For nearly 2 months now, we have gone back and forth on the issue of value, as it pertains to trees and appraisal. We have learned the texbook definition (current worth of a future benefit), we have argued the case for including or excluding various aspects, features and benefits, and we have discoursed at great length on the philosophical and ethical.

Now, what have we really said in all this? Without revisiting all the arguements (they are still here on the board to be read), can we summarize where we have been on the issue, and bring it back to earth in encapsulated form?

Whenever you go to a lecture by a researcher, you always hear at the end of the talk, "..that's great, but how do I use it in everyday practice?" This discussion has been, at times, somewhat intimidating to those less schooled in economics, and even in valuation theory and practice. Let's sum it upu in words we can all understand (again, without revisiting or defending all the previous arguments).

Reply to post by Russ Carlson, on November 21, 1998 at 10:25:14:

Texbook definition:
(current worth of a future benefit)

Russ, Kerry, and others is it not apparent; that the point of discussion to define 'Value'is clearly to support, the technical scientific findings (arboriculture) and to provide a verbal mechanism that cannot be ignored by the judicial system, which will acknowledge "arboricultural appraisal values".

80 years, or 800 years of technical scientific study, philisophical debates, ecological study's, will have no effect if we cannot get the courts to recognize the single common agreement of the term 'value' when used in appraising trees.

So, the question we need to answer is: is the textbook definition adequate, yes or no? If not than what is? (Keep in mind, that any definition must be applied universally to all disciplines).

Steve

Reply to post by Stephen Wiley, on November 21, 1998 at 10:25:14:

I think where the thread begins to lose credibility with me is the "future" in the "textbook definition". I'm much more prone to buy into the definition of value being 'current worth of a benefit'.

I think it is clear that the CTLA method of plant appraisal uses "replacement" costs as a foundation, and draws that foundation from the real time values of ornamental nursery stock.

The appraisal process must compare an individual tree's value with a commonly accepted commodity, in this case, nursery stock. Earlier methods of tree appraisal looked at comparing the cost of building a structure to replace the lost shade capacity of the plant. A forested area might want to look at the potential value based on an admission charge to visit the forest. There are certainly options available for exploring HBU issues.

I think where this thread has lead down a blind man's road is where we have departed from comparing real plants with real commoditites that have monetary value to people. Paper and theory doesn't have much of a foundation, and struggles with credibility.

In response to "if we cannot get the courts to recognize the single common agreement of the term 'value' when used in appraising trees"; I would say that it appears that the courts have already accepted a common agreement, particularly in states where the tree value is limited to cord wood value. If there is objection to that limited value, the industry needs to consistently continue to produce appraisals based on higher valued commodities, the courts will catch on in time.

I am prepared to suggest that the CTLA method of plant appraisal presents a very good series of arguements that support values based on nursery stock values for amenity trees.

In the interim, appraisers in those states need to be persistent, and figure out a way to expand the consulting practice enough to pay the bills. Of course the person who gets on board with the test case that sets the new precident should be able to make a buck or two.

I am reading a lot of confusion out there about just how good the CTLA method is. In my mind, there is no confusion. It offers a very solid foundation for quantifying tree losses in amenity situations. On the other hand, I think it is limited to amenity situations, and doesn't apply real well to wild or undeveloped conditions. If you can plug in nursery values for native plants, maybe; but if the place is more fit to be logged than lived in, maybe board foot values are more appropriate for appraisal purposes.

Best regards,
KWK

Reply to post by Stephen Wiley, on November 21, 1998 at 10:25:14:

Steve to the rescue again. I must agree. We've gone off on tangents exploring the ethical basis of society and defending or attacking particular methods. All of it comes back to the same basic question. What is value? I've suggested that the textbook definition 'the current worth of future benefits' applies. Steve asks 'is that an adequate definition, yes or no? If not then what is?'

I'm not sure appraisers will or even should convince society, or individuals or the courts of any particular, universal definition. But appraisers must have a universally applicable understanding of value at its most basic, most essential, most elemental level if they are to perform ethically and effectively in answering the various questions that society, or individuals or courts ask about value.

Reply to post by Kerry, on November 21, 1998 at 20:11:11:

RE: The future. I've posted this reponse at the 'future' thread so when the webmaster archives the discussions it will flow.

RE: The appraisal process. I agree that the CTLA methods are Replacement Cost approaches to value. I also agree that they provide useful, replacement cost indications of value. I'm a little confused by your use of the term 'commodity.' It almost sounds as if you mean it to be a medium of exchange. If you mean that as a traded commodity, nursery stock provides a credible basis for the replacment cost of trees, then I assume you are referring to replacment cost methods. Replacement cost is indeed one way to indicate value. I do not agree that it MUST be the way value is approached and indicated, that it is the only way. The appraisal process is served by a broader and more comprehensive model.

That brings us back to a basic understanding of value. What is it? Once we have that understanding we can consider how we can approach value. Once we understand approaches to value we can develop particular methods and apply those methods through the appraisal process in particular appraisal problems.

The confusion you recognize in these discussions, in my opinion, is because the basic understanding is not there to support (or critique) the methods.

Reply to post by Scott Cullen, on November 21, 1998 at 23:51:47:

Yes, obviously we have trouble with trying to buy and sell enough big trees to have a mechanism for easily defining value of a tree. So, in my opinion, we must compare the subject tree to a commodity (my term) [medium of exchange] (Scott's term). While replacement with nursery stock is a natural, and certainly makes a good commodity to compare, I most heartily agree that it's NOT the only viable comparison. I think we have to look at every aspect of the tree that can be converted to cash. That could be cord wood, lumber, air pollution filter, privacy screen, wind, dust, snow screens, moisture regulator........and as I suggested in an earlier post, it could include comparisons to entertainment admissions.

Reply to post by Russ Carlson, on November 21, 1998 at 10:25:14:

Going back through early threads. See Dorothy 1/28/98 (11) and following. Those of you that participated in that exchange:

Do these recent threads with discussions of definitions of value and approaches to value clear things up at all?