United States

Department

of Agriculture

Forest Service

Rocky Mountain

Research Station

General Technical Report 

RMRS-GTR-205

December 2007

Assessing Post-Fire 

Values-at-Risk With a 

New Calculation Tool

David E. Calkin, Kevin D. Hyde, Peter R. Robichaud, 

J. Greg Jones, Louise E. Ashmun, Dan Loeffler
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Fort Collins, CO 80526

Calkin, David E.; Hyde, Kevin D.; Robichaud, Peter R.; Jones, J. Greg; Ashmun, 

Louise E.; Loeffler Dan. 2007. Assessing post-fire values-at-risk with a new 

calculation tool. Gen. Tech. Rep. RMRS-GTR-205. Fort Collins, CO: U.S. 

Department of Agriculture, Forest Service, Rocky Mountain Research Station. 

32 p.

Abstract

Wildfire effects include loss of vegetative cover and changes to soil properties that 

may lead to secondary effects of increased runoff, erosion, flooding, sedimentation, and vulnerability to invasive weeds. These secondary effects may threaten 

human life and safety, cultural and ecological resources, land use, and existing 

infrastructure. Current Burned Area Emergency Response (BAER) assessment 

procedures require identification and valuation of values-at-risk (VAR) from the potential secondary effects of wildfires. However, guidelines to estimate the monetary 

value of these resources are limited and difficult to apply. This project examined 

current methods for post-fire assessment of VAR and sought methodologies to 

standardize and simplify the complex valuation task. A spreadsheet-based “VAR 

Calculation Tool” supports this valuation framework. It is expected to improve defensibility of VAR valuation and post-fire emergency treatment decisions.

Keywords: Burned Area Emergency Response (BAER), Values-at-Risk, economic 

assessment, implied value

Rocky Mountain Research Station

Natural Resources Research Center

2150 Centre Avenue, Building A

Fort Collins, Colorado 80526

A B C

D E

F

G

H

Cover photo credits: A, C, E-G, Kevin Hyde

B-D courtesy of Bitterroot National Forest.
The Authors

David E. Calkin is a Research Forester in the Social, Economics, and Decision 

Science Program located at the Rocky Mountain Research Station’s Forestry 

Sciences Laboratory in Missoula, Montana. He develops processes and tools for 

assessing economic effects of wildland fire and fuel management activities.

Kevin D. Hyde works as a Landscape and Watershed Analyst and is under contract 

with the Social, Economics, and Decision Science Program located at the Rocky 

Mountain Research Station’s Forestry Sciences Laboratory in Missoula, Montana. 

He develops decision support systems for risk-based assessment of wildland fire 

and post-fire watershed response.

Peter R. Robichaud is a Research Engineer in the Air, Watershed and Aquatics 

Science Program located at the Rocky Mountain Research Station’s Forestry 

Sciences Laboratory in Moscow, Idaho. He has developed and implemented 

research protocols for measuring and predicting post-fire runoff and erosion and 

post-fire mitigation treatment effectiveness.

J. Greg Jones is a Research Forester in the Social, Economics, and Decision 

Science Program located at the Rocky Mountain Research Station’s Forestry 

Sciences Laboratory in Missoula, Montana. He develops processes and tools for 

assessing economic efficiency of proposed management activities at both the 

landscape and project scales.

Louise E. Ashmun is a Civil Engineer in the Air, Watershed and Aquatics Science 

Program located at the Rocky Mountain Research Station’s Forestry Sciences 

Laboratory in Moscow, Idaho.

Dan Loeffler is an Economist with the College of Forestry and Conservation at 

the University of Montana-Missoula in Missoula, Montana.

Acknowledgments

We gratefully acknowledge the U.S. Department of Agriculture, Forest Service 

(USFS) and the U.S. Department of Interior (DOI) Joint Fire Science Program 

for their support of the JFSP study of how Burned Area Emergency Response 

(BAER) teams determine the monetary value of resources, or values-at-risk from 

loss or damage by post-fire events, and the development of the Values at Risk 

(VAR) Calculation Tool (JSFP grant 05-01-01-09). We also wish to thank the hundreds of DOI and USFS personnel who completed the study survey and the BAER 

teams who allowed us to observe their work. Their patience with our questions and 

willingness to test ideas during post-fire assessments made development of the 

values-at-risk valuation process and support tool possible. We thank William Elliot, 

Greg Bevenger, Jeff Bruggink, Jeff TenPas, Keith Stockmann, and Sharon Ritter 

for their helpful reviews. Keith Stockmann and Dave Calkin conducted trial runs of 

the VAR Calculation Tool on the Poe Cabin and Lewis and Clark complex during 

the 2007 fire season.
Contents

Introduction............................................................................................................................. 1

Existing Approaches ......................................................................................................... 2

Economic Analyses Within the BAER Environment ......................................................... 3

Justification for VAR Valuation Framework....................................................................... 4

Recommended Approach ................................................................................................. 4

Valuation of Post-fire Values-at-Risk—A Conceptual Framework ..................................... 5

Threat versus Risk............................................................................................................ 6

The Process ..................................................................................................................... 6

Preparing to Use the VAR Calculation Tool—Obtaining the Input Parameters ................ 8

Identifying and Classifying VAR........................................................................................ 8

Mapping VAR-Threat Associations ................................................................................... 9

Probabilities of Threat Occurrence and Treatment Effectiveness....................................11

Treatment Costs ............................................................................................................. 14

Using the VAR Calculation Tool .......................................................................................... 16

Welcome Page ............................................................................................................... 16

Gash Creek Fire Example .............................................................................................. 17

Gash Creek Fire Information .......................................................................................... 17

Preparation for VAR Valuation Within the BAER Process .............................................. 17

VAR Area Map Page....................................................................................................... 18

Map Zone Worksheets.................................................................................................... 18

Summary Page............................................................................................................... 26

Management Implications.................................................................................................... 28

Procedures and Planning for Effective VAR Calculation Tool Use ................................. 28

Support for Post-fire Treatment Decisions and Funding Requests ................................ 29

References ............................................................................................................................ 29

Appendix A—Calculations Within the VAR Calculation Tool ........................................... 31

ii
USDA Forest Service RMRS-GTR-205. 2007. 1

Introduction

Wildfire secondary effects include increased runoff, erosion, flooding, 

sedimentation, and vulnerability to invasive weeds. These secondary effects 

often pose threats of loss or damage to life, property, and resources. After 

wildfires, U.S. Department of Agriculture, Forest Service (USFS) and U.S. 

Department of Interior (DOI) Burned Area Emergency Response (BAER) 

teams evaluate the likelihood of threats occurring and recommend immediate actions, such as land treatments, road improvements, and warning 

systems, that will mitigate threats and reduce their impact.

The current guidelines for BAER team resource valuation procedures are 

very general (USDA Forest Service 2004, US Department of Interior 2004)

and difficult to implement given the limited time and information available 

for post-fire assessments (Calkin and others 2006). The final calculations are 

best described as estimates based upon professional judgment (Robichaud 

and others 2000). The current application of BAER treatment recommendations may not be defensible under the increased scrutiny associated with 

ongoing cost containment efforts.

Current BAER assessment procedures require identification and quantification of values-at-risk (VAR) from the secondary effects of wildfires, but 

guidelines to estimate the monetary worth of these values are lacking. The 

Forest Service Manual, Chapter 2523 (USDA Forest Service 2004) and the 

DOI Manual, Part 620n Chapter 3 (US Department of Interior 2004) call for 

BAER assessment teams to submit reports and funding requests that establish justification for treatments through “cost-risk analysis.” In the case of 

the USFS, the BAER team is referred to the “cost-risk analysis worksheet” 

that requires four basic inputs: 1) probability of the threat occurring without 

treatment, 2) cost of mitigation treatments, 3) probability that the threat will 

occur with treatment, and 4) monetary worth of resources at-risk. Recent 

work, funded by the Joint Fire Science Program, has resulted in the development of the Erosion Risk Management Tool (ERMiT) that can predict 

two of those four inputs in terms of post-fire erosion—the probabilities of 

the threat occurring without and with treatment for some common post-fire 

treatments (Robichaud and others 2006, Robichaud and others 2007). Recently, a comprehensive post-fire treatment guide has been compiled, which 

includes available treatment installation instructions, effectiveness information, and cost ranges (Napper 2006); however, this information has not 

been incorporated into the cost-risk analysis worksheet. A methodical and 

efficient valuation procedure that can provide realistic, reproducible, and 

defensible cost-value amounts for the identified post-fire VAR is needed.

The increased scrutiny of all wildfire related expenditures requires improvements in benefit-cost accounting systems, including methods to assess 

values-at-risk. Working under tight timelines, prior to implementing emergency response treatments, BAER teams are required to demonstrate that 

the worth of values to be protected exceeds the costs of the treatments to 

be applied. Three fundamental limitations compromise effective calculation of resource values-at-risk: 1) current valuation guidelines are unclear, 

2) BAER team members typically have limited training and experience in 

the field of economics, and 3) data to support direct valuation of specific 

resources, particularly non-market resource values (for example, sensitive 

wildlife species, undeveloped recreation, cultural artifacts), are not consistently available.
2 USDA Forest Service RMRS-GTR-205. 2007.

BAER team applications of available valuation guidelines and procedures vary between fires and produce inconsistent, non-repeatable analyses 

subject to local bias (Calkin and others 2006). Valuation is hindered by 

lack of relevant and complete value data. Furthermore, the types of values 

threatened vary substantially between incidents and the valuation data necessary to complete the calculations may not be accessible within the 7 days 

allocated to completing initial requests for emergency response funding. 

Finally, the science to support calculation of non-market values is not sufficiently developed to support calculating monetary worth in the short time 

frames that constrain BAER team analyses.

In this GTR, we describe a clear and reproducible valuation procedure 

that can improve the documentation and defensibility of values-at-risk calculations and cost-risk analyses. This VAR valuation framework describes 

procedures already used by most BAER teams. The proposed methods were 

developed from direct field observation, surveys with BAER personnel, and 

recognition of the challenges of the BAER analysis environment.

The Forest Service manual for BAER team operations is currently being 

rewritten for 2008, which provides an opportunity for the agency to determine what VAR will be covered under the BAER program. This manual 

and equivalent DOI manuals should provide guidance regarding the values 

that have been authorized for protection through the BAER program. Any 

treatment that is recommended within the BAER assessment must have a 

primary purpose of protecting an authorized BAER value.

Existing Approaches

Currently, USFS and DOI BAER teams use different approaches for 

cost-risk analysis. USFS BAER teams apply a quantitative approach using 

benefit-cost analysis, which requires that the expected benefits (or negative 

outcomes avoided) of the treatment be assigned a monetary value. If the 

identified benefits (multiplied by the probabilistic reduction in experiencing 

the negative outcome) calculated in dollars exceeds the costs of a proposed 

treatment, the activity is justified (in other words, Benefits (B) divided by 

Cost (C), or the B/C ratio >1). When the resources to be protected can be easily assigned monetary values, such as transportation infrastructure (roads, 

culverts, and bridges) and timber or grazing leases, benefit-cost analysis 

is relatively straight-forward and data requirements are not overly burdensome. However, data are often unavailable to quantify the resource benefits 

of a proposed treatment when the affected resources are non-market values. 

In these instances, BAER team members may rely on indirect methods to 

assess values. For instance, if a high intensity rainfall event would result 

in substantial top soil loss, the team may assign the value of the resource 

to be protected as the cost of replacing the lost top soil—independent of 

the values derived by society from the pre-erosion environment. This indirect approach would be appropriate if the restoration treatment described 

would realistically be undertaken to replace or repair the damaged resource. 

However, it is unlikely that eroded forest top soil would be replaced, and 

therefore, this valuation, like many indirect valuations, is not defensible. 

Without clear, reliable resources or guidelines, BAER teams may assign 

monetary values to non-market VAR based on professional judgment and 

past practice. Given the limited literature on monetary value change to nonmarket resources due to damage from post-fire events and the challenges 
USDA Forest Service RMRS-GTR-205. 2007. 3

of transferring existing research to new areas, there is reason for concern 

regarding the validity of these estimates.

Within the current BAER process, benefit-cost analysis is typically completed near the end of the analysis, making manipulation of benefit-cost 

analysis to justify proposed treatments a valid concern. Additionally, the 

USFS procedures aggregate the total benefits and treatment costs for all the 

BAER recommendations irrespective of any relationship (or lack of relationship) between the various threats, VAR, and mitigation treatments. This can 

result in treatments that are not economically justified (B/C ratio <1) being 

subsidized by unrelated, but highly justified (B/C ratio >>1) treatments.

DOI BAER teams apply qualitative analysis ranking the relative importance of the resources to be protected. The qualitative approach is 

straight-forward and simple to implement. However, it does not inform 

decision-making on the most important question posed to BAER teams: 

should a treatment be implemented or not? Qualitative analysis does not 

demonstrate that a proposed treatment is economically justified and therefore an appropriate investment of public funds.

Economic Analyses Within the BAER Environment

Economic analysis for BAER teams requires evaluating the risk to resources that may be affected by post-fire events. Finney (2005) identifies 

wildfire risk as the product of the likelihood of an event of a given intensity 

(threat) times the net value change to the affected resource at the given 

intensity. However, in current cost-risk worksheets, post-fire responses frequently are identified, but the specific resource value change is not specified 

(review of past 2500-8 Burned Area Reports by authors). For instance, the 

likelihood of a significant erosion event is not in itself a risk; the risk is the 

effect the erosion event will have on valued resources such as municipal 

water quality, wildlife habitat, and constructed infrastructure. Thus, effective cost-risk assessment necessitates that the probability of a given post-fire 

event is directly linked to potential damage or loss of valued resources.

Basic economic theory states that when traditional markets are clearly 

defined, commodity values usually are easily monetized. However, the values of natural ecosystems and ecosystem services are not easily monetized 

and have been subject to considerable academic debate. Ecosystem functions and the associated outputs of those functions (in other words, goods 

and services) are often referred to as having non-market characteristics. 

That is, there is no clear definition of existing markets, no buyers and/or 

sellers, and therefore no equilibrium prices or dollar values assignable to 

those ecosystem functions. Further, when traditional markets do not exist, 

inefficient resource utilization and damage is likely without government 

intervention (Pigou 1938).

Although there is a substantial body of research on assigning monetary 

values to forest and rangeland resources, very few of these authors identify 

the change in value associated with fire or post-fire events (see Venn and 

Calkin 2007 for a review of the challenges of non-market valuation within 

the fire environment). In the absence of site specific values for non-market 

resources, analysts can attempt to use benefit transfer methods (Rosenberger and Loomis 2001). Benefit transfer refers to the adaptation of economic 

information from a specific site and/or resource to another site with similar resources and conditions. Benefit transfer is a practical way to produce 

resource valuation estimates when comprehensive research for the site or 
4 USDA Forest Service RMRS-GTR-205. 2007.

resource in question is unavailable. However, there are a number of strict 

requirements that must be met to have confidence in the applicability of 

benefit transfer methods. These requirements, and the limited number of 

primary research studies from which to transfer monetary valuations, restrict the application of benefit transfer methods in BAER analyses.

Justification for VAR Valuation Framework

We developed and present in this publication new tools and methods to 

assess values-at-risk in response to the need for an appropriate valuation of 

post-fire VAR and economic justification of BAER treatment expenses. The 

Cost Risk Assessment process used by USFS-BAER is difficult to apply to 

VAR that cannot be evaluated in strict monetary terms. Ranking the perceived value of identified VAR, the valuation system used by DOI-BAER, 

does not provide any economic justification for treatment recommendations. 

In response, we have developed this VAR Calculation Tool. The use of the 

VAR Calculation Tool not only provides common methods for use by both 

agencies, but it has the potential to provide less subjective, more consistent 

(between fires and agencies), and more defensible post-fire emergency assessments for justifying mitigation treatments.

For experienced BAER personnel, the use of the VAR Calculation Tool 

to implement the VAR valuation framework may initially be more time-intensive than past practice. However, we expect that attention to procedural 

and planning elements and some practice with the VAR Calculation Tool 

will quickly make this process efficient. In addition, the VAR Calculation 

Tool supports a consistent process that is not dependent on knowledge of 

past practice and will allow new, less experienced team members to function as effectively as their more-experienced peers. The VAR tool will also 

assist BAER teams in targeting their analyses to those areas where identified VAR exist, which may decrease the time required to complete the 

overall analysis following fires.

Recommended Approach

Based on our review of the relevant literature and the assessment challenges of the BAER environment, we recommend a hybrid approach for 

valuation of VAR and proposed treatments during post-fire assessments: a 

benefit-cost analysis would be used where monetary values are readily available and an Implied Minimum Value (IMV) would be assigned to averting 

loss of non-market resources. IMV equals the treatment cost divided by the 

reduction in likelihood of experiencing the negative outcome:

IMV = Prob (loss occurring with no treatment) - Prob (loss occurring with treatment)

treatment cost ( (

The IMV does not necessarily represent the actual dollar value of the 

resource loss averted—in fact, the true monetary value need not be defined. 

The IMV provides a value that the described non-market resource must 

exceed to suggest that a treatment is an efficient use of taxpayer dollars. 

Thus, the lower an IMV, the more likely the value of the described resource 

exceeds this IMV. Use of the IMV to justify a post-fire treatment funding request reflects the BAER team’s assessment that avoiding potential 
USDA Forest Service RMRS-GTR-205. 2007. 5

damage to the described resource is worth at least the IMV, and therefore, 

the proposed treatment is a wise investment of public funds. Managers review and approve BAER funding requests and, as a result, they must also 

determine if the treatment expense is an appropriate use of public funds. 

We recommend that BAER teams provide sufficiently detailed descriptions 

of non-market resources deemed worthy of protection so that others, who 

are not in close proximity, can realistically evaluate the IMV. This hybrid 

approach integrates the qualitative assessments currently used by DOI with 

components of the quantitative procedures required by the USFS. The use 

of IMV removes the USFS requirement of assigning monetary values to 

non-market resources and does not require USFS BAER teams to acquire 

any additional data beyond current requirements.

When comparing alternative treatment programs or additive treatments 

to protect an identified non-market VAR, the program with the lowest IMV 

is typically the preferred alternative. However, in the case of a unique and 

highly important non-market VAR, the concept of acceptable risk may need 

to be evaluated, and treatment programs with higher IMV but lower posttreatment threat may be preferred to programs with a lower IMV but a higher 

post-treatment threat. For example, an isolated section of critical spawning 

habitat for an identified T&E species, whose loss could result in species 

extirpation, may suggest a very low level of acceptable risk. Therefore, a 

treatment program that reduces the likelihood of loss from the non-treatment 

level of 55 percent to 5 percent at a treatment cost of $250,000 (resulting 

in an IMV of $500,000) may be preferred to a treatment that reduces likelihood of loss to only 30 percent at a treatment cost of $25,000 (resulting in 

an IMV of $100,000). The more expensive treatment (and greater IMV) is 

preferred because the value of the habitat is deemed to exceed $500,000 and 

a 30 percent likelihood of loss is considered unacceptable.

The following sections will detail a framework for assessing VAR including: 

1) identification and classification of VAR coupled with threats, 2) estimating the probabilities of the occurrence of post-fire threats and treatment 

success, 3) performance of benefit-cost and IMV analyses to justify treatment recommendations, and 4) application of the VAR Calculation Tool to 

support use of the VAR valuation framework in an example. The VAR Calculation Tool compares and summarizes values-at-risk, associated threats, 

and proposed treatments based on resource economics. The final section 

discusses management implications of using this VAR valuation framework 

and how the framework may fit with expected trends in BAER reporting, 

funding, and integration with other aspects of fire management.

Valuation of Post-fire Values-at-Risk—A Conceptual 

Framework

This VAR valuation framework explicitly describes procedures already 

used by most BAER teams and will impact the order in which tasks are done 

more than it will change the tasks themselves. A prescribed procedure and 

tool for valuation of VAR will focus training and make the BAER process 

more efficient and transparent. This will be particularly valuable for new 

personnel, individuals with infrequent BAER responsibilities, and groups 

working together for the first time.
6 USDA Forest Service RMRS-GTR-205. 2007.

Threat versus Risk

Use of the proposed framework and support tools will focus post-fire assessments on consequences rather than causes. Characterization of the VAR 

and how threats could impact VAR will drive the post-fire assessment process. 

The initial question facing a BAER team will shift from, “What fire-induced 

changes to the landscape now threaten resources?” to “What resources are 

threatened by landscape changes and what are the potential losses?”

This shift in emphasis requires that threat be clearly differentiated from 

risk and from values-at-risk (VAR). By definition, threat is the potential 

to inflict injury or damage, and risk is the probability of a loss occurring. 

Values-at-risk are the values or resources at-risk of damage or loss. Responses to a recent survey by 214 BAER personnel revealed some of them 

commonly confused threats and VAR (table 1). We expect that differentiation of threats and VAR would focus field assessments and could make field 

time more efficient. For example, an area of high burn severity, as represented by a burned area reflectance classification (BARC) image, would not 

necessarily need to be validated for soil burn severity if no identified VAR 

are associated with that burned area. In addition, cautious use of the word 

hazard, often used in the context of both threats and risks, is necessary for 

clear communication. Hazard, similar to threat, refers to a source of danger 

or chance that an outcome will occur. Unless a valued resource is in harm’s 

way, a hazard, like a threat, poses no risk.

Table 1. Examples of threats and values-at-risk that are often confused.

Threat (hazard) Values-at-Risk

Noxious weeds Native vegetation

Ecosystem diversity

Natural forage materials

Soil erosion Life and safety

Water quality

Culverts and road system

Landslide Campground buildings

Road structure

Road use

Aquatic habitat

The Process

At the outset of the BAER assessment process, the BAER team identifies 

VAR and spatially couples them to probable threats. The team estimates 

the probabilities of threats occurring in the current post-fire environment 

as well as the probabilities of threat once a proposed treatment has been 

implemented. Dollar values for market VAR are obtained from engineers 

and other sources. The team determines benefit/cost ratios and IMV for 

all treatment options (table 2). With the exception of calculating the IMV 

of non-market VAR (Step 8, Table 2), most activities in this framework 

are typical components of current BAER assessments. However, the order 

and the intentional nature of each step likely reflect procedural changes as 

compared to current practice (table 3). These procedural changes provide 

a coherent and consistent treatment justification process that is explicitly 

described and supported by the VAR Calculation Tool.
USDA Forest Service RMRS-GTR-205. 2007. 7

Table 2. The VAR valuation framework steps as implemented with the VAR Calculation Tool.

Step Process Leading questions Examples

1a Identify VAR with associated What resources are threatened and life and safety, homes, roads, culverts,

threats where are they relative to burned cultural artifacts, and critical habitat

 areas?

1b What are the post-fire threats, given high erosion risk at head of very steep

 wildfire effects, topography, and drainage with friable soils

 climate?

2 Map VAR-threat associations Where and how are threats posed to burned areas are 2 miles directly

 critical VAR spatially linked? upstream from municipal water supply 

 intake

3 VAR valuation What is the estimated dollar value cost to replace, repair, or restore

 of each market VAR?

4 Mitigation plan What treatments might mitigate straw mulch, erosion barriers, culvert

 threats to VAR? upgrades, check dams

5 Treatment costs What is the cost to implement cost per acre to aerial mulch with straw

 treatments?

6 Effectiveness analysis How much will treatments reduce mulching treatment reduces the

 the likelihood of a threat occurring probability of damage to VAR from 70

 and/or damage to VAR? to 20 percent (0.7 to 0.2)

7 Benefit-cost Are market VAR sufficient to justify B/C of upsizing an existing culvert and

 cost of proposed treatments given preventing road damage $28,000 at a

 the probable success of treatments? cost of $16,000 reducing the risk of loss

 from 90 to 30 percent

 B/C = loss *Δ Pr(loss)

 cost($) =

 $28,000 *(.9-.3)/$16,000 = 1.1

8 Implied Minimum Value Are non-market VAR sufficient to IMV of bull trout spawning habitat

 justify cost of proposed treatments associated with a $10,000 treatment

 given the probable success of reduces the likelihood of loss from 70 to

 treatments? 20 percent?

 IMV = treatment costs($)

 Δ Pr(loss) =

 $10,000/(0.7-0.2)= $20,000

Table 3. VAR valuation framework procedural changes and rationale.

Procedural change Rationale

1. Formally itemize draft list of - Focus field work on VAR and associated threats

identified VAR at the first BAER team - Begin acquiring dollar values for market VAR at outset of a BAER process

meeting

2. Spatially link all VAR with associated - Linking specific threats to VAR prevents highly cost-effective treatments in one

threats and map the VAR-threat area being used to justify non-cost-effective treatments in another area

associations - Maps add strong support to “where” and “why” treatments are justified

- Maps serve as a reference for treatment monitoring

3. Provide qualitative descriptions of the - Reducing substantial threats to life and/or safety are necessary and justified

threats to life and safety and VAR-threat - Assigning dollar values to non-market VAR is not feasible in the short time

associations for non-market VAR frame allotted for post-fire assessment

- IMV (derived from the cost of treatments and the likelihood of reduced loss) 

provides a sufficient value statement to justify treatment decisions
8 USDA Forest Service RMRS-GTR-205. 2007.

Preparing to Use the VAR Calculation Tool—

Obtaining the Input Parameters

The majority of the time and effort needed for completion of the VAR 

valuation and treatment justification is spent on obtaining the following 

needed input parameters for the VAR Calculation Tool: 1) the identification 

and classification of VAR (life and safety, non-market, and market), and for 

market VAR, the estimate of the cost to repair, replace, or restore and/or 

value of loss of use; 2) threat assessment, including the probability that the 

threat will occur, and providing a spatial link to VAR; 3) a VAR Area Map, 

made by grouping related VAR-threat associations into Map Zones; and 

4) potential treatment recommendations, including costs of treatments and 

probabilities of threat occurring after the treatment has been implemented.

Identifying and Classifying VAR

The first step is to identify and categorize the VAR for loss or damage 

due to post-fire conditions and responses. Five categories of VAR are considered:

1. Life and safety

2. Non-market: Cultural (for example, archeological artifacts; sacred lands; 

historic buildings)

3. Non-market: Ecological (for example, water quality; protected species 

and associated habitat)

4. Market: Direct (for example, bridges; buildings; roads; culverts; timber 

and grazing permits)

5. Market: Loss of use (for example, access to a fishing lodge and supporting 

businesses)

The significance of protecting human life and safety is assumed selfevident. Therefore, it is not included in calculations to justify treatments.

Many non-market values are difficult, if not impossible, to replace at any 

price and, as stated in the introduction, have “no clear definition of existing markets.” The distinction between cultural and ecological non-market 

resources reflects the convention of discriminating between cultural-based 

human values and values humans place on the natural world. While economic methods exist to estimate the monetary value of some non-market 

VAR, the time and expertise needed is typically not available to post-fire 

assessment teams. Further, some suggest that ethical, social, and moral 

arguments make the assignment of dollar values to these non-market resources inappropriate. Thus, in this VAR valuation framework, no direct 

assignment of dollar values to non-market VAR is done. Instead, an indirect 

approach, where the VAR is qualitatively described and assessed in terms of 

its IMV, is used to justify treatment.

The VAR Calculation Tool can be downloaded from the Moscow Forestry Sciences Lab: 

http://forest.moscowfsl.wsu.edu/BAERTOOLS
USDA Forest Service RMRS-GTR-205. 2007. 9

Market VAR are those resources that have established prices through 

available markets. Total costs to repair, rebuild, or purchase damaged or 

destroyed resources may be obtained from resource specialists, catalogues 

and publications, or professional quotes. Loss of use is a subset of market 

VAR where a service or facility cannot be used because of damage to the 

facility or to access routes to the facility. For example, a washed-out road 

could prevent access to a remote lodge or favored fishing area. The resort 

owners and associated service businesses would lose revenue until the road 

was repaired and reopened. It is often difficult to estimate the dollar value 

of these loss-of-use VAR and, if possible, an expert such as a Forest Service 

and or BLM regional economist may need to be consulted.

In all cases, the identified VAR should be explicitly linked to the threats 

that put the value at-risk for damage or loss. These VAR-threat associations

connect treatment costs to specific VAR protection, which clarifies and facilitates the VAR valuation process.

Mapping VAR-Threat Associations

An important input for the VAR Calculation Tool is the VAR Area Map, 

created by mapping polygons—one polygon for each identified VAR-threat 

association. Each polygon is referred to as a Map Zone (fig. 1), and the 

valuation of VAR in each Map Zone is calculated individually on separate 

worksheet pages within the spreadsheet based VAR Calculation Tool. This 

ensures that each VAR-threat association is evaluated on its own merits. 

The number of Map Zones needed for a BAER assessment will vary by the 

number and locations of VAR, as well as by the size and complexity of the 

wildfire.

When building Map Zones, the locations of critical habitats, cultural 

sites, bridges, culverts, and other VAR features are labeled with Map Link 

# identifiers. For example, six threatened road crossings are labeled D1 

through D6 in Map Zone D of figure 1. These Map Link numbers will be 

referenced within the VAR Calculation Tool. It is assumed that drainage and 

road networks, fire perimeters, and other relevant features will be included 

on the map. This provides a visual overview of the relationship between 

identified VAR and the burned area.

Using the burn severity map as a base, a Map Zone can be delineated by 

drawing a polygon that encloses the area containing a VAR or a cluster of 

related VAR and the associated threat(s). Geographic units, such as watersheds, areas adjacent to trails or roads, and contiguous habitats, rangelands, 

or forests, will likely form Map Zones of VAR-threat associations. Map 

Zones may be adjacent, separated, or overlapping. For example, the threat 

and the risk occupy the same area when invasive weeds (threat) are already 

established in an area with a threatened native plant species (VAR). In the 

case of snag trees lining a road or trail that provides sole access to an isolated community, the Map Zone is an elongated area with the travel route 

(VAR) surrounded by the snag source area (threat), such as shown in Map 

Zone A of figure 1. In a spatially separated example, the source area of a 

flood or debris flow hazard (threat) may be some distance upstream from 

the location of the public drinking water reservoir (VAR). The Map Zone, 

in this case, begins at the hydrologic divides of the burned watershed(s) and 

extends downstream to the reservoir (Map Zone B of fig. 1).

Map Zones may overlap where discrete VAR-threat relationships are 

clearly described and analyzed as separate units, such as Map Zones A and 
10 USDA Forest Service RMRS-GTR-205. 2007.

B in figure 1. Map Zone A defines a trail lined with burned “hazard trees” 

that must be cleared for safe access to install an Early Warning System to 

notify downstream residences that may be damaged by flooding. Zone B 

defines an area of flooding and erosion threats related to downstream VAR 

in a different drainage system than the threatened residences. The work necessary to clear the snags near the trail in Zone A will be unrelated to any 

work that might be proposed to address flooding and erosion threats in Zone 

B. The two analyses, despite their spatial overlap, will be different and unrelated.

Map Zones are compiled into a master VAR Area Map, providing a visual 

summary of all the identified VAR-threat associations for the burned area. A 

map inset may be necessary where VAR are outside the burned area, such as 

a threatened water supply many miles downstream from the burned area.

Figure 1. VAR Area Map worksheet from the VAR Calculation Tool showing the Gash Creek Fire example.
USDA Forest Service RMRS-GTR-205. 2007. 11

Probabilities of Threat Occurrence and Treatment Effectiveness

The VAR Calculation Tool, whether calculating the benefit-cost ratio (for 

market VAR) or the IMV (for non-market VAR), requires estimating the 

reduction of the probability of experiencing the post-fire loss due to the proposed treatment. This reduction is defined as the likelihood that the threat 

will occur under the no-action scenario minus the probability of the threat 

if the treatment is implemented, until the emergency post-fire threat has 

abated. Estimating these probabilities is easier for some threats and treatments than for others. For example, the potential erosion after fires can be 

estimated with erosion prediction models. The Erosion Risk Management 

Tool (ERMiT) (Robichaud and others 2006, Robichaud and others 2007), 

specifically designed for use by post-fire assessment teams, can provide the 

probabilities of erosion occurring and treatment success for several hillslope 

treatments (seeding, mulching, and erosion barriers). Tools and techniques 

to predict the probability that invasive weeds will move into a burned area 

are currently being developed, but are not readily available for use by postfire assessment teams. For some threats and treatments the probabilities of 

occurrence and treatment effectiveness will be “best guesses” based on past 

experience, monitoring results from past fires, research literature, treatment 

guides and catalogs (for example, BAERCAT—accessed at http://www.

fs.fed.us/eng/pubs/pdf/BAERCAT/lo_res/06251801L.pdf, Napper 2006), 

and expert opinion.

The size and probability of some threats to VAR occurring may be estimated using existing tools and modeling software. For example, the probability 

of post-fire landslides occurring may be evaluated with a stability model 

such as LISA (Hammond and others 1992). However, many models do not 

predict the probability of threat occurrence in the post-fire environment and 

far fewer can predict the probability of threat once a treatment has been 

implemented. Nonetheless, the professional judgment of the assessment 

team may be informed by the model input parameters (generally the most 

significant parameters related to the identified threat) and the model outputs 

(predictions). Thus, existing models and tools may provide guidance for assigning reasonable probabilities for use in the VAR Calculation Tool.

Currently, many teams include an estimate of the likelihood that a proposed treatment could be implemented prior to the damaging post-fire event 

that is being mitigated. If the post-fire event were to occur prior to the expenditure of the money on the treatment, the calculation of B/C ratio and 

IMV need not be adjusted. However, if the expenditures for the treatment 

have already occurred (for example, hillslope seeding has been completed 

but a post-fire rain event occurs prior to sufficient ground cover establishment), the reduction in the likelihood of loss due to treatment should be 

reduced by the probability that the treatment could be implemented and be 

effective prior to the post-fire event.

Erosion threat and erosion mitigation treatment effectiveness—Increases 

in post-wildfire runoff and erosion and resultant flooding and sedimentation 

are the most frequently encountered threats that must be evaluated by BAER 

teams (Robichaud and others 2000). USFS BAER teams are currently required to assess post-fire erosion and sedimentation potential regardless of 

any identified VAR (Part III, Burned Area Report, 2500-8). Treatments that 

increase the capacity to accommodate runoff and peak flows (for example, 

up-grading culverts, armoring fill slopes) and treatments to mitigate postfire erosion (for example, mulching of hillslopes) constitute the majority 
12 USDA Forest Service RMRS-GTR-205. 2007.

of BAER treatment expenditures, although invasive weed treatments are 

becoming more common.

ERMiT was developed to assist BAER teams in the evaluation of post-fire 

erosion threats and the cost-risk analysis for use of erosion mitigation treat-

ments (Robichaud and others 2006). By incorporating variability in rainfall 

characteristics, burn severity, and soil characteristics into each prediction, 

ERMiT provides probabilistic estimates of single-storm, post-fire hillslope 

erosion. ERMiT uses the Water Erosion Prediction Project (WEPP) technol-

ogy to estimate event erosion rates on burned and recovering forest, range, 

and chaparral lands with and without mitigation treatments. The probability 

of an erosion threat occurring and the probability of treatment success—

two parameters needed for use of the VAR Calculation Tool (steps 1b and 6 

in table 2)—can be determined from ERMiT output. The ERMiT model is 

accessed and used on-line (http://forest.moscowfsl.wsu.edu/FSWEPP) and 

the ERMiT User Manual is available by clicking the documentation icon on 

the ERMiT input screen or as a written document (Robichaud and others 

2007).

Probabilities of post-fire erosion with and without treatments—To use 

ERMiT effectively, the BAER team must determine the event sediment 

yield that the VAR can tolerate without sustained damage. For example, 

if the VAR is a sensitive stream reach with a population of threatened bull 

trout, the BAER team may determine that any additional sediment will cause 

sustained damage and thus, set the tolerable limit of event sediment delivery 

at 0 t ac-1. On the other hand, if the VAR is a less vulnerable stream reach 

with a reasonable flush rate, the BAER team may determine that a hillslope 

event sediment yield of 1 t ac-1 could be tolerated without sustained damage 

to the water quality of the stream. The tolerable event sediment yields will 

likely vary among the identified VAR-erosion threat associations through-

out the burned area.

The VAR Calculation Tool requires an input that answers, “What is the 

likelihood of experiencing the loss with no treatment?” In terms of ER-

MiT output, this is the probability that the tolerable sediment yield limit 

will be exceeded in the first year without any treatment. Similarly, the VAR 

Calculation Tool requires an input for, “What is the likelihood of experienc-

ing loss if treatment occurs.” If the treatment being evaluated is seeding, 

mulching, or erosion barriers (contour-felled logs or straw wattles), ERMiT 

output includes the probability that the tolerable sediment yield limit will 

be exceeded in the first year with the treatment in place, which is the prob-

ability value needed for the VAR Calculation Tool input.

For example, assume that the BAER team has determined that a portion 

of hillslope sediment will be deposited in the stream and, depending on 

the amount, may be detrimental to water quality (VAR). Thus, the BAER 

team set 1 t ac-1 as the tolerable hillslope event sediment yield limit for the 

ERMiT analysis. VAR Calculation Tool input probabilities can be obtained 

two ways: 1) by manipulating the interactive “Mitigation Treatment Com-

parisons” ERMiT output table, the last table in the ERMiT output window 

(fig. 2); or 2) by accessing the “Sediment yield—probability of exceedance 

table” (fig. 3). In the interactive “Mitigation Treatment Comparisons” out-

put table (fig. 2), the number in the “probability that sediment yield will be 

exceeded” box can be changed repeatedly until the first year predicted sedi-

ment yield with no treatment just exceeds the tolerable limit, which in this 

example is 1 t ac-1. Figure 2 shows there is a 50 percent probability that the 
USDA Forest Service RMRS-GTR-205. 2007. 13

Figure 2. An ERMiT output screen showing 

the “Probability that sediment yield will be 

exceeded” that corresponds to just over 1 t ac-1.

Figure 3. Sections of the Sediment 

yield—probability of exceedance 

table (accessed through ERMiT 

output window) showing the 

exceedance probabilities for 1 t ac-1

event sediment yield.
14 USDA Forest Service RMRS-GTR-205. 2007.

event sediment yield will be greater than 1 t ac-1. An alternative way to view 

this probability is to click on the printer icon next to the word “Untreated” 

in the first column of the Mitigation Treatment Comparisons table. This 

accesses the “Sediment yield—probability of exceedance table” (see fig. 

3) that lists the “percent chance that sediment delivery will be exceeded” 

by the sediment yield (t ac-1). Again, the probability that 1 t ac-1 will be exceeded is 50 percent (fig. 3).

If the BAER team decides that a 50 percent chance of threat occurrence 

will require hillslope erosion mitigation treatments, ERMiT output can be 

used to compare treatment effectiveness among the three types of treatments 

as well as between the four application rates of straw mulch. Assuming that 

the BAER team has decided to analyze straw mulch treatment, they can 

use the output from the same ERMiT run to compare the effectiveness of 

the four mulching rates. Both methods described above (repeatedly changing the number in the “probability that sediment yield will be exceeded” 

box [fig. 2] and accessing the “Sediment yield—probability of exceedance” 

table [fig. 3]) can be used to find the probability of exceedance in the first 

year with straw mulch; however, accessing the “Sediment yield—probability of exceedance table” is the quickest way to compare treatments. For 

each mulching rate, the user: 1) clicks on the printer icon in the first column 

of the Mitigation Treatment Comparisons table to access the “Sediment 

yield—probability of exceedance table”; 2) finds 1 t ac-1 sediment yield; 

and 3) reads the probability of exceedance in the first year (fig. 4). With 0.5 

t ac-1 mulch treatment rate, the probability that 1 t ac-1 sediment yield will 

be exceeded is nearly 20 percent, and with 1.0, 1.5, and 2.0 t ac-1 mulch 

treatment rates, the exceedance probabilities are 14, 13, and 12 percent, 

respectively (fig. 4). Given these probabilities, the BAER team will likely 

recommend that mulch be applied at 1 t ac-1 as doubling the treatment rate 

(2 t ac-1) and associated costs to obtain a negligible (2 percent) reduction in 

the probability that the threat occurring will result in a larger IMV with little 

added resource protection.

Treatment Costs

The user must input the costs of recommended treatments separately 

for each VAR-threat association. This allows the VAR Calculation Tool to 

complete a discrete treatment justification for each Map Zone. Sources for 

current treatment costs vary by treatment. Most road and trail treatments 

costs can be provided by the area engineer. The costs of other treatments, 

such as hillslope and channel treatments, can be obtained for BAERCAT 

(Napper 2006), from the suppliers and service contractors who would be 

hired to apply the treatments if funding is approved.

Each Map Zone is reviewed independently and each treatment recommendation within a Map Zone requires a separate justification and decision. 

Some analyses may be very straight forward, especially where a high value 

asset can be protected using an inexpensive, highly effective treatment. For 

example, a water supply intake system serving a federal fish hatchery on 

public lands has intake filters valued at $500,000 that would have to be 

replaced if contaminated by ash and sediment-laden river water. It is expected, given the common autumn rainfall patterns, that the probability of this 

threat occurring is nearly 100 percent. A rainfall and flood warning system 

costing $15,000 will permit managers, with 90 percent chance of success, 
USDA Forest Service RMRS-GTR-205. 2007. 15

Figure 4. The truncated Sediment yield—probability of exceedance table (accessed through ERMiT output window) 

for each of the four mulching rates laid out to show the sediment delivery and probability of exceedance in the 

first year after the fire. The probability of exceeding the 1 t ac-1 tolerable sediment yield in the first post-fire year is 

circled on the table for each of the four mulching rates.

to shut the intake valves, divert the water, and protect the filters. The B/C 

calculation works out as:

B/C = ($500,000 * 0.90)/$15,000 = 30

Clearly this treatment is economically justified.

On the other hand, a historic fur traders’ camp could be washed away if 

a low-probability (10 percent) flood event were to occur. A proposed hydromulching treatment costing $150,000 is expected to decrease the probability of a damaging flood to 5 percent. The IMV calculation yields:

IMV = $150,000/0.05 = $3,000,000

This is a very large IMV for a single, culturally significant but not unique, 

structure and the BAER team would likely not recommend this treatment 

be applied. They may seek a less expensive (albeit, less effective) treatment 

or decide that no treatment is the most justified. However, a B/C ratio less 

than 1 or a high IMV does not necessarily mean treatment should not occur, 

especially if the resource has a high value making any loss unacceptable. 

Under such circumstances, protection of the resource may be justifiable 

even if the cost of the protection is high. The VAR Calculation Tool does 
16 USDA Forest Service RMRS-GTR-205. 2007.

not make this judgment. It is simply a vehicle that describes the economic 

considerations of the BAER treatment decisions.

Using the VAR Calculation Tool

Once the input parameters are available, the VAR Calculation Tool can 

be used to calculate the B/C ratios and/or the IMV of the identified VAR 

and to organize and summarize the justification for recommended treatment 

expenditures.

This section explains how to use the VAR Calculation Tool. To get the 

most out of this section, we recommend you open the tool on the accompanying CD. The VAR Calculation Tool, written as an MS Excel spreadsheet, 

consists of four components: 1) the Welcome page or tab with instructions 

and background information; 2) the VAR Area Map worksheet page (second 

tab); 3) 10 Map Zone worksheets; and 4) a final Summary worksheet where 

the results of Map Zone worksheets are tabulated.

Welcome Page

The Welcome Page provides links to four instruction and support pages 

for the VAR Calculation Tool:

• Introduction—describes the risk-based assessment supported by the VAR 

Calculation Tool and differences in valuation methods used for market 

and non-market VAR.

• Tool Use Preparation—describes the information needed as input to the 

VAR Calculation Tool.

• Structure and Use—outlines the VAR valuation framework and how the 

calculations are done for the different categories of VAR. It also describes 

how the VAR Calculation Tool processes the user inputs on each Map 

Zone page and transfers totals to the summary page.

• Definitions—provides word definitions, particularly economic terms, that 

may not be common knowledge for all users.

The user can navigate to each section by clicking on the rectangular buttons. Return to the Welcome Page view by clicking the “CLEAR ALL” 

button or selecting the Welcome tab on the bottom of each spreadsheet.

Editing the VAR Calculation Tool: This version of the VAR Calculation Tool 

has all pages locked for editing. However, the locks are not password protected and experienced users may release edit protections and make changes. The 

VAR Calculation Tool has two limits—only three VAR items per VAR category 

can be included on each Map Zone worksheet and only 10 Map Zones can 

be summarized. If Map Zone worksheets are added, corresponding changes 

must be made to the Summary sheets and cell reference formulas updated. 

Users who release edit protections and make changes assume responsibility 

for the calculation changes that may result.
USDA Forest Service RMRS-GTR-205. 2007. 17

Gash Creek Fire Example

To illustrate use of the VAR Calculation Tool to assess values-at-risk, 

we provide a scenario based on the 2006 Gash Creek Fire in the Bitterroot 

Valley, Montana. We changed some details and contrived scenarios to present the four types of VAR valuation processes (life and safety; market VAR 

only; non-market VAR only; and mixed market and non-market VAR) as 

well as the use of ERMiT to determine the expected probabilities of erosion 

occurring before and after treatments. We use the example to summarize 

the preparation steps, illustrate data entry into the VAR Calculation Tool, 

and interpret the output from the VAR Calculation Tool. We first describe 

the steps, give examples for each of the four evaluation categories, and then 

summarize all results in a separate section.

Gash Creek Fire Information

The 8,200 acre Gash Creek Fire burned in steep terrain along the east 

face of the Bitterroot Mountains, the west side of the Bitterroot Valley, on 

land primarily under Forest Service jurisdiction. Fires burned across a vegetation gradient from lower elevation dry forests through upper elevation 

cold, moist forest types. Burn severity was predominately low to moderate 

with several concentrated areas of high severity burn.

Preparation for VAR Valuation Within the BAER Process

At the first BAER team meeting, members of the team identified an 

initial list of VAR using current maps, GIS, and local area knowledge. A 

BARC map was available as a first assessment of burn severity and potential sources of post-fire threats. The initial VAR list included: life and safety 

of residents due to increased flooding potential, access to, and safety along, 

road and trail systems; stream crossings throughout the road network, including areas within and downstream of the burned area; critical aquatic 

habitat; and populations of rare and sensitive native plants. The BAER 

team added these identified VAR to the BARC map to focus field assessments. Because the trout habitat was downstream of two watersheds that 

were designated 20 percent (220 ac) high burn severity and 25 percent (280 

ac) moderate burn severity, these slopes were field checked for soil burn 

severity. The BAER team determined that 1) nearly all of the BARC map 

high burn severity areas had high soil burn severity and 2) about half of the 

BARC map moderate burn severity hillslopes had large patches of moderate 

to high soil burn severity with little ground cover and more than 50 percent 

water repellent soils. The remainder of the moderate burn severity area had 

less severely impacted soil (more cover and little to no water repellency). 

Thus, only 150 acres of the BARC map moderate burn severity within these 

watersheds were a runoff-erosion threat to the identified VAR (several road 

culvert stream crossings and the trout habitat).

The BAER team identified four VAR-threat associations and mapped 

them as Map Zones A through D. The team completed descriptions of VAR 

and analyses of associated threats (for example, probabilities of occurrence 

with and without treatment). Mid-way through the BAER assessment process, the team contacted forest engineers and other sources to obtain the 

dollar value of identified market VAR. The team then designed and documented treatment plans with associated costs.
18 USDA Forest Service RMRS-GTR-205. 2007.

VAR Area Map Page

The VAR Area Map page includes the VAR Area Map (prepared earlier 

by the team; fig. 1) and a comment section that together provide an overview of the identified VAR (fig. 5). For the Gash Creek Fire, the team GIS 

specialist worked with resource specialists to compile a VAR Area Map and 

comment worksheet that showed the Map Zones of identified VAR-threat 

associations. They then copied and pasted the VAR Area Map into the designated space on the VAR Area Map page and resized as necessary. This 

can also be done by hand using hard copy maps. Next, the team completed 

the information box in the upper left corner of the VAR Area Map page. For 

each Map Zone, the team briefly summarized VAR-threat associations and 

added clarifying comments or notes as necessary.

Map Zone Worksheets

Ten individual worksheets, labeled Map Zone A through J, are used to independently evaluate the set of values-at-risk, threats, and treatments within 

each Map Zone. Map Zone worksheets are formatted in three sections: 1) 

Values-at-Risk, 2) Treatment Description, and 3) VAR Calculation Results 

(figs. 6 through 9).

To complete the Map Zone Worksheets, the Gash Creek Fire BAER 

Team first entered information into white cells as necessary to describe and 

compute the valuation of the values-at-risk (VAR) within the Map Zone and 

associated each VAR to a Map Link Number (figs. 6 through 9). They listed 

VARs by category (Life and Safety; Non-market VAR Cultural; Non-market VAR Ecological; Market VAR Direct; and Market VAR Loss of Use). 

Figure 5. VAR Area Map worksheet from the VAR Calculation Tool for the Gash Creek example.
USDA Forest Service RMRS-GTR-205. 2007. 19

Note that any one Map Zone may not have all VAR categories. The team 

then wrote a brief description of each VAR in the right column. At the bottom of the VAR section, they entered “Probability of experiencing loss with 

no treatment” (as a decimal—in other words, if there is a 50 percent probability that the threat will occur, the probability is entered as 0.5) and from 

the dropdown menu, selected the source of the probability value entered.

In the Map Zone Treatment Description section, the team briefly described 

the proposed treatments and listed the assigned Map Link Number for each 

treatment. They then entered the estimated treatment cost. For example, in 

Map Zone B (fig. 7), the total estimated cost for installing armored diversion dips and reinforcing culvert inlets was $8,405. Next, they estimated 

the “Probability of experiencing loss if treatment occurs” as a decimal (for 

example, in Map Zone B in fig. 7, the probability was 5 percent, so was 

entered as 0.05). Finally, they used the dropdown menu to select the source 

of the loss probability with treatment information.

Figure 6. Map Zone A worksheet from the VAR Calculation Tool with details for the Gash Creek 

Fire example.
20 USDA Forest Service RMRS-GTR-205. 2007.

There are occasions when a single treatment may provide protection to 

more than one VAR and probabilities of loss with and without treatment will 

differ for each identified threat-VAR association. For example, a hillslope 

erosion mitigation treatment may reduce the probability of damage to a 

stream quality VAR by reducing sedimentation and the same treatment may 

reduce the probability of damage to roads and culverts by reducing runoff and peak flows. The probabilities associated with damaging hillslope 

erosion may be different than the probabilities associated with damaging 

runoff and peak flows (see Map Zone D discussion). The current version 

of the VAR Calculation Tool can only apply a single set of treatment effectiveness probabilities to generate benefit-cost ratio and/or IMV. When 

two or more sets of probabilities can be applied to a treatment, assessment 

teams may have to decide how best to represent the probabilities of the loss 

occurring with and without treatment. This could be done by: 1) combining 

the different probabilities and using “average” or “weighted average” probabilities on the Map Zone worksheet; 2) choosing one set of probabilities 

Figure 7. Map Zone B worksheet from the VAR Calculation Tool with details for the Gash Creek 

Fire example.
USDA Forest Service RMRS-GTR-205. 2007. 21

over the others because one threat is more likely to occur or is the primary 

threat under consideration; and 3) running each VAR-threat-treatment combination on a separate Map Zone worksheet to determine if any one set 

clearly justifies the treatment.

For Map Zone A, life and safety are at risk (fig. 6). Treatment justification is established by providing a reasonable description of how prevailing 

post-fire conditions might lead to death or injury, and neither a benefit-cost 

ratio nor IMV calculation is needed. A treatment plan and cost estimate will 

be completed, and probabilities of loss with and without treatment should 

still be considered as a practical check on the choice and magnitude of proposed treatments.

In the Gash Creek Fire example, an early warning system to detect a 

debris torrent that could damage downstream residences is required to warn 

affected residents of an impending event (this scenario is contrived for this 

illustration). The Glen Lake trail provides the access route to install and 

maintain the required system and additionally, is an important recreational 

route. Following the fire, more than 200 downed stems crossed the trail and 

35 adjacent snags prohibited safe worker access to install the recommended 

BAER treatment. The probabilities of loss with and without treatment were 

based upon the anticipated need for the early warning system. The treatment, 

installing the early warning system, was expected to be completely effective, providing sufficient warning in the event of a land movement event. 

Hazard tree removal is required so that those installing the early warning 

system can safely conduct their work. Probability of loss without treatment 

was estimated at 30 percent, reduced to 0 percent with treatment (fig. 6).

For Map Zone B, where only market VAR are at risk, the treatment justification is determined using a benefit-cost (B/C) ratio (fig. 7). Market VAR 

valuations require determination of the dollar value lost if the associated 

threat materializes (in other words, the cost to repair or replace the VAR if 

it were damaged or lost), the cost of treatment, and the probability that the 

proposed treatment will be successful. The “Benefit” (the expected value of 

the reduction in damage or loss to the VAR defined as market value times 

the reduction in the likelihood of loss with treatment) is compared to the 

“Cost” (the dollar expense of the proposed treatments).

In the Gash Creek Fire BAER assessment, the team identified two major 

culverts and the associated road surfaces along a forest road (fig. 5, Map 

Zone B, points B1 and B2) as VAR threatened by potential flooding and 

debris-laden flows from the high severely burned slopes above the road. 

Field observations verified culvert locations and conditions relative to burn 

severity and terrain. However, given the size of the culverts (60 inches) and 

the well-armored installations, it was determined that only an extreme event 

would potentially damage or destroy these VAR. A forest engineer provided 

cost estimates to repair the culverts and road surfaces as well as the costs 

of installing armored diversion dips to fortify water crossings to minimize 

flood impacts. Consulting with the engineers, the hydrologist estimated a 

10 percent probability of loss without treatment, which would be reduced 

to 5 percent with treatments in place. The potential loss of use of the road 

(another market VAR) was acknowledged but the monetary value was not 

included due to lack of information (fig. 7).

For Map Zone C, the team found only non-market VAR and therefore 

used Implied Minimum Value (IMV) for valuation (fig. 8). No dollar value is 

directly assigned to the non-market VAR; instead an IMV amount is applied 
22 USDA Forest Service RMRS-GTR-205. 2007.

based on the cost of treatment adjusted for the reduction in the probability 

of loss averted by the treatment. The IMV is used to make a judgment as to 

the economic justification of the proposed treatment.

The VAR identified in Map Zone C was a population of rare perennial 

bitterroot plants. Bitterroot is the namesake of the valley, the Montana State 

flower, and culturally significant to native peoples. Once abundant, it is now 

uncommon, particularly on the west side of the valley. Invasive plants, the 

identified threat associated with the VAR, were expected to spread and probably out-compete the bitterroots if the invasive plants were not suppressed 

until the bitterroots were re-established the following spring. Given that 

invasive weeds were already established along a road above the impacted 

area, the BAER team botanist estimated that there was a 50 percent probability that invasive plants would out-compete bitterroots in the first post-fire 

growing season. Seeding with annual grasses, including ground-based hydromulch treatments near the road (at a cost of $29,700) was expected to 

be an effective treatment that would reduce the probability of bitterroot 

plant loss to 5 percent (fig. 8). The IMV resulting from the calculation was 

Figure 8. Map Zone C worksheet from the VAR Calculation Tool with details for the Gash Creek 

Fire example.
USDA Forest Service RMRS-GTR-205. 2007. 23

Figure 9. Map Zone D 

worksheet from the VAR 

Calculation Tool with details 

for the Gash Creek Fire 

example.

$74,250. [Note: In this case, the VAR-threat association was located in an 

area of low burn severity—an area that would typically get little attention 

from a BAER team. The threat to bitterroots, which was not initially expected, was only determined by field observation.]

For Map Zone D, the team identified a combination of market and nonmarket VAR, which is typical of many burned areas (fig. 9). Identified 

VAR included road surfaces and culverts and a population of a sensitive 

aquatic species. The B/C ratio for the market VAR is less than 1.0. Thus, 

treatments are not economically justified without consideration of the IMV 

of the non-market ecological VAR.

Map Zone D consists of two adjacent, elongated watersheds. The larger 

is drained by South Gash Creek and the second is an unnamed tributary of 

Gash Creek. Identified VAR include two actively used forest roads along 

which five culverts are located (four in sequence along South Gash Creek 

and one near the mouth of the unnamed tributary; fig. 5, Map Zone D, points 

D1 to D5). In addition, an identified non-market VAR is an isolated population of westslope cutthroat trout, a species of special concern, located in a 

reach of Gash Creek below the confluence with South Gash Creek (fig. 5, 

Map Zone D, point D6). The culverts and road crowns are at-risk of damage 

from runoff (the associated threat) that would exceed culvert capacity. The 

hydrologist (in consultation with the forest engineer) predicted that there 
24 USDA Forest Service RMRS-GTR-205. 2007.

was a 20 percent chance that a rainfall event would generate enough run-

off to exceed culvert capacity. This runoff event would not only damage 

the roads and culverts, but would likely generate channel-scouring flooding 

with sediment- and debris-laden flows that would impact the downstream 

trout habitat. The hydrologist (in consultation with the fisheries biologist) 

determined that the trout population would be damaged beyond recovery by 

hillslope sediment yields in excess of 1.0 t ac-1 from the contributing area 

above the trout habitat. Hillslope sediment yields of this magnitude could 

destroy the trout population which, due to habitat fragmentation and diver-

sions, may not repopulate the reach.

The ERMiT model predicted a 40 percent occurrence probability that the 

sediment yield from the high soil burn severity hillslopes would exceed 1 t 

ac-1 for a single rain event in the first year after the fire (fig. 10). This sedi

-

ment would be in addition to the sediment that might result from any road 

crossing failures. The same ERMiT run also predicted aerial application of 

straw mulch at 1 t ac-1 rate would reduce the probability of exceeding 1 t ac-1

event sediment yield to 6 percent (fig. 11).

The hillslope straw mulch treatment would likely reduce the runoff peak 

flows and thus reduce the risk of exceeding culvert capacities. The hydrolo-

gist estimated, using professional judgment and runoff predictions from 

hydrological models, that the proposed hillslope treatment would reduce 

the probability of damage to the culverts and the road (market VAR) from 

20 percent to 5 percent. Reduced probability of road and culvert damage 

also reduces the likelihood of additional sediment (beyond the hillslope 

sediment predicted by ERMiT) from entering the trout habitat (non-market 

VAR). However, the current version of the VAR Calculation Tool can only 

apply a single set of treatment effectiveness probabilities to generate a B/C 

ratio and/or IMV. In this scenario, the assessment team has two sets of prob-

abilities related to the aerial straw mulch treatment—the probability that 

hillslope sediment yield will exceed the tolerable limit (40 percent without 

treatment reduced to 6 percent with treatment) and the probability that run-

off will damage culverts and roads (20 percent without treatment reduced 

to 5 percent with treatment). The assessment team used the treatment effectiveness probabilities associated with hillslope sediment yield that were 

generated from ERMiT. The rationale for this example decision included: 1) 

the cost of the aerial straw treatment far exceeds the cost of culvert replace-

ment (a market VAR) and the B/C ratio is much less than 1.0; 2) the aerial 

straw mulch treatment justification will depend on the implied minimum 

value (IMV) of the trout habitat (non-market VAR); 3) exceeding the toler-

able hillslope sediment yield is the more likely threat; and 4) the ERMiT 

values for treatment effectiveness are based on field measurements and the 

treatment effects on runoff were based on several estimated parameter val-

ues being used in runoff equations.

In the final section of each Map Zone Worksheet Page in the VAR Cal-

culation Results section, orange cells will fill automatically and results 

will transfer to the Summary page (fig. 12; Appendix A shows calculation 

methods applied by the VAR Calculation Tool). For the IMV calculation to 

occur, entries must be made in the non-market VAR sections, as well as in 

the treatment cost, probability of experiencing loss with no treatment, and 

probability of experiencing loss if treatment occurs sections. If the map 

zone includes both market and non-market values, the IMV will be calcu-

lated only if the market value B/C ratio is less than one.
USDA Forest Service RMRS-GTR-205. 2007. 25

Figure 11. The ERMiT Sediment 

Yield—probabilities of 

exceedance table (accessed 

from the ERMiT output 

webpage) showing a 6 percent 

occurrence probability for 

single event sediment yield 

that will exceed 1 ton ac-1 from 

a modeled hillslope treated 

with 1 ton ac-1 aerial straw 

mulch.

Figure 10. The ERMiT Sediment 

Yield—probabilities of 

exceedance table (accessed 

from the ERMiT output 

webpage) showing a 

40 percent occurrence 

probability for single event 

sediment yield that will 

exceed 1 ton ac-1 from a 

modeled untreated hillslope.
26 USDA Forest Service RMRS-GTR-205. 2007.

We have provided the user a brief review of literature sources for determining non-market values. At the bottom of the Map Zone Worksheets is 

a button, “View Literature.” The literature is grouped into five categories: 

property, soil productivity, threatened and endangered (T&E) species, water quality, and wildlife. We do not recommend that these sources be used 

to identify a monetary price for non-market values—the IMV approach to 

valuation of non-market VAR is the recommended process. However, the 

literature may provide some valuation comparisons that would be useful to 

some BAER teams. The more similar the described VAR is to the resource 

evaluated in the literature, the more appropriate the comparison. If literature 

exists that provides estimates of the dollar value of a non-market resource 

that is similar to the evaluated BAER resource in terms of physical characteristics and setting, a calculated IMV that is substantially lower than the 

literature estimate provides added justification for the proposed treatment.

Summary Page

Key values from each Map Zone are automatically transferred to the Summary Worksheet (fig. 12). These include: 1) Value

Types assessed (Life & Safety, Non-market, and/or Market values), 

Figure 12. VAR Calculation Tool 

Summary Worksheet for the Gash 

Creek example.
USDA Forest Service RMRS-GTR-205. 2007. 27

2) Total Market Resource Value, 3) Proposed Treatment Costs, 4) Reduction in the Probability of Loss, 5) Expected Benefit of Treatment, 

6) Expected B/C Ratio for Market Resources, and 7) IMV for Non-market 

Resources. The entire Summary Page is “view-only”—no changes to inputs 

are directly made on this page. Instead, informed by review and comparison 

across Map Zones, the user can return to individual Map Zone worksheets as 

necessary to evaluate VAR, probabilities, and treatment components. Where 

data have been entered within a VAR category on the individual Map Zone 

worksheets, the “Value-at-Risk” cell on the Summary page will show “Yes.” 

Transferred values include the sum of market values and treatment costs, 

loss probability values, B/C ratio for market resources, and the IMV calculations for non-market resources. The summary of each Map Zone should be 

reviewed independently to ensure that the cost to protect low value resources 

is not subsidized by high value resources in another Map Zone.

The VAR Calculation Tool Summary Page may be used to summarize and report total proposed treatment costs and estimated outcomes in 

terms of expected market values protected and the IMV associated with 

the non-market values protected for an entire BAER incident. At the top 

of the Summary Worksheet (fig. 12), three values are tallied for the whole 

assessment: 1) Total Treatment Cost; 2) Expected Benefit of Treatment, 

and 3) Implied Minimum Value. For the Gash Creek VAR analysis, treatments totaling $202,748 were proposed to protect market resources with 

expected benefit of treatments totaling $40,011 and an IMV of $428,466 for 

non-market resources (top of fig. 12). The relatively low expected market 

benefits value indicates that the primary justification for the selected treatments is based on highly valued non-market VAR values (values exceed the 

$428,466 calculated IMV). Beyond these general observations, summary 

values alone do not provide economic justification for proposed treatments 

and individual Map Zones need to be evaluated on their own merit.

Summary of Map Zone A—The two value types entered into the Map 

Zone A worksheet transferred automatically to the corresponding summary 

box, Life and Safety and Market Values: Loss of Use (fig. 12). Recall that 

Life and Safety are documented as the primary concern. Therefore, Loss of 

Use, while noted and described, is not quantified. Assuming the threat to 

Life and Safety is mapped and documented, the VAR analysis is complete 

and the proposed treatment at a cost of $7,143 is justified. However attention should be paid to the Reduction on Probability of Loss. In this example, 

treatment is expected to eliminate risk, reducing risk from 30 percent to 0 

percent (fig. 6). Treatments with low threat reduction potential would indicate that proposed treatments do not provide substantial mitigation of the 

threat(s) to life and safety and should be carefully reviewed.

Summary of Map Zone B—The direct market value ($58,883) of the 

road infrastructures threatened by potential flooding and debris-laden flows 

is listed in the Map Zone B block of the Summary worksheet (fig. 12). 

Proposed treatments, at a cost of $8,405, provide a minimal reduction (5 

percent) in the probability of loss. Thus, the expected benefit of treatment is 

reduced to $2,944, which yields a B/C ratio of 0.35, well below the threshold of economic justification of B/C ratio > 1.0. In this case, the probability 

of a destructive event (threat) occurring without treatment was low (10 

percent, fig. 7) and treatment would only modestly mitigate the outcome. 

Consequently, the BAER team would likely determine that the proposed 

treatment for Map Zone B is not economically justified and would not request funding for the treatment.
28 USDA Forest Service RMRS-GTR-205. 2007.

Summary of Map Zone C—Calculations indicate that the treatments proposed at a cost of $29,700 to control the expected spread of noxious weeds 

would reduce the probability of loss by 40 percent (fig. 12). Therefore, the 

IMV of protecting the rare bitterroot plants is $74,250. The BAER team 

must judge if the ecological and cultural value of maintaining the bitterroot 

plants in this area exceeds the IMV of $74,250 and thus is worth the expenditure of $29,700 in public funds to conduct this treatment.

Summary of Map Zone D—Both market and non-market VAR are identified in Map Zone D and the B/C ratio for the market VAR of 0.2 is very 

low (fig. 9). Based on protection of market VAR alone, treatments are not 

economically justified. However, an IMV of $354,215 is calculated for the 

non-market ecological VAR—namely, the aquatic habitat for the protected 

trout species (fig. 9). As with Map Zone C, the BAER team must judge 

if the ecological value of protecting the trout habitat exceeds the IMV of 

$354,215. If so, the investment of $157,500 of public funds to conduct the 

treatment is justified. If not, the treatment should not occur.

Management Implications

Procedures and Planning for Effective VAR Calculation Tool Use

Our survey of BAER personnel revealed that the preparations necessary 

for using the VAR Calculation Tool are, at some level, already implemented 

by most experienced BAER leaders and teams. Two levels of preparation—

one in the pre-fire season and one in the days just prior to convening a 

BAER team—will likely make the use of the VAR Calculation Tool more 

effective. These preparations will improve access to needed data and improve GIS support during the BAER assessment.

In areas where fires requiring BAER assessments are likely to occur, 

commonly required data for post-fire assessments can be compiled and 

made easily accessible prior to the start of the fire season. Non-spatial support data, including local monetary costs of frequently encountered market 

VAR (for example, roads, picnic area facilities, grazing leases) and regularly used treatments (for example, straw mulching, road grading, culvert 

installation), can be cataloged for easy access by potential BAER teams. 

In addition, local GIS data can be obtained and organized. Thus, when a 

fire occurs, the BAER team can have immediate access to a base map and 

resource data libraries, including topographic maps, jurisdictions, roads, 

Digital Elevation Models (DEMs) and derivatives, vegetation layers, hydrologic features, infrastructure and facilities, range and riparian areas, soils 

and geology, wildlife habitat, and special areas. Planning discussions with 

GIS personnel can determine the most commonly used data layers and establish standard BAER templates for common map features.

A second type of preparation also can facilitate BAER assessment with 

the VAR Calculation Tool. Prior to the first meeting of a BAER team, the 

available maps and data layers discussed above can be opened and updated 

with current fire information. This provides a detailed and relevant map 

for use at the initial BAER meeting. With a base map in place and many of 

the relevant VAR already identified and located, the BAER team can more 

quickly assess the current event and plan the assessment process.
USDA Forest Service RMRS-GTR-205. 2007. 29

Support for Post-fire Treatment Decisions and Funding Requests

Using the VAR Calculation Tool as part of the treatment decision-making 

processes requires 1) an understanding of how the tool calculates the B/C 

ratio of market VAR and the IMV of non-market VAR and 2) iterative use of 

the tool to evaluate the economic advantages of various treatment scenarios. 

The VAR Calculation Tool presents a logical and consistent VAR analysis report format that can be included in the BAER funding requests (DOI 

BAER ESR forms and USFS BAER 2500-8 forms) to justify treatment recommendations and facilitate review. We believe that implementing these 

tools will improve the economic justification of recommended treatments, 

provide a common framework for authorization and review of proposed 

treatments, and improve the defensibility of BAER assessments to agencies 

and individuals with financial oversight responsibilities.

References

Calkin, D.E.; Robichaud, P.R.; Jones, J.G. 2006. Pilot study: Improving BAER calculation of 

Values-at-Risk (JFSP 05-01-01-09). Final Report to Joint Fire Sciences Program. [Online]. 

Available: http://www.firescience.gov/projects/05-1-1-09/05-1-1-09_final_report.pdf 

[accessed 5 April 2007].

Finney, M. 2005. The challenge of quantitative risk analysis for wildland fire. Forest Ecology 

Management. 211: 97-108.

Hammond, C.; Hall, D.; Miller, S.; Swetik, P. 1992. Level I Stability Analysis (LISA) 

documentation for version 2.0. General Technical Report INT-285. Ogden, UT: U.S. 

Department of Agriculture, Forest Service, Intermountain Research Station. 190 p.

Napper, Carolyn. 2006. Burned Area Emergency Response Treatments Catalog. Technical 

Report. 0625 1801-SDTDC, Washington, D.C.: U.S. Department of Agriculture, Forest 

Service, National Technology & Development Program, Watershed, Soil, Air Management. 

266 p. [Online]. available: http://www.fs.fed.us/eng/pubs/pdf/BAERCAT/lo_res/06251801L.

pdf [accessed 24 April 2007].

Pigou, A.C. 1938. The economics of welfare. 4th ed. London: Macmillan.

Robichaud, Peter R.; Beyers, Jan L.; Neary, Daniel G. 2000. Evaluating the effectiveness 

of postfire rehabilitation treatments. Gen. Tech. Rep. RMRS-GTR-63, Fort Collins: U.S. 

Department of Agriculture, Forest Service, Rocky Mountain Research Station. 85 p.

Robichaud, P.R.; Elliot, W.J.; Pierson, F.B.; Hall, D.E.; Moffet, C.A. 2006. Erosion Risk 

Management Tool (ERMiT) Ver. 2006.01.18. Moscow, ID: U.S. Department of Agriculture, 

Forest Service, Rocky Mountain Research Station [Online]. Available: http://forest.

moscowfsl.wsu.edu/fswepp/ [accessed 13 March 2007].

Robichaud, Peter R.; Elliot, William J.; Pierson, Fredreick B.; Hall, David E.; Moffet, Corey A.; 

Ashmun, Louise E. 2007. Erosion Risk Management Tool (ERMiT) user manual (version 

2006.01.18). Gen. Tech. Rep. RMRS-GTR-188. Fort Collins, CO: U.S. Department of 

Agriculture, Forest Service, Rocky Mountain Research Station. 24 p.

Rosenberger, R.S.; Loomis, J.B. 2001. Benefit transfer of outdoor recreation use values: a 

technical document supporting the Forest Service Strategic Plan (2000 revision). Gen. Tech. 

Rep. RMRS-GTR-72. Fort Collins, CO: U.S. Department of Agriculture, Forest Service, 

Rocky Mountain Research Station. 59 p.

U.S. Department of Interior. 2004. Chapter 3 - Burned area emergency stabilization and 

rehabilitation. In: Departmental Manual, Public Lands, Part 620. Washington, D.C.: U.S. 

Department of Interior.

USDA Forest Service. 2004. Chapter 2523 - Watershed protection and management. In: Forest 

Service Manual. Washington, D.C: U.S. Department of Agriculture, Forest Service.
30 USDA Forest Service RMRS-GTR-205. 2007.

Venn, T.J.; Calkin, D.E. (2007). Challenges of socio-economically evaluating wildfire 

management in and adjacent to non-industrial private forestland in the western United States. 

In: Harrison, S.R., Bosch, A. and Herbohn, J.L. (eds.), Improving the Triple Bottom Line 

Returns from Small-scale Forestry. Proceedings from IUFRO Working Groups 3.08 Smallscale Forestry and 6.11.02 Forestry and Rural Development in Industrialized Countries, 17 

to 21 June 2007, Ormoc City, the Philippines, The University of Queensland, Brisbane, pp. 

383-396.
USDA Forest Service RMRS-GTR-205. 2007. 31

Appendix A—Calculations Within the VAR 

Calculation Tool

Depending on the user designation of the VAR-threat association being 

evaluated, the VAR Calculation Tool uses one of three calculation processes: 1) B/C ratio for market VAR only, 2) IMV for non-market VAR only, 

and 3) a hybrid of both B/C ratio and IMV for both market and non-market 

VAR.

Market values—Where all the identified VAR in a Map Zone are listed 

as market values, only the B/C ratio will be calculated for that Map Zone. 

The B/C ratio is the loss of market value of the resource if the threat occurs 

times the reduction in likelihood of experiencing the loss divided by treatment cost:

B/C ratio = loss of value ($) × (Prob (loss without treatment) - Prob (losss with treatment))

treatment cost ($)

If, for example, the 1) forest roads and culverts at risk for failure due to 

flooding would require $28,000 to repair; 2) probability that flooding will 

occur without treatment is 90 percent; and 3) probability the flooding will 

occur with hillslope treatments (treatment cost=$16,000) in place is 30 percent, the calculation would be:

B/C ratio = $28,000 × (0.9-0.3) = 1.1

$16,000

Thus, the treatment is economically justified. If the results for a given Map 

Zone are economically unfavorable, in other words the B/C ratio < 1.0, the 

proposed treatments should be reconsidered. If, in spite of the unfavorable 

B/C ratio, the BAER team believes a proposed treatment is needed, there 

may be some market VAR (such as loss of use) or non-market VAR (such 

as ecological values) that were not adequately considered. However, the 

user should be wary of manipulating the inputs to get a favorable B/C ratio 

for market VAR, as it defeats the purpose of using a B/C ratio for treatment 

decisions.

Non-market values—Where all of the identified VAR in a Map Zone are 

listed as non-market VAR, only the IMV will be calculated. IMV is based 

on the concept of break even analysis—what is the minimum value of a 

given resource so that the treatment expenditure is justified (in other words, 

B/C ratio =1.0)? IMV is calculated as the cost of the treatment divided by 

the reduction in the likelihood of experiencing the loss:

IMV = Prob (loss occurring with no treatment) - Prob (loss occurring with treatment)

treatment cost ($) ( (

The IMV approach does not result in a monetary value being assigned to 

the non-market VAR. Reducing the probability of loss to the described VAR 

should be justified at the IMV value. Considered judgment must be applied to determine if protection of a non-market VAR is worth at least the 

IMV and is a wise investment of public funds. If, for example, the 1) likelihood of experiencing loss of a population of bitterroot to invasive species is 
32 USDA Forest Service RMRS-GTR-205. 2007.

estimated to be 80 percent; 2) hand spraying invasive weeds and monitoring 

in the area will cost $5,000; and 3) probability of experiencing loss of the 

bitterroot population with the spray treatment is 50 percent, then the IMV 

of the bitterroot population is calculated as:

IMV = $5,000 = $16,667 0.8 - 0.5

The decision of whether the treatment is justified is based on a determination of whether the presence of bitterroots in this Map Zone is worth at 

least $16,667. If so, the treatment is justified; if not, this treatment should 

not occur. A qualitative description of the potential resource damage or 

loss without treatment is needed to justify the BAER treatment funding request. Funding approval will depend on the reviewers’ corroboration of the 

BAER team’s judgment that the VAR valuation is equal to or greater than 

the IMV.

Both market and non-market values—When treatments are proposed to 

reduce the likelihood of losses to both market and non-market VAR within a 

given Map Zone, a hybrid approach is used. First, the B/C ratio is determined 

by examining the market VAR value change, reduction in the likelihood of 

loss, and the treatment costs without consideration of the non-market VAR. 

If the B/C ratio is greater than 1.0, the proposed treatments are justified 

and the non-market VAR need not be evaluated. If, however, the B/C ratio 

is less than 1.0, the value required to justify proposed treatments is then 

assigned to non-market VAR and interpreted through the calculated IMV. 

Determining if the treatments are economically justified is then the same as 

for non-market VAR alone. If, for example, water quality of a stream and a 

forest road with four undersized culverts are threatened by potentially large 

runoff and erosion events (due to large contiguous patches of high soil burn 

severity in the watershed), the VAR valuation process would first calculate 

the B/C ratios for the market VAR—road surface, culverts, and loss of road 

use for forest management and recreation. Assuming that the assessment of 

market VAR results in a B/C ratio of 0.6, the difference in the total treatment costs ($250,000) and the expected benefits of the treatments to the 

market VAR ($150,000) is assigned as the treatment costs to the non-market 

VAR ($250,000 - $150,000 = $100,000—the proportion of treatment costs 

assigned to the non-market VAR in this map zone). Assuming that the proposed treatments will reduce the probability of damaging sedimentation 

by 40 percent, the IMV of the non-market VAR (stream water quality and 

habitat suitability) is calculated as $100,000/0.4 = $250,000. The decision 

of whether the treatments are justified is based a determination of whether 

protection of the water quality of the stream reach in this Map Zone is worth 

at least $250,000 to the public.
Publishing Services Staff

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The Rocky Mountain Research Station develops scientific 

information and technology to improve management, protection, and use of the forests and rangelands. Research is 

designed to meet the needs of the National Forest managers, Federal and State agencies, public and private organizations, academic institutions, industry, and individuals.

Studies accelerate solutions to problems involving ecosystems, range, forests, water, recreation, fire, resource inventory, land reclamation, community sustainability, forest 

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