This study sought to explore the cost-effectiveness of Otta seals as an alternative surface treatment to chip seal, a treatment similar to Otta seal in many ways and currently a popular bituminous surface treatments (BST) in the United States

1. Department of Civil, Construction and Environmental Engineering (CCEE)
Program for Sustainable Pavement Engineering and Research (PROSPER)
Institute for Transportation (InTrans), Iowa State University (ISU)
March XX, 2018
Project PI: Halil Ceylan
Co-PIs: Charles T. Jahren, Douglas D. Gransberg, and Sunghwan Kim
Research Associate: Yang Zhang
Research Assistants: Ali Nahvi
TR-674 Evaluation of Otta Seal Surfacing for
Low-volume Roads in Iowa: Life-Cycle Cost
Analysis for Otta Seal Surface Treatment

2. Acknowledgments
• TAC: Iowa County Engineers and Iowa DOT Engineers
– Paul Assman, Crawford County
– Brandon Billings, Cherokee County
– Lee Bjerke, Winneshiek County
– Scott Cline, Jefferson County
– Zach Gunsolley, Ringgold County
– Brian Keierleber, Buchanan County
– James D. King, Page County
– Patrick Mouw, Ida County
– Joshua Sebern, Guthrie County
– David Shanahan, Mahaska County
– Danny Waid, Iowa County Engineers Service Bureau
– Vanessa Goetz, Iowa DOT
– Francis Todey, Iowa DOT
2

3. Acknowledgments (Cont’d)
• Winona County Engineers Office, Minnesota
– Troy Drath, Winona County
• Blacktop Services, Inc.
– Scott Rinehart
• Fahrner Asphalt Sealers, LLC.
– Dan Hollar
• Norwegian Public Roads
– Charles Overby, Chief Engineer
• ISU
– Cahit Gurer, Visiting Assistant Professor
3

4. Outline
• TR-674 Objectives and Research Plan
• Economic Analysis of Case Study I: Otta Seal Vs. Chip
Seal
• Economic Analysis of Case Study II: Otta Seal Vs.
Gravel Road
• Summary
4

5. TR-674 Objectives
• Evaluate the cost-effectiveness and performance of Otta seals
compared to traditional bituminous seal coat surfaces, and
compared to maintenance of granular surfaced roads
• Evaluate the feasibility of Otta seals as an alternative surface
treatment on low volume roads using local aggregate
• Identify local projects that can be sites for field demonstration to
represent a range of locally available aggregate in different areas of
the state
• Evaluate Otta seal performance through seasonal changes (i.e.,
winter, spring/thaw, summer), environment, and traffic loading
conditions through laboratory testing and field demonstration
5

6. Overview of TR-674 Research Plan
• Task 1: Literature review
• Task 2: Identify sites for field demonstration
• Task 3: Develop field demonstration plan
• Task 4: Evaluate field performance
• Task 5: Economic analysis
• Task 6: Develop draft construction guidelines
• Task 7: Prepare final report
• Task 8: Final report and presentation
6

7. Outline
• TR-674 Objectives and Research Plan
• Economic Analysis of Case Study I: Otta Seal Vs. Chip
Seal
• Economic Analysis of Case Study II: Otta Seal Vs.
Gravel Road
• Summary
7

8. Case Study I: Otta Seal Vs. Chip Seal
8
MN74, Winona County, MN - Length:
1.4 miles & Construction Year 2001

9. Objectives and Scope
• This study sought to explore the cost-effectiveness of
Otta seals as an alternative surface treatment to chip
seal, a treatment similar to Otta seal in many ways and
currently a popular bituminous surface treatments (BST)
in the United States
• Minnesota has implemented Otta seal as a BST in many
projects, providing the study with access to the historical
cost records needed to complete this study
• The objective of this study was to evaluate the financial
viability of Otta seal through a stochastic life-cycle cost
analysis (LCCA) conducted for Minnesota and Iowa
9

10. Approach/Methods
10
Data collection
Publicly available data
Cost estimation Developing LCCA framework
Monte Carlo simulation based Life cycle
cost analysis framework
Stochastic sensitivity analysis

11. Cost Estimation
• One cost estimation approach would be to use bid tabs to
create unit cost estimates (Cost estimation approach used for
Minnesota)
• Another approach that was attractive due to limited Otta seal
bid data in Iowa, was to break down the initial cost into
specific items, such as aggregate or transportation (Cost
estimation approach used for Iowa)
11
Bid data
Cost breakdown

12. Cost Estimation: Bid Data
• Cost estimation approach for Minnesota
– The initial construction cost of BST was obtained from
Minnesota bid tabs that are publicly available
– Bid data provide a simple, reliable, and quick method for
estimating unit costs
– The data set used in this analysis contained bid records
obtained over the previous two-year period (September
2015 to August 2017)
12

13. Cost Estimation: Bid Data (Cont’d)
• The mean values of unit costs for double Otta seal projects is much
less than for double chip seal
• According to discussions with contractors and Minnesota county
engineers, the main reason for this significant difference between
unit prices of chip seal and Otta seal lies in the cost of hauling
aggregate from aggregate producers’ storage areas to job sites
• In some chip seal cases the hauling distance would be more than
200 miles
• Also, since Otta seal has no restricted requirement for aggregate
gradation, using local aggregate for Otta seal surfacing would be a
viable option that could result in aggregate production and haulage
cost reduction, reducing construction unit cost accordingly
13

14. Cost Estimation: Cost Breakdown Approach
• Cost estimation approach for
Iowa
– Chip seal and Otta seal follows the
similar work breakdown structure
(WBS)
– The main sources of difference
between initial costs of both
methods are binder, aggregate, and
the cost of hauling aggregate from
producer companies to jobsites
– The costs of these items were
determined from U.S. Bureau of
Labor Statistics (BLS) data and
quarterly cost reports in
Engineering News Record 14
Life-cycle cost
Initial cost Future costs
Binder
Aggregate
Transportation

15. Cost Estimation: Cost Breakdown Approach
(Cont’d)
• Initial installation costs of surface treatment methods were broken
down into specific commodities such as aggregate, transportation,
and binder
• The aggregate application rate
– Approximately 50 lb/yd2 for Otta seal
– Approximately 35 lb/yd2 for chip seal
• A maximum aggregate size
– 0.50 to 1.00 inch in previous Minnesota Otta seal projects
– 0.39 up to 0.50 inch in chip seal construction
• The asphalt binder application rate
– Approximately 0.5 gal/yd2 for Otta seal
– Approximately 0.35 gal/yd2 for chip seal
15

16. Cost Estimation: Historical Cost
• Historical cost of commodities during last five years
for one square yard of Otta seal and chip seal
16
Costs of graded aggregate for chip seal and MN class 5 for
Otta seal
USD/yd2
USD/yd2
Costs of asphalt binder for chip seal and Otta seal
Chip seal
Otta seal
Chip seal
Otta seal

17. Cost Estimation: Historical Cost (Cont’d)
• The aggregate hauling rate per mile for the last five
years in the state of Iowa was obtained from the U.S.
Bureau of Labor Statistics (BLS) data
17
USD/mile
Hauling aggregate rate per mile for each truck load 8 metric ton

18. Cost Estimation: Historical Cost (Cont’d)
• Transportation cost is location-dependent and varies
from one project to another
• Three different scenarios for representing
transportation cost were evaluated
18
Distance from job site (one way):
Truck load: 8 U.S. ton
Low Most-likely High
Chip seal 50 100 150
Otta seal 5 10 20

19. Cost Estimation: User and Future Costs
• FHWA Pavement Division 1998: “If a pavement
treatment is expected to incur costs, such as
maintenance, comparable to the costs of other
alternatives and will not have a material effect on
the output, they can be treated deterministically or
ignored altogether”
19

20. Cost Estimation: User and Future Costs
(Cont’d)
• All maintenance costs associated with the roads are
assumed to be the same for both alternatives
• In addition, since typical average daily traffic will be
quite low, costs associated with traffic control during
construction and maintenance were not considered
in this study
20

21. LCCA Methodology
• Stochastic and deterministic Life-Cycle Cost Analysis
(LCCA) approaches were employed to compare
competing design alternatives
• The specific approach used in this study utilizes
equivalent uniform annual cost (EUAC) analysis,
permitting elimination of many assumptions required
when using the more common, and more
problematic, net present worth LCCA
21

22. LCCA Methodology (Cont’d)
• Deterministic EUAC, the traditional method used for decision-making in
pavement management, involves using point estimates that result in a
single output value
• The outcome of a deterministic LCCA depends on numerous estimates,
forecasts, assumptions, and approximations, with each factor having some
potential to introduce error into the results
• The degree of uncertainty associated with each alternative is itself a factor
to be considered when selecting among competing alternatives
• Although deterministic economic analysis might provide some insight into
output variability when deterministic LCCA is employed with conjugation
of sensitivity analysis, it is inadequate for application with any degree of
confidence to highly-volatile construction materials
22

23. LCCA Methodology (Cont’d)
• The issues associated with a
deterministic EUAC model, like
sensitivity to discount rate or volatility
of underlying commodity prices, could
be addressed by developing a
stochastic life-cycle cost model
• A stochastic LCCA approach allows
input variables to range across their
more recent historic variations utilizing
a Monte Carlo Simulation (MCS)
• Two MCS models were developed
based on different cost estimation
approaches
23

24. LCCA Methodology (Cont’d)
• Conduct MCS
– The historical unit cost of materials and transportation cost
were replaced with their probability distributions, and the
output was estimated in quantity variation format
24
Initial costs
were fitted to
the best
distribution
and plugged
into the cost
model
Previous twenty year
discount rate data from
Federal Reserve was
obtained and fitted to
the best distribution 0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
3
4
5
6
7
8
9
10
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25. LCCA Results: MCS Outputs
• Probability distribution function (PDF) for different
surface treatment options
25
Single layer chip seal Double chip sealDouble Otta seal

26. LCCA Results: MCS Outputs (Cont’d)
• Stochastic LCCA for the State of Minnesota
– For double Otta seal, the estimate range with a two-tailed 90% confidence
interval ranges from 0.25 USD to 0.33 USD with a median value of 0.29
– The median is a good measure because, regardless of distribution shape,
half the values are above the median and half are below the median
– It can once again be seen that among the alternatives double Otta seal has
the lower median life cycle cost
26
Item EUAC (USD/ yd.2 )
Pavement treatment type
Double Otta
seal
Double chip
seal best fit
(Pareto
distribution
for initial cost)
Double chip
seal with using
triangular
distribution
for initial cost
Single chip
seal best fit
(exact value
distribution
for initial cost)
Single chip
seal with using
triangular
distribution
for initial cost
Mean 0.29 0.44 0.46 0.53 0.54
Standard deviation 0.12 0.72 0.06 0.74 0.06
5th percent 0.25 0.34 0.37 0.42 0.44
95th percent 0.33 0.57 0.55 0.66 0.66
Max 0.36 0.66 0.64 0.75 0.70

27. LCCA Results: MCS Outputs (Cont’d)
• Stochastic LCCA for the State of Iowa
– Similar to previous results, it can be seen that once again
double Otta seal has a lower median life cycle cost among
the alternatives
27
Item EUAC (USD/ yd.2 )
Pavement treatment type
Double Otta
seal
Double chip
seal best fit
(Pareto
distribution
for initial cost)
Double chip
seal with using
triangular
distribution
for initial cost
Single chip
seal best fit
(exact value
distribution
for initial cost)
Single chip
seal with using
triangular
distribution
for initial cost
Mean 0.29 0.44 0.46 0.53 0.54
Standard deviation 0.12 0.72 0.06 0.74 0.06
5th percent 0.25 0.34 0.37 0.42 0.44
95th percent 0.33 0.57 0.55 0.66 0.66
Max 0.36 0.66 0.64 0.75 0.70

28. LCCA Results: Sensitivity Analysis
• Tornado graph
– Another outcome of running a MCS is to determine which
among all the input variables has the greatest potential
impact on the overall EUAC
– Sensitivity analysis result were shown in format of tornado
graph
28
Base case

29. LCCA Results: Sensitivity Analysis (Cont’d)
• Sensitivity analysis results
– The binder cost is in both methods a key factor influencing
the EUAC, and it is anticipated that the EUAC would
decrease significantly as the binder cost decreases
– Another important factor is the sealed layer service life
that is directly related to construction quality
– This highlights the importance of the construction quality
in both sealing methods
2929
0.2 0.3 0.4 0.5 0.6 0.7 0.8
Binder
Service life
Transportation costs
Aggregate cost
Discount rate
EUAC
0.2 0.3 0.4 0.5 0.6 0.7
Binder
Service life
Aggregate cost
Discount rate
Transportation costs
EUAC
Double
chip seal
Double
Otta seal

30. LCCA Results: Sensitivity Analysis (Cont’d)
• Sensitivity analysis results
– Cost of hauling aggregate is the third factor driving
variation in the chip seal life-cycle cost, reflecting the fact
that the life-cycle cost of chip seal is location dependent
– However, since using local aggregate for Otta seal surfacing
would be a viable option, transportation is not a key factor
affecting EUAC
3030
0.2 0.3 0.4 0.5 0.6 0.7 0.8
Binder
Service life
Transportation costs
Aggregate cost
Discount rate
EUAC
0.2 0.3 0.4 0.5 0.6 0.7
Binder
Service life
Aggregate cost
Discount rate
Transportation costs
EUAC
Double
chip seal
Double
Otta seal

31. Summary of Key Findings
• This study uses both deterministic and stochastic LCCA
approaches to evaluate the financial feasibility of using
Otta seal in place of chip seal, with results leading to the
conclusion that the use of Otta seal, a technology based
on the use of local aggregate, would lead to reduction in
transportation and material cost, thereby decreasing
total construction costs
• Since Otta seal technology is already being used
successfully in the state of Minnesota, public agencies
might be inclined to use it to reduce the maintenance
cost of low-volume roads
31

32. Summary of Key Findings (Cont’d)
• Although the analyses results reveal that Otta seal is
more cost effective than chip seal, this conclusion is
limited only to the States of Minnesota and Iowa,
because the relative unavailability of good quality
aggregate in that state cause transportation cost to
be a key factor affecting EUAC for chip seal
• In states where high quality aggregate would be
locally available, the initial cost of chip seal would
probably be significantly reduced
32

33. Summary of Key Findings (Cont’d)
• This study was limited to only cost-effectiveness
evaluation of Otta seal compared to chip seal and did
not investigate the performance aspects of sealed
roads (for example, chip seal exhibits relatively
higher skid resistance is said to reduce incidence of
skid-related accidents)
• Otta seal vs. chip seal is not a black and white choice
and depends on agency and user needs
33

34. Outline
• TR-674 Objectives and Research Plan
• Economic Analysis of Case Study I: Otta Seal Vs. Chip
Seal
• Economic Analysis of Case Study II: Otta Seal Vs.
Gravel Road
• Summary
34

35. Case Study II: Otta Seal Vs. Gravel Road
35
Vs.

36. Objectives and Scope
• This section compares the life cycle cost of surfacing
and maintaining a gravel road with an upgraded
gravel road to Otta seal coated surface
• This study aims to provide a picture for local officials
to decide at what point it is desired to promote a
gravel road to Otta seal coated surface
• This study can be modified and used to address local
conditions
36

37. Approach/Methods
• There were attempts to use historical gravel road maintenance cost
analysis on low-volume roads in Minnesota
• The quality of historical cost analyses are limited by the availability
and quality of historical data
• Due to time limitations, it is unlikely that all the data is recorded by
field forces in the proper categories (MN DOT 2009)
• This was apparent because the data showed that maintenance
activities for bituminous roads were sometimes charged to gravel
roads and vice versa
• Few jurisdictions have historical data
37

38. Cost Estimation: Gravel Road
• The cost estimates for gravel road maintenance
assumed a roadway cross-section as shown here
• The costs estimated include ongoing grading
activities and regraveling every five years
38
24’ Roadway
28’ Top
Shoulder
$$$$$
$$$$$
$$$$$
$$$$$
$ $ $ $
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5

39. Cost Estimation: Gravel Road (Cont’d)
• Assumptions
– One-mile (1.6 Km) long road way with a 24 foot (7.3 m) top
– 2 inches (5 cm) of new gravel is assumed for graveling/ re-
graveling (1,000 yd3 /mile or 1,000 ton/mile- 480 m3/Km)
– Gravel costs approximately $7.00/yd3
– The cost for the motorgrader is 50 USD/hr (including fuel)
– During grading operations the motorgrader travels with
average speed of 4 mph (6.5 Km/hr)
– A 12 foot moldboard with carry angle of 60 degrees
– 3 passes of the motorgrader are needed per mile
39

40. Cost Estimation: Gravel Road (Cont’d)
• Assumptions
– Operator cost was assumed to be 40 USD/hr
– Trucks (with twelve yard capacity) at 50 USD/hr (includes
fuel)
– Operator cost was assumed to be 30 USD/hr (round trip for
each time loading of aggregate would take 75 minutes)
– Based on discussions with county engineers we found that
number of grading operation would vary from three times
per month to three times per week, depending on the
daily traffic
– Therefore this parameter was considered as one of the
uncertain input variables stochastic analysis
40

41. Cost Estimation: Gravel Road (Cont’d)
• Calculation of motorgrader work hours
– 𝐴 = 𝑆 × 𝑙 𝑒 − 𝑙 𝑜 × 5280 × 𝐸 (Caterpillar performance handbook,
2015)
– Where:
– A: Hourly operating area (ft2/hr)
– S: Operating speed (mph) = 4 mph
– Le: Effective blade length (ft) = 10.4 ft (from
– Caterpillar Performance Handbook)
– Lo: Width of overlap (ft) = 2.4 ft for 3 passes
– E: Job efficiency = 0.75
41

42. Cost Estimation: Gravel Road (Cont’d)
• Calculation of motorgrader work hours (Cont’d)
– 𝐴 = 4 × 10.4 − 2.4 × 5280 × 0.75
– 𝐴 = 126.720 𝑓𝑡2/ℎ𝑟
– Time (t) to blade 1- mile road with 24 foot wide top:
• 𝑡 =
Surfacing Area
Motorgrader rate
=
126,720 𝑓𝑡2
126,720 𝑓𝑡2
/ℎ𝑟
= 1.00 ℎ𝑟𝑠
– Since the number of grading operations in each year is
associated with too much uncertainty, a deterministic
value was not assigned to this variable
• 𝑇 = 1.00
ℎ𝑟
𝑚𝑖𝑙𝑒
× 𝑁 𝑚𝑖𝑙𝑒𝑠
42

43. Cost Estimation: Gravel Road (Cont’d)
• Calculation of maintaining/grading costs
– 𝐸𝑞𝑢𝑖𝑝𝑚𝑒𝑛𝑡 = 50 (
𝑈𝑆𝐷
ℎ𝑟
) × 𝑇
– 𝐿𝑎𝑏𝑜𝑟 = 40 (
𝑈𝑆𝐷
ℎ𝑟
) × 𝑇
43

44. Cost Estimation: Gravel Road (Cont’d)
• Calculation of surfacing costs
– 𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑔𝑟𝑎𝑣𝑒𝑙 𝑙𝑜𝑎𝑑𝑠 𝑛𝑒𝑒𝑑𝑒𝑑 𝑓𝑜𝑟 𝑜𝑛𝑒 𝑚𝑖𝑙𝑒 𝑟𝑜𝑎𝑑 =
1 𝑙𝑜𝑎𝑑
12 𝑦𝑑3 × 1000 𝑦𝑑3
𝑚𝑖𝑙𝑒 ≈ 84
– 𝐸𝑞𝑢𝑖𝑝𝑚𝑒𝑛𝑡 𝑐𝑜𝑠𝑡 = 84 × 1.25 ℎ𝑟𝑠 𝑡𝑖𝑚𝑒 𝑡𝑜 𝑙𝑜𝑎𝑑 𝑚𝑎𝑡𝑒𝑟𝑖𝑎𝑙 ×
50
𝑈𝑆𝐷
ℎ𝑟
= 5,250 𝑈𝑆𝐷
– 𝐿𝑎𝑏𝑜𝑟 𝑐𝑜𝑠𝑡 = 84 × 1.25 ℎ𝑟𝑠 𝑡𝑖𝑚𝑒 𝑡𝑜 𝑙𝑜𝑎𝑑 𝑚𝑎𝑡𝑒𝑟𝑖𝑎𝑙 ×
30
𝑈𝑆𝐷
ℎ𝑟
= 3,150 𝑈𝑆𝐷
– 𝑀𝑎𝑡𝑒𝑟𝑖𝑎𝑙 = 𝐺𝑟𝑎𝑣𝑒𝑙 𝑢𝑛𝑖𝑡 𝑐𝑜𝑠𝑡
7 𝑈𝑆𝐷
𝑦𝑑3 ×
1000 𝑦𝑑3
𝑚𝑖𝑙𝑒
=
7,000 (
𝑈𝑆𝐷
𝑀𝑖𝑙𝑒
)
44

45. Cost Estimation: Otta Seal
• The initial construction cost of one-mile double Otta seal was obtained
from Minnesota bid tabs that are publicly available
• By reviewing county cost data analysis (Jahren et al. 2005), the annual
average maintenance expenditure for bituminous roads was assumed to
be 2,400 USD/mile
• When upgrading a gravel road to a BST road, the cost of some
maintenance activities would change
• Activities like grading, graveling, and also cost of dust suppressants will be
ceased
• On the other hand the cost of snow removal operations activities occur on
a paved road would be higher because more time is spent plowing them
45

46. Cost Estimation: Snow and Ice Removal
• Snow removal mile driven cost (MNDOT major
highway projects, trunk highway fund expenditures,
and efficiencies,2016)
46
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Snow removal mile driven 20 19 18 13 20 21 19 20 19 16
0
5
10
15
20
25
USD/Mile
Snow removal mile driven
Costs were adjusted to 2016 dollars using a 3 percent annual inflation factor based on historic MnDOT maintenance and
operations commodity and labor inflation

47. Cost Estimation: Snow and Ice Removal
(Cont’d)
• Historical records on average number of snow events
in Minnesota (ASOA data base)
47
0
5
10
15
20
25
30
35
40
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Snowevent

48. Cost Estimation: Snow and Ice Removal
(Cont’d)
• 𝑆𝑛𝑜𝑤 𝑟𝑒𝑚𝑜𝑣𝑎𝑙 𝑎𝑣𝑒𝑟𝑎𝑔𝑒 𝑎𝑛𝑛𝑢𝑙𝑎 𝑐𝑜𝑠𝑡 =
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑠𝑛𝑜𝑤 𝑒𝑣𝑒𝑛𝑡𝑠 ×
𝐴𝑣𝑒𝑟𝑔𝑎𝑒 𝑠𝑛𝑜𝑤 𝑟𝑒𝑚𝑜𝑣𝑎𝑙 𝑑𝑟𝑖𝑣𝑒𝑛 𝑐𝑜𝑠𝑡
𝑈𝑆𝐷
𝑚𝑖𝑙𝑒
×
2 two passes of snowplow = 17 × 19
𝑈𝑆𝐷
𝑚𝑖𝑙𝑒
× 2 ≈
650 𝑈𝑆𝐷
48

49. LCCA Methodology
• The specific approach for this study utilizes equivalent
uniform annual cost (EUAC) analysis, permitting
elimination of many assumptions required when using
the more common, and more problematic, net present
worth LCCA
• Similar to the previous section, the issues associated with
a deterministic EUAC model, like sensitivity to discount
rate or volatility of underlying commodity prices was
addressed by developing MCS based economic analysis
• Twenty-year discount rate data from the Federal Reserve
was obtained and implemented into the model
49

50. LCCA Methodology: Gravel Roads
• Due to fluctuated number of grading operations, this variable
treated probabilistically in stochastic EUAC calculations
• Triangular distribution was used, using the following scenarios
developed to describe uncertain nature of this variable:
– Low value : The road is graded 3 times per month from April to
October, for a total of 21 times
– Most likely value: The road is graded 5 times per month from March to
November, for a total of 50 times
– High value: The road is graded 7 times per month from March to
November, for a total of 70 times
50
$15.5k
$15.5k

51. LCCA Methodology: Otta Seal
• Similar to gravel roads EUAC calculations, maintenance was
treated deterministically for Otta seal LCCA analysis
• Based on the bid records from Winona county in Minnesota,
triangular distribution was used to describe construction cost
of double Otta seal
• Service life uncertainty creates sensitivity in EUAC results,
making it a good candidate for stochastic treatment and
deterministic sensitivity analysis
51
0 5 10 15 20
Single chip seal
Double chip seal
Single Otta seal
Double Otta seal
Max
Min
Project location Year Double Otta seal
cots (USD/mile)
CSAH 2, Winona county, MN 2016 57,000
CSAH 13, Winona county, MN 2016 67,600
CRs 31, 37 and 116, Winona county,
MN
2017 59,800

52. LCCA Results
• Stochastic economic analysis results
52

53. Indirect Benefits of Otta Seal over Gravel Road
• It may not be possible to justify road way surface
decision making based solely on economic analysis
• There are many benefits associated with bituminous
surface treatments on an aggregate road that do not
have monetary value
• Those benefits cannot be quantified and included in an
economic analysis
• Some of the benefits that need be considered in decision
making for road way surfacing are safer surface,
improving driving efficiency, and dust control
53

54. Indirect Benefits of Otta Seal over Gravel Road
(Cont’d)
• BST implementation on top of gravel roads would
create a surface with higher skid resistance
• Driving efficiency would also increase when a vehicle
moves on a smooth hard surface, unlike a loose
gravel road
• Driving on a gravel road would create a rougher ride
and increase the amount of wear and tear on a
vehicle’s tires
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55. Indirect Benefits of Otta Seal over Gravel Road
(Cont’d)
• Less dust in the car filters would result in more fuel
efficiency and reduced maintenance cost
• BSTs, especially Otta seal, provide dust free surcease
for the public
• With no dust coming from roadways, living condition
would improve and may result in reduction in
breathing health-related issues, less water and
environmental pollutants, and less time cleaning for
adjacent homeowners
55

56. Deterministic EUAC Analysis Tool
for County Engineers
• ISU research team also developed a deterministic EUAC
tools for county engineers
• This tool compares the life cycle cost of surfacing and
maintaining a gravel road with an upgraded gravel road
to Otta seal coated surface
• This tool can be modified and used to address local
conditions
• This tool can be used for to compare annual cost of
gravel roads with other BSTs types as well
56

57. Deterministic EUAC Analysis Tool
for County Engineers (Cont’d)
57
Gravel road inputs
Otta seal inputs
Results

58. Deterministic EUAC Analysis Tool
for County Engineers (Cont’d)
• This tool also shows detail of cash flow analysis
58
Cash flow analysis for
a one-mile Otta seal
showing detailed
costs for 12 years life
cycle
Cash flow analysis for
a one-mile gravel
road showing
detailed costs for 5
years life cycle

59. Summary of Key Findings
• Stochastic and deterministic economic analyses were
conducted to determine needed investment to upgrade a
gravel road to an Otta seal road
• Historical bid and performance records of Otta seal in
Iowa were not available; therefore Minnesota was
considered as a case study to conduct the analysis
• Although the result of economic analysis reveals that in
some cases an upgrade to Otta seal investment might be
justified by maintenance savings alone, the analysis
showed that the maintenance savings alone cannot be a
good justification for the investment for most cases
59

60. Summary of Key Findings (Cont’d)
• However, the upgrade from gravel road to Otta seal,
or any other BST, could be justified to improve the
quality of life for neighbors and the safety of road
users and to encourage economic development for
the local area benefit
• Local officials may use the cost estimating and the
economic analysis techniques described in this
report to help them target investments toward roads
that will provide the best result
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61. Summary of Key Findings (Cont’d)
• Previous studies showed that the annual maintenance costs
for a gravel road increases as the annual average annual daily
traffic increases
• Since there is a general trend of increasing traffic volume,
especially in urban areas, it is recommended to conduct
further studies on the best time for upgrading roads to BST
with traffic volume considerations
61

62. Outline
• TR-674 Objectives and Research Plan
• Economic Analysis of Case Study I: Otta Seal Vs. Chip
Seal
• Economic Analysis of Case Study II: Otta Seal Vs.
Gravel Road
• Summary
62

63. 63
Thank You!
Questions & Comments?

64. EXTRA SLIDES
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65. Approach/Methods (Cont’d)
• In the study conducted by ISU in year 2005, the
method presented to develop cost estimates using
local data sources
• For purposes of economic evaluations, cost
estimation approach was developed in another study
by ISU research team for estimating gravel
maintenance costs
65