New London looks to expand benefits of Foreign Trade Zone
New London — With the advent of offshore wind companies coming to New London and an increase in activity expected at State Pier in the coming years, the city is making a move to expand the boundaries of its scarcely used Foreign Trade Zone.
The plan is to expand the zone to include all of New London County. Zones can be located within 60 miles or 90 minutes from a U.S. Customs and Border Protection port of entry. New London happens to have the only local port of entry, welcoming ships from overseas.
Foreign Trade Zones are sites that are considered outside the U.S. Customs territory where companies can defer or eliminate customs duties on foreign products coming into the zone for storage, assembly, manufacturing or processing. If a company imports something like lobster to the port, warehouses it temporarily and ships it out to another country, the company would never have to pay a duty, according to Tom Bombria, the city's community and economic development coordinator and liaison to the New London Foreign Trade Zone Commission.
The city is preparing an application with the U.S. Foreign Trade Zones Board to reorganize its zone into what is known as an "Alternative Site Framework," which would allow companies to gain the benefits without being in the 138-acre designated site that now encompasses State Pier.
"This is a tool to help promote business growth in Southeastern Connecticut. I think it would be irresponsible not to do it," Bombria said.
The New London Foreign Trade Zone Commission administers the program now for two companies: pharmaceutical giant Pfizer and Safety Zone, a Guilford-based company that imports work gloves. Safety Zone maintains a warehouse within the zone while Pfizer has an unused site across the river in Groton, which is designated as a subzone.
The two companies are not currently active but maintain their status by paying annual fees for administration of the program: $7,500 a year for Pfizer and $8,000 a year for Safety Zone.
Since there has been limited activity in the zone over the nearly two decades since it was set up, Bombria said expansion has been considered for years.
Bombria and New London Mayor Michael Passero recently gained support from the member municipalities of the Southeastern Connecticut Council of Governments, whose leaders are expected to write letters of support for the effort.
“If you have a commercial development, warehouse, business in your community, this proposal will allow that business to be able to access the benefits of New London’s foreign trade zone in a much less cumbersome and expensive manner than we would have to do currently,” Passero said at the recent council of governments meeting.
The move would follow the expansion of the foreign trade zone around Bradley International Airport in Windsor Locks to Hartford, Litchfield, Middlesex and Windham counties. Other foreign trade zones are in New Haven and Bridgeport.
“Since New London has a foreign trade zone, in New London County the only way that businesses in your community would be able to access the benefits of the foreign trade zone would be to join New London in expanding the current, existing foreign trade zone at the State Pier,” Passero said.
Bombria said the planned infrastructure upgrades at State Pier and expected components of wind turbines coming in, a variety of companies importing, assembling or manufacturing products could reap benefits.
The city-owned land on Crystal Avenue that was home to the Thames River Apartments complex, for instance, sits just outside the designated trade zone. It could be included in the new expanded foreign trade zone and allow for benefits if it becomes a staging area for products coming from State Pier.
Bombria said he is preparing a request for proposals for a consultant to complete the application for the expansion. He expects the consultant also will hold seminars and advertise the benefits to local businesses.
Day Staff Writer Kimberly Drelich contributed to this report.
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