03-31476. Foreign-Trade Zone 119-Minneapolis, MN; Application for Subzone Expansion and Permanent Authority-Subzone 119B; Wirsbo Company Plant, Apple Valley, Minnesota (Polyethylene Tubing)

An application has been submitted to the Foreign-Trade Zones Board (the Board) by the Greater Metropolitan Area Foreign Trade Zone Commission (Minneapolis, Minnesota), grantee of FTZ 119, requesting authority to expand the boundary of Subzone 119B, at the Wirsbo Company plant in Apple Valley, Minnesota, and requesting that the authority for subzone status be extended on a permanent basis. The application was submitted pursuant to the provisions of the Foreign-Trade Zones Act, as amended (19 U.S.C. 81a-81u), and the regulations of the Board (15 CFR part 400). It was formally filed on December 12, 2003.

Subzone 119B was approved by the Board in 1993 with temporary authority granted for the manufacture of polyethylene tubing at Wirsbo's manufacturing plant (135,000 sq.ft./10.5 acres) in Apple Valley, Minnesota (Board Order 640, 58 FR 30143, 5-26-93). Activity at the facility (180 employees) includes product development, manufacturing, testing, warehousing, and distribution of cross-linked polyethylene (PEX) tubing for residential and commercial indoor/outdoor hydronic radiant heating systems. The plant produces up to 300 million feet of tubing under FTZ procedures annually.

The applicant is now requesting authority to expand the subzone boundaries to include an additional site located at 2300 West Highway 13, Burnsville (Dakota County), Minnesota, about nine miles northwest of the existing subzone site. The proposed Site 2 would include a 22-acre parcel containing a 413,000 square foot facility (125 employees) used for warehousing and distribution of production materials and finished tubing. The applicant also requests removal of the time restriction on FTZ manufacturing authority pursuant to Board Order 640, which authorized the manufacture of PEX tubing under FTZ procedures for an initial three-year period, subject to extension.

Foreign-sourced materials used in the manufacture of tubing (about 35 percent of total purchases) include: polyethylene (HDPE) resins (7.1% duty rate). The company also admits certain parts and materials used in constructing the radiant heating systems. Such warehouse distribution items include: thermostats, brass and copper fittings, aluminum pipe, polyethylene pipe, various polymers and resins in primary form, plastic foil, insulation, packaging materials, other articles of plastic and rubber, polyester tape, fittings, fasteners, mounting tracks, valves, transformers, fuses, relays, junction boxes, metal fittings, flow meters, regulators (duty rates: free—8.6%).

FTZ procedures exempt Wirsbo from Customs duty payments on the foreign resin used in export tubing production (1% of shipments). On its domestic shipments and exports to NAFTA markets, the company is able to choose the duty rate that applies to finished PEX tubing (3.1%) for the foreign-origin resin noted above. Duties would continue to be paid on the warehouse items entered from the subzone for U.S. distribution. The request indicates that the savings from FTZ procedures will continue to help improve the facilities' international competitiveness.

In accordance with the Board's regulations, a member of the FTZ Staff has been designated examiner to investigate the application and report to the Board.

Public comment on the application is invited from interested parties. Submissions (original and three copies) shall be addressed to the Board's Executive Secretary at the address below. The closing period for their receipt is February 20, 2004. Rebuttal comments in response to material submitted during the foregoing period may be submitted during the subsequent 15-day period (to March 8, 2004).

A copy of the application will be available for public inspection at the following location: Office of the Executive Secretary, Foreign-Trade Zones Board, Franklin Court Building—Room 4100W, U.S. Department of Commerce, 1099 14th Street, NW., Washington, DC 20005.

Dated: December 12, 2003.

Dennis Puccinelli,

Executive Secretary.