s do n o t a d e q u a t e l y r e f l e c t t h e s o c i a l c o s t s a s s o c i a t e d w i t h h i g h w a y r e c o n s t r u c t i o n and m a i n t e n a n c e . S i n c e t h e e v a l u a t i o n o f a p u b l i c l y f u n d e d p r o j e c t r e q u i r e s an a c c o u n t i n g s y s t e m t h a t a c k n o w l e d g e s t r u e c o s t s a n d b e n e f i t s a c c r u e d by a s o c i e t y r a t h e r t h a n s i m p l y m a r k e t p r i c e s , m o d i f i c a t i o n s must be made a c c o r d i n g l y . To p r o p e r l y a s s e s s t h e s i t u a t i o n , a b r i e f d e s c r i p t i o n o f t h e t y p e of r e s o u r c e s consumed and t h e b i d d i n g p r o c e s s i s r e q u i r e d . H i s t o r i c a l l y , b i d s f o r A l a s k a H ighway r e c o n s t r u c t i o n a n d p a v i n g h a v e o r i g i n a t e d p r i m a r i l y f r o m B r i t i s h C o l u m b i a a n d A l b e r t a b u t t o some e x t e n t f r o m t h e o t h e r p r a i r i e p r o v i n c e s a n d O n t a r i o a n d Quebec as w e l l . 8 9 9 b a s e d on c o n v e r s a t i o n s w i t h PWC e m p l o y e e s 99 T h i s r e p o r t assumes t h a t , b e c a u s e o f t h e r e l a t i v e l y l o n g t i m e d u r a t i o n o f t h e p r o j e c t , b i d s w i l l be a t t r a c t e d f r o m t h r o u g h o u t Canada a nd i t i s t h e r e f o r e t h e C a n a d i a n r a t h e r t h a n t h e l o c a l l a b o u r m a r k e t w h i c h i s r e l e v a n t . C o n s t r u c t i o n c r e w s a r e o f t e n , b u t n o t e x c l u s i v e l y , u n i o n i z e d . 9 0 T h i s r e p o r t a s s u m e s t h a t l a b o u r r a t e s a r e g e n e r a l l y s e t by u n i o n a g r e e m e n t s . I n p u t s JJQto b o t h r e c o n s t r u c t i o n a n d m a i n t e n a n c e c a n be r o u g h l y b r o k e n down on a d o l l a r b a s i s a s f o l l o w s : MATERIALS 1/3 EQUIPMENT 1/3 LABOUR 1/3 A p p r o x i m a t e l y 80% o f t h e h i g h w a y c o n s t r u c t i o n e q u i p m e n t u s e d i n t h i s a r e a i s m a n u f a c t u r e d i n t h e U n i t e d S t a t e s . 9 2 T h e r e f o r e , w i t h t h e e x c e p t i o n o f p e r h a p s some a s p e c t s o f e q u i p m e n t m a i n t e n a n c e a n d r e p a i r , l i t t l e a d d i t i o n a l l a b o u r c a n be a s s o c i a t e d w i t h t h e e q u i p m e n t c o s t c o m p o n e n t . However much o f t h e m a t e r i a l r e q u i r e d t o r e c o n s t r u c t t h e A l a s k a H i g h w a y i s assumed t o o r i g i n a t e l o c a l l y . The p r o d u c t i o n a n d t r a n s p o r t a t i o n o f m a t e r i a l s s u c h a s c r u s h e d 9 0 b a s e d on c o n v e r s a t i o n s w i t h PWC e m p l o y e e s 9 1 CTS-UBC s t u d y ( e x h i b i t 47 - e s t i m a t e by B.C. H i g h w a y s D e p a r t m e n t ) a n d PWC m a i n t e n a n c e e x p e n d i t u r e a c c o u n t s , HIGHWAY MAINTENANCE INVENTORY AND BUDGET SUMMARY - F I S C A L YEAR 8 1 7 8 2 9 2 CTS S t u d y 100 r o c k a n d c u l v e r t s r e q u i r e s a s i g n i f i c a n t l a b o u r i n p u t . F o r t h e p u r p o s e s o f t h i s s t u d y , i t i s assumed t h a t t o t a l d i r e c t a n d i n d i r e c t C a n a d i a n l a b o u r i n p u t a s a p o r t i o n o f A l a s k a H i g h w a y r e c o n s t r u c t i o n a n d m a i n t e n a n c e c o s t s i s o n e - h a l f o f a l l e x p e n d i t u r e s . As w e l l , most o f t h e r e q u i r e d l a b o u r i s assumed t o be o f a s k i l l e d n a t u r e w i t h t h e b r e a k d o w n a s l i s t e d i n TABLE 3 - 8 9 3 . A l t h o u g h t h e a b o v e p e r c e n t a g e s a p p l y ***************** TABLE 3 - 8 ********************* T Y P I C A L LABOUR MIX IN HIGHWAY CONSTRUCTION PROJECTS LABOUR C L A S S I F I C A T I O N % OF TOTAL MAN HOURS ********************* ******************** S K I L L E D TRADESMEN 83 PROFESSIONAL 7 OTHER ; 10 ************************************************** s p e c i f i c a l l y t o h i g h w a y r e c o n s t r u c t i o n , m a i n t e n a n c e f o r c e s a l o n g t h e A l a s k a H i g h w a y a r e s i m i l a r i n t e r m s o f r e q u i r e d s k i l l l e v e l s . 9 " I n summary, l a b o u r c o m p r i s e s r o u g h l y o n e - h a l f o f t h e e x p e c t e d h i g h w a y r e c o n s t r u c t i o n c o s t s a n d a s s o c i a t e d m a i n t e n a n c e s a v i n g s . T h i s l a b o u r c o n s i s t s p r i m a r i l y o f 9 3 E s t i m a t e s p r o v i d e d by t h e B.C.Highways D e p a r t m e n t a s n o t e d i n t h e CTS s t u d y - E x h i b i t 48 9 " an A l a s k a H i g h w a y m a i n t e n a n c e c r e w ( b a s e d i n Yukon T e r r i t o r y ) t y p i c a l l y c o n s i s t s o f 1 f o r e m a n , 3 t o 4 o p e r a t o r s , a n d 1 l a b o u r e r - s o u r c e N.Munro, C o n t r a c t I n s p e c t o r , PWC 1 0 1 s k i l l e d t r a d e s m e n w i t h wages g e n e r a l l y c o n t r o l l e d by c o l l e c t i v e a g r e e m e n t s . S i n c e f r e e m a r k e t c o n d i t i o n s do n o t p r e v a i l , wages must be m o d i f i e d t o more c l o s e l y r e f l e c t t h e i r t r u e s o c i a l c o s t s . The g e o g r a p h i c a l s c o p e o f t h e l a b o u r m a r k e t i n c l u d e s a l l o f C a n a d a . A d j u s t m e n t s t o t h e c o s t c a t e g o r i e s l i s t e d i n s e c t i o n s 3.1 and 3.2 must be made t o r e f l e c t t h e f o l l o w i n g a n o m o l i e s : 1 . The c u r r e n t r e c e s s i o n h a s r e s u l t e d i n an a c c u m u l a t i o n o f u n e m p l o y e d o r u n d e r e m p l o y e d e q u i p m e n t . The s o c i a l c o s t o f u s i n g t h e s e r e s o u r c e s t o r e c o n s t r u c t t h e A l a s k a H i g h w a y w o u l d t h e r e f o r e be somewhat l e s s t h a n t h o s e i n d i c a t e d by h i s t o r i c b i d p r i c e s . I t i s e x p e c t e d t h e c o s t w o u l d l i e somewhere b e t w e e n t h e s h o r t r u n m a r g i n a l c o s t a n d f u l l y d i s t r i b u t e d c o s t o f u s i n g t h e e q u i p m e n t . An a n a l y s i s o f r e c e n t b i d p r i c e s e x p e r i e n c e d by v a r i o u s h i g h w a y d e p a r t m e n t s i n d i c a t e s t h a t c o n s t r u c t i o n c o m p a n i e s a r e now s e t t i n g l o w e r v a l u e s on t h e i r r e s o u r c e s . A l t h o u g h a c t u a l p e r c e n t a g e s were n o t g i v e n , PWC c o n t r a c t p e r s o n n e l c l a i m t h a t r e c e n t b i d p r i c e s f o r a v a r i e t y o f h i g h w a y p r o j e c t s h a v e d r o p p e d c o n s i d e r a b l y . F o r e x a m p l e one g r a v e l c r u s h i n g c o n t r a c t , e s t i m a t e d t o c o s t $ 1 , 6 0 0 , 0 0 0 b a s e d on h i s t o r i c a l b i d p r i c e s , a t t r a c t e d s e v e r a l b i d s b e l o w t h a t f i g u r e i n c l u d i n g one f o r $ 7 0 0 , 0 0 0 a n d one f o r $ 9 0 0 , 0 0 0 . I t i s t h e i r b e l i e f t h a t r e d u c e d b i d s a r e n o t a r e s u l t o f l o w e r wages b u t i n s t e a d a r e s u l t o f h i g h e r 1 02 p r o d u c t i o n r a t e s on t h e p a r t o f t h e c o n t r a c t o r . The B r i t i s h C o l u m b i a M i n i s t r y o f T r a n s p o r t a t i o n a n d H i g h w a y s a r e e x p e r i e n c i n g a s i m i l a r t r e n d , a s t h e f o l l o w i n g q u o t e i n d i c a t e s : 9 5 " I n g e n e r a l t e r m s , b i d d i n g on r e c e n t c o n s t r u c t i o n a n d p a v i n g c o n t r a c t s h a s been q u i t e k een a n d w i t h f a i r l y l a r g e numbers o f b i d d e r s a n d p r i c e s h a v e been c o m i n g i n somewhat l e s s t h a n m i n i s t r y e s t i m a t e s " I n t h e U n i t e d S t a t e s , f u l l y t w o - t h i r d s o f s t a t e h i g h w a y d e p a r t m e n t s saw a d e c l i n e i n a v e r a g e b i d p r i c e s d u r i n g t h e f i r s t q u a r t e r o f 1 9 8 1 9 6 . TABLE 3-9 i l l u s t r a t e s t h e e x t e n t t o w h i c h b i d s h a v e f a l l e n . ******** TABLE 3 _ 9 ************ DECLINE IN HIGHWAY CONSTRUCTION BID PRICES ( F I R S T QUARTER 1981) STATE %REDUCTION MONTANA 30.4 I L L I N O I S 15.4 NEVADA 16.2 ********************************* 2. Wages i n Canada have h i s t o r i c a l l y e s c a l a t e d a t a r a t e a b o v e t h a t o f g e n e r a l i n f l a t i o n , a t r e n d w h i c h h a s 9 5 R . J . B a i n e s - S e n i o r I n f o r m a t i o n O f f i c e r - B . C . M i n i s t r y o f T r a n s p o r t a t i o n a n d H i g h w a y s 9 6 ENGINEERING NEWS RECORD - JUNE 18/81 1 03 been made p o s s i b l e due t o r i s i n g p e r - c a p i t a p r o d u c t i o n f i g u r e s 9 7 . A p p e n d i x V l i s t s S t a t i s t i c s C anada d a t a i n d i c a t i n g i n c r e a s e s i n c o m p e n s a t i o n f o r v a r i o u s j o b c a t e g o r i e s b e t w e e n t h e y e a r s 1971 and 1982. I n c l u d e d a r e c o m p a r i s o n s o f t h e s e r a t e s w i t h t h e C a n a d i a n c o n s u m e r p r i c e i n d e x o v e r t h e same p e r i o d . T h r e e o f t h e c a t e g o r i e s p a r t i c u l a r l y r e l e v a n t t o t h i s s t u d y a r e a s l i s t e d i n TABLE 3-10. D u r i n g t h e same p e r i o d , ******************** TABLE 3 — 10 ************************* WAGE INCREASES RELATIVE TO C P l EMPLOYMENT CATEGORY ******************** AVERAGE ANNUAL INCREASE ( 1 9 7 1 - 1 9 8 2 ) *************** AVERAGE ANNUAL INCREASE RELATIVE TO C P l ****************** LABOURER 11.09% 2.18% HEAVY EQUIPMENT OPERATOR 10.86% 1.95% TRUCK DRIVER 10.74% 1.83% ******************************************************** a v e r a g e p r i c e s o f v a r i o u s t y p e s o f e q u i p m e n t w h i c h a r e t y p i c a l o f t h o s e u s e d i n h i g h w a y r e c o n s t u c t i o n p r o j e c t s have e s c a l a t e d a t a r a t e r o u g h l y e q u a l t o 9 7 L a b o u r p r o d u c t i v i t y i n B r i t a i n , f o r e x a m p l e , h a s h i s t o r i c a l l y e s c a l a t e d a t t h e r a t e o f 2% p e r annum. T h i s h a s p e r m i t t e d wages i n t h a t c o u n t r y t o r i s e by 2% p e r annum more t h a n p r i c e s . MACROECONOMICS - P a u l W o n n a c o t t - 1974 (page 259) 9 8 S T A T I S T I C S CANADA CATALOGUE 62-007 and 62-011 i n d i c a t e t h a t p r i c e s f o r m o t o r t r a n s p o r t e q u i p m e n t a nd t r u c k s o v e r 33,000 l b h a v e e s c a l a t e d a t a n n u a l r a t e s o f 8.12 a n d 9.91% r e s p e c t i v e l y c o m p a r e d w i t h 8.91% f o r t h e C P l 1 04 t h a t o f g e n e r a l i n f l a t i o n . 9 8 A s s u m i n g t h a t t o t a l c o n s t r u c t i o n a n d m a i n t e n a n c e c o s t s a r e o n e - h a l f l a b o u r r e l a t e d , and l a b o u r r a t e s w i l l c o n t i n u e t o i n c r e a s e a t 2% p e r annum on t h e a v e r a g e , c o n s t r u c t i o n c o s t s a n d m a i n t e n a n c e s a v i n g s a r e p r o j e c t e d t o i n c r e a s e 1% p e r annum i n r e a l t e r m s . 3. Unemployment r a t e s i n Canada f o r v a r i o u s l a b o u r c a t e g o r i e s a r e now s i g n i f i c a n t l y a b o v e any l e v e l e x p e r i e n c e d s i n c e t h e 1930's. Some o f t h e more r e l e v a n t d a t a a r e a s l i s t e d i n TABLE 3-11. I t i s c l e a r ******************* TABLE 3~11 *************************** CANADIAN UNEMPLOYMENT RATES IN SELECTED CATEGORIES 9 9 CANADA YEAR AVERAGE CONSTRUCTION TRANS.EQUIP.OPERATION 1977 8.2% 16.5% 9.7% 1981 8.0% NA NA DEC 1982 12.8% 2 3 . 0 % 14.0% MAY 1983 NA 2 1 . 0 % 12.0% ********************************************************** t h a t , a l t h o u g h c o n s t r u c t i o n w o r k e r s a r e o f t e n s u b j e c t e d t o l e v e l s o f unemployment somewhat ab o v e t h e a v e r a g e , c u r r e n t unemployment i s a p a r t i c u l a r l y s e v e r e p r o b l e m . U n l i k e c o n s t r u c t i o n e q u i p m e n t , l a b o u r i n t h i s c a s e i s n o t p r i c e d by t h e p u r e m a r k e t f o r c e s o f s u p p l y 9 9 S T A T I S T I C S CANADA c a t a l o g u e 71-001 105 a n d demand. The p r i c e o r wage i s g o v e r n e d i n s t e a d by c o l l e c t i v e a g r e e m e n t s a n d g e n e r a l l y d o e s n o t f l u c t u a t e , a t l e a s t i n t h e s h o r t r u n , t o r e f l e c t s h i f t s i n s u p p l y a n d demand. The s o c i a l c o s t o f l a b o u r i n t h i s c a s e i s n o t t h e p r e v a i l i n g g r o s s wage. I n s t e a d i t i s l a b o u r ' s o p p o r t u n i t y c o s t , o r t h e v a l u e o f l a b o u r i n i t s n e x t b e s t a l t e r n a t i v e u s e . I t s h o u l d be n o t e d t h a t , w i t h t h e e x c e p t i o n o f e x t r e m e c a s e s o f u n e m p l o y m e n t , t h e d i v e r g e n c e b e t w e e n shadow an d m a r k e t p r i c e s o f l a b o u r have r a r e l y been a l l o w e d f o r i n p r o j e c t a p p r a i s a l . 1 0 0 Thus e x a m p l e s f r o m w h i c h e x p e r i e n c e c a n be g a t h e r e d a r e r a r e . A s t a n d a r d p r a c t i s e i n a p p r a i s i n g p r o j e c t s o f d e v e l o p i n g c o u n t r i e s w i t h w i d e s p r e a d unemployment and m i n i m a l i n c o m e s i s t o v a l u e l a b o u r a t z e r o d o l l a r s . However t h i s i s o f t e n c r i t i c i z e d on t h e b a s i s t h a t t h e l o s s o f l e i s u r e o r d i s u t i l i t y o f i n c r e a s e d e f f o r t r e p r e s e n t s some c o s t . T h e r e i s c o n s i d e r a b l e e v i d e n c e t h a t a s an a b s o l u t e minimum, u n e m p l o y e d l a b o u r c a n n o t be t e m p t e d i n t o employment b e l o w a s u b s i s t e n c e d a i l y wage o f an e q u i v i l e n t o f 3 k i l o g r a m s o f g r a i n . 1 0 1 One a p p r o a c h t o v a l u a t i n g a h i g h w a y p r o j e c t i n West M a l a y s i a ( S u d h i r A n a n d 1976) was t o p r i c e l a b o u r a t i t s m a r g i n a l 1 0 0 THE SOCIAL APPRAISAL OF PROJECTS D.W.Pearce and C.A.Nash -1981 - ( p a g e 109) 1 0 1 ECONOMIC ANALYSIS OF PROJECTS S q u i r e a n d Van d e r Tak - 1975 (page 79) 106 p r o d u c t i n a g r i c u l t u r e p l u s an a d j u s t m e n t f o r e x t r a f o o d a n d t r a n s p o r t a t i o n . 1 0 2 T h i s p r i c e a mounted t o o n e - h a l f o f t h e wage t h a t was a c t u a l l y p a i d . L e i s u r e t i m e s a v i n g s were assumed t o h a v e no v a l u e i n t h i s c a s e . Of c o u r s e Canada i s n o t t e r m e d a " d e v e l o p i n g c o u n t r y " a n d l e i s u r e t i m e a n d e f f o r t a r e somewhat more d i f f i c u l t t o shadow p r i c e . FIGURE 3-1 p r o v i d e s a f o r m u l a d e v e l o p e d by S q u i r e and Van d e r Tak (1975 p.83) t h a t i s w o r t h y o f u s e a s an e x a m p l e f r o m a t h e o r t i c a l p e r s p e c t i v e . U n f o r t u n a t e l y some o f t h e f a c t o r s i n c o r p o r a t e d i n t h i s f o r m u l a a r e unknown and e s t i m a t e s c a n o n l y be made a r b i t r a r i l y . To a p p l y s u c h an e q u a t i o n t o t h e c a s e o f t h e A l a s k a H i g h w a y w o u l d n o t be i m p o s s i b l e b u t t o do so w i t h e x p e c t a t i o n s o f r e a s o n a b l e r e s u l t s w o u l d r e q u i r e s u b s t a n t i a l l y more p r i m a r y r e s e a r c h t h a n t h a t w h i c h i s a v a i l a b l e t o d a y . T h i s s t u d y i s f o r c e d t o t a k e a somewhat more s i m p l i s t i c , y e t r a t i o n a l , a p p r o a c h t o t h e p r o b l e m . F i r s t , w i t h unemployment l e v e l s a b o v e 20% i n t h e c o n s t r u c t i o n s e c t o r , i t i s assumed t h a t much o f t h e l a b o u r consumed i n y e a r one o f t h e p r o j e c t w o u l d be o t h e r w i s e u n e m p l o y e d . 1 0 3 S e c o n d , a t t h e m a r g i n , l e i s u r e w o u l d be v a l u e d somewhere b e t w e e n o n e - t h i r d 1 0 2 THE SOCIAL APPRAISAL OF PROJECTS - D.W.Pearce a n d C.A.Nash -1981 (page 188) 1 07 SWR SHADOW WAGE RATE MR + (W-M)(B-D/V) + (W-M)PeD/V LABOUR'S FOREGONE MARGINAL PRODUCT AT ACCOUNTING PRICES NET SOCIAL COST OF INCREASED CONSUMPTION SOCIAL COST OF REDUCED LEISURE WHERE: M= MARGINAL PRODUCT IN ALTERNATIVE EMPLOYMENT R= ACCOUNTING RATIO TO ARRIVE AT OUTPUT ACTUALLY FORGONE W= WAGE IN NEW JOB B= CONSUMPTION CONVERSION FACTOR = COST OF REDUCTION IN PUBLIC INCOME MEASURED IN FOREIGN EXCHANGE D/V= SOCIAL BENEFIT OF ADDITIONAL CONSUMPTION IN THE PRIVATE SECTOR P= RATIO OF THE SOCIAL COST TO THE PRIVATE EVALUATION OF THE DISUTILITY OF EFFORT e= RATIO OF THE WAGE EARNER'S OWN EVALUATION OF THE DISUTILITY OF EFFORT TO HIS ADDITIONAL INCOME **** FIGURE 3-1 **** THEORETICAL FORMULA FOR ESTABLISHING SHADOW WAGE RATES and two-thirds of the gross wage package. One-third of the gross wage approximates unemployment insurance b e n e f i t s whereas two-thirds approximates the net-of-tax compensation a c t u a l l y received as a r e s u l t of being employed at the p r e v a i l i n g wage. See Chapter 4 1 08 f o r a d d i t i o n a l d i s c u s s i o n s r e l a t e d t o l a b o u r shadow p r i c i n g . E a c h o f t h e t h r e e a n o m o l i e s d i s c u s s e d p r e v i o u s l y a r e c o n s i d e r e d o f s u f f i c i e n t i m p o r t a n c e t o j u s t i f y a c o r r e s p o n d i n g m o d i f i c a t i o n o f t h e c o s t s a n d s a v i n g s d e s c r i b e d i n s e c t i o n s 3.1 and 3.2. The f o l l o w i n g a s s u m p t i o n s have been made: 1. The r e c e s s i o n i n C a nada h a s p e a k e d i n t e r m s o f l e v e l s o f unemployment b o t h f o r l a b o u r a n d e q u i p m e n t . Demand f o r t h e s e r e s o u r c e s w i l l i n c r e a s e g r a d u a l l y b u t c o n t i n u o u s l y o v e r a f o u r y e a r p e r i o d . A t t h e end o f f o u r y e a r s , t h e s o c i a l c o s t o f l a b o u r w i l l be e q u a l t o p r e v a i l i n g wage r a t e s a n d c o n t r a c t o r s w i l l v a l u e e q u i p m e n t a t i t s f u l l y d i s t r i b u t e c o s t when s u b m i t t i n g b i d s . 2. The s o c i a l c o s t o f l a b o u r a s a p e r c e n t a g e o f wages p a i d a r e a s l i s t e d i n TABLE 3-12. 1 0 3 A l t h o u g h some o f t h e e m p l o y e e s may have t h e o p p o r t u n i t y o f w o r k i n g e l s e w h e r e , t o do so w o u l d d i s p l a c e o t h e r p r o s p e c t i v e w o r k e r s who w o u l d t h e n be t h e m s e l v e s u n e m p l o y e d . I t i s assumed p r o j e c t e m p l o y e d l a b o u r w i l l be a t t r a c t e d f r o m t h e r a n k s o f t h e u n e m p l o y e d r a t h e r t h a n f r o m o t h e r c o n s t r u c t i o n p r o j e c t s . 109 ************** TABLE 3—12 *********** ESTIMATED SHADOW LABOUR COSTS YEAR % OF ACTUAL WAGE COST **** ********************* 1984 50 1985 62.5 1986 75 1987 87.5 BEYOND 1987 100.0 ************************************ P r o j e c t e d a c t u a l c o n s t r u c t i o n c o s t s ( b i d s ) a s a p e r c e n t a g e o f h i s t o r i c e s t i m a t e s d e s c r i b e d i n s e c t i o n 3.1 a r e l i s t e d i n TABLE 3-13. **************** TABLE 3~13 ************ PROJECTED BID PRICES YEAR % OF HISTORICAL COSTS **** ********************* 1984 80 1985 85 1986 90 1987 95 BEYOND 1987 100 **************************************** A l l c o s t s w i l l e s c a l a t e i n r e a l t e r m s a t an a n n u a l r a t e o f 1% t o r e f l e c t h i s t o r i c r i s e s i n wage r a t e s r e l a t i v e t o g e n e r a l i n f l a t i o n . R e c o n s t r u c t i o n o f h i g h w a y c o m p o n e n t s i n c l u d i n g d r a i n a g e d i t c h e s , c u l v e r t s , a n d some o f t h e r o a d b e d i t s e l f , i s g e n e r a l l y r e q u i r e d a f t e r a p e r i o d o f 40-50 y e a r s . As d i s c u s s e d i n p a g e s 93-94, c o n s u m p t i o n o f r e s o u r c e s t o r e b u i l d t h e A l a s k a H i g h w a y i n y e a r 2024 1 10 s h o u l d be somewhat l e s s t h a n t h a t of o r i g i n a l c o n s t r u c t i o n . S i n c e t h e s t u d y t i m e h o r i z o n i s 20 y e a r s , y e t t h e o r i g i n a l i n v e s t m e n t w i l l c o n t i n u e t o p r o v i d e r e t u r n s i n t h e f o r m of u s e r s a v i n g s a n d r e d u c e d h i g h w a y m a i n t e n a n c e f o r a t l e a s t a n o t h e r 20 y e a r s b e f o r e any r e b u i l d i n g i s r e q u i r e d , i t i s n e c e s s a r y t o e s t a b l i s h a r e s i d u a l v a l u e f o r t h e h i g h w a y a t t h e end o f 20 y e a r s ( 2 0 0 3 ) . U s i n g a r e s i d u a l v a l u e i s e s s e n t i a l l y an a t t e m p t t o c a p t u r e i n v e s t m e n t r e l a t e d b e n e f i t s w h i c h a c c r u e b e y o n d t h e y e a r 2003 b u t have been e f f e c t i v e l y d e l e t e d b e c a u s e o f t h e l i m i t e d t i m e h o r i z o n . I t i s a c o n v e n i e n t , y e t a p p r o x i m a t e , a l t e r n a t i v e t o u s i n g a s t u d y t i m e p e r i o d of s u f f i c i e n t l e n g t h s u c h t h a t a l l i n v e s t m e n t - r e l a t e d b e n e f i t s h a v e been c a p t u r e d . A f i g u r e o f 60% o f t h e o r i g i n a l i n v e s t m e n t , i n f l a t e d t o a c c o u n t f o r i n c r e a s i n g c o n s t r u c t i o n c o s t s i n r e a l t e r m s by a f a c t o r o f 1 . 0 1 2 0 = 1.22, w i l l be u s e d a s a b a s e e s t i m a t e f o r h i g h w a y r e s i d u a l v a l u e i n 2003. T h i s i s s u b j e c t t o h i g h l e v e l s o f u n c e r t a i n t y and w i l l be e x a m i n e d i n t h e s e n s i t i v i t y a n a l y s i s p r o v i d e d i n C h a p t e r 8. The s t r e a m o f c o s t s and b e n e f i t s t o y e a r 2 0 0 3 , r e f l e c t i n g b o t h c o n s t r u c t i o n and m a i n t e n a n c e s a v i n g s , i s a s l i s t e d i n TABLE 3-14. The a b o v e d e s c r i b e d m o d i f i c a t i o n s a r e n o t 111 ************************* TABLE 3 —14 **************************** SUMMARY OF SHADOW-PRICED RECONSTRUCTION COSTS AND MAINT. SAVING 0 0 0 , 0 0 0 , 0 0 0 ' s d o l l a r s ( 1 9 8 4) YEAR * * * * 1 984 1985 1986 1.987 1988 1 989 1990 I 2003 2003 ORIGINAL RECONSTRUCTION ************** 5 4 1 ( 1 / 6 ) ( . 8 ) ( . 7 5 0 0 ) x 1.00 = 54.1 5 4 1 ( 1 / 6 ) ( . 8 5 ) ( . 8 1 2 5 ) x 1.01 = 6 2 . 9 5 4 1 ( 1 / 6 ) ( . 9 0 ) ( . 8 7 5 0 ) x 1.02 = 7 2 . 4 5 4 1 ( 1 / 6 ) ( . 9 5 ) ( . 9 3 5 0 ) x 1.03 = 8 2 . 5 5 4 1 ( 1 / 6 ) ( 1 . 0 0 ) x 1.04 = 9 3 . 8 5 4 1 ( 1 / 6 ) ( 1 . 0 0 ) x 1 .05 = 94.7 MAINTENANCE SAVINGS *********** 1 . 9 ( 1 / 6 ) ( . 7 5 0 0 ) x 1.00 = 1.48 1 . 9 ( 1 / 3 ) ( . 8 1 2 5 ) x 1.01 = 3.23 1 . 9 ( 1 / 2 ) ( . 8 7 5 0 ) x 1 .02 = 5.35 1 . 9 ( 2 / 3 ) ( . 9 3 5 0 ) x 1 .03 = 7.65 1 . 9 ( 5 / 6 ) ( 1 . 0 0 ) x 1 .04 = 10.3 1 . 9 ( 1 ) ( 1 . 0 0 ) x 1.05 = 12.5 n = 20 n ] T 1 1 . 9 ( 1 . 0 1 ) n = 6 FUTURE PAVING AND RESIDUAL VALUE ***************** 20 PAVING *- 5 7 0 0 0 ( 1 . 2 7 ) 0 .01) x 1178 km = 104. 0 RESIDUAL V A L U E — 541 ( .6) (1 .22) = 396 ***************************************************************** c o n v e n t i o n a l p r a c t i s e i n t h e e v a l u a t i o n o f h i g h w a y p r o j e c t s i n d e v e l o p e d c o u n t r i e s . However t h e i m p a c t o f shadow-p r i c i n g on t o t a l p r o j e c t c o s t s i s s u b s t a n t i a l . An a t t e m p t h a s been made t o k e e p t h e s e m o d i f i c a t i o n s somewhat on t h e c o n s e r v a t i v e s i d e . They w i l l be s u b j e c t t o s e n s i t i v i t y a n a l y s i s l a t e r i n t h i s r e p o r t . 1 1 2 • •• CHAPTER 4 ••• PRICING OF HIGHWAY USER RESOURCES D i r e c t s a v i n g s w h i c h a c c r u e t o v e h i c l e s a n d o c c u p a n t s t r a v e l l i n g t h e i m p r o v e d h i g h w a y r e p r e s e n t , w i t h r a r e e x c e p t i o n s , t h e m a j o r p r o p o r t i o n o f t o t a l p r o j e c t r e l a t e d b e n e f i t s . The v a l i d i t y o f f i n a l c o n c l u s i o n s i s t h e r e f o r e v e r y s e n s i t i v e t o t h e a c c u r a c y o f t h e a n a l y s t ' s e s t i m a t e o f t o t a l u s e r s a v i n g s . T h i s i s i n t u r n d e t e r m i n e d b y : The o b j e c t i v e o f t h i s c h a p t e r i s t o p r e s e n t t h e t h e o r i e s a n d m e t h o d o l o g i e s r e l e v a n t t o e s t a b l i s h i n g 2 a n d 3 a b o v e . T h e s e a r e t h e n u s e d t o a t t a c h s o c i a l v a l u e s t o r e s o u r c e s whose c o n s u m p t i o n i s e x p e c t e d t o be i n f l u e n c e d by r e c o n s t r u c t i o n o f t h e A l a s k a H i g h w a y . • • 4 . 1 SHADOW PRICING: A shadow p r i c e i s d e f i n e d a s t h e m a r g i n a l s o c i a l o p p o r t u n i t y c o s t o f a r e s o u r c e , o r t h e b e n e f i t s f o r g o n e by t h e l o s s o f one a d d i t i o n a l u n i t o f a s p e c i f i c r e s o u r c e . M a r k e t p r i c e s a r e o f t e n i n a p p r o p r i a t e m e a s u r e s o f o p p o r t u n i t y c o s t s o r shadow p r i c e s . They a r e o f t e n d i s t o r t e d by t h e p r e s e n c e o f 1 . How p r e c i s e h i s e s t i m a t e s a r e o f t h e q u a n t i t y o f e a c h r e s o u r c e s a v e d a r e {as d i s c u s s e d i n c h a p t e r 6} 2. The v a l i d i t i e s o f t h e shadow p r i c e s e s t a b l i s h e d f o r e a c h r e s o u r c e 3. The v a l i d i t y o f t h e c h o i c e o f d i s c o u n t r a t e a p p l i e d t o c o n v e r t a l l u s e r b e n e f i t s t o p r e s e n t v a l u e s 1 1 3 taxes and s u b s i d i e s of various d e s c r i p t i o n . These u s u a l l y represent t r a n s f e r payments only and must be i s o l a t e d and removed as a f i r s t step i n determining a shadow p r i c e . A l s o , p r i c e s and/or the q u a n t i t y s u p p l i e d of a commodity are often constrained by trade unions, marketing boards, governments, and other f o r c e s . Market p r i c e s i n these s i t u a t i o n s may deviate from those which would otherwise e x i s t i f the markets were f r e e . The process of shadow p r i c i n g i s e s p e c i a l l y d i f f i c u l t when a defined market i s non-existant for a p a r t i c u l a r resource. L e i s u r e time and saving l i v e s , for example, are resources which are not e x p l i c i t l y traded on any market. Shadow p r i c e s i n these cases must be estimated by imprecise techniques, such as behavioural analys i s. This s e c t i o n addresses the v a l u a t i o n of seven cost c a t e g o r i e s , i n c l u d i n g : 1. Time - commercial - personal 2. Accidents - f a t a l - i n j u r y - property 3. V e h i c l e d e p r e c i a t i o n 4. Fuel 5. T i r e s 6. Maintenance 7. Comfort 1 1 4 • 4.1.1 THE ECONOMIC VALUE OF TIME: A h i g h w a y r e c o n s t r u c t i o n p r o j e c t o f f e r s t i m e s a v i n g s t o u s e r s a s a r e s u l t o f two f a c t o r s , t h o s e b e i n g : - a r e d u c t i o n i n t h e o v e r a l l d i s t a n c e b e t w e e n o r i g i n a n d d e s t i n a t i o n due t o , f o r e x a m p l e , t h e r e l o c a t i o n o f one o r more h i g h w a y s e c t i o n s - i n c r e a s e d d e s i g n s p e e d due t o an i m p r o v e d s u r f a c e , r e d u c t i o n i n v e r t i c a l a n d h o r i z o n t a l c u r v a t u r e , w i d e r l a n e s , e t c . T r a v e l l i n g t i m e c o s t s a r e composed o f two c o m p o n e n t s , an e c o n o m i c c o s t , a n d d i s u t i l i t y a s s o c i a t e d w i t h v a r i o u s a s p e c t s o f t r a v e l l i n g , s u c h a s : 1 0 " - p h y s i c a l d i s c o m f o r t due t o m o t i o n - d r i v i n g e f f o r t - p e r c e i v e d r i s k o f p e r s o n a l i n j u r y - p e r c e i v e d r i s k o f v e h i c u l a r damage T h i s s e c t i o n l i m i t s d i s c u s s i o n t o t h e e c o n o m i c v a l u e o f t i m e s a v e d . The d i s u t i l i t y a s p e c t i s r e s e r v e d f o r s e c t i o n 4.1.2. The s o c i a l o p p o r t u n i t y c o s t o f t i m e , o r more c o r r e c t l y t h e v a l u e o f t i m e s a v e d , i s a v a r i a b l e w h i c h d i f f e r s 1 0 " ECONOMICS OF ROAD DESIGN STANDARDS - VOLUME 2 - 1980 - B u r e a u o f T r a n s p o r t E c o n o m i c s rp~. 221) 1 1 5 s i g n i f i c a n t l y among u s e r s . A m a j o r d e t e r m i n a n t i s o f t e n t r i p p u r p o s e . T r a f f i c c o u l d , i n t h e o r y , be d i s a g g r e g a t e d t o t h e p o i n t where a u n i q u e v a l u e o f t i m e i s d e t e r m i n e d f o r e a c h v e h i c l e , a f t e r f i r s t e s t a b l i s h i n g i t s s p e c i f i c c h a r a c t e r i s t i c s . However a more p r a c t i c a l a p p r o a c h i s t o s i m p l y c a t e g o r i z e v e h i c l e s by w h e t h e r t h e y a r e t r a v e l l i n g f o r p e r s o n a l o r c o m m e r c i a l p u r p o s e s . An a v e r a g e v a l u e o f t i m e i s t h e n e s t a b l i s h e d f o r e a c h c l a s s i f i c a t i o n . 4.1.1.1 ECONOMIC VALUE OF COMMERCIAL TRAVEL TIME: The f i r s t s t e p i n e s t a b l i s h i n g a shadow p r i c e f o r c o m m e r c i a l t i m e i s t o d e t e r m i n e i t s v a l u e o f m a r g i n a l p r o d u c t i o n . T h i s f i g u r e i s t h e maximum t h a t a b u y e r w o u l d be w i l l i n g t o pay f o r t h e m a r g i n a l p r o d u c t i o n g e n e r a t e d by one a d d i t i o n a l u n i t o f t i m e . I t i s o n l y r e a l l y v a l i d i n an e n v i r o n m e n t o f f u l l o r c l o s e t o f u l l employment f o r t h a t c a t e g o r y o f w o r k e r s . The l o w e r l i m i t f o r t h e v a l u e o f c o m m e r c i a l t i m e w o u l d be t h a t d e t e r m i n e d by t h e s u p p l y s i d e , t h a t i s , t h e w o r k e r h i m s e l f . He w o u l d o n l y be w i l l i n g t o work i f t h e c o r r e s p o n d i n g wage i s a d e q u a t e t o c o m p e n s a t e h i m f o r h i s l o s s o f l e i s u r e t i m e and t h e d i s u t i l i t y he a s s o c i a t e s w i t h h i s s p e c i f i c c a t e g o r y o f e m p l o y m e n t . 1 1 6 Thus t h e shadow p r i c e p o s s i b i l i t i e s f o r c o m m e r c i a l t i m e r a n g e a s f o l l o w s : V d > W < VMP( 1+t) w h e r e : Vd = d i s u t i l i t y o f e f f o r t f o r t h a t c a t e g o r y o f employment VMP = v a l u e o f m a r g i n a l p r o d u c t t = t h e t a x r a t e a p p l i e d t o t h e o u t p u t S i n c e t r a n s p o r t a t i o n s e r v i c e s a r e r a r e l y t a x e d e x p l i c i t l y , o r a t l e a s t t a x a t i o n i s s m a l l c o m p a r e d w i t h t o t a l r e v e n u e , t h e maximum p o s s i b l e shadow p r i c e c a n be s i m p l i f i e d t o j u s t VMP. I n f r e e m a r k e t s i t u a t i o n s , t h i s p r i c e i s a p p r o x i m a t e d by t h e p r e v a i l i n g wage r a t e . I n e c o n o m i e s c h a r a c t e r i z e d by h i g h l e v e l s o f u n e m p l o y m e n t , a w o r k e r ' s o p p o r t u n i t y c o s t may be much l e s s t h a n t h i s maximum a n d a t some p o i n t r e a c h e s V . T h i s i s due t o t h e f a c t t h a t , a s t h e r a t e o f unemployment i n c r e a s e s , t h e p r o b a b i l i t y t h a t a m a r g i n a l w o r k e r w o u l d be a b l e t o c o n v e r t any r e l e a s e d t i m e i n t o a c t u a l p r o d u c t i o n a p p r o a c h e s z e r o . F o r e x a m p l e , i n an economy w i t h a p r e v a i l i n g u nemployment r a t e f o r t r u c k d r i v e r s o f 2 5 % , i t i s e x t r e m e l y u n l i k e y t h a t a d r i v e r , i f r e l e a s e d by one f i r m , w o u l d be a b l e t o l o c a t e an a l t e r n a t i v e j o b w i t h o u t d i s p l a c i n g a n o t h e r w o r k e r . S i n c e he w o u l d be u n a b l e t o u s e h i s f r e e d - u p t i m e i n a p r o d u c t i v e manner, t h e o p p o r t u n i t y c o s t o f h i s t i m e becomes 1 1 7 o n l y t h e v a l u e he p l a c e s on n o t w o r k i n g , o r V A d j u s t i n g f o r u n e m p l o y m e n t , t h e shadow p r i c e o f l a b o u r i s t h e r e f o r e t h e g r e a t e r o f : W;j = VMP ( 1-(U%;j - 3 ) / 2 5 ) a n d : W,j = V w h e r e : W ;j i s t h e shadow p r i c e o f c o m m e r c i a l t i m e i n employment c a t e g o r y j i n y e a r i VMP i s t h e v a l u e o f m a r g i n a l p r o d u c t U%,j i s p e r c e n t unemployment i n employment c a t e g o r y j i n y e a r i 3 i s t o a d j u s t f o r t h e f a c t t h a t i n t i m e s o f " f u l l e m p l o y m e n t " , t h e s t a t e d unemployment r a t e w i l l be a p p r o x i m a t e l y 3% due t o w o r k e r s e n t e r i n g , e x i t i n g , a n d c h a n g i n g p o s i t i o n s w i t h i n t h e j o b m a r k e t 25 - assumes t h a t t h e v a l u e o f an i n d i v i d u a l ' s p o t e n t i a l p r o d u c t i o n c a p a b i l i t y i s v i r t u a l l y $0 when t h e p e r c e n t a g e o f p e r s o n s u n e m p l o y e d r e a c h e s t h e m i d 20's ( n o t e t h a t t h i s i s my e s t i m a t e o n l y a nd i s n o t e m p i r i c a l l y o r t h e o r e t i c a l l y d e r i v e d ) Time I n d i v i s i b i l i t y : The e q u a t i o n a b o v e i m p l i c i t l y assumes t h a t i n d i v i d u a l u n i t s o f t i m e s a v i n g s a r e o f s u f f i c i e n t m a g n i t u d e t o be r e a s o n a b l y c o n v e r t a b l e i n t o a l t e r n a t i v e u s e s . T h i s i s n o t a l w a y s t h e c a s e . F o r e x a m p l e , t o t a l t i m e s a v i n g s o f 10,000 h o u r s / a n n u m may be o f 1 18 l i t t l e o r no v a l u e i f i t i s composed o f one m i l l i o n u n i t s o f 36 s e c o n d s e a c h . E a c h i m p r o v e m e n t p r o g r a m i s u n i q u e a s a r e t h e f o r m and m a g n i t u d e o f i t s r e s u l t i n g t i m e s a v i n g s . T h e r e may be some s i t u a t i o n s i n w h i c h a c o n s i d e r a b l e v o l u m e o f l o c a l i z e d f r e i g h t t r a f f i c a c c r u e s c o n s i d e r a b l e t i m e s a v i n g s i n t o t a l y e t , i n d i v i d u a l l y , t h e u n i t s o f t i m e s a v i n g s a r e n e g l i g i b l e a n d o f no r e a l v a l u e . T h e s e " f a l s e " t i m e s a v i n g s must be i s o l a t e d a n d e x c l u d e d f r o m t h e a n a l y s i s . I t i s l i k e l y , h o w e v e r , t h a t i n t h e c a s e o f A l a s k a H i g h w a y r e c o n s t r u c t i o n , t h e r e s u l t i n g o r i g i n - d e s t i n a t i o n d i s t a n c e r e d u c t i o n s a n d / o r i n c r e a s e d d e s i g n s p e e d w o u l d be o f m a g n i t u d e s t h a t do g e n e r a t e t i m e s a v i n g s w h i c h a r e , t o a l a r g e e x t e n t , c o n v e r t a b l e t o p r o d u c t i v e u s e s . VMP - N e t o r G r o s s Wage?: The v a l u e o f m a r g i n a l p r o d u c t i s e q u a l i n t o t h e l o n g r u n m a r g i n a l c o s t o f l a b o u r , o r t h e g r o s s wage r a t e . Use o f t h e n e t h o u r l y wage t o a s s e s s t h e v a l u e o f c o m m e r c i a l t i m e u n d e r - e s t i m a t e s t h a t v a l u e by a n o n - t r i v i a l amount. F r i n g e b e n e f i t p a c k a g e s o f t e n i n c l u d e m e d i c a l a n d d e n t a l p r e m i u m s , v a c a t i o n p a y , p e n s i o n and w o r k e r ' s c o m p e n s a t i o n b o a r d c o n t r i b u t i o n s , e t c . a n d r e p r e s e n t 1 19 s u b s t a n t i a l c o s t s w h i c h must be a b s o r b e d by t h e e m p l o y e r . I n C a n a d a , t o t a l c o m p e n s a t i o n i n t h e t r a n s p o r t a t i o n s e c t o r a s a p r o p o r t i o n o f b a s e pay i s 1.417 1 0 5 . I n summary, t o a c c u r a t e l y a s s e s s t h e v a l u e o f c o m m e r c i a l t r a v e l l i n g t i m e , t h e a n a l y s t m u s t : 1. D e t e r m i n e t h e number o f v e h i c l e h o u r s s a v e d t h a t c o u l d be c l a s s i f i e d a s c o m m e r c i a l t i m e ( a s c a l c u l a t e d i n C h a p t e r 6) 2. D e t e r m i n e t h e number o f p a i d e m p l o y e e s p e r v e h i c l e ( t y p i c a l l y t h i s w o u l d be 1 ) 3. I s o l a t e t h o s e t i m e s a v i n g s w h i c h c o u l d r e a s o n a b l y be a s s u m e d v a l u e l e s s b e c a u s e o f t h e i r n e g l i g i b l e m a g n i t u d e s a n d remove them f r o m t h e a n a l y s i s 4. C a l c u l a t e a w e i g h t e d a v e r a g e n e t wage f o r c o m m e r c i a l d r i v e r s 1 0 6 5. D e t e r m i n e t h e e m p l o y e e ' s g r o s s c o m p e n s a t i o n a s a p r o p o r t i o n o f b a s e pay ( a s p r e v i o u s l y s t a t e d , t h e f i g u r e o f 1.4 i s a p p l i c a b l e t o t h e t r a n s p o r t s e c t o r i n C anada a n d w i l l be u s e d i n t h i s s t u d y ) 6. D e t e r m i n e t h e r a t e o f unemployment f o r c o m m e r c i a l d r i v e r s i n t h e s t u d y a r e a 7. I f unemployment i s h i g h , t h e a n a l y s t s h o u l d a t t e m p t t o d e r i v e a v a l u e f o r t h e d i s u t i l i t y o f e f f o r t a s s o c i a t e d w i t h d r i v i n g c o m m e r c i a l v e h i c l e s i n t h e s t u d y a r e a . I n p r a c t i s e , t h i s 1 0 5 f r o m W.D.Wood e t a l - C u r r e n t I n d u s t r i a l R e l a t i o n s S c e n e i n  C a nada 1 0 6 wages c a n be d e t e r m i n e d by d i r e c t c o n t a c t w i t h t r u c k i n g f i r m s i n t h e s t u d y a r e a a n d / o r by r e v i e w i n g p u b l i c a t i o n s s u c h a s B.C. L a b o u r R e s e a r c h B u l l e t i n s w h i c h p r o v i d e d e t a i l s o f c u r r e n t c o l l e c t i v e a g r e e m e n t s 1 20 may be d i f f i c u l t t o a c c o m p l i s h , a n d a v a l u e o f f r o m o n e - t h i r d t o o n e - h a l f o f t h e n e t wage may be u s e d f o r s i m p l i c i t y . The t o t a l b e n e f i t t o s o c i e t y r e s u l t i n g f r o m p r o j e c t g e n e r a t e d c o m m e r c i a l t i m e s a v i n g s i s c a l c u l a t e d a s f o l l o w s : TOTAL DISCOUNTED 20 -n BENEFIT = ( H> x N ) ( g r e a t e r o f : VMP (1 - ( U % - 3 ) / 2 5 ) ) ( 1 + r ) OF n=1 -n COMMERCIAL " a n d : V ( l + r ) TIME SAVINGS w h e r e : VMP = t h e w e i g h t e d a v e r a g e wage r a t e t i m e s t h e f r i n g e b e n e f i t g r o s s - u p f a c t o r U%„= t h e r a t e o f unemployment i n y e a r n i n t h e s t u d y a r e a f o r t h e r e l e v a n t e mployment c a t e g o r y V = t h e d i s u t i l i t y o f e f f o r t f o r t h e r e l e v a n t employment c a t e g o r y N = t h e number o f e m p l o y e e s p e r c o m m e r c i a l v e h i c l e H ;= t h e t o t a l number o f c o m m e r c i a l v e h i c l e v e h i c l e h o u r s s a v e d i n y e a r i t h a t a r e assumed c o n v e r t a b l e t o a l t e r n a t i v e u s e s P r e d i c t i o n o f W i n F u t u r e Y e a r s : I t i s u s u a l l y s a f e t o assume t h a t t h e v a r i a b l e s D, N, and t h e f r i n g e b e n e f i t g r o s s - u p f a c t o r w i l l n o t c h a n g e 121 s u b s t a n t i a l l y i n f u t u r e y e a r s . However i t c a n n o t be assumed t h a t t h e unemployment r a t e a n d wage i n r e a l t e r m s w i l l c o n t i n u e a t l e v e l s e x i s t i n g i n y e a r z e r o . An e f f o r t s h o u l d be made t o p r e d i c t f u t u r e v a l u e s f o r t h e s e v a r i a b l e s e v e n t h o u g h i t must be a c c e p t e d t h a t any p r e d i c t i o n w o u l d be c h a r a c t e r i z e d by a h i g h d e g r e e o f u n c e r t a i n t y . I n a g r o w i n g economy, wages g e n e r a l l y e s c a l a t e a t a r a t e somewhat a b o v e t h a t o f i n f l a t i o n . A s i m p l e method o f p r e d i c t i n g f u t u r e wages i n r e a l t e r m s w o u l d t h e r e f o r e be t o e x a m i n e t h e h i s t o r i c g r o w t h o f wages r e l a t i v e t o t h e CPI and t o assume t h i s r e l a t i o n s h i p w i l l c o n t i n u e t o h o l d i n f u t u r e y e a r s . Wages w o u l d be e s c a l a t e d a t t h e r a t e o f i p e r y e a r , w i t h i d e t e r m i n e d a s f o l l o w s : n (1 + i ) = (w /W ) / ( C P I /CPI ) -n -n T h i s i s a d m i t t e d l y a c r u d e t e c h n i q u e y e t b e t t e r t h a n s i m p l y a s s u m i n g t h e wage r a t e t o r e m a i n c o n s t a n t a n d p r o b a b l y a d e q u a t e g i v e n t h e o v e r a l l l e v e l o f u n c e r t a i n t y i n h e r e n t i n a b e n e f i t / c o s t a n a l y i s s u c h a s t h i s . 1 22 V a l u e s To Be A p p l i e d I n T h i s S t u d y Shadow p r i c e s f o r c o m m e r c i a l t i m e s a v i n g s , s p e c i f i c t o t h i s s t u d y , a r e b a s e d on t h e f o l l o w i n g f a c t s a n d a s s u m p t i o n s : 1. F o r t h r o u g h c o m m e r c i a l t r a f f i c , o p e r a t i o n s c a n r a t i o n a l i z e d f a i r l y e f f i c i e n t l y s u c h t h a t one h o u r o f t i m e s a v i n g s due t o h i g h w a y r e c o n s t r u c t i o n t r a n s l a t e s t o a s a v i n g s i n p a i d d r i v e r t i m e o f .9 h o u r s . 2. F o r l o c a l c o m m e r c i a l t r a f f i c , t i m e i n d i v i s i b i l i t y i s more p r o n o u n c e d . One h o u r o f t i m e s a v i n g s due t o h i g h w a y r e c o n s t r u c t i o n i s assumed t o s a v i n g s i n p a i d d r i v e r t i m e o f .5 h o u r s . 3. D r i v e r wages i n Canada h a v e h i s t o r i c a l l y r i s e n a t a r a t e r o u g h l y 1.8% p e r annum a b o v e t h a t o f g e n e r a l i n f l a t i o n ( s e e APPENDIX V ) . Thus t h e v a l u e o f c o m m e r c i a l t i m e s a v i n g s i s assumed t o e s c a l a t e a t 1.8% p e r annum i n r e a l t e r m s t h r o u g h o u t t h e s t u d y t i m e h o r i z o n 1 0 7 . 4. C u r r e n t unemployment l e v e l s f o r C a n a d i a n t r u c k d r i v e r s a r e h i g h ( r o u g h l y 1 3 % ) . I t i s e x p e c t e d t h a t t h e s e r a t e s w i l l s u b s i d e o v e r t h e n e x t 4 y e a r s t o a l e v e l m a r g i n a l l y l e s s t h a n t h o s e c h a r a c t e r i s t i c o f a f u l l e m ployment economy. The h e a l t h o f t h e economy i s a s s u m e d t o f l u c t u a t e n e a r t h i s l e v e l t h r o u g h o u t t h e r e m a i n i n g 16 y e a r s o f t h e s t u d y t i m e h o r i z o n . The r e l e v a n t shadow v a l u e s f o r c o m m e r c i a l t i m e w i l l be d e t e r m i n e d by t h e s u p p l y s i d e d u r i n g t h e b e g i n n i n g few y e a r s o f t h e 20 y e a r t i m e h o r i z o n o n l y . The d i s u t i l i t y o f work i s assumed e q u a l t o o n e - h a l f t h e p r e v a i l i n g wage r a t e , 1 0 7 n o t e t h a t COBA u s e s an a n n u a l r e a l g r o w t h r a t e o f 2.3% f o r t h e v a l u e o f t i m e t o r e f l e c t i n c r e a s e s i n r e a l income REPORT OF THE ADVISORY COMMITEE ON TRUNK ROAD ASSESSMENT D.O.T. GT.BRITAIN - 1971 -1 23 i n c l u s i v e o f b e n e f i t s b u t n e t o f t a x . By 1988, r e l e v a n t shadow p r i c e s w i l l be g e n e r a l l y d e t e r m i n e d by t h e demand s i d e . A f i g u r e o f 90% o f t h e g r o s s wage p a c k a g e w i l l be u s e d . The 10% r e d u c t i o n f r o m f u l l v a l u e i s an a r b i t r a r y a d j u s t m e n t t o r e f l e c t t h e f a c t t h a t t h e h e a l t h o f t h e economy i s e x p e c t e d t o f l u c u a t e b e y o n d t h e y e a r 1988, t h u s i s i t n o t r e a s o n a b l e t o e x p e c t f u l l e m ployment t o e x i s t f o r t r u c k d r i v e r s t h r o u g h o u t t h e e n t i r e 1988-2003 p e r i o d . 5. B a s e d on r e c e n t c o l l e c t i v e a g r e e m e n t s , a s f o l l o w s : 1 0 8 UNION JOB C L A S S I F I C A T I O N DATE NET WAGE ***** ****************** ******* ******** INTERNATIONAL UNION OF OPERATING ENGINEERS DRIVER 9/1/83 13.71/HR TEAMSTERS SEMI-TRAILER DRIVER 11/1/83 15.45/HR TEAMSTERS TANDEM AXLE TRACTOR DRIVER 1/1/84 15.36/HR a g r o s s - u p f a c t o r o f 1.4 t o a c c o u n t f o r f r i n g e b e n e f i t s , a nd an a v e r a g e income t a x r a t e o f 30% f o r e m p l o y e d d r i v e r s , a p p r o p r i a t e b a s e y e a r wage r a t e s f o r c o m m e r c i a l t i m e a r e : TAX I N C L U S I V E : $15.00 X 1.4 = $21.00 NET OF TAX: $21.00 X 0.7 = $14.70 The r a t e o f $ 2 1 . 0 0 / h r i s c o n s i s t e n t w i t h a v a l u e o f $0.44 p e r m i l e w h i c h C a n a d i a n F r e i g h t w a y s u s e s t o c o s t d r i v e r t i m e (1983) on i t s A l a s k a H i g h w a y r u n s . 1 0 9 A s s u m i n g 45 m i l e s p e r h o u r a s an a v e r a g e s p e e d , t h i s t r a n s l a t e s t o a g r o s s wage o f $ ! 9 . 8 0 / h r . LABOUR RESEARCH BULLETINS B.C. M i n i s t r y o f L a b o u r 1 0 9 s o u r c e : S t e p h e n W a l l - c o s t a c c o u n t a n t - C a n a d i a n F r e i g h t w a y s 1 24 D e t a i l e d c a l c u l a t i o n s by w h i c h shadow p r i c e s f o r c o m m e r c i a l t i m e a r e d e v e l o p e d d u r i n g t h e p e r i o d 1984-2003 a r e p r o v i d e d i n A p p e n d i x V I . TABLE 4-1 l i s t s t h e v a l u e s i n s u m m a r i z e d f o r m . ******************* TABLE 4 -1 **************** c o m m e r c i a l shadow wage r a t e s (1984 d o l l a r s ) YEAR C L A S S I F I C A T I O N SHADOW PRICE/HR **** ************** *************** 1984 t h r o u g h 6.61 l o c a l 3.67 1985 t h r o u g h 9.53 l o c a l 5.29 1986 t h r o u g h 12.44 l o c a l 6.91 1987 t h r o u g h 15.34 l o c a l 8.52 1988 t h r o u g h 18.26 l o c a l 10.14 n b e y o n d 1988 t h r o u g h 1 8 . 2 6 ( 1 . 0 1 8 ) n l o c a l 1 0 . 1 4 ( 1 . 0 1 8 ) * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 4.1.1.2 E c o n o m i c V a l u e o f P e r s o n a l T r a v e l Time The e c o n o m i c t i m e c o s t o f t r a v e l l i n g i s t h e v a l u e l o s t t o an i n d i v i d u a l due t o h i s b e i n g u n a b l e t o a p p l y t h a t t i m e t o a l t e r n a t i v e a c t i v i t i e s , w h e t h e r employment r e l a t e d o r s i m p l y o f a r e c r e a t i o n a l n a t u r e o r l e i s u r e . I n t h e c a s e o f A l a s k a H i g h w a y t o u r i s m a n d l o c a l non-c o m m e r c i a l t r a v e l , v e r y l i t t l e o f t h e t i m e f r e e d a s a r e s u l t o f h i g h w a y r e c o n s t r u c t i o n i s 1 25 r e a s o n a b l y e x p e c t e d t o be r e a l l o c a t e d t o p r o d u c t i v e e m p l o y m e n t a c t i v i t i e s . A l a s k a H i g h w a y t o u r i s t s , f o r e x a m p l e w i l l s a v e some t i m e a s a r e s u l t o f h i g h w a y r e c o n s t r u c t i o n b u t t h e m a g n i t u d e w i l l be m i n u t e r e l a t i v e t o t h e o v e r a l l d u r a t i o n o f t h e i r v a c a t i o n . Many o f t h e s e t r a v e l l e r s a r e n o t a c t i v e members o f t h e l a b o u r f o r c e b u t a r e i n s t e a d e n j o y i n g e i t h e r semi o r f u l l r e t i r e m e n t . An i m p r o v e d A l a s k a H i g h w a y w i l l o f f e r them t h e o p t i o n s o f m a r g i n a l l y e x t e n d i n g t h e i r s t a y i n t h e n o r t h o r e n g a g i n g i n o t h e r l e i s u r e a c t i v i t i e s a t t h e i r p l a c e o f o r i g i n . Some l o c a l t r a v e l on t h e A l a s k a H i g h w a y i n v o l v e s c o m m u t i n g t o a n d f r o m p l a c e s o f e m p l o y m e n t . However t h e s e t r a v e l l e r s h ave been e x c l u d e d f r o m a n a l y s i s ( s e e C h a p t e r 2) b e c a u s e s e c t i o n s o f h i g h w a y o v e r w h i c h t h e y t r a v e l a r e e i t h e r i n o r n e a r m a j o r c o m m u n i t i e s a nd t h e r e f o r e a l r e a d y o f a h i g h p h y s i c a l s t a t u s a n d n o t s u b j e c t t o r e c o n s t r u c t i o n . V i r t u a l l y a l l l o c a l t r a f f i c r e l e v a n t t o t h i s s t u d y i s e i t h e r r e c r e a t i o n a l i n n a t u r e o r g e n e r a t e d a s a r e s u l t o f t h e a t t r a c t i o n s o f o t h e r c o m m u n i t i e s , f o r e x a m p l e s p e c i a l i z e d s e r v i c e s a n d e n h a n c e d s h o p p i n g . As w i t h t o u r i s m t r a f f i c , i t i s u n l i k e l y t h a t much o f t h e t i m e f r e e d a s a r e s u l t o f h i g h w a y r e c o n s t r u c t i o n w i l l c o n c e i v a b l y be d e v o t e d t o p r o d u c t i v e e mployment a c t i v i t i e s . 1 26 D e t e r m i n i n g t h e e c o n o m i c v a l u e o f a c c r u e d p e r s o n a l t i m e s a v i n g s i s n o t an e a s y t a s k . H i g h l e v e l s o f u n c e r t a i n t y and c o n t r o v e r s y o v e r t h e v a l u a t i o n o f t r a v e l t i m e a r e s u c h t h a t t h e c h o s e n f i g u r e may w e l l be w i t h i n a s much a s 50 o r 100% o f t h e a c t u a l , b u t unknown, s o c i a l v a l u e . S i n c e i t e x c l u d e s v a r i o u s m o t i o n r e l a t e d d i s c o m f o r t s , t h e e c o n o m i c v a l u e o f t r a v e l l i n g t i m e may be h y p o t h e s i z e d a s t h a t amount w h i c h an i n d i v i d u a l , who i s c o n f i n e d i n a s t a t i o n a r y m o t o r v e h i c l e , w o u l d be w i l l i n g t o pay t o be r e l e a s e d f r o m t h a t v e h i c l e so t h a t he c a n engage i n a l t e r n a t i v e , more d e s i r a b l e , a c t i v i t i e s . W h i l e e a r l y A m e r i c a n and B r i t i s h B/C s t u d i e s u s e d 75% o f t h e p r e v a i l i n g wage r a t e t o v a l u e p e r s o n a l t r a v e l t i m e , t h i s p r a c t i s e was s u p e r c e e d e d i n t h e m i d 1960's by a s u b s t a n t i a l l y r e d u c e d v a l u e 1 1 0 . The s t a n d a r d , s t i l l b e i n g u s e d t o d a y , i s t o v a l u e t h e t i m e o f e a c h a d u l t o c c u p a n t a t 2 5 % o f t h e p r e v a i l i n g wage r a t e and t h e t i m e v a l u e o f e a c h c h i l d a t one t h i r d t h a t o f an a d u l t . Some s u g g e s t e d a n d a p p l i e d v a l u e s p e r h o u r f o r p e r s o n a l t r a v e l l i n g t i m e a r e a s l i s t e d i n TABLE 1 1 0 THE ECONOMICS OF TRANSPORT APPRAISAL - 1974 - A . J . H a r r i s o n p. 1 24 1 27 4.2. N o t e t h a t t h e s e v a l u e s a r e g e n e r a l l y b a s e d on a v e h i c l e o c c u p a n c y o f a p p r o x i m a t e l y 1.5 p e r s o n s w h i c h i s n o t r e p r e s e n t a t i v e o f A l a s k a H i g h w a y t r a f f i c . T o u r i s t v e h i c l e s a l o n g t h i s ****************** TABLE 4 — 2 ********************* SUGGESTED VALUES FOR PERSONAL TRAVEL TIME ( d o l l a r s p e r v e h i c l e ) STUDY OR ORGANIZATION ********************* NATIONAL HIGHWAYS NEEDS REPORT , PWC (ALASKA HIGHWAY STUDY) .. CALIFORNIA D I V I S I O N OF HIGHWAYS A • A. • S * H • 0 • •••••••••• UBC (CTS 1980 REPORT). YEAR $/HR APPROXIMATE 1984 $/HR **** **** *********** 1972 2.25 5.92 1980 5.00 6.75 1963 1.56 5.11 1960 1.55 5.26 1974 3.00 6.86 **************************************************** c o r r i d o r a r e known t o c a r r y , on t h e a v e r a g e , 2.7 p e r s o n s p e r u n i t ( s e e C h a p t e r 7 ) . I t i s assumed i n t h i s r e p o r t t h a t v e h i c l e s i n t h e l o c a l t r a f f i c c a t e g o r y h a v e r o u g l y t h e same o c c u p a n c y a s t o u r i s t v e h i c l e s . T h i s i s c o n s i s t e n t w i t h a s u r v e y c o n d u c t e d i n t h e L i a r d R i v e r a r e a by B.C.Hydro i n 1980. U s i n g a p r e v a i l i n g wage r a t e o f $12.00 p e r h o u r , 128 and .7 c h i l d r e n p e r v e h i c l e ( t o u r i s t and l o c a l ) , t h e v a l u e s o f p e r s o n a l t r a v e l t i m e t o be u s e d i n t h i s s t u d y a r e c a l c u l a t e d t o be: [ 2 ( . 2 5 ) + . 7 ( . 0 8 ) ] ( 1 2 ) = $ 6 . 6 7 / h r / v e h i c l e ( 1 9 84) The u n c e r t a i n t i e s i n h e r e n t i n t h i s f i g u r e r e q u i r e s t h a t i t be s u b j e c t t o s e n s i t i v i t y a n a l y s i s ( s e e C h a p t e r 8 ) . V a l u e s w i l l e s c a l a t e a t 2% p e r annum t o r e f l e c t h i s t o r i c g r o w t h i n r e a l i n c o m e s w h i c h , d e s p i t e t h e c u r r e n t e c o n o m i c s e t b a c k , a r e g e n e r a l l y e x p e c t e d t o c o n t i n u e i n f u t u r e y e a r s . • 4.1.7 D I S U T I L I T Y OF TRAVEL: T h i s d i s u t i l i t y i s c o m p r i s e d of s e v e r a l c o m p o n e n t s s u c h a s a c t u a l p h y s i c a l d i s c o m f o r t due t o j a r r i n g a n d s w a y i n g m o t i o n , f e a r o f p e r c e i v e d p e r s o n a l i n j u r y o r v e h i c u l a r damage, an d d r i v e r f a t i g u e . H i g h w a y i m p r o v e m e n t s o f t e n g e n e r a t e s i g n i f i c a n t b e n e f i t s i n t h e f o r m r e d u c e d d i s u t i l i t y a s s o c i a t e d w i t h v e h i c l e m o t i o n t o b o t h v e h i c l e d r i v e r s a n d p a s s e n g e r s . C o n s i d e r a t i o n f o r t h i s b e n e f i t h a s b een a n d c o n t i n u e s t o be a s o u r c e o f n e g l e c t i n h i g h w a y i m p r o v e m e n t s t u d i e s , p r i m a r i l y b e c a u s e o f t h e i n h e r e n t d i f f i c u l t y i n d e t e r m i n i n g i t s v a l u e . A common t r e a t m e n t i s t o i g n o r e t h e c o m f o r t f a c t o r e n t i r e l y , a s was done be P.W.C. I n 1 29 i t s e v a l u a t i o n o f t h e A l a s k a H i g h w a y u p g r a d i n g p r o g r a m . A n o t h e r a l t e r n a t i v e i s t o s i m p l y m u l t i p l y t h e t i m e c o s t s f o r t r a v e l o v e r " r o u g h " h i g h w a y s by two t o t h r e e t i m e s t h e s t a n d a r d r a t e 1 1 1 . A.A.S.H.O. recommends v a l u i n g t h e d i s c o m f o r t a s s o c i a t e d w i t h d r i v i n g a v e h i c l e o v e r l o o s e s u r f a c e d h i g h w a y s a t .75 c e n t s / m i l e o r a p p r o x i m a t e l y 2.0 c e n t s / m i l e i n c u r r e n t d o l l a r s 1 1 2 . A l l t h e a b o v e t r e a t m e n t s c a n be d e s c r i b e d a s a r b i t r a r y a n d do n o t n e c e s s a r i l y b e a r much r e s e m b l a n c e t o t h e a c t u a l v a l u e o f c h a n g e s i n c o m f o r t l e v e l s . A l l o c c u p a n t s o f a v e h i c l e must c o p e w i t h r o u g h s u r f a c e s w h i c h g e n e r a t e v i b r a t i o n , o t h e r m o t i o n s , a n d v a r i o u s d e g r e e s o f d u s t , e a c h o f w h i c h c r e a t e s a f e e l i n g o f p h y s i c a l d i s c o m f o r t . The d r i v e r i s s u b j e c t e d an a d d i t i o n a l d i s u t i l i t y , t h a t o f m e n t a l d i s t r e s s a s he f i g h t s t o a v o i d p o t h o l e s , s u r f a c e r u t s , a n d o t h e r c h a r a c t e r i s t i c s o f low q u a l i t y h i g h w a y s . The r e l a t i v e m a g n i t u d e s o f t h e s e f a c t o r s w o u l d d e p e n d b o t h on t h e t y p e o f v e h i c l e a n d t h e d e g r e e o f a d a p t a t i o n o f d r i v e r s a n d p a s s e n g e r s t o p o o r h i g h w a y c o n d i t i o n s . O c c u p a n t s o f c o m m e r c i a l v e h i c l e s c h a r a c t e r i z e d by l o n g w h e e l b a s e s , l a r g e d i a m e t e r t i r e s , a n d s u b s t a n t i a l v e h i c l e w e i g h t may be s u b j e c t e d t o l o w e r l e v e l s o f p h y s i c a l d i s c o m f o r t t h a n 1 1 1 TRANSPORTATION ENGINEERING ECONOMICS - 1972 - IAN HEGGIE p.87 1 1 2 ROAD USER BENEFIT ANALYSIS FOR HIGHWAY IMPROVEMENTS - 1960 -A.A.S.H.O. P. 128 130 w o u l d o c c u p a n t s o f t y p i c a l p a s s e n g e r v e h i c l e s . A 1974 s t u d y 1 1 3 u s e d a v a l u e o f 2.2 c e n t s p e r v e h i c l e m i l e t o r e p r e s e n t t h e b e n e f i t i n t e r m s o f r e d u c e d t r a v e l l i n g d i s u t i l i t y ( n o n - c o m m e r c i a l ) t h a t w o u l d be g e n e r a t e d d i r e c t l y by m a j o r A l a s k a H i g h w a y r e c o n s t r u c t i o n . However 1.2 c e n t s o f t h a t f i g u r e i s i n t h e f o r m o f a c t u a l t i m e s a v i n g s due t o d e c r e a s e d d r i v e r f a t i g u e w h i c h was t h o u g h t t o be t r a n s l a t e d i n t o e x t e n d e d d u r a t i o n s o f d r i v i n g b e t w e e n r e s t s t o p s . The r e m a i n i n g 1 c e n t r e p r e s e n t s t h e b e n e f i t a r i s i n g b e c a u s e o f r e d u c e d d u s t l e v e l s a n d a s s o c i a t e d c l e a n i n g c o s t s and damage. R e d u c t i o n s i n p h y s i c a l d i s c o m f o r t due t o i m p r o v e d v e r t i c a l a n d h o r i z o n t a l a l i g n m e n t s a n d i m p r o v e d s u r f a c e r o u g h n e s s f a c t o r s were n o t a c c o u n t e d f o r . The Commonwealth B u r e a u o f Roads a t t a c h e s a v a l u e o f .3 c e n t s p e r k i l o m e t e r ( 1 9 7 6 ) f o r t h e r e d u c t i o n i n r o a d c o n d i t i o n d i s u t i l i t y a s a h i g h w a y s u r f a c e i s u p g r a d e d f r o m g r a v e l t o a s e a l e d s t a t u s 1 1 " . T h e r e e x i s t s a g e n e r a l l a c k o f r e s e a r c h i n t o d i s c o m f o r t l e v e l s a s s o c i a t e d w i t h t r a v e l l i n g o v e r g r a v e l s u r f a c e s t r e a t e d w i t h c a l c i u m c h l o r i d e o r b i t u m i n o u s s u r f a c e 1 1 3 CTS REPORT -U.B.C -1974- p p . 2 5 3 - 2 5 6 1 1 t t ECONOMICS OF ROAD DESIGN STANDARDS - VOLUME 2 - 1980 - BUREAU OF TRANSPORT ECONOMICS P. 221 131 t r e a t e d h i g h w a y s . New o r w e l l m a i n t a i n e d B.S.T. s e c t i o n s a r e r o u g h l y c o m p a r a b l e t o pavement i n t e r m s o f r i d i n g c o m f o r t . However t h o s e w h i c h a r e o l d e r o r p o o r l y m a i n t a i n e d a r e o f t e n r i d d l e d w i t h p o t h o l e s a n d c a n g e n e r a t e s i g n i f i c a n t l y more d i s c o m f o r t , e s p e c i a l l y i n t h e f o r m o f d r i v e r f a t i g u e , t h a n e v e n u n t r e a t e d g r a v e l s u r f a c e s . I t w o u l d be p a r t i c u l a r l y d i f f i c u l t t o a s s e s s t h e v a l u e o f r e d u c e d d i s c o m f o r t a s s o c i a t e d w i t h t h e i m p r o v e m e n t o f a h i g h w a y w h i c h was o r i g i n a l l y t o p p e d w i t h a v a r i e t y o f s u r f a c e s r a t h e r t h a n j u s t o n e. S u r f a c e s w h i c h c u r r e n t l y e x i s t on t h e A l a s k a H i g h w a y , a s d i s c u s s e d i n C h a p t e r 2, i n c l u d e g ood q u a l i t y p a v e m e n t , u n s u r f a c e d g r a v e l , c a l c i u m c h l o r i d e s u r f a c e d g r a v e l , a n d b o t h new a n d o l d B.S.T. I g n o r i n g t h e b e n e f i t o f r e d u c e d d i s c o m f o r t may be i n v i t i n g t o t h e p l a n n e r / a n a l y s t b e c a u s e o f t h e i n h e r e n t f r u s t r a t i o n a n d e f f o r t r e q u i r e d t o e s t i m a t e d i t s v a l u e i n a s p e c i f i c h i g h w a y i m p r o v e m e n t p r o g r a m . However i n d i c a t i o n s a r e t h a t u s e r b e n e f i t s o f t h i s f o r m may be s u b s t a n t i a l 1 1 5 . F o r a m a j o r h i g h w a y i m p r o v e m e n t p r o g r a m , s u c h a s t h a t o f t h e A l a s k a H i g h w a y p r o p o s a l w h i c h w i l l c o s t i n e x c e s s o f 500 m i l l i o n d o l l a r s , t h e e x t r a e f f o r t may w e l l be j u s t i f i e d . 1 5 a 1975 N o r t h e r n T o u r i s m s u r v e y i n d i c a t e d t h a t t h e c h i e f c o m p l a i n t o f h i g h w a y b a s e d t o u r i s t s d e s t i n e d f o r t h e Yukon o r b e y o n d was p o o r h i g h w a y c o n d i t i o n s 1 32 V a l u e s To Be Us e d I n T h i s S t u d y : The b e n e f i t due t o r e d u c e d d u s t , a s u s e d i n t h e U.B.C.-C.T.S. s t u d y , a f t e r i n f l a t i n g t o 1984 d o l l a r s a n d c o n v e r t i n g t o m e t r i c , i s 1.4 c e n t s p e r v e h i c l e k i l o m e t e r . F o r l a c k o f a d d i t i o n a l p u b l i s h e d r e s e a r c h on t h e t o p i c , 1.4 c e n t s w i l l be a p p l i e d i n t h i s s t u d y a s one component o f d i s c o m f o r t c o s t s . M o t i o n r e l a t e d d i s c o m f o r t i s assumed t o be r e d u c e d t o t h e e x t e n t t h a t e a c h o c c u p a n t w i l l a c c r u e a b e n e f i t o f .6 c e n t s p e r k i l o m e t e r , on a v e r a g e . I n a d d i t i o n , t h e d r i v e r o f e a c h v e h i c l e i s a s s u m e d t o a c c r u e a b e n e f i t i n t h e f o r m o f r e d u c e d m e n t a l f a t i g u e a n d s t r e s s e q u a l t o 1.4 c e n t s p e r k i l o m e t e r , on a v e r a g e . F o r c o m m e r c i a l , l o c a l , a n d t o u r i s m t r a f f i c , b e n e f i t s i n t h e f o r m o f r e d u c e d r o a d c o n d i t i o n r e l a t e d d i s u t i l i t y a r e , i n 1984 $/km: COMMERCIAL 0.034 LOCAL 0.044 TOURISM 0.044 1 33 • 4.1.3 VEHICLE DEPRECIATION: T h i s component o f u s e r c o s t s h a s been t h e s u b j e c t o f l i m i t e d r e s e a r c h i n t h e p a s t . C o m p o s i n g up t o o n e - t h i r d o f t o t a l v e h i c l e o p e r a t i n g c o s t s , d e p r e c i a t i o n may be a c a n d i d a t e f o r i n c r e a s e d r e s e a r c h e f f o r t s i n t h e f u t u r e . Two i s s u e s a r e s o u r c e s o f c o n t r o v e r s y , i n c l u d i n g : 1. Can d i s t a n c e - r e l a t e d d e p r e c i a t i o n r e a s o n a b l y be a s s u m e d n o t t o v a r y w i t h h i g h w a y a l i g n m e n t and s u r f a c e q u a l i t y ? 2. How s h o u l d d e p r e c i a t i o n be d i s t r i b u t e d b e t w e e n t i m e a n d d i s t a n c e f a c t o r s ? ( t h i s i s s u e i s s p e c i f i c t o non c o m m e r c i a l p a s s e n g e r v e h i c l e s ) One l i n e o f t h o u g h t " i s t h a t i d e n t i c a l d e p r e c i a t i o n r a t e s s h o u l d be u s e d f o r a l l q u a l i t i e s o f h i g h w a y s u r f a c e and a l i g n m e n t . 1 1 6 Two r a t i o n a l e s a r e u s e d t o j u s t i f y t h i s h y p o t h e s i s . F i r s t , g r e a t e r v e h i c l e wear r a t e s a r e a s s o c i a t e d w i t h h i g h s p e e d o p e r a t i o n . The p o o r s u r f a c e a n d a l i g n m e n t s o f l o w q u a l i t y h i g h w a y s f o r c e t h e d r i v e r t o t r a v e l a t l o w e r s p e e d s , t h u s c o m p e n s a t i n g t o some e x t e n t f o r t h e more s e v e r e h i g h w a y c o n d i t i o n s . S e c o n d , i t i s a r g u e d t h a t some o f t h e h i g h e r d e p r e c i a t i o n i s a c c o u n t e d f o r by t h e h i g h e r m a i n t e n a n c e c o s t s a l l o c a t e d t o t h o s e m i l e s t r a v e l l e d on l o w q u a l i t y h i g h w a y s . I n c o n t r a s t , a number o f s o u r c e s s u g g e s t t h a t d e p r e c i a t i o n c o s t s do r i s e i n v e r s e l y w i t h s u r f a c e q u a l i t y , a s l i s t e d 1 1 6 u s e d by P.W.C., s u p p o r t e d by AASHO, e t c . 1 34 i n TABLE 4-3. As d i s c u s s e d i n C h a p t e r 3, c u r r e n t l y u n p a v e d s e c t i o n s o f A l a s k a H i g h w a y a r e s u r f a c e t r e a t e d . E x p e c t a t i o n s a r e t h a t t h e a d d i t i o n a l m a i n t e n a n c e ******************* TABLE 4 _ 3 ********************* DEPRECIATION/KM (RELATIVE FIGURES) SOURCE PAVED SURFACE GRAVEL ****** ************* ****** ABOUCHAR(1977) PP.60-61 AUTO 1 1.06 2-AXLE 1 1.19 5-AXLE 1 1.42 ADLER(1971) P. 58 AUTO 1 1.28 TRUCK 1 1.49 MEYER(1971) P. 172 NO C L A S S I F I C A T I O N 1 1.49 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * e x p e n s e , r e l a t i v e t o t h a t o f p a v e d s u r f a c e s , w o u l d n o t be a s d r a m a t i c a s t h e g r a v e l / p a v e m e n t d e p r e c i a t i o n d i f f e r e n t i a l . T h i s s t u d y a s sumes t h e r e l a t i v e d e p r e c i a t i o n c o s t s f o r a u t o m o b i l e s , 2 - a x l e , a n d 5 - a x l e c o m m e r c i a l v e h i c l e s a s l i s t e d i n TABLE 4-4. The s e c o n d i s s u e , t h a t o f t h e r e l a t i v e a l l o c a t i o n s o f d e p r e c i a t i o n b e t w e e n d i s t a n c e a n d t i m e , r e l a t e s e x c l u s i v e l y t o p r i v a t e p a s s e n g e r v e h i c l e s . The m a r k e t v a l u e o f an a u t o m o b i l e i s a f u n c t i o n o f m u l t i p l e v a r i a b l e s w h e r e a s t h a t o f a c o m m e r c i a l v e h i c l e i s 135 ********************* TABLE 4 _ 4 *********************** DEPRECIATION (REL A T I V E ) BY SURFACE QUALITY VEHICLE CLASS PAVED SURFACE BST AND C a C l TREATED ************* ************* ******************** AUTOS 1 1.10 2-AXLES 1 1.20 5-AXLES 1 1.35 ******************************************************* d e t e r m i n e d by i t s a b i l i t y t o p e r f o r m one f u n c t i o n , t h a t b e i n g t h e movement o f c o m m o d i t i e s . F o r c o m m e r c i a l v e h i c l e s w h i c h a r e o t h e r w i s e i d e n t i c a l , t h i s a b i l i t y i s m e a s u r e d a l m o s t e x c l u s i v e l y by t h e r e m a i n i n g e c o n o m i c l i f e o f t h e v e h i c l e , i n t u r n a f u n c t i o n o f t o t a l v e h i c l e k i l o m e t e r s a t t h a t p o i n t i n t i m e . U n l e s s a s e r i e s o f n o n - t r a n s f e r a b l e m e c h a n i c a l i n n o v a t i o n s a d o p t e d by t r u c k m a n u f a c t u r e r s a r e s u b s t a n t i a l e nough t o a c c e l e r a t e t h e o b s o l e s e n c e o f e x i s t i n g v e h i c l e s , age s h o u l d be a v e r y m i n o r f a c t o r i n d e t e r m i n i n g t h e m a r k e t p r i c e o f a c o m m e r c i a l v e h i c l e . D e t e r i o r a t i o n , t h e r e f o r e d e p r e c i a t i o n , i s a l m o s t e n t i r e l y a f u n c t i o n o f d i s t a n c e . C o n v e r s e l y , t h e v a l u e o f an a u t o m o b i l e i s g e n e r a l l y m e a s u r e d by two c r i t e r i a , t h o s e b e i n g i t s a b i l i t y t o p r o v i d e t r a n s p o r t a t i o n a n d , u n l i k e c o m m e r c i a l v e h i c l e s , i t s r e l a t i v e a e s t h e t i c v a l u e . I t i s a e s t h e t i c o b s o l e s e n c e t h a t d e p r e c i a t e s an a u t o m o b i l e on t h e b a s i s o f t i m e . W h i l e one s c h o o l o f t h o u g h t i s t h a t l o s s i n v a l u e i s a l m o s t e n t i r e l y d e p e n d e n t on v e h i c l e a g e , 1 36 o p p o s i n g f o r c e s assume d e p r e c i a t i o n t o be f u l l y two-t h i r d s r e a t e d t o d i s t a n c e . AASHO a r b i t r a r i l y s p l i t s d e p r e c i a t i o n e v e n l y b e t w e e n t i m e a n d d i s t a n c e 1 1 7 . P.W.C.'s i n i t i a l d r a f t o f t h e A l a s k a H i g h w a y Improvement P r o g r a m a n a l y s i s a l l o c a t e d o n l y 16% o f d e p r e c i a t i o n t o d i s t a n c e , y i e l d i n g a p e r k i l o m e t e r r a t e o f o n l y $.00746 f o r a t y p i c a l a u t o m o b i l e 1 1 8 . I t a p p e a r s t h a t f a c t o r s w h i c h i n f l u e n c e d t h e c h o i c e o f t i m e / d i s t a n c e d e p r e c i a t i o n a l l o c a t i o n s a s r e p o r t e d i n e x i s t i n g s t u d i e s h a v e c h a n g e d c o n s i d e r a b l y . F o r e x a m p l e , t h o s e d e p r e c i a t i o n a s s u m p t i o n s o f P.W.C. and A.A.S.H.O. a r e b a s e d on v e h i c l e s o f v i n t a g e s r a n g i n g b e t w e e n t h e m i d 1940's a nd t h e m i d 1 9 6 0 ' s . M a n u f a c t u r e r s o f v e h i c l e s d u r i n g t h o s e y e a r s p l a c e d c o n s i d e r a b l e e m p h a s i s on a n n u a l s h e e t m e t a l a n d g r i l l d e s i g n c h a n g e s w h i c h , i n t e n t i o n a l l y o r n o t , a c c e l e r a t e d a e s t h e t i c o b s o l e s e n c e . I t may w e l l be t h a t v e h i c l e age was a s i g n i f i c a n t d e t e r m i n a n t o f m a r k e t v a l u e s d u r i n g t h o s e t i m e s . C o n t e m p o r a r y v e h i c l e m a n u f a c t u r i n g h a s , w i t h some e x c e p t i o n s , v i r t u a l l y e l i m i n a t e d t h e p r a c t i s e o f r e d e s i g n i n g b ody p a n e l s a n d g r i l l s on a y e a r l y b a s i s . I t i s now d i f f i c u l t f o r t h e u n t r a i n e d e y e t o d e t e r m i n e t h e r e l a t i v e a g e s o f many v e h i c l e m o d e l s . I t may be t h a t 1 1 7 ROAD USER BENEFIT ANALYSIS FOR HIGHWAY IMPROVEMENTS - 1960 -A.A.S.H.O. 1 1 8 P u b l i c Works C a n a d a i n t e r n a l memorandum 1 37 t i m e i s now much l e s s a f a c t o r i n v e h i c l e d e p r e c i a t i o n t h a n was once t h e c a s e . An a l l o c a t i o n o f d e p r e c i a t i o n t o d i s t a n c e o f p e r h a p s 75% may be more a p p r o p r i a t e i n c o n t e m p o r a r y t i m e s . A v e h i c l e c o s t b a s e must now be d e t e r m i n e d . R e t a i l p r i c e s o f an a u t o m o b i l e s i n c l u d e b o t h f e d e r a l and p r o v i n c i a l t a x e s w h i c h a r e o v e r and a b o v e t h e v a l u e o f r e s o u r c e s consumed i n p r o d u c i n g t h e v e h i c l e . The a p p r o p r i a t e b a s e c o s t must be i n c l u s i v e o f t a x e s , t h a t i s , t h e amount a c o n s u m e r i s w i l l i n g t o d i v e r t f r o m o t h e r c o n s u m p t i o n g o o d s so t h a t he c a n p u r c h a s e t h e v e h i c l e . The c o s t o f t i r e s i n s t a l l e d on t h e v e h i c l e must be i s o l a t e d a n d removed s i n c e t i r e c o s t s a r e a c c o u n t e d f o r i n a s e p a r a t e c a t e g o r y a n d n o t t o do so w o u l d amount t o d o u b l e c o u n t i n g . T h i s a d j u s t m e n t i s e a s i l y i g n o r e d b u t n o t n e c e s s a r i l y t r i v i a l . The c o s t o f t i r e s on a s emi t r a c t o r a n d t r a i l e r may amount t o s e v e r a l t h o u s a n d d o l l a r s . The c o r r e c t c o s t b a s e i s t h e r e f o r e t h e c u r r e n t r e t a i l p r i c e o f a t y p i c a l v e h i c l e o f e a c h c a t e g o r y i n t h e s t u d y a r e a n e t o f t i r e c o s t s . A common a s s u m p t i o n i s t h a t t h e l i f e o f an a u t o m o b i l e i s 161,000 k i l o m e t e r s ( 1 0 0 , 000 m i l e s ) . However C l a f f e y r e p o r t e d t h a t a s u r v e y o f v e h i c l e s r e m o v e d f r o m t h e h i g h w a y ( p r e s u m a b l y i n t h e l a t e 1960's) y i e l d e d an a v e r a g e l i f e o f some 210,000 k i l o m e t e r s . T h i s s t u d y a p p l i e s e v e n w e i g h t s t o t h e s e two v a l u e s a n d a s sumes an 1 38 a v e r a g e l i f e o f 185,000 k i l o m e t e r s . V a l u e s f o r D e p r e c i a t i o n t o be A p p l i e d i n T h i s S t u d y : C o m m e r c i a l V e h i c l e s : T r a n s p o r t Canada l i s t s d e p r e c i a t i o n c o s t s f o r 2 - a x l e a n d 5 - a x l e c o m m e r c i a l v e h i c l e s a s .065 a n d .088 d o l l a r s p e r k i l o m e t e r ( 1 9 8 0 ) . A d j u s t i n g t h e s e f i g u r e s downward t o e l i m i n a t e t i r e c o s t s , a n d upward t o a c c o u n t f o r i n f l a t i o n y i e l d s t h e f o l l o w i n g i n d o l l a r s p e r k i l o m e t e r ( 1 9 8 4 ) : PAVED SURFACE TREATED SURFACE ************* *************** 2-AXLE .070 .084 5 - a x l e .095 .128 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * T h e s e r e s u l t s a r e i n g e n e r a l a g r e e m e n t w i t h C a n a d i a n F r e i g h t w a y c o s t d a t a o f $ . 1 1 8 / k i l o m e t e r (1973 a v e r a g e ) f o r i t s A l a s k a H i g h w a y r u n s . L o c a l T r a f f i c : T h i s s t u d y assumes an a v e r a g e new v e h i c l e c o s t o f $9500 (1984 n e t o f t i r e s ) f o r v e h i c l e s i n t h e r e g i o n . A l l o c a t i n g 7 5 % o f v e h i c l e d e p r e c i a t i o n t o d i s t a n c e a n d a s s u m i n g a l i f e o f 185,000 k i l o m e t e r s , d e p r e c i a t i o n c o s t s p e r k i l o m e t e r f o r t h i s t r a f f i c a r e : 1 39 PAVED SURFACE TREATED SURFACE ************* *************** LOCAL $.040 $.044 ********************************* T o u r i s t T r a f f i c : R o u g h l y 2 5% o f t h i s t r a f f i c c a t e g o r y c o n s i s t s o f m o t o r homes and a u t o m o b i l e a n d t r a i l e r c o m b i n a t i o n s (See s e c t i o n 7 . 6 . 2 ) . T h e s e a r e f a i r l y e x t r e m e d e v i a t i o n s f r o m what a r e g e n e r a l l y c l a s s i f i e d a s a u t o m o b i l e s , h e n c e i t may n o t be a p p r o p r i a t e t o d e p r e c i a t e t h e s e v e h i c l e s a t t h e same r a t e a s a u t o m o b i l e s . D o c u m e n t a t i o n d e t a i l i n g how t h e s t r u c t u r a l i n t e g r e t y o f m o t o r home a n d t r a v e l t r a i l e r b o d i e s i s r e l a t e d t o d i s t a n c e g e n e r a l l y , a n d s u r f a c e q u a l i t y s p e c i f i c a l l y , i s n o t a v a i l a b l e . S i m i l a r l y , i t i s n o t c l e a r how a v e h i c l e ' s d i s t a n c e r e l a t e d d e p r e c i a t i o n i s a f f e c t e d by a d d i t i o n a l c h a s s i s a n d d r i v e t r a i n s t r e s s e x p e r i e n c e when p u l l i n g a t r a v e l t r a i l e r . F o r l a c k o f d e s i r e d r e s e a r c h d a t a , t h i s s t u d y a s s umes d e p r e c i a t i o n c o s t s f o r t h e s e n o n -s t a n d a r d v e h i c l e s t o r e s e m b l e t h o s e o f v e h i c l e s i n t h e 2 - a x l e c o m m e r c i a l c l a s s i f i c a t i o n . The r e m a i n i n g 7 5 % o f t o u r i s t v e h i c l e s , c o n s i s t i n g o f p i c k - u p t r u c k s , v a n s , a u t o m o b i l e s , a n d s t a t i o n 1 40 wagons, w i l l be d e p r e c i a t e d a t r a t e s i d e n t i c a l t o t h o s e d e s i g n a t e d f o r l o c a l A l a s k a H i g h w a y v e h i c l e s . The w e i g h t e d a v e r a g e d i s t a n c e r e l a t e d d e p r e c i a t i o n c o s t s f o r t o u r i s t v e h i c l e s (1984 d o l l a r s ) a r e t h e r e f o r e : PAVED SURFACE TREATED SURFACE ************* *************** TOURISM $.048 $.054 ********************************* • 4.1.4 VEHICULAR ACCIDENTS V a l u e s must be p l a c e d on t h e b e n e f i t t o s o c i e t y o f a r e d u c t i o n i n e a c h o f t h r e e c l a s s i f i c a t i o n s o f a c c i d e n t s , i n c l u d i n g : 1 . F a t a l a c c i d e n t s 2. I n j u r y a c c i d e n t s 3. P r o p e r t y a c c i d e n t s The e c o n o m i c c o s t s o f a c c i d e n t s i n t h e U n i t e d S t a t e d u r i n g 1971 t o t a l l e d 11 b i l l i o n d o l l a r s . T h i s f i g u r e i s j u s t b e l o w t h e 13 b i l l i o n d o l l a r s a l l o c a t e d t o a l l h i g h w a y c o n s t r u c t i o n a n d m a i n t e n a n c e p r o g r a m s d u r i n g t h e 141 same y e a r 1 1 9 . A c c i d e n t r e d u c t i o n a s a p e r c e n t a g e o f t o t a l b e n e f i t s a c c r u i n g f r o m a r e g i o n a l h i g h w a y u p g r a d i n g p r o g r a m may r a n g e f r o m 2 . 8 % 1 2 0 t o 20% o r more. 4.1.4.1 V a l u e o f L i f e a n d t h e S o c i a l C o s t o f F a t a l  A c c i d e n t s : Of a l l r e s o u r c e s s a v e d a s a r e s u l t o f h i g h w a y i m p r o v e m e n t s , a human l i f e i s t h e most c o n t r o v e r s i a l i n t e r m s o f i t s s o c i a l v a l u e . The o b j e c t i v e i n b e n e f i t / c o s t a n a l y s i s i s n o t t o p l a c e a v a l u e on a s p e c i f i c l i f e b u t i n s t e a d t o e s t i m a t e what s o c i e t y a s a w h o l e w o u l d be w i l l i n g t o pay f o r a r e d u c t i o n o f r i s k by a m a g n i t u d e s u f f i c i e n t t o p r e v e n t one a s y e t unknown member o f s o c i e t y f r o m d y i n g . Some may c l a i m t h a t any a t t e m p t t o p l a c e a v a l u e on a human l i f e i s i m m o r a l a n d a n e e d l e s s e x e r c i s e s i n c e any i n v e s t m e n t i s j u s t i f i e d i f i t w i l l r e s u l t i n t h e s a v i n g o f a l i f e . H o w ever, a l l members o f s o c i e t y i m p l i c i t l y i n d i c a t e t h a t t h e y f e e l l i f e i s o f a f i n i t e v a l u e . They do so by e n g a g i n g i n a c t i v i t i e s w h i c h p o s e some t h r e a t t o l i f e , w h e t h e r i t i n v o l v e s hang g l i d i n g o r s i m p l y w a l k i n g up a s e t o f s t a i r s . I f l i f e were o f i n f i n i t e v a l u e , a l l o f s o c i e t y ' s r e s o u r c e s w o u l d be d i r e c t e d 1 1 9 SUMMARY AND EVALUATION OF ECONOMIC CONSEQUENCES OF HIGHWAY  IMPROVEMENTS - 1971 N.C.H.R.P. REPORT #122 1 2 0 VALUE AND VALUE JUDGEMENTS IN ROAD AND ACCIDENT EVALUATION -1980- D.G.T REPORT #245 1 42 t o p r o g r a m s w h i c h a r e d e s i g n e d t o s a v e l i v e s a n d n o t h i n g e l s e . T h i s i s o b v i o u s l y n o t t h e c a s e t o d a y . More i m p o r t a n t , i t i s n e c e s s a r y t o e x p l i c i t l y s e t a v a l u e on l i f e s o t h a t r e s o u r c e s w h i c h a r e consumed i n g o v e r n m e n t s p o n s o r e d h e a l t h a n d s a f e t y p r o g r a m s a r e e f f i c i e n t l y a l l o c a t e d among t h o s e p r o g r a m s . U n f o r t u n a t e l y , t h i s d e s i r e d e f f i c i e n t a l l o c a t i o n o f r e s o u r c e s i s f a r f r o m r e a l i t y . C o s t s p e r l i f e s a v e d i n p r o g r a m s s u p p o r t e d , o p e r a t e d , o r m a n d a t e d by t h e U.S. G o v e r n m e n t , f o r e x a m p l e , r a n g e f r o m $37,500 t o $ 6 2 4 , 9 7 6 , 0 0 0 1 2 1 I t i s s a i d t h a t t h e d e a t h s w h i c h r e c e i v e l e a s t p u b l i c i t y , s u c h a s t r a f f i c d e a t h s r e s u l t i n g f r o m p o o r l y c o n s t r u c t e d h i g h w a y s , a r e c o r r e s p o n d i n g l y a l l o c a t e d t h e l o w e s t c o s t s a n d r e c e i v e t h e l e a s t f u n d s by t h e p o l i t i c a l s y s t e m . P l a c i n g a l o w v a l u e on t h e d e a t h -r e d u c t i o n b e n e f i t s o f h i g h w a y i m p r o v e m e n t p r o g r a m s w i l l l e a d t o a m i s a l l o c a t i o n o f r e s o u r c e s a n d u n d e r i n v e s t m e n t i n h i g h w a y u p g r a d i n g . Those a r e a s o f e c o n o m i c t h e o r y w h i c h a d d r e s s l i f e v a l u a t i o n a r e e x t r e m e l y c o n t r o v e r s i a l . D e p e n d i n g on w h i c h o f t h r e e m a j o r m e t h o d o l o g i e s one a c c e p t s , t h e b e n e f i t t o s o c i e t y o f an i n v e s t m e n t w h i c h s a v e s one l i f e may r a n g e f r o m a f i g u r e w h i c h i s n e g a t i v e t o one i n t h e r a n g e o f s e v e r a l m i l l i o n d o l l a r s a n d more. The t h r e e 2 1 I b i d . P.26 143 e x i s t i n g m e t h o d o l o g i e s i n c l u d e : 1. F o r e g o n e P r o d u c t i o n : The l o s s t o s o c i e t y a c c r u i n g a s a r e s u l t o f a p e r s o n ' s d e a t h i s c a l c u l a t e d t o be t h e v a l u e o f h i s f u t u r e n e t o r g r o s s p r o d u c t i o n w h i c h w o u l d o t h e r w i s e be r e a l i z e d . The g r o s s p r o d u c t i o n method i n c o r p o r a t e s two v a r i a b l e s , g r o s s e a r n i n g s p e r y e a r , a nd t h e p r o b a b i l i t y o f t h a t p e r s o n b e i n g a l i v e i n e a c h f u t u r e y e a r , a s f o l l o w s : w h e r e : Y-t = g r o s s e a r n i n g s o f t h e p e r s o n i n y e a r t Pt = p r o b a b i l i t y o f t h e p e r s o n b e i n g a l i v e i n y e a r t R = t h e s o c i a l d i s c o u n t r a t e The n e t f o r g o n e p r o d u c t i o n a p p r o a c h i s i d e n t i c a l t o t h a t a b o v e w i t h t h e e x c e p t i o n t h a t t h e i n d i v i d u a l ' s a n n u a l c o n s u m p t i o n i s s u b t r a c t e d f r o m h i s a n n u a l p r o d u c t i o n b e f o r e d i s c o u n t i n g . One s o u r c e 1 2 2 l i s t s t h e f o l l o w i n g d i s c o u n t e d v a l u e s (1975 d o l l a r s ) o f e x p e c t e d f u t u r e work e f f o t s by age a n d s e x : oo V a l u e 1 44 AGE MALES FEMALES *** * * * * * ******* 0 10 20 40 60 33,042 71,344 132,595 161,997 48,463 40,056 86,478 132,628 124,385 64,235 Comment: T h i s m e t h o d o l o g y i m p l i c i t l y a ssumes t h a t m a x i m i z a t i o n o f GNP i s t h e s o l e o b j e c t i v e o f e c o n o m i c p o l i c y . M i s h a n 1 2 3 a r g u e s s u c h i s n o t t h e c a s e a nd j u s t i f i e s h i s a r g u m e n t by t h e f a c t t h a t most c o u n t r i e s p e r m i t o n l y l i m i t e d i m m i g r a t i o n w h e r e a s an u n l i m i t e d i m m i g r a t i o n p o l i c y w o u l d a c t u a l l y be c o n s i s t e n t w i t h m a x i m i z i n g GNP. I t i s c o n c e i v a b l e t h a t an i n d i v i d u a l ' s l i f e c o u l d be v a l u e d a t z e r o d o l l a r s u n d e r t h e g r o s s p r o d u c t i o n a p p r o a c h a n d a c t u a l l y l e s s t h a n z e r o d o l l a r s u n d e r t h e n e t p r o d u c t i o n a p p r o a c h . T h i s w o u l d s u g g e s t t h a t s o c i e t y w o u l d be b e n e f i t t e d by t h e d e a t h s o f h a n d i c a p p e d , r e t i r e d , a n d c h r o n i c a l l y u n e m p l o y e d p e r s o n s , a p r e m i s e t h a t i s n o t a c c e p t a b l e i n o u r c u l t u r e a t t h i s p o i n t i n t i m e . The m e t h o d o l o g y 2 2 THE COSTS OF ROAD ACCIDENTS AND THEIR APPLICATION I N THE ECONOMIC EVALUATION OF SAFETY PROGRAMS J.J.LAWSON - f r o m R.T.A.C. FORUM v o l . 2 no.4 ( 1 9 8 0 ) 1 2 3 C/B ANALYSIS - 1976 - E.J.MISHAN 1 45 a l s o ignores the value the i n d i v i d u a l himself may place on h i s a b i l i t y to remain a l i v e and allows no compensation for the l o s s of l e i s u r e time, a resource that i s a l l o c a t e d some value i n other areas of economic theory. 2. Previous D e c i s i o n s : A value of l i f e can be imputed from past d e c i s i o n s of i n f l u e n t i a l members i n s o c i e t y . For example: - court awards won by dependants of i n d i v i d u a l s who have l o s t t h e i r l i v e s in i n d u s t r i a l , auto, or other accidents - past a l l o c a t i o n s from government safety programs designed to reduce or el i m i n a t e the r i s k of death Comment: Court settlements g e n e r a l l y attempt to compensate one or a l i m i t e d number of persons for the death of another. This i s not g e n e r a l l y a good measure of what the cost to a l l of so c i e t y i s as a r e s u l t of the death. The value of l i f e i mplied from court settlements and e s p e c i a l l y government a l l o c a t i o n s to various safety programs are extremely v a r i a b l e and require researchers to s u b j e c t i v e l y pick one of the implied values . F i n a l l y the approach i s somewhat c i r c u l a r i n that i f e r r o r s were made i n the past they w i l l be c a r r i e d on i n t o the 1 46 f u t u r e . 3. R e v e a l e d P r e f e r e n c e s : I n d i v i d u a l s o f t e n make c o n s c i o u s o r s e m i - c o n s c i o u s d e c i s i o n s w h i c h i n v o l v e t h e t r a d e - o f f b e t w e e n r i s k o f d e a t h a n d money, t i m e , c o m f o r t , o r some o t h e r c o m m o d i t y on w h i c h t h e y p l a c e some v a l u e . By a n a l y z i n g t h e s e d e c i s i o n s , r e s e a r c h e r s a t t e m p t t o i m p u t e a p e r s o n ' s w i l l i n g n e s s t o pay f o r a u n i t o f r i s k r e d u c t i o n , a n d f r o m t h i s i n f o r m a t i o n a v a l u e o f l i f e i s e s t i m a t e d . F o r e x a m p l e , M e l i n e c k ( 1 9 7 4 ) s t u d i e d t h e d e c i s i o n m a k i n g o f i n d i v i d u a l s who h a d t h e c h o i c e o f u s i n g a p e d e s t r i a n t u n n e l t o c r o s s a h i g h w a y o r c r o s s i n g a t g r a d e a nd a s s u m i n g t h e i n h e r e n t r i s k o f b e i n g h i t and p o s s i b l y k i l l e d by a v e h i c l e . Comment: P e o p l e a r e o f t e n u n a b l e t o c o r r e c t l y p e r c e i v e t h e m a g n i t u d e o f t h e r i s k t h e y a r e a s s u m i n g when t h e y a r e c o n f r o n t e d w i t h a l t e r n a t i v e c o u r s e s o f a c t i o n . A l s o , t h e m a r g i n a l d i s u t i l i t y o f t h e r i s k o f d e a t h i n c r e a s e s a s a f u n c t i o n o f t h e m a g n i t u d e o f t h e r i s k , i t c a n n o t be assumed a l i n e a r f u n c t i o n . A v a r i e t y o f o t h e r f a c t o r s may i n f l u e n c e t h e p e r s o n ' s d e c i s i o n m a k i n g s u c h a s l e g i s l a t i o n i n t h e c a s e o f s e a t b e l t u s e and d r i v i n g s p e e d s a nd 1 47 an a c t u a l d e s i r e f o r some d e g r e e o f r i s k i n t h e c a s e o f a p e r s o n ' s c h o i c e o f o c c u p a t i o n . F i n a l l y , t h e p r o b a b i l i t y o f i n j u r y u s u a l l y a c c o m p a n i e s t h e r i s k o f d e a t h a n d t h i s f a c t o r must be removed b e f o r e t h e i m p l i c i t l y d e t e r m i n e d v a l u e o f l i f e c a n be e s t a b l i s h e d . A l t h o u g h c h a n g e s i n n a t i o n a l p r o d u c t a r e n o t c o n s i d e r e d a d e q u a t e m e a s u r e s o f s o c i a l w e l f a r e , t h e n e t f o r g o n e p r o d u c t i o n a p p r o a c h was u s e d i n v a l u e o f l i f e d e t e r m i n a t i o n i n G r e a t B r i t a i n u n t i l 1970. S u b s e q u e n t t o t h a t y e a r , t h e n e t p r o d u c t i o n a p p r o a c h was d r o p p e d i n f a v o u r o f t h e g r o s s f o r g o n e p r o d u c t i o n a p p r o a c h a n d some c o m p e n s a t i o n was i n c l u d e d f o r m e d i c a l c o s t s , g r i e f , s o r r o w , e t c . A d j u s t e d t o 1984 d o l l a r s , t h e v a l u e p l a c e d on l i f e by t h i s m ethod i s : F o r e g o n e P r o d u c t i o n M e d i c a l , A m b u l a n c e , P o l i c e , a n d Damage P a i n , G r i e f , a n d $ 144,300 43,400 67% 2% S u f f e r i n g 67,460 3 1 % ********** $ 215,160 100% * * * * * * * * * * The f i g u r e recommended f o r t r a f f i c s a f e t y r e l a t e d b e n e f i t / c o s t a n a l y s e s by t h e U n i t e d S t a t e s N a t i o n a l S a f e t y C o u n c i l i n 1973 was $37,500. A f i g u r e o f t h i s 1 48 ' m a g n i t u d e was u s e d by P u b l i c Works Canada i n t h e i r e v a l u a t i o n o f t h e A l a s k a H i g h w a y u p g r a d i n g p r o g r a m . C o n t e m p o r a r y t h i n k i n g by t h o s e i n r e l a t e d r e s e a r c h a p p e a r s t o be t h a t t h e s e f i g u r e s a r e t o o low and t h e m e t h o d o l o g i e s upon w h i c h t h e y a r e b a s e d p o o r l y j u s t i f i e d . T h o s e v a l u e s o f l i f e d e r i v e d f r o m f o r g o n e p r o d u c t i o n a p p r o a c h e s a r e c o n s i d e r e d t o be t h e l o w e r l i m i t s o f t h e a c t u a l v a l u e o f l i f e . S t u d i e s w h i c h a t t e m p t t o e s t i m a t e s o c i e t y ' s " w i l l i n g n e s s t o p a y " f o r r e d u c t i o n s i n t h e p r o b a b i l i t y o f d e a t h y i e l d v a l u e s w h i c h a r e s u b s t a n t i a l l y h i g h e r t h a n t h o s e l o w e r l i m i t s . The u p p e r l i m i t c o u l d p r o b a b l y be d e f i n e d a s t h a t v a l u e an i n d i v i d u a l e x p l i c i t l y p l a c e s on r i s k r e d u c t i o n , by u s e o f t h e d i r e c t e n q u i r y a p p r o a c h . I n f o r m a l s u r v e y s o f p r o f e s s i o n a l p e o p l e i n t h e 30 t o 50 y e a r r a n g e were c o n d u c t e d by J o k s h i n 1975. He d e r i v e d v a l u e s o f l i f e t h r o u g h t h e i r s t a t e d w i l l i n g n e s s t o pay f o r t h e c o m p l e t e e l i m i n a t i o n o f f a t a l i t y r i s k w h i l e c o m m u t i n g o f b e t w e e n 2 a n d 11 m i l l i o n d o l l a r s ( a d j u s t e d t o 1984 d o l l a r s ) . The q u e s t i o n r e m a i n s a s t o what v a l u e o f l i f e one s h o u l d a p