What's Coming Through Rickenbacker's Multibillion-Dollar Zone?

Late last year, the Columbus Regional Airport Authority announced that $10.4 billion in goods passed through Foreign Trade Zone 138 in 2018. The Rickenbacker-based zone, which covers 25 counties in Central Ohio and the surrounding region, now ranks seventh of 195 in the nation, up from ninth in 2017. So what exactly is being brought here, or heading to other countries? For that matter, what in the wide world of bureaucracy is a foreign trade zone?

The zones were established through New Deal legislation in 1934, and Zone 138 began operation in 1987, says Angela Atwood, the airport authority’s FTZ program manager. Inside Zone 138, the 18 active sites, operated by 16 companies, are considered outside U.S. Customs territory, so imported goods don’t require duty payment upon entry. Those taxes are deferred until the goods leave the company’s facility to enter the U.S. marketplace, and in some cases they can be reduced or eliminated altogether.

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For example, companies can import items to an FTZ distribution center and then re-export some for delivery to Canadian customers. The northbound goods would never incur duties here, and given Columbus’ location, a local warehouse could serve 50 percent of the U.S. and 30 percent of Canada, saving additional money by only having one facility. The U.S. forgoes that duty revenue, but the program encourages businesses to operate in FTZs. That investment and associated job creation is the goal of foreign trade zones, Atwood says.

Here’s a closer look at what’s happening in FTZ 138:

• The top countries exporting goods to FTZ 138 are Sri Lanka, China and Vietnam.
• The value of goods has grown by 33 percent since 2015:
• 2018: $10.4 billion
• 2017: $9.3 billion
• 2016: $8.9 billion
• 2015: $7.8 billion
• In 2018, 73.6 percent of merchandise moving through the zone was textiles or footwear, like boots from Rocky Brands, headquartered in Nelsonville.
• Horses flow from FTZ 138 to the Middle East. There have been more than 500 equine exports total since 2015, according to Columbus CEO.
• Among the most expensive—and fastest—consumer goods to pass through FTZ 138: a Swedish Koenigsegg Agera supercar, on its way to Dubai
• Zone 138’s only manufacturing site is International Converter in Noble County, which fuses ultrathin aluminum to packaging paper for the likes of Pringles cans and Arby’s wrappers.

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