Monday, May 8, 2017

Highway 3 twinning study released - benefits outweigh costs

Highway 3 east of Highway 6 intersection
C. Davis file photo
“This report is good news for southern Alberta and the Association believes that twinning of highway 3 is integral to the economic development, tourism, recreational use, and safety of the Highway 3 Corridor. This study confirms the investment is valued and sustainable." - Highway 3 Economic Development Association President Bill Chapman
C. Davis/T. Lucas - A report prepared for the Highway 3 Twinning Development Association by University of Lethbridge Department of Economics Professor Kien C. Tran, Ph.D. was completed on April 22 2017 and unveiled to the public on May 5. The report "presents the results of an economic feasibility analysis to determine the costs and benefits associated with twinning construction of the remaining (approximately) 220 kilometers of Alberta Highway 3 known as Crowsnest Pass Highway. The main benefits that accrue from twinning Highway 3 include not only for safety improvement/time saving but also for increase in social/economic activities, tourism and agricultural needs." According to Tran's report, the results of the report's cost-benefit analysis "shows that for each dollar spent on this project, there is $2.97 in benefits which translates into the internal rate of return of 12.3%. Consequently, for a public infrastructure investment, these results are highly significant and demonstrate the worthiness of the twinning investment project."

On May 8 Town of Pincher Creek Mayor Don Anderberg told his council about the report at their regular meeting. "The long and the short of it is this... 'Twinning would return $3 in economic benefits for every $1 spent on Highway 3'."  He said there is no conjecture in the report, it is based on facts and statistics.  "It is a really, really conservative report."

"Over a 20 year period the economic benefits exceed construction costs by over 2 billion dollars...based on existing data."

According to the report, "From an economic perspective, the assessment of uncertainty in the forecast proves further worthiness of the investment. Given the assignment of probabilities of all technical assumptions that were used in generating the forecasts and with two standard discount rates that are recommended by the Alberta Transportation (AT) and the Canadian Federal Treasury Board (CFTB), the tables below show that the Highway 3 twinning project offers the public over 90% assurance of generating more benefits than costs."

According to the Government of Alberta, "approximately 115 of the 325 kilometres of Highway 3 are twinned between Fort Macleod and Taber." More comprehensive twinning of the highway has been a major issue for the communities along Highway 3 for many years.

According to their website, the Highway 3 Economic Development Association "works collectively, on behalf of member municipalities, chambers of commerce, school boards, tourist associations and economic development agencies to promote and work with government to facilitate the twinning of Highway 3."  From their May 5 press release: "The Cost Benefit Analysis has determined that the twinning of Highway 3 generates an economic return of about 3:1 in that for every dollar invested in the maintenance and construction of the highway, about three dollars in benefits result. In addition, public safety is improved and a reduction in emissions occurs as a result of twinning the highway.:

Twinning Highway 3 was designated as a priority in the Government of Alberta's 20 year capital plan in 2008. On June 22, 2016 the government announced it was investing nearly $10,000 for an updated cost-benefit study related to twinning Highway 3, with the funding to go to the Highway 3 Twinning Development Association to update a 2002 Van Horne Institute study, which "examined the estimated cost of the twinning project and the economic benefits to the southeastern region if Highway 3 were twinned from Medicine Hat to the British Columbia border." 

According to Lethbridge-East MLA Maria Firzpatrick, Minister of Transportation and Infrastructure Brian Mason came to Lethbridge in March of 2016 and met with the association. As part of the government's 2016 announcement Mason said “Alberta’s transportation network is vital to our economy, facilitating trade and connecting people and communities. Highway 3 is a key piece of this network, and I’m pleased to bring this important study forward.”

From the 2017 report: "The idea of twinning Highway 3 has been previously discussed, and the costs and benefits study have been conducted by the Van Horne Institute, at the University of Calgary under the direction of Dr. Frank J. Atkins in 2002 and 2004 (revised report). The results from the final report show that the benefit-cost ratios vary from 3.03 (using 10% real discount rate) to 3.65 (using 4% real discount rate) indicating the highway 3 twinning is a worthy investment. Those benefit calculations were based on differences between real gross domestic product (GDP) forecasts with and without highway capitals for Southern Alberta region (economic activities)."

The report looked at "traffic volumes, tourism, pattern and flows, economic and demographic data for the study area" from Fort Macleod to Crowsnest Pass, Waterton Lakes National Park, and from Taber to Medicine Hat)."  A cost-benefit analysis was developed which included direct costs associated with twinning construction and operations, maintenance and rehabilitations costs thereafter, travel time cost savings, accident cost savings, vehicle operating cost and emission cost savings, and ourism, commercial catchment basin and local trade area effects.

Member municipalities of the Highway 3 Economic Development Association include Town of Pincher Creek, MD of Pincher Creek, Municipality of Crowsnest Pass, Fort Macleod, Coaldale, Lethbridge, Taber, and Medicine Hat.

From the report:

"Alberta Provincial Highway No. 3, commonly known as Highway 3, with its entire length of 324 kilometers (201 miles), is a highway that transverses southern Alberta, Canada, connecting the Crowsnest Pass to the Trans-Canada Highway in Medicine Hat, and it serves as an alternative route to the Trans-Canada from Lower Mainland to the Canadian Prairies1. Highway 3 in Alberta begins in the Canadian Rockies at Crowsnest Pass, parallel to the Canadian Pacific Railway. It winds through the foothills of southern Alberta past Pincher Creek to a major junction at Highway 2 west of Fort Macleod where it becomes a divided highway and part of Alberta’s “Export Highway” - a name given to the southern portion of Alberta’s north-south trade corridor which is a segment of the CANMEX Corridor that stretches from Alaska to Mexico. The divided Highway then curves northeast to Monarch where it crosses the Oldman River and meets Highway 23 before bending back southeast. It bisects the city of Lethbridge as an expressway named Crowsnest Trail that carries nearly 35,000 vehicles per day, the busiest section of the highway2. Crowsnest Trail marks the northern termini of Highways 4 and 5; the former is a major route that assumes the designation of the Export Highway, connecting to Interstate 15 in Montana, whilst the latter branches south west to Magrath and Cardston. Continue east alongside the railway and Highway 3 passes through Coaldale en route to Taber, after which the divided highway reverts to a two-lane that carries past farmland into Cypress County. The highway ends at the Trans-Canada Highway (Highway 1) in Medicine Hat."

According to Alberta Transportation, "Highway 3 from the Crowsnest Pass, at the BC border to Highway 1 (TransCanada Highway) in Medicine Hat a distance of 320 km, is a designated future freeway within the National Highway System. Alberta Transportation has identified improvements and protection measures required to implement freeway designation for this corridor. Corridor management and functional planning studies to identify alignments, access links, corridor protection measures and costs have been commissioned since 2005."

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