Import Program To Boost Business
http://www.whittierdailynews.com/news/ci_3614844
Import program to boost business
Area to become tariff-free zone
By Ben Baeder Staff Writer
INDUSTRY - A federal program designed to attract businesses - and jobs - to the area is on the verge of approval.
Within in the next two weeks, city officials expect about 500 acres in Industry and Whittier will be included in a federally designated foreign trade zone.
The designation will allow companies in four areas in the city to avoid paying import fees on goods moved directly from a foreign country into the designated area.
The zone could save companies millions, according to leaders in the area's business community.
"It's something we are really excited about," said Whittier Chamber of Commerce Executive Director Don Sachs. "We think this is going to make moving here and staying here a lot more attractive to businesses."
A foreign trade zone is an area within 60 miles of a U.S. port of entry where products can be stored, tested, exhibited, destroyed, repackaged, assembled or manufactured duty-free until sold for U.S. consumption, according to information provided by David Harlow, a consultant working for Industry.
Along with the obvious benefits of not having to pay taxes all at once, the zone could encourage manufacturing, Harlow said.
Often the components of a product - like speakers and a computer chip for a portable stereo system - have high tariffs, Harlow said. But there may be no tariff on the finished unit.
"So, when they ship it out, they sometimes will pay no import fees," he said.
In addition, if a product moves directly from the foreign trade zone to a foreign country, the business owner will not have to pay any U.S. import fees.
Areas expected to be included in the foreign trade zone are the Grand Crossing project in eastern Industry, the nearby Fairway Business Park, Golden State Foods near Nogales Street and the Gateway Pointe Business Park in Whittier near Rio Hondo College, according to Harlow.
Officials at the U.S. Department of Commerce confirmed that an application for the zone was pending. The zone is listed as an extension of a zone that stems from the Southern California Logistics Airport Authority in Victorville, according to documents posted on the department's Web site.
There are 18 foreign trade zones in the state, according to the Department of Commerce. Part of El Monte is also included in a foreign trade zone.
Kent Valley, a senior vice president at Majestic Realty Co., said he believes the program will bring more jobs to the area. Two of the areas in the zone are owned by Majestic.
"It's one more thing that helps us compete," he said.
For general information about the Foreign Trade Zone, go to the Department of Commerce's Web site: http://ia.ita.doc.gov/ftzpage/
For information about the zone planned for Industry, call David Harlow at (562)843-6962.
ben.baeder@sgvn.com
