How Trade Adjustment Assistance works

Any manufacturing firm with U.S. headquarters is eligible to be approved for assistance by the Department of Commerce if it can show:

• a 5 percent decline in sales (dollar volume) for a current period (6 to 12 months), versus the same months for the prior year;
  
  
• a decline of 5 percent in employment for that same period; and
  
  
• that the decline is import-related.

There are three phases to the assistance process. First, a firm must get certified. Then an Adjustment Plan is developed, which recommends turnaround projects. The final phase is project implementation.

Once a firm is certified, SETAAC visits the company to look at its entire operation, ask questions and listen to management. From that point, the Adjustment Plan (AP) is prepared. The AP costs depend on firm size in sales dollar volume, but range from $3,000 to $12,000, with the TAAC picking up 75 percent of the total cost.

Once the AP is approved, the project implementation phase begins. Depending on the firm’s sales volume or size, up to $150,000 in funding is available on a 50/50 cost-share basis for turnaround projects that are outlined in the AP. (A mini-plan option is available in which project funds are capped at $30,000; SETAAC pays for 75 percent of the total project cost.)

Private consultants perform the adjustment plan project work. The firm has final consultant selection rights and signs all contracts. SETAAC cannot pay for assets, but can pay for things such as equipment training, installation and specialized software modules.

Last year, SETAAC provided technical assistance to more than 30 companies in an eight-state region that were experiencing increased import competition. On average, these companies received $42,000 in matching funds from the U.S. Department of Commerce to make improvements in production, marketing/sales, and information systems. In the past three years, SETAAC clients have seen sales increase by 26 percent and productivity improve by 28 percent.

There are 11 Trade Adjustment Assistance Centers around the country. Find the one nearest you at www.taacenters.org.