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The full value of benefits rendered from healthy watersheds is difficult to estimate, and ecosystem service (ES) valuation sometimes necessarily occurs in the form of costs incurred or avoided. Along these lines, social-ecological systems including Payment for Watershed Services (PWS) are increasing in frequency and can help land management entities to bridge budget shortfalls for funding needed watershed restoration forestry treatments. The Flagstaff Watershed Protection Project (FWPP) is a bond-financed wildfire risk mitigation partnership and PWS program in Northern Arizona, the only forest management project that utilizes a municipal bond as the financial mechanism in conjunction with a partnership governance structure to invest in federal land management. The purpose of this research was to describe this new governance structure to understand the potential benefits to communities and federal land management agencies for protecting watershed services. Data were derived from document review and key informant interviews (n = 9). FWPP institutional design and governance structures were tailored to maximize community strengths and encompassed several advantages over traditional federal land management models; these advantages include increased collaboration and institutional support, financial security, and public approval. The FWPP represents an innovative PWS system that can help showcase unique community and federal forest management partnerships that benefit watershed health in western US communities

Ecosystem Service Valuation through Wildfire Risk Mitigation: Design, Governance, and Outcomes of the Flagstaff Watershed Protection Project (FWPP)