This report describes a methodology developed at the Transportation Systems Center for the Federal Railroad Administration and the Federal Highway Administration to aid in determining the most effective allocation of funds to improve safety at rail-highway crossings. One way to improve safety is to install active motorist warning devices at the crossings. However, since available funds are insufficient to provide an active warning device at all of the 216,000 public rail-highway crossings in the United States, a method has been developed for selectively allocating these funds in a optimal way. The resource allocation model employs an accident prediction formula which was determined statistically from the extensive data base of the DOT-AAR National Rail-Highway Crossing Inventory and the FRA accident files. The predicted accident rates from this formula, combined with the warning system effectiveness and cost parameters, provide a funding priority ranking of crossing/warning device combination options which are based upon benefit/cost ratios. By selecting from this list, decisions can be made which should increase the accident reduction benefits for any given funding level.