AUBURN – FTZ.

It means Foreign Trade Zone. And if it comes to Auburn it could also mean hundreds of thousands of dollars in savings to area businesses and greater job security for their employees.

On Tuesday some of Lewiston-Auburn’s biggest manufacturing powerhouses turned out to back a plan to create an FTZ around Auburn’s rail interchange off Lewiston Junction Road. That’s where tons of products are loaded or unloaded for manufacturers in central and western Maine.

If approved, the FTZ would mean those manufacturers who import raw materials from overseas, or who export finished goods to foreign markets, could save lots of money in duties and processing fees. Tambrands, Formed Fibre Technologies, Safe Handling and L.L. Bean representatives all spoke in support of the proposal.

“One of the handicaps of doing business in the state of Maine is transportation costs,” said Martin Eisenstein, counsel for L.L. Bean. An FTZ could “really level the playing field for L.L. Bean.”

Eisenstein said the company could see savings in duty deferrals, quota restrictions on apparel imports and delivery procedures. At Tambrands, the company could potentially save significantly on import costs of rayon from Germany and export fees to Canada and Mexico.

A study done by Lewiston Auburn Economic Growth Council said a business such as Formed Fibre Technologies, which exports components for manufacturing cars around the world, could save about $300,000 a year in export and import fees if the FTZ designation is approved.

The proposal is being reviewed by the federal Department of Commerce. Part of the application process requires a public comment session, which was held Tuesday in Auburn City Building. Kathleen Boyce, an examiner from the Department of Commerce, listened as businesspeople and government officials made their cases.

“The need for a Foreign Trade Zone status is evident,” said Lucien Gosselin, president of the Lewiston Auburn Economic Growth Council, which submitted the application. “Our economy has felt the direct result of foreign competition with significant job losses and company closures in textile and shoe industries.”

Gosselin said if approved, the designation could help with area job retention, job growth and private investment. The four companies whose representatives spoke in favor of the proposal employ about 2,000 people locally.

The application requests about 750 acres surrounding the intermodal facility and airport on Lewiston Junction Road be designated as a general purpose FTZ. If granted, individual businesses within 60 miles of the FTZ can request subzone status, which accords them trade privileges similar to a general purpose zone.

Safe Handling, a bulk transportation company that falls within the general purpose FTZ, is poised to capitalize on the designation if it occurs. Ford Reiche, president of Safe Handling, said the company is in negotiations with overseas suppliers of materials for papermaking. If the FTZ status is granted, Reiche could envision importing raw materials from Asia through Vancouver, which could then be transported to Auburn via the St. Lawrence and Atlantic rail system.

“Maine is geographically remote from the rest of the United States and suffers a transportation penalty,” he said. “An FTZ will help in a number of areas to improve our competitiveness.”

The public comment period on the proposal remains open until June 14.

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