Brice Wallace
Salt Lake Business Journal
A new organization is overseeing a federal program aimed at fostering business growth, with plans to expand it beyond the Salt Lake City area to include all of Utah.
Salt Lake City has transferred Foreign Trade Zone stewardship to World Trade Center Utah following a unanimous vote by the Salt Lake City Council and approval from the U.S. Department
of Commerce.
The FTZ is an economic development tool designed to help companies store, assemble or manufacture imported goods without immediately paying import duties. In some cases, those companies can avoid tariffs altogether. Customs duties and excise taxes are due only at the time of transfer from the FTZ for U.S. consumption. The overall aim is to help companies reduce costs and compete globally.
“It gives those businesses a lot more stability and opportunity, safety and security to operate their businesses here and work internationally by doing so,” Salt Lake City Mayor Erin Mendenhall said during a news conference marking the transition.
The FTZ in Salt Lake City was established in 1977 and was the vision of then-Mayor Ted Wilson. Mendenhall said the FTZ is “a very unique location that you won’t really see on a usual map in the state of Utah but that impacts our Utah-based economy in a big way.”
The local area, designated FTZ 30 and one of 300 nationwide, has 15 companies operating there or seeking federal approval to do so, a figure Mendenhall expects to grow. “The FTZ, what it does is it helps these companies stay competitive, especially in global markets as they continue to shift and change,” she said.
The FTZ covers most of the Wasatch Front, north to Box Elder County and south to southern Utah County. “But this will go statewide,” vowed Jonathan Freeman, president and CEO of WTC Utah. “We are determined. It might take some time, but we will make sure it is available to all Utah businesses.”
“This is really a natural step forward in our strong economy,” Mendenhall said of handing over FTZ authority to WTC Utah. “It’s a good expansion of Ted Wilson’s legacy, as well. It reflects our shared belief that the Foreign Trade Zone can, and really should, recruit more businesses. It should effectively reach more businesses across the state of Utah, not just here along the
Wasatch Front.”
Freedman said Salt Lake City has been “a phenomenally powerful steward” of the FTZ. “We are proud to take on this role, and we’re building directly on what the city has established,” he said.
“This is welcome news, right now especially. This is a unique solution in a time of uncertainty for businesses,” he added, describing it as a way to help companies “navigate through these treacherous waters.”
WTC Utah has invested in the FTZ the past few months, can help companies walk through the process of qualifying and provide a free cost/
benefit analysis.
Currently, Utah businesses collectively pay hundreds of millions to the federal government in duties and taxes. “And our objective is to keep as much of that capital here locally to fuel the growth of our businesses here, to support our entrepreneurs, to fuel job growth and economic prosperity here in Utah,” Freedman said.
“Stability is money,” Mendenhall said. “And there’s been a great deal of instability in international markets, for varying reasons in this climate, and this is a very well-established stability tool that now will have an even broader reach in the state of Utah because of the World Trade Center’s relationships and jurisdiction, so to speak, which is a great part of Salt Lake City’s interest in transferring this grantee ownership to them.”
Jefferson Moss, executive director of the Governor’s Office of Economic Opportunity, said the transfer is “not just an administrative change, some paperwork that’s being changed.” Freedman and his team are “incredible ambassadors” for the Utah business community and are a resource to help businesses wanting to expand outside Utah or come into the state, he said. “Having this as a tool is going to be very important,” Moss said.
The pace of change is quickening, he added. “As we’re getting into AI, all these things that are happening in the economy, having a nimble framework, having this team, this public/private partnership, I think it’s going to continue to make sure that Utah is an innovation hub and that we can be a leader in this space,” Moss said.
Victoria Petro, a member of the Salt Lake City Council, said the FTZ transfer “makes sense” because it removes barriers for businesses. The city legislates for the future, she said, “not to respond to a tempest that is here now but to make sure that we are unflappable in the face of whatever comes to us.”