The ASCA update article in the Nov. 1998 ArborAge magazine stopped me in my tracks. The author's opinion basically says that street tree's value peaks at about 18" dia. He separates street trees from ornamentals in this regard, and alleges that maintenance costs begin to outweigh benefits at that stage of growth.

I guess I would query the field here, and ask the group for more perspective on this opinion. I for one am having trouble validating that whole train of thought in my own mind. I can concede that thresholds for benefits vs liabilities exist, but question the assignment of a certain size without consideration of species, environment, individual inspection, etc.

Am I alone?

Best regards,
KWK

Reply to post by Kerry, on November 15, 1998 at 00:38:38:

I just logged on to write about the same article as Kerry. Exactly what is the ASCA update? Maybe someone needs to give "Arbor Age"
magazine an "Update" as well as the Author. I feel this is actually a good representation of the way arboriculture still is around the world.
There are still a lot of "Old School Authorities"
giving out information and a lot of them are very good people they just stopped learning at some point. As Dr. Shigo pointed out at a 1998 conference in Waco Texas, when someone said that they liked doing things the "old fasioned way" he responded "Why don't you go try out and "old Fasioned dentist!"
Ken Six

Reply to post by Kerry, on November 15, 1998 at 00:38:38:

Kerry asked 11/15 about the limitation of tree value at a size threshold as suggested in a recent Arbor Age column (Buckley, Pat 1998. ASCA Update, Arbor Age, November 18(11), pp. 48-49). The broad issue of when in the life of an asset its value peaks and when the asset becomes a liability (value 18” (or whatever) are deductions from value or are simply exchanged for value? Maybe exchanged for a ‘profit,’ each unit of expenditure returns > 1 unit of value. One way is to consider the typical lifespan and performance profile of a particular tree type in a particular setting, consider the current age or performance of the appraised tree and reduce or depreciate costs accordingly.

Another way is to employ INCOME approaches to value which focus on the receipts rather than the expenditures.

An appraiser might set arbitrary thresholds, but the reliability of the result will depend on the extent and timeliness of the data behind the threshold selected.

We can also note Cost / Benefit models which consider both expenditures and receipts. These include:

the USDA Forest Service models (McPherson, E.G., et al 1994. Chicago’s Urban Forest Ecosystem: Results of the Chicago Urban Forest Climate Project. Northeastern Forest Experiment Station, General Technical Report NE-186; Miller, Robert W. (ed.) 1998. Development, Structure, and Sustainability of Scaramento’s Urban Forest, Parts I and II. Journal of Arboriculture, March 24(2) and July 24(4) );

the ISA/Davey Quantitree ™ model (Davey 1993. Consolidating and Communicating Urban Forest Benefits; Davey 1998. www.davey.com; www.quantitree.com);

the National Arborist Foundation large tree model (NAF and ACRT 1997. Large Tree Model); released in a beta test version by NAA, but may not be available); and

the American Forests model, CityGreen ™.

Basically, these models all compare the total of lifetime expenditures to the total of lifetime receipts (in the form of aesthetics, shade, climate control, air and water quality, etc.) to calculate optimum management strategies, i.e. how much to spend and when. In essence, when total expenditures exceed total receipts there is no net value. NOTE! If net present value NPV (Receipts minus Expenditures) = 0 it does not mean that value = 0. It simply means that the units of expenditure exactly equal the units of receipt, you got what you paid for. If NPV0 you’re getting a lot for what you spend (a ‘profit’). Think of NPV, the result of these models as a performance measure, a guide to decision making, rather than an absolute measure of value.

In any case, there is another basic issue. What is the definition of value specifically applied in the model? Is there a property value limitation? Is replacement cost specifically what you’re looking for?

Without all the facts it is difficult to say clearly whether 18” DBH is a meaningful point to cap value in Pat’s model. In a specific case there are also underlying issues:

What is the purpose and what is the use of the appraisal? Why is the exercise undertaken? What questions is it answering? If it is for a litigation or tax loss or insurance claim there may be specific guidelines that guide the inquiry. If it is for a city to determine the impact on the property tax base then contribution to property value is an issue and it may be beyond the competence of the tree appraiser. If it is for a city to actually project the replacement cost of existing canopy (an example of purpose) then property value doesn’t matter. If the actual replacement cost is for management and budgeting, replacement classes and average needs can be calculated while if it is for influencing policy or public awareness total, hypothetical costs can be projected (examples of use).

What are the levels of accuracy and reliability required? What is an appropriate cost to develop the opinions given the purpose and use? Arbitrary cut offs (such as 18” DBH) may streamline the appraisal process and offer useful guidelines. Graphic modeling software like CityGreen ™ might be used to show the effect on costs and canopy of maintaining certain size thresholds. This might be used to help a community determine just what it does consider valuable.

SUMMARY. Appraisal, and our review of individual appraisal exercises, must rest on a clear understanding of 1) what value is and of the approaches to value, and 2) the definition of the appraisal problem which includes: purpose and use of the appraisal, specific definition of value, date of value estimate, value to whom and limiting conditions.

Reply to post by Kerry, on November 15, 1998 at 00:38:38:

Kerry asked 11/15 about the limitation of tree value at a size threshold as suggested in a recent Arbor Age column (Buckley, Pat 1998. ASCA Update, Arbor Age, November 18(11), pp. 48-49). The broad issue of when in the life of an asset its value peaks and when the asset becomes a liability (value 18” (or whatever) are deductions from value or are simply exchanged for value? Maybe exchanged for a ‘profit,’ each unit of expenditure returns > 1 unit of value. One way is to consider the typical lifespan and performance profile of a particular tree type in a particular setting, consider the current age or performance of the appraised tree and reduce or depreciate costs accordingly.

Another way is to employ INCOME approaches to value which focus on the receipts rather than the expenditures.

We can also note Cost / Benefit models which consider both expenditures and receipts. These include:

the USDA Forest Service models (McPherson, E.G., et al 1994. Chicago’s Urban Forest Ecosystem: Results of the Chicago Urban Forest Climate Project. Northeastern Forest Experiment Station, General Technical Report NE-186; Miller, Robert W. (ed.) 1998. Development, Structure, and Sustainability of Scaramento’s Urban Forest, Parts I and II. Journal of Arboriculture, March 24(2) and July 24(4) );

the ISA/Davey Quantitree ™ model (Davey 1993. Consolidating and Communicating Urban Forest Benefits; Davey 1998. www.davey.com; www.quantitree.com);

the National Arborist Foundation large tree model (NAF and ACRT 1997. Large Tree Model); released in a beta test version by NAA, but may not be available); and

the American Forests model, CityGreen ™.

Basically, these models all compare the total of lifetime expenditures to the total of lifetime receipts (in the form of aesthetics, shade, climate control, air and water quality, etc.) to calculate optimum management strategies, i.e. how much to spend and when. In essence, when total expenditures exceed total receipts there is no net value. NOTE! If net present value NPV (Receipts minus Expenditures) = 0 it does not mean that value = 0. It simply means that the units of expenditure exactly equal the units of receipt, you got what you paid for. If NPV0 you’re getting a lot for what you spend (a ‘profit’). Think of NPV, the result of these models as a performance measure, a guide to decision making, rather than an absolute measure of value.

In any case, there is another basic issue. What is the definition of value specifically applied in the model? Is there a property value limitation? Is replacement cost specifically what you’re looking for?

Without all the facts it is difficult to say clearly whether 18” DBH is a meaningful point to cap value in Pat’s model. In a specific case there are also underlying issues:

What is the purpose and what is the use of the appraisal? Why is the exercise undertaken? What questions is it answering? If it is for a litigation or tax loss or insurance claim there may be specific guidelines that guide the inquiry. If it is for a city to determine the impact on the property tax base then contribution to property value is an issue and it may be beyond the competence of the tree appraiser. If it is for a city to actually project the replacement cost of existing canopy (an example of purpose) then property value doesn’t matter. If the actual replacement cost is for management and budgeting, replacement classes and average needs can be calculated while if it is for influencing policy or public awareness total, hypothetical costs can be projected (examples of use).

What are the levels of accuracy and reliability required? What is an appropriate cost to develop the opinions given the purpose and use? Arbitrary cut offs (such as 18” DBH) may streamline the appraisal process and offer useful guidelines. Graphic modeling software like CityGreen ™ might be used to show the effect on costs and canopy of maintaining certain size thresholds. This might be used to help a community determine just what it does consider valuable.

SUMMARY. Appraisal, and our review of individual appraisal exercises, must rest on a clear understanding of 1) what value is and of the approaches to value, and 2) the definition of the appraisal problem which includes: purpose and use of the appraisal, specific definition of value, date of value estimate, value to whom and limiting conditions.

Reply to post by Scott Cullen, on November 15, 1998 at 00:38:38:

Sorry guys. The file pastes over to the messgae reply window just fine bt quite a bit gets lost from the final post. I'll e-mail to the webmaster and see if it can be fixed.