The bill creates a new procurement preference law by adding a section to chapter 39.04 RCW and a separate section addressing conflicts with federal funding requirements. For public works contracts that either receive more than $500,000 of state funds in the capital budget or are financed through a "financing contract" (as defined in RCW 39.94.020) and where state funds pay more than one-half of the project cost, lumber used or supplied for the contract or any subcontract must be procured in descending order of priority from Washington, then Oregon, then elsewhere in the United States, unless a waiver applies. The bill establishes a procedural waiver process and delegates waiver authority: for the state the director of the Office of Financial Management, for school districts the superintendent, and for municipalities the executive head. A waiver may be granted only if one of three determinations is made: (1) the requirement is inconsistent with the public interest; (2) lumber is not available in the priority locations in sufficient or reasonably available quantities and of satisfactory quality; or (3) meeting the requirement would increase the cost of milled wood products by 10 percent. Agencies must provide public notice and at least 30 days for electronic public comment before issuing a waiver and must publish a detailed justification addressing public comments on their website before the waiver takes effect. The new procurement rule applies to projects advertised for bids after the section’s effective date. The act defines "municipality" for this section to include cities, counties, towns, port districts, districts, or other public agencies authorized to require public work. It also provides that any part of the act that conflicts with federal requirements tied to receipt of federal funds is inoperative to the extent of the conflict, and rules adopted under the act must comply with federal requirements necessary for receipt of federal funds. The text references the definition of "financing contract" in RCW 39.94.020 but does not include that definition. Several details are not provided in the extracted text: the bill’s effective date; statutory definitions for "lumber," "milled wood products," "public interest," and "reasonably available quantities and of satisfactory quality"; and any enforcement, compliance monitoring, or penalty provisions.

If enacted, covered public works projects that get more than $500,000 in state capital budget money (or are financed through the referenced financing contract) and where state funds pay more than half the cost will need to buy lumber first from Washington, then Oregon, then elsewhere in the United States. That will likely shift more buying toward local lumber suppliers in Washington and Oregon, could reduce options for contractors, and may raise or stabilize prices if local supply is limited; school districts, cities, counties, ports and other public agencies will have to follow this priority when procuring lumber for those projects and may face higher material costs or limited sourcing choices as a result. Those agencies also must run a public waiver process—posting a 30-day public comment notice online, accepting electronic comments, and publishing a written justification that responds to comments—before a waiver allowing nonpriority lumber can take effect, which adds administrative work and could delay procurement. Waivers can be granted if the purchase rule would conflict with the public interest, required lumber isn’t reasonably available in sufficient quantity or quality in the priority areas, or complying would increase milled wood product costs by 10 percent; federal funding requirements override this law where there’s a conflict. Important details are missing here—such as the bill’s effective date, the exact definition of a “financing contract,” what counts as “lumber” or “reasonably available,” and how compliance or penalties would be enforced—so the real-world reach and timing are uncertain.