METHODS OF FOREST POLICY. 251 



capacity for producing the lowest value of market- 

 able wood. 



But since the harvest cannot be secured annually, 

 since it must accumulate for the length of a rota- 

 tion before a return for the expenditure of tax and 

 otherwise comes to the owner, a compound interest 

 calculation on returns as well as on the annual tax 

 must be made to come to a rational assessment 

 rate. 



An example may make it clear how an equitable 

 valuation of a growing forest crop could be made 

 without going into much finesse. 



If an acre produce annually at the average rate 

 of one-half a cord of salable wood, and it takes 30 

 years before the crop is ripe for harvest, and the 

 15 cords then harvested brought a stumpage value 

 or wood leave of 20 cents per cord or $3.00 per acre, 

 the soil rent upon which the assessment should be 

 established would figure, according to well-known 

 interest calculation (if a 5 per cent interest rate 

 be acceptable for such investment, which would 

 be fair for the present time in many places), as 



3 x o 1 ? 



r 1 = 4A cents, and the value of the soil as 

 I.O5 30 i 



wood producer under the conditions named would 



4-5 

 be -^ = 90 cents per acre. 



And if, as is usual with real property, only 60 

 per cent of the value is taxed, the taxable value of 

 such an acre would be 54 cents. This would be 



