Charlotte, airport move to expand foreign trade zone

Almost 4,000 acres at and around Charlotte’s airport could soon be designated a foreign trade zone, a move officials hope will lure warehouses and factories with the promise of lower taxes.

The airport zone is part of a broader application by the Charlotte Regional Partnership to get 15 counties designated as eligible for the reduced taxes available in foreign trade zones under new, streamlined federal rules.

Much of the Charlotte region currently has foreign trade zone status, but the process for companies that want to use it is cumbersome, said Laura Foor, the CRP’s administrator for the zone.

Under current rules, it can take a company more than a year to get approved to use an area’s foreign trade zone status. Foor said that if the Charlotte region is approved for the streamlined rules, that time would drop to three to six months.

“It speeds up access to the program,” she said. She’s spearheading the application, which was filed last week.

Only one company is listed as actively using Charlotte’s foreign trade zone program. DNP IMS America, which makes waxes and resins for printing at its Concord facility, exported between $10 million and $25 million worth of goods, according to the 2012 Foreign Trade Zone Board’s annual report.

“This could be a great opportunity to reorganize our zone and make it more useful, and get more companies involved,” said Foor.

Foor said she hopes Charlotte’s application to the U.S. Foreign Trade Zone Board will be approved by August.

Charlotte Douglas International Airport has seen rapid expansion in recent years, with a third runway, Interstate 485 and a new, $90 million Norfolk Southern rail yard adding more transportation capacity. Now, city officials want to spur a building boom of warehousing, manufacturing and logistics companies on land surrounding the airport – all of which could benefit from being part of a foreign trade zone.

The airport is requesting that 3,900 acres, about two-thirds of its area, be declared a foreign trade zone.

“The approval of this application will give companies utilizing the new, state of the art intermodal (rail) facility and adjacent areas a competitive advantage of a tax relief business zone,” Charlotte City Manager Ron Carlee wrote in a letter supporting the application.

Carlee and other Charlotte officials envision warehouses, shippers and other businesses sprouting up around Charlotte Douglas to create a new “ edge city.”

Norfolk Southern’s rail cargo yard opened late last year, between two runways at Charlotte Douglas. The yard transfers cargo from trains to trucks and vice versa, and it has the capacity for 200,000 transfers a year. Norfolk Southern favors the foreign trade zone plan – which would cover its rail yard – and said in a letter of support that it could boost business.

Interim Aviation Director Brent Cagle said in a letter that the areas around the airport are “scheduled for future compatible development,” or warehouses and other industrial uses, and will be developed according to market demand. Those will benefit from access to a foreign trade zone, he wrote.

Included in the areas around Charlotte Douglas are a 370-acre neighborhood the airport is buying for $35 million. Officials plan to demolish the homes there and build warehouses to support the Norfolk Southern rail facility, which they would then lease to private companies.

Charlotte Douglas is an independently funded department owned by the city. Although the N.C. General Assembly passed a law last year transferring control of Charlotte Douglas from the city to a new, regional commission, the law has been blocked by a judge, and the commission remains in legal limbo.

Foor said the tax savings under the streamlined trade-zone rules are unlikely to be enough to lure companies to Charlotte on their own. But, she said, it’s another tool economic development officials can use.

“It can just be another check mark in the favorable column,” she said.

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