Role of BCA in TIGER grant reviews: common errors and influence on the selection process

As directed by the American Recovery and Reinvestment Act of 2009, the US Department of Transportation (DOT) created the Transportation Investment Generating Economic Recovery (TIGER) discretionary grant program for surface transportation infrastructure projects. Through 2013, there have been five rounds of the grant program. TIGER uses a multi-step competitive application process to award surface transportation funds. TIGER applications are initially screened by US DOT’s staff of technical experts. For projects forwarded by the review team, US DOT economic experts then review the applicant’s benefit-cost analysis (BCA) and attempt to determine the likelihood that the benefits exceeded costs (i.e. not the applicant’s self-determination). The final awardees are then selected by a Review Team of Modal Administrators and DOT Office of the Secretary level officials. The purpose of this paper is to discuss many of the common errors in preparing, and issues in reviewing the applicant’s BCA and in making a net benefit determination. A secondary purpose is to determine if the most deserving projects, based on an applicant’s BCA and the likelihood that benefits exceeded costs, are more likely to receive grant funding. We do so for the second through the fifth rounds of the program.