NOTEBOOK: Trade assistance program scarcely used by Iowa manufacturers
JOE GARDYASZ Aug 5, 2016 | 4:00 pm
2 min read time
525 wordsBusiness Record Insider, Manufacturing, The Insider NotebookIowa manufacturers that are losing business to overseas competition can get some help to level the playing field through a program that’s now administered by the Mid-America Trade Adjustment Assistance Center at the University of Missouri Extension in Independence, Mo. That center also administers the program for Missouri, Kansas and Nebraska.
Last week I wrote an item for our Business Record Daily about the program expanding to Iowa. I have since reached its director, Donna Porch, who provided some insight on the change and how the program works.
Iowa’s program had previously been administered by the Midwest Trade Adjustment Assistance Center in Chicago, but in a competitive shuffling of regions earlier this year the TAAC territories were realigned effective May 1, Porch said.
Just nine Iowa companies have qualified for the program’s funding in the past several years, which could be an indication that the state isn’t feeling much impact from trade imbalances, or maybe it’s a sign that not enough manufacturers in the state know about the program.
Tom Zimolzak, director of the Midwest TAAC that previously administered the program for Iowa, said that last year 48 other Iowa companies were in contact with the center for information or had unsuccessfully attempted to qualify for grants. On average, 1.3 Iowa firms qualified for a grant each year and 6.9 firms were pursuing grants, he said.
Mike Ralston, president of the Iowa Association of Business and Industry, told me he has never had an ABI member mention the program to him and wasn’t aware of it until he read the Business Record item.
To be eligible for the grant assistance program, a manufacturer must be able to prove it has experienced a decline in sales at least in part due to import competition. It’s up to the client to determine whether It will seek a $30,000 grant, which requires a 25 percent match from the company, or a $150,000 grant, which requires a 50 percent cost share. The assistance can be spread over up to five years.
The national program, which has been around since 1974, is currently funded at $13 million annually by the Department of Commerce and is split about equally among the 11 regional TACCs so each gets just over $1 million.
Although Iowa’s TAAC program is now based out of Columbia, Mo., it operates under a financial incentive system that encourages it to serve an equal number of companies in each of the four states it handles, Porch said.
Last year the TAAC program assisted five Iowa manufacturers, and over the past five years nine companies in Iowa qualified for $770,000 in grants, according to data from the Mid-America TAAC that formerly handled Iowa’s program. Those nine companies collectively employed 1,802 workers and had combined sales of more than $316 million.
That center, which prior to the reshuffling served Illinois, Iowa, Minnesota and Wisconsin, currently is assisting 142 active companies that cumulatively employ 10,013 workers with more than $2.3 billion in combined sales. Those firms increased employment by a combined 1,545 jobs and had an increase of more than $659 million in sales between the time they were certified and January 2016.
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