Evaluation of Life-Cycle Cost Analysis Practices Used by the Michigan Department of Transportation

Abstract

Life-cycle cost analysis (LCCA) has become a common practice in road construction at the state level during the past decade in the United States. It enables pavement engineers to conduct a comprehensive assessment of long-term costs, and ideally agency highway funding can be allocated more optimally. Michigan Department of Transportation (MDOT) has adopted LCCA in the pavement selection process since the mid-1980s, yet its application in actual projects has not been reviewed. Using case studies, this paper seeks to analyze MDOT’s accuracy in projecting the actual costs over the pavement service life and choosing the lowest-cost pavement alternative. Ten highway sections in Michigan were chosen and grouped into four case studies. Their estimated and actual accumulated costs and maintenance schedules were compared. While results indicate that MDOT LCCA procedure correctly predicts the pavement type with lower initial construction cost, actual costs are usually lower than estimated in the LCCA. This outcome may be partly because the cost estimation module in MDOT’s model is not site specific enough. Refinements to its pavement construction and maintenance cost estimating procedures would assist MDOT in realizing the full potential of LCCA in identifying the lowest cost pavement alternatives for the pavements studied.