Arizona Business Magazine July/August 2011
West Valley Cities Are Looking Toward Foreign Trade Zone To Boost Their Local Economies
After three years of hard work and dedication, WESTMARC and West Valley city leaders finally saw their labor come to fruition with the formal granting of the Greater Maricopa Foreign Trade Zone (GMFTZ) in December.
The establishment of the Foreign Trade Zone began following the Foreign Trade Zone Act of 1934.
Most FTZs are applied for by a single city, but Harry Paxton, economic development director for the city of Goodyear, says the GMFTZ is one of only a few in the United States that was supported by a consortium of cities for an entire region. The application fees were paid by landowners of the properties in the region requesting FTZ status.
“It is vital to high-volume importers and exporters (foreign or domestic) operating the United States in reducing duty fees and speeding up the supply chain, allowing companies operating … to maintain competitiveness,” Paxton says.
The GMFTZ, he adds, “is a valuable tool that is useful in attracting and retaining businesses, and creating new job opportunities.”
Paxton is a member of the GMFTZ Advisory Council, which was formed so each city participating in the GMFTZ would have representation.
The cities in the West Valley that are participating in the FTZ are Avondale, Buckeye, El Mirage, Gila Bend, Glendale, Goodyear, Surprise and Wickenburg. WESTMARC became involved in the process after community leaders with Goodyear and Surprise approached the organization requesting its support.
The approval in December gave FTZ General Purpose Zone status to four sites:
AIRPORT GATEWAY AT GOODYEAR
This 230-acre site located from Van Buren Street south to Yuma Road, will have approximately three million square feet of industrial and work space. It is located in close proximity to Phoenix Goodyear Airport, which is constructing an additional 4,300-foot runway and a new entrance to the facility, which will be adjacent to the FTZ site.
SURPRISE POINTE BUSINESS PARK
Located on the southeast corner of Waddell and Litchfield roads, this 130-acre site has access to the Burlington Northern Santa Fe Rail Line, which will send goods to Los Angeles ports.
PALM VALLEY 303
Located north of Indian School Road along Loop 303, the site features 1,600 acres and has designated 235 acres for FTZ status. Development of the entire project will be phased over the next 20 years and is expected to feature 20 million square feet of office, retail, warehouse and industrial space.
10 WEST LOGISTICS CENTER
This 318-acre site is located on 339th Avenue and the I-10 in Buckeye, providing easy access to the freeway.
Several additional sites throughout the West Valley are under consideration for FTZ status, including the Goodyear Crossing Industrial Park, a 198-acre site at the northeast corner of MC 85 and Cotton Lane.
The benefits to being in an FTZ, Paxton says, are numerous.
“Businesses in FTZs are treated as though they are outside U.S. Customs territory, and merchandise that is repacked, assembled, manufactured, displayed or placed in storage can be brought into the FTZ duty-free,” Paxton says. “Imports can be moved more quickly, without full Customs formalities. In addition, qualifying businesses located in a FTZ in Arizona are eligible for substantial reductions — currently 75 percent — on real and personal property taxes.”
Several large companies already have started construction or announced plans to start a location on the FTZ sites. A facility for appliance manufacturer Sub-Zero, based in Wisconsin, is under construction and will bring an estimated 380 jobs to Goodyear. In addition, the plastics manufacturing company Schoeller Arca Systems, based in the Netherlands, will hire an initial 45 employees for its new site in Goodyear.
Companies based in an FTZ, Paxton explains, must comply with regulations set by U.S. Customs officials. Communities benefit from these regulations as well, he says, due to the higher levels of security for imports.
Moving forward, Paxton says his goals for the GMFTZ revolve around helping not only the city of Goodyear, but also the entire West Valley.
“(I want to) ensure that each community that has a desire to participate has the best opportunity to succeed in helping existing employers expand and attract new employers to their respective communities, which will create new jobs for our citizens.”