Infrastructure and a country’s competitiveness go hand in hand. A country cannot effectively compete in today’s global markets without movement of people, goods and services. Every country needs a safe, reliable and an effective movement of goods and services if they need to drive their economy. Products have to be available to customers when they need them. When this is in place, there is movement of money since the dollars get back to the pockets of investors (Fernie & Leigh, 2009, pg. 38). New Jersey like every other state, places a lot of importance on their infrastructure. The state realizes that an effective infrastructure is vital to their economy, environment and health. The state has a wealth of professions in the industry with over 4,000 professional civil engineers living and working in the state.
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A report released by the American Society of Civil Engineers (ASCE) New Jersey section grades the state’s infrastructure as mediocre (American Society of Civil Engineers, 2009). The grading system is done putting into consideration a state’s state of repair and quality of life. The New Jersey infrastructure report card concluded that the state has poor waste-water infrastructure, mediocre drinking water systems, mediocre dams, energy systems, parks, and recreation infrastructure. The state’s ports and navigable waterways were also ranked as mediocre, while the roads and bridges were ranked as poor (American Society of Civil Engineers, 2009). In conclusion, the report gave New Jersey a C grade which stands for a mediocre state of infrastructure. It also recommended that it is critical that the state put in place solid plans to develop and maintain a modern infrastructure. This is especially in consideration of the fact that the state has one of the fastest growing population.
For new Jersey to fully understand the importance of developing infrastructure, they need to put into consideration some factors. They need to critically analyze all types of impacts on its residents and do so on both short and long term basis. A proper framework for evaluating the impacts of infrastructure investment would have to include costs and benefits, effects on households, businesses and governments as consumers and producers, and short and long term outcomes (Transit Cooperative Research Program,2002, pg. I-8). The state needs to consider the following:
- Impacts: the state needs to consider the impacts of undertaking infrastructure projects. The impacts in consideration should go beyond transit and look at other areas that would be impacted such as the environment. Infrastructure impacts the quality of life, the state’s economic development, and everything else that citizens interact with in their day to day lives.
- People: when trying to understand the benefits of developing infrastructure, people refer to not just travelers but every person who is impacted by the activities enabled by good roads. People in this case include suppliers, distributors, consumers, travelers and the society at large. The whole society is affected by how goods and services travel, how money exchanges hands as a result of trade and how easily they can access different services in different locations. Major interest groups include businesses and the government.
- Time: The impacts of a good infrastructure will be felt in different durations of time. It is important that New Jersey is able to analyze both short and long time goals that would result from infrastructure development. They also need to analyze the negative effects that would result from poor infrastructure now and in the long term. Weighing the two will give the state a clearer picture of just how important infrastructure is to them.
Steps for evaluating full benefits of transit
The first step towards evaluating full benefits of infrastructure is identifying policy or investment options. This is done by transit analysts at the beginning of every project. The main reason for investing in infrastructure is to improve the performance of the economic and social systems. Thus, it is important that the state of New Jersey starts with a description of benefits and costs, and relate them to the direct cost of investment. Since the direct costs of transit development are not hard to enumerate, it makes the step much easier. Direct costs include the cost of planning which is the first step, design, construction which is the most expensive, operation and finally the cost of maintaining the infrastructure when it is done.
The second step is describing the scope of the analysis. New Jersey, with the help of experts needs to be aware and clearly state the types of impacts likely to be significant and which need to be evaluated. There is also needs to have clear knowledge on the levels of measurement and evaluation desired for the projects and availability of the expertise to do so. Infrastructure has an impact on different aspects of a state. It is bound to affect New Jersey’s economic levels, the environment, population growth, food security and many other economic, political, environmental and social factors. By classifying categories of impacts, the state will have the ability to measure and monetize the impacts. A good example is measuring how much time an average transit user will save as a result of improved infrastructure. The time measurement and evaluation can then be quantified in monetary value.
The third step is making measurements of the significant impacts to an extent as large as possible. The measurements should be disaggregated over, time, geographical, and interest groups (Transit Cooperative Research Program, 2002, pg. I-9). Distribution of impacts, which is important to decision making, must then have fairness of equity. Converting them into dollars will then allow the state monetize the benefits as well as the costs. It is then possible to compare the costs and the benefits to determine the viability of the initiative and how much economic value it makes to the state of New Jersey. Looking at the future stream of monetary benefits of an initiative, it is possible to present its value to all the stakeholders including the residents of New Jersey.
The fourth step is measuring and discussing non-monetary benefits and costs. Infrastructure development comes with environmental degradation, sometimes relocation of residents and changes in different business. It also comes with many positive impacts such as ease of movement. Conducting sensitivity analysis will enable New Jersey predict how the different changes will affect their expected outcomes. Combining the analysis of both quantifiable and non-quantifiable effects and their impacts will definitely give New Jersey the suitable preference.
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The four steps are very critical in the final decision making process and need to be carried out effectively and professionally. Even after the state has gone through them and is certain on their decision, they need to put into consideration the fact that some benefits or impacts can only be established when the project is ongoing or complete. It is therefore important for them to leave room in their approximations for those negative impacts as well as benefits which may not be anticipated. A good example is accidents which might occur during construction in the case of road construction.
American Society of Civil Engineers.(2009). New Jersey Infrastructure Report Card. Web.
Fernie, J., & Leigh, S. (2009). Logistics & retail management: Emerging issues and new challenges in the retail supply chain. London; Philadelphia: Kogan Page Ltd.
Transit Cooperative Research Program. (2002). Estimating the benefits and cost of public transport projects: A guidebook for practitioners. Washington, D.C.: National Academy Press.