Engineering Economics for Transportation

Prerequisite for “Public Works Program Administration and Infrastructure Investment Analytics”

Course Overview

This workshop introduces core engineering economics principles tailored to transportation infrastructure planning and investment. It equips participants with the economic evaluation tools needed for data-driven decision making in public works and transportation projects.

Target Audience

Transportation and civil engineers; public works and infrastructure planners; asset management professionals; graduate students in transportation engineering or planning; local, state, and federal agency staff.

Learning Objectives

By the end of the workshop, participants will be able to:

1. Explain fundamental economic concepts relevant to transportation infrastructure.

2. Apply time value of money principles to evaluate projects.

3. Use benefit-cost analysis to compare project alternatives.

4. Integrate risk and uncertainty into economic decision making.

5. Lay the groundwork for advanced investment analytics in public works program delivery.

Workshop Structure

• Duration: 1 day (8 hours)

• Format: In person or virtual, live workshop

• Methods: Lecture, worked examples, case-based exercises, and group discussion

Workshop Draft Agenda

Session 1: Introduction to Engineering Economics in Transportation

• Role of economics in transportation decision making

• Balancing technical feasibility with economic viability

• Examples from recent transportation projects

Session 2: Time Value of Money

• Present value, future value, and discounting

• Nominal versus effective interest rates

• Application to transportation asset life-cycle costing

Session 3: Life-Cycle Cost Analysis (LCCA)

• Defining life-cycle costs for transportation assets

• Maintenance, rehabilitation, and replacement cost considerations

• Example: pavement management investment analysis

Session 4: Benefit-Cost Analysis (BCA)

• Identifying and quantifying transportation benefits

• Direct and indirect benefits (safety, time savings, emissions reduction)

• Step-by-step BCA example for a roadway safety improvement

Session 5: Economic Evaluation of Alternatives

• Comparing mutually exclusive, independent, and interdependent projects

• Incremental BCA for alternative design options

• Case study: selecting a bridge replacement strategy

Session 6: Dealing with Risk and Uncertainty

• Sensitivity analysis

• Probabilistic approaches (scenario planning, Monte Carlo basics)

• Risk-adjusted discount rates for transportation investments

Session 7: Funding and Financing Concepts

• Federal, state, and local funding streams

• Public-private partnerships (P3/PPP)

• Leveraging grants, bonds, and innovative financing

Session 8: Applied Group Exercise — Transportation Project Economic Assessment

• Teams analyze a provided project with cost estimates, benefit data (travel time savings, crash reduction, operating costs), and funding constraints

• Deliverable: short presentation on the economically preferred option

Session 9: Wrap-up and Q&A

Materials Provided

• Slide deck with formulas and examples

• Economic analysis worksheets (Excel)

• Sample BCA templates

• Case study datasets

• Reference reading list

Students who complete this non-credit course will receive 6 PDHs (Professional Development Hours) issued by the Maryland Board for Professional Engineers.

Note: CEU is a general term for continuing education units. The continuing education units this course offers are not issued by the University of Maryland.