Lost Bear Timber Sale EA ~ Attachment E 



Economic Analysis for the Lost Bear Timber Sale 



a) Costs, revenues, and estimates of return are just estimates intended for relative 

 comparison of alternatives. They are not intended to be used as an absolute 

 estimate of return. 



b) The estimated stumpage is based on comparable sales analysis. This method 

 compares recent sales to find a market value for stumpage. These sales have very 

 similar species, quality, average diameter, product mix, terrain, date of sale 

 distance from mills, road building and logging systems, term of the sale or 

 anything that could affect a buyer's willingness to pay for stumpage. The 

 estimated stumpage price ($ / MBF) for the lower end of the range equals 

 approximately $1 15.00 (Clearwater River #3 Timber Sale) and conversely, 

 $249.00 (Cramer Creek Timber Sale) at the upper end of the range. These two 

 comparable timber sales were sold based on tons. Six and one half tons per MBF 

 was used to convert from tons to MBF. 



c) The estimated gross revenue for the trust for an alternative is calculated by 

 multiplying the estimated stumpage price by the total estimated volume. The 

 state also collects money for forest improvement. The estimated total collected FI 

 amount equals the FI rate multiplied by the estimated volume. The following 

 table displays the estimated range of gross revenue to the state by alternative from 

 this proposed sale, estimated range of collected FI fees and the estimated post 

 treatment cost for tree planting, and slash burning (broadcast and piles). 



Table 1 .0 Estimated Total Collected FI Fee, the estimated cost for Planting and Slash 

 Burning, and the estimated Gross Revenue to the Trust by alternative from the proposed 

 timber sale. 



d) The costs related to the administration of the timber sale program are only 



tracked at the Land Office and Statewide level. DNRC does not keep track of 

 project level costs for individual timber sales. The following table displays 

 the revenue-to-cost ratios for the State and Southwestern Land Office. The 

 revenue-to-cost ratios are a measure of economic efficiency. A ratio value 

 less than 1 .0 means that the costs are higher than revenues (losing money). A 



