Airport business park attracts new companies
A business park near the Lincoln Regional Airport is receiving attention from several companies about the benefits being located there, such as tax breaks, special financing and good labor accessibility.
Companies already at the Lincoln Airport Business Park include Rogers Family Coffee since 2009 and Gulfstream California, Inc., since 2012.
The area east of the airport is a Foreign Trade Zone (FTZ), according to city of Lincoln’s economic development manager Shawn Tillman.
“A Foreign Trade Zone is an area where foreign and domestic merchandise is considered to be outside the U.S. Customs territory,” Tillman said. “Certain types of merchandise can be imported into a FTZ without going through formal Customs entry procedures or paying import duties. Customs duties and excise taxes are due only at the time of a transfer from the FTZ for U.S. consumption.”
Operating within a Foreign Trade Zone carries several benefits, Tillman said, including:
- Delayed tariff payments on imported products
- Choice of finished product tariff rate for goods, further processed inside the Foreign Trade Zone
- Complete tariff avoidance if products are exported directly from the Foreign Trade Zone or if products are assembled, packaged and then exported
- Payment of duties only on the value of the foreign components, not on labor overhead or profit
- Exemption from state and local inventory taxes on foreign merchandise
- Potentially lower insurance premiums
- Temporary or complete avoidance of quota restrictions.
Tillman said Precision Medical Products will move to Lincoln and take advantage of the Foreign Trade Zone designation around the airport, according to Tillman. The manufacturer of medical devices engineers and produces needles and other precision-crafted metal products.
Precision Medical Products’ Chief Operating Officer Bruce Capagli said the Foreign Trade Zone helps his company “a lot” because many of its products are imported. Imported products have an individual processing fee at Customs of about $483, Capagli said.
“Within a Foreign Trade Zone, you can do a single, weekly filing,” Capagli said. “If you have 10 items, for example, you can consolidate the processing fee into one filing of $483 instead of 10 at $4,830.”
“There’s also a tax deferment when shipping between two FTZs,” Capagli added. “When we ship to a FTZ in Costa Rica, we don’t have to pay the export fee and can defer the duty taxes. The tax liability is incurred when the product leaves the FTZ.”
Placer County is a Recycle Market Development Zone (RMDZ), which offers an incentive package that includes attractive loans, marketing money, and technical assistance to encourage manufacturers to use post-consumer materials ending up in the landfill. The zone’s focus zone is to divert and develop sustainable markets for priority materials.
Circular Polymers for the last year is building a manufacturing plant near the Lincoln Area Airport that should be completed within two weeks. The company recycles carpet and turns it into raw material used for industries such as beverage and packaging, housing and cold chain management.
Circular Polymers CEO David Bender “is excited” to be doing green technology business in Lincoln.
“Circular Polymers is taking carpet and turning it into fiber and polymers,” Bender said last Thursday. “The Recycle Market Development Zone is definitely very important to us. The RMDZ enabled financing for our new line and for our new plant. It enabled us to move forward and get some financing from the state.”
The company also receives a partial sales tax exemption for being named an Advanced Manufacturer by the California Alternative Energy and Advanced Transportation Financing Authority, according to Bender.
“I like Lincoln. It’s a great town, a good place to do business and has access to good labor,” Bender said. “Once the plant is fully finished, we expect to employ 40 to 50 people.”
“While Lincoln’s unemployment rate is low, some surrounding communities are not so fortunate,” Bender added. “Also, the effect of more manufacturing in Lincoln will spill over into the entire downtown district.”