will be the annual charge (20c) multiplied by the number of years the 

 crop takes to grow. 



Interest on Administration Costs 



Compound interest at the chosen rate on each annual amount from 

 the time it is expended until the timber is cut must be calculated. This 

 may be done by compound interest formulae, or taken from such tables 

 as those in Schenk's "Forest Finance."* The specific amounts under 

 certain conditions will be considered later. 



Annual Taxes 



The annual taxes is a difficult item to foresee. At present taxes in 

 Washington are all considered under the general property tax (a most 

 unscientific system) averaging perhaps 1 per cent to 2 per cent on the 

 actual value of the property. Since, owing to the urgent need of schools, 

 roads, etc., in a pioneer community, and the absence of improved prop- 

 erty, taxes may now be thought to be high. A rate of 1 per cent on the 

 actual value of the property may perhaps be considered a fair figure 

 when the future is to be taken into consideration. 



Even if this figure is conceded fair, our difficulties have really just 

 begun because of the changes in value that will take place with time, due 

 to the growth of the stand and to changing land values and stumpage 

 prices, to say nothing of continual changes in assessment methods. The 

 following figures are, however, intended to represent a fair approximation 

 of the values to be expected on Quality I Forest Soil, which, as already 

 stated, is considered to be worth $10.00 per acre. 



(1) Up to the 20th year of the stand only the soil value of $10.00 

 per acre would generally be considered by assessors. During this period 

 the taxes at 1 per cent would be 10 cents per acre. 



(2) From the 21st to the 30th years of the stand perhaps $10.00 

 per acre might be added to the valuation because of the young stand, 

 making taxes 20 cents per acre per annum. 



(3) From the 31st to the 40th years of the stand, since it is not yet 

 in the saw timber class, it can best be estimated in cubic feet. It will 

 now contain (on Quality I Soil) 4,000 cubic feet per acre, or about 

 40 cords, which as pulpwood would be worth, say 50 cents per cord, 

 bringing the total value of land and timber up to $30.00 per acre and 

 the tax to 30 cents per acre per annum during this period. . 



(4) From the 41st to the 50th years the volume will be about 

 20,000 ft. B. M. per acre, worth on the average (considering increased 

 stumpage prices. in the future) at least $3.00 per M., or $60.00 for the 

 whole stand. Hence soil and timber would be worth $70.00 per acre and 

 the annual tax 70 cents. 



(5) From the 51st to the 60th years the stand would contain an 

 average of about 35,000 ft. B. M., with a stumpage value of say $8.00 

 per M., hence the total value of stand and soil, $290.00, and the annual 

 tax $2.90 per acre. 



To recapitulate, the taxes on Quality I Forest Soil by the general 

 property tax are estimated somewhat as follows: 



1st to 20th years, 10 cents per acre per annum. 



21st to 30th years, 20 cents per acre per annum. 



31st to 40th years, 30 cents per acre per annum. 



41st to 50th years, 70 cents per acre per annum. 



51st to 60th years, 2.90 cents per acre per annum. 



*"Forest Finance," by C. A. Schenk. 



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