Fiscal Year 2012 Annual Report to Congress on the Trade Adjustment Assistance for Firms Program, 77217-77246 [2012-31377]

Download as PDF Vol. 77 Monday, No. 250 December 31, 2012 Part III Department of Commerce srobinson on DSK4SPTVN1PROD with Economic Development Administration Fiscal Year 2012 Annual Report to Congress on the Trade Adjustment Assistance for Firms Program; Notice VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\31DEN2.SGM 31DEN2 77218 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices Adjustment Assistance for Firms program. Notice . DEPARTMENT OF COMMERCE ACTION: Economic Development Administration Pursuant to 255A of chapter 3 of title II of the Trade Act of 1974, as amended (19 U.S.C. 2341 et seq.), the Economic Development Administration (EDA) publishes the Fiscal Year 2012 Annual Report to Congress on the Trade Fiscal Year 2012 Annual Report to Congress on the Trade Adjustment Assistance for Firms Program Economic Development Administration, Department of Commerce. srobinson on DSK4SPTVN1PROD with AGENCY: VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4703 BILLING CODE 3510–WH–P E:\FR\FM\31DEN2.SGM 31DEN2 VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4725 E:\FR\FM\31DEN2.SGM 31DEN2 77219 EN31DE12.005</MATH> srobinson on DSK4SPTVN1PROD with Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices 77220 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices Key Findings srobinson on DSK4SPTVN1PROD with In September 2012, the U.S. Government Accountability Office (GAO) reported to Congress that the effect of participation by importimpacted U.S. firms in the Trade Adjustment Assistance for Firms (TAAF) program was an increase in firm sales ranging from 5 to 6 percent on average,’’ and that ‘‘the effect of the program on productivity was about a 4 percent increase.’’ 1 GAO also noted in the report that manufacturing firms, specifically, associate the TAAF program with increased sales and productivity. Meanwhile, this report—EDA’s Annual Report to Congress on the TAAF program—finds that, two years after completing the program in FY 2010, participating firms experienced an average employment increase of 13.2 percent, an average sales increase of 26.8 percent, and an average productivity increase of 11.9 percent. For the sake of comparing TAAFassisted firms to non-assisted similar firms, the Department of Labor’s Bureau of Labor Statistics (BLS) reported that, in FY 2012, the manufacturing industry as a whole experienced an average employment increase of only 3.5 percent and an average productivity increase of 4.1 percent from FY 2010.2. Therefore, both GAO and EDA find that the TAAF program has a significant positive impact in helping importimpacted U.S. firms compete in the global marketplace. Additionally, all firms that completed the TAAF program in FY 2010 were in operation at the end of FY 2012, indicating strong survival rates for TAAF-assisted firms. Furthermore, on May 11, 2012, the Department of Commerce Office of Inspector General (OIG) presented EDA with a copy of their letter to the House and Senate Committees on Appropriations reporting their findings related to an examination of the TAAC administrative costs.3 As part of their review, OIG obtained expenditure data from a sample of three TAACs— Western, New England, and New York State—focusing on the use of Federal funds provided by EDA. The OIG reported that it ‘‘did not determine that 1 U.S. Government Accountability Office (GAO), Trade Adjustment Assistance: Commerce Program Has Helped Manufacturing and Services Firms, but Measures, Data, and Funding Formula Could Improve (GAO–12–930), September 13, 2012. 2 BLS does not collect a sales measure comparable to EDA’s measure in this report (i.e. average sales per employee). 3 The information was requested in the House Committee Report that accompanied the FY 2012 Commerce, Justice, Science, and Related Agencies Appropriations bill. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 the level of administrative costs of the three TAACs to be unreasonable.’’ Therefore, not only does the TAAF program produce results—it does so at reasonable costs. Background This annual report is submitted in accordance with Section 255A of chapter 3 of title II of the Trade Act of 1974, as amended (19 U.S.C. 2341 et seq.) (commonly referred to as the Trade Act). Section 255A of the Trade Act directs the Secretary of Commerce to submit an annual report on the Trade Adjustment Assistance for Firms (TAAF) program to Congress no later than December 15, 2012 and each year thereafter. The TAAF program is authorized by chapters 3 and 5 of title II of the Trade Act. Administered by the U.S. Department of Commerce’s Economic Development Administration (EDA), the goal of the TAAF program is to help economically distressed U.S. businesses develop strategies to compete in the global economy. Through a partnership with a national network of 11 EDA-funded Trade Adjustment Assistance Centers (TAACs), the program provides costsharing technical assistance to help eligible businesses create and implement targeted business recovery plans (referred to as ‘‘Adjustment Proposals’’ or ‘‘APs’’) aimed at boosting global competitiveness, increasing sales and retaining and creating jobs. The TAACs, which are either independent or university-affiliated entities, provide support to import-impacted firms in a public-private collaborative framework. The TAAF program provides a portion of the assistance while participating firms contribute a matching share to create and implement their recovery plans. EDA’s partnership with the TAAC network across the country allows firms to receive customized assistance from highly qualified experts who are knowledgeable about the needs, challenges and opportunities facing the industries in their region. The most common types of assistance provided in FY 2012 were marketing/sales improvement and production/ engineering projects, which comprised over half of all projects supported throughout the year. In January 2011, as authorization of the Trade Adjustment Assistance (TAA) programs at the U.S. Department of Labor (DOL), U.S. Department of Agriculture (USDA) and EDA was about to expire, Congress passed the Omnibus Trade Act of 2010 (Pub. L. 111–344). This Act extended the TAAF program through February 12, 2012, but allowed PO 00000 Frm 00004 Fmt 4701 Sfmt 4703 some provisions—such as eligibility for service firms and expanded time periods for qualifying firm eligibility— provided under the Trade and Globalization Adjustment Assistance Act of 2009 (TGAAA) to expire on February 13, 2011.4 The TAAF program remained authorized in FY 2011 and continued to operate at FY 2010 spending levels of $15.8 million under a full-year continuing resolution, which prevented interruption of program operations. On October 21, 2011, the President signed into law the Trade Adjustment Assistance Extension Act of 2011 (Pub. L. 112–40). This Act retroactively extended the provisions of the TAA programs that were enacted as part of the TGAAA. The expiration of the TGAAA provisions did, however, limit the number of firms entering the program as TAACs were unable to assist service firms or use extended ‘‘look-back periods’’ to certify firms. In addition, uncertainty regarding the TAAF program’s future caused TAACs to focus on existing clients instead of recruiting new firms. As part of its overall commitment to performance evaluation and continuous improvement, EDA assesses the performance of the TAAF program both in terms of ‘‘inputs’’ (e.g., types of firms assisted, petition, and AP submissions) and ‘‘outputs’’ (changes in sales, employment levels, and productivity of client firms). In terms of inputs, the TAAF program effectively targeted small and mediumsized firms in FY 2012. TAACs provided technical assistance to 341 firms in preparing petitions, 206 firms in preparing APs, and 935 firms in implementing projects within their APs. Meanwhile, EDA certified 79 petitions and approved 102 APs. EDA successfully met both the 40-day processing deadline (to make a final determination for petitions accepted for filing) and the 60-day processing deadline for approval of APs, as required in the TGAAA. In FY 2012, the average processing time for petitions was 29 business days, and the average processing time for APs was 21 business days. In order to assess the effectiveness of the TAAF program in terms of outputs, EDA assesses the extent to which client firms increased their sales, employment levels, and productivity following the implementation of TAAF-supported 4 The TGAAA was included as subtitle I (letter ‘‘I’’) of title I of Division B of the American Recovery and Reinvestment Act of 2009 (ARRA) (Pub. L. 111–5, Stat. 115 at 367). E:\FR\FM\31DEN2.SGM 31DEN2 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices projects (program completion). To measure these outputs, EDA compares average sales, average employment and average productivity of all firms completing the program in a particular year (the most recent ‘‘base year’’) to these same measures for the same firms one and two years following program completion. The base year used for this report is FY 2010, as this allows EDA to compare these measures looking back both one and two years from the date of this report. Firms that completed the TAAF program in FY 2010 report that, at completion, average sales were $10.1 million, average employment was 53 and average sales per employee (productivity) was $191,328. One year after completing the program (FY 2011), these same firms reported that average sales increased by 11.4 percent, average employment increased by 13.2 percent, and average productivity decreased by 1.6 percent. For the sake of comparison to the universe of U.S. manufacturers, the U.S. Bureau of Labor Statistics (BLS) reports that, in FY 2011, the national manufacturing industry in aggregate experienced an average employment increase of only 1.9 percent. Two years after completing the program (FY 2012), these same firms reported that average sales increased by 26.8 percent, average employment increased by 13.2 percent, and average productivity increased by 11.9 percent. Meanwhile, BLS reported that the manufacturing industry in FY 2012 experienced an average employment increase of 3.5 percent and average productivity increase of 4.1 percent from FY 2010. Therefore, firms assisted by the TAAF program performed more successfully than the manufacturing industry as a whole. Additionally, all firms that completed the TAAF program in FY 2010 were in operation as of the end of FY 2012, indicating strong survival rates for TAAF-assisted firms. It should be noted that TAAF clients are operating in the same economic environment as other firms, but are also attempting to adjust to import pressures that may not impact other firms as severely, making the success of TAAFassisted firms even more notable. Table of Contents srobinson on DSK4SPTVN1PROD with Introduction Program Description Results/Findings Data for This Report (1) The number of firms that inquired about the program. (2) The number of petitions filed under section 251. (3) The number of petitions certified and denied by the Secretary. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 (4) The average time for processing petitions after the petitions are filed. (5) The number of petitions filed and firms certified for each Congressional District in the United States. (6) Of the number of petitions filed, the number of firms that entered the program and received benefits. (7) The number of firms that received assistance in preparing their petitions. (8) The number of firms that received assistance developing business recovery plans. (9) The number of business recovery plans approved and denied by the Secretary. (10) Average duration of benefits received under the program nationally and in each region served by an intermediary organization (the TAAC) referred to in section 253(b)(1) of the Trade Act. (11) Sales, employment, and productivity at each firm participating in the TAAF program at the time of certification. (12) Sales, employment, and productivity at each firm upon completion of the program and each year for the two-year period following completion. (13) The number of firms in operation as of the date of this report and the number of firms that ceased operations after completing the program in each year during the two-year period following completion of the program. (14) The financial assistance received by each firm participating in the program. (15) The financial contribution made by each firm participating in the program. (16) The types of technical assistance included in the business recovery plans of firms participating in the program. (17) The number of firms leaving the program before completing the project or projects in their business recovery plans and the reason the project or projects were not completed. (18) The total amount expended by all intermediary organizations referred to in Section 253(b)(1)and by each organization to administer the program. (19) The total amount expended by intermediary organizations to provide technical assistance to firms under the program nationally and in each region served by such an organization. Conclusion Supplement—TAAF Program Benefits to Manufacturing Firms Introduction This report is provided in compliance with Section 255A of chapter 3 of title II of the Trade Act. Section 255A of the Trade Act directs the Secretary of Commerce to provide an annual report on the Trade Adjustment Assistance for Firms (TAAF) program by the 15th of December. Section 255 of the Trade Act states: IN GENERAL.—Not later than December 15, 2012, and annually thereafter, the Secretary shall prepare a report containing data regarding the trade adjustment assistance for firms program under this chapter for the preceding fiscal year. The data shall include the following: PO 00000 Frm 00005 Fmt 4701 Sfmt 4703 77221 This report will provide findings and results classified by intermediary organization,5 state, and national totals,6 to the extent that the data are available on the following 19 measures: 1. The number of firms that inquired about the program. 2. The number of petitions filed under section 251. 3. The number of petitions certified and denied by the Secretary. 4. The average time for processing petitions after the petitions are filed. 5. The number of petitions filed and firms certified for each Congressional district of the United States. 6. Of the number of petitions filed, the number of firms that entered the program and received benefits. 7. The number of firms that received assistance in preparing their petitions. 8. The number of firms that received assistance developing business recovery plans. 9. The number of business recovery plans approved and denied by the Secretary. 10. The average duration of benefits received under the program nationally and in each region served by an intermediary organization referred to in section 253(b)(1) of the Trade Act. 11. Sales, employment, and productivity at each firm participating in the TAAF program at the time of certification. 12. Sales, employment, and productivity at each firm upon completion of the program and each year for the two-year period following completion. 13. The number of firms in operation as the date of the report and the number of firms that ceased operations after completing the program and in each year during the two-year period following completion of the program. 14. The financial assistance received by each firm participating in the program. 15. The financial contribution made by each firm participating in the program. 16. The types of technical assistance included in the business recovery plans of firms participating in the program. 17. The number of firms leaving the program before completing the project or projects in their business recovery plans and the reason the project was not completed. 18. The total amount expended by all intermediary organizations referred to in 5 ‘‘Intermediary Organization’’ referred to in section 253(b)(1) are the Trade Adjustment Assistance Centers (TAACs). 6 See chapter 3 of title II of the Trade Act, section 255A (b) Classification of Data. E:\FR\FM\31DEN2.SGM 31DEN2 77222 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices Section 253(b)(1) and by each organization to administer the program. 19. The total amount expended by intermediary organizations to provide technical assistance to firms under the program nationally and in each region served by such an organization. Program Description The TAAF program is authorized by chapters 3 and 5 of title II of the Trade Act. The responsibility for administering the TAAF program is delegated to EDA by the Secretary of Commerce. The TAAF program provides technical assistance to manufacturers and service firms affected by import competition in order to help them develop and implement projects to regain global competitiveness, increase profitability and create jobs. The mission of the TAAF program is to help U.S. firms regain competitiveness in the global economy. Import-impacted U.S. manufacturing, production and service firms can receive matching funds for projects that expand markets, strengthen operations and increase competitiveness through the TAAF program. The program provides assistance to support the development of business recovery plans (commonly referred to as ‘‘Adjustment Proposals or ‘‘APs’’), under Section 252 of the Trade Act, and matching funds to implement projects outlined in the APs. The TAAF program supports a national network of 11 independent non-profit or university-affiliated TAACs to help U.S. manufacturing, production, and service firms in all 50 States, the District of Columbia and the Commonwealth of Puerto Rico. Firms work with the TAACs to apply for certification of eligibility for TAAF assistance, and prepare and implement strategies to guide their economic recovery. EXHIBIT 1—TAACS AND THEIR RESPECTIVE SERVICE AREAS TAAC Service areas Great Lakes ............... Mid-America .............. Mid-Atlantic ................ Midwest ..................... New England ............. New York State ......... Northwest .................. Rocky Mountain ......... Southeastern ............. Indiana, Michigan and Ohio. Arkansas, Kansas and Missouri. Delaware, District of Columbia, Maryland, New Jersey, Pennsylvania, Virginia and West Virginia. Illinois, Iowa, Minnesota and Wisconsin. Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. New York. Alaska, Idaho, Montana, Oregon and Washington. Colorado, Nebraska, New Mexico, North Dakota, South Dakota, Utah and Wyoming. Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina, Tennessee and the Commonwealth of Puerto Rico. Louisiana, Oklahoma and Texas. Arizona, California, Hawaii and Nevada. Southwest .................. Western ..................... Farmers, which is administered by USDA. funds are applied toward helping firms access consultants, engineers, designers or industry experts to implement business improvement projects. These projects may cover a range of functional areas to improve a firm’s market position and increase its overall competitiveness, including engineering, information technology, management, market development, marketing, new product development, quality improvement and sales. Funds are not provided directly to firms; instead, EDA funds TAACs and TAACs use funds to pay a cost-shared proportion of the cost to secure specialized business consultants. As noted above, the TAAF program provides technical assistance to help firms develop and implement business recovery plans, or APs. Projects identified in the AP are designed to improve a firm’s competitive position. Specifically, under the TAAF program, VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00006 Fmt 4701 Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 EN31DE12.006</GPH> TAA for Workers and TAA for Community Colleges, which are both administered by DOL, and TAA for Program Initiative srobinson on DSK4SPTVN1PROD with The TAAF program is one of four distinct programs authorized under the Trade Act. The other TAA programs are Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices srobinson on DSK4SPTVN1PROD with Phase I—Petitioning for Certification The first step to receiving assistance is the submission of a petition to EDA to be certified as a trade-impacted firm. A petition is comprised of Form ED– 840P, titled ‘‘Petition by a Firm for Certification of Eligibility to Apply for Trade Adjustment Assistance,’’ and required supporting documentation. Generally, certification specialists in the TAACs work with the firm at no cost to complete and submit a petition to EDA. Upon receipt of the petition, EDA performs an analysis of the petition and supporting documents to determine if the petition is complete and may be accepted. EDA is required to make a final determination on the petition within 40 days of accepting a petition.7 To certify a firm as eligible to apply for adjustment assistance, the Secretary must determine that the following three conditions are met: 1. A significant number or proportion of the workers in the firm have been or are threatened to be totally or partially separated; 2. Sales and/or production of the firm have decreased absolutely, or sales and/ or production of an article or service that accounted for at least 25 percent of total production or sales of the firm during the 12, 24, or 36 months preceding the most recent 12-, 24-, or 36-month period for which data are available have decreased absolutely; and 3. Increased imports of articles like or directly competitive with articles produced or services provided by the firm have ‘‘contributed importantly’’ to both the layoffs and the decline in sales and/or production. 7 As of May 17, 2009, the deadline for making a final determination is 40 days. Before May 17, 2009, EDA had 60 days to make a determination. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 Phase II—Recovery Planning Certified firms then work with TAAC staff to develop a customized AP for submission to EDA for approval. Once an AP has been submitted, EDA is required to make a final determination within 60 days. Phase III—AP Implementation The firm works with consultants to implement projects in an approved AP. As projects are implemented and if the firm is satisfied with the work, the firm will first pay their match to the consultant, and then send a notice to the TAAC stating that they are satisfied with the work and that they have paid their matching share. The TAAC will then pay the Federal matching share. Firms have up to five years from the date of an AP’s approval to implement the approved business recovery strategy contained therein, unless they receive approval for an extension. Generally, firms complete the implementation of their respective APs over a two-year period. In general, the TAACs provide an array of services to assist importimpacted firms throughout this process, including: • Assisting firms in preparing their petitions for TAAF. Firms are not charged for any assistance related to the preparation of a petition. • Once a petition has been approved, TAACs work closely with a firm’s management to identify the firm’s strengths and weaknesses and develop a customized business strategy (AP) designed to foster competitiveness. The program pays up to 75% of the cost of developing an AP and the firm must pay the rest. EDA must approve all APs to ensure they conform to statutory and regulatory requirements. • After an AP has been approved, company management and TAAC staff jointly identify consultants with the specific expertise required to assist the firm in implementing their competitiveness strategy. PO 00000 Frm 00007 Fmt 4701 Sfmt 4703 • Under the TAAF program, EDA shares the cost of implementing tasks under an approved AP to support competitiveness. For an AP in which proposed tasks total $30,000 or less, EDA provides up to 75 percent of the cost and the firm is responsible for the balance. For an AP in which proposed tasks total over $30,000, EDA pays 50 percent of the total cost and the firm pays the remaining 50 percent. In order to most efficiently and effectively utilize limited program funds, EDA limits its share of technical assistance to a certified firm to no more than $75,000. After a competitive procurement process, the TAAC and the firm generally contract with private consultants to implement the AP. Results/Findings Data for This Report The data used in this report were collected from the TAACs as part of their reporting requirements, petitions for certification, and the APs submitted by the TAACs on behalf of firms. Eligibility Reviewers at EDA recorded data from these sources into a central database. The data presented in this report has been verified by the TAACs. Results for average processing times were derived by EDA. Data in this report reflect data as of the end of FY 2012. Therefore, data in this Annual Report may differ from previously published data that were based on different periods. (1) The Number of Firms That Inquired About the Program In FY 2012, the TAACs received 1,849 inquiries about the program. Exhibit 4: Inquiries about the TAAF program by TAAC TAAC Great Lakes .............................. E:\FR\FM\31DEN2.SGM 31DEN2 No. of firms that inquired about the TAAF program 65 EN31DE12.007</GPH> There are three main phases to receiving technical assistance under the TAAF program: (1) petitioning for certification, (2) recovery planning and (3) AP implementation. 77223 77224 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices No. of firms that inquired about the TAAF program TAAC Mid-America .............................. Mid-Atlantic ............................... Midwest ..................................... New England ............................ New York State ........................ Northwest .................................. Rocky Mountain ........................ Southeastern ............................ Southwest ................................. Western .................................... 140 79 49 34 79 81 263 53 390 616 Total ...................................... 1,849 (2) The number of petitions filed under section 251 (3) The number of petitions certified and denied by the Secretary (4) The average time for processing petitions after the petitions are filed As part of its overall commitment to performance evaluation and continuous improvement, EDA assesses the performance of the TAAF program both in terms of ‘‘inputs’’ (e.g., types of firms assisted, petition, and AP submissions) and ‘‘outputs’’ (changes in sales, employment levels, and productivity of client firms). In terms of inputs, the TAAF program effectively targeted small and mediumsized firms in FY 2012. EDA received 85 petitions, of which 83 were filed (accepted for investigation) under section 251 of the Trade Act, down by 46 petitions, a 36 percent decrease, compared to the number of petitions filed in FY 2011. EDA certified 79 petitions, down by 70 petitions, a 47 percent decrease compared to the number of certifications in FY 2011.8 Petitions are certified on a rolling basis throughout the year. Petitions certified in FY 2012 may be the result of those received or filed (accepted) in FY 2011, while petitions received or filed (accepted) in FY 2012 may not result in certification in FY 2012. EDA met the 40-day processing deadline (to make a final determination for petitions accepted for filing) in FY 2012. In fact, the averageprocessing time for petitions was 29 business days. EXHIBIT 5—PETITION ACTIVITY: FY 2008—FY 2012 9 Number of petitions received FY Number of petitions certified Number of petitions denied or withdrawn Average days between acceptance (filing) and certification Average days between receipt and certification ................................. ................................. ................................. ................................. ................................. 186 276 311 128 85 189 243 329 129 83 182 216 330 149 79 0 1 0 22 3 35 30 31 21 29 43 51 74 36 58 % Change (2011 to 2012) srobinson on DSK4SPTVN1PROD with 2008 2009 2010 2011 2012 Number of petitions accepted for filing (34%) (36%) (47%) (86%) 38% 61% 8 Some TAACs believe that fewer firms were eligible to participate in the program because the economy’s improvement from FY 2010 and FY 2011 prevented some firms from demonstrating a VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 decrease in employment, sales and production required for eligibility. 9 Petitions are certified on a rolling basis throughout the year, therefore activity in these PO 00000 Frm 00008 Fmt 4701 Sfmt 4703 categories may not result in certification within the same FY. These totals represent the activity under each category within FY 2012. E:\FR\FM\31DEN2.SGM 31DEN2 VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00009 Fmt 4701 Sfmt 4725 E:\FR\FM\31DEN2.SGM 31DEN2 77225 EN31DE12.008</GPH> srobinson on DSK4SPTVN1PROD with Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices 77226 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 9—PETITIONS RECEIVED, ACCEPTED (FILED) AND CERTIFIED BY TAAC: FY 2012 Number of petitions received TAAC Number of petitions accepted for filing Number of petitions certified Great Lakes ..................................................................................................................... Mid-America ..................................................................................................................... MidAtlantic ....................................................................................................................... Midwest ............................................................................................................................ New England ................................................................................................................... New York State ................................................................................................................ Northwest ......................................................................................................................... Rocky Mountain ............................................................................................................... Southeastern .................................................................................................................... Southwest ........................................................................................................................ Western ............................................................................................................................ 5 2 11 19 9 7 8 8 2 9 5 5 2 10 19 10 7 8 9 2 9 2 5 2 6 20 10 6 6 10 1 11 2 Total .......................................................................................................................... 85 83 79 EXHIBIT 11—PETITIONS FILED, ACCEPTED, AND CERTIFIED BY TAAC/STATE: FY 2012 srobinson on DSK4SPTVN1PROD with Great Lakes ..................................................................................................................... IN .............................................................................................................................. MI .............................................................................................................................. OH ............................................................................................................................ Mid-America ..................................................................................................................... AR ............................................................................................................................. KS ............................................................................................................................. MO ............................................................................................................................ Mid-Atlantic ...................................................................................................................... DC ............................................................................................................................. DE ............................................................................................................................. MD ............................................................................................................................ NJ ............................................................................................................................. PA ............................................................................................................................. VA ............................................................................................................................. WV ............................................................................................................................ Midwest ............................................................................................................................ IA .............................................................................................................................. IL ............................................................................................................................... MN ............................................................................................................................ WI ............................................................................................................................. New England ................................................................................................................... CT ............................................................................................................................. MA ............................................................................................................................ ME ............................................................................................................................ VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4703 Petitions accepted for filing Petitions certified 5 0 3 2 2 0 1 1 10 0 0 0 1 9 0 0 19 2 13 1 3 10 1 4 2 5 0 3 2 2 0 1 1 6 0 0 0 0 6 0 0 20 2 13 1 4 10 1 4 2 5 0 3 2 2 0 1 1 11 0 0 0 2 9 0 0 19 2 13 1 3 9 1 3 2 E:\FR\FM\31DEN2.SGM 31DEN2 EN31DE12.009</GPH> Petitions received TAAC/State 77227 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 11—PETITIONS FILED, ACCEPTED, AND CERTIFIED BY TAAC/STATE: FY 2012—Continued TAAC/State Petitions received Petitions accepted for filing Petitions certified NH ............................................................................................................................. RI .............................................................................................................................. VT ............................................................................................................................. New York State ................................................................................................................ NY ............................................................................................................................. Northwest ......................................................................................................................... AK ............................................................................................................................. ID .............................................................................................................................. MT ............................................................................................................................. OR ............................................................................................................................ WA ............................................................................................................................ ................................................................................................................................... Rocky Mountain ............................................................................................................... CO ............................................................................................................................ NE ............................................................................................................................. NM ............................................................................................................................ ND ............................................................................................................................. SD ............................................................................................................................. UT ............................................................................................................................. WY ............................................................................................................................ Southeastern .................................................................................................................... AL ............................................................................................................................. FL .............................................................................................................................. GA ............................................................................................................................. KY ............................................................................................................................. MS ............................................................................................................................ NC ............................................................................................................................. SC ............................................................................................................................. TN ............................................................................................................................. PR ............................................................................................................................. Southwest ................................................................................................................. LA ............................................................................................................................. OK ............................................................................................................................. TX ............................................................................................................................. Western .................................................................................................................... AZ ............................................................................................................................. CA ............................................................................................................................. NV ............................................................................................................................. 0 1 2 7 7 8 0 2 1 2 3 ............................ 8 3 0 0 0 2 2 1 2 1 0 0 0 0 1 0 0 0 9 2 0 7 5 2 1 2 0 1 2 7 7 8 0 2 1 2 3 ............................ 9 4 0 0 0 2 2 1 2 1 0 0 0 0 1 0 0 0 9 2 0 7 2 1 0 1 0 1 2 6 6 6 0 2 1 1 2 ............................ 10 4 1 0 0 2 2 1 1 1 0 0 0 0 0 0 0 0 11 4 0 7 2 1 0 1 Total ................................................................................................................... 85 83 79 srobinson on DSK4SPTVN1PROD with The majority of petitions certified under the TAAF program were submitted by firms in the manufacturing industry. Firms in technical services, transportation, and wholesale trade rounded out the remaining industries10. 10 As identified by the firm’s North American Industry Classification System (NAICS) code. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 77228 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices In FY 2012, 6 percent of firms certified for TAAF were identified by the TAACs as service sector firms.11 This is an increase over FY 2011, where 2 percent of firms certified were identified by the TAACs as service sector firms. As a result the Trade Adjustment Assistance Extension Act of 2011 (Pub. L. 112–40), which retroactively extended the provisions of the TAA programs that were enacted as part of the TGAAA, demand from service firms is likely to continue to increase. EXHIBIT 13—FIRMS CERTIFIED FOR TAAF SERVICE VS. MANUFACTURING: FY 2012 2011 ................................................................. 2012 ................................................................. (5) The number of petitions filed and firms certified for each Congressional District in the United States EXHIBIT 14—PETITIONS FILED (ACCEPTED) AND CERTIFIED BY CONGRESSIONAL DISTRICT: FY 2012 srobinson on DSK4SPTVN1PROD with TAAC/State congressional district Petitions accepted for filing Great Lakes ...... IN ...................... MI ...................... 2 ........................ 3 ........................ 4 ........................ OH .................... 6 ........................ 11 ...................... Mid-America ...... AR ..................... KS ..................... 4 ........................ MO .................... 8 ........................ MidAtlantic ........ DC ..................... DE ..................... 5 0 3 1 1 1 2 1 1 2 0 1 1 1 1 10 0 0 Petitions certified 5 0 3 1 1 1 2 1 1 2 0 1 1 1 1 6 0 0 11 Firms in the service sector may also perform dual functions as manufacturing firms and may VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 Percentage of manufacturing firms certified (percent) Manufacturing firms 149 79 146 74 98 94 EXHIBIT 14—PETITIONS FILED (ACCEPTED) AND CERTIFIED BY CONGRESSIONAL DISTRICT: FY 2012— Continued TAAC/State congressional district Petitions accepted for filing MD .................... NJ ..................... 7 ........................ PA ..................... 1 ........................ 3 ........................ 8 ........................ 10 ...................... 11 ...................... 15 ...................... 19 ...................... VA ..................... WV .................... Midwest ............. IA ...................... 1 ........................ 4 ........................ IL ....................... 1 ........................ 5 ........................ 6 ........................ 7 ........................ 0 1 1 9 1 1 1 1 1 1 3 0 0 19 2 1 1 13 1 1 1 2 Petitions certified 0 0 0 6 1 0 1 1 1 0 2 0 0 20 2 1 1 13 1 2 1 2 3 5 Frm 00012 Fmt 4701 Sfmt 4703 2 6 EXHIBIT 14—PETITIONS FILED (ACCEPTED) AND CERTIFIED BY CONGRESSIONAL DISTRICT: FY 2012— Continued TAAC/State congressional district Petitions accepted for filing 8 ........................ 10 ...................... 14 ...................... 16 ...................... MN .................... 4 ........................ WI ..................... 4 ........................ 6 ........................ 7 ........................ New England .... CT ..................... 2 ........................ MA .................... 2 ........................ 5 ........................ 9 ........................ 10 ...................... ME .................... 1 ........................ NH ..................... RI ...................... 2 4 1 1 1 1 3 1 0 2 10 1 1 4 1 1 1 1 2 2 0 1 have been categorized by TAACs as manufacturing firm. PO 00000 Percentage of service firms certified (percent) Service firms E:\FR\FM\31DEN2.SGM 31DEN2 Petitions certified 1 4 1 1 1 1 4 1 1 2 10 1 1 4 1 1 1 1 2 2 0 1 EN31DE12.010</GPH> Total number of firms certified FY 77229 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 14—PETITIONS FILED (ACCEPTED) AND CERTIFIED BY CONGRESSIONAL DISTRICT: FY 2012— Continued TAAC/State congressional district Petitions accepted for filing 2 ........................ VT ..................... 1 ........................ 5 ........................ New York State NY ..................... 5 ........................ 14 ...................... 20 ...................... 21 ...................... 24 ...................... 29 ...................... Northwest .......... AK ..................... ID ...................... 1 ........................ 2 ........................ MT ..................... At-Large ............ OR .................... 2 ........................ WA .................... 2 ........................ 3 ........................ Rocky Mountain CO .................... 1 ........................ 2 ........................ 1 2 1 1 7 7 1 1 1 1 1 2 8 0 2 1 1 1 1 2 2 3 2 1 9 4 2 1 Petitions certified 1 2 1 1 6 6 1 1 0 1 1 2 6 0 2 1 1 1 1 1 1 2 1 1 10 4 2 1 EXHIBIT 14—PETITIONS FILED (ACCEPTED) AND CERTIFIED BY CONGRESSIONAL DISTRICT: FY 2012— Continued TAAC/State congressional district Petitions accepted for filing 6 ........................ NE ..................... 2 ........................ NM .................... ND ..................... SD ..................... At-Large ............ UT ..................... 1 ........................ 2 ........................ WY .................... At-Large ............ Southeastern .... AL ..................... 3 ........................ FL ...................... GA ..................... KY ..................... MS .................... NC ..................... 12 ...................... SC ..................... TN ..................... PR ..................... Southwest ......... LA ..................... 1 ........................ 3 ........................ 1 0 0 0 0 2 2 2 1 1 1 1 2 1 1 0 0 0 0 1 1 0 0 0 9 2 1 1 Petitions certified 1 1 1 0 0 2 2 2 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 11 4 2 2 EXHIBIT 14—PETITIONS FILED (ACCEPTED) AND CERTIFIED BY CONGRESSIONAL DISTRICT: FY 2012— Continued TAAC/State congressional district Petitions accepted for filing OK ..................... TX ..................... 6 ........................ 13 ...................... 20 ...................... 23 ...................... 26 ...................... 28 ...................... Western ............ AZ ..................... 4 ........................ CA ..................... NV ..................... 2 ........................ 0 7 1 2 1 1 1 1 2 1 1 0 1 1 0 7 1 2 1 1 1 1 2 1 1 0 1 1 Total ........... 83 79 Petitions certified (6) Of the number of petitions filed, the number of firms that entered the program and received benefits12 In FY 2012, 83 petitions were accepted (filed) for certification, of which 79 were certified. Of the 79 firms certified in FY 2012, 57 firms submitted and were approved for an AP in the same fiscal year13. EXHIBIT 15—PETITIONS CERTIFIED AND APS APPROVED: FY 2012 Number of petitions accepted for filing TAAC Great Lakes ............................................................................................................................................. Mid-America ............................................................................................................................................. MidAtlantic ............................................................................................................................................... Midwest .................................................................................................................................................... New England ........................................................................................................................................... New York State ........................................................................................................................................ Northwest ................................................................................................................................................. Rocky Mountain ....................................................................................................................................... Southeastern ............................................................................................................................................ Southwest ................................................................................................................................................ Western .................................................................................................................................................... Total ......................................................................................................................................................... srobinson on DSK4SPTVN1PROD with (7) The number of firms that received assistance in preparing their petitions In FY 2012, 341 firms received assistance in preparing petitions. Firms may receive assistance in all phases of preparing petitions more than once in a single year. Petition assistance rendered may not result in the submission of a petition in the fiscal year. Exhibit 16: Petition Assistance Activity: FY 2012 12 Benefits are defined as technical assistance provided to TAAF-certified firms in preparing and implementing business recovery plans (APs). 13 Firms have up to two years from the date of TAAF certification to submit a business recovery plan (AP). These totals represent the firms certified for TAAF in FY 2012 that also submitted and VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 5 2 10 19 10 7 8 9 2 9 2 83 Number of petitions certified 5 2 6 20 10 6 6 10 1 11 2 79 Frm 00013 Fmt 4701 Sfmt 4703 5 1 2 16 10 2 6 10 1 4 0 57 EXHIBIT 16—PETITION ASSISTANCE ACTIVITY: FY 2012 TAAC Great Lakes .............................. Mid-America .............................. MidAtlantic ................................ PO 00000 Number of APs approved for firms certified in FY 2012 Petition Assistance 13 15 22 received an approved business recovery plan in the same fiscal year. The total number of APs approved in FY 2012 is reported in Exhibits 19, 20 and 21. E:\FR\FM\31DEN2.SGM 31DEN2 77230 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 16—PETITION ASSISTANCE ACTIVITY: FY 2012—Continued EXHIBIT 17—AP DEVELOPMENT ACTIVITY: FY 2012 Petition Assistance TAAC Midwest ..................................... New England ............................ New York State ........................ Northwest .................................. Rocky Mountain ........................ Southeastern ............................ Southwest ................................. Western .................................... Total .......................................... 117 10 36 18 15 36 37 22 341 (8) The number of firms that received assistance developing business recovery plans In FY 2012, 206 firms received assistance in developing APs and 935 firms received assistance in implementing projects in these plans. Firms may receive assistance in developing and implementing APs more than once in a single year. AP assistance rendered may not result in the submission or implementation of an AP in the current fiscal year. EXHIBIT 18—AP IMPLEMENTATION ACTIVITY: FY 2012—Continued AP Development Assistance TAAC Great Lakes .............................. Mid-America .............................. MidAtlantic ................................ Midwest ..................................... New England ............................ New York State ........................ Northwest .................................. Rocky Mountain ........................ Southeastern ............................ Southwest ................................. Western .................................... Total .......................................... 7 6 12 61 14 25 11 11 5 48 6 206 AP Implementation Assistance TAAC MidAtlantic ................................ Midwest ..................................... New England ............................ New York State ........................ Northwest .................................. Rocky Mountain ........................ Southeastern ............................ Southwest ................................. Western .................................... Total .......................................... 81 142 133 45 80 74 65 52 39 935 (9) The number of business recovery plans approved and denied by the Secretary EXHIBIT 18—AP IMPLEMENTATION ACTIVITY: FY 2012 In FY 2012, EDA approved 102 APs, down by 81 compared to FY 2011, a 44 AP Implepercent decrease over this period 14. TAAC mentation EDA successfully met the 60-day Assistance processing deadline for approval of APs. Great Lakes .............................. 71 The average processing time for APs Mid-America .............................. 153 was 21 business days 15. EXHIBIT 19—SUMMARY OF APS APPROVED: FY 2008—FY 2012 Number of APs approved FY Total firm share Total projected AP costs Average government assistance per firm Average days between submission and approval ................................. ................................. ................................. ................................. ................................. 143 172 264 183 102 $8,202,625 10,393,639 16,448,946 11,075,545 5,437,455 $7,711,375 9,888,201 15,743,946 10,580,545 5,033,455 $15,914,000 20,281,840 32,192,892 21,656,090 10,470,910 $57,361 60,428 62,307 60,522 53,308 21 20 24 16 21 Total ................................. 864 51,558,210 48,957,522 100,515,732 59,674 20 % Change ........................ (2011 to 2012) ................. srobinson on DSK4SPTVN1PROD with 2008 2009 2010 2011 2012 Total government share (44%) (51%) (52%) (52%) (12%) 31% 14 Some TAACs believe that fewer firms were eligible to participate in the program because the economy’s improvement from FY 2010 and FY 2011 prevented some firms from demonstrating a VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 decrease in employment, sales, and production required for eligibility. Subsequently, fewer APs were submitted. PO 00000 Frm 00014 Fmt 4701 Sfmt 4703 15 Firms have two years from the date of certification to submit an AP to EDA. APs approved in FY 2012 may represent firms that were certified for TAAF between FY 2010—FY 2012. E:\FR\FM\31DEN2.SGM 31DEN2 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices 77231 Exhibit 21: APs Approved by TAAC/ State: FY 2012 EXHIBIT 20—APS APPROVED BY TAAC: FY 2008—FY 2012 Number of APs approved Government share of approved AP projects Firm share of approved AP projects Total approved AP projects Great Lakes ..................................................................................... MI .............................................................................................. OH ............................................................................................ Mid-America ..................................................................................... KS ............................................................................................. MO ............................................................................................ MidAtlantic ....................................................................................... PA ............................................................................................. Midwest ..................................................................................... IA .............................................................................................. IL ............................................................................................... MN ............................................................................................ WI ............................................................................................. New England ................................................................................... CT ............................................................................................. MA ............................................................................................ ME ............................................................................................ RI .............................................................................................. VT ............................................................................................. .......................................................................................................... New York State ................................................................................ NY ............................................................................................. Northwest ......................................................................................... ID .............................................................................................. MT ............................................................................................. OR ............................................................................................ WA ............................................................................................ Rocky Mountain ............................................................................... CO ............................................................................................ NE ............................................................................................. NM ............................................................................................ SD ............................................................................................. UT ............................................................................................. WY ............................................................................................ ................................................................................................... Southeastern .................................................................................... AL ............................................................................................. GA ............................................................................................. NC ............................................................................................. 6 3 3 3 2 1 10 10 23 1 17 1 4 14 3 5 2 2 2 ............................ 9 9 9 3 1 2 3 11 4 1 1 2 2 1 ............................ 5 1 1 2 $345,000 172,500 172,500 225,000 150,000 75,000 519,650 519,650 1,177,972 22,500 885,472 75,000 195,000 600,000 122,500 130,000 150,000 47,500 150,000 ............................ 604,000 604,000 583,333 172,500 75,000 128,000 207,833 527,500 160,000 30,000 75,000 82,500 150,000 30,000 ............................ 217,500 75,000 22,500 97,500 $315,000 157,500 157,500 225,000 150,000 75,000 504,650 504,650 1,057,972 7,500 810,472 75,000 165,000 510,000 107,500 70,000 150,000 32,500 150,000 ............................ 590,000 590,000 568,333 157,500 75,000 128,000 207,833 527,500 160,000 30,000 75,000 82,500 150,000 30,000 ............................ 172,500 75,000 7,500 82,500 $660,000 330,000 330,000 450,000 300,000 150,000 1,024,300 1,024,300 2,235,944 30,000 1,695,944 150,000 360,000 1,110,000 230,000 200,000 300,000 80,000 300,000 ............................ 1,194,000 1,194,000 1,151,666 330,000 150,000 256,000 415,666 1,055,000 320,000 60,000 150,000 165,000 300,000 60,000 ............................ 390,000 150,000 30,000 180,000 VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 EN31DE12.011</GPH> srobinson on DSK4SPTVN1PROD with TAAC/State 77232 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 20—APS APPROVED BY TAAC: FY 2008—FY 2012—Continued Number of APs approved TAAC/State Government share of approved AP projects Firm share of approved AP projects Total approved AP projects SC ............................................................................................. Southwest ........................................................................................ LA ............................................................................................. OK ............................................................................................. TX ............................................................................................. Western ............................................................................................ CA ............................................................................................. 1 10 3 2 5 2 2 22,500 592,500 120,000 150,000 322,500 45,000 45,000 7,500 547,500 90,000 150,000 307,500 15,000 15,000 30,000 1,140,000 210,000 300,000 630,000 60,000 60,000 Total ................................................................................... 102 5,437,455 5,033,455 10,470,910 (10) Average duration of benefits received under the program nationally and in each region served by an intermediary organization (the TAAC) referred to in section 253(b)(1) of the Trade Act In FY 2012, 145 firms exited the TAAF program after being approved for an AP. Nationally, firms receive on average 57 months 16 of benefits under the TAAF program. When calculating the average duration of benefits regionally, firms received on average 55 months of benefits under the TAAF program. EXHIBIT 22: AVERAGE DURATION OF BENEFITS RECEIVED—FIRMS THAT COMPLETED PROGRAM: FY 2012 srobinson on DSK4SPTVN1PROD with Firm number No. of months firms received benefits under TAAF program GLTAAC–EXT–001 .................. GLTAAC–EXT–002 .................. GLTAAC–EXT–003 .................. GLTAAC–EXT–004 .................. MamTAAC–EXT–001 ............... MamTAAC–EXT–002 ............... MamTAAC–EXT–003 ............... MamTAAC–EXT–004 ............... MamTAAC–EXT–005 ............... MamTAAC–EXT–006 ............... MamTAAC–EXT–007 ............... MamTAAC–EXT–008 ............... MamTAAC–EXT–009 ............... MamTAAC–EXT–010 ............... MamTAAC–EXT–011 ............... MamTAAC–EXT–012 ............... MamTAAC–EXT–013 ............... MamTAAC–EXT–014 ............... MamTAAC–EXT–015 ............... MamTAAC–EXT–016 ............... MamTAAC–EXT–017 ............... MamTAAC–EXT–018 ............... 34 56 53 39 63 66 135 15 82 78 78 48 66 65 64 38 91 84 74 56 90 25 16 Prior to 2008, firms were allowed in excess of five years to complete projects, resulting in a longer than average duration of benefits. Firms have five years from the date of AP approval to complete their projects. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 EXHIBIT 22: AVERAGE DURATION OF BENEFITS RECEIVED—FIRMS THAT COMPLETED PROGRAM: FY 2012— Continued EXHIBIT 22: AVERAGE DURATION OF BENEFITS RECEIVED—FIRMS THAT COMPLETED PROGRAM: FY 2012— Continued No. of months firms received benefits under TAAF program No. of months firms received benefits under TAAF program Firm number MamTAAC–EXT–019 ............... MamTAAC–EXT–020 ............... MamTAAC–EXT–021 ............... MamTAAC–EXT–022 ............... MamTAAC–EXT–023 ............... MamTAAC–EXT–024 ............... MamTAAC–EXT–025 ............... MamTAAC–EXT–026 ............... MamTAAC–EXT–027 ............... MamTAAC–EXT–028 ............... MamTAAC–EXT–029 ............... MamTAAC–EXT–030 ............... MamTAAC–EXT–031 ............... MamTAAC–EXT–032 ............... MamTAAC–EXT–033 ............... MamTAAC–EXT–034 ............... MATAAC–EXT–001 .................. MATAAC–EXT–002 .................. MATAAC–EXT–003 .................. MATAAC–EXT–004 .................. MATAAC–EXT–005 .................. MATAAC–EXT–006 .................. MATAAC–EXT–007 .................. MATAAC–EXT–008 .................. MATAAC–EXT–009 .................. MATAAC–EXT–010 .................. MATAAC–EXT–011 .................. MATAAC–EXT–012 .................. MATAAC–EXT–013 .................. MWTAAC–EXT–001 ................. MWTAAC–EXT–002 ................. MWTAAC–EXT–003 ................. MWTAAC–EXT–004 ................. MWTAAC–EXT–005 ................. MWTAAC–EXT–006 ................. MWTAAC–EXT–007 ................. MWTAAC–EXT–008 ................. MWTAAC–EXT–009 ................. MWTAAC–EXT–010 ................. MWTAAC–EXT–011 ................. MWTAAC–EXT–012 ................. MWTAAC–EXT–013 ................. MWTAAC–EXT–014 ................. MWTAAC–EXT–015 ................. MWTAAC–EXT–016 ................. PO 00000 Frm 00016 Fmt 4701 Sfmt 4703 70 76 32 72 72 78 63 24 25 43 70 79 70 71 71 83 23 53 16 53 59 34 46 35 46 59 41 32 72 25 24 79 72 68 76 69 65 48 61 61 71 32 24 24 72 Firm number NETAAC–EXT–001 .................. NETAAC–EXT–002 .................. NETAAC–EXT–003 .................. NETAAC–EXT–004 .................. NETAAC–EXT–005 .................. NETAAC–EXT–006 .................. NETAAC–EXT–007 .................. NETAAC–EXT–008 .................. NETAAC–EXT–009 .................. NETAAC–EXT–010 .................. NETAAC–EXT–011 .................. NETAAC–EXT–012 .................. NETAAC–EXT–013 .................. NETAAC–EXT–014 .................. NETAAC–EXT–015 .................. NWTAAC–EXT–001 ................. NWTAAC–EXT–002 ................. NWTAAC–EXT–003 ................. NWTAAC–EXT–004 ................. NWTAAC–EXT–005 ................. NWTAAC–EXT–006 ................. NWTAAC–EXT–007 ................. NWTAAC–EXT–008 ................. NWTAAC–EXT–009 ................. NWTAAC–EXT–010 ................. NWTAAC–EXT–011 ................. NWTAAC–EXT–012 ................. NYSTAAC–EXT–001 ................ NYSTAAC–EXT–002 ................ NYSTAAC–EXT–003 ................ NYSTAAC–EXT–004 ................ RMTAAC–EXT–001 .................. RMTAAC–EXT–002 .................. RMTAAC–EXT–003 .................. RMTAAC–EXT–004 .................. RMTAAC–EXT–005 .................. RMTAAC–EXT–006 .................. RMTAAC–EXT–007 .................. RMTAAC–EXT–008 .................. RMTAAC–EXT–009 .................. RMTAAC–EXT–010 .................. RMTAAC–EXT–011 .................. RMTAAC–EXT–012 .................. RMTAAC–EXT–013 .................. RMTAAC–EXT–014 .................. E:\FR\FM\31DEN2.SGM 31DEN2 19 64 53 23 18 22 14 42 33 70 53 23 26 25 33 71 92 21 81 80 82 20 13 63 20 20 40 43 22 64 49 51 81 84 81 60 69 67 36 72 36 29 79 30 77 77233 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 22: AVERAGE DURATION OF BENEFITS RECEIVED—FIRMS THAT COMPLETED PROGRAM: FY 2012— Continued EXHIBIT 22: AVERAGE DURATION OF BENEFITS RECEIVED—FIRMS THAT COMPLETED PROGRAM: FY 2012— Continued EXHIBIT 23—AVERAGE DURATION OF BENEFITS RECEIVED—FIRMS THAT COMPLETED PROGRAM BY TAAC (REGION): FY 2012—Continued No. of months firms received benefits under TAAF program No. of months firms received benefits under TAAF program Average Number of months firms received benefits Firm number RMTAAC–EXT–015 .................. RMTAAC–EXT–016 .................. RMTAAC–EXT–017 .................. RMTAAC–EXT–018 .................. SETAAC–EXT–001 .................. SETAAC–EXT–002 .................. SETAAC–EXT–003 .................. SETAAC–EXT–004 .................. SETAAC–EXT–005 .................. SETAAC–EXT–006 .................. SETAAC–EXT–007 .................. SETAAC–EXT–008 .................. SWTAAC–EXT–001 ................. SWTAAC–EXT–002 ................. SWTAAC–EXT–003 ................. SWTAAC–EXT–004 ................. SWTAAC–EXT–005 ................. SWTAAC–EXT–006 ................. SWTAAC–EXT–007 ................. SWTAAC–EXT–008 ................. SWTAAC–EXT–009 ................. SWTAAC–EXT–010 ................. WTAAC–EXT–001 .................... WTAAC–EXT–002 .................... WTAAC–EXT–003 .................... WTAAC–EXT–004 .................... WTAAC–EXT–005 .................... 46 78 75 49 36 30 45 36 36 53 80 73 80 26 26 68 68 69 66 80 74 24 90 122 81 91 116 Firm number WTAAC–EXT–006 .................... WTAAC–EXT–007 .................... WTAAC–EXT–008 .................... WTAAC–EXT–009 .................... WTAAC–EXT–010 .................... WTAAC–EXT–011 .................... Total National Average ............. 87 82 127 114 108 109 57 EXHIBIT 23—AVERAGE DURATION OF BENEFITS RECEIVED—FIRMS THAT COMPLETED PROGRAM BY TAAC (REGION): FY 2012 Average Number of months firms received benefits TAAC Great Lakes .............................. Mid-America .............................. Mid-Atlantic ............................... Midwest ..................................... New England ............................ 46 65 44 54 35 TAAC New York State ........................ Northwest .................................. Rocky Mountain ........................ Southeastern ............................ Southwest ................................. Western .................................... 45 50 61 49 58 102 (11) Sales, employment, and productivity at each firm participating in the TAAF program at the time of certification In FY 2012, 889 active firms participated in the TAAF program. A firm that has been certified for TAAF, and/or has an approved AP, has not completed all projects in their AP, and is still engaged in the TAAF program is considered ‘‘active.’’ For the purposes of this report, productivity is defined as net sales per employee. Since the certified firms are in various industries, which have a variety of ways to measure productivity, sales per employee is utilized as a standardized measure for assessing productivity across all firms assisted. EXHIBIT 24—SALES, EMPLOYMENT, AND PRODUCTIVITY 17 AT ALL FIRMS PARTICIPATING IN THE TAAF PROGRAM IN FY 2012 BY TAAC AND STATE: Total No. of Active Firms in FY 2012 srobinson on DSK4SPTVN1PROD with TAAC/State Great Lakes ..................................................................................... IN .............................................................................................. MI .............................................................................................. OH ............................................................................................ Mid-America ..................................................................................... AR ............................................................................................. KS ............................................................................................. MO ............................................................................................ MidAtlantic ....................................................................................... MD ............................................................................................ NJ ............................................................................................. PA ............................................................................................. VA ............................................................................................. Midwest ............................................................................................ IA .............................................................................................. IL ............................................................................................... MN ............................................................................................ WI ............................................................................................. New England ................................................................................... CT ............................................................................................. MA ............................................................................................ ME ............................................................................................ NH ............................................................................................. RI .............................................................................................. VT ............................................................................................. New York State ................................................................................ NY ............................................................................................. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00017 Fmt 4701 73 18 31 24 46 7 15 24 90 3 4 80 3 137 5 81 23 28 133 19 60 15 20 16 3 61 61 Sfmt 4703 Total Sales at Certification Total Employment at Certification $1,791,172,281 278,004,201 547,706,669 965,461,411 682,877,581 16,401,481 149,072,277 517,403,823 1,049,770,941 5,500,143 22,286,404 1,008,680,988 13,303,406 2,212,081,842 120,097,360 843,583,273 367,933,664 880,467,545 1,011,453,493 135,382,965 400,041,096 230,970,276 131,043,944 77,235,126 36,780,086 1,172,727,977 1,172,727,977 E:\FR\FM\31DEN2.SGM 9,760 2,253 2,254 5,253 4,951 340 1,436 3,175 6,548 47 195 6,121 185 11,961 519 4,887 2,512 4,043 6,479 926 2,574 1,177 902 619 281 4,823 4,823 31DEN2 Total Average Productivity $183,522 123,393 242,993 183,792 137,927 48,240 103,811 162,962 160,319 117,024 114,289 164,790 71,910 184,941 231,401 172,618 146,470 217,776 156,113 146,202 155,416 196,236 145,282 124,774 130,890 243,153 243,153 77234 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 24—SALES, EMPLOYMENT, AND PRODUCTIVITY 17 AT ALL FIRMS PARTICIPATING IN THE TAAF PROGRAM IN FY 2012 BY TAAC AND STATE:—Continued Total No. of Active Firms in FY 2012 TAAC/State Northwest ......................................................................................... AK ............................................................................................. ID .............................................................................................. MT ............................................................................................. OR ............................................................................................ WA ............................................................................................ Rocky Mountain ............................................................................... CO ............................................................................................ ND ............................................................................................. NE ............................................................................................. NM ............................................................................................ SD ............................................................................................. UT ............................................................................................. WY ............................................................................................ Southeastern .................................................................................... AL ............................................................................................. FL .............................................................................................. GA ............................................................................................. KY ............................................................................................. MS ............................................................................................ NC ............................................................................................. SC ............................................................................................. TN ............................................................................................. Southwest ........................................................................................ LA ............................................................................................. OK ............................................................................................. TX ............................................................................................. Western ............................................................................................ AZ ............................................................................................. CA ............................................................................................. HI .............................................................................................. Total (Nationwide) ............................................................................ srobinson on DSK4SPTVN1PROD with (12) Sales, employment, and productivity at each firm upon completion of the program and each year for the two-year period following completion (13) The number of firms in operation as of the date of this report and the number of firms that ceased operations after completing the program in each year during the two-year period following completion of the program 17 The total productivity as presented in across TAACs, States and the summary line of Exhibit 24 represents the actual total average productivity in FY 2012. This total, derived by calculating the mean horizontally (not vertically), is based on raw data and provides the most accurate representation of productivity for all TAACs and States. While this figure is provided in the table, it should be noted that calculating total productivity vertically introduces additional degrees of error as it represents the average of averages.18 The total productivity as presented in across TAACs, States and the summary line of Exhibit 24 represents the actual total average productivity in FY 2012. This total, derived by calculating the mean horizontally (not vertically), is based on raw data and provides the most accurate representation of productivity for all TAACs and States. While this figure is provided in the table, it should be noted that calculating total productivity vertically introduces additional degrees of error as it represents the average of averages. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 85 4 11 11 20 39 67 28 6 5 4 8 13 3 67 4 6 13 3 1 25 10 5 90 19 30 41 40 3 35 2 889 Total Sales at Certification 913,564,319 22,825,992 62,150,148 54,667,266 419,792,240 354,128,673 2,479,134,862 994,105,459 155,904,843 32,840,837 40,663,880 342,138,076 862,552,034 50,929,733 998,693,863 28,653,300 18,996,354 90,265,046 91,456,507 2,496,868 511,427,054 183,496,458 71,902,276 421,071,529 114,522,181 156,841,533 149,707,815 773,072,997 92,655,000 657,349,131 23,068,866 13,505,621,685 In order to assess the effectiveness of the TAAF program in terms of outputs, EDA assesses the extent to which client firms increased their sales, employment levels, and productivity following the implementation of TAAF-supported projects (program completion). To measure these outputs, EDA compares average sales, average employment and average productivity of all firms completing the program in a particular year (the most recent ‘‘base year’’) to these same measures for the same firms one and two years following program completion. The base year used for this report is FY 2010, as this allows EDA to compare these measures looking back both one and two years from the date of this report. Firms that completed the TAAF program in FY 2010 reported that, at completion, average sales were $10.1 million, average employment was 53 and average sales per employee (productivity) was $191,328. One year after completing the program (FY 2011), these same firms reported that average sales increased by 11.4 percent, average employment increased by 13.2 percent, and average productivity decreased by PO 00000 Frm 00018 Fmt 4701 Sfmt 4703 Total Employment at Certification 5,745 110 688 415 2,211 2,321 10,068 2,956 714 243 290 1,246 4,302 317 10,038 346 191 978 488 21 6,607 922 485 3,637 551 1,563 1,523 3,507 400 2,981 126 77,517 Total Average Productivity 159,019 207,509 90,335 131,728 189,865 152,576 246,239 336,301 218,354 135,147 140,220 274,589 200,500 160,662 99,491 82,813 99,457 92,296 187,411 118,898 77,407 199,020 148,252 115,774 207,844 100,346 98,298 220,437 231,638 220,513 183,086 174,22818 1.6 percent. For the sake of comparison to the universe of U.S. manufacturers, BLS reported that, in FY 2011, the national manufacturing industry in aggregate experienced an average employment increase of only 1.9 percent. Two years after completing the program (FY 2012), these same firms reported that average sales increased by 26.8 percent, average employment increased by 13.2 percent, and average productivity 19 increased by 11.9 percent. Meanwhile, BLS reported that the manufacturing industry in FY 2012 experienced an average employment increase of 3.5 percent and an average productivity increase of 4.1 percent from FY 2010. Therefore, firms assisted by the TAAF program performed more successfully than the manufacturing industry as a whole. Additionally, all firms that completed the TAAF program in FY 2010 were in operation as of the end of FY 2012, indicating strong ‘‘survival rates’’ for TAAF-assisted firms. It should be noted that TAAF clients are operating in the same 19 BLS’ productivity measures relate output to the labor hours used in the production of that output. E:\FR\FM\31DEN2.SGM 31DEN2 77235 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices economic environment as other firms, but are also attempting to adjust to import pressures that may not impact other firms as severely, making the success of TAAF-assisted firms even more notable. For the purposes of this report, data are reported only for firms where all data were available. Since the certified firms are in various industries, which have a variety of ways to measure productivity, sales per employee was chosen as the productivity measure. This measure is used because it can be generally applied to all certified firms. EXHIBIT 25—SUMMARY OF AVERAGE SALES, EMPLOYMENT, AND PRODUCTIVITY AT FIRMS UPON COMPLETION OF THE PROGRAM AND THE ONE-YEAR AND TWO-YEAR PERIOD FOLLOWING COMPLETION Completion (FY 2010) srobinson on DSK4SPTVN1PROD with Average Sales ...................................................................... Average Employment ........................................................... Average Productivity ............................................................ VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00019 $10,140,385 53 $191,328 Fmt 4701 1st Year following completion (FY 2011) 2nd Year following completion (FY 2012) % Change 1st Year (percent) % Change 2nd Year (percent) $11,300,792 60 $188,347 $12,855,193 60 $214,253 11.4% 13.2 (1.6%) 26.8% 13.2 11.9% Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 Average sales at completion (FY 2010) $23,000,000 33,291,000 33,000,000 30,421,806 9,969,765 5,849,007 1,900,000 1,261,088 2,202,559 10,613,000 7,570,000 4,412,568 6,414,455 8,694,000 14,603,721 18,585,466 2,100,000 13,000 55,571,000 3,500,000 680,000 8,000,000 14,000,000 1,730,000 1,900,000 4,000,000 2,100,000 990,000 12,100,000 535,000 4,900,000 3,100,000 7,800,000 36,000,000 123,000 1,547,913 2,715,885 10,140,385 Firm ID GLTAAC–CMP–001 .................... GLTAAC–CMP–002 .................... GLTAAC–CMP–003 .................... MamTAAC–CMP–002 ................. MamTAAC–CMP–006 ................. MamTAAC–CMP–007 ................. MamTAAC–CMP–010 ................. MamTAAC–CMP–013 ................. MamTAAC–CMP–014 ................. MamTAAC–CMP–016 ................. MamTAAC–CMP–018 ................. MamTAAC–CMP–021 ................. MamTAAC–CMP–023 ................. MamTAAC–CMP–025 ................. MWTAAC–CMP–001 ................... MWTAAC–CMP–006 ................... NWTAAC–CMP–001 ................... NWTAAC–CMP–002 ................... NWTAAC–CMP–003 ................... NWTAAC–CMP–004 ................... NWTAAC–CMP–005 ................... NWTAAC–CMP–006 ................... NWTAAC–CMP–007 ................... NWTAAC–CMP–008 ................... NWTAAC–CMP–010 ................... NYSTAAC–CMP–001 .................. NYSTAAC–CMP–002 .................. NYSTAAC–CMP–003 .................. NYSTAAC–CMP–004 .................. NYSTAAC–CMP–005 .................. NYSTAAC–CMP–006 .................. NYSTAAC–CMP–007 .................. NYSTAAC–CMP–008 .................. NYSTAAC–CMP–009 .................. RMTAAC–CMP–001 .................... RMTAAC–CMP–002 .................... RMTAAC–CMP–003 .................... VerDate Mar<15>2010 Total Average .............................. 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00020 Fmt 4701 Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 11,300,792 $40,200,000 35,000,000 38,000,000 35,697,560 8,969,168 4,778,810 2,533,745 2,084,480 2,635,713 10,980,000 8,456,000 6,984,385 5,697,336 5,630,530 14,600,000 21,900,000 3,085,000 6,000 64,167,000 2,680,000 440,000 13,000,000 10,000,000 1,975,000 2,100,000 4,100,000 2,100,000 950,000 12,200,000 500,000 5,600,000 3,600,000 7,700,000 34,000,000 138,000 2,500,722 3,139,869 Average sales 1st Yr. following completion (FY 2011) 12,855,193 $70,000,000 46,200,000 36,000,000 28,980,224 6,632,938 5,394,320 3,500,000 2,875,000 2,635,713 8,825,000 9,000,000 939,327 5,027,557 6,331,934 17,800,000 21,900,000 3,000,000 10,000 66,000,000 8,000,000 450,000 15,000,000 25,000,000 2,400,000 2,200,000 4,400,000 2,500,000 900,000 13,200,000 490,000 5,700,000 3,750,000 7,900,000 36,500,000 130,000 2,718,122 3,352,000 Average sales 2nd Yr. following completion (FY 2012) 53 108 118 185 145 64 28 18 14 19 38 30 19 89 45 124 80 22 1 163 28 12 65 45 35 5 30 25 2 79 4 31 21 65 151 2 19 42 Average employment at completion (FY 2010) 60 103 115 330 161 69 18 22 17 21 43 33 32 69 40 125 90 15 1 188 18 10 125 55 30 7 25 25 2 78 4 34 25 64 157 6 23 42 Average employment 1st Yr. following completion (FY 2011) 60 125 120 370 139 58 15 26 17 21 43 33 20 59 45 130 90 14 1 180 22 10 100 65 28 12 25 27 2 80 4 34 25 65 160 5 21 37 Average employment 2nd Yr. following completion (FY 2012) 191,328 $212,963 282,127 178,378 209,806 155,778 208,893 105,556 90,078 115,924 279,289 252,333 232,240 72,073 193,200 117,772 232,318 95,455 13,000 340,926 125,000 56,667 123,077 311,111 49,429 380,000 133,333 84,000 495,000 153,165 133,750 158,065 147,619 120,000 238,411 61,500 81,469 64,664 Average productivity at completion (FY 2010) 188,347 $390,291 304,348 115,152 221,724 129,988 265,489 115,170 122,616 125,510 255,349 256,242 218,262 82,570 140,763 116,800 243,333 205,667 6,000 341,314 148,889 44,000 104,000 181,818 65,833 300,000 164,000 84,000 475,000 156,410 125,000 164,706 144,000 120,313 216,561 23,000 108,727 74,759 Average productivity 1st Yr. following completion (FY 2011) 214,253 $560,000 385,000 97,297 208,491 114,361 359,621 134,615 169,118 125,510 205,233 272,727 46,966 85,213 140,710 136,923 243,333 214,286 10,000 366,667 363,636 45,000 150,000 384,615 85,714 183,333 176,000 92,593 450,000 165,000 122,500 167,647 150,000 121,538 228,125 26,000 129,434 90,595 Average productivity 2nd Yr. following completion (FY 2012) EXHIBIT 26—SALES, EMPLOYMENT, AND PRODUCTIVITY AT EACH FIRM UPON COMPLETION OF THE PROGRAM AND TWO-YEAR PERIOD FOLLOWING COMPLETION srobinson on DSK4SPTVN1PROD with 77236 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices 77237 towards the development and implementation of APs. Funds are not provided directly to firms; instead, EDA funds the TAACs and TAACs pay a proportion of the cost to secure specialized business consultants. production/manufacturing projects tend to be geared toward cutting costs. Support system projects can provide a competitive advantage by either cutting costs or creating new sales channels. Management and financial projects are designed to improve management’s decision making ability and business control. Over half of all firms proposed to implement a marketing/sales project or production/engineering project in their APs. Sample projects are listed below in Exhibit 28. 20 This does not include the amount expended by the TAACs for outreach to potential new firms. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 EN31DE12.012</GPH> In FY 2012, firms received $9.8 million in technical assistance provided by the TAACs to prepare petitions and to develop and implement APs (often through business consultants and other experts). Firms participating in the program contributed $6.3 million (16) The types of technical assistance included in the business recovery plans of firms participating in the program In FY 2012, firms proposed various types of projects in their APs. Marketing/sales projects are geared toward increasing revenue, whereas srobinson on DSK4SPTVN1PROD with (14) The financial assistance received by each firm participating in the program (15) The financial contribution made by each firm participating in the program 77238 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices EXHIBIT 28—CHARACTERISTICS OF TECHNICAL ASSISTANCE IN APS: FY 2012 Financial ........................................ Management ................................. Marketing/Sales ............................. Production ..................................... Support Systems ........................... • • • • • • • • • • • • • • • • Accounting systems upgrade ........................................................... Cost control tracking system Automatic Data Processing development. Strategic business planning ............................................................. Succession management Management development. Sales process training ...................................................................... Market expansion and feasibility Web site design and upgrade. Lean manufacturing and certification ............................................... New product development Production and warehouse automation. Enterprise Resource Planning ......................................................... Management Information Systems upgrades Computer Aided Design software Supply chain management software. (17) The number of firms leaving the program before completing the project or projects in their business recovery plans and the reason the project or projects were not completed In FY 2012, of the 145 firms that left the TAAF program, 84 completed the program, 34 did not complete approved projects in the time allotted, and the remaining 27 firms left for the reasons listed below in Exhibit 30. srobinson on DSK4SPTVN1PROD with Number of AP projects 21 Sample types of projects EXHIBIT 30—SUMMARY OF FIRMS LEAVING THE TAAF PROGRAM: FY 2012 Reason for leaving Program Bankruptcy Filing .......................... Completed TAAF Program ........... Expired without completing all projects within 5 year limit ........ Firm failed to submit AP within 2 years of TAAF certification ....... Firm opted out of program ........... Merger/Acquisition ........................ Out of business ............................ Number of firms 1 84 10 22:40 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4703 $216,000 30 549,166 103 3,984,800 93 3,490,944 65 2,230,000 EXHIBIT 30—SUMMARY OF FIRMS LEAVING THE TAAF PROGRAM: FY 2012—Continued Reason for leaving Program Owner deceased .......................... Sold Company .............................. Total .............................................. Number of firms 2 3 145 34 12 2 4 3 21 A firm may have up to five projects in an approval AP. VerDate Mar<15>2010 AP Project costs E:\FR\FM\31DEN2.SGM 31DEN2 EN31DE12.013</GPH> Project Classification Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices Western, New England, and New York State—focusing on the use of Federal funds provided by EDA. The OIG reported that it ‘‘did not determine that the level of administrative costs of the three TAACs to be unreasonable.’’ Indirect Costs, referred to as facilities and administrative (F&A) costs, include space rent and utilities, telephone, postage, printing, and other administrative costs. Universityaffiliated TAACs have indirect cost rate (ICR) agreements that cannot exceed the current rate negotiated with their 22 The information was requested in the House Committee Report that accompanied the FY 2012 cognizant Federal agency (non EDA/ DOC). These costs are captured on the indirect cost line item on the Application for Federal Assistance, SF– 424 (Form SF–424). Non-profit TAACs do not have ICR agreements; instead, they categorize similar expenditures in their ‘‘Other’’ line item of their Form SF–424. (19) The total amount expended by intermediary organizations to provide technical assistance to firms under the program nationally and in each region served by such an organization Commerce, Justice, Science, and Related Agencies Appropriations bill. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 PO 00000 Frm 00023 Fmt 4701 Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 EN31DE12.014</GPH> srobinson on DSK4SPTVN1PROD with (18) The total amount expended by all intermediary organizations referred to in Section 253(b)(1) and by each organization to administer the program On May 11, 2012, the Department of Commerce Office of Inspector General (OIG) presented EDA with a copy of their letter to the House and Senate Committees on Appropriations reporting their findings related to an examination of the TAAC administrative costs.22 As part of their review, OIG obtained expenditure data from a sample of three TAACs— 77239 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices In FY 2012, TAACs expended $10.7 million in technical assistance provided VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 to the firms in outreach to firms, to prepare petitions, and to develop and PO 00000 Frm 00024 Fmt 4701 Sfmt 4703 implement APs (often through business consultants and other experts). Funds E:\FR\FM\31DEN2.SGM 31DEN2 EN31DE12.015</GPH> srobinson on DSK4SPTVN1PROD with 77240 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices 77241 Exhibit 32: Summary of Expenditures— Technical Assistance to Firms by TAAC: FY 2012 certified 79 petitions and approved 102 APs. As of the end of FY 2012 (September 30, 2012), there are 889 active 23 firms participating in the TAAF program. EDA successfully met both the 40-day processing deadline (to make a final determination for petitions accepted for filing) and the 60-day processing deadline for approval of APs, as required in the TGAAA. In FY 2012, the average processing time for petitions was 29 business days, and the average processing time for APs was 21 business days. Firms that completed the TAAF program in FY 2010 report that average sales were $10.1 million, average employment was 53, and average sales per employee (productivity) was $191,328. One year after completing the program (FY 2011), these same firms reported that average sales increased by 11.4 percent, average employment increased by 13.2 percent, and average productivity decreased by 1.6 percent. For the sake of comparison to the universe of U.S. manufacturers, the U.S. Bureau of Labor Statistics (BLS) reported that, in FY 2011, the national manufacturing industry in aggregate experienced an average employment increase of only 1.9 percent meaning that firms who complete the program Through TAAF program, EDA effectively assisted many small and medium-sized firms in becoming more competitive and successful in the global economy. EDA considers the most significant finding in this report to be that following completion of assistance from EDA’s TAAF program, firms reported that, on average, sales increased by 26.8 percent, employment increased by 13.2 percent, and productivity increased by 11.9 percent. The TAAF program effectively assisted small and medium-sized firms in FY 2012. TAACs provided technical assistance to 341 firms in preparing petitions, 206 firms in preparing APs, and 935 firms in implementing projects for an approved AP. Meanwhile, EDA VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 23 A firm that has been certified for TAAF, and/ or has an approved Adjustment Proposal, has not completed all projects in their AP, and is still engaged in the TAAF program is considered ‘‘active.’’ PO 00000 Frm 00025 Fmt 4701 Sfmt 4703 E:\FR\FM\31DEN2.SGM 31DEN2 En31de12.016</GPH> the cost to secure specialized business consultants. Conclusion srobinson on DSK4SPTVN1PROD with are not provided directly to firms; instead, EDA funds the TAACs and TAACs pay a cost-shared proportion of srobinson on DSK4SPTVN1PROD with 77242 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices are more successful than firms generally. Two years after completing the program (FY 2012), these same firms reported that average sales increased by 26.8 percent, average employment increased by 13.2 percent, and average productivity increased by 11.9 percent. Meanwhile, BLS reported that the manufacturing industry in FY 2012 experienced an average employment increase of 3.5 percent and average productivity increase of 4.1 percent from FY 2010. Therefore, firms assisted by the TAAF program performed more successfully than the manufacturing industry as a whole. Additionally, all firms that completed the TAAF program in FY 2010 were in operation as of the end of FY 2012, indicating strong ‘‘survival rates’’ for TAAF-assisted firms. It should be noted that TAAF clients are operating in the same economic environment as other firms, but are also attempting to adjust to import pressures that may not impact other firms as severely, making the success of TAAF-assisted firms even more notable. On May 11, 2012, the Department of Commerce Office of Inspector General (OIG) presented EDA with a copy of their letter to the House and Senate Committees on Appropriations reporting their findings related to an examination of the TAAC administrative costs24. As part of their review, OIG obtained expenditure data from a sample of three TAACs— Western, New England, and New York State—focusing on the use of Federal funds provided by EDA. The OIG reported that it ‘‘did not determine that the level of administrative costs of the three TAACs to be unreasonable.’’ On September 13, 2012, the U.S. Government Accountability Office (GAO) published the report, Trade Adjustment Assistance: Commerce Program Has Helped Manufacturing and Services Firms, but Measures, Data, and Funding Formula Could Improve (GAO– 12–930). The GAO report documented the results of their independent analysis, which included strong evidence demonstrating the effectiveness of the TAAF program. GAO’s key finding was that for firms receiving assistance between FY 2008 and FY 2011, ‘‘the effect of participation in the program was an increase in firm sales ranging from 5 to 6 percent on average,’’ and that ‘‘the effect of the program on productivity was about a 4 24 The information was requested in the House Committee Report that accompanied the FY 2012 Commerce, Justice, Science, and Related Agencies Appropriations bill. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 percent increase.’’ As part of this study, GAO contacted 163 firms who had been involved with the TAAF program, and received responses from 117. As noted in the report, nearly all of the responding firms reported they were generally or very satisfied with the program. Manufacturing firms, specifically, reported that the program was associated with increased sales and productivity. Notably, an impressive 73 percent of the firms reported the program helped them with profitability, 71 percent said it helped them retain employees, and 57 percent reported that the program helped them hire new employees. EDA is currently implementing a performance measurement improvement process for all its programs, including TAAF, which began in late 2011 and consists of two phases: planning and development, and implementation. The one-year planning and development stage is expected to be completed in FY 2013. The first phase includes the following activities: researching and identifying improved metrics and indicators, testing the metrics and indicators across the full portfolio of EDA investments, and developing a work plan for implementing measures that are adopted. To assist with this effort, EDA has partnered with the University of North Carolina and George Washington University to develop draft performance measures utilizing state-ofthe-art performance measurement and program evaluation techniques. The subsequent implementation phase of the performance measurement improvement process will include the following activities: obtaining Office of Management and Budget approval of data collection forms, developing a database to store collected data, updating programmatic guidance and regulations, and examining the allocation formula used to distribute program funds to the TAACs in collaboration with both TAACs and Congressional stakeholders. The entire process is expected to be completed by the end of 2014. The performance measurement improvement process will help EDA be even a stronger partner to its clients and grantees. Through more effective program management and performance assessment, EDA will be in a better position to achieve the desired results for each of its programs. Supplement TAAF Program Benefits to Manufacturing Firms On September 13, 2012, the U.S. Government Accountability Office PO 00000 Frm 00026 Fmt 4701 Sfmt 4703 (GAO) published the report, Trade Adjustment Assistance: Commerce Program Has Helped Manufacturing and Services Firms, but Measures, Data, and Funding Formula Could Improve (GAO– 12–930). The GAO report documented the results of their independent analysis, which included strong evidence demonstrating the effectiveness of the TAAF program. GAO’s key finding was that for firms receiving assistance between FY 2008 and FY 2011, ‘‘the effect of participation in the program was an increase in firm sales ranging from 5 to 6 percent on average,’’ and that ‘‘the effect of the program on productivity was about a 4 percent increase.’’ As part of this study, GAO contacted 163 firms who had been involved with the TAAF program, and received responses from 117. As noted in the report, nearly all of the responding firms reported they were generally or very satisfied with the program. Manufacturing firms, specifically, reported that the program was associated with increased sales and productivity. Notably, an impressive 73 percent of the firms reported the program helped them with profitability, 71 percent said it helped them retain employees, and 57 percent reported that the program helped them hire new employees. Examples of TAAF Assistance Great Lakes Trade Adjustment Assistance Center (GLTAAC) This Michigan firm manufactures selfadhesive strip and sheet products for the automotive industry. The firm lost 38 percent of its sales in 2009 as demand disappeared and customers frantically switched to low cost foreign suppliers. It entered the TAAF program in 2010. The firm needed to improve its productivity and streamline its business processes. To accomplish this, replacing the firm’s antiquated Enterprise Resource Planning (ERP) system was paramount. After much research, the firm licensed a new system and used TAAF assistance to train the workforce in its use. The new ERP went live in January 2011, and the impact was immediate. Not only has it cut hardware costs and annual fees by 50 percent, it has also greatly reduced data input and handling time. The firm has been able to go virtually paperless, as documents are seamlessly handled and hardcopies are rarely required. Further, the new system is connected to its automotive forecasting service so that high-level sales forecasts are made automatically as customers release their model plans. Results of this ERP implementation have been truly transformative for the E:\FR\FM\31DEN2.SGM 31DEN2 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices srobinson on DSK4SPTVN1PROD with firm, resulting in ‘‘fabulous’’ performance, according to the firm’s CFO. As a result of this project and much hard work by the firm, it has been able to rehire many of the workers that were laid off in 2009. Though not yet fully recovered, the firm has now increased employment by 40 percent since entering the TAAF program. The firm currently employs about 90 workers and generates over $20 million in sales. The firm just started another worker training project via the program. An Ohio packaging firm was hit hard by rising import competition from China and other East Asian countries. Its customers were increasingly looking to cut costs by sourcing their packaging from abroad. This forced serious production cuts at the firm, which ultimately necessitated employee layoffs. The firm entered the TAAF program in early 2008. Its Adjustment Plan was approved in June of that year and included a wide range of needed improvements. The firm’s first projects included a detailed evaluation and restructuring of its sales team, as well as the development of much needed marketing materials. Improvements to its costing and quoting system were next, followed by a revamping of its Web site. The firm’s most recent TAAF project, completed in June 2012, was part of a major lean manufacturing initiative. Following classroom training financed in part by the State of Ohio, the TAAF program helped provide onsite employee training and hands-on coaching to jumpstart the firm’s productivity improvement efforts. This ‘‘last mile’’ project—the customized onsite lean training—had a huge impact on the overall success of the effort. The firm has made great progress to date— sales have rebounded significantly (up 50 percent from their low), and productivity is much improved. However, considerable work remains to be done. The firm is about to begin a project that will dramatically strengthen its finance function. By the time this firm completes the program, it will be positioned to thrive, not just survive. Mid-America Trade Adjustment Assistance Center (MamTAAC) A Missouri fabric-based products manufacturer has been receiving technical assistance funded by the TAAF program since December 2010. The first project included a comprehensive review of their pay scale compared with market salaries and wages. The intent of this project included addressing personnel issues and forming a strong cohesive team to bring the business out of the recession. The next project involved employee VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 training in the use of their Computer Aided Design software, which supported high investment equipment that enabled them to keep work inhouse and support additional employees to be added. A portion of the TAAF assistance enabled the firm to implement an International Organization for Standardization (ISO) compliant quality system and to subsequently become certified to ISO 9001:2008. The ISO certification has enabled the firm to increase sales to a major defense contractor by over 50 percent. This sales increase and business from new market segments have necessitated increasing employees by 15 percent. With the help of MamTAAC and TAAF-funded technical assistance, the firm has been able to build a manufacturing organization that can continue to effectively compete and grow. A Missouri wood products manufacturer has been enrolled in the program since 2004. In 2004, the firm had 16 employees and average revenue of $3 million and faced fierce competition with Chinese imports. TAAF funding allowed the firm to upgrade its management information systems, upgrade their ERP system, and purchase a production module to help with manufacturing data capture and tracking. Later, with technical assistance from MamTAAC, the firm leveraged TAAF program funds to provide human resources, employee, and executive training, which in addition to educating the firm’s leadership on sound business practices, allowed the owner to take actual business problems that were especially related to growth to a group of business owner peers for feedback. Today the firm has 36 employees with 6 more slated to be added in 2012, and revenues are projected to be above $8 million. The firm expects that by 2015, revenue will increase to $14 million and employment to 60. MidAtlantic Trade Adjustment Assistance Center (MATAAC) A Pennsylvania maker of pressure control devices for the fluid power and chemical industries was in its third year of declining sales, profits, and employment when awarded TAAFfunded technical assistance in 2008. Sales had fallen by 37 percent, profits had declined 67 percent and 8 percent of the employees were laid off as a direct result of imports. The company implemented projects in strategic planning, lean manufacturing, marketing communications, and six sigma. Since program entry, sales have improved by more than 20 percent, jobs have grown by 12 percent, earnings PO 00000 Frm 00027 Fmt 4701 Sfmt 4703 77243 have increased 42 percent, productivity has increased 7.5 percent, and return on human capital has grown 26.9 percent. As a direct consequence of this success, a world leader in the American fluid power industry acquired the firm in October 2012. A Pennsylvania manufacturer of industrial wear products for the construction and material handling industries had suffered a 25 percent drop in sales, an 83 percent reduction in earnings, an 81 percent decline in productivity and 13 percent of its employees had been separated—all over a 24-month period. A flood of imports impacted virtually all of the company’s products. Management recognized that its product line had been commoditized and that it could no longer compete on price alone. With projects addressing new product development, e-commerce and systems technology, the firm began to add value through superior design, cost mastery, and marketing. The firm was awarded TAAF-funded technical assistance in 2011. Since program entry, sales have grown by more than 50 percent, earnings have improved fivefold, productivity has increased more than 12 percent, jobs have grown 36 percent, and the return on the firm’s human capital has more than tripled. Midwest Trade Adjustment Assistance Center (MWTAAC) A Wisconsin manufacturer of custom solenoids was experiencing tough competition from Asian importers in the automotive, recreational vehicle, motorcycle, and industrial application markets. Several key customers moved their purchases to overseas providers with cheaper prices, resulting in a 21 percent decline in sales, forcing the firm to lay off workers. The firm was certified for TAAF in June 2010. The firm was able to enhance marketing tools with two projects in late 2010 that helped attract new domestic and international customers. In addition, the firm was able to cost-share export development assistance early in 2012, including research and marketing material translation. As a result of assistance from MWTAAC and TAAFfunded technical assistance, the manufacturer’s exports have grown dramatically and both sales and employment have increased over 90 percent in less than two years. A Minnesota manufacturer of commercial and residential air filtration systems received TAAF-funded technical assistance between 2008 and 2011 for export-related quality certifications, testing and marketing material translation. In addition, TAAF program technical assistance provided E:\FR\FM\31DEN2.SGM 31DEN2 77244 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices srobinson on DSK4SPTVN1PROD with Management Information System (MIS) enhancement and training which has allowed the company to manage the expansion and control costs. In the most recent year, the manufacturer has identified $77,659 of new export sales directly attributable solely to TAAF assistance. New England Trade Adjustment Assistance Center (NETAAC) A Connecticut metal finishing firm, the largest full-service metal finisher in the Northeast, experienced a significant decline in sales due to increased foreign competition and a shrinking domestic market. In 2010, the firm was certified for TAAF and with the assistance of NETAAC, prepared an AP to fund projects such as leadership training, a new Web site, upgraded marketing materials, establish lean manufacturing, and NADCAP, a critical certification that could potentially open many new markets for the firm. After merging with another local Connecticut firm, they are now able to service a much larger market providing full-service metal finishing services. As a result of TAAFfunded technical assistance, the firm has become stronger and more competitive, increasing sales by 20 percent and adding 20 more jobs. A Rhode Island full-service contract manufacturer serving a diverse group of customers including electronic manufacturers of medical instrumentation, military electronics, oceanographic instruments, and commercial products was adversely affected by a combination of growing foreign market competition and the global recession. In 2010, the firm was certified for TAAF and, with the assistance of NETAAC, prepared a business recovery plan (AP) to fund projects such as development of a strategic business plan, marketing and sales plan, MIS upgrades, and process improvement program. Within one year of TAAF-funded technical assistance, the firm has realized a 10 percent increase in employment and a 15 percent increase in sales. After successful realization of Lean Manufacturing and sales and marketing projects, the firm was able to capture new orders, increased the need for continuous improvement, and was able to lower cost of production by further streamlining their processes. The firm is now focusing on re-shoring efforts and committed to bringing jobs back to America. New York State Trade Adjustment Assistance Center (NYSTAAC) A New York manufacturer of precision optical fabrication machines VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 and systems was suffering from the adverse effects of foreign competition from Germany. The combination of the foreign competition, coupled with the recent downturn in the economy, significantly reduced the firm’s sales revenues. The firm needed to react to the continual loss of market share to foreign competition and did not have a formal strategic-based sales and marketing plan in place nor did it have the internal expertise to develop one. In order to effectively recover from the adverse effects of foreign competition, the firm sought technical assistance from NYSTAAC. At the time of TAAF certification, the firm had 35 full-time employees and annual sales of approximately $6 million. In order to stop the decline in sales and employment levels, the firm with assistance from NYSTAAC and TAAFfunded technical assistance, developed a business recovery plan (AP) that included a formal sales and marketing plan. In following the plan, the firm was able to achieve 85 percent growth in sales revenue to an annual rate of $12 million. This in turn has resulted in the firm adding 17 new employees since the implementation of the plan. An additional major outcome of the planning process was the recent expansion of the firm’s manufacturing facility to accommodate new business. A New York manufacturer of clipboards sought technical assistance from NYSTAAC to develop a business recovery plan (AP) to address inefficiencies with an outdated Management Information System (MIS) and production software, which when improved, would reduce deficits and increase productivity, resulting in higher output and increased sales. Since the firm was certified for TAAF in 2008, their sales have increased approximately $3.4 million and they have been able to maintain the same employment level. Northwest Trade Adjustment Assistance Center (NWTAAC) A Montana manufacturer of high performance laser diode and fiber optic control, test and measurement products used in research laboratories, telecommunication, and photonic production facilities received TAAF certification in 2005 based on a 74 percent increase in imports of these devices from China and Japan. Implementation of TAAF-funded projects such as extensive CE product testing, lean manufacturing and training, and sales market analysis and development over a 5 year period have resulted in firm product expansion into European markets, and increased PO 00000 Frm 00028 Fmt 4701 Sfmt 4703 penetration into China, Japan, and Korea. As a result of NWTAAC assistance and TAAF-funded technical assistance, as of the end of 2011, employment has stabilized and sales have increased 48 percent since certification, with export sales now comprising 50 percent of total sales, a 22 percent increase since entering the program. An Idaho light duty manufacturer of sheet metal and plastic ventilation and roofing components was certified for TAAF in 2010 based on a 20 percent decline in sales resulting from increased imports from China, Canada, and Mexico. TAAF-funded technical assistance projects thus far have included Web site redesign and a two-phased search engine optimization project. As a result of these projects the firm has gone from zero exports and internet orders to over 300 new orders per month to customers all over the U.S. and Canada with about 75 percent of the orders coming from repeat customers. This increase in sales of $400,000 from two years ago provides better profit margins with 10-to-15 percent of the sales going to Canada. The firm has also increased employment by about 2.5 full time employees and is about to add another just for parcel packaging for the internet orders. As an added benefit, this new nationwide customer base gives this firm a better idea of what people want, and these sales are much more profitable than their wholesale business. Rocky Mountain Trade Adjustment Assistance Center (RMTAAC) Faced with intense foreign competition and an increasingly competitive market, a Utah manufacturer of plastic folding tables and chairs contacted RMTAAC in 2010 for assistance to improve the firm’s competitive position. RMTAAC conducted a thorough business assessment and competitive analysis to identify strategic areas for improvement to build a more solid foundation for future growth. The firm was awarded technical assistance through the TAAF program to target cost reductions in its manufacturing processes. The firm has been able to utilize TAAF-funded technical assistance to shift its efforts to a firm-wide lean manufacturing initiative. The firm implemented lean manufacturing to reduce wasteful or non-value added activities in the manufacturing process. The firm has seen a 25 percent reduction in inventory carrying costs since applying lean manufacturing principles. In addition, the firm’s sales are up 27 percent since E:\FR\FM\31DEN2.SGM 31DEN2 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices srobinson on DSK4SPTVN1PROD with entering the TAAF program two years ago. A South Dakota manufacturer of industrial cleaning machinery had noted increased competition from foreign countries. Over the last decade, consolidation has been a significant trend in the industrial machinery industry. As larger multi-national conglomerates have gained scale in their operations through acquisitions, the competitive challenges continue to mount for smaller manufacturers in the industry. The firm contacted RMTAAC in 2010 for assistance with TAAF certification. Upon certification, RMTAAC worked with the firm to develop a customized business recovery plan (AP) focused on implementing strategic improvements to strengthen the firm’s competitiveness in the global marketplace. Between July 2011 and December 2011, the firm developed a customized sales and marketing program. To date, the firm’s sales have increased 18.8 percent from the previous year, and the quote-to-order conversion rate has increased 7 percent. As a result of TAAF-funded technical assistance, the firm’s sales are at a 72year high. Southeastern Trade Adjustment Assistance Center (SETAAC) After losing sales to a major customer in 2000, a Georgia manufacturing firm ended an era of selling a complete textile machine to a U.S. customer. The impact of low-cost textile imports from China and Mexico was devastating the firm’s domestic customers. In 2006, as sales and employment continued to decline, the firm turned to the TAAF program for help. The SETAAC team developed a customized business recovery plan (AP) which focused on planning and implementing strategic improvements to strengthen the firm’s competitiveness in the global marketplace. With TAAF-funded technical assistance, the firm received certification from the Historically Underutilized Business Zone (HUBZone) program, which helps small businesses in urban and rural communities gain access to Federal procurement opportunities. The firm also redesigned its Web site and other marketing materials in order to appeal to a broader client base. The work paid off, as the firm now provides an ammunition testing system for the Air Force. As a result of TAAF-funded technical assistance, the firm has increased employment by 37 percent and revenue by 10 percent. At the end of the first quarter of 2012, the firm was on track for a 25 percent increase in revenue over 2011. VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 Based in South Carolina, a producer of screens for rotary screen textile printing experienced a 22 percent loss in sales from 2008 to 2009 as a result of Chinese competitors. To address the issue of foreign competition, the firm applied for and was certified for TAAF in 2009. The SETAAC team outlined key projects to help the firm increase its competitive edge. With consultants from the South Carolina Manufacturing Extension Partnership (SCMEP), the firm was able to transition from textilebased screen engraving to digital printing of designs directly to fabric by using a new brand. Projects performed by the SCMEP included Web site redesign, organic search engine optimization, lead generation and payper-click advertising. This outreach lead the firm to an opportunity with a large promotional and graphic communications firm with over 750 member locations in the U.S. and Canada. Since the initiation of this project, annual sales have steadily increased by over $220,000. May 2012 saw a 50 percent sales increase, and June 2012 as the highest sales month in four years. In addition to increasing sales, the firm has also added three additional employees. Southwest Trade Adjustment Assistance Center (SWTAAC) A Texas manufacturer of uniforms, industrial safety, and rehabilitation equipment was certified for TAAF in 2008. The firm had experienced a 21 percent decline in sales and 31 percent decline in employment since the previous year. The foreign impact was traced to imports from China, Bangladesh, Indonesia, Mexico and the Caribbean basin countries. The firm received EDA approval of an AP focusing on technical assistance in the areas of strategic marketing, Enterprise Resource Planning (ERP) implementation, and lean manufacturing techniques. To date, the firm has worked on four marketing projects, which included photography of their products, a complete redesign of their marketing materials such as catalogs, brochures, and press packages, along with product imaging improvements and a branding strategy. Management information systems projects integrated the firm’s MAS 200 SAGE accounting software to interface with their Web site projects to streamline and improve the functionality of accounting, inventory control, on-line customer ordering accessible year round (24 hours a day) with the capability to track orders by oilrig number/employee, and create automated customized reports. The firm PO 00000 Frm 00029 Fmt 4701 Sfmt 4703 77245 has completed 99 percent of their projects and seen a dramatic increase in sales. They recorded sales of $20.9 million in 2011 and an employment of 30, an increase of 345 percent and 25 percent respectively since the date of certification. A Louisiana manufacturer of Creole pralines and a variety of other pecanbased confections was adversely impacted by imports from Canada, Mexico, and Thailand. The firm was certified for TAAF in May 2009. At the time of certification, annualized sales were approximately $2.7 million, down from $3.3 million the previous year. The firm AP project plans included a support system upgrade required to make significant Management Information System (MIS) upgrades. Although they had an MIS system, it did not have the capacity to allow the firm to manage their increasingly diversifying business. Although implementation of the projects outlined in their business recovery plan is ongoing, the firm has fared better than many other firms that are recovering from the aftermath of not only Hurricane Katrina, but also the generalized impact of the recession during this period. Annual sales two years from the date of certification grew to $3.6 million—an annualized growth rate of roughly 15 percent. Western Trade Adjustment Assistance Center (WTAAC) A California custom packaging manufacturer serving customers in the medical, food, and electronics industries suffered injury from import competition from Asia from 2004 through 2006. Its customers increased the purchase of packaging solutions made in the Pacific Rim. A severe downturn in the static packaging industry resulted in the Pacific Rim producing the bulk share of electronic components. The firm was certified for TAAF in December of 2006. WTAAC and the firm’s management developed a strategy to change the way the customers think about flexible barrier packaging and to provide new ideas to industry to use this packaging. Specifically, the goal was to develop innovative ways of using barrier packaging to enter the advertising niche, a market segment that has not previously used flexible packaging. The firm completed the implementation phase of the TAAF program in January 2010. While active in the program, the firm implemented its marketing project and two information technology projects. Since TAAF certification, sales increased 34 percent, employment increased 28 percent, profitability E:\FR\FM\31DEN2.SGM 31DEN2 77246 Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 / Notices srobinson on DSK4SPTVN1PROD with increased 68 percent, and productivity increased 4 percent. A second-generation California bonding wedge manufacturer, specializing in the design and manufacture of bonding wedges for the microelectronics industry was suffering from continued shrinking market share due to increasing competition from low price Pacific Rim manufacturers from 2000 to 2002. As a result, 2002 annual sales decreased 44 percent and employment decreased 34 percent. The firm was certified for TAAF in October of 2002. WTAAC and the firm’s VerDate Mar<15>2010 22:17 Dec 28, 2012 Jkt 229001 management developed a strategy for the firm to specialize in the manufacture of high quality bonding wedges for the microelectronic industry while expanding its brand sales and diversifying its customer base. The firm successfully completed the implementation phase of the TAAF program in February 2009. While active in the program, the firm implemented two quality management system projects, three production engineering projects, four marketing and promotion projects, and one information PO 00000 Frm 00030 Fmt 4701 Sfmt 9990 technology project. These projects focused on significantly expanding international sales while improving manufacturing efficiency, reducing production cost and shortening cycle times. Since TAAF certification, the firm regained profitability, with sales increasing 45 percent, and productivity improving 45 percent. Dated: December 21, 2012. Miriam Kearse, Eligibility Examiner. [FR Doc. 2012–31377 Filed 12–28–12; 8:45 am] BILLING CODE 3510–WH–P E:\FR\FM\31DEN2.SGM 31DEN2

Agencies

[Federal Register Volume 77, Number 250 (Monday, December 31, 2012)]
[Notices]
[Pages 77217-77246]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-31377]

[[Page 77217]]

Vol. 77

Monday,

No. 250

December 31, 2012

Part III

Department of Commerce

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Economic Development Administration

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Fiscal Year 2012 Annual Report to Congress on the Trade Adjustment
Assistance for Firms Program; Notice

Federal Register / Vol. 77, No. 250 / Monday, December 31, 2012 /
Notices

[[Page 77218]]

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DEPARTMENT OF COMMERCE

Economic Development Administration

Fiscal Year 2012 Annual Report to Congress on the Trade
Adjustment Assistance for Firms Program

AGENCY: Economic Development Administration, Department of Commerce.

ACTION: Notice .

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Pursuant to 255A of chapter 3 of title II of the Trade Act of 1974,
as amended (19 U.S.C. 2341 et seq.), the Economic Development
Administration (EDA) publishes the Fiscal Year 2012 Annual Report to
Congress on the Trade Adjustment Assistance for Firms program.
BILLING CODE 3510-WH-P

[[Page 77219]]

[GRAPHIC] [TIFF OMITTED] TN31DE12.005

[[Page 77220]]

Key Findings

In September 2012, the U.S. Government Accountability Office (GAO)
reported to Congress that the effect of participation by import-
impacted U.S. firms in the Trade Adjustment Assistance for Firms (TAAF)
program was an increase in firm sales ranging from 5 to 6 percent on
average,'' and that ``the effect of the program on productivity was
about a 4 percent increase.'' \1\ GAO also noted in the report that
manufacturing firms, specifically, associate the TAAF program with
increased sales and productivity.
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\1\ U.S. Government Accountability Office (GAO), Trade
Adjustment Assistance: Commerce Program Has Helped Manufacturing and
Services Firms, but Measures, Data, and Funding Formula Could
Improve (GAO-12-930), September 13, 2012.
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Meanwhile, this report--EDA's Annual Report to Congress on the TAAF
program--finds that, two years after completing the program in FY 2010,
participating firms experienced an average employment increase of 13.2
percent, an average sales increase of 26.8 percent, and an average
productivity increase of 11.9 percent. For the sake of comparing TAAF-
assisted firms to non-assisted similar firms, the Department of Labor's
Bureau of Labor Statistics (BLS) reported that, in FY 2012, the
manufacturing industry as a whole experienced an average employment
increase of only 3.5 percent and an average productivity increase of
4.1 percent from FY 2010.\2\.
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\2\ BLS does not collect a sales measure comparable to EDA's
measure in this report (i.e. average sales per employee).
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Therefore, both GAO and EDA find that the TAAF program has a
significant positive impact in helping import-impacted U.S. firms
compete in the global marketplace. Additionally, all firms that
completed the TAAF program in FY 2010 were in operation at the end of
FY 2012, indicating strong survival rates for TAAF-assisted firms.
Furthermore, on May 11, 2012, the Department of Commerce Office of
Inspector General (OIG) presented EDA with a copy of their letter to
the House and Senate Committees on Appropriations reporting their
findings related to an examination of the TAAC administrative costs.\3\
As part of their review, OIG obtained expenditure data from a sample of
three TAACs--Western, New England, and New York State--focusing on the
use of Federal funds provided by EDA. The OIG reported that it ``did
not determine that the level of administrative costs of the three TAACs
to be unreasonable.'' Therefore, not only does the TAAF program produce
results--it does so at reasonable costs.
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\3\ The information was requested in the House Committee Report
that accompanied the FY 2012 Commerce, Justice, Science, and Related
Agencies Appropriations bill.
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Background

This annual report is submitted in accordance with Section 255A of
chapter 3 of title II of the Trade Act of 1974, as amended (19 U.S.C.
2341 et seq.) (commonly referred to as the Trade Act). Section 255A of
the Trade Act directs the Secretary of Commerce to submit an annual
report on the Trade Adjustment Assistance for Firms (TAAF) program to
Congress no later than December 15, 2012 and each year thereafter. The
TAAF program is authorized by chapters 3 and 5 of title II of the Trade
Act.
Administered by the U.S. Department of Commerce's Economic
Development Administration (EDA), the goal of the TAAF program is to
help economically distressed U.S. businesses develop strategies to
compete in the global economy. Through a partnership with a national
network of 11 EDA-funded Trade Adjustment Assistance Centers (TAACs),
the program provides cost-sharing technical assistance to help eligible
businesses create and implement targeted business recovery plans
(referred to as ``Adjustment Proposals'' or ``APs'') aimed at boosting
global competitiveness, increasing sales and retaining and creating
jobs. The TAACs, which are either independent or university-affiliated
entities, provide support to import-impacted firms in a public-private
collaborative framework. The TAAF program provides a portion of the
assistance while participating firms contribute a matching share to
create and implement their recovery plans.
EDA's partnership with the TAAC network across the country allows
firms to receive customized assistance from highly qualified experts
who are knowledgeable about the needs, challenges and opportunities
facing the industries in their region. The most common types of
assistance provided in FY 2012 were marketing/sales improvement and
production/engineering projects, which comprised over half of all
projects supported throughout the year.
In January 2011, as authorization of the Trade Adjustment
Assistance (TAA) programs at the U.S. Department of Labor (DOL), U.S.
Department of Agriculture (USDA) and EDA was about to expire, Congress
passed the Omnibus Trade Act of 2010 (Pub. L. 111-344). This Act
extended the TAAF program through February 12, 2012, but allowed some
provisions--such as eligibility for service firms and expanded time
periods for qualifying firm eligibility--provided under the Trade and
Globalization Adjustment Assistance Act of 2009 (TGAAA) to expire on
February 13, 2011.\4\ The TAAF program remained authorized in FY 2011
and continued to operate at FY 2010 spending levels of $15.8 million
under a full-year continuing resolution, which prevented interruption
of program operations.
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\4\ The TGAAA was included as subtitle I (letter ``I'') of title
I of Division B of the American Recovery and Reinvestment Act of
2009 (ARRA) (Pub. L. 111-5, Stat. 115 at 367).
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On October 21, 2011, the President signed into law the Trade
Adjustment Assistance Extension Act of 2011 (Pub. L. 112-40). This Act
retroactively extended the provisions of the TAA programs that were
enacted as part of the TGAAA.
The expiration of the TGAAA provisions did, however, limit the
number of firms entering the program as TAACs were unable to assist
service firms or use extended ``look-back periods'' to certify firms.
In addition, uncertainty regarding the TAAF program's future caused
TAACs to focus on existing clients instead of recruiting new firms.
As part of its overall commitment to performance evaluation and
continuous improvement, EDA assesses the performance of the TAAF
program both in terms of ``inputs'' (e.g., types of firms assisted,
petition, and AP submissions) and ``outputs'' (changes in sales,
employment levels, and productivity of client firms).
In terms of inputs, the TAAF program effectively targeted small and
medium-sized firms in FY 2012. TAACs provided technical assistance to
341 firms in preparing petitions, 206 firms in preparing APs, and 935
firms in implementing projects within their APs. Meanwhile, EDA
certified 79 petitions and approved 102 APs.
EDA successfully met both the 40-day processing deadline (to make a
final determination for petitions accepted for filing) and the 60-day
processing deadline for approval of APs, as required in the TGAAA. In
FY 2012, the average processing time for petitions was 29 business
days, and the average processing time for APs was 21 business days.
In order to assess the effectiveness of the TAAF program in terms
of outputs, EDA assesses the extent to which client firms increased
their sales, employment levels, and productivity following the
implementation of TAAF-supported

[[Page 77221]]

projects (program completion). To measure these outputs, EDA compares
average sales, average employment and average productivity of all firms
completing the program in a particular year (the most recent ``base
year'') to these same measures for the same firms one and two years
following program completion. The base year used for this report is FY
2010, as this allows EDA to compare these measures looking back both
one and two years from the date of this report.
Firms that completed the TAAF program in FY 2010 report that, at
completion, average sales were $10.1 million, average employment was 53
and average sales per employee (productivity) was $191,328. One year
after completing the program (FY 2011), these same firms reported that
average sales increased by 11.4 percent, average employment increased
by 13.2 percent, and average productivity decreased by 1.6 percent. For
the sake of comparison to the universe of U.S. manufacturers, the U.S.
Bureau of Labor Statistics (BLS) reports that, in FY 2011, the national
manufacturing industry in aggregate experienced an average employment
increase of only 1.9 percent.
Two years after completing the program (FY 2012), these same firms
reported that average sales increased by 26.8 percent, average
employment increased by 13.2 percent, and average productivity
increased by 11.9 percent. Meanwhile, BLS reported that the
manufacturing industry in FY 2012 experienced an average employment
increase of 3.5 percent and average productivity increase of 4.1
percent from FY 2010. Therefore, firms assisted by the TAAF program
performed more successfully than the manufacturing industry as a whole.
Additionally, all firms that completed the TAAF program in FY 2010 were
in operation as of the end of FY 2012, indicating strong survival rates
for TAAF-assisted firms. It should be noted that TAAF clients are
operating in the same economic environment as other firms, but are also
attempting to adjust to import pressures that may not impact other
firms as severely, making the success of TAAF-assisted firms even more
notable.

Table of Contents

Introduction
Program Description
Results/Findings
Data for This Report

(1) The number of firms that inquired about the program.
(2) The number of petitions filed under section 251.
(3) The number of petitions certified and denied by the
Secretary.
(4) The average time for processing petitions after the
petitions are filed.
(5) The number of petitions filed and firms certified for each
Congressional District in the United States.
(6) Of the number of petitions filed, the number of firms that
entered the program and received benefits.
(7) The number of firms that received assistance in preparing
their petitions.
(8) The number of firms that received assistance developing
business recovery plans.
(9) The number of business recovery plans approved and denied by
the Secretary.
(10) Average duration of benefits received under the program
nationally and in each region served by an intermediary organization
(the TAAC) referred to in section 253(b)(1) of the Trade Act.
(11) Sales, employment, and productivity at each firm
participating in the TAAF program at the time of certification.
(12) Sales, employment, and productivity at each firm upon
completion of the program and each year for the two-year period
following completion.
(13) The number of firms in operation as of the date of this
report and the number of firms that ceased operations after
completing the program in each year during the two-year period
following completion of the program.
(14) The financial assistance received by each firm
participating in the program.
(15) The financial contribution made by each firm participating
in the program.
(16) The types of technical assistance included in the business
recovery plans of firms participating in the program.
(17) The number of firms leaving the program before completing
the project or projects in their business recovery plans and the
reason the project or projects were not completed.
(18) The total amount expended by all intermediary organizations
referred to in Section 253(b)(1)and by each organization to
administer the program.
(19) The total amount expended by intermediary organizations to
provide technical assistance to firms under the program nationally
and in each region served by such an organization.
Conclusion
Supplement--TAAF Program Benefits to Manufacturing Firms

Introduction

This report is provided in compliance with Section 255A of chapter
3 of title II of the Trade Act. Section 255A of the Trade Act directs
the Secretary of Commerce to provide an annual report on the Trade
Adjustment Assistance for Firms (TAAF) program by the 15th of December.
Section 255 of the Trade Act states:

IN GENERAL.--Not later than December 15, 2012, and annually
thereafter, the Secretary shall prepare a report containing data
regarding the trade adjustment assistance for firms program under
this chapter for the preceding fiscal year. The data shall include
the following:

This report will provide findings and results classified by
intermediary organization,\5\ state, and national totals,\6\ to the
extent that the data are available on the following 19 measures:
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\5\ ``Intermediary Organization'' referred to in section
253(b)(1) are the Trade Adjustment Assistance Centers (TAACs).
\6\ See chapter 3 of title II of the Trade Act, section 255A (b)
Classification of Data.
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1. The number of firms that inquired about the program.
2. The number of petitions filed under section 251.
3. The number of petitions certified and denied by the Secretary.
4. The average time for processing petitions after the petitions
are filed.
5. The number of petitions filed and firms certified for each
Congressional district of the United States.
6. Of the number of petitions filed, the number of firms that
entered the program and received benefits.
7. The number of firms that received assistance in preparing their
petitions.
8. The number of firms that received assistance developing business
recovery plans.
9. The number of business recovery plans approved and denied by the
Secretary.
10. The average duration of benefits received under the program
nationally and in each region served by an intermediary organization
referred to in section 253(b)(1) of the Trade Act.
11. Sales, employment, and productivity at each firm participating
in the TAAF program at the time of certification.
12. Sales, employment, and productivity at each firm upon
completion of the program and each year for the two-year period
following completion.
13. The number of firms in operation as the date of the report and
the number of firms that ceased operations after completing the program
and in each year during the two-year period following completion of the
program.
14. The financial assistance received by each firm participating in
the program.
15. The financial contribution made by each firm participating in
the program.
16. The types of technical assistance included in the business
recovery plans of firms participating in the program.
17. The number of firms leaving the program before completing the
project or projects in their business recovery plans and the reason the
project was not completed.
18. The total amount expended by all intermediary organizations
referred to in

[[Page 77222]]

Section 253(b)(1) and by each organization to administer the program.
19. The total amount expended by intermediary organizations to
provide technical assistance to firms under the program nationally and
in each region served by such an organization.

Program Description

The TAAF program is authorized by chapters 3 and 5 of title II of
the Trade Act. The responsibility for administering the TAAF program is
delegated to EDA by the Secretary of Commerce. The TAAF program
provides technical assistance to manufacturers and service firms
affected by import competition in order to help them develop and
implement projects to regain global competitiveness, increase
profitability and create jobs.
The mission of the TAAF program is to help U.S. firms regain
competitiveness in the global economy. Import-impacted U.S.
manufacturing, production and service firms can receive matching funds
for projects that expand markets, strengthen operations and increase
competitiveness through the TAAF program. The program provides
assistance to support the development of business recovery plans
(commonly referred to as ``Adjustment Proposals or ``APs''), under
Section 252 of the Trade Act, and matching funds to implement projects
outlined in the APs.
The TAAF program supports a national network of 11 independent non-
profit or university-affiliated TAACs to help U.S. manufacturing,
production, and service firms in all 50 States, the District of
Columbia and the Commonwealth of Puerto Rico. Firms work with the TAACs
to apply for certification of eligibility for TAAF assistance, and
prepare and implement strategies to guide their economic recovery.

Exhibit 1--TAACs and Their Respective Service Areas
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TAAC Service areas
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Great Lakes........................... Indiana, Michigan and Ohio.
Mid-America........................... Arkansas, Kansas and Missouri.
Mid-Atlantic.......................... Delaware, District of Columbia,
Maryland, New Jersey,
Pennsylvania, Virginia and West
Virginia.
Midwest............................... Illinois, Iowa, Minnesota and
Wisconsin.
New England........................... Connecticut, Maine,
Massachusetts, New Hampshire,
Rhode Island and Vermont.
New York State........................ New York.
Northwest............................. Alaska, Idaho, Montana, Oregon
and Washington.
Rocky Mountain........................ Colorado, Nebraska, New Mexico,
North Dakota, South Dakota,
Utah and Wyoming.
Southeastern.......................... Alabama, Florida, Georgia,
Kentucky, Mississippi, North
Carolina, South Carolina,
Tennessee and the Commonwealth
of Puerto Rico.
Southwest............................. Louisiana, Oklahoma and Texas.
Western............................... Arizona, California, Hawaii and
Nevada.
------------------------------------------------------------------------

The TAAF program is one of four distinct programs authorized under
the Trade Act. The other TAA programs are TAA for Workers and TAA for
Community Colleges, which are both administered by DOL, and TAA for
Farmers, which is administered by USDA.
[GRAPHIC] [TIFF OMITTED] TN31DE12.006

Program Initiative

As noted above, the TAAF program provides technical assistance to
help firms develop and implement business recovery plans, or APs.
Projects identified in the AP are designed to improve a firm's
competitive position. Specifically, under the TAAF program, funds are
applied toward helping firms access consultants, engineers, designers
or industry experts to implement business improvement projects. These
projects may cover a range of functional areas to improve a firm's
market position and increase its overall competitiveness, including
engineering, information technology, management, market development,
marketing, new product development, quality improvement and sales.
Funds are not provided directly to firms; instead, EDA funds TAACs and
TAACs use funds to pay a cost-shared proportion of the cost to secure
specialized business consultants.

[[Page 77223]]

[GRAPHIC] [TIFF OMITTED] TN31DE12.007

There are three main phases to receiving technical assistance under
the TAAF program: (1) petitioning for certification, (2) recovery
planning and (3) AP implementation.

Phase I--Petitioning for Certification

The first step to receiving assistance is the submission of a
petition to EDA to be certified as a trade-impacted firm. A petition is
comprised of Form ED-840P, titled ``Petition by a Firm for
Certification of Eligibility to Apply for Trade Adjustment
Assistance,'' and required supporting documentation. Generally,
certification specialists in the TAACs work with the firm at no cost to
complete and submit a petition to EDA.
Upon receipt of the petition, EDA performs an analysis of the
petition and supporting documents to determine if the petition is
complete and may be accepted. EDA is required to make a final
determination on the petition within 40 days of accepting a
petition.\7\
---------------------------------------------------------------------------

\7\ As of May 17, 2009, the deadline for making a final
determination is 40 days. Before May 17, 2009, EDA had 60 days to
make a determination.
---------------------------------------------------------------------------

To certify a firm as eligible to apply for adjustment assistance,
the Secretary must determine that the following three conditions are
met:
1. A significant number or proportion of the workers in the firm
have been or are threatened to be totally or partially separated;
2. Sales and/or production of the firm have decreased absolutely,
or sales and/or production of an article or service that accounted for
at least 25 percent of total production or sales of the firm during the
12, 24, or 36 months preceding the most recent 12-, 24-, or 36-month
period for which data are available have decreased absolutely; and
3. Increased imports of articles like or directly competitive with
articles produced or services provided by the firm have ``contributed
importantly'' to both the layoffs and the decline in sales and/or
production.

Phase II--Recovery Planning

Certified firms then work with TAAC staff to develop a customized
AP for submission to EDA for approval. Once an AP has been submitted,
EDA is required to make a final determination within 60 days.

Phase III--AP Implementation

The firm works with consultants to implement projects in an
approved AP. As projects are implemented and if the firm is satisfied
with the work, the firm will first pay their match to the consultant,
and then send a notice to the TAAC stating that they are satisfied with
the work and that they have paid their matching share. The TAAC will
then pay the Federal matching share. Firms have up to five years from
the date of an AP's approval to implement the approved business
recovery strategy contained therein, unless they receive approval for
an extension. Generally, firms complete the implementation of their
respective APs over a two-year period.
In general, the TAACs provide an array of services to assist
import-impacted firms throughout this process, including:
Assisting firms in preparing their petitions for TAAF.
Firms are not charged for any assistance related to the preparation of
a petition.
Once a petition has been approved, TAACs work closely with
a firm's management to identify the firm's strengths and weaknesses and
develop a customized business strategy (AP) designed to foster
competitiveness. The program pays up to 75% of the cost of developing
an AP and the firm must pay the rest. EDA must approve all APs to
ensure they conform to statutory and regulatory requirements.
After an AP has been approved, company management and TAAC
staff jointly identify consultants with the specific expertise required
to assist the firm in implementing their competitiveness strategy.
Under the TAAF program, EDA shares the cost of
implementing tasks under an approved AP to support competitiveness. For
an AP in which proposed tasks total $30,000 or less, EDA provides up to
75 percent of the cost and the firm is responsible for the balance. For
an AP in which proposed tasks total over $30,000, EDA pays 50 percent
of the total cost and the firm pays the remaining 50 percent. In order
to most efficiently and effectively utilize limited program funds, EDA
limits its share of technical assistance to a certified firm to no more
than $75,000. After a competitive procurement process, the TAAC and the
firm generally contract with private consultants to implement the AP.

Results/Findings

Data for This Report

The data used in this report were collected from the TAACs as part
of their reporting requirements, petitions for certification, and the
APs submitted by the TAACs on behalf of firms. Eligibility Reviewers at
EDA recorded data from these sources into a central database. The data
presented in this report has been verified by the TAACs. Results for
average processing times were derived by EDA. Data in this report
reflect data as of the end of FY 2012. Therefore, data in this Annual
Report may differ from previously published data that were based on
different periods.

(1) The Number of Firms That Inquired About the Program

In FY 2012, the TAACs received 1,849 inquiries about the program.

Exhibit 4: Inquiries about the TAAF program by TAAC

------------------------------------------------------------------------
No. of
firms that
inquired
TAAC about the
TAAF
program
------------------------------------------------------------------------
Great Lakes................................................ 65

[[Page 77224]]

Mid-America................................................ 140
Mid-Atlantic............................................... 79
Midwest.................................................... 49
New England................................................ 34
New York State............................................. 79
Northwest.................................................. 81
Rocky Mountain............................................. 263
Southeastern............................................... 53
Southwest.................................................. 390
Western.................................................... 616
------------
Total.................................................... 1,849
------------------------------------------------------------------------

(2) The number of petitions filed under section 251
(3) The number of petitions certified and denied by the Secretary
(4) The average time for processing petitions after the petitions
are filed
As part of its overall commitment to performance evaluation and
continuous improvement, EDA assesses the performance of the TAAF
program both in terms of ``inputs'' (e.g., types of firms assisted,
petition, and AP submissions) and ``outputs'' (changes in sales,
employment levels, and productivity of client firms).
In terms of inputs, the TAAF program effectively targeted small and
medium-sized firms in FY 2012. EDA received 85 petitions, of which 83
were filed (accepted for investigation) under section 251 of the Trade
Act, down by 46 petitions, a 36 percent decrease, compared to the
number of petitions filed in FY 2011. EDA certified 79 petitions, down
by 70 petitions, a 47 percent decrease compared to the number of
certifications in FY 2011.\8\ Petitions are certified on a rolling
basis throughout the year. Petitions certified in FY 2012 may be the
result of those received or filed (accepted) in FY 2011, while
petitions received or filed (accepted) in FY 2012 may not result in
certification in FY 2012.
---------------------------------------------------------------------------

\8\ Some TAACs believe that fewer firms were eligible to
participate in the program because the economy's improvement from FY
2010 and FY 2011 prevented some firms from demonstrating a decrease
in employment, sales and production required for eligibility.
---------------------------------------------------------------------------

EDA met the 40-day processing deadline (to make a final
determination for petitions accepted for filing) in FY 2012. In fact,
the average processing time for petitions was 29 business days.
---------------------------------------------------------------------------

\9\ Petitions are certified on a rolling basis throughout the
year, therefore activity in these categories may not result in
certification within the same FY. These totals represent the
activity under each category within FY 2012.

Exhibit 5--Petition Activity: FY 2008--FY 2012 \9\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Average days
Number of Number of Number of Number of between Average days
FY petitions petitions petitions petitions denied acceptance between receipt
received accepted for certified or withdrawn (filing) and and
filing certification certification
--------------------------------------------------------------------------------------------------------------------------------------------------------
2008........................................ 186 189 182 0 35 43
2009........................................ 276 243 216 1 30 51
2010........................................ 311 329 330 0 31 74
2011........................................ 128 129 149 22 21 36
2012........................................ 85 83 79 3 29 58
-----------------------------------------------------------------------------------------------------------
% Change (2011 to 2012)..................... (34%) (36%) (47%) (86%) 38% 61%
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 77225]]

[GRAPHIC] [TIFF OMITTED] TN31DE12.008

[[Page 77226]]

Exhibit 9--Petitions Received, Accepted (Filed) and Certified by TAAC: FY 2012
----------------------------------------------------------------------------------------------------------------
Number of
Number of petitions Number of
TAAC petitions accepted for petitions
received filing certified
----------------------------------------------------------------------------------------------------------------
Great Lakes............................................... 5 5 5
Mid-America............................................... 2 2 2
MidAtlantic............................................... 11 10 6
Midwest................................................... 19 19 20
New England............................................... 9 10 10
New York State............................................ 7 7 6
Northwest................................................. 8 8 6
Rocky Mountain............................................ 8 9 10
Southeastern.............................................. 2 2 1
Southwest................................................. 9 9 11
Western................................................... 5 2 2
-----------------------------------------------------
Total................................................. 85 83 79
----------------------------------------------------------------------------------------------------------------

[GRAPHIC] [TIFF OMITTED] TN31DE12.009

Exhibit 11--Petitions Filed, Accepted, and Certified by TAAC/State: FY 2012
----------------------------------------------------------------------------------------------------------------
Petitions
TAAC/State Petitions accepted for Petitions
received filing certified
----------------------------------------------------------------------------------------------------------------
Great Lakes............................................... 5 5 5
IN.................................................... 0 0 0
MI.................................................... 3 3 3
OH.................................................... 2 2 2
Mid-America............................................... 2 2 2
AR.................................................... 0 0 0
KS.................................................... 1 1 1
MO.................................................... 1 1 1
Mid-Atlantic.............................................. 11 10 6
DC.................................................... 0 0 0
DE.................................................... 0 0 0
MD.................................................... 0 0 0
NJ.................................................... 2 1 0
PA.................................................... 9 9 6
VA.................................................... 0 0 0
WV.................................................... 0 0 0
Midwest................................................... 19 19 20
IA.................................................... 2 2 2
IL.................................................... 13 13 13
MN.................................................... 1 1 1
WI.................................................... 3 3 4
New England............................................... 9 10 10
CT.................................................... 1 1 1
MA.................................................... 3 4 4
ME.................................................... 2 2 2

[[Page 77227]]

NH.................................................... 0 0 0
RI.................................................... 1 1 1
VT.................................................... 2 2 2
New York State............................................ 7 7 6
NY.................................................... 7 7 6
Northwest................................................. 8 8 6
AK.................................................... 0 0 0
ID.................................................... 2 2 2
MT.................................................... 1 1 1
OR.................................................... 2 2 1
WA.................................................... 3 3 2
................ ................ ................
Rocky Mountain............................................ 8 9 10
CO.................................................... 3 4 4
NE.................................................... 0 0 1
NM.................................................... 0 0 0
ND.................................................... 0 0 0
SD.................................................... 2 2 2
UT.................................................... 2 2 2
WY.................................................... 1 1 1
Southeastern.............................................. 2 2 1
AL.................................................... 1 1 1
FL.................................................... 0 0 0
GA.................................................... 0 0 0
KY.................................................... 0 0 0
MS.................................................... 0 0 0
NC.................................................... 1 1 0
SC.................................................... 0 0 0
TN.................................................... 0 0 0
PR.................................................... 0 0 0
Southwest............................................. 9 9 11
LA.................................................... 2 2 4
OK.................................................... 0 0 0
TX.................................................... 7 7 7
Western............................................... 5 2 2
AZ.................................................... 2 1 1
CA.................................................... 1 0 0
NV.................................................... 2 1 1
===========================================================
----------------------------------------------------------------------------------------------------------------

The majority of petitions certified under the TAAF program were
submitted by firms in the manufacturing industry. Firms in technical
services, transportation, and wholesale trade rounded out the remaining
industries\10\.
---------------------------------------------------------------------------

\10\ As identified by the firm's North American Industry
Classification System (NAICS) code.

---------------------------------------------------------------------------

[[Page 77228]]

[GRAPHIC] [TIFF OMITTED] TN31DE12.010

In FY 2012, 6 percent of firms certified for TAAF were identified
by the TAACs as service sector firms.\11\ This is an increase over FY
2011, where 2 percent of firms certified were identified by the TAACs
as service sector firms. As a result the Trade Adjustment Assistance
Extension Act of 2011 (Pub. L. 112-40), which retroactively extended
the provisions of the TAA programs that were enacted as part of the
TGAAA, demand from service firms is likely to continue to increase.
---------------------------------------------------------------------------

\11\ Firms in the service sector may also perform dual functions
as manufacturing firms and may have been categorized by TAACs as
manufacturing firm.

Exhibit 13--Firms Certified for TAAF Service vs. Manufacturing: FY 2012
--------------------------------------------------------------------------------------------------------------------------------------------------------
Percentage of Percentage of
Total number of Manufacturing manufacturing service firms
FY firms certified firms firms certified Service firms certified
(percent) (percent)
--------------------------------------------------------------------------------------------------------------------------------------------------------
2011.......................................................... 149 146 98 3 2
2012.......................................................... 79 74 94 5 6
--------------------------------------------------------------------------------------------------------------------------------------------------------

(5) The number of petitions filed and firms certified for each
Congressional District in the United States

Exhibit 14--Petitions Filed (Accepted) and Certified by Congressional
District: FY 2012
------------------------------------------------------------------------
Petitions
TAAC/State congressional district accepted Petitions
for filing certified
------------------------------------------------------------------------
Great Lakes................................... 5 5
IN............................................ 0 0
MI............................................ 3 3
2............................................. 1 1
3............................................. 1 1
4............................................. 1 1
OH............................................ 2 2
6............................................. 1 1
11............................................ 1 1
Mid-America................................... 2 2
AR............................................ 0 0
KS............................................ 1 1
4............................................. 1 1
MO............................................ 1 1
8............................................. 1 1
MidAtlantic................................... 10 6
DC............................................ 0 0
DE............................................ 0 0
MD............................................ 0 0
NJ............................................ 1 0
7............................................. 1 0
PA............................................ 9 6
1............................................. 1 1
3............................................. 1 0
8............................................. 1 1
10............................................ 1 1
11............................................ 1 1
15............................................ 1 0
19............................................ 3 2
VA............................................ 0 0
WV............................................ 0 0
Midwest....................................... 19 20
IA............................................ 2 2
1............................................. 1 1
4............................................. 1 1
IL............................................ 13 13
1............................................. 1 1
5............................................. 1 2
6............................................. 1 1
7............................................. 2 2
8............................................. 2 1
10............................................ 4 4
14............................................ 1 1
16............................................ 1 1
MN............................................ 1 1
4............................................. 1 1
WI............................................ 3 4
4............................................. 1 1
6............................................. 0 1
7............................................. 2 2
New England................................... 10 10
CT............................................ 1 1
2............................................. 1 1
MA............................................ 4 4
2............................................. 1 1
5............................................. 1 1
9............................................. 1 1
10............................................ 1 1
ME............................................ 2 2
1............................................. 2 2
NH............................................ 0 0
RI............................................ 1 1

[[Page 77229]]

2............................................. 1 1
VT............................................ 2 2
1............................................. 1 1
5............................................. 1 1
New York State................................ 7 6
NY............................................ 7 6
5............................................. 1 1
14............................................ 1 1
20............................................ 1 0
21............................................ 1 1
24............................................ 1 1
29............................................ 2 2
Northwest..................................... 8 6
AK............................................ 0 0
ID............................................ 2 2
1............................................. 1 1
2............................................. 1 1
MT............................................ 1 1
At-Large...................................... 1 1
OR............................................ 2 1
2............................................. 2 1
WA............................................ 3 2
2............................................. 2 1
3............................................. 1 1
Rocky Mountain................................ 9 10
CO............................................ 4 4
1............................................. 2 2
2............................................. 1 1
6............................................. 1 1
NE............................................ 0 1
2............................................. 0 1
NM............................................ 0 0
ND............................................ 0 0
SD............................................ 2 2
At-Large...................................... 2 2
UT............................................ 2 2
1............................................. 1 1
2............................................. 1 1
WY............................................ 1 1
At-Large...................................... 1 1
Southeastern.................................. 2 1
AL............................................ 1 1
3............................................. 1 1
FL............................................ 0 0
GA............................................ 0 0
KY............................................ 0 0
MS............................................ 0 0
NC............................................ 1 0
12............................................ 1 0
SC............................................ 0 0
TN............................................ 0 0
PR............................................ 0 0
Southwest..................................... 9 11
LA............................................ 2 4
1............................................. 1 2
3............................................. 1 2
OK............................................ 0 0
TX............................................ 7 7
6............................................. 1 1
13............................................ 2 2
20............................................ 1 1
23............................................ 1 1
26............................................ 1 1
28............................................ 1 1
Western....................................... 2 2
AZ............................................ 1 1
4............................................. 1 1
CA............................................ 0 0
NV............................................ 1 1
2............................................. 1 1
-------------------------
Total..................................... 83 79
------------------------------------------------------------------------

(6) Of the number of petitions filed, the number of firms that
entered the program and received benefits\12\
---------------------------------------------------------------------------

\12\ Benefits are defined as technical assistance provided to
TAAF-certified firms in preparing and implementing business recovery
plans (APs).
---------------------------------------------------------------------------

In FY 2012, 83 petitions were accepted (filed) for certification,
of which 79 were certified. Of the 79 firms certified in FY 2012, 57
firms submitted and were approved for an AP in the same fiscal
year\13\.
---------------------------------------------------------------------------

\13\ Firms have up to two years from the date of TAAF
certification to submit a business recovery plan (AP). These totals
represent the firms certified for TAAF in FY 2012 that also
submitted and received an approved business recovery plan in the
same fiscal year. The total number of APs approved in FY 2012 is
reported in Exhibits 19, 20 and 21.

Exhibit 15--Petitions Certified and APs Approved: FY 2012
------------------------------------------------------------------------
Number of
Number of APs
petitions Number of approved
TAAC accepted petitions for firms
for filing certified certified
in FY 2012
------------------------------------------------------------------------
Great Lakes...................... 5 5 5
Mid-America...................... 2 2 1
MidAtlantic...................... 10 6 2
Midwest.......................... 19 20 16
New England...................... 10 10 10
New York State................... 7 6 2
Northwest........................ 8 6 6
Rocky Mountain................... 9 10 10
Southeastern..................... 2 1 1
Southwest........................ 9 11 4
Western.......................... 2 2 0
Total............................ 83 79 57
------------------------------------------------------------------------

(7) The number of firms that received assistance in preparing
their petitions
In FY 2012, 341 firms received assistance in preparing petitions.
Firms may receive assistance in all phases of preparing petitions more
than once in a single year. Petition assistance rendered may not result
in the submission of a petition in the fiscal year.
Exhibit 16: Petition Assistance Activity: FY 2012

Exhibit 16--Petition Assistance Activity: FY 2012
------------------------------------------------------------------------
Petition
TAAC Assistance
------------------------------------------------------------------------
Great Lakes................................................ 13
Mid-America................................................ 15
MidAtlantic................................................ 22

[[Page 77230]]

Midwest.................................................... 117
New England................................................ 10
New York State............................................. 36
Northwest.................................................. 18
Rocky Mountain............................................. 15
Southeastern............................................... 36
Southwest.................................................. 37
Western.................................................... 22
Total...................................................... 341
------------------------------------------------------------------------

(8) The number of firms that received assistance developing
business recovery plans
In FY 2012, 206 firms received assistance in developing APs and 935
firms received assistance in implementing projects in these plans.
Firms may receive assistance in developing and implementing APs more
than once in a single year. AP assistance rendered may not result in
the submission or implementation of an AP in the current fiscal year.

Exhibit 17--AP Development Activity: FY 2012
------------------------------------------------------------------------
AP
TAAC Development
Assistance
------------------------------------------------------------------------
Great Lakes................................................ 7
Mid-America................................................ 6
MidAtlantic................................................ 12
Midwest.................................................... 61
New England................................................ 14
New York State............................................. 25
Northwest.................................................. 11
Rocky Mountain............................................. 11
Southeastern............................................... 5
Southwest.................................................. 48
Western.................................................... 6
Total...................................................... 206
------------------------------------------------------------------------

Exhibit 18--AP Implementation Activity: FY 2012
------------------------------------------------------------------------
AP
TAAC Implementation
Assistance
------------------------------------------------------------------------
Great Lakes............................................. 71
Mid-America............................................. 153
MidAtlantic............................................. 81
Midwest................................................. 142
New England............................................. 133
New York State.......................................... 45
Northwest............................................... 80
Rocky Mountain.......................................... 74
Southeastern............................................ 65
Southwest............................................... 52
Western................................................. 39
Total................................................... 935
------------------------------------------------------------------------

(9) The number of business recovery plans approved and denied by
the Secretary
In FY 2012, EDA approved 102 APs, down by 81 compared to FY 2011, a
44 percent decrease over this period \14\. EDA successfully met the 60-
day processing deadline for approval of APs. The average processing
time for APs was 21 business days \15\.
---------------------------------------------------------------------------

\14\ Some TAACs believe that fewer firms were eligible to
participate in the program because the economy's improvement from FY
2010 and FY 2011 prevented some firms from demonstrating a decrease
in employment, sales, and production required for eligibility.
Subsequently, fewer APs were submitted.
\15\ Firms have two years from the date of certification to
submit an AP to EDA. APs approved in FY 2012 may represent firms
that were certified for TAAF between FY 2010--FY 2012.

Exhibit 19--Summary of APs Approved: FY 2008--FY 2012
--------------------------------------------------------------------------------------------------------------------------------------------------------
Average Average days
Number of APs Total government Total projected government between
FY approved share Total firm share AP costs assistance per submission and
firm approval
--------------------------------------------------------------------------------------------------------------------------------------------------------
2008........................................ 143 $8,202,625 $7,711,375 $15,914,000 $57,361 21
2009........................................ 172 10,393,639 9,888,201 20,281,840 60,428 20
2010........................................ 264 16,448,946 15,743,946 32,192,892 62,307 24
2011........................................ 183 11,075,545 10,580,545 21,656,090 60,522 16
2012........................................ 102 5,437,455 5,033,455 10,470,910 53,308 21
-----------------------------------------------------------------------------------------------------------
Total....................................... 864 51,558,210 48,957,522 100,515,732 59,674 20
-----------------------------------------------------------------------------------------------------------
% Change.................................... (44%) (51%) (52%) (52%) (12%) 31%
(2011 to 2012)..............................
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 77231]]

[GRAPHIC] [TIFF OMITTED] TN31DE12.011

Exhibit 21: APs Approved by TAAC/State: FY 2012

Exhibit 20--APs Approved by TAAC: FY 2008--FY 2012
----------------------------------------------------------------------------------------------------------------
Government share Firm share of
TAAC/State Number of APs of approved AP approved AP Total approved
approved projects projects AP projects
----------------------------------------------------------------------------------------------------------------
Great Lakes............................. 6 $345,000 $315,000 $660,000
MI.................................. 3 172,500 157,500 330,000
OH.................................. 3 172,500 157,500 330,000
Mid-America............................. 3 225,000 225,000 450,000
KS.................................. 2 150,000 150,000 300,000
MO.................................. 1 75,000 75,000 150,000
MidAtlantic............................. 10 519,650 504,650 1,024,300
PA.................................. 10 519,650 504,650 1,024,300
Midwest............................. 23 1,177,972 1,057,972 2,235,944
IA.................................. 1 22,500 7,500 30,000
IL.................................. 17 885,472 810,472 1,695,944
MN.................................. 1 75,000 75,000 150,000
WI.................................. 4 195,000 165,000 360,000
New England............................. 14 600,000 510,000 1,110,000
CT.................................. 3 122,500 107,500 230,000
MA.................................. 5 130,000 70,000 200,000
ME.................................. 2 150,000 150,000 300,000
RI.................................. 2 47,500 32,500 80,000
VT.................................. 2 150,000 150,000 300,000
................ ................ ................ ................
New York State.......................... 9 604,000 590,000 1,194,000
NY.................................. 9 604,000 590,000 1,194,000
Northwest............................... 9 583,333 568,333 1,151,666
ID.................................. 3 172,500 157,500 330,000
MT.................................. 1 75,000 75,000 150,000
OR.................................. 2 128,000 128,000 256,000
WA.................................. 3 207,833 207,833 415,666
Rocky Mountain.......................... 11 527,500 527,500 1,055,000
CO.................................. 4 160,000 160,000 320,000
NE.................................. 1 30,000 30,000 60,000
NM.................................. 1 75,000 75,000 150,000
SD.................................. 2 82,500 82,500 165,000
UT.................................. 2 150,000 150,000 300,000
WY.................................. 1 30,000 30,000 60,000
................ ................ ................ ................
Southeastern............................ 5 217,500 172,500 390,000
AL.................................. 1 75,000 75,000 150,000
GA.................................. 1 22,500 7,500 30,000
NC.................................. 2 97,500 82,500 180,000

[[Page 77232]]

SC.................................. 1 22,500 7,500 30,000
Southwest............................... 10 592,500 547,500 1,140,000
LA.................................. 3 120,000 90,000 210,000
OK.................................. 2 150,000 150,000 300,000
TX.................................. 5 322,500 307,500 630,000
Western................................. 2 45,000 15,000 60,000
CA.................................. 2 45,000 15,000 60,000
-----------------------------------------------------------------------
Total........................... 102 5,437,455 5,033,455 10,470,910
----------------------------------------------------------------------------------------------------------------

(10) Average duration of benefits received under the program
nationally and in each region served by an intermediary organization
(the TAAC) referred to in section 253(b)(1) of the Trade Act
In FY 2012, 145 firms exited the TAAF program after being approved
for an AP. Nationally, firms receive on average 57 months \16\ of
benefits under the TAAF program. When calculating the average duration
of benefits regionally, firms received on average 55 months of benefits
under the TAAF program.
---------------------------------------------------------------------------

\16\ Prior to 2008, firms were allowed in excess of five years
to complete projects, resulting in a longer than average duration of
benefits. Firms have five years from the date of AP approval to
complete their projects.

Exhibit 22: Average Duration of Benefits Received--Firms that Completed
Program: FY 2012
------------------------------------------------------------------------
No. of
months
firms
Firm number received
benefits
under TAAF
program
------------------------------------------------------------------------
GLTAAC-EXT-001............................................. 34
GLTAAC-EXT-002............................................. 56
GLTAAC-EXT-003............................................. 53
GLTAAC-EXT-004............................................. 39
MamTAAC-EXT-001............................................ 63
MamTAAC-EXT-002............................................ 66
MamTAAC-EXT-003............................................ 135
MamTAAC-EXT-004............................................ 15
MamTAAC-EXT-005............................................ 82
MamTAAC-EXT-006............................................ 78
MamTAAC-EXT-007............................................ 78
MamTAAC-EXT-008............................................ 48
MamTAAC-EXT-009............................................ 66
MamTAAC-EXT-010............................................ 65
MamTAAC-EXT-011............................................ 64
MamTAAC-EXT-012............................................ 38
MamTAAC-EXT-013............................................ 91
MamTAAC-EXT-014............................................ 84
MamTAAC-EXT-015............................................ 74
MamTAAC-EXT-016............................................ 56
MamTAAC-EXT-017............................................ 90
MamTAAC-EXT-018............................................ 25
MamTAAC-EXT-019............................................ 70
MamTAAC-EXT-020............................................ 76
MamTAAC-EXT-021............................................ 32
MamTAAC-EXT-022............................................ 72
MamTAAC-EXT-023............................................ 72
MamTAAC-EXT-024............................................ 78
MamTAAC-EXT-025............................................ 63
MamTAAC-EXT-026............................................ 24
MamTAAC-EXT-027............................................ 25
MamTAAC-EXT-028............................................ 43
MamTAAC-EXT-029............................................ 70
MamTAAC-EXT-030............................................ 79
MamTAAC-EXT-031............................................ 70
MamTAAC-EXT-032............................................ 71
MamTAAC-EXT-033............................................ 71
MamTAAC-EXT-034............................................ 83
MATAAC-EXT-001............................................. 23
MATAAC-EXT-002............................................. 53
MATAAC-EXT-003............................................. 16
MATAAC-EXT-004............................................. 53
MATAAC-EXT-005............................................. 59
MATAAC-EXT-006............................................. 34
MATAAC-EXT-007............................................. 46
MATAAC-EXT-008............................................. 35
MATAAC-EXT-009............................................. 46
MATAAC-EXT-010............................................. 59
MATAAC-EXT-011............................................. 41
MATAAC-EXT-012............................................. 32
MATAAC-EXT-013............................................. 72
MWTAAC-EXT-001............................................. 25
MWTAAC-EXT-002............................................. 24
MWTAAC-EXT-003............................................. 79
MWTAAC-EXT-004............................................. 72
MWTAAC-EXT-005............................................. 68
MWTAAC-EXT-006............................................. 76
MWTAAC-EXT-007............................................. 69
MWTAAC-EXT-008............................................. 65
MWTAAC-EXT-009............................................. 48
MWTAAC-EXT-010............................................. 61
MWTAAC-EXT-011............................................. 61
MWTAAC-EXT-012............................................. 71
MWTAAC-EXT-013............................................. 32
MWTAAC-EXT-014............................................. 24
MWTAAC-EXT-015............................................. 24
MWTAAC-EXT-016............................................. 72
NETAAC-EXT-001............................................. 19
NETAAC-EXT-002............................................. 64
NETAAC-EXT-003............................................. 53
NETAAC-EXT-004............................................. 23
NETAAC-EXT-005............................................. 18
NETAAC-EXT-006............................................. 22
NETAAC-EXT-007............................................. 14
NETAAC-EXT-008............................................. 42
NETAAC-EXT-009............................................. 33
NETAAC-EXT-010............................................. 70
NETAAC-EXT-011............................................. 53
NETAAC-EXT-012............................................. 23
NETAAC-EXT-013............................................. 26
NETAAC-EXT-014............................................. 25
NETAAC-EXT-015............................................. 33
NWTAAC-EXT-001............................................. 71
NWTAAC-EXT-002............................................. 92
NWTAAC-EXT-003............................................. 21
NWTAAC-EXT-004............................................. 81
NWTAAC-EXT-005............................................. 80
NWTAAC-EXT-006............................................. 82
NWTAAC-EXT-007............................................. 20
NWTAAC-EXT-008............................................. 13
NWTAAC-EXT-009............................................. 63
NWTAAC-EXT-010............................................. 20
NWTAAC-EXT-011............................................. 20
NWTAAC-EXT-012............................................. 40
NYSTAAC-EXT-001............................................ 43
NYSTAAC-EXT-002............................................ 22
NYSTAAC-EXT-003............................................ 64
NYSTAAC-EXT-004............................................ 49
RMTAAC-EXT-001............................................. 51
RMTAAC-EXT-002............................................. 81
RMTAAC-EXT-003............................................. 84
RMTAAC-EXT-004............................................. 81
RMTAAC-EXT-005............................................. 60
RMTAAC-EXT-006............................................. 69
RMTAAC-EXT-007............................................. 67
RMTAAC-EXT-008............................................. 36
RMTAAC-EXT-009............................................. 72
RMTAAC-EXT-010............................................. 36
RMTAAC-EXT-011............................................. 29
RMTAAC-EXT-012............................................. 79
RMTAAC-EXT-013............................................. 30
RMTAAC-EXT-014............................................. 77

[[Page 77233]]

RMTAAC-EXT-015............................................. 46
RMTAAC-EXT-016............................................. 78
RMTAAC-EXT-017............................................. 75
RMTAAC-EXT-018............................................. 49
SETAAC-EXT-001............................................. 36
SETAAC-EXT-002............................................. 30
SETAAC-EXT-003............................................. 45
SETAAC-EXT-004............................................. 36
SETAAC-EXT-005............................................. 36
SETAAC-EXT-006............................................. 53
SETAAC-EXT-007............................................. 80
SETAAC-EXT-008............................................. 73
SWTAAC-EXT-001............................................. 80
SWTAAC-EXT-002............................................. 26
SWTAAC-EXT-003............................................. 26
SWTAAC-EXT-004............................................. 68
SWTAAC-EXT-005............................................. 68
SWTAAC-EXT-006............................................. 69
SWTAAC-EXT-007............................................. 66
SWTAAC-EXT-008............................................. 80
SWTAAC-EXT-009............................................. 74
SWTAAC-EXT-010............................................. 24
WTAAC-EXT-001.............................................. 90
WTAAC-EXT-002.............................................. 122
WTAAC-EXT-003.............................................. 81
WTAAC-EXT-004.............................................. 91
WTAAC-EXT-005.............................................. 116
WTAAC-EXT-006.............................................. 87
WTAAC-EXT-007.............................................. 82
WTAAC-EXT-008.............................................. 127
WTAAC-EXT-009.............................................. 114
WTAAC-EXT-010.............................................. 108
WTAAC-EXT-011.............................................. 109
Total National Average..................................... 57
------------
------------------------------------------------------------------------

Exhibit 23--Average Duration of Benefits Received--Firms That Completed
Program by TAAC (Region): FY 2012
------------------------------------------------------------------------
Average
Number of
months
TAAC firms
received
benefits
------------------------------------------------------------------------
Great Lakes................................................ 46
Mid-America................................................ 65
Mid-Atlantic............................................... 44
Midwest.................................................... 54
New England................................................ 35
New York State............................................. 45
Northwest.................................................. 50
Rocky Mountain............................................. 61
Southeastern............................................... 49
Southwest.................................................. 58
Western.................................................... 102
------------------------------------------------------------------------

(11) Sales, employment, and productivity at each firm
participating in the TAAF program at the time of certification
In FY 2012, 889 active firms participated in the TAAF program. A
firm that has been certified for TAAF, and/or has an approved AP, has
not completed all projects in their AP, and is still engaged in the
TAAF program is considered ``active.'' For the purposes of this report,
productivity is defined as net sales per employee. Since the certified
firms are in various industries, which have a variety of ways to
measure productivity, sales per employee is utilized as a standardized
measure for assessing productivity across all firms assisted.

Exhibit 24--Sales, Employment, and Productivity \17\ at All Firms Participating in the TAAF Program in FY 2012
by TAAC and State:
----------------------------------------------------------------------------------------------------------------
Total No. of
TAAC/State Active Firms in Total Sales at Total Employment Total Average
FY 2012 Certification at Certification Productivity
----------------------------------------------------------------------------------------------------------------
Great Lakes............................. 73 $1,791,172,281 9,760 $183,522
IN.................................. 18 278,004,201 2,253 123,393
MI.................................. 31 547,706,669 2,254 242,993
OH.................................. 24 965,461,411 5,253 183,792
Mid-America............................. 46 682,877,581 4,951 137,927
AR.................................. 7 16,401,481 340 48,240
KS.................................. 15 149,072,277 1,436 103,811
MO.................................. 24 517,403,823 3,175 162,962
MidAtlantic............................. 90 1,049,770,941 6,548 160,319
MD.................................. 3 5,500,143 47 117,024
NJ.................................. 4 22,286,404 195 114,289
PA.................................. 80 1,008,680,988 6,121 164,790
VA.................................. 3 13,303,406 185 71,910
Midwest................................. 137 2,212,081,842 11,961 184,941
IA.................................. 5 120,097,360 519 231,401
IL.................................. 81 843,583,273 4,887 172,618
MN.................................. 23 367,933,664 2,512 146,470
WI.................................. 28 880,467,545 4,043 217,776
New England............................. 133 1,011,453,493 6,479 156,113
CT.................................. 19 135,382,965 926 146,202
MA.................................. 60 400,041,096 2,574 155,416
ME.................................. 15 230,970,276 1,177 196,236
NH.................................. 20 131,043,944 902 145,282
RI.................................. 16 77,235,126 619 124,774
VT.................................. 3 36,780,086 281 130,890
New York State.......................... 61 1,172,727,977 4,823 243,153
NY.................................. 61 1,172,727,977 4,823 243,153

[[Page 77234]]

Northwest............................... 85 913,564,319 5,745 159,019
AK.................................. 4 22,825,992 110 207,509
ID.................................. 11 62,150,148 688 90,335
MT.................................. 11 54,667,266 415 131,728
OR.................................. 20 419,792,240 2,211 189,865
WA.................................. 39 354,128,673 2,321 152,576
Rocky Mountain.......................... 67 2,479,134,862 10,068 246,239
CO.................................. 28 994,105,459 2,956 336,301
ND.................................. 6 155,904,843 714 218,354
NE.................................. 5 32,840,837 243 135,147
NM.................................. 4 40,663,880 290 140,220
SD.................................. 8 342,138,076 1,246 274,589
UT.................................. 13 862,552,034 4,302 200,500
WY.................................. 3 50,929,733 317 160,662
Southeastern............................ 67 998,693,863 10,038 99,491
AL.................................. 4 28,653,300 346 82,813
FL.................................. 6 18,996,354 191 99,457
GA.................................. 13 90,265,046 978 92,296
KY.................................. 3 91,456,507 488 187,411
MS.................................. 1 2,496,868 21 118,898
NC.................................. 25 511,427,054 6,607 77,407
SC.................................. 10 183,496,458 922 199,020
TN.................................. 5 71,902,276 485 148,252
Southwest............................... 90 421,071,529 3,637 115,774
LA.................................. 19 114,522,181 551 207,844
OK.................................. 30 156,841,533 1,563 100,346
TX.................................. 41 149,707,815 1,523 98,298
Western................................. 40 773,072,997 3,507 220,437
AZ.................................. 3 92,655,000 400 231,638
CA.................................. 35 657,349,131 2,981 220,513
HI.................................. 2 23,068,866 126 183,086
Total (Nationwide)...................... 889 13,505,621,685 77,517 174,228\18\
----------------------------------------------------------------------------------------------------------------

(12) Sales, employment, and productivity at each firm upon
completion of the program and each year for the two-year period
following completion
---------------------------------------------------------------------------

\17\ The total productivity as presented in across TAACs, States
and the summary line of Exhibit 24 represents the actual total
average productivity in FY 2012. This total, derived by calculating
the mean horizontally (not vertically), is based on raw data and
provides the most accurate representation of productivity for all
TAACs and States. While this figure is provided in the table, it
should be noted that calculating total productivity vertically
introduces additional degrees of error as it represents the average
of averages.\18\ The total productivity as presented in across
TAACs, States and the summary line of Exhibit 24 represents the
actual total average productivity in FY 2012. This total, derived by
calculating the mean horizontally (not vertically), is based on raw
data and provides the most accurate representation of productivity
for all TAACs and States. While this figure is provided in the
table, it should be noted that calculating total productivity
vertically introduces additional degrees of error as it represents
the average of averages.
---------------------------------------------------------------------------

(13) The number of firms in operation as of the date of this report
and the number of firms that ceased operations after completing the
program in each year during the two-year period following completion of
the program
In order to assess the effectiveness of the TAAF program in terms
of outputs, EDA assesses the extent to which client firms increased
their sales, employment levels, and productivity following the
implementation of TAAF-supported projects (program completion). To
measure these outputs, EDA compares average sales, average employment
and average productivity of all firms completing the program in a
particular year (the most recent ``base year'') to these same measures
for the same firms one and two years following program completion. The
base year used for this report is FY 2010, as this allows EDA to
compare these measures looking back both one and two years from the
date of this report.
Firms that completed the TAAF program in FY 2010 reported that, at
completion, average sales were $10.1 million, average employment was 53
and average sales per employee (productivity) was $191,328. One year
after completing the program (FY 2011), these same firms reported that
average sales increased by 11.4 percent, average employment increased
by 13.2 percent, and average productivity decreased by 1.6 percent. For
the sake of comparison to the universe of U.S. manufacturers, BLS
reported that, in FY 2011, the national manufacturing industry in
aggregate experienced an average employment increase of only 1.9
percent.
Two years after completing the program (FY 2012), these same firms
reported that average sales increased by 26.8 percent, average
employment increased by 13.2 percent, and average productivity \19\
increased by 11.9 percent. Meanwhile, BLS reported that the
manufacturing industry in FY 2012 experienced an average employment
increase of 3.5 percent and an average productivity increase of 4.1
percent from FY 2010. Therefore, firms assisted by the TAAF program
performed more successfully than the manufacturing industry as a whole.
Additionally, all firms that completed the TAAF program in FY 2010 were
in operation as of the end of FY 2012, indicating strong ``survival
rates'' for TAAF-assisted firms. It should be noted that TAAF clients
are operating in the same

[[Page 77235]]

economic environment as other firms, but are also attempting to adjust
to import pressures that may not impact other firms as severely, making
the success of TAAF-assisted firms even more notable.
---------------------------------------------------------------------------

\19\ BLS' productivity measures relate output to the labor hours
used in the production of that output.
---------------------------------------------------------------------------

For the purposes of this report, data are reported only for firms
where all data were available. Since the certified firms are in various
industries, which have a variety of ways to measure productivity, sales
per employee was chosen as the productivity measure. This measure is
used because it can be generally applied to all certified firms.

Exhibit 25--Summary of Average Sales, Employment, and Productivity at Firms upon Completion of the Program and
the One-Year and Two-Year Period Following Completion
----------------------------------------------------------------------------------------------------------------
1st Year 2nd Year
Completion (FY following following % Change 1st % Change 2nd
2010) completion (FY completion (FY Year (percent) Year (percent)
2011) 2012)
----------------------------------------------------------------------------------------------------------------
Average Sales................... $10,140,385 $11,300,792 $12,855,193 11.4% 26.8%
Average Employment.............. 53 60 60 13.2 13.2
Average Productivity............ $191,328 $188,347 $214,253 (1.6%) 11.9%
----------------------------------------------------------------------------------------------------------------

[[Page 77236]]

Exhibit 26--Sales, Employment, and Productivity at Each Firm Upon Completion of the Program and Two-year Period Following Completion
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Average Average
Average sales Average sales Average Average Average Average productivity productivity
Average sales 1st Yr. 2nd Yr. employment at employment 1st employment 2nd productivity 1st Yr. 2nd Yr.
Firm ID at completion following following completion (FY Yr. following Yr. following at completion following following
(FY 2010) completion (FY completion (FY 2010) completion (FY completion (FY (FY 2010) completion (FY completion (FY
2011) 2012) 2011) 2012) 2011) 2012)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
GLTAAC-CMP-001.................................. $23,000,000 $40,200,000 $70,000,000 108 103 125 $212,963 $390,291 $560,000
GLTAAC-CMP-002.................................. 33,291,000 35,000,000 46,200,000 118 115 120 282,127 304,348 385,000
GLTAAC-CMP-003.................................. 33,000,000 38,000,000 36,000,000 185 330 370 178,378 115,152 97,297
MamTAAC-CMP-002................................. 30,421,806 35,697,560 28,980,224 145 161 139 209,806 221,724 208,491
MamTAAC-CMP-006................................. 9,969,765 8,969,168 6,632,938 64 69 58 155,778 129,988 114,361
MamTAAC-CMP-007................................. 5,849,007 4,778,810 5,394,320 28 18 15 208,893 265,489 359,621
MamTAAC-CMP-010................................. 1,900,000 2,533,745 3,500,000 18 22 26 105,556 115,170 134,615
MamTAAC-CMP-013................................. 1,261,088 2,084,480 2,875,000 14 17 17 90,078 122,616 169,118
MamTAAC-CMP-014................................. 2,202,559 2,635,713 2,635,713 19 21 21 115,924 125,510 125,510
MamTAAC-CMP-016................................. 10,613,000 10,980,000 8,825,000 38 43 43 279,289 255,349 205,233
MamTAAC-CMP-018................................. 7,570,000 8,456,000 9,000,000 30 33 33 252,333 256,242 272,727
MamTAAC-CMP-021................................. 4,412,568 6,984,385 939,327 19 32 20 232,240 218,262 46,966
MamTAAC-CMP-023................................. 6,414,455 5,697,336 5,027,557 89 69 59 72,073 82,570 85,213
MamTAAC-CMP-025................................. 8,694,000 5,630,530 6,331,934 45 40 45 193,200 140,763 140,710
MWTAAC-CMP-001.................................. 14,603,721 14,600,000 17,800,000 124 125 130 117,772 116,800 136,923
MWTAAC-CMP-006.................................. 18,585,466 21,900,000 21,900,000 80 90 90 232,318 243,333 243,333
NWTAAC-CMP-001.................................. 2,100,000 3,085,000 3,000,000 22 15 14 95,455 205,667 214,286
NWTAAC-CMP-002.................................. 13,000 6,000 10,000 1 1 1 13,000 6,000 10,000
NWTAAC-CMP-003.................................. 55,571,000 64,167,000 66,000,000 163 188 180 340,926 341,314 366,667
NWTAAC-CMP-004.................................. 3,500,000 2,680,000 8,000,000 28 18 22 125,000 148,889 363,636
NWTAAC-CMP-005.................................. 680,000 440,000 450,000 12 10 10 56,667 44,000 45,000
NWTAAC-CMP-006.................................. 8,000,000 13,000,000 15,000,000 65 125 100 123,077 104,000 150,000
NWTAAC-CMP-007.................................. 14,000,000 10,000,000 25,000,000 45 55 65 311,111 181,818 384,615
NWTAAC-CMP-008.................................. 1,730,000 1,975,000 2,400,000 35 30 28 49,429 65,833 85,714
NWTAAC-CMP-010.................................. 1,900,000 2,100,000 2,200,000 5 7 12 380,000 300,000 183,333
NYSTAAC-CMP-001................................. 4,000,000 4,100,000 4,400,000 30 25 25 133,333 164,000 176,000
NYSTAAC-CMP-002................................. 2,100,000 2,100,000 2,500,000 25 25 27 84,000 84,000 92,593
NYSTAAC-CMP-003................................. 990,000 950,000 900,000 2 2 2 495,000 475,000 450,000
NYSTAAC-CMP-004................................. 12,100,000 12,200,000 13,200,000 79 78 80 153,165 156,410 165,000
NYSTAAC-CMP-005................................. 535,000 500,000 490,000 4 4 4 133,750 125,000 122,500
NYSTAAC-CMP-006................................. 4,900,000 5,600,000 5,700,000 31 34 34 158,065 164,706 167,647
NYSTAAC-CMP-007................................. 3,100,000 3,600,000 3,750,000 21 25 25 147,619 144,000 150,000
NYSTAAC-CMP-008................................. 7,800,000 7,700,000 7,900,000 65 64 65 120,000 120,313 121,538
NYSTAAC-CMP-009................................. 36,000,000 34,000,000 36,500,000 151 157 160 238,411 216,561 228,125
RMTAAC-CMP-001.................................. 123,000 138,000 130,000 2 6 5 61,500 23,000 26,000
RMTAAC-CMP-002.................................. 1,547,913 2,500,722 2,718,122 19 23 21 81,469 108,727 129,434
RMTAAC-CMP-003.................................. 2,715,885 3,139,869 3,352,000 42 42 37 64,664 74,759 90,595
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Total Average................................... 10,140,385 11,300,792 12,855,193 53 60 60 191,328 188,347 214,253
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 77237]]

(14) The financial assistance received by each firm participating
in the program
(15) The financial contribution made by each firm participating in
the program
In FY 2012, firms received $9.8 million in technical assistance
provided by the TAACs to prepare petitions and to develop and implement
APs (often through business consultants and other experts). Firms
participating in the program contributed $6.3 million towards the
development and implementation of APs. Funds are not provided directly
to firms; instead, EDA funds the TAACs and TAACs pay a proportion of
the cost to secure specialized business consultants.
[GRAPHIC] [TIFF OMITTED] TN31DE12.012

(16) The types of technical assistance included in the business
recovery plans of firms participating in the program
---------------------------------------------------------------------------

\20\ This does not include the amount expended by the TAACs for
outreach to potential new firms.
---------------------------------------------------------------------------

In FY 2012, firms proposed various types of projects in their APs.
Marketing/sales projects are geared toward increasing revenue, whereas
production/manufacturing projects tend to be geared toward cutting
costs. Support system projects can provide a competitive advantage by
either cutting costs or creating new sales channels. Management and
financial projects are designed to improve management's decision making
ability and business control. Over half of all firms proposed to
implement a marketing/sales project or production/engineering project
in their APs. Sample projects are listed below in Exhibit 28.

[[Page 77238]]

Exhibit 28--Characteristics of Technical Assistance in APs: FY 2012
----------------------------------------------------------------------------------------------------------------
Number of AP
Project Classification Sample types of projects projects \21\ AP Project costs
----------------------------------------------------------------------------------------------------------------
Financial................................ Accounting systems 10 $216,000
upgrade.
Cost control tracking
system
Automatic Data
Processing development.
Management............................... Strategic business 30 549,166
planning.
Succession management
Management development..
Marketing/Sales.......................... Sales process training.. 103 3,984,800
Market expansion and
feasibility
Web site design and
upgrade.
Production............................... Lean manufacturing and 93 3,490,944
certification.
New product development
Production and warehouse
automation.
Support Systems.......................... Enterprise Resource 65 2,230,000
Planning.
Management Information
Systems upgrades
Computer Aided Design
software.
Supply chain management
software.
----------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------

\21\ A firm may have up to five projects in an approval AP.
[GRAPHIC] [TIFF OMITTED] TN31DE12.013

(17) The number of firms leaving the program before completing the
project or projects in their business recovery plans and the reason the
project or projects were not completed
In FY 2012, of the 145 firms that left the TAAF program, 84
completed the program, 34 did not complete approved projects in the
time allotted, and the remaining 27 firms left for the reasons listed
below in Exhibit 30.

Exhibit 30--Summary of Firms Leaving the TAAF program: FY 2012
------------------------------------------------------------------------
Number of
Reason for leaving Program firms
------------------------------------------------------------------------
Bankruptcy Filing............................................ 1
Completed TAAF Program....................................... 84
Expired without completing all projects within 5 year limit.. 34
Firm failed to submit AP within 2 years of TAAF certification 12
Firm opted out of program.................................... 2
Merger/Acquisition........................................... 4
Out of business.............................................. 3
Owner deceased............................................... 2
Sold Company................................................. 3
Total........................................................ 145
------------------------------------------------------------------------

[[Page 77239]]

[GRAPHIC] [TIFF OMITTED] TN31DE12.014

(18) The total amount expended by all intermediary organizations
referred to in Section 253(b)(1) and by each organization to administer
the program
On May 11, 2012, the Department of Commerce Office of Inspector
General (OIG) presented EDA with a copy of their letter to the House
and Senate Committees on Appropriations reporting their findings
related to an examination of the TAAC administrative costs.\22\ As part
of their review, OIG obtained expenditure data from a sample of three
TAACs--Western, New England, and New York State--focusing on the use of
Federal funds provided by EDA. The OIG reported that it ``did not
determine that the level of administrative costs of the three TAACs to
be unreasonable.''
---------------------------------------------------------------------------

\22\ The information was requested in the House Committee Report
that accompanied the FY 2012 Commerce, Justice, Science, and Related
Agencies Appropriations bill.
---------------------------------------------------------------------------

Indirect Costs, referred to as facilities and administrative (F&A)
costs, include space rent and utilities, telephone, postage, printing,
and other administrative costs. University-affiliated TAACs have
indirect cost rate (ICR) agreements that cannot exceed the current rate
negotiated with their cognizant Federal agency (non EDA/DOC). These
costs are captured on the indirect cost line item on the Application
for Federal Assistance, SF-424 (Form SF-424). Non-profit TAACs do not
have ICR agreements; instead, they categorize similar expenditures in
their ``Other'' line item of their Form SF-424.
(19) The total amount expended by intermediary organizations to
provide technical assistance to firms under the program nationally and
in each region served by such an organization

[[Page 77240]]

[GRAPHIC] [TIFF OMITTED] TN31DE12.015

In FY 2012, TAACs expended $10.7 million in technical assistance
provided to the firms in outreach to firms, to prepare petitions, and
to develop and implement APs (often through business consultants and
other experts). Funds

[[Page 77241]]

are not provided directly to firms; instead, EDA funds the TAACs and
TAACs pay a cost-shared proportion of the cost to secure specialized
business consultants.

Exhibit 32: Summary of Expenditures--Technical Assistance to Firms by
TAAC: FY 2012
[GRAPHIC] [TIFF OMITTED] TN31DE12.016

Conclusion

Through TAAF program, EDA effectively assisted many small and
medium-sized firms in becoming more competitive and successful in the
global economy. EDA considers the most significant finding in this
report to be that following completion of assistance from EDA's TAAF
program, firms reported that, on average, sales increased by 26.8
percent, employment increased by 13.2 percent, and productivity
increased by 11.9 percent.
The TAAF program effectively assisted small and medium-sized firms
in FY 2012. TAACs provided technical assistance to 341 firms in
preparing petitions, 206 firms in preparing APs, and 935 firms in
implementing projects for an approved AP. Meanwhile, EDA certified 79
petitions and approved 102 APs. As of the end of FY 2012 (September 30,
2012), there are 889 active \23\ firms participating in the TAAF
program.
---------------------------------------------------------------------------

\23\ A firm that has been certified for TAAF, and/or has an
approved Adjustment Proposal, has not completed all projects in
their AP, and is still engaged in the TAAF program is considered
``active.''
---------------------------------------------------------------------------

EDA successfully met both the 40-day processing deadline (to make a
final determination for petitions accepted for filing) and the 60-day
processing deadline for approval of APs, as required in the TGAAA. In
FY 2012, the average processing time for petitions was 29 business
days, and the average processing time for APs was 21 business days.
Firms that completed the TAAF program in FY 2010 report that
average sales were $10.1 million, average employment was 53, and
average sales per employee (productivity) was $191,328. One year after
completing the program (FY 2011), these same firms reported that
average sales increased by 11.4 percent, average employment increased
by 13.2 percent, and average productivity decreased by 1.6 percent. For
the sake of comparison to the universe of U.S. manufacturers, the U.S.
Bureau of Labor Statistics (BLS) reported that, in FY 2011, the
national manufacturing industry in aggregate experienced an average
employment increase of only 1.9 percent meaning that firms who complete
the program

[[Page 77242]]

are more successful than firms generally.
Two years after completing the program (FY 2012), these same firms
reported that average sales increased by 26.8 percent, average
employment increased by 13.2 percent, and average productivity
increased by 11.9 percent. Meanwhile, BLS reported that the
manufacturing industry in FY 2012 experienced an average employment
increase of 3.5 percent and average productivity increase of 4.1
percent from FY 2010. Therefore, firms assisted by the TAAF program
performed more successfully than the manufacturing industry as a whole.
Additionally, all firms that completed the TAAF program in FY 2010 were
in operation as of the end of FY 2012, indicating strong ``survival
rates'' for TAAF-assisted firms. It should be noted that TAAF clients
are operating in the same economic environment as other firms, but are
also attempting to adjust to import pressures that may not impact other
firms as severely, making the success of TAAF-assisted firms even more
notable.
On May 11, 2012, the Department of Commerce Office of Inspector
General (OIG) presented EDA with a copy of their letter to the House
and Senate Committees on Appropriations reporting their findings
related to an examination of the TAAC administrative costs\24\. As part
of their review, OIG obtained expenditure data from a sample of three
TAACs--Western, New England, and New York State--focusing on the use of
Federal funds provided by EDA. The OIG reported that it ``did not
determine that the level of administrative costs of the three TAACs to
be unreasonable.''
---------------------------------------------------------------------------

\24\ The information was requested in the House Committee Report
that accompanied the FY 2012 Commerce, Justice, Science, and Related
Agencies Appropriations bill.
---------------------------------------------------------------------------

On September 13, 2012, the U.S. Government Accountability Office
(GAO) published the report, Trade Adjustment Assistance: Commerce
Program Has Helped Manufacturing and Services Firms, but Measures,
Data, and Funding Formula Could Improve (GAO-12-930). The GAO report
documented the results of their independent analysis, which included
strong evidence demonstrating the effectiveness of the TAAF program.
GAO's key finding was that for firms receiving assistance between FY
2008 and FY 2011, ``the effect of participation in the program was an
increase in firm sales ranging from 5 to 6 percent on average,'' and
that ``the effect of the program on productivity was about a 4 percent
increase.'' As part of this study, GAO contacted 163 firms who had been
involved with the TAAF program, and received responses from 117. As
noted in the report, nearly all of the responding firms reported they
were generally or very satisfied with the program. Manufacturing firms,
specifically, reported that the program was associated with increased
sales and productivity. Notably, an impressive 73 percent of the firms
reported the program helped them with profitability, 71 percent said it
helped them retain employees, and 57 percent reported that the program
helped them hire new employees.
EDA is currently implementing a performance measurement improvement
process for all its programs, including TAAF, which began in late 2011
and consists of two phases: planning and development, and
implementation. The one-year planning and development stage is expected
to be completed in FY 2013. The first phase includes the following
activities: researching and identifying improved metrics and
indicators, testing the metrics and indicators across the full
portfolio of EDA investments, and developing a work plan for
implementing measures that are adopted. To assist with this effort, EDA
has partnered with the University of North Carolina and George
Washington University to develop draft performance measures utilizing
state-of-the-art performance measurement and program evaluation
techniques.
The subsequent implementation phase of the performance measurement
improvement process will include the following activities: obtaining
Office of Management and Budget approval of data collection forms,
developing a database to store collected data, updating programmatic
guidance and regulations, and examining the allocation formula used to
distribute program funds to the TAACs in collaboration with both TAACs
and Congressional stakeholders. The entire process is expected to be
completed by the end of 2014.
The performance measurement improvement process will help EDA be
even a stronger partner to its clients and grantees. Through more
effective program management and performance assessment, EDA will be in
a better position to achieve the desired results for each of its
programs.

Supplement

TAAF Program Benefits to Manufacturing Firms

Examples of TAAF Assistance

Great Lakes Trade Adjustment Assistance Center (GLTAAC)

This Michigan firm manufactures self-adhesive strip and sheet
products for the automotive industry. The firm lost 38 percent of its
sales in 2009 as demand disappeared and customers frantically switched
to low cost foreign suppliers. It entered the TAAF program in 2010. The
firm needed to improve its productivity and streamline its business
processes. To accomplish this, replacing the firm's antiquated
Enterprise Resource Planning (ERP) system was paramount. After much
research, the firm licensed a new system and used TAAF assistance to
train the workforce in its use. The new ERP went live in January 2011,
and the impact was immediate. Not only has it cut hardware costs and
annual fees by 50 percent, it has also greatly reduced data input and
handling time. The firm has been able to go virtually paperless, as
documents are seamlessly handled and hardcopies are rarely required.
Further, the new system is connected to its automotive forecasting
service so that high-level sales forecasts are made automatically as
customers release their model plans. Results of this ERP implementation
have been truly transformative for the

[[Page 77243]]

firm, resulting in ``fabulous'' performance, according to the firm's
CFO. As a result of this project and much hard work by the firm, it has
been able to rehire many of the workers that were laid off in 2009.
Though not yet fully recovered, the firm has now increased employment
by 40 percent since entering the TAAF program. The firm currently
employs about 90 workers and generates over $20 million in sales. The
firm just started another worker training project via the program.
An Ohio packaging firm was hit hard by rising import competition
from China and other East Asian countries. Its customers were
increasingly looking to cut costs by sourcing their packaging from
abroad. This forced serious production cuts at the firm, which
ultimately necessitated employee layoffs. The firm entered the TAAF
program in early 2008. Its Adjustment Plan was approved in June of that
year and included a wide range of needed improvements. The firm's first
projects included a detailed evaluation and restructuring of its sales
team, as well as the development of much needed marketing materials.
Improvements to its costing and quoting system were next, followed by a
revamping of its Web site. The firm's most recent TAAF project,
completed in June 2012, was part of a major lean manufacturing
initiative. Following classroom training financed in part by the State
of Ohio, the TAAF program helped provide on-site employee training and
hands-on coaching to jumpstart the firm's productivity improvement
efforts. This ``last mile'' project--the customized on-site lean
training--had a huge impact on the overall success of the effort. The
firm has made great progress to date--sales have rebounded
significantly (up 50 percent from their low), and productivity is much
improved. However, considerable work remains to be done. The firm is
about to begin a project that will dramatically strengthen its finance
function. By the time this firm completes the program, it will be
positioned to thrive, not just survive.

Mid-America Trade Adjustment Assistance Center (MamTAAC)

A Missouri fabric-based products manufacturer has been receiving
technical assistance funded by the TAAF program since December 2010.
The first project included a comprehensive review of their pay scale
compared with market salaries and wages. The intent of this project
included addressing personnel issues and forming a strong cohesive team
to bring the business out of the recession. The next project involved
employee training in the use of their Computer Aided Design software,
which supported high investment equipment that enabled them to keep
work in-house and support additional employees to be added. A portion
of the TAAF assistance enabled the firm to implement an International
Organization for Standardization (ISO) compliant quality system and to
subsequently become certified to ISO 9001:2008. The ISO certification
has enabled the firm to increase sales to a major defense contractor by
over 50 percent. This sales increase and business from new market
segments have necessitated increasing employees by 15 percent. With the
help of MamTAAC and TAAF-funded technical assistance, the firm has been
able to build a manufacturing organization that can continue to
effectively compete and grow.
A Missouri wood products manufacturer has been enrolled in the
program since 2004. In 2004, the firm had 16 employees and average
revenue of $3 million and faced fierce competition with Chinese
imports. TAAF funding allowed the firm to upgrade its management
information systems, upgrade their ERP system, and purchase a
production module to help with manufacturing data capture and tracking.
Later, with technical assistance from MamTAAC, the firm leveraged TAAF
program funds to provide human resources, employee, and executive
training, which in addition to educating the firm's leadership on sound
business practices, allowed the owner to take actual business problems
that were especially related to growth to a group of business owner
peers for feedback. Today the firm has 36 employees with 6 more slated
to be added in 2012, and revenues are projected to be above $8 million.
The firm expects that by 2015, revenue will increase to $14 million and
employment to 60.

MidAtlantic Trade Adjustment Assistance Center (MATAAC)

A Pennsylvania maker of pressure control devices for the fluid
power and chemical industries was in its third year of declining sales,
profits, and employment when awarded TAAF-funded technical assistance
in 2008. Sales had fallen by 37 percent, profits had declined 67
percent and 8 percent of the employees were laid off as a direct result
of imports. The company implemented projects in strategic planning,
lean manufacturing, marketing communications, and six sigma. Since
program entry, sales have improved by more than 20 percent, jobs have
grown by 12 percent, earnings have increased 42 percent, productivity
has increased 7.5 percent, and return on human capital has grown 26.9
percent. As a direct consequence of this success, a world leader in the
American fluid power industry acquired the firm in October 2012.
A Pennsylvania manufacturer of industrial wear products for the
construction and material handling industries had suffered a 25 percent
drop in sales, an 83 percent reduction in earnings, an 81 percent
decline in productivity and 13 percent of its employees had been
separated--all over a 24-month period. A flood of imports impacted
virtually all of the company's products. Management recognized that its
product line had been commoditized and that it could no longer compete
on price alone. With projects addressing new product development, e-
commerce and systems technology, the firm began to add value through
superior design, cost mastery, and marketing. The firm was awarded
TAAF-funded technical assistance in 2011. Since program entry, sales
have grown by more than 50 percent, earnings have improved five-fold,
productivity has increased more than 12 percent, jobs have grown 36
percent, and the return on the firm's human capital has more than
tripled.

Midwest Trade Adjustment Assistance Center (MWTAAC)

A Wisconsin manufacturer of custom solenoids was experiencing tough
competition from Asian importers in the automotive, recreational
vehicle, motorcycle, and industrial application markets. Several key
customers moved their purchases to overseas providers with cheaper
prices, resulting in a 21 percent decline in sales, forcing the firm to
lay off workers. The firm was certified for TAAF in June 2010. The firm
was able to enhance marketing tools with two projects in late 2010 that
helped attract new domestic and international customers. In addition,
the firm was able to cost-share export development assistance early in
2012, including research and marketing material translation. As a
result of assistance from MWTAAC and TAAF-funded technical assistance,
the manufacturer's exports have grown dramatically and both sales and
employment have increased over 90 percent in less than two years.
A Minnesota manufacturer of commercial and residential air
filtration systems received TAAF-funded technical assistance between
2008 and 2011 for export-related quality certifications, testing and
marketing material translation. In addition, TAAF program technical
assistance provided

[[Page 77244]]

Management Information System (MIS) enhancement and training which has
allowed the company to manage the expansion and control costs. In the
most recent year, the manufacturer has identified $77,659 of new export
sales directly attributable solely to TAAF assistance.

New England Trade Adjustment Assistance Center (NETAAC)

A Connecticut metal finishing firm, the largest full-service metal
finisher in the Northeast, experienced a significant decline in sales
due to increased foreign competition and a shrinking domestic market.
In 2010, the firm was certified for TAAF and with the assistance of
NETAAC, prepared an AP to fund projects such as leadership training, a
new Web site, upgraded marketing materials, establish lean
manufacturing, and NADCAP, a critical certification that could
potentially open many new markets for the firm. After merging with
another local Connecticut firm, they are now able to service a much
larger market providing full-service metal finishing services. As a
result of TAAF-funded technical assistance, the firm has become
stronger and more competitive, increasing sales by 20 percent and
adding 20 more jobs.
A Rhode Island full-service contract manufacturer serving a diverse
group of customers including electronic manufacturers of medical
instrumentation, military electronics, oceanographic instruments, and
commercial products was adversely affected by a combination of growing
foreign market competition and the global recession. In 2010, the firm
was certified for TAAF and, with the assistance of NETAAC, prepared a
business recovery plan (AP) to fund projects such as development of a
strategic business plan, marketing and sales plan, MIS upgrades, and
process improvement program. Within one year of TAAF-funded technical
assistance, the firm has realized a 10 percent increase in employment
and a 15 percent increase in sales. After successful realization of
Lean Manufacturing and sales and marketing projects, the firm was able
to capture new orders, increased the need for continuous improvement,
and was able to lower cost of production by further streamlining their
processes. The firm is now focusing on re-shoring efforts and committed
to bringing jobs back to America.

New York State Trade Adjustment Assistance Center (NYSTAAC)

A New York manufacturer of precision optical fabrication machines
and systems was suffering from the adverse effects of foreign
competition from Germany. The combination of the foreign competition,
coupled with the recent downturn in the economy, significantly reduced
the firm's sales revenues. The firm needed to react to the continual
loss of market share to foreign competition and did not have a formal
strategic-based sales and marketing plan in place nor did it have the
internal expertise to develop one. In order to effectively recover from
the adverse effects of foreign competition, the firm sought technical
assistance from NYSTAAC. At the time of TAAF certification, the firm
had 35 full-time employees and annual sales of approximately $6
million. In order to stop the decline in sales and employment levels,
the firm with assistance from NYSTAAC and TAAF-funded technical
assistance, developed a business recovery plan (AP) that included a
formal sales and marketing plan. In following the plan, the firm was
able to achieve 85 percent growth in sales revenue to an annual rate of
$12 million. This in turn has resulted in the firm adding 17 new
employees since the implementation of the plan. An additional major
outcome of the planning process was the recent expansion of the firm's
manufacturing facility to accommodate new business.
A New York manufacturer of clipboards sought technical assistance
from NYSTAAC to develop a business recovery plan (AP) to address
inefficiencies with an outdated Management Information System (MIS) and
production software, which when improved, would reduce deficits and
increase productivity, resulting in higher output and increased sales.
Since the firm was certified for TAAF in 2008, their sales have
increased approximately $3.4 million and they have been able to
maintain the same employment level.

Northwest Trade Adjustment Assistance Center (NWTAAC)

A Montana manufacturer of high performance laser diode and fiber
optic control, test and measurement products used in research
laboratories, telecommunication, and photonic production facilities
received TAAF certification in 2005 based on a 74 percent increase in
imports of these devices from China and Japan. Implementation of TAAF-
funded projects such as extensive CE product testing, lean
manufacturing and training, and sales market analysis and development
over a 5 year period have resulted in firm product expansion into
European markets, and increased penetration into China, Japan, and
Korea. As a result of NWTAAC assistance and TAAF-funded technical
assistance, as of the end of 2011, employment has stabilized and sales
have increased 48 percent since certification, with export sales now
comprising 50 percent of total sales, a 22 percent increase since
entering the program.
An Idaho light duty manufacturer of sheet metal and plastic
ventilation and roofing components was certified for TAAF in 2010 based
on a 20 percent decline in sales resulting from increased imports from
China, Canada, and Mexico. TAAF-funded technical assistance projects
thus far have included Web site redesign and a two[hyphen]phased search
engine optimization project. As a result of these projects the firm has
gone from zero exports and internet orders to over 300 new orders per
month to customers all over the U.S. and Canada with about 75 percent
of the orders coming from repeat customers. This increase in sales of
$400,000 from two years ago provides better profit margins with 10-to-
15 percent of the sales going to Canada. The firm has also increased
employment by about 2.5 full time employees and is about to add another
just for parcel packaging for the internet orders. As an added benefit,
this new nationwide customer base gives this firm a better idea of what
people want, and these sales are much more profitable than their
wholesale business.

Rocky Mountain Trade Adjustment Assistance Center (RMTAAC)

Faced with intense foreign competition and an increasingly
competitive market, a Utah manufacturer of plastic folding tables and
chairs contacted RMTAAC in 2010 for assistance to improve the firm's
competitive position. RMTAAC conducted a thorough business assessment
and competitive analysis to identify strategic areas for improvement to
build a more solid foundation for future growth. The firm was awarded
technical assistance through the TAAF program to target cost reductions
in its manufacturing processes. The firm has been able to utilize TAAF-
funded technical assistance to shift its efforts to a firm-wide lean
manufacturing initiative. The firm implemented lean manufacturing to
reduce wasteful or non-value added activities in the manufacturing
process. The firm has seen a 25 percent reduction in inventory carrying
costs since applying lean manufacturing principles. In addition, the
firm's sales are up 27 percent since

[[Page 77245]]

entering the TAAF program two years ago.
A South Dakota manufacturer of industrial cleaning machinery had
noted increased competition from foreign countries. Over the last
decade, consolidation has been a significant trend in the industrial
machinery industry. As larger multi-national conglomerates have gained
scale in their operations through acquisitions, the competitive
challenges continue to mount for smaller manufacturers in the industry.
The firm contacted RMTAAC in 2010 for assistance with TAAF
certification. Upon certification, RMTAAC worked with the firm to
develop a customized business recovery plan (AP) focused on
implementing strategic improvements to strengthen the firm's
competitiveness in the global marketplace. Between July 2011 and
December 2011, the firm developed a customized sales and marketing
program. To date, the firm's sales have increased 18.8 percent from the
previous year, and the quote-to-order conversion rate has increased 7
percent. As a result of TAAF-funded technical assistance, the firm's
sales are at a 72-year high.

Southeastern Trade Adjustment Assistance Center (SETAAC)

After losing sales to a major customer in 2000, a Georgia
manufacturing firm ended an era of selling a complete textile machine
to a U.S. customer. The impact of low-cost textile imports from China
and Mexico was devastating the firm's domestic customers. In 2006, as
sales and employment continued to decline, the firm turned to the TAAF
program for help. The SETAAC team developed a customized business
recovery plan (AP) which focused on planning and implementing strategic
improvements to strengthen the firm's competitiveness in the global
marketplace. With TAAF-funded technical assistance, the firm received
certification from the Historically Underutilized Business Zone
(HUBZone) program, which helps small businesses in urban and rural
communities gain access to Federal procurement opportunities. The firm
also redesigned its Web site and other marketing materials in order to
appeal to a broader client base. The work paid off, as the firm now
provides an ammunition testing system for the Air Force. As a result of
TAAF-funded technical assistance, the firm has increased employment by
37 percent and revenue by 10 percent. At the end of the first quarter
of 2012, the firm was on track for a 25 percent increase in revenue
over 2011.
Based in South Carolina, a producer of screens for rotary screen
textile printing experienced a 22 percent loss in sales from 2008 to
2009 as a result of Chinese competitors. To address the issue of
foreign competition, the firm applied for and was certified for TAAF in
2009. The SETAAC team outlined key projects to help the firm increase
its competitive edge. With consultants from the South Carolina
Manufacturing Extension Partnership (SCMEP), the firm was able to
transition from textile-based screen engraving to digital printing of
designs directly to fabric by using a new brand. Projects performed by
the SCMEP included Web site redesign, organic search engine
optimization, lead generation and pay-per-click advertising. This
outreach lead the firm to an opportunity with a large promotional and
graphic communications firm with over 750 member locations in the U.S.
and Canada. Since the initiation of this project, annual sales have
steadily increased by over $220,000. May 2012 saw a 50 percent sales
increase, and June 2012 as the highest sales month in four years. In
addition to increasing sales, the firm has also added three additional
employees.

Southwest Trade Adjustment Assistance Center (SWTAAC)

A Texas manufacturer of uniforms, industrial safety, and
rehabilitation equipment was certified for TAAF in 2008. The firm had
experienced a 21 percent decline in sales and 31 percent decline in
employment since the previous year. The foreign impact was traced to
imports from China, Bangladesh, Indonesia, Mexico and the Caribbean
basin countries. The firm received EDA approval of an AP focusing on
technical assistance in the areas of strategic marketing, Enterprise
Resource Planning (ERP) implementation, and lean manufacturing
techniques. To date, the firm has worked on four marketing projects,
which included photography of their products, a complete redesign of
their marketing materials such as catalogs, brochures, and press
packages, along with product imaging improvements and a branding
strategy. Management information systems projects integrated the firm's
MAS 200 SAGE accounting software to interface with their Web site
projects to streamline and improve the functionality of accounting,
inventory control, on-line customer ordering accessible year round (24
hours a day) with the capability to track orders by oilrig number/
employee, and create automated customized reports. The firm has
completed 99 percent of their projects and seen a dramatic increase in
sales. They recorded sales of $20.9 million in 2011 and an employment
of 30, an increase of 345 percent and 25 percent respectively since the
date of certification.
A Louisiana manufacturer of Creole pralines and a variety of other
pecan-based confections was adversely impacted by imports from Canada,
Mexico, and Thailand. The firm was certified for TAAF in May 2009. At
the time of certification, annualized sales were approximately $2.7
million, down from $3.3 million the previous year. The firm AP project
plans included a support system upgrade required to make significant
Management Information System (MIS) upgrades. Although they had an MIS
system, it did not have the capacity to allow the firm to manage their
increasingly diversifying business. Although implementation of the
projects outlined in their business recovery plan is ongoing, the firm
has fared better than many other firms that are recovering from the
aftermath of not only Hurricane Katrina, but also the generalized
impact of the recession during this period. Annual sales two years from
the date of certification grew to $3.6 million--an annualized growth
rate of roughly 15 percent.

Western Trade Adjustment Assistance Center (WTAAC)

A California custom packaging manufacturer serving customers in the
medical, food, and electronics industries suffered injury from import
competition from Asia from 2004 through 2006. Its customers increased
the purchase of packaging solutions made in the Pacific Rim. A severe
downturn in the static packaging industry resulted in the Pacific Rim
producing the bulk share of electronic components. The firm was
certified for TAAF in December of 2006. WTAAC and the firm's management
developed a strategy to change the way the customers think about
flexible barrier packaging and to provide new ideas to industry to use
this packaging. Specifically, the goal was to develop innovative ways
of using barrier packaging to enter the advertising niche, a market
segment that has not previously used flexible packaging. The firm
completed the implementation phase of the TAAF program in January 2010.
While active in the program, the firm implemented its marketing project
and two information technology projects. Since TAAF certification,
sales increased 34 percent, employment increased 28 percent,
profitability

[[Page 77246]]

increased 68 percent, and productivity increased 4 percent.
A second-generation California bonding wedge manufacturer,
specializing in the design and manufacture of bonding wedges for the
microelectronics industry was suffering from continued shrinking market
share due to increasing competition from low price Pacific Rim
manufacturers from 2000 to 2002. As a result, 2002 annual sales
decreased 44 percent and employment decreased 34 percent. The firm was
certified for TAAF in October of 2002. WTAAC and the firm's management
developed a strategy for the firm to specialize in the manufacture of
high quality bonding wedges for the microelectronic industry while
expanding its brand sales and diversifying its customer base. The firm
successfully completed the implementation phase of the TAAF program in
February 2009. While active in the program, the firm implemented two
quality management system projects, three production engineering
projects, four marketing and promotion projects, and one information
technology project. These projects focused on significantly expanding
international sales while improving manufacturing efficiency, reducing
production cost and shortening cycle times. Since TAAF certification,
the firm regained profitability, with sales increasing 45 percent, and
productivity improving 45 percent.

Dated: December 21, 2012.
Miriam Kearse,
Eligibility Examiner.
[FR Doc. 2012-31377 Filed 12-28-12; 8:45 am]
BILLING CODE 3510-WH-P

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