Forest Valuation in Conservation Easements
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The “Before” CE Scenario

(or Non‐Project or Normal or Baseline (take your pick))

  1. The forest value is appraised just as a normal present value capitalized income management appraisal.
  2. All current agreements are off; i.e. the appraisal assumption is that a speculator will acquire the property and do whatever they can under the law to liquidate the stand (1not as for in estate valuation porpoises)
  3. All rules and restrictions limiting harvest must be accounted for in the harvest projection procedure.
  4. The capitalized harvest schedule can be taken out to the second decade If the stand is too young to clearcut now, or if there are other rules or silviculture advantages that would create more PV.

The “After” CE Scenario

(or Project scenario)

  1. The forest value is also appraised as present value capitalized income, but the CE restrictions must be applied as limitations to harvest, including:
    1. A percentage of standing inventory retention (POI) per decade (see details in the FMP)
    2. The No‐Harvest area will be removed from harvest. (see the NHA details in the FMC).
      • The stumpage value of the NHA stands do not provide appraisal value if their volume is included in the POI
      • If the NHA is not included in the POI, the stumpage appraisal value the NHA contributes will be include in the appraisal.
  2. All rules and restrictions limiting harvest must be accounted for in the projection procedure.
  3. The capitalized harvest schedule should be taken out to the second decade (two cycles) to capture all potential significant present value $.

General Details

The Appraiser will take the two scenario’s capitalized PV stumpage values provided by the RPF, and subtract the After from the Before to arrive at the appraised CE forest monetary value.

The RPF must describe specific forestry capital projection procedures: or summarize and be prepared to provide detail.

The appraisal will be reviewed by both CA GSA and the Forest Service. the RPF can use any reasonable method so long as the method has integrity to the RPF, and as such the RPF is willing to argue any procedural challenges with passion if necessary.