AUBURN – Economic developers expect to get a green light from Washington next month, and with it the chance to tap into a growing international market.

The federal board charged with granting approval for Foreign Trade Zones should issue its decision by early November on an application to create a zone in Auburn. A Foreign Trade Zone is legally considered outside U.S. Customs territory, allowing certain businesses to import and export goods without paying duties.

“We’re at Washington’s will,” said Benjamin Hayes, economic development specialist with the Lewiston-Auburn Economic Growth Council, which submitted the application. “But in the meantime, we’re actively marketing the potential (of the zone).”

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

Several local businesses are doing a cost/benefit analysis on the zone. Among them are Tambrands, which imports rayon from Germany for its tampons; L.L. Bean, which imports much of its apparel from overseas manufacturers; and Safe Handling, which imports certain chemicals and raw materials used in the pulp and paper-making process.

The Foreign Trade Zone designation allows a manufacturer to import raw materials from overseas without paying duty taxes. If the finished goods are then sold domestically, duty is paid at the time of sale – a deferral that enhances a company’s cash flow. If the goods are exported out of the United States, no duty is paid at all.

Distribution companies can also benefit from the zones because duties aren’t imposed on imported goods stored in an Foreign Trade Zone warehouse. But the cost to activate a company within a zone can run in the neighborhood of $50,000. Participating companies must pay for training in inventory control compliance, shipping, security and other issues related to international trade.

“Many business know about the FTZ now and are thinking about it,” said Hayes. No opposition to the zone was presented at the time of its public hearing in May, and no opposition was voiced during the public comment period that ended in June.

Other economic developers are also preparing for what they hope will be good news about the Free Trade Zone. The Auburn Business Development Corp. recently purchased 160 acres within the 750-acre zone for a new business park. Should Washington grant its approval, developers want to be able to offer space within the business park to any company that wants to build a distribution warehouse facility or a manufacturing plant, said Hayes. The area has also been granted Pine Tree Zone status, allowing for tax credits from the state government for eligible businesses.

“We’re layering as many business resources as we can,” said Hayes, adding that city development staff and the Maine International Trade Center have joined ABDC in the effort as well. “We’re looking at partnerships to make it ready for development, in terms of infrastructure, permitting and zoning.”

Paul Badeau, marketing director for the LAEGC, said the feedback he has gotten on the Foreign Trade Zone is positive.

“It only benefits us … the airport, the St. Lawrence-Atlantic railroad … a lot of businesses in that proximity,” he said. “It’s one more marketing tool for the Twin Cities.”