DNR staff recommend net present value objective and 1.7% default discount rate for East Side harvest model

At a Jan. 20 Board of Natural Resources study session, Department of Natural Resources (DNR) staff recommended that the East Side sustainable-harvest calculation use net present value (NPV) as the base objective, that model prices be set by adjusting appraisal prices to reflect auction results, and that costs be counted as actual management expenses. Staff also proposed setting the base-model discount rate to the East Side forest growth rate—about 1.7%—and running sensitivity analyses at other rates as part of alternatives testing.

Sarah Ogden, assistant division manager for projects and planning, said the sustainable-harvest framework is grounded in statute and board policy and quoted the policy definition of a harvest target: "a sustainable harvest level is a volume of timber scheduled for sale from state-owned lands during a planning decade as calculated by the department and approved by the board." She told the board the no-action (base) alternative will model current conditions and that staff will present recommendations for the board’s Feb. 3 meeting.

Dale Yee, one of DNR’s economists, framed the objective function as the model’s way of ranking feasible management actions. "We're saying we should count the monetary returns from timber sales here in…