November 16, 2010

FTZ Board Grantee Update - ASF Adjustments

This e-mail update to grantees announces the FTZ Board's approval yesterday of several adjustments to the Alternative Site Framework (ASF). The ASF was adopted by the Board in late 2008 as an option for the establishment or reorganization of general-purpose zones. In August 2010, after more than a year of experience with grantees developing and submitting actual ASF applications, the FTZ Staff published for comment two proposed adjustments designed to further facilitate use of the ASF.

Based on comments received (primarily from grantees) in response to the proposed adjustments published in August, the FTZ Board has now approved several adjustments to its ASF practice. Note that any modifications to application formats or other documents on the Board's web site as a result of the ASF adjustments should take place over the next few weeks.

The approved adjustments to the ASF are:

1) Eliminate the site-specific allotment of a given grantee's 2,000-acre activation limit (including for FTZs already reorganized or with applications pending for reorganization under the ASF). For those zones that have reorganized under the ASF or that have applications pending, no request or modification is needed, the site-specific activation limits will simply be removed. The site-specific allotment will be replaced with a procedure - once the Online FTZ Information System (OFIS) currently under development is available and appropriate training has been provided to grantees - whereby the grantees use the OFIS online system to update information on each site's activated space. [Current projections are that the portion of the OFIS system specific to FTZ sites should be online around the end of this year.]

2) For ASF applications, allow two general options for documentation pertaining to jurisdictions (ordinarily counties) within the service area:

a) Submitting letters from appropriate county officials acknowledging the proposed inclusion of their counties in the service area of the zone, and presenting their views on the proposal; or,

b) In the absence of letters from appropriate county officials, submission of evidence that appropriate officials of the affected counties were notified of the proposal and were provided information on how they could submit comments to the FTZ Board regarding the proposal. For this option, a grantee should be required to use standard language provided by the FTZ Board staff, thereby ensuring that clear explanation and instructions were given to appropriate officials of the affected counties.

In the absence of governments at the county level, the publication of local public notice regarding the application should allow a full range of appropriate local public officials to be informed of the application and to submit comments if they wish to do so. However, if a grantee will be relying on the publication of local public notice due to an absence of governments at the county level, the grantee should explain that situation within the body of the "application letter" signed by an authorized grantee official.

3) In response to a comment received, the FTZ Board has also adopted a recommendation to clarify that a site can be designated as Usage-Driven so long at the site falls within the grantee's service area (i.e., meets the standard general-purpose FTZ adjacency requirement), has appropriate zoning (i.e., can accommodate the types of uses ordinarily associated with general-purpose FTZ activity) and is tied to a single operator's or user's use.

The complete FTZ Staff report on the ASF adjustments - which addresses all comments received in response to the notice published in August - is on our web site at:

If you have any questions, do not hesitate to contact your regional representative on the FTZ Board staff. The list of staff contacts by region is in the "Contact Us" section of our web site - the direct link to that list is:

Andrew McGilvray
Executive Secretary and Staff Director
U.S. Foreign-Trade Zones Board
(202) 482-2862