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NEOTEC Contracts with Cleveland Port Authority

January 14, 2012

Partnership Creates Regional Foreign-Trade Zone Advantage.


The Northeast Ohio Trade & Economic Consortium (NEOTEC) has entered into an agreement with the Cleveland-Cuyahoga County Port Authority for the administration of Foreign-Trade Zone (FTZ) 40. The Port Authority is grantee of FTZ 40, which includes 10 sites totaling more than 5,600 acres in Cuyahoga, Lorain and Ashtabula counties. NEOTEC, a nonprofit regional economic development organization located in Kent, is grantee of FTZ 181, with 27 sites in 8 counties throughout Northeast Ohio. The agreement brings the combined acreage of both zones to more than 11,000.


In addition to streamlining zone administrative duties, the partnership will enable NEOTEC to enhance domestic and international marketing efforts to promote FTZ 40 and 181 as a unified multi-site global supply chain management program.


“In the true sense of regionalism, NEOTEC and the Port Authority have collaborated to strengthen the FTZ program in Northeast Ohio and open the door to renewed opportunities for business attraction and expansion projects,” said Ron DeBarr, president and CEO of NEOTEC. “This is a smart partnership for both of our organizations, and most importantly for the regional economy.”


David Gutheil, Vice President of Maritime and Logistics for the Port Authority, said that the partnership fulfills the Port Authority’s need to more aggressively market FTZ 40 and provide additional logistics options for companies. “NEOTEC’s track record in using the Foreign-Trade Zone program to develop global supply chain solutions for companies in this region is impressive,” Gutheil said. “Transferring the administration of FTZ 40 to NEOTEC will allow the Port Authority to focus on our core objectives—namely to foster economic development in our region through our maritime business, bond financing services, and lead role on critical infrastructure projects in Cleveland Harbor.”


NEOTEC is recognized nationally as a leader in foreign-trade zone development and management. FTZ 181 experienced significant growth under NEOTEC’s management during the last 15 years and is now one of the largest of 250 zones in the United States in total volume of merchandise received and shipped. In addition, NEOTEC is actively involved in legislative efforts relating to the program through DeBarr’s participation as secretary of the Board of Directors of the National Association of Foreign-Trade Zones (NAFTZ) in Washington, D.C.


Under the partnership agreement, the Port Authority will continue to serve as grantee of FTZ 40, while NEOTEC assumes the duties of Zone Administrator. DeBarr said that new marketing efforts will highlight the region’s broad network of FTZ sites as an opportunity for companies to grow and meet their global business needs. “We will use this combined FTZ ‘super zone’ as another business attraction tool to convince companies to locate in Northeast Ohio and significantly improve their bottom line through the FTZ program,” said DeBarr.


The Foreign-Trade Zone program was created in 1934 by Congress to facilitate international trade and enable U.S.-based companies to maintain cost competitiveness with their foreign-based competitors. Under FTZ procedures, foreign and domestic merchandise may be admitted into zones for operations such as storage, exhibition, assembly, manufacture and processing, without being subject to formal Customs and Border Protection (CBP) entry procedures, the payment of duties, or the payment of federal excise taxes. When merchandise is removed from a foreign-trade zone, duties may be eliminated if the goods are then exported from the United States. If the merchandise is formally entered into U.S. commerce, duties and excise taxes are due at the time of transfer from the FTZ. Zone status also provides companies with an opportunity to reduce certain operating costs associated with a U.S. location that are avoided when operating from a foreign site. Other FTZ savings benefits include entry consolidation and direct delivery; plus, inventory stored in an FTZ is not subject to import quotas.

Companies that can benefit from foreign-trade zone status include those that export products, import high-value products or products in high volume, are subject to import quotas, desire expedited delivery, or receive multiple shipments in a week. NEOTEC offers companies a free, confidential benefits analysis to determine if the FTZ program can be of value.

NEOTEC works to attract business investment in the region by promoting domestic and international trade, and strengthening the region’s distinct advantages as a business location. In addition to the Foreign-Trade Zone program, NEOTEC’s initiatives include the International Trade Assistance Center, which provides basic export counseling assistance and training to area companies; the Global Consulting Group, a team of international trade professionals offering in-depth “executive on loan” and one-on-one training services to companies ready to begin exporting; the Northeast Ohio Logistics Network, which works to improve market access in Northeast Ohio and promote the region’s logistics strengths; and the Global Business Development Initiative, a series of efforts to attract foreign direct investment to the region.


NEOTEC was founded in 1996 by county officials in Columbiana, Mahoning, Portage, Stark, Summit and Trumbull counties. Ashtabula County joined NEOTEC in 2002, followed by Medina County in 2005 and Richland County in 2006. NEOTEC is located on the campus of Kent State University, which partners with NEOTEC in its economic development efforts. For more information, visit the NEOTEC web site at

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