The Medford airport?s Foreign Trade Zone will be rendered inactive if Jackson County buys out a lease agreement with Ore-Cal Trade Corp. It could be reactivated if the right business comes along, county officials say. Mail Tribune / Bob Pennell - Mail Tribune Bob Pennell

Trade Zone may go dormant

9/11, NAFTA have undercut the airport zone's prospects, says its main proponent

After losing the U.S. Customs office last year, Medford airport officials could soon pay &

36;1.9 million to terminate a lease with the operators of the Foreign Trade Zone.

The need for an international trade zone isn't what it was in the past, said Mike Burrill Sr. of Ore-Cal Trade Corp., which leased 97 acres on the east side of the airport.

The North American Free Trade Agreement, other international trade agreements and the 9/11 terrorist attacks have undermined the ability to operate the zone that allows manufacturers to store items tax-free until they are ready to be used, he said.

When Ore-Cal took over the lease 10 years ago, it had the U.S. Customs, the trade zone and immigration offices. Now, only the immigration offices remain, along with some storage and other offices.
County commissioners, who oversee airport operations, are scheduled to consider the termination of the 60-year lease at their 9:30 a.m. board meeting Wednesday in the Jackson County Courthouse auditorium. There are 49 years left on the lease.

Airport Director Bern Case said the trade zone will be kept in an inactive status, but could be reopened if the right kind of business came along.

It's like an ace in the hole, he said.

There are no plans to change the official name of the airport, which is the Rogue Valley International-Medford Airport.

Case said the international designation has helped the airport receive about &

36;16 million in grants that have paid for a runway extension and improved airplane parking facilities.

In the next few years, the airport will build a new terminal and parking area, followed by a new tower.

The airport is growing so fast that the 97 acres will be put to good use, with some businesses already expressing interest in locating there, said Case.

The airport is only 1,000 acres and we have one-tenth of it tied up, he said. It will make the airport more versatile.

He envisions the east side of the airport playing host to commercial businesses that need to be close to an airport.

Case said &

36;1 million of the lease buyout will come from reserves, &

36;400,000 from contingency funds, and the rest from a general reserve fund set aside for the new terminal.

No tax money will be needed, he said.

This reimburses Ore-Cal for money paid to house U.S. Customs and for marketing the trade zone.

Burrill said most of the money will pay off a loan Ore-Cal had for the project.

While he doesn't see the undertaking as a failure, Burrill said, We would rather go back and do what we do best, referring to his real estate operations.

Commissioner Jack Walker said terminating the lease will allow the airport to bring in other business ventures in the future.

I think it's in the best interest of Jackson County at this time to take the Foreign Trade Zone back, he said.
History of the airport's international status

October 1994:

Medford-Jackson County Airport becomes an international airport with the arrival of the U.S. Customs Service office.

December 1994:

The airport receives its first international shipment ' cut flowers from Honduras.

March 1995:

Medford's first international passenger flight arrives ' a pilot and an executive on a private plane from Canada.

March 1995:

The airport is renamed the Rogue Valley International-Medford Airport after a countywide contest. The winners: Rosemary Harrington and Jim Rock.

September 1995:

A Foreign Trade Zone, which allows manufacturing and distribution outside of U.S. Customs, is activated at the airport.

June 2001:

Horizon Air stops carrying international cargo, perishables or single shipments over 100 pounds.

January 2003:

U.S. Customs Service pulls out of Medford, effectively deactivating the Foreign Trade Zone and making the Medford airport international in name only.

July 2004:

Airport officials want to terminate the airport's lease with Ore-Cal Trade Corp., which runs the mothballed Foreign Trade Zone.

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