The Jefferson County Industrial Development Agency has approved a fee structure for businesses that apply for Foreign Trade Zone benefits.
Businesses now must pay $1,000 to submit an application to the agency to acquire FTZ status, a $2,000 activation fee after applications are approved and a $2,400 annual fee, according to the fee structure adopted at the agencys board meeting Thursday.
The FTZ program is designed to help manufacturers and distribution companies lower operational costs by reducing or eliminating duty and tax payments on foreign parts of finished products.
The agencys decision to charge businesses seeking the status follows the expansion of Jefferson Countys Foreign Trade Zone, approved by the U.S. Foreign-Trade Zones Board last month. Sites include the 122-acre City Center Industrial Park on Arsenal Street; 1,059 acres at Watertown International Airport on Route 12F near Dexter; and a 95-acre expansion of the Jefferson County Corporate Park on Coffeen Street, adding to the original 115-acre zone at that site.
Spurred by the expansion of the countys trade zone, the JCIDA expects more businesses here to apply for FTZ status soon, said David J. Zembiec, deputy director. Mr. Zembiec said the fee structure, which will pay for services rendered by the agency, was determined by comparing rates offered by other IDAs across the state and country.
Our fees are on the lower end, and were just looking to cover our costs, he said. Companies that participate in the program will be able to pay back the annual fee easily from the savings generated by the program.
The Albany Industrial Development Agency, for example, charges an application fee of $4,000, an activation fee of $1,500 and an annual fee of $2,500.
Businesses are increasingly taking advantage of importing and exporting products overseas in todays global economy, Mr. Zembiec said.
Operating in the Jefferson County Industrial Park, North American Tapes was the first company that applied to enroll in the countys FTZ program, in the fall of 2011. The company, which is still awaiting approval from the U.S. Foreign-Trade Zones Board, expects to save money on the athletic and hockey tape it produces by acquiring the status.
Mr. Zembiec added that a handful of local companies have expressed interest in the program.
I think were now going to see more interest because its a much more global economy, he said. You have a number of companies importing things, and you have competition from China manufacturing things that are coming into our market. This levels the playing field so that domestic companies can compete.
Donald C. Alexander, CEO of the Jefferson County Industrial Development Agency, said the newly launched FTZ program should set the stage for future growth. He cited the corporate park planned at the airport now part of the countys foreign trade zone as an example.
We believe more businesses are going to use this, he said. We now have a global economy, and this is going to attract large companies.