02-17143. Elk Rapids Engineering, a Division of Star Cutter Company, Elk Rapids, MI; Notice of Negative Determination Regarding Application for Reconsideration

By application dated May 16, 2002, a petitioner requested administrative reconsideration of the Department's negative determination regarding eligibility to apply for Trade Adjustment Assistance (TAA), applicable to workers and former workers of the subject firm. The denial notice was signed on May 7, 2002, and published in the Federal Register on May 17, 2002 (67 FR 35140).

Pursuant to 29 CFR 90.18(c) reconsideration may be granted under the following circumstances:

(1) If it appears on the basis of facts not previously considered that the determination complained of was erroneous;

(2) If it appears that the determination complained of was based on a mistake in the determination of facts not previously considered; or

(3) If in the opinion of the Certifying Officer, a mis-interpretation of facts or of the law justified reconsideration of the decision.

The petition for the workers of Elk Rapids Engineering, Elk Rapids, Michigan was denied because the “contributed importantly” group eligibility requirement of section 222(3) of the Trade Act of 1974, as amended, was not met. The “contributed importantly” test is generally demonstrated through a survey of customers of the workers' firm. The survey revealed that none of the respondents increased their purchases of imported CNC controlled machine tools while decreasing their purchases from the subject firm. The subject firm did not import CNC controlled machine tools.

The petitioner believes that their company as well as the entire machine tool industry in the United States has been significantly affected by increased imports of machine tools. The petitioner attempts to support this claim by providing a transcript of testimony given by the Association for Manufacturing Technology before the Committee on Small Business, U.S. House of Representatives on April 24, 2002. The petitioner also indicates that customers are spending less and importing more machine tools during the relevant period. The petitioner further attached a summary of U.S. Machine-Tool Orders depicting significant declines in orders during the last few years.

A review of the data supplied by the petitioner depicts industry wide data that is not specific to the products produced at the subject plant. The Department of Labor examines the direct impact of imports that are “like or directly competitive” with what the subject plant produced and if imports “contributed importantly” to the layoffs at the subject plant. The investigation revealed that imports of the product produced at the subject plant did not “contribute importantly” to the layoffs at the subject plant. The U.S. Machine-Tool Order data supplied by the petitioner depicts declines in U.S. machine-tool orders during the last few years. U.S. machine tool orders include those for the export market, as well as the domestic market. Thus a reduced demand for U.S. machine tools (depicted by orders) does not reflect a definitive increase in imports. Examination of industry data in which the subject firm's products are categorized shows that U.S. imports of products like or directly competitive with what the subject firm produced declined in 2001 over 2000.

Conclusion

After review of the application and investigative findings, I conclude that there has been no error or misinterpretation of the law or of the facts which would justify reconsideration of the Department of Labor's prior decision. Accordingly, the application is denied.

Signed at Washington, DC, this 20th day of June, 2002.

Edward A. Tomchick,

Director, Division of Trade Adjustment Assistance.