Full Transcript for Mass Timber Schools

off to create revenue. That in and of itself is good for managing the budget side of the schools. It's a nice way to continually have funds available for the schools. think about this. We have those. Now, those logs that are sold typically go to state manufacturers, so sawmills, like Vaagen Brothers, for instance, will buy a trust sale or a log sort from one of those trust lands that the DNR runs. The money that goes into that goes to pay for schools, but it doesn't stop there. All of the jobs in the forest on the way from the forest to the mill and in the mill are all within the state of Washington. People are paying taxes. 00:04:47.779 --> 00:09:47.671 There's a lot of other economic activity created there. Now enter in mass timber. So if we were to buy that lumber from Vaagen Brothers, bring it to our facility and put it into CLT, we have that many more manufacturing jobs and value added And now we can make those products, and we can design them together to make these schools, and we do it in a very efficient way. We use our 3D modeling and all those things to make a kit of parts that go together rapidly, and they build fast, effective, and beautiful schools. So why wouldn't we then want this economic engine that comes from the state trust lands that we have, that we manage, creating more tax dollars that can go to the state, that can go to build these schools with mass timber? It sounds great. There's also some very specific language in the statute about how schools are to be built with local contractors and a series of other things to try to keep the jobs local, which I applaud, but there's a gap and that gap is in the material supply and mass timber is considered the material supply. So, We've talked about the tariffs and duties of lumber coming into the U.S., but no duties or tariffs on mass timber coming to the U.S. So get this, many of the schools that have been designed to be built with mass timber, and they have been built with mass timber, are coming from cross-laminated timber and glulam produced in either Canada or produced in the U.S., but with lumber generated in Canada. So we haven't connected these dots at all. And unfortunately, even though we're supposed to have local contractors, it comes down to a best price bid selection. So we put in our bid to bid on the work for these schools, and the Canadians put their bid in. And they look at it, one's less than the other, Canadian product gets selected. That leaves a pretty rough taste in my mouth and those that know this whole system. We should have local supply being at least preferred or being able to negotiate if we weren't the lowest or best bid to begin with. We have a higher quality product. I can say that without a doubt because of the material we use and the way we do it. and we provide better service. There's nobody better than Vaagen Timbers about managing the logistics and managing the sequencing of a mass timber job. So there's a lot of value proposition that we offer that our competition attempts to or doesn't. Some don't, some do. But the that we offer to produce these schools at a very high level, to produce the materials and then produce the constructability, the connection systems, the sequencing of the erection, all those things. And we feel we can deliver a very competitive, if not more cost effective structure overall, but we're treated as material supply. Like if we were delivering concrete, or we were delivering sprinkler piping, or we were delivering electrical wire. And because a lot of that material is sourced elsewhere, that isn't looked at as being locally sourced. So this is a problem that I see that we have, and we miss out on all the other tax-generated revenue from the manufacturing within the state, the usage of the material within the state, the fact that we could be leveraging those trust lands and pushing it through into those buildings, we're just missing it. And so I want to call attention to this. I think our state legislature needs to take a look at it. You know, I'm on the state manufacturing committee that's reporting to the Department of Commerce. And I brought this up and I just don't think that it's resonating or connecting with people. And I think that in a soft construction market like we have, we should be able to lean on our state school projects and other municipal projects as a continual source of work But when we're out-competed by another product that doesn't have the tariff or duty that it should have, regardless of what you think of the tariffs, there's a lumber duty already in place for product that comes from Canada to the US. And if it's manufactured in Canada, that doesn't have that duty. So that should at least transfer over. 00:09:47.691 --> 00:10:28.009 That's not even talking about protecting the manufacturing. Washington schools should be made out of Washington wood. And I encourage each state and each region out there, look at mass timber for your schools. It's beautiful, it's fast, it works great for schools. And your school districts, your teachers, the children are all gonna love it. There's a lot of schools out there that are built with other materials that are good, but nothing really resonates like a wood building. And it doesn't have to all be wood, but you can have your exposed ceilings, you can have a number of other attributes of the wood that you can show off. 00:10:28.509 --> 00:11:46.398 And it does have, there are studies, as I said earlier, that have a calming effect on the kids by being surrounded by natural elements like wood. So I encourage you to do that. And then when you do that, think about the sourcing and partnering with a group in the beginning that actually thinks about how to add value through the entire construction process rather than just supplying materials. Because we're using CNC technology to cut these pieces precision, we're putting the hardware on there, we're giving a shop drawing with each specific part, and we're

reconnecting it. It's just like a set of Legos with a set of plans. We're also, we procure all the hardware, we apply it, we apply a UV protectant and a sealant on the product so it stays nice and pristine, is easily wipeable or washable if something were to happen to it. We also work with groups like VaporShield to apply a breathable membrane on the side that may be exposed to rain while the construction process is going on. So now you have wood that's performing great, it's protected. but we deliver all of that in sequence. And a lot of people think about that. 00:11:46.418 --> 00:13:31.392 It's not just like supplying lumber to a job site or supplying other building materials to the job site and then the construction crew putting it together. This is a very well-planned, sequenced event, putting these buildings together. And they turn out incredibly well. If you haven't been in a mass timber building and you're thinking about it, you're a construction professional, you're somebody that has influence in this area, go see a mass timber building. Go see how it looks. It will touch you. It will let you think about ways to make these buildings mass timber because there's a connection that you have with the building when it's made of wood. It's just different. And when it's done right, it's a beautiful thing. I'm very biased. I don't think that's news. But you know, I hear it all the time, people build buildings with us, and they get those buildings done, and they are elated. And there's much more value than just the fact that it's wood and it lasts for a long, long time. So yeah, excited about opportunity to be in more schools, but I want us to think about sourcing, and I want us to think about how can we make a level playing field with raw material, with trade, with everything that's out there, and think about all the other values that are there. I want a fair competitive landscape that everyone can do well at, but we need to develop this mass timber infrastructure in the US in a big way because the market's growing. If you look out there, there's data centers that are being built with mass timber, there's fulfillment centers and distribution centers and industrial buildings. 00:13:31.792 --> 00:13:48.552 It's a good thing because we're taking the carbon that those trees are storing and we're putting it in those buildings for the life of those buildings. they can be reused if the building were to change or have to be redeveloped into something else, that material is still good construction material. 00:13:48.592 --> 00:14:21.445 So we can talk about that in a later episode. Really appreciate you taking the time to listen to this episode and following along, reach out if you get a chance and feel free to ask questions or give us ideas for Thanks for watching. Thanks so much for tuning into this episode. We sure do appreciate it. If you haven't done so already, make sure you're subscribed to the show wherever you consume podcasts. This way you'll get updates as new episodes become available. And if you feel so inclined, please leave us a review and tell a