Foreign Trade Zones: what they are and how they benefit your busines

 

In the heart of the Great Depression, the American government wanted to kickstart economic development. One way they did so was with the 1934 Foreign Trade Zone (FTZ) program, which is still being utilized today as a tool for American businesses to compete in a global market.

A flyer talking about a foregin trade zone with ships in the foreground over a blue background.
The first FTZ was in Staten Island.

There are currently around 230 FTZs and 400 subzones within the United States. The Port of Montana, located within the Montana Connections Business Development Park, is Foreign Trade Zone #274.  

What is a Foreign Trade Zone?

In layman’s terms, an FTZ is a secure site located within the United States physically, but outside of U.S. customs territory. Each zone falls under the supervision of U.S. Customs and Border Protection.

When an item is imported into the U.S., if it’s being stored anywhere outside of an FTZ, the company immediately has to assess and subsequently pay its duties on that product.

A product imported directly into a FTZ will not have duties assessed until after the product leaves the Zone. (An FTZ does allow exemptions of export duties if your product never leaves the zone and is immediately re-exported).

The benefits of a Foreign Trade Zone:  

There is a multitude of benefits when you import your products directly into an FTZ, benefits that can largely depend on the type of business you have.

 

A diagram depicting the benefits of operating in a foreign trade zone.
The benefits of operating in a FTZ.

 

While the be perks of an FTZ are nearly endless, we’ve listed here a few universal advantages of utilizing FTZs:

Maximizing cash flow  

Duties and taxes are not paid until merchandise leaves the FTZ . This duty deferral, or sometimes even avoidance, can result in major cash savings. Additionally, while in the zone, certain tangible personal property is generally exempt from state and local ad valorem taxes.

A picture of a railroad area in Butte, MT, with Port of Montana and a logo at the top.
The Port of Montana, in Butte, MT.

As the Port of Montana allows you to store your goods for an indefinite amount of time—you can wait for the best price within the U.S. market, which also maximizes your cash flow. During this time, your goods are guaranteed to be safe and secure, as CBP security requirements provide protection against theft.

Bypassing quota restrictions

Goods that are under quota restrictions, and thus not allowed entry into the U.S., may be stored in an FTZ until the quotas are lifted and the product can be once again brought into U.S. markets.

In certain cases, a quota-restricted product can be modified within an FTZ to a product that is not subject to quota limits and thus would be okayed to be released into the market.

Streamlining bureaucracy

 

U.S. Customs often examines goods being imported into the border, which can cause long delays. When importing straight into an FTZ, this process will be expedited and often skipped all together. In addition, FTZs minimize the amount of paperwork and frequency of submittals of paperwork to U.S. Customs. This increases efficiency and lowers costs.

Having better control

 

Your company can run from a single distribution center, delivering your goods across the world without facing huge import and export duties you’d be subjected to outside an FTZ.  Because your inventory is kept in one facility, you can  keep an eye on your goods and better control your distribution.

A globe surrounded by different icons showing the benefits of operating in an FTZ.
An overview of benefits of operating in an FTZ.

The FTZ program has helped thousands of businesses across the U.S. compete in a global market. As of 2015, the value of merchandise handled by FTZs exceeded $640 billion and only continues to increase.

Learn additional benefits of an FTZ for your company by contacting us today. We’re always available and excited to help.  

 

Transportation Hub: Butte Montana

The Montana Connections Business Development Park is the only location within Montana where two highways intersect. Nestled at the intersection of Interstate Highways 15 and 90, we are the best place for good distribution anywhere in the Rocky Mountain West.

A map of montana highways and cities, with Butte circled for emphasis.
Map of Montana Highway System

Clients like FedEx Freight and Old Dominion Freight have thrived in our industrial park, in part, because of this connectivity. While the benefits of being so close to two major interstate highways are nearly endless; we have compiled five major advantages you may not have thought of:

A group of signs showing where businesses are in an industrial park.
Companies currently at the MCBDP

Access to all of North America

Major market centers are a straight shot on the two freeway corridors that stretch north, south, east and west. Reach prime industry and manufacturing cities, including Calgary, Salt Lake City, Spokane, Seattle, Las Vegas, San Diego and Minneapolis with ease.

Desirable destinations are only a day away

Interstate Highways 15 and 90 allow you to get where you need to go fast. Interstate 90 is the longest Interstate Highway in the United States, running east-to-west and Interstate 15 runs north-to-south. As we said, desirable locations — including international ports — are on the direct route from our location in Butte, Montana. This direct route increases your ability to get exactly where you need to go in a reasonable amount of time.

A simple map of the US showing I 90 running across.
A map of Interstate 90

Greater predictability for planning

Major American interstates were carefully designed and constructed to allow for reliability. The Interstate System is a streamlined system that did away with infrastructure that caused delays and added infrastructure (passing lanes) to increase traffic flow. With access to not one, but two, major interstates, companies can better plan the logistics of their hauls, knowing with a greater surety exactly when their products will arrive where they need to be. At the same time, this reliability allows companies to successfully avoid delays, caused by traffic, construction and even weather.

A blue diagram with a truck, a train, and an airplane on it.
Ground an air transportation options.

Uniformity of regulations

With major market centers a straight shot in either direction, businesses don’t have to worry about meeting the weight, size and height restrictions of smaller highways. Interstates have a greater uniformity of regulations. While states determine laws and regulations for portions of the National Highway System that are not a part of the Interstate System, the Interstate System is controlled primarily by the national government. Set your mind at ease by knowing that whichever direction you’re heading in, you won’t have to worry about state-specific restrictions.

An image showing the regulatory costs per manufacturing employee annually.
Regulatory Compliance Costs in 2014 dollars (according to NAM).

Easy transfer of goods from truck-to-rail or rail-to-truck

We are the only place in Montana where two Class I railroads are located. Access to both the Union Pacific and the Burlington Northern Sante Fe Railroads allows for easy distribution both east-west and north-south. The Port of Montana is located within the boundary of our industrial park and assists companies with transfer between truck-to-rail, rail-to-truck, and truck-to-truck, so the world is truly at your fingertips.


Montana Connections Business Development Park boasts numerous benefits to help your business to thrive, including a transportation and distribution service that cannot be beaten.

So what are you waiting for? Join our family and take your business to a higher level.

Expand Your Reach with Montana Connections Business Development Park

What is Montana Connections Business Development Park and how it can help your business thrive:

An old mining rig over looks the town of Butte, MT.

Finding the prime location to grow your business is difficult. At Montana Connections Business Development Park we’re here to not only make it easier, but to help your business thrive.

Montana Connections Development Park is an industrial park just outside Butte, Montana that offers multiple incentives for new and existing industrial ventures looking for a place to begin or relocate. As we are driven by job development and economic diversification — not profit — we are completely focused on you and your venture, offering outstanding services in four main categories.

Transportation and distribution:  

A black train car that says butte anaconda and pacific on it.
An old train car rests in Butte, MT.

Nestled at the intersection of major interstates I-15 and I-90, along both the Union Pacific and Burlington Northern Santa Fe Railroads, the park is perfectly located for manufacturing expansion and development, and is the best place for good distribution  anywhere in the Rocky Mountain West.

The Port of Montana, a full service transload, warehouse and distribution facility, is located within our boundaries and allows our clients to access both the long-haul rail service and over-the-road shipping — all at an affordable price.

A picture of a railroad area in Butte, MT, with Port of Montana and a logo at the top.
Butte, the port of Montana.

In fact, we’re the only location within Montana where two highways intersect and where two Class I railroads are located. This allows for easy distribution of your goods — from automobiles to agricultural products — in every direction, including to major market centers in Salt Lake City, Las Vegas, San Diego and beyond.

But don’t stop in North America; reach the entire world through efficient delivery to international ports.

Financial Incentives:  

The Port of Montana has been designated a Foreign Trade Zone (FTZ), which allows for American businesses to better compete in a foreign market by designating areas to be considered outside of U.S. customs territory. That means a product imported directly into a FTZ will not have duties assessed.

A globe icon with lines connecting different countries to Butte, MT.
Butte is the international gateway to Montana.

As a designated FTZ, we offer numerous benefits to companies, from improved cash flow to increased efficiency. As the only FTZ General Purpose Warehouse within a five state radius, we’re the best place in the Rocky Mountain West to expand your company.  

Infrastructure:

We have all the available infrastructure your business will need, from industrial water (4 million gallons a day available), wastewater, gas, electrical and roads. We also offer state-of-the-art telecommunications services, including high-speed fiber optic communications products and services.

A Supportive Community:

When you do business with us you become apart of a community that’s already home to prosperous companies: FedEx, Montana Precision Products, SeaCast, REC Silicon, Scoular Grain and Old Dominion among others.

Old minding rig stands over a crowd gathered for a concert.
The community gathered at one of Montana’s most popular festivals in Butte.

Moreover, the Butte Silver-Bow local government is focused on economic development, job creation and business expansion. As the liaison between the government and your business we guarantee that all available incentives for development will be explored, including the possibility of financial assistance.

At the Montana Connections Business Development Park we truly are here to help your business thrive. If you’re ready to expand your reach contact us and we’ll be happy to welcome you to the family.

12 Reasons Butte is Good for Business

As we’ve discussed on this blog before, Butte is a place of history and character, hence the nickname Butte, America. Nevertheless, history and character don’t put food on the table.  In addition to being a great place to live, Butte is a great place to locate your business.  How is that, you ask?  

We can think of 12 reasons how, which we’ve listed here.  

  • Location – Situated at the intersection of Interstate Highways 15 and 90, and along both the Union Pacific and Burlington Northern Santa Fe Railroads, we are the best placed location for manufacturing expansion and development, and also the best placed location for distribution anywhere in the Rocky Mountain West.  
  • Infrastructure – Butte’s rich history of both light and heavy industry has resulted in well developed infrastructure and capacity.  The Bert Mooney Airport offers daily flights to regional hubs, just a few minutes’ drive from uptown.  There’s ready access to water, sanitation, gas and electric utilities, high speed fiber, as well as the highway and railroads listed above.  In addition, local crane and heavy hauling services, equipment rentals and dealerships make doing business in Butte more convenient and affordable.
  • Reduced Import/Export Costs – The Port of Montana services rail cars and trucks, with a 86,000 pound lift capacity and both indoor and outdoor storage.  The Port of Montana and Montana Connections are located in a designated Foreign Trade Zone, which eliminates costs on import and export duties (explained in greater detail in each entities’ linked pages).  
  • A Talented Workforce – Butte is home to businesses spanning sectors including high-tech manufacturing, healthcare/life sciences, information technologies, energy utilities and geophysical consulting, which combine to generate and attract a talented workforce.  
  • An Outstanding University –  Montana Tech of the University of Montana has earned such accolades as the fourth best value in higher education nationwide and the fourth best public university in the west by the Princeton Review, and the ninth best public university for return on investment nationwide by the Wall Street Journal.  With degrees ranging from earth and health sciences, and in 12 engineering fields, Montana Tech keeps the workforce talent pool fresh and deep.
  • An Outstanding Technical/Trade School – Montana Tech offers certificates and Associate’s Degrees in fields including Aerospace Welding Technology, Machining Technology and Metals Fabrication, ensuring that Butte’s manufacturing base is staffed and state-of-the-art.
  • Low Home Prices -As of this writing, Realtor.com reports the median listing price of homes in Butte is $119k, compared to Missoula’s $315k and Bozeman’s $385k. Butte is an inexpensive place to be a homeowner, plain and simple.
  • Access to Outdoor Recreation –  Surrounding Butte are 3.2 million acres of National Forest, with ample opportunity for mountain biking, rock climbing, dirt biking, hunting and fishing.  There are 7 alpine ski areas within 3 hours of Butte, and Moulton Reservoir hosts nordic ski trails, operated by the Mile High Nordic Ski Club.  Three golf courses serve the area, including the Jack Nicklaus-designed Old Works Golf Course in nearby Anaconda.
  • Work Ethic –  During its peak production years, Butte’s mining industry supplied copper to electrify the nation, supply the World War I buildup and establish telegraph connections with the rest of the world.  Around the clock, thousands of people toiled underground in Butte’s mines, instilling an unwavering work ethic that persists to this day.
  • Great Food –  Keeping the old world, neighborhood grocery store alive, the Front Street Market operates a full service deli, offers a full wine selection, and has something for the gourmet in all of us.  The M&M Bar and Cafe first opened in 1890, and has enough neon and polished stainless steel to satisfy the diner enthusiast in all of us.  They make a great burger, too.
The M&M Bar and Cafe | Source: Flickr
  • Summertime Festivals –  The Montana Folk Festival is one of the Northwest’s largest music festivals, hosting more than 20 acts, with food vendors and artists’ booths scattered throughout uptown.  Even better, attendance is free of charge.  For the more adventurous, Evel Knievel Days bills itself as ‘the only extreme sports festival of its kind in the world,’ a claim that can’t be refuted.  It’s three days of stunts, spectacles and generally following Butte native Evel Knievel’s risk-taking example.
  • Strong Cultural Heritage –  Butte is steeped in its Irish heritage, which it celebrates any chance it can.  St Patrick’s day in Butte is a regional draw of revelry in the streets, which, without any open container law can get quite spirited.  The An Rí Rá Montana Irish Festival celebrates Butte’s Irish heritage, and is regarded as one of the best Irish festivals in the country.

We’ve listed 12 reasons Butte is good for business, but there might as well be a million.  The point is, it’s a great place to live, work and play.  After all, that’s what doing business is for, at least in Butte, America it is.

Why do they call it Butte, America?

Welcome to Butte, America.

Sure, Butte is located in the state of Montana, but its civic identity is best described as Butte, America.  I mean that in the most literal sense: the moniker shows up on license plates, in advertising and is the preferred place name for locals.   While the rest of the state brands itself with the usual themes of national parks, Hollywood movies and the Big Sky Country, there sits the contrarian stalwart, Butte, America.

It’s uncertain where Butte’s abbreviated name originated, but it’s been in use since the 1980’s, if not earlier.  In his book, Butte Trivia, George Everett, writes “the phrase was conceived by college students in Missoula as an insult and embraced by Butte residents as an apt description of their locale.”

Butte residents, for their part, tended to be immigrants still adopting, and adjusting to, their new American identity. In the words of historian David Emmons, “People in Butte never thought of themselves as Montanans. They identified first with Butte and then with places overseas—the countries they came from or other places where copper was mined.

So the name was either an insult or a point of pride, or maybe a little of both.

Considering that flipping insults into compliments characterizes the city’s defiant survival instinct, the name becomes more apt. In its heyday, thousands of miners worked up to a mile underground at a given time, around the clock.  Below is a computerized rendering of Butte’s underground mines showing the extent of the tunnels.  Amazing, huh?

Virtual map of Butte’s mines and tunnels | source: pitwatch.org

 

Even more amazing when you consider the personnel elevators could only carry so many people to the surface at a time.  This bottleneck was no more apparent than during the Granite Mountain mine disaster of 1917, which exacted the largest death toll in U.S. hard rock mining history.  When a lantern started a fire a half-mile underground, most of the 168 fatalities succumbed to asphyxia before they could escape to the surface.

All those man hours of underground toil and sacrifice weren’t for nothing, however.  Producing copper ore, the mines of Butte, America literally connected America to itself and the rest of the world.  During the nationwide buildout of electricity and telecommunications, Butte mining produced up to 20% of all domestic copper.

In more recent times, that same bareknuckle determination reincarnated itself in Butte’s native son, the daredevil Evel Knievel, who racked up 433 bone fractures from his record-breaking motorcycle jumps.  In true Butte form, after Knievel’s jumps he made speeches to his audience -frequently injured and bleeding profusely, just before being whisked to the hospital in an ambulance.  When his doctors were warning him that he might not walk again, Knievel was plotting his next spectacular stunt, done while festooned in his signature red, white and blue jumpsuit.

source: evelknievel.com

 

source: nydailynews.com
source: evelknievel.com

 

If that’s not Butte, America, I don’t know what is.

Among Montana’s cities, Butte marches to its own drum, and if you spend enough time here you’ll see what I’m talking about:  Built on a hillside, locals use the term ‘uptown’ to the office district most cities would consider downtown.  Instead of offering the usual fare like Pizza and burritos, restaurants advertise pasties and breaded pork chop sandwiches.  Even the language is localized, with colloquial speech including the plural ‘you’ pronounced “you’s.” It’s a relic of the American melting pot of days past, in constant reinvention on its own terms.

Caption: The Cornish Pasty, a Butte staple food | source: danvfood.files.wordpress.com