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A cost-benefit analysis of The National Map

January 1, 2003

The Geography Discipline of the U.S. Geological Survey (USGS) has conducted this cost-benefit analysis (CBA) of The National Map. This analysis is an evaluation of the proposed Geography Discipline initiative to provide the Nation with a mechanism to access current and consistent digital geospatial data. This CBA is a supporting document to accompany the Exhibit 300 Capital Asset Plan and Business Case of The National Map Reengineering Program.

The framework for estimating the benefits is based on expected improvements in processing information to perform any of the possible applications of spatial data. This analysis does not attempt to determine the benefits and costs of performing geospatial-data applications. Rather, it estimates the change in the differences between those benefits and costs with The National Map and the current situation without it. The estimates of total costs and benefits of The National Map were based on the projected implementation time, development and maintenance costs, rates of data inclusion and integration, expected usage levels over time, and a benefits estimation model.

The National Map provides data that are current, integrated, consistent, complete, and more accessible in order to decrease the cost of implementing spatial-data applications and (or) improve the outcome of those applications. The efficiency gains in per-application improvements are greater than the cost to develop and maintain The National Map, meaning that the program would bring a positive net benefit to the Nation. The average improvement in the net benefit of performing a spatial data application was multiplied by a simulated number of application implementations across the country. The numbers of users, existing applications, and rates of application implementation increase over time as The National Map is developed and accessed by spatial data users around the country.

Results from the 'most likely' estimates of model parameters and data inputs indicate that, over its 30-year projected lifespan, The National Map will bring a net present value (NPV) of benefits of $2.05 billion in 2001 dollars. The average time until the initial investments (the break-even period) are recovered is 14 years. Table ES-1 shows a running total of NPV in each year of the simulation model. In year 14, The National Map first shows a positive NPV, and so the table is highlighted in gray after that point. Figure ES-1 is a graph of the total benefit and total cost curves of a single model run over time. The curves cross in year 14, when the project breaks even. A sensitivity analysis of the input variables illustrated that these results of the NPV of The National Map are quite robust. Figure ES-2 plots the mean NPV results from 60 different scenarios, each consisting of fifty 30-year runs. The error bars represent a two-standard-deviation range around each mean.

The analysis that follows contains the details of the cost-benefit analysis, the framework for evaluating economic benefits, a computational simulation tool, and a sensitivity analysis of model variables and values.

Publication Year 2003
Title A cost-benefit analysis of The National Map
DOI 10.3133/cir1271
Authors David L. Halsing, Kevin Theissen, Richard Bernknopf
Publication Type Report
Publication Subtype USGS Numbered Series
Series Title Circular
Series Number 1271
Index ID cir1271
Record Source USGS Publications Warehouse