As the only surface water source for Beijing, the Miyun Reservoir and its catchment (MRC) are a focus for concern about the degradation of ecosystem services (ES) unless appropriate payments for ecosystem services (PES) are in place. This study used the contingent valuation method (CVM) to estimate the costs of two new PES programs, for agriculture and forestry, and to further calculate the economic value of ES in the MRC from the perspective of local rural households’ willingness to accept (WTA). The results of Logit model including WTA and the variables of household and village indicate that the local socio-economic context has complex effects on the WTA of rural households. In particular, the bid amount, location and proportion of off-farm employment would have significant positive effects on the local WTA. In contrast, the insignificance of the PES participation variable suggests that previous PES program experiences may negatively impact subsequent program participation. The mean WTA payments for agriculture and forestry PES programs were estimated as 8531 and 8187 yuan/ha/year, respectively. These results consistently explain the differentiated opportunity costs on both farmland and forestry land. Meanwhile, the differentiated WTA values in Beijing vs. the surrounding Hebei Province follow the interest differences and development gaps between jurisdictions. Finally, the total economic value of ES in the MRC area was estimated at 11.1 billion yuan/year). The rational economic value of ES for the restoration priority areas reaches 515.2 million yuan/year. For the existing budget gap (299 million yuan/year), the study proposed that decision makers increase the water tariff by 0.08 yuan to raise the funds needed. The study also concluded that these results are not only financially and politically feasible but also cost-effective. This study has policy implications for improving the implementation efficiency and providing quantified supports for PES programs in megacity source water area.

As the local strategic surface water source for Beijing City, the Miyun Reservoir catchment is suffering from the challenges of forest landscape degradation (FLD) under various natural and anthropogenic disturbances. This study developed a cause–effect Bayesian network model, consisting of three tiers of nodes, site indicators, external disturbance, and the outcome of FLD, to perform a regional ecological risk assessment to better understand the FLD risks (1998–2013) in the catchment. The effects of the Beijing–Tianjin sandstorm source control (BTSSC) Phase I program, a typical forest landscape restoration program, on the FLD were further examined. Overall, the higher level of either current occurrence or risk probability for FLD suggests the urgency of the following restoration efforts. The dominance of soil erosion for FLD indicates that soil erosion control should be a priority in the following Phase II program. Meanwhile, the uneven spatial distribution of high‐risk areas suggests that the following efforts should be focused within the upstream Hebei Province. In addition, based on the comparison of site indicators between different risk areas, the study concluded that community livelihood activities and land degradation due to climate change have been the other two dominant driving forces contributing to FLD. Furthermore, the study found that the forest landscape has not been restored into the best state by the BTSSC program due to the multiple and complex challenges. Thus, the technical concept of nature‐based solutions, including close‐to‐nature forest management technology and a comprehensive community‐involvement governance model, was proposed for the following Phase II program.