Black Hills Resilient Landscapes Project

Ecosystem Services and Economics 2017

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Black Hills Resilient 

Landscapes Project

Black Hills National Forest 

All Units

Benefits to People | Ecosystem Services | Economics

Kawa Ng

Regional Economist, Rocky Mountain Region
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Table of Contents

Executive Summary........................................................................................................................ 4

Overview......................................................................................................................................... 7

Regulatory Framework ................................................................................................................... 7

Analysis Area.................................................................................................................................. 8

Affected Environment..................................................................................................................... 8

Existing Conditions – Economic Environment............................................................................... 8

Existing Conditions – Ecosystem Services................................................................................... 12

Environmental Consequences....................................................................................................... 12

Analysis Framework, Methodology and Assumptions..................................................... 13

Ecosystem Services........................................................................................................... 13

Regional Economic Contribution ..................................................................................... 14

Alternative A – Proposed Action.................................................................................................. 15

Direct, Indirect, and Cumulative Effects – Ecosystem Services ...................................... 15

Indirect, and Cumulative Effects – Economic Contributions........................................... 17

Alternative B – No Action ............................................................................................................ 19

Direct, Indirect, and Cumulative Effects – Ecosystem Services ...................................... 19

Indirect and Cumulative Effects –Economic Contributions............................................. 20

Literature Cited ............................................................................................................................. 21
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Executive Summary

Social and Economic contexts

The State of South Dakota has a higher overall per capita income ($48,503) than any county 

individually within the BHNF area of influence (Lawrence, Pennington, Meade, Custer and 

Fall River Counties in South Dakota and Crook County in Wyoming). Among these 6 counties 

within the BH area of influence:

• Meade County has the lowest per capita income ($39,148)

• Custer County has the lowest average earnings per job ($32,226)

• Pennington County has the highest average earning per job ($47,115)

The unemployment rates for the state of South Dakota and the BHNF study area are at or below 

the natural rate of 4.5% – 5%. Economists generally refer full employment – or the natural rate 

of unemployment – as the level of unemployment that predominantly comprises of voluntarily 

unemployed workers (i.e. transitional unemployment in a healthy economy).

Regional Economic Contribution

An Input-Output model was used to estimate the employment, total income and GDP 

contributions for the local economy based on an estimated harvest volume associated with the 

Proposed Action (678,000 CCF), assuming that volume will be harvested over 4 years 

(approximately 169,100 CCF per year, starting in 2019).

• During the project implementation period the proposed action is estimated to support 

over 1,300 jobs, $55 million in total labor income, and $64 million in GDP 

contribution for the local economy on an annual average basis1. 

 1 It is important to note that these may not be new jobs or income, but rather existing jobs and income in the regional economy 

that are supported or sustained by this harvest volume. This analysis employed a linear Input-Output model, therefore, if the 

actual implementation period is shorter, more jobs would be supported over a shorter period of time. Conversely, if the 

implementation period is expanded, fewer jobs would be supported annually but for a longer period of time.
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Ecosystem Services

What are the Landscape 

Needs and Challenges?

How does the Proposed Action address the 

needs to restore and maintain ecosystem 

resilience (fire and insect regulation, habitat 

and scenery diversity)

What are the ecological outcome or 

intended effects?

Wildfire risks on NFS and 

non-NFS lands caused by 

beetle infestation and past 

fire suppression efforts. The 

need for returning 

landscape to the natural fire 

disturbance that native 

species evolved with.

Mechanical and manual fuel treatments

Reduced the potential of dead trees burning 

intensely, damaging soils and causing 

problems for firefighters

Commercial thin

Thinning out small pine trees (not fire 

resistant) to reduce dense patches, 

preventing potential vertical and horizontal 

fire spread. Provision of timber for 

processing (see Economic Contribution 

section)

Prescribed fire

Reduced fuel buildup; returning landscape 

to the natural fire disturbance process that 

native species evolved with.

Hazard tree treatments

Reduced risk of trees falling on open roads 

or trails, structures, private property, or 

critical infrastructure

Old hardwood stands and 

grasslands losing vigor or 

disappearing caused by pine 

encroachment, declining 

aspen. The need for 

maintaining aspen and oak 

stands for their fire and 

insects resistant properties.

Aspen maintenance and enhancement (cut or 

burn encroaching / declining pine)

Maintaining aspen stands that are fire and 

insects (pine beetle) resistant; providing 

habitat and scenery diversity 

Removal of encroaching pine from oak stands

Maintaining oak stands that are fire and 

insects (pine beetle) resistant; providing 

habitat and scenery diversity 

Removal of encroaching pine from grasslands

Provides habitat diversity and scenery

Mountain pine beetle 

infestation has changed 

forest structure and 

composition; Small pine 

trees must compete for 

limited resources in dense 

young stands, potential 

stagnation is slowing 

growth. Stems remain thin, 

and heavy snow can result 

in widespread damage.

Convert some mature stands (SS4A) to young 

stands by removing some or all of the mature 

trees.

Moving toward Forest Plan objectives for 

SS4A and other structure stages. 

Fuel treatments in existing SS4C stands. Increase dense mature forest stands (SS4C)

Thinning or burning understory vegetation in 

some existing late successional SS5 stands.

Maintain or enhance late succession 

characteristics and increase stand resilience

In areas where grass/forb (SS1) is below Plan 

objective, patch cut to produce more SS1 Moving toward Forest Plan objectives for 

SS1 In areas where grass/forb is above Plan 

objective, plant trees in large burned areas to 

facilitate reforestation
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Precommercial thinning small tress in young 

stands

Increase the vigor of remaining saplings and 

to prevent stagnation
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Overview

This project aims to move landscape-level vegetation conditions in the project area toward Forest 

Plan objectives in order to:

• Increase ecosystem resilience to insect infestation and other natural disturbances

• Contribute to public safety and the local economy, and reduce risk of wildfire to 

landscapes and communities

This analysis focuses on various ecosystem services and economic contribution relevant to the 

Proposed Actions. 

Regulatory Framework

The preparation of National Environmental Policy Act (NEPA) documents is guided by the 

Council on Environmental Quality (CEQ) regulations for implementing NEPA [40 CFR 1500-

1508]. NEPA requires that consequences to the human environment be analyzed and 

disclosed. The extent to which these environmental factors are analyzed and discussed is related 

to the nature of public comments received during scoping. CEQ regulations for implementing 

NEPA [40 CFR 1500-1508] do not require a monetary benefit-cost analysis.

Many of the costs and benefits associated with Forest Service projects are not quantified in 

financial terms. For example, the benefit to wildlife from habitat improvement; existence value 

of open space, etc. These costs and benefits can best be considered and described qualitatively. 

Title 40, CFRs for NEPA (40 CFR 1502.23) indicates: 

For the purposes of complying with the Act, the weighing of the merits and drawbacks of 

the various alternatives need not be displayed in a monetary cost-benefit analysis and 

should not be when there are qualitative considerations.

The Healthy Forests Restoration Act (HFRA) of 2003 (16 U.S.C. 6501-6591) provides processes 

for developing and implementing hazardous fuel reduction projects on certain types of "at-risk" 

lands, and also provides other authorities and direction to help reduce hazardous fuels and 

protect, restore, and enhance healthy forest and rangeland ecosystems. The project area includes 

National Forest System lands that are managed by the Black Hills National Forest within the 

areas designated by the Secretary of Agriculture under the amended Healthy Forests Restoration 

Act (HFRA, 16 U.S.C. 6591), excluding Inventoried Roadless Areas and certain management 

areas. It is Forest Service policy to consider ecological, social, and economic sustainability, 

among other factors, when developing goals or objectives for ecological restoration projects

(FSM 2000, chapter 2020). Further, FSM 2020 provides policy for reestablishing and retaining 

ecological resilience of National Forest System lands and resources to achieve sustainable 

multiple use management and provide a broad range of ecosystem services.

This analysis, therefore, comprises of discussions on ecosystem services as well as factors of 

economic sustainability (including local economic contributions) relevant to the Proposed 

Action. 

 
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Analysis Area

While the discussion on ecosystem services generally applies across the entire project area 

(spanning over 1 million acres among 10 management areas), however, the zone of influence

specific to the regional economic contribution model includes four counties, based on locations 

of processing or harvesting firms receiving Black Hills timber in recent years. They include 

Lawrence, Pennington and Meade Counties in South Dakota and Crook County in Wyoming. 

Custer and Fall River Counties in South Dakota are not in the economic model but they are 

included nonetheless as part of the affected environment (existing condition) description in order 

to provide contexts for the social and economic environments surrounding the Black Hills 

National Forest. While Weston County, WY contains NFS lands, it is not included in the model 

because the county’s primary industries are less related to the output and products associated 

with this project.

Affected Environment

Statistics on existing economic and social conditions of the study area are necessary to provide

context for the consideration of the Proposed Action. Summaries of existing demographic, social 

and economic conditions are examined for all counties that contain BHNF lands. Unless 

otherwise noted, sources consist of 2015 data from the U.S. Department of Commerce, Census 

Bureau, American Community Survey, Department of Labor and other official sources retrieved 

using the EPS-HDT (2017) software system maintained by Headwater Economics®. Only major 

trends and benchmark comparisons (State of South Dakota) are presented below; detail data with 

complete, county-by-county statistics are found in Appendix A of the social and economics 

specialist report (project record).

Existing conditions on landscape needs and challenges are described in the ecosystem services 

framework (benefits people received from nature).

Existing Conditions – Economic Environment 

Per capita income, non-labor income, average earnings per job and unemployment rate are 

described below in order to depict measures of individual prosperity in the BHNF zone of 

influence.

Per Capita Income is total personal income (from labor and non-labor sources) divided by total 

population. South Dakota ($48,503) has a higher overall per capita income than the zone of 

influence and other counties within the study area.
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Figure 2. Per capita income for study area counties and South Dakota, 2015 (BEA, 2016).

Per capita income is considered one of the most important measures of economic well-being. 

However, it can be misleading. Per capita income is total personal income divided by population. 

Because total personal income includes non-labor income sources (dividends, interest, rent, and 

transfer payments), it is possible for per capita income to be relatively high due to the presence 

of retirees and people with investment income. And because per capita income is calculated 

using total population and not the labor force as in average earnings per job, it is possible for per 

capita income to be relatively low when there are a disproportionate number of children and/or 

elderly people in the population. For these reasons, non-labor income as a percentage of total 

personal income are reported below in Figure 3.

Figure 3. Non-labor income as a percent of total personal income for study area counties and 

South Dakota, 2015 (BEA, 2016).

Non-Labor income consists of dividends, interest and rent (money earned from investments), 

and transfer payments (includes government retirement and disability insurance benefits, medical 

payments such as mainly Medicare and Medicaid, income maintenance benefits, unemployment 

insurance benefits, etc.). In many counties non-labor income (e.g., retirement and investment 

income, government transfer payments) can be more than a third of all personal income. As the 

baby boomer generation retires, this source of income will continue to grow. A high dependence 

on non-labor income can be an indication of an aging population and/or the attraction of people 

with investment income. Public lands activities may affect these constituents.

Average Earnings per Job are the total earnings divided by total employment. Full-time and 

part-time jobs are counted at equal weight. Employees, sole proprietors, and active partners are 

included. Average earnings per job is an indicator of the quality of local employment. A higher 

average earning per job indicates that there are relatively more high-wage occupations (Figure 

4).
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Figure 4. Average Earnings for study area counties and South Dakota, 2015 (BEA, 2016).

Unemployment Rate is an important statistics of economic well-being. The annual 

unemployment rate is the number of people actively seeking but not finding work as a percent of 

the labor force. This figure can go up during national recessions and/or when more localized 

economies are affected by area downturns. The unemployment rates for the state of South 

Dakota and the study area are at or below the natural rate of 4.5% – 5% (Figure 5). Economists 

generally refer full employment – or the natural rate of unemployment – the level of

unemployment that predominantly comprises of voluntarily unemployed workers (i.e. 

transitional unemployment in a healthy economy). 

Figure 5. Annual unemployment rates for study area counties and South Dakota, 2015 (BEA, 

2016). U.S. Department of Commerce. 2016. Bureau of Economic Analysis, Regional Economic 

Accounts, Washington, D.C.; U.S. Department of Labor. 2016. Bureau of Labor Statistics, Local Area 

Unemployment Statistics.
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Regional Economic Contribution

Commercial timber harvest, including restoration activities such as thinning on the Black Hills 

National Forest contribute to employment, income, or other economic activities in the local 

economy. In order to gain insight on the contribution timber resources make to the local 

economy, recent harvest volume are used as input in the Input-Output model (IMPLAN®). 

During the previous 5 years, annual harvest ranged from 179,554 CCF in 2014 to 206,530 CCF 

in 2012.

Table 1. Black Hills National Forest Recent Cut Volumes (CCF): 

FY2012 - FY2016

2012 2013 2014 2015 2016 5-Yr Avg

Sawtimber (CCF) 193,848 208,936 171,388 193,427 179,010 189,322

Poles (CCF) 5,258 8,172 1,055 3,362 6,216 4,813

Posts (CCF) 1 1 115 39

Firewood (CCF) 6,650 5,093 6,100 6,168 5,925 5,987

Misc. and non-sawtimber 

products (CCF) 774 1,030 1,011 1,508 1,166 1,098

Total 206,530 223,233 179,554 204,466 192,432 201,243

Annual average employment, labor income and GDP contributions from timber harvest are 

estimated using IMPLAN® data and Forest Service modeling tools (see Analysis Framework, 

Methodology and Assumptions in the Environmental Consequences section), based on the 5-year 

average.

Table 2. Annual average employment, labor income and GDP contributions 

from timber harvest (based on 5-year average cut volume from 2012-2016)

Employment

Direct 629

Indirect and Induced 922

Total 1,551 

Labor Income (2015$)

Direct $27,164,538 

Indirect and Induced $36,044,769 

Total $63,209,307 

Contribution to GDP (2015$)

Direct $27,606,347 

Indirect and Induced $46,082,685 

Total $73,689,032 

* Employment is the total full- and part-time wage, salaried, and self-employed jobs in the region.

**Labor income includes the wages, salaries and benefits of workers who are paid by employers and 

income paid to proprietors.
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This analysis employs a linear Input-Output model, therefore, if recent harvest volumes are 

maintained into the near future, all else equal, then the annual average jobs, income and GDP 

supported directly and indirectly in the local economy would likely be sustained. On the other 

hand, if future harvest levels were to drop, these economic contributions would also decrease 

accordingly, all else equal. Needless to say, future regional, national, and in some respect 

international wood product demand will influence these economic contribution results. But with 

regards to commercial harvest from the Black Hills National Forest, it is unlikely that the level of 

recent cut volume will be sustained in the foreseeable future (see Timber Resources section).

Existing Conditions – Ecosystem Services

Detailed information on the extents and needs to bring the distribution, by pine structural stage 

(SS), closer to desired conditions are described in the Purpose and Needs as well as the project 

scoping document. This section summarizes the existing landscape challenges, and identifies the 

ecosystem services (goods and services that people receive from nature) or ecological processes 

associated with those landscape needs.

Existing Condition (Landscape Needs and Challenges) Relevant Ecosystem Services, Processes, 

Structure and Function

Wildfire risks on NFS and non-NFS lands caused by beetle 

infestation and past fire suppression efforts. The need for 

returning landscape to the natural fire disturbance that 

native species evolved with.

Regulations of insect infestation and other 

natural disturbances

Old hardwood stands and grasslands losing vigor or 

disappearing caused by pine encroachment, declining 

aspen. The need for maintaining aspen and oak stands for 

their fire and insects resistant properties.

Habitat and scenery diversity; ecosystem 

resilience to disturbance

Mountain pine beetle infestation has changed forest 

structure and composition; Small pine trees must compete 

for limited resources in dense young stands, potential 

stagnation is slowing growth. Stems remain thin, and 

heavy snow can result in widespread damage.

Habitat and scenery diversity; Insect and fire 

regulation

By associating the current needs of the landscape, with relevant ecological processes, it is clear 

that insect and fire regulation as well as having diverse habitat and scenery are the overlapping 

benefits that are critical to this landscape. 
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Environmental Consequences

This section summarizes the potential direct, indirect and cumulative impacts of the proposed 

action and alternatives. The scientific and analytical basis used for comparing alternatives under 

both the ecosystem services and regional economic contribution frameworks are first presented, 

followed by analysis of the environmental consequences of Alternative A – Proposed Action 

and Alternative B – No Action.

Analysis Framework, Methodology and Assumptions

Ecosystem Services

Ecosystem Services are components of nature that contribute to human well-being. This concept 

intends to bring explicit awareness and recognition the various ways humans benefit from and 

depend on the natural world. This dependency extends from essential support for life (oxygen, 

water and food) to security (e.g., natural regulation of insects, disease, and fire regime) and 

quality of life (scenic beauty and other cultural services such as outdoor recreation and spiritual 

values).

Multiple values and benefits are associated with the maintenance of ecological processes that are 

the focus of this project (insect and disturbance regulation and diverse forest structure and 

composition). Besides the more apparent, if not immediate, benefits of thinning or removal of 

beetle-infested trees (to reduce hazard to public health and safety, infrastructure, and 

communities), other benefits centered on the premises that not having large areas of forest that is 

all alike will (1) decrease susceptibility to widespread fire and insect infestation in the future, and 

(2) provide varied habitats for wildlife and scenery (recreation values). 

(1) Forest structural diversity and resilient ecosystems

Resilient ecosystems have greater capacity to survive disturbances and large-scale threats such as 

wildfire and beetle infestation, especially under changing and uncertain future environmental 

conditions. Maintaining and perpetuating ecological resilience is critical in order to achieve 

sustainable multiple use management and provide a broad range of ecosystem services. When 

viewed over an appropriate time span, a resilient forest ecosystem is able to maintain its 

‘identity’ in terms of taxonomic composition, structure, ecological functions, and process rates.

For similar site types, diverse forests are both more resistant (remain unaltered in the face of 

chronic change) and more resilient than those with less diversity (Stone et al. 1996). The 

available scientific evidence strongly supports the conclusion that the capacity of forests to resist

change, or recover following disturbance, is dependent on biodiversity at multiple scales –stand, 

landscape, ecosystem, bioregional (Thompson et al. 2009). This project primarily focuses on 

forest structural diversity at the stand and landscape scales.

(2) Forest structural diversity and wildlife habitat. 
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Diversified structural features provide varied recreational values as well as critical habitat 

components for forest-dwelling wildlife species. For example, vertebrate habitat diversity is 

associated with forest structure (Urban and Smith 1989; Hansen et al. 1995). In addition, it may 

be that structural characteristics, not plant species composition, are the primary determinants of 

avian community diversity (MacArthur and MacArthur 1961). 

Regional Economic Contribution

Economic contributions (jobs, labor income and GDP) are estimated using input-output analysis. 

Input-output analysis is a means of examining relationships within an economy, both between 

businesses and between businesses and final consumers. It captures all monetary market 

transactions for consumption in a given time period. The resulting mathematical representation 

allows one to examine the effect of a change in one or several economic activities on an entire 

economy, all else constant. This examination is called impact analysis. The IMPLAN®

modeling system allows the user to build regional economic models of one or more counties for 

a particular year. The model for this analysis employed 2014’s IMPLAN data2

. IMPLAN

translates changes in final demand for goods and services into resulting changes in economic 

effects, such as labor income and employment of the affected area’s economy.

The economic effects are measured by estimating the direct jobs and labor income generated by 

the processing of the timber volume from the project. The direct employment and labor income 

benefit employees and their families and, therefore, directly affect the local economy. 

Additional indirect and induced multiplier effects (ripple effects) are generated by the direct 

activities. Indirect effects are felt by the producers of materials used by the directly affected 

industries. Induced effects occur when employees of the directly and indirectly affected 

industries spend the wages they receive. Together the direct and multiplier effects comprise the 

total economic contributions to the local economy. 

The direct effects were estimated using direct response coefficients developed from a national 

Timber Mill Survey conducted by the University of Montana’s Bureau of Business and 

Economic Research (BBER) (Table 3). BBER timber response coefficients (also known as 

Keegan Timber Mill Survey Response Coefficients) are broken into multi-state regions, data for 

the region covering Wyoming and South Dakota are used in this analysis. Along with these 

direct Keegan coefficients, a Forest Service model specifically constructed (using county-level 

IMPLAN data) for the BHNF zone of influence is then used to model the total economic 

contribution of timber harvest.

 2 the latest licensed IMPLAN data available to US Forest Service analysts at the time of the DEIS
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Table 3 Keegan Timber Mill Survey Response Coefficients for Wyoming and South Dakota 

Direct Response Coefficients

Industry Sector Employment (jobs 

per MMCF)

Income ($2014 

dollars per 

MMCF)

Forestry and Logging 14 $588,000

Softwood Sawmills 12 $492,000

Other Timber Products 15 $525,000

Facilities Processing Residue From Sawmills 4 $164,000

For the No Action Alternative, the 5-year average annual cut volume (CCF) are obtained from 

USFS Cut and Sold Report for the BNNF, and used as model inputs in order to estimate the 

regional economic contribution of timber harvest given recent volume (Table 1). For the purpose 

analyzing the regional economic contributions under the Proposed Action, the total estimated

volume from the Action Alternative is estimated at 678,000 CCF, to be harvested over 4 years, 

starting in 2019.

Alternative A – Proposed Action

Direct, Indirect, and Cumulative Effects – Ecosystem Services

The concept of Final Ecosystem Goods and Services (FEGS) is a useful foundation for defining, 

classifying, and measuring ecosystem services. FEGS focuses less on those regulating and 

supporting services, and more on components of nature, directly enjoyed, consumed or used to 

yield human well-being (Boyd and Banzhaf 2007), and places great emphases on linking specific 

beneficiaries with services. While the objectives of this ecosystem restoration project relate more 

toward supporting or regulating services (forest insect and disturbance regulations), it is still 

worthwhile to point out the many values human would ultimately benefit from.

Multiple values and benefits received by various end users are associated with the maintenance 

of ecological processes that are the focus of this project (insect and disturbance regulation and 

diverse forest structure and composition). By adopting the concept of Final Ecosystem Goods 

and Services (FEGS), this analysis relates the most critical processes (fire and insect regulation) 

associated with the Proposed Action with relevant beneficiaries. Four general groups of 

beneficiaries are identified: 

• General public safety from reduce risk of wildfire to landscapes and structures 

• People interested in the provision of timber source, including the consideration for 

future harvesting opportunities (option values)
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• People interested in having a diverse habitats for their scenic / recreational value, 

in addition to having decreased risk to widespread fire and insect infestation in 

general.

• People interested in the preservation of wildlife – both use (hunting, wildlife 

viewing) and passive values (knowing the existence of wildlife species supported 

by a diverse pine forest habitats).

Overall, the Proposed Action would benefit the groups above either directly or indirectly, by way 

of achieving various ecological outcome or intended effects. The following table summarizes the 

intended outcome associated with management actions under Alternative A, as well as the 

ecological challenges these action aim to address. Some actions will provide commercial timber

for processing, generating regional economic contributions. Those contributions are discussed in 

the next section. 

What are the Landscape 

Needs and Challenges?

How does the Proposed Action address the 

needs to restore and maintain ecosystem 

resilience (fire and insect regulation, habitat 

and scenery diversity)

What are the ecological outcome or 

intended effects?

Wildfire risks on NFS and 

non-NFS lands caused by 

beetle infestation and past 

fire suppression efforts. The 

need for returning 

landscape to the natural fire 

disturbance that native 

species evolved with.

Mechanical and manual fuel treatments

Reduced the potential of dead trees burning 

intensely, damaging soils and causing 

problems for firefighters

Commercial thin

Thinning out small pine trees (not fire 

resistant) to reduce dense patches, 

preventing potential vertical and horizontal 

fire spread. Provision of timber for 

processing (see Economic Contribution

section)

Prescribed fire

Reduced fuel buildup; returning landscape 

to the natural fire disturbance process that 

native species evolved with.

Hazard tree treatments

Reduced risk of trees falling on open roads 

or trails, structures, private property, or 

critical infrastructure

Old hardwood stands and 

grasslands losing vigor or 

disappearing caused by pine 

encroachment, declining 

aspen. The need for 

maintaining aspen and oak 

stands for their fire and 

insects resistant properties.

Aspen maintenance and enhancement (cut or 

burn encroaching / declining pine)

Maintaining aspen stands that are fire and 

insects (pine beetle) resistant; providing 

habitat and scenery diversity 

Removal of encroaching pine from oak stands

Maintaining oak stands that are fire and 

insects (pine beetle) resistant; providing 

habitat and scenery diversity 

Removal of encroaching pine from grasslands

Provides habitat diversity and scenery
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Indirect, and Cumulative Effects – Economic Contributions

Regional economic contributions are measured by estimating the direct jobs, labor income and 

contributions to GDP generated by the processing of the timber volume from the project. The 

direct employment and labor income benefit employees and their families and, therefore, directly 

affect the local economy. Additional indirect and induced multiplier effects (ripple effects) are 

generated by the direct activities. Indirect effects are felt by the producers of materials used by 

the directly affected industries. Induced effects occur when employees of the directly and 

indirectly affected industries spend the wages they receive. Together the direct and multiplier 

effects comprise the total economic contributions to the local economy.

The goal for commercial treatment in SS 4A stands is approximately 187,000 acres. On-theground condition as well as budgetary limitation will ultimately dictate the amount of product 

removed, but current estimate of potential timber volume is 678,000 CCF. For the purpose of this 

analysis, it is assumed that harvest will spread out over 4 years, starting in 2019. Specifically, the

Input-Output model estimates job, income and GDP contributions in the area of influence based 

on the assumption that the majority of potential timber volume associated with Alternative A will 

be harvested during the implementation period (approximately 169,100 CCF per year, for 4

years).

Given these specifications, Alternative A is estimated to support over 1,300 jobs, $55 million in 

total labor income, and $64 million in GDP contribution for the local economy on an annual 

average basis. Table 4 displays the direct, indirect and induced, and total estimates for 

employment (part and full-time), labor income and GDP contribution that may be attributed to 

the Proposed Action. It is important to note that these may not be new jobs or income, but rather 

existing jobs and income in the regional economy that are supported or sustained by this project. 

Mountain pine beetle 

infestation has changed 

forest structure and 

composition; Small pine 

trees must compete for 

limited resources in dense 

young stands, potential 

stagnation is slowing 

growth. Stems remain thin, 

and heavy snow can result 

in widespread damage.

Convert some mature stands (SS4A) to young 

stands by removing some or all of the mature 

trees.

Moving toward Forest Plan objectives for 

SS4A and other structure stages. 

Fuel treatments in existing SS4C stands. Increase dense mature forest stands (SS4C)

Thinning or burning understory vegetation in 

some existing late successional SS5 stands.

Maintain or enhance late succession 

characteristics and increase stand resilience

In areas where grass/forb (SS1) is below Plan 

objective, patch cut to produce more SS1 Moving toward Forest Plan objectives for 

SS1 In areas where grass/forb is above Plan 

objective, plant trees in large burned areas to 

facilitate reforestation

Precommercial thinning small tress in young 

stands 

Increase the vigor of remaining saplings and 

to prevent stagnation
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Table 4. Annual average employment, labor income and GDP 

contributions from timber harvest under Proposed Action

(during 4-year implementation period, starting in 2019)

Employment

Direct 549

Indirect and Induced 809

Total 1,358

Labor Income (2015$)

Direct $23,745,304

Indirect and Induced $31,684,847

Total $55,430,151

Contribution to GDP (2015$)

Direct $24,082,002

Indirect and Induced $40,343,267

Total $64,425,269

* Employment is the total full- and part-time wage, salaried, and self-employed jobs 

in the region.

**Labor income includes the wages, salaries and benefits of workers who are paid by 

employers and income paid to proprietors.

Since the model assumed that total timber volume associated with the Proposed Action would 

occur over a 4-year period, estimates of average annual part-time and full-time jobs shown in 

Table 4 are heavily dependent upon harvest implementation. If the actual implementation period 

is shorter, more jobs would be supported over a shorter period of time. Conversely, if the 

implementation period is expanded, fewer jobs would be supported annually but for a longer 

period of time. Also, within the implementation period of a project, the numbers of jobs 

supported may or may not be filled by the same personnel nor distributed evenly over time, 

depending upon the nature of the project, turnovers, number and type of firms involved and other 

factors. Therefore, it would be misleading – or, not meaningful at best – to calculate a ‘total 

employment over the life of the project’ figure. Due to these issues, readers are further cautioned 

against multiplying the average annual employment number(s) as presented below, with the 

project implementation timeframe (years) in an attempt to arrive at the ‘total employment over 

the life of the project’ figure.

These regional economic contributions estimates are associated with the Proposed Action, and 

do not include those other jobs and income effects associated with ongoing and planned timber

harvest, those currently scheduled for sale, as well as those that have been sold but not yet cut.

It should be noted that IMPLAN’s method of reporting employment as annual averages means 

that one cannot discern the number of hours worked or the proportion that is full time vs. part 

time. This method of accounting means that one job lasting 12 months = two jobs lasting six 

months each = three jobs lasting four months each. Each of those examples would appear as one 

job in IMPLAN and as reflected by the above results. 
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It is therefore helpful to consider employment figures shown in Table 4 as the ‘cumulative’

employment effects / requirement across different sectors in the local economy, associated with 

the proposed activities (in this case those direct, indirect and induced labor necessary to support 

the harvest of 678,000 CCF, or an annual average of 169,500 CCF). In other words, ‘one job’ as 

reported in IMPLAN may be a collection of different jobs (e.g. ‘one job’ may be the summation 

of 1 full-time equipment operator working 3 months + 1 full-time driver working 3 months + 2

half time office support staffs working 6 months each).

It is also important to note that there will be additional jobs, labor income and GDP contributions 

associated with other restoration related activities (those without product removal components). 

Because restoration firms also incur various expenditures (labor costs, fuel, equipment, etc.) 

associated with BHNF contracted activities. The direct ecosystem restoration employment and 

labor income benefit employees and their families; while additional indirect and induced 

multiplier effects (ripple effects) are generated by, or associated with various direct restoration 

activities, from mechanical and manual fuel treatments, to thinning or burning understory 

vegetation.

Alternative B – No Action

Direct, Indirect, and Cumulative Effects – Ecosystem Services

Under No Action, all other ongoing and planned activities would continue to occur. While 

limited fuel and hazard tree treatments, hardwood and grassland enhancement, or other activities 

that may modify pine structural stage directly or indirectly could still occur through other project 

level activities on the BHNF, they will likely not be at the same extents as proposed under 

Alternative A. Therefore, the beneficiaries discussed above will not receive the same magnitude 

of benefits. 

In sum, the following current landscape needs and challenges on the Black Hills National Forest 

will not be addressed on the same coordinated level or extent as proposed by the Action 

Alternative. 

Landscape Needs and Challenges not Addressed under 

Alternative B – No Action

Relevant Ecosystem Services, Processes, 

Structure and Function

Wildfire risks on NFS and non-NFS lands caused by beetle 

infestation and past fire suppression efforts. The need for 

returning landscape to the natural fire disturbance that 

native species evolved with.

Regulations of insect infestation and other 

natural disturbances (the spread of beetle 

infestation has slowed down due to insects 

running out of forest to infest)

Old hardwood stands and grasslands losing vigor or 

disappearing caused by pine encroachment, declining 

aspen. The need for maintaining aspen and oak stands for 

Habitat and scenery diversity; ecosystem 

resilience to disturbance
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their fire and insects resistant properties.

Mountain pine beetle infestation has changed forest 

structure and composition; Small pine trees must compete 

for limited resources in dense young stands, potential 

stagnation is slowing growth. Stems remain thin, and 

heavy snow can result in widespread damage.

Habitat and scenery diversity; Insect and fire 

regulation

Indirect and Cumulative Effects – Regional Economic Contributions

The No-Action alternative would not harvest timber or accomplish other product removal 

activities associated with fuel and hazard tree treatments, hardwood and grassland enhancement 

or pine structural stage modification objectives as described under the Proposed Action.

Therefore, Alternative B will incur no immediate / direct financial costs nor produce any revenue 

from an Agency perspective, and make no contributions in terms of GDP, jobs or income to the 

local economy.

However, all other ongoing and planned activities would continue to occur, including timber 

currently scheduled for sale, and those that have been sold but not yet cut, will occur as planned. 

For the purpose of this analysis, if future cut volume similar to those described in the Existing 

Condition section can be sustained, all else equal, then the annual average jobs, income and GDP 

supported directly and indirectly in the local economy would also likely be supported. On the 

other hand, if future harvest levels were to drop, then these economic contributions would also 

decrease accordingly, all else equal. Needless to say, future regional and national wood product 

demands will influence these economic contribution results. But with regards to commercial 

harvest from the Black Hills National Forest, it is not likely that the level of harvest in recent 

years can be sustained indefinitely into the future (see Timber Resources section).
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Literature Cited

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relationships in natural and managed forests in the West Cascades of Oregon. Ecological 

Applications 5:555–569.

MacArthur, R.H. and J.W. MacArthur. 1961. On bird species diversity. Ecology 42:594–598.

Stone L, Gabric A, Berman T. 1996. Ecosystem resilience, stability, and productivity: Seeking a 

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