St. Louis city, county seek foreign trade status

Tuesday, October 5, 2010 | 5:33 p.m. CDT

ST. LOUIS — The city of St. Louis is teaming with St. Louis County in a quest to have their turfs declared a foreign trade zone, partly hoping to lure international air cargo also coveted by a struggling Illinois airport nearby.

St. Louis Mayor Francis Slay and St. Louis County Executive Charlie Dooley asked the U.S. government in writing Monday for the duty-free designation they say could attract business to the area, notably if St. Louis' Lambert Airport becomes an air cargo hub with China. KTVI-TV says a Chinese delegation is to take a look at Lambert later this month.

If granted, the St. Louis Post-Dispatch reports the designation would mean that any business in the city or county would be able to receive, store, assemble and re-export products without paying federal customs duties.

Scott Taylor, an attorney consulting on the project, told the Post-Dispatch that could reduce costs by several percentage points, depending on the industry and type of business.

"The Foreign Trade Zone is an important step in leveling the economic playing field," Slay said.

The program, available since the 1930s, generally has been applied only to specific zones around ports and airports, as well as to manufacturers who seek the status on their own. But the Commerce Department last year allowed for broader footprints that so far have gotten 13 zones the designation while an additional 20 — Chicago and Indianapolis among them — have applications pending.

Taylor said a decision on the St. Louis region's request should be decided within six to eight months.

The jockeying for foreign air cargo has intensified in the St. Louis area in recent months, with Lambert Airport competing with MidAmerica St. Louis Airport — in southwestern Illinois, about 25 miles east of St. Louis — in chasing such business.

MidAmerica, which hasn't turned a profit since it opened with great fanfare 12 years ago, in August welcomed a test flight run from Shanghai to its runway, with the airport's administrators hoping regular service will start by the end of the year.

MidAmerica was named a U.S. port of entry in 2006, and its overseers have made pitches for overseas cargo for years. They have said they believe Lambert is late to the game in what is emerging as a turf war between two airports striving to siphon business away from other Midwest hubs.

MidAmerica has struggled since opening in 1998 and lost its last passenger service a decade later, raising nagging questions about its usefulness. Critics have persistently labeled it a $330 million boondoggle. Officials have had to work hard to lure and keep cargo business at a $7 million, 50,000-square-foot cargo terminal that opened in October 2005.

Yet the airport's supporters point to promising signs, including Chicago-based Boeing Co.'s recent announcement that it plans to lease the cargo terminal as a place to work on components for its defense programs. Boeing is expected to start work there late this year or in early 2011.

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