Life Cycle Costs of the Little Cottonwood Canyon Transportation Scenarios under Varied Economic Conditions and Analysis Periods

This study revisits the life cycle cost analysis (LCCA) of the Utah Department of Transportation’s (UDOT) proposed gondola project, using recommended best practices for selecting the discount rate, life cycle periods, and conducting a sensitivity analysis on cost projections. We reanalyze the life cycle costs of the five alternatives in the Environmental Impact Statement (EIS) (Scenario 1) across different economic scenarios, and subsequently, we re-analyze the life cycle costs of the Scaled Enhanced Bus (Scenario 2) and Enhanced Bus to Gondola (Scenario 3) from UDOT’s Revised LCCA, using construction dates in the record of decision (ROD) and considering various economic scenarios and study periods. We estimate that the Scaled Enhanced Bus (Scenario 2) is less expensive than the Enhanced Bus to Gondola (Scenario 3) in eleven of the twelve economic scenarios and analysis periods analyzed. Additionally, increased risk of cost overruns of building the Gondola and ongoing litigation related to the Little Cottonwood Canyon EIS introduces further uncertainty into the estimated life cycle costs and the project’s feasibility. While UDOT may recommend Scenario 3 (Enhanced Bus to Gondola) for reasons beyond cost, such as reliability, we believe that it is inaccurate for UDOT to state that Scenario 3 is the least costly option for providing transportation services to Little Cottonwood Canyon. We recommend utilizing best practices in conducting life cycle analysis for large and complex transportation projects such as the Little Cottonwood Canyon.