If you figure that a running yard of fabric is actually 40" x 36" (assuming a 40" width) then you would multiply 1.111 x running yards to get the square yards. However, square yards is not a very useful measurement, since yardage for a pattern is always given in running yards (sometimes stating whether 44/45 width is assumed), and anyway 1.111 is pretty close to 1. And depending on what size blocks you're cutting, you can't count on using up all 40 inches of the width. If your patches are large, you need to take that into account when you figure yardage. For instance, if your patch size is 9", you can only count on getting 4 patches in a 9"x44" strip of fabric, leaving a piece that's 9"x8".
BTW, a pet peeve of mine, I shouldn't really mention, but I'm feeling evil today - it's "selvage", or "selvedge" (British version), not "salvage". I've heard even quilt store owners call it salvage, but that's the act of saving a ship or its cargo, or a term referring to the remaining value of a car after it's been wrecked. Selvage means "self edge", the self-finished edges of fabric. Ok, off my soap box. Hope I didn't offend anyone.