Company looks to set up foreign-trade subzone deal with Mesa

An electronics supply chain company is hoping to enter into an agreement with Mesa to operate in a foreign-trade subzone at three locations.

The Mesa City Council will take up the request during its Monday meeting. The item is on the consent agenda in which all matters are approved with one motion and vote.

Arrow Global Supply Chain Services Inc. is hoping to get an operator agreement with the city for a foreign-trade subzone at 7449 E. Pecos Road, 7453 E. Pecos Road and 7250 S. Sossaman Road.

As a subzone within Mesa’s Foreign Trade Zone, the company can take advantage of deferred, reduced or even eliminated import-export duties on foreign materials and components used for manufacturing and assembling.

“Without an FTZ, companies may pay customs duties multiple times as products move through different stages of manufacturing and distribution,” a staff report stated. “The FTZ program helps simplify that process and prevents unnecessary expense on imported components used in U.S.-based production and manufacturing.”

In April, Arrow Global Supply Chain Services received FTZ site status approval from the U.S. Department of Commerce Foreign-Trade Zones Board. The operator agreement with Mesa is the next step toward FTZ site activation.

Arrow Global Supply Chain Services, a wholly owned subsidiary of Arrow Electronics, provides services to customers around the world, according to a staff report.

“Their warehouse logistics center along Pecos and Sossaman Roads is a key part of Arrow’s global supply chain infrastructure, enabling faster, more resilient distribution for its electronics supply chain clients,” the report continued.

Operations at the three sites will include importing, exporting, receiving, repackaging, quality control inspections and distribution.

“At this time, no production activity is proposed or anticipated,” the report stated.

Companies operating within an FTZ must still pay local property taxes, utility costs, development fees and other taxes and obligations.

Under the proposed agreement, Arrow Global Supply Chain Services will pay the city a one-time activation fee of $1,000, as well as an annual operator fee of $5,000.

The Mesa FTZ originated at the Mesa Gateway Airport but was reorganized to include the entire city.

The Mesa City Council meeting starts at 5:45 p.m., July 20 at council chambers in city hall, 20 E. Main St.

Janet Perez can be reached at jperez@iniusa.org. Please send your comments about this article to AzOpinions@iniusa.org. We are committed to publishing a wide variety of reader opinions, as long as they meet our Civility Guidelines.