Free-trade bid could benefit SuffolkPublished 9:30pm Monday, October 1, 2012
A bid to reorganize the foreign-trade zone granted to the Virginia Port Authority in 1975 could help entice businesses to Suffolk and existing operations here to expand.
The authority says it was granted what is known as Foreign Trade Zone (FTZ) 20 on April 15, 1975.
The free-trade designation allows business in covered sites to defer, reduce or even eliminate customs duties on parts, materials and components imported for manufacturing in the United States, reining in the competitive advantage of imported products, the authority says.
At a meeting last week, the authority Board of Commissioners endorsed an application to reorganize FTZ 20 under the International Trade Administration’s Alternative Site Framework (ASF), which would designate Suffolk’s sprawling CenterPoint Intermodal Center a “magnet” site.
Kevin Hughes, city economic development director, said Suffolk has been proactive in promoting the benefits of the FTZ.
“We have been actively marketing the Foreign Trade Zone as a benefit to prospective companies,” he said.
After starting with 22.5 acres, FTZ 20 now covers more than 10,000 acres, according to the authority.
Four of the zone’s 30 sites and sub-sites are located in Suffolk: PakAL-USA Inc. on Suburban Drive, Evans Distribution on Moore Avenue, Bridgeway Commerce Park off Interstate 664, and Carolina Road’s Suffolk Industrial Park.
Speaking on the condition of anonymity, a senior U.S. Commerce Department official said that under the ASF framework, new FTZ 20 site applications would be fast-tracked by being assessed within 30 days.
“Once approved … then henceforth the Virginia Port Authority will be able to use the 30-day process,” the official said.
The official explained that so-called magnet sites are designed to draw multiple FTZ users; distinguished from other industrial sites, they are generally “something like an intermodal facility.”
“Within Foreign Trade Zone 20, I think there are something like 15 to 20 magnet sites,” the official said.
An authority application would take 7 ½ months to assess, including a two-month public comment period, “recognizing that it can be performed more quickly, if our workforce enables that, for example.”
Two operations so far have located in the 900-acre CenterPoint Intermodal Center on Holland Road: Ace Hardware’s 336,000-square-foot distribution center, which was expected to create 75 full-time jobs, and the Navy Exchange Command.
America’s more than 250 foreign trade zones spur merchandise exports worth $40 billion annually and employ almost 330,000 workers, according to an International Trade Administration press release.