Vermont Legislature SmartTranscripts:

[Speaker 0]: To our joint hearing between the senate economic development housing and general affairs committee and house commerce. It is great to have you all here. I'm Alison Clarkson. I chair senate economic development. And to my right

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: I'm Mike Mark Odd, state representative from Coventry, and I chair House Commerce and Economic Development.

[Speaker 0]: And we'll all introduce ourselves, but we just wanna know how welcome you are. You are our partners in economic development, and we depend on you. We're proud of you. We are your cheerleaders in the state house and advocates for all things, from all tax credits, any incentive, any piece of business that we can help enable, we try to do so even in a very tight and lean year. So it is great to have you. We look forward to listening to you and hearing both your triumphs and your challenges and needs, and we'll try as best we can to respond from. So anything else? Is that good? Why don't we start with Michael? Why don't you introduce our committees?

[Dave LaForte (Co-owner, Built by Newport)]: Michael Booten, Berry City.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: Herb Olson, Bristol Lincoln Moncton, Starks on the concert.

[Dave LaForte (Co-owner, Built by Newport)]: I'm Tom Chittenden. I represent the Southeast Area of Chittenden County.

[Rep. Jonathan Cooper (Bennington District; House member)]: Morning. I'm Jonathan Cooper, Southwestern Vermont, Bennington District. We live in panel, presented proudly by Southwest Tech, our CTE center. Good morning, Senator David Weeks representing Rutland County.

[Speaker 0]: Alison Clarkson representing the Windsor District.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: Hi, Marco representing Orleans Memorial.

[Speaker 0]: Hi, Edie Granting representing Jericho and Underhill serving on House Commerce.

[Rep. Kirk White (Bethel/Rochester/Stockbridge/Hancock; House Commerce)]: Kirk White representing Bethel Rochester, Stockbridge, Hancock and also House Commerce.

[Amy Spear (Vermont Chamber of Commerce)]: Emily Harris Duncan, House Commerce, Wilmington, Whitingham and Halifax.

[Kevin Moyer (Owner, Vermont Frames)]: I'm Tony Micklis. I represent the Route 7 Corridor of Milton and a little bit of Georgia. I'm on House Commerce. Representative Dave Bosch from Clarendon representing Wallingford Clarendon, West Rutland and the larger portion of Rutland Town on House.

[Speaker 0]: Great, and with that, Amy, why don't you come and join us and kick off. You're our host of the day. Come and kick us off.

[Amy Spear (Vermont Chamber of Commerce)]: Good morning, for the record, my name is Amy Speer. I'm the president of the Vermont Chamber of Commerce. I first want to thank Senator Clarkson and Representative Markot for hosting this joint hearing today. Manufacturing is so important to our economy and the work that you're doing in your committees supports the industry. Also want to acknowledge Representative Cooper, who is the champion of Manufacturing Day in the State House. So lots of champions in the room. Appreciate all of your time today. I'm going to be brief in my remarks because the focus is really on the industry, but I thought it would be helpful to set the stage just slightly on some data about manufacturing in Vermont. So the data that you're about to see comes from the Vermont Futures Project and federal sources. It reflects both where we are today and what's significant about our future trajectory because ultimately economic outcomes are often the result of policy choices, just as Senator Clarkson alluded to a moment ago. So first, when we look at the economic composition, if you look at Vermont's economy today, manufacturing remains a strong contributor as shown on this slide. It represents over 3,300,000,000.0 in GDP and roughly 7% of our economy. But here's the key point here. Ten years ago, manufacturing ranged closer to the top of that list. Today, we're seeing faster growth in sectors like government and healthcare. And those sectors are important for the Vermont economy, but they do function very differently. They are largely funded by dollars that are already in our system. So when we look at our ten year in review, manufacturing is different. It brings in new money into Vermont. It exports, it competes globally, it grows the economic pie rather than redistributing it. So to be clear, manufacturing has grown, but it has not grown at the same pace as other sectors, which means over time, it becomes a smaller share of our economy. And that matters because the sectors that scale and export are the ones that drive long term economic growth for our state. When we look to our workforce, this is manufacturing employment by month, now shifting from economic output to employment, because this is where the signal becomes even more urgent when we're looking at this chart. Manufacturing employment in Vermont has declined 11.3% since 2020. And Vermont is one of only a small number of states to see this, and we're projected to see continued decline in manufacturing employment over the next decade. What's more, we've already reached that projected decline that was the ten year projection right now. I think what's important here that I want to focus on is when we talk about investing in automation in the state of Vermont, it's saving jobs, it's saving our workforce, it's making manufacturing more resilient. So if you're looking at maybe high workplace incidences where there might be automation installed, or it allows expansion and contraction without expansion and contraction of your workforce. So manufacturing in our state, I want to make it clear here, is it's not just another sector. It's a sustainable source of revenue, wages, and opportunity for Vermont. Something important that I want to flag here is research and development. There was a research and development tax credit expansion that moved in H933. And I think I want to emphasize here and just take a little bit of pause because now this is not a story of decline without opportunity. Where there's opportunity for our state is in research and development in particular. It's a story of under realized potential because when we look at wage growth, the strongest wages are in industries that scale, export, and bring in new dollars to the economy. And importantly, the desire to do that and to expand is already here. This shows that Vermont is investing in R and D, but we're not yet leading. It tells us that the foundation exists, the demand exists, and the opportunity exists. Now it's really all about alignment. R and D helps companies to scale. A lot of R and D expenditures are in people. It's the people that are developing the products. So supporting research and development is a really important thing for the manufacturing industry. Now, I do want to take a moment just to talk a little bit about competitiveness before I wrap this up, because growth does not happen in a vacuum. It happens within a policy environment. And right now, Vermont ranks among the highest states in the country for taxes per capita. At the same time, through our business climate survey, we consistently hear concerns about cost pressures, workforce availability, housing, and regulatory predictability, which is why the work of both of these committees is so important to this industry, because you're looking for ways to support the industry and what you do can really impact all four of those pressures that people are facing. Just to wrap things up, we wanna grow manufacturing in Vermont, but we also must be competitive. So what this means for the industry and what you'll hear today, it's lowering barriers to growth. It's creating predictability and supporting the industries that expand our economy. So I'll close with just this remark, then we'll move on to the next person here today. Manufacturing is not just a part of Vermont's economy. It's one of our most important economic engines as a state. The data is clear. We have opportunity as a state, reverse our current trends, to scale what's working in our state, and to build an economy that is growing, not just circulating. So thank you, committees, for your time and your leadership today. Appreciate

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: it. Thank you, Randy. Next, we'll be hearing from Amy. Morning. Good morning.

[Ben Bristow (Operations Manager, Nolato Vermont)]: Thank you for having us. My name is Ben Bristow. I'm the operations manager at Nilotto down in Royalton in Bethel, Vermont.

[Speaker 0]: I'm Amy Larkin. I'm the human resources manager.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: We had the pleasure of touring here.

[Dave LaForte (Co-owner, Built by Newport)]: That was a great time.

[Speaker 0]: Yeah. It was that was great.

[Ben Bristow (Operations Manager, Nolato Vermont)]: We had a very good turnout for a natural manufacturing day as well. I think we had well over 100 people come through and it was right. Everyone was very surprised and happy to see what we're doing in the local area. So yeah, we got some slides. I'll give, keep it brief on what we do just to kind of give some background of what we're making in Vermont and then get into you know some of the things that are great and some of the things that we're struggling with and then perhaps take any questions. So, yeah, Milano, biggest thing, Milano is formerly GW Plastics. I'll get into more details there, but people might be more familiar with that name than they are with Milano, Vermont. But we have been here about seventy years in the state of Vermont. So quickly on Mulatto, we are a Swedish publicly traded company focusing in the polymer industries, mainly making things in both industrial and medical. You'll see highlighted here we are 100%, almost 100% exclusively medical at Nolando, Vermont. Nolando overall was founded in 1938. We have over 5,700 employees worldwide, three continents and 12 countries. Specifically, Nolato, Vermont, as I said, were founded in 1955 as GW Plastics. We are under the same private ownership from 1983 until 2020, and we are acquired by Nolato. The best thing about that acquisition is I can say Nolato is a manufacturer. They were not bottling us up to buy us and sell us off. They made products that we do. We simply expanded their North American fleet. You know, they didn't want you know, package us up. They wanted someone to do more North American business in the same industry, which is very good. Know, it's a good, it's the good acquisition to have. As I said, we specialize in injection molding of both plastic and silicone serving the medical industry. We're part of Nolato's Medical Solutions Group. And Nolato, we're what's known as a custom manufacturer and molder, meaning we don't own the products we sell, we're being hired by the OEMs, the big medical companies to make a piece for them that they're going to put in their device. And then we focus on high volume long life medical products, and when I say long life, it doesn't mean they're reusing the syringe, it's that that device is not going to be redesigned every year. You know, it's not an iPhone case that changes every year, it's when they design this, it goes to the FDA. These products we're going to manufacture for ten, twenty, I think some of the molds we have are 40 years old. Know, parts stay in the industry. And for a little bit of scale, in 2025, we produced 1,200,000,000 pieces. So 1,200,000,000 parts came out of our facility in 2025, or facilities. Some numbers, so we do we have 20 fourseven production supported by four twelve hour shifts, three fifty employees right now, with roles ranging anywhere from entry level operators up to senior level engineers and leadership. Two production facilities in Bethel and Royalton, only about five miles from each other, 110 production sales, and in 2025 we did about $92,500,000 in revenue, and about $20,000,000 is paid out in wages for people in Vermont. Quickly, is kind of where Nolato fits in the medical device industry. If you look at it as a stream where the OEM designs the product, we're pretty much the next step where they come to us and say now we need these little pieces of plastic, silicone, whatever it is to go into our device. That's where Nolato Vermont fits, then it's sent off to someone else who makes the final assembly. Nolato does do assemblies, but right now we're not doing them in Vermont, but not saying that's not something we wouldn't explore in the future. Very brief injection molding is simply we're taking silicone on that upper left corner there, which is very similar to what you buy in the store to put around your windows or your tub. We're injecting it at high pressure heating it and it becomes a solid rubber product. Or plastic we're melting it, doing the same thing, injecting it at high pressure to make a product as well. So that's just very quickly what is injection molding. After this, I think it's always interesting to pick some devices that people might know and see that we do make right here in Vermont. So this first one here is an insulin pump for diabetes, you'll see it there in front of that phone, the parts on the left side are all made right in Vermont, and then shipped to the final manufacturer to make that device. This is another one where we make parts and that's actually final assembled in our Arizona facility, but this is obviously a nebulizer for mainly for asthma, but oral medications. This one hopefully you don't see it that much, but these are surgery devices we make a lot of the handles that go to the minimally invasive surgery robotics type stuff that a lot of surgeries are done with today. So these are two shot, pad printed, high technology molding. This here is another one you probably wouldn't see, but if you have a dog or a cat, it's probably been used. So on the left side are all the pieces we make. This goes to a company in Maine. It's great because it's a short commute, we use reusable packaging back and forth, but this is a diagnostic test for dogs, cats, veterinarians, and we're at, I must say college for a career day, and it didn't even click that all the veterinarian schools were there, and they said why do you guys have those on your table? And we said oh well we make them right here, so it was fun connection in Vermont to realize you know that we make those here. This one, Soothie Pacifier, I do complain this is the one finished part we make. It's pure silicone, so this is a pacifier for babies. Generally you see these a lot in hospitals, but I'll go to the local Shaw's here and see, and I can tell by the cavity ID that we've made that in our facility. I can tell you exactly where it was made, and it's cool to see that our products on the shelves as well. Last one here, we do make the plastic containers for some contact lens packaging. So this is a daily contact lens, we make that, that's a very high cavitation, high speed, millions of parts per week going out the door. So next, yeah, some of the highlights with our business. We are a very large percentage of North American sales for Like I said, we do about $92,500,000 in sales, Nolado global is about a billion. So even in the grand scheme of things, we're close to 10% of Nolado, so Vermont's important to them. These factories are important to Nolado. Good thing is we have a long history, know, we supported local jobs in the area for many years. I think there's been multiple generations of some families that have worked at Nolato, formerly GW Blast six. As much as that's a highlight, it can also be a challenge too, but it's a good highlight that we like to point out. And another very good highlight is we're almost 100% focused on the medical market. Know, we're not making consumer goods that are going to ebb and flow. These medical products are here to stay. Medical companies don't like moving their manufacturing. It's not easy. There's a lot of validation. There's a lot of work. So it's very good for stability that we need for consistent sales and growth opportunities. Getting into some of the challenges, staffing and retention. We have a twelve hour shift in a rural location. I don't see a lot of other twelve hour shifts around where we are. And we've talked about, you know, do we go to eight hour shifts and do all these things, and it struggles because when you do that, I need to build more teams of people. So in reality, you end up needing more people, you know, on your total staff. Relocation for more urban areas is challenging for out of state candidates. I've found very much, you know, when someone on the phone says, oh yeah, I want to be more rural, I don't think they're picturing Bethel and Royalton as rural. It's a little disheartening when on basically the first interview I'm telling out of state candidates go on Zillow, on apartments.com, whatever it is, and make sure you're happy with the housing here, know, and it's hard enough after just the first interview before they even come on-site to kind of direct them to have to do that. And another challenge, we are within a thirty minute commute of Lebanon, New Hampshire area. There's a lot of industry down there, and there's generally I mean you saw the graphic seems to be generally tax implications are lower, which makes it hard to drag people or bring people up to the Vermont side. The next one I'd say a it's a challenge, but also a very big opportunity is a new leadership team. There's been a lot of new faces. I mean, as GW Plastics left, so did the old leadership and maybe the faces you guys knew. So over the last three years that's really changed, but I think opportunities like this are great. Know, I hear about a lot of programs and we need to make sure that we're engaging with them. It is nice to say there's a lot more familiar faces when I come here today than when I came here last time, know, people have come to our business. So like I said, I see this more as an opportunity, less of a challenge, but it's a kind of one of the things that we realized two or three years ago to say, hey, we need to make that connection at the state again, that I think was there for many years. The next one, expansion. Physical limitations, and that's kind of unique to I guess maybe the land we have, but I think Vermont land in general it can be tricky to expand quickly. Cost, and this is where being a global company, our counterparts in Wisconsin expanded I think three or four years ago, and we made a proposal to our team in Sweden, and the cost per square footage was just they couldn't even consider it when they see those two things on the paper. When they step back and not saying Vermont, Wisconsin, they're going say, well we're going to expand here. What are the drivers of that? I don't know the exact details, but the numbers numbers are the numbers when you bring it up to people outside of the state. Regulations, this is another one where we did look at a recent expansion, and I'm looking at the details of where it comes from, but I know we were limited on building size due to fire code. Otherwise you have to put in a firewall which can be greatly increased your cost or a whole separate building. But there was a regulation on how big the square footage could be, and like I said, I am kind of digging into where that if that's more local municipality or state, but did inhibit some expansion for us. And then a big one, expansion comes increased staffing. There was a project I would say three or four years ago that Milato Sweden was looking to put in Vermont, but it would need 200 more heads to make the products. It was very big, high volume, automatic assembly, and it went to Hungary just because to think about adding 200 jobs in that area in a short period of time, which it needed to be, was not really feasible. The other one, last one, plastics regulation. I say this is potential because I will give credit. People have reached out to me when there's a new regulation possibly coming down the line to ban a certain plastic, I would just make the point to say, you know, think about the use cases as well. I don't see the medical industry getting away from plastic very quickly. There's reasons why it's very valuable in medical. I'm not saying I'm not opposed to less plastic, but basically it's nice to keep it in mind that you know there are industries in Vermont that make medical products with different plastics, and that sweeping regulations could hurt us as well. So that's everything I've prepared. Once again, thank you for having us. I'm open to any questions on more details, and I can try and provide some as well. Thank you very

[Speaker 0]: Well, Amy's here, and Amy's the head of HR, and we do workforce. Our two committees are a big piece of our jurisdiction's workforce. Think we maybe, maybe speaking out of term, but I think we'd love to hear just a little bit more about how we, with our involvement in career and technical education at Vermont State University and all the certification for all the programs that we help oversee and can help work on, where can we help you there in particular? I think as Ben said, a lot of this is new leadership. So there's programs out there. And I just feel like having the connection and the outreach would be really important because we don't know exactly what's available. So I think that would be our first step. We've definitely talked to you guys before, and you've put some things out there. But just having a point person would be really helpful. We have worked with the local community. We have had programs at Vermont State University. We put employees through a manufacturing leadership program, and that's been really successful. We are working with them right now to tweak it a little bit to make it maybe more towards specific areas that people can do instead of a general class. I know we've had some outreach with UVM as well. There's just a lot right now, and we're just kind of trying to piece it together. So we can work on that offline, but as you may or may not know, we've created the Office of Workforce Strategy and Development. They should be your point person for all things workforce and are meant to be sort of bazaars of workforce for the state. So I would hope that you could create a connection with Savannah Haskell or Drake Turner to establish that, and then they can help you, direct you to whatever you need. Yeah, yeah.

[Dave LaForte (Co-owner, Built by Newport)]: And I

[Ben Bristow (Operations Manager, Nolato Vermont)]: think those programs are great and definitely encouraging and like training technical people. I think another thing we have to realize is a large part of our workforce, they are entry level operators. They really, when you have five operators fell out sick, it, you know, decimates the shift. So I think it's part of both bringing up the technical side, but also we got to remember the base of our workforce is, you know, the hourly wage people as well.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: I think that's maybe your local regional tech center can help you with that. I know previously that DW Plastics used to have people from students from the career center come in and work the line as well, so kind of an apprenticeship type thing.

[Speaker 0]: Because you have Hartford and Randolph close by, and of course River Valley, three great tech centers. Right, we do have an engineering manager who is working with the state currently reinstitute an apprenticeship program for our tool division. Yeah, well, and that's Jay Ramsey at Department of Labor. He's all of them. Great, thank you. Thank you.

[Ben Bristow (Operations Manager, Nolato Vermont)]: Thank you.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: Julie, David Weeks, you'll find me for it. And to your part. He is.

[Speaker 0]: All these teams. Partners everywhere. Partners everywhere. I'm afraid it takes a team. Good morning. Good morning.

[Dave LaForte (Co-owner, Built by Newport)]: I'm Dave LaForte. I am co owner of Built by Newport in Newport, Vermont.

[Julie LaForte (Co-owner, Built by Newport)]: Julie LaForte's co owner, missus, partner.

[Dave LaForte (Co-owner, Built by Newport)]: Husband wife.

[Speaker 0]: Husband wife. And still married. And still married.

[Dave LaForte (Co-owner, Built by Newport)]: Built by Newport is a family business that's located on the shores of Lake Memphremagog in Newport, and it was started in 1963 by my father. Over the last sixty three years, our business has needed to shift in order to stay relevant and actually stay in business. For many years, we were known for our glider rocker business, which many of you might know of. I think pretty much every household in Vermont has probably owned one of our glider rockers. And we were the first large scale US manufacturer of glider rockers back in the late '70s, and we were the last large scale US glider rocker manufacturer in The US. Unfortunately, imports competition from overseas destroyed that business for us, so we had to close that in 2014. Today, 70% of our business is fully assembled finished furniture, and 30% of it is furniture components that we supply to other furniture companies throughout The United States. We strategically, over the last ten years, have become a really diverse company as far as fully assembled furniture. We discovered early in our years that having more than one line of business in our facility really was impactful for us to keep our workforce, and it really helps us on downturns economically when things go south. Usually one line goes up and one line goes down. So today, we make dining chairs, accent seating, accent tables, mirrors, table bases, wood lamps, believe it or not, shelving and casement products such as storage cabinets.

[Julie LaForte (Co-owner, Built by Newport)]: So thank you for hearing our story here today, too. Dave and I became he's been in this business a lot longer than I have. I've joined him about eleven years ago now, so we've been partnered and still going strong since then. My role is overseeing leadership development in human resources. It's interesting. We were founded in 'sixty three. We have 63 team members, and this is our sixty third year. So, kind of an interesting fact right now. Our team members are our number one priority. We put a lot of emphasis on that. I like to say we're a small business in some ways, but I think that we're really sort of mighty in our contribution to the community and to the state as well. We put a lot of focus on providing really great jobs, not only in the work that they do, but also in the whole for the employee. So we work with a lot of partners. We work with a company called IHMS for physical therapy. So they do job safety analysis for us. They come on-site twice a month to work and interact with all of our team members and assess what they're doing, support them, provide some therapy if needed on-site. We also work with an occupational health provider in our town of Newport. So we take October, and we call that our health day, or health month, actually. So we partner with them to come in and provide just some sort of health coaching for all of our team members as well there. They do evaluations, and we want to ensure that it's just an opportunity for them to check-in. Again, we're really focused on the well-being of the whole employee. Another piece that we do is we work with Merrill Lynch for our four zero one program, which we're really proud of. And there's another resource that we bring on on-site during the day. Each of our team members can sit with them privately for a fifteen to thirty minute conversation and get some information about what they could do to help provide more stability for their finances. They even talk about just anything we can provide for more coaching and education that can support their dogs.

[Dave LaForte (Co-owner, Built by Newport)]: In 1994, my uncle Larry Daniel, some of you know, was our operations manager. And he had a vision that if we didn't bring in technology into our company, we wouldn't survive. So he went on the hard challenge of convincing my father and his business partner that we had to buy this CNC machine. So that year, we did purchase our first CNC machine. It was a huge expense. It was $300,000 and it was a game changer for our company.

[Speaker 0]: And CNC stands for?

[Dave LaForte (Co-owner, Built by Newport)]: Computerized numeric controller. So basically, are large machines that run from code that are generated from computers. Before we brought these machines in, all of our work was done by hand. So it was very dangerous work. We had exposed blades and tools that made it a really dangerous job. And this technology made our facility much safer and also allowed us to grow, and not only grow our company, but grow the skill sets of our employees. Today, have 11 of those machines in our facility. I can say from my travels that we're probably one of the highest technical furniture companies in The United States, And they're the heartbeat of our organization. They produce perfect parts, and then we have craftsmen in our assembly areas that produce beautiful furniture from perfect parts. Many people today say that technology removes jobs. I couldn't agree with that statement at all. It's really elevated our business and really kept us alive. And like I mentioned earlier, it's really elevated our team's skill set and has allowed us to increase wages, increase benefits, and provide better jobs for our community. Over the last ten years, there's been a real big shift in the market. The machines are getting more and more technical. The safety standards are getting higher. Think of it as your car. It's hard to find a mechanic if you work on any vehicle today. The machines are no different. And what's been challenging across The US is all of these distributors that sell this equipment can't find technicians to support the machines that they sell. Nobody today wants to be 20 fourseven on the road away from their families. So what we've had to do internally is train all our team members to self support our needs. So to address this, today, our maintenance team can pretty much diagnose and fix 95% of our issues internally. Our teams install our own equipment. Their skill set is so high that most times their skill sets are higher than the technicians that work at these companies. And we're at the point that we're actually building equipment in house as well. So we just recently did a large project where we converted three of our older machines to all new technology. New motors, new wiring, new controls, and everything was done in house, which has also elevated the skill sets of our payments team as well. The other thing that we've done that we started many years ago is we actually write and develop all our own software internally as well. So our entire ERP system has been built and written by our team in house. And what that's done is it allows us to quickly shift our systems production because everything's handled in house. We don't have to pay hundreds of dollars to hire outside firms to do this highly technical work. We do it ourselves. So that's been a big shift for us, and it's really allowed us to grow.

[Julie LaForte (Co-owner, Built by Newport)]: I think that sort of in that same theme, I was asked about CTE, that same theme, I think, of problem solving as much as possible for ourselves and being as independent as we can. I think that we've put a lot of energy in getting more involved with our local career center, which has been a huge win for us. It's a fantastic resource for us. We've been partnering with them for years and tried to really stay current and be as involved as possible. But in these last, I would say, five years, I think we've put the most emphasis ever on it. I actually serve on the regional advisory board there. I just heard that. Yes. And then we have three of our team members from Built by Newport that we have on various program advisory committees as well. I feel like that's not one of our greatest hurdles, if I'm honest. Working with the Career Center is an absolute pleasure, and they're a wonderful resource to us. I feel like they're always welcoming as much from us as possible. We have students come and do shadow days, which our team is than happy and excited to welcome them and provide whatever experience we can for them. And that varies. Some students, it could just be a few days. Others, it might be over the span of several weeks that they make up for a few days a week. And then we've had a lot of students that we have hired from the Career Center. I think there was an old model where we felt like when we brought on a team member, it needed to be, this is their career forever. I've recognized that we serve a role for a lot of different types of folks, right? There are some students that come out of school and they're not sure what they want to do yet. And we provide a wonderful opportunity for them to gain some skills, not only in manufacturing, but also just in employment and what it's like to have that kind of structure. So, that's been great. And with our continuing path with technology, the program aligns perfectly with us. I'm always impressed with what the faculty and the staff are doing there at the Career Center. Really, I'm just looking to expand that a little bit further out, work a little bit more tightly with some of the other high schools as well.

[Dave LaForte (Co-owner, Built by Newport)]: Speak about the project.

[Julie LaForte (Co-owner, Built by Newport)]: Yeah. And actually, I know we were highlighted for the coolest thing made in Vermont, one of the projects that they did for us. So, yeah, I just definitely want to do a shout out to the students there. One of the students that participated on that project was a blow off system for our CNC machines, is actually going to be doing a seasonal employment for us this summer. Great connection.

[Dave LaForte (Co-owner, Built by Newport)]: That was a graduate out of that program. I didn't go to college. So a lot of my skill sets came out of that career center and was the foundation to a lot of what we do today. So I have a lot of respect for that program. As far as our needs, I do want to start by saying, you know, COVID was a tough time for us. We were closed for three months. Honestly, we thought we were going to go out of business. But I'm sure many of you were probably involved in a lot of the grants that were provided during COVID. I just want to say a huge thank you. Those were instrumental for our business. So I just wanted to say thank you for all of you that were part of that, because it definitely helped us a lot. I do want to say that there's a lot of good that comes out of Mount Veolia, and I think there's a lot of great initiatives. But when those initiatives aren't looked at together, they can have a real big impact on businesses. So each goal of each committee, if not put together, can have huge ramifications. There's just two that come to mind. One is the childcare tax that was recently passed. Totally agree with the benefit of what that brings. But in my thirty five years of being in this business, I have not seen the escalation of fixed costs that we've experienced in the last three years. It's absolutely insane between property tax, electrical costs, insurance, health insurance. It's been a huge challenge to manage that because our industry, we still compete with overseas. So we can't simply just pass on fixed cost increases to our customers. So we have to figure out internally how to become more efficient to absorb those costs. So when the childcare tax came in, it seems like a small number. But when we're faced with all these massive fixed cost increases and you add that to the top, it just magnifies things even more. Another thing that comes to mind is the three acre rule. That came to a surprise for us. We're fortunate because we would have been faced with costs in excess of $200,000 to put a system in. Fortunately for us, our site is too small to put that system in. So now we just have to pay a penalty, which is still significant. I think it's not over yet. It's gonna be about $50,000 when you add all these costs, they're all good things. I agree with them. But they just really hurt us as a business. So it's a real challenge. And then lastly, I'll just say technology, as you've heard, is a big piece to us. It's allowed us to really increase our wages, increase our benefits, but it's expensive. Training, we've done a really good job internally because we've had to. You know, on average, it takes us about forty five days to hire one person. We put a lot of time upfront to make sure that we don't have high turnover. Happy to say two years ago, our turnover was only 7%. So we work really hard to keep our people and treat them well. But we do need the technology. So if there's any assistance we would need, you know, the grants, like I said, through COVID were phenomenal in allowing us to, you know, up our equipment needs so we could beat demand and volume. If there's anything that can be done to support equipment in the future for us, that would be a game changer. So that's all we got. We'll take questions if you have them, but we thank you I the have

[Speaker 0]: a question, Randy. Where do you source your wood? How do you partner with our wood forest products industry?

[Dave LaForte (Co-owner, Built by Newport)]: So we have an interesting model because back in 2000, we started a new facility in North Troy to do one process, which is just simply making solid wood panels and dimensional lumber. And at that time, we were sourcing a lot of our lumber locally and Quebec, so regionally. 2008 happened. Seventy five percent of our customers at that facility went out of business. So we had to shut that company down. And at that point, our factory in Newport was set up in that process where we were outsourcing our materials from that facility. So we continued that on with other suppliers. So today, we work with suppliers in Ohio, Pennsylvania, and Upstate New York that supply pretty much all of our hardwood lumber. Our industry has really become segregated because of the technology. It's difficult for a lot of companies to do everything. So we're experts in CNC ing and machining parts, and companies that are experts in making wood panels and dimensional lumber and moldings, because everything has gotten so expensive to support businesses. So we are trying to look a little bit more regional, but unfortunately, there's just not a lot of companies in Vermont that do the things that we need done.

[Speaker 0]: Species is a challenge too.

[Dave LaForte (Co-owner, Built by Newport)]: Species is a big challenge. Yeah, exactly.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: You talked about the repairs you have to make to the machines and having a hard time finding technicians to come out and do that. You have a number of right to repair bills that sit on our file. We've had a lot of discussions about that. Is that an issue for you working with companies that build your machines?

[Dave LaForte (Co-owner, Built by Newport)]: It's starting to be, especially because we're so custom in our facility. We customize everything. It was a limitation on when we went out four years ago to source a new machine that we wanted. A lot of the companies that we were working with had their controllers locked down. So there was no way for us. So we strategically picked a company that allowed us to go in, but I have a feeling that that's gonna be changing soon. So, yes, that could be a huge issue for us. You know, this equipment's really expensive. The machine that we first bought in 1994, we converted to new technology. So we kept that machine running all those years because we could fix it. And they are strategically changing that so you can't fix it.

[Speaker 0]: That's how insane. How great that you've trained these technicians. There are other places in Vermont that use those machines, and you could outsource your technology and create another source of earned revenue.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: Oh,

[Speaker 0]: Emma.

[Amy Spear (Vermont Chamber of Commerce)]: Thank you so much for sharing your story. I am curious about what species of wood do you normally deal with?

[Dave LaForte (Co-owner, Built by Newport)]: So our number one species today is walnut.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: We don't want a lot.

[Kevin Moyer (Owner, Vermont Frames)]: We don't want a lot.

[Dave LaForte (Co-owner, Built by Newport)]: But that's changing because of the price of lumber, especially walnut and white oak. A lot of our customer base now is turning back to red oak, which I never thought I'd seen. Red oak used to be the number one species in the eighties. Like when any house that was built in the eighties and the cabinets, kitchen cabinets will be right out. And honestly, that is a good thing because that's going to allow us to become to be go a little more local. So we're actually pretty excited about that.

[Amy Spear (Vermont Chamber of Commerce)]: Fantastic. Thank you.

[Dave LaForte (Co-owner, Built by Newport)]: Yeah.

[Speaker 0]: I think we need some Kevin Moyer, thank you very much. You so much, David.

[Dave LaForte (Co-owner, Built by Newport)]: Absolutely.

[Speaker 0]: And Kevin Moyer, wherever you are, thank you for stepping in as we have a witness shift. Introduce yourself and tell us what this is you have because we don't have that here.

[Kevin Moyer (Owner, Vermont Frames)]: Hi, everybody. My name is Kevin Moyer. I'm the owner of Vermont Frames and Pearl Maintenance of Vermont. We are a timber frame and structural insulated panel manufacturer located in Starkville, Vermont, again, in Addison County. Been there since 1976. So please come and join us this summer for our fiftieth anniversary.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: We'll be

[Kevin Moyer (Owner, Vermont Frames)]: inviting the whole community for that.

[Speaker 0]: You might have to turn that microphone on. That microphone actually isn't the microphone. Thank you so much. Just have to

[Kevin Moyer (Owner, Vermont Frames)]: I should just speak louder. Oh, god. That's okay. My slides came through today. There we go. That's us.

[Speaker 0]: Right.

[Kevin Moyer (Owner, Vermont Frames)]: Okay. So there's a picture of what we do. So we're both a manufacturer and and a subcontractor in the construction world. There we are in Starksboro. Four teams, 28 people doing design, fabrication, and usually the installation of the timber frame and the panels on job sites ranging from Maine to Jersey. We do about 50 or 60 projects a year, mostly housing, some barns, some pavilions. Just built a pretty cool outdoor classroom for the Ramon Common School down in Charlotte. So different configurations we can work in, whether it's just the timber frame or just the panels, whether it's an installed projector kit. Just a quick visual of what that looks like on a job site for us and the general contractors and builders we partner with and the architects that we partner with to create these structures. Zooming out mission of the company is to build great homes for people and great careers for our team. I really appreciate the opportunity to come here and speak to you today. Vermont's a beautiful place. I love being here. There are some aspects that are awesome about doing business in Vermont. There's also some challenges. I definitely appreciate the the folks here who are supporting s three one three that the community to sorry. The career technicals, education centers, the CTVs in the state are awesome. We love hiring graduates from there, and I would ask that you all do whatever you can to support that bill and any other bills that can elevate, highlight, showcase, celebrate careers in manufacturing and craftsmanship in the trades. We need those folks. I I am we host probably four to five high school wood shops a year in our shop, keeping a little bit of hands on time with schools. We just actually hosted Otter Valley High School yesterday. About 20 folks in there playing with chain mortiser and circular saws and then learning what a mortise and chain joint is and how that goes together. So it's fun to to bring those folks in, and it's encouraging to see you know, I talk to the shop teachers when they come in, and I ask them how many folks are signed up for your class. They're like, oh, I'm oversubscribed, which is, like, really encouraging to see folks wanting to take Woodshop and Metal Shop and learn to make things again. So that's that's great. Couple other slides in here. I'll I'll just get to really quickly. It's the the shop drawings we generate for our timber frames. That's our timber shop. Still doing things the old fashioned way. A lot of admiration for for technology and CNCs. We are at the other end of that spectrum. We're about as low tech as you get. We're we are hand laying out the inside and clearing and putting big beams together. You're asking about wood species earlier. We work predominantly with eastern white pine that comes out of Vermont, New York, New Hampshire, very local, very sustainable source. We do also work with Douglas fir from our friends in Canada. Those are pry predominantly what we work with. We do some Amloc and some some red oak as well. And then there's our panel shop where we're creating those structural insulated panels to create that shell. Gives you a really energy efficient house. Mhmm. And that's what we look like in the field, building up a timber fairing. And going for full time, long term, year round employment, that doesn't mean we work through the winter. I know there was some some language about extreme heat and extreme cold that was being floated around. This is impossible if that that kind of thing passes, and and I very much wanna be a twelve month a year employer to my whole team. So we do have to be able to build outdoors all year round. We're very safe. We take breaks when needed. We don't have a cold and heat injuries. You know? So that's the goal there. More more photos of our shop and some of the the trusses. That was for summer camp over in New York. Big set of trusses for their dining hall, panel with some windows cut out of it. So just to give you a sense of what we do, and then that's the joinery up in up in the air. There's a little bit of a lag here, it seems like, from the lap. There you go. Some of the other bills before you that I would ask you to support that that PACE bill for commercial industrial projects. Two years ago, we looked at getting solar and batteries into our facilities so we could be more green, use less oil, and less less energy, be be more environmentally friendly. It ended up being a $125,000 for us to to do that and just couldn't make that work at the time. So it feels like that helps small businesses like ours and really do factor into decision making for how we think about those kind of major investments. Supporting the employment growth incentive and repealing that that sunset with s three twenty seven, you know, helping employers like me onboard and train, bring up future timber framers, future crane technicians, future crane operators who can help us build the housing we got in need of the state. When I zoom out and look at our business and where we're headed and and the challenges we we face, it's really people, and then where do those people live, and then the the actual space for us to grow. We're on two and a half acres in Starksboro. Unfortunately, we are entirely landlocked by a farm that is in the Vermont Land Trust. The farmer wants to sell me an acre or two out of 200. I wanna buy it. And, unfortunately, the Vermont Land Trust has said no to that, so I can't grow. I could probably create five or 10 more jobs in rural Vermont pretty quickly if I had a little bit more facility space to to buy a little bit of land and put another warehouse in there and build more housing for the modern. So that's a it's a pain point. Very much respect the the goals there of of what the Vermont Land Trust is here to do and admire that.

[Speaker 0]: How recently was that decision made by that board?

[Kevin Moyer (Owner, Vermont Frames)]: Here we go. That's too bad. It's it's pretty, pretty painful, but we are looking at other options. So we'll we'll see what we can do. But I would like to grow. I would like to build more housing, create more jobs. So that that's a pain point. Certainty, as as some of the other folks here have been testifying today, businesses when we're looking at making investments, whether it's research and development to develop a new type of panel for housing that has to go to a lab, and there could be a five rate and a 6 figure cost associated with testing that panel in a laboratory. Obviously, the r and d tax credits really do help and do factor into turning a no into a yes when you're doing that ROI analysis as a business. Overall, this growth in general, this summer went through an endeavor to build three three sided storage sheds on already impermeable land at our facility, basically just trying to get raw materials covered from the rain and sun. No electricity, no plumbing, no additive permeable. Took six months, $3,000, and five Vermont state agencies to get an approval for that. Pretty painful. Again, I'm lucky I have enough staff that I can just power through that and get over those hurdles, but I can imagine smaller we're only 28 people, so we're pretty small, but we could do it. I imagine some even smaller business in Vermont will look at that set of hurdles and say, not worth it. You know, I just I wouldn't do it. So, again, a lot of well intentioned regulation that's good for the environment. I wanna be able to swim in Lake Champlain. I get why we had stormwater runoff fuels. Making that make a little more sense and factoring in the economic impacts of that, the business impacts of that So if it's done in a wise way, it doesn't drive too much cost such that the the project doesn't pencil and the the business doesn't grow, the jobs don't get created, the homes don't get built, then it's stagnant. So that's the goal there. One other thing to to keep in mind too, especially with with heavy machinery, diesel is really the only way some of the stuff gets done. I I love battery technology, battery electric vehicles that very much support going in that direction over the long term. You're operating a 28 ton crane and lifting up a 5,000 pound set of timbers, a diesel motor and a hydraulic system is probably the way you're doing that on the side of a mountain or out in a rural area. So there's still some use cases for diesel heavy equipment that we just need to make sure we have some thoughtful exceptions for for these otherwise very good vehicle efficiency mandates that that I see people pushing for, which I support overall. I'd love to have a hybrid electric, diesel electric fleet of vehicles. And soon as GM makes that truck, I'll buy five of them, but we're not there yet. I mean, just think about what what the industry can keep up with, what the manufacturing base can keep up with the changes over time. I think that covers everything I wanted to talk about. I really appreciate the opportunity to

[Speaker 0]: be here. Thanks, Jonathan.

[Rep. Jonathan Cooper (Bennington District; House member)]: Thanks very much, Kevin. I really appreciate it. I was curious with your 10 28 individual staff of if you can decide to give a median age and tenure, how long people have been there? Great question. I'd say there's a gap. We have about half of them that are probably north of 50 years old, and then the other half are under 30. There there was a really just total drop in we're still feeling the effects of 2008 and all the carpenters who got out of construction in 2008 and never came back, and they're doing something else now. And I my probably number one focus as as an owner right now is recruiting and retention and career path and developing the future timber framers and and builders who are gonna keep this crap alive and keep it going. Yeah. Thanks.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: I just want to ask everybody a question in here. How many of you know, if you have a question or if you are looking for a grant, low cost money, questions about permitting. How many of you know where to go and how to find those answers?

[Speaker 0]: That's not great. No, but

[Julie LaForte (Co-owner, Built by Newport)]: it's really helpful

[Speaker 0]: for to So ask we appreciate your honesty there.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: That was So,

[Speaker 0]: yeah. Sorry, Nancy. No, no, this is very important because we're looking, one of the things we're looking at is looking at all stages of business development from startups to early stage to maturing to mature. And we're looking at all the resources we currently offer and what are the gaps, what do we need to offer, and how are we communicating it? How are we marketing all these incredible resources that we have? Which we actually have quite a few. And that was a very discouraging response that wanted to raise that. So that supports the fact that

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: we have to do this work.

[Speaker 0]: Have fun. I know why. Our water pots are Pretty local stuff. Our water no.

[Ben Bristow (Operations Manager, Nolato Vermont)]: No, catamels.

[Rep. Michael Marcotte (Chair, House Commerce and Economic Development; Coventry)]: That's right. Okay.

[Speaker 0]: We sadly have to go back to our committee work. We hope you have a fabulous day here at the State House. You're also, as you know, we're all accessible. One of the things you didn't talk about was how one of the great pluses of Vermont is the accessibility of the lawmakers to you. And that is in other states, work in other states say, Wow, you are so successful. And of course we are. So be in touch and let us know how we can continue to help you in significant ways. Thank you very much. Thank you, Amy and Chittenden.

[Megan Sullivan (Vermont Chamber of Commerce)]: Right, folks. Megan Sullivan with the Vermont Chamfer.

[Kevin Moyer (Owner, Vermont Frames)]: So

[Megan Sullivan (Vermont Chamber of Commerce)]: our wonderful committee, thank you so much for your time. They're going to head back as we

[Speaker 0]: do