Belfast looks to establish Foreign Trade Zones to benefit area businesses
Belfast — Belfast's economic development director discussed the possibility of bringing an underused and poorly marketed business incentive to the city.
Speaking to councilors Tuesday, Dec. 3, Thomas Kittredge, economic development director, said there is an opportunity for Belfast to establish a Foreign Trade Zone program within the city. The city is exploring the program in conjunction with the Central Maine Growth Council, Kittredge said.
Kittredge said such a zone can create benefits for area businesses through delayed or reduced duty payments on foreign merchandise, the ability to need to only file a single customs entry for an entire week's outbound shipments and an exemption from state/local inventory taxes, among other benefits.
Currently, there are five Foreign Trade Zones in the state — Auburn, Bangor, Brunswick, Madawaska and Waterville. Belfast is associated with the Waterville zone due to it serving as the designated Port of Entry for Waterville.
While the program isn't new to the state, Kittredge said the program hasn't been used much and isn't well advertised.
Kittredge said the Central Maine Growth Council recently renewed the Waterville-based Foreign Trade Zone and the organization is now looking at reconfiguring the zone into an alternate site framework. What that means is that communities that are located within a certain radius of an established Foreign Trade Zone, such as Belfast, would also benefit from the program.
Previously, the only way a business would benefit from the program is if that business was located in Waterville, Kittredge stated in a memo to councilors.
In order to restructure the Waterville Foreign Trade Zone, Kittredge said the Central Maine Growth Council is considering hiring the Memphis-based FTZ Networks firm that has “extensive experience” with the program.
The Central Maine Growth Council estimates the cost of hiring a consultant to reorganize and develop a “strategic marketing program” to increase participation in Foreign Trade Zones by businesses is estimated to cost $34,555.
As a result, Kittredge said the Central Maine Growth Council is seeking contributions from communities and entities in the range of $5,000 to $7,500 that would benefit from the program.
City Manager Joseph Slocum commented there are businesses in Belfast, such as Mathews Brothers, that sell their product outside of the United States and could potentially benefit from the Foreign Trade Zone program.
Councilors approved contributing $5,000 to the Central Maine Growth Council efforts to expand and market the Foreign Trade Zone program.
Ben Holbrook is a reporter for The Republican Journal covering general news.
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