Establishing the Value of Street Trees

Volume 1, Number 2

November 1997

Brattleboro, VT -- The Northeast Center for urban & Community Forestry, working in cooperation with the Vermont Urban & Community Forestry Program and Brattleboro's Trees Please, a community based advocacy group, provided an analysis of tree inventory data for the Town of Brattleboro, Vermont in an effort to establish a composite methodology for assessing the value of trees found growing along the roadways in a community. Included here is a summary of the study, and an outline of the composite methodology developed.

Street trees have many forms of value, both economic and non-economic. Trees have personal and social values, which include; recreational, aesthetics and a human relationship with nature. For this reason city parks with trees are often the oasis sought by urban dwellers on hot summer days. Environmental values of trees include engineering uses such as erosion control, pollution reduction and sound control. City street trees reduce noise and air pollution from city automobiles and buses. As well city trees reduce wind and water soil erosion by stabilizing soil particles. Climatological values affect our heating and cooling by blocking winter winds and intercepting up to 90% of summer solar energy. These values producing a more comfortable living environment and reduce utility costs.

Economic values of urban woodlands include pulpwood, firewood, chip mulch and lumber. These values are more often found in small urban woodlots rather than in an individual street tree planting. However, colder climates certainly benefit from firewood for the winter months. Chip mulch is often used in landscape settings for both aesthetic purposes as well as plant health purposes. Smaller urban trees have replacement value; the cost of replacing the existing tree with the same or similar nursery stock. If the existing tree is available from the nursery than the value of the existing tree is simply the planted price of the tree from the nursery. Specimen plantings in key locations are often assessed an individual value. The most common method of assessing value to individual trees is using the trunk method formula as written by the Council of Tree and Landscape Appraisers(1). The following example shows how a basic price is established and then adjusted by four key factors: 1. Size 2. Species 3. Condition 4. Location

Example: We want to establish the value of a 15" DBH (or 177.46 square inch) sugar maple in fair condition located on a city street.

First a per square inch "basic price" is determined based on the largest available and transplantable tree.

Example: the largest available sugar maple from a local nursery is a 7-8" caliper (or 44.23 square inch) sugar maple. The nursery cost for this tree is $1,400.00. Using these figures, a basic per sq. in price would be $31.60 ( cost divided by area {$1,400 / 44.23})
 

1) Size

This basic price is then adjusted for DBH (diameter at breast height; measured at 4.5'). When evaluating an individual tree, the larger the DBH, the more valuable the plant. The per square inch basic price is multiplied by the area of the evaluated tree that is not replaceable; the difference in area between the existing tree and the replacement tree (see below).

Figure 1

Area of existing tree

Area of replacement tree

(available from nursery)

*Value is based on gray area only. This is the difference in area between the existing tree and the replacement tree. Area is calculated by multiplying radius squared by . (r 2)

Example: Existing tree area (177.46 sq in) minus replacement tree area (44.23 sq in)

177.46sq in - 44.23sq in = 133.23 square inches.

Basic price($ 31.60) multiplied by difference in area (133.23 sq in).

133.23 sq in X $31.60 = $4210.06.
 

2) Species

Tree species affect value; a weak wooded willow is less valuable in an urban setting than a stronger sugar maple. For this reason, associations such as the International Society of Arboriculture have established a tree species ratings ( For this example the " New England Tree Species Rating and Valuation Guide"(2) as published through the New England Chapter of the International Society of Arboriculture; was used in Brattleboro Vermont). These ratings are based on a trees characteristics; such as strength, growth rate and habit, as well as disease and insect resistance. According to these ratings a sugar maple would have an 80 - 100% (average =90%) species rating. A lesser valued willow would have a 40 - 60% rating.

Example: $4210.06( from above) X .90 (Average sugar maple rating) = $3789.05

The remaining adjustments are based on the species adjusted value (3789.05) plus the planted cost of the replacement tree ( the white area in figure 1). It is common to multiply the nursery cost by 3 to estimate the planted price. Other methods include using the median of three local contractors installed prices.

Example: nursery price $1400.00 X 3 (factor to establish planted price) = $4200.00

Add the above adjusted price $3789.05 + est. planted price $4200.00 = $7989.05
 

3) Condition of the Tree being Evaluated

A condition rating depends on the trees structural integrity and health. This information is often assessed during a tree inventory. As well a percentage is assessed to the basic price. One common method is using good (90%), fair (70%), poor (50%) and dead (0%).

Example: adjusted price from above $ 7989.05 X fair condition value .70 = $5592.33
 

4) Location

The location of a tree, also a percentage, identifies trees planted in a pasture behind a building from one in front of the town hall. The tree in front of the town hall would probably have a greater value and therefore assessed a higher percentage. Location percentages may also be obtained through the Council of Tree and Landscape Appraisers or in Millers Urban Forestry text(3). The Council of Tree and Landscape Appraisers method averages three factors to establish a location value; 1) site 2) contribution 3) placement. The "site" factor considers the trees surrounding conditions including surrounding maintenance, building quality and economic development. "Contribution" is the influence value that a tree has on the surrounding landscape, and "placement" considers the plants function in the landscape. Using an average of 75% for street trees is common.

Example: Adjusted price $5592.33 X street tree location percentage .75 = $4194.25

Final Example tree value rounded to nearest hundred $4200.00

Streetscape scale: establishing the value of more than one tree

The preceding is a common method of assessing the value to an individual tree. Calculating the value of every individual tree in a streetscape may not be a realistic option, due to total number of trees and time and resources. In a field example, the town of Brattleboro Vermont established a green infrastructure value by determining the "average street tree". Rather than establishing the value every individual tree, the value of the "average tree" is calculated. The value of the average tree is then multiplied by the total number of trees inventoried; thus resulting in a "total green infrastructure value". The average tree value is calculated using the Council of Tree and Landscape Appraisers formula.

Field Example: Brattleboro Vermont

As calculated earlier, the basic per sq. in price needs to be calculated using un-planted nursery costs. Because the ecosystem contains more than one species of tree, the per sq. inch price is based on the most prevalent species found in Brattleboro. Table 1 lists the five most prevalent species and their percentages ; for example, of all the inventoried trees in Brattleboro 39% are maples (acer). Nursery values were established from three local nurseries, the price of the largest available transplantable tree was chosen. This is a very important step in assessing accurate values because nursery prices, and installation cost will vary by region.

Table 1

Species % of Inventory DBH Radius Area sq.in Cost (unplanted) Price/sq.in.

Acer 39% 7.5" 3.75" 44.24 $1400 $31.646

Fraxinus 2% 6.5" 3.25" 33.23 $1250 $37.618

Gleditsia 5% 6" 3" 28.31 $600 $21.192

Quercus 2% 6" 3" 28.31 $650 $22.958

Tilia 5% 6" 3" 28.31 $600 $21.192

Total 53%

Average 6.4" 32.5 $900

Table 1 shows that the average size replacement tree was a 6.4" caliper tree costing $900.00 wholesale, not planted. Using this data we calculated a per sq. inch value of $27.69 per sq. In. ($28.00) Calculated by dividing average price ($900) by average square inch (32.5 sq in).

Using a sample of approximately 30% (about 300 trees) of the collected, usable data, an average Brattleboro tree was calculated (see Table 2). These averages from 300 trees will be applied the formula the same way as an individual tree.

Table 2

Factor Average Brattleboro value

Average species rating 76%

Average condition rating 72%

Average Diameter at Breast Height 15 inches (177 sq. in.)

Average tree replacement size 6.4 inches (32 Sq in)

Fixed street tree location value 75%

Methods

Using the formula and the same steps as described above, the value of the average Brattleboro tree was calculated (see table 3). In our example , estimated planted price was established by multiplying the average nursery cost ($900 from table 1) by 3. A factor of three was used to factor variables in planting costs. Our basic per square inch price is $28 (from table 1). Species rating were assessed using the New England Chapter of the International Society of Arboriculture's evaluation committees guide(2). Condition ratings were from data collected by inventory volunteers and a fixed 75% value was assessed for our streetscape locations.

Table 3

Description Value Method Adjusted dollar value

Basic price based on 145 sq. Inches

177 {existing tree} - 32 {replacement tree} = 145) 145 X 28 = $4060.00

Basic price adjusted by species rating 76% 4060.00 X .76 = $3085.60

Adjusted price plus planted cost

($900 (avg. nursery $) X 3 = estimated planted cost) $2700.00 3085.60 + 2700 = $5785.60

Price adjusted by average condition 72% 5785.60 X .72 = $4165.63

Price Adjusted by fixed location 75% 4165.63X .75 = $3124.22

The "average" Brattleboro tree is valued at $3100.00 (rounded to nearest hundred).

Streetscape Value

Using the values from table 3 and those from table 4, we can conclude that the average Brattleboro tree is valued at $3100.00. Brattleboro has inventoried approximately 1,000 trees, at a calculated streetscape value of $3,000,000.00. The 1,000 trees do not represent the entire town of Brattleboro, therefore as more data is collected, total value will increase. Trees, especially urban trees, may have a negative value; the cost of removal may be greater than the value of the tree. Tree removal cost can be calculated by using the median of three contractors prices. This median price could then be multiplied by the number of hazardous trees or trees scheduled for removal. For example; a town may contain 40 trees that are either hazardous or scheduled for removal. The median cost of removal could be estimated at $400.00 per tree (400 X 40 =$1600.00). The $1,600.00 would then be subtracted from the total asset value to yield a more accurate total value. Identifying hazard trees and trees that need to be removed, is critical in the inventory process.
 

CONCLUSION

Cities and towns with or without completed street tree inventories will benefit from assessing dollar values to their streetscape trees. Many communities are aware of what management strategies need to be carried out on their urban trees, however they lack the adequate funding to carry out these duties.

Knowing the total streetscape value may act as a leveraging tool to obtain funding for management. Using the total streetscape dollar value as a percentage of your annual maintenance budget can be used when seeking funding. The total allotted budget for the tree warden of Brattleboro is approximately $3,000.00. That means the annual tree maintenance budget for Brattleboro is only .001% of total streetscape asset value. To lobby for a budget of .005% of total asset value would result in an annual budget of $15,000.00. Using percentages is effective because even a very low percent will result in an increased budget. The percentage can also be compared to budgets of buildings and other community assets. Alternatively, the values of trees increase in value each year, rather than decrease in value, as most other assets.

Total streetscape value may also be used as part of a emergency management response protocol. Cities and towns may need to apply for emergency management funds through government agencies, such as FEMA or a state equivalent. Lost tree value could be incorporated into each catastrophic event. The value could then be used as a leveraging tool similar to the maintenance budget plan described above. Individual trees values are important for insurance and the Internal Revenue Service. When town property is damaged or destroyed maliciously, insurance may be an option for recovering lost capitol. As well The Internal Revenue Service recognizes lost landscape value as a casualty loss that can be deducted from taxable income. These reasons support the assessment of individual trees values, especially specimen trees.

Dollar values are important to a communities overall net worth. The streetscape is an often overlooked asset when determining "value". High streetscape values could attract not only business, but residents and community pride as well. In this example , several advantages have been gained for the community. Inventory volunteers have concrete valuable feedback, city officials notice a serious budget deficiency and valuable data has been calculated and can be used for future projects. As more communities establish streetscape values, a standard budget percentage could be calculated. This standard could then be used for lobbying and leveraging for a "standard" tree maintenance budget. Tree values should be "reasonable". Inaccurate tree values will only degrade the valuation process and distract from a standard budget percentage.
 

Additional Information

1. "Guide for Plant Appraisal." International Society if Arboriculture. Savoy, Illinois (217) 355-9411.

2. "New England Tree Species Rating and Valuation Guide." International Society of Arboriculture New England Chapter. Marlboro Vermont (802) 254 - 9626

3. "Urban Forestry - Planning and Managing Urban Greenspaces." 1996. Robert Miller. Prentice-Hall Englewood Cliffs, New Jersey.

4. "Municipal Tree Management in the United States: A 1994 Report." International Society of Arboriculture, USDA Forest Service, and Davey Tree Expert Company. Kent, Ohio.

5. "Street Tree Factsheets." Edited by Henry Gerhold, Willet Wandell, and Norman Lacasse.1993. Pennsylvania State, College of Agricultural Sciences. State College, PA.

6. "How to Conduct a Street Tree Inventory." 1994. Tree City USA Bulletin No. 23. The National Arbor Day Foundation. Nebraska City, NE.

Most of these reference materials are readily available for purchase from the publisher, or may be found at university or college libraries.

This Project Profile has been authored by Matthew L. Petitjean, H. Dennis P. Ryan, and David V. Bloniarz. The authors wish to thank James Ingram of Bartlett Tree Expert Co. for reviewing this manuscript, and Joan Weir of the Vermont Urban & Community Forestry Program for her assistance in completing the project. All of the data on the street trees of Brattleboro utilized in this Project Profile, was collected by community volunteers under the direction of Brattleboro's Trees Please! For additional information please contact the Northeast Center for Urban & Community Forestry at UMass/Amherst.

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