Unblock Mass Timber by Incentivizing Up-to-date Building Codes
Mass timber can help solve the housing shortage, yet the building material is not widely adopted because old building codes treat it like traditional lumber. The 2021 International Building Code (IBC) addressed this issue, significantly updating mass timber allowances such as increasing height limits. But mass timber use is still broadly limited because state and local building codes usually don’t update automatically. The U.S. Department of Agriculture (USDA) could speed the adoption of mass timber through grants that incentivize state and local governments to adopt the latest IBC codes.
Mass timber can help with housing abundance and the climate transition.
Compared to concrete and steel, mass timber buildings are faster to build (therefore often cheaper), just as safe in fires, and create fewer CO2 emissions. Single- and multi-family housing using mass timber components could help with the 7.3 million gap of affordable homes.
Broader adoption could meaningfully increase productivity and thereby reduce construction costs. Constructing the superstructure for a 25-story mass timber building in Milwaukee completed in 2022 took about half as long compared to concrete. Developers have reported cost savings of up to 35% through lower time and labor costs. Mass timber isn’t only for small projects: Walmart is building a new 2.4-million-square-foot office campus from mass timber.
Most states are on older building codes that inhibit use of mass timber.
Use of mass timber is growing. But building codes, often slow to catch up with the latest research, have limited the impact so far. Only in 2021 did amendments to the IBC enable the construction of mass timber buildings taller than six stories Building taller increases the cost savings from building faster.
State and local government adoption of building codes lags further. By 2023, only 20 states had adopted IBC 2021. Eventually builders might lobby governments to catch up, but for now there’s little reason for many builders to consider mass timber when it’s so restricted.
USDA could incentivize the adoption of the latest IBC.
There should be a federal grantmaking program that implicitly requires the latest IBC codes to participate, incentivizing state and local government adoption.
The USDA could house this program due to policy interest in both the timber industry (Forest Service, FS) and housing (Rural Development, RD).
In fact, USDA is already making grants towards mass-timber housing, just not at a scale that directly incentivizes code changes. Since 2015, the Wood Innovations Grant Program has invested more than $93 million in projects that support the wood products economy, including multifamily buildings. USDA also recently partnered with the Softwood Lumber Board to competitively award more than $4 million to 11 mass timber projects. Most of these buildings are in states or cities that have adopted IBC 2021. For example, one winner is a 12-story multifamily building in Denver, which would be impossible without IBC 2021.
To unlock the adoption of innovative mass timber construction, Congress should take the following steps:
- Appropriate additional discretionary budget to USDA with direction to invest in mass timber innovation. For example, increasing the Wood Innovations Grant Program by 10 times the FY 2023 amount would be ~$430 million, less than 1.5% of USDA’s discretionary budget.
USDA should then take the following steps:
- Allocate those funds to the FS Wood Innovations Grant Program or a similar program within RD.
- Prioritize grants to multi- and single- family housing projects.
- Write funding priority that necessitates the latest IBC mass timber amendments. For example, priority to building designs over eight stories would only be possible in locations where IBC 2021 is in effect (or comparable amendments).
That funding opportunity incentivizes state and local governments to adopt mass timber amendments.
It’s uncertain how much funding would create a strong incentive. But even if most projects were awarded in states already using IBC 2021, there may still be positive downstream impacts from meaningful investment in the industry. While there are far fewer mass timber projects relative to total construction, there are far more than a grant program of this scale could directly support, so there shouldn’t be a shortage of projects. The goal is not to directly build millions of homes but to bring state building codes up-to-date. Updating building codes is necessary but not sufficient for construction at scale.
A simple mechanism to unlock the potential of mass timber.
A federal USDA grant program incentivizing adoption of the latest IBC amendments related to mass timber requires no new funding mechanisms and no new legislation. The structure is already available with the FS Wood Innovations Grant Program as a clear example. That program had ~$43 million in grants for FY 2023; perhaps an order of magnitude more funding would move more states to the updated IBC. This program would not drive mass timber adoption at scale on its own, but updating building codes is a necessary first step. Because mass timber is faster to build with and results in fewer emissions, it is a crucial building material that could contribute to both housing abundance and the climate transition.
This idea of merit originated from our Housing Ideas Challenge, in partnership with Learning Collider, National Zoning Atlas, and Cornell’s Legal Constructs Lab. Find additional ideas to address the housing shortage here.