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QUESTION 7 (15 points): The city of College Station is determining whether to make the Bush-Wellborn overpass dream a reality. Initial estimates put the project
QUESTION 7 (15 points): The city of College Station is determining whether to make the Bush-Wellborn overpass dream a reality. Initial estimates put the project cost at S$25M. Studies suggest the intersection hosts S0K vehicles a day (averaged throughout the year), anticipated to increase by 40% once construction is complete. This includes an anticipated increase of 48K people per year in public transportation passengers, adding $4.75 per passenger to city coffers from additional fares. Interestingly, analyses show the costs to increase public transportation services is offset by the fuel costs saved from its busses not having to wait at a standard intersection and will net $2.82 per passenger in additional advertising revenue. The economic planning factors predict a benefit of 12 cents per vehicle transiting the city, but an additional carbon tax of 0.2 cents per vehicle; fortunately, the green elements of the overpass design will cut that tax in half. Transportation sustainment modeling demands 0.5 cents per vehicle for annual infrastructure repair. Given the overpass' expected life is 20 years, Union Pacific Railroad (UPRR) has volunteered to subsidize the S5M of the construction as it the overpass will allow it to increase its freight volume while simultaneously increasing the level of safety by removing the vehicle crossing. Given Chancellor Sharp's fiscal savvy, the city has secured a generous 4.5% interest rate on the initial loan, and is planning to use reclamation technology pioneered by Texas A&M's Civil Engineer Department to reuse the concrete and steel from the overpass supports and recover approx. 17% of the initial project investment. a. Should the city proceed with this project
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