The Assessment Of Forest Fees (O.D.C. 6)

Summary

Various principles which might serve as a basis on which to assess the fees to be charged for standing timber are examined. It is concluded that the forest fee should as nearly as possible equal the market value of standing timber; possible methods of arriving at this value are considered, and it is concluded that whenever possible standing timber should be sold by competitive tender. It is recognized that this is seldom practical and that some indirect method of arriving at a market value is needed. The “residual value”—i.e. sale price of sawn timber at the first competitive market less all costs and conversion losses between stump and market—is considered the fairest basis for forest fees. A brief account of the simple methods which can be used to obtain the data needed to operate a residual value system is given.