A large part of what keeps our Colorado forests and trees healthy is the organic matter within the first layers of the soil. Allowing wood chips to return back to the forest floor or around the trees as mulch is a process that adds the nutrients back to the soil. This keeps the nutrients in the system instead of hauling them off-site.
Ecosystems like cycles. Wood-chipping back to the forest floor helps connect one of the cycles that the forest needs. Chips are good for water retention, erosion prevention, lessens soil compaction, and creates an aesthetically pleasing landscape.