2010 Grant Funds for Worsted Wool Fabric Mfrs Available, Termination Proposed for 2011

Grant applications must be received or postmarked by 5:00 p.m. Eastern Daylight Time on August 20, 2010.

(P.L. 109-280 extended the availability of the grant funds through 2009 and modified the eligibility criteria to state that only manufacturers who weave worsted wool fabric in the U.S. shall be eligible for a grant. See ITT's Online Archives or 08/16/06 news, 06081610 for BP summary.

The Emergency Economic Stabilization Act of 2008 (Public Law 110-343) extended availability of grant funds through 2014. See ITT’s Online Archives or 10/20/08 news, 08102099 #3, for BP summary.)

Grants for 1999-2001 Manufacturers that Weave Fabric as of Application Date

P.L. 108-429, as amended, authorizes the Secretary of Commerce to provide grants to persons (including firms, corporations, or other legal entities) who were, during calendar years 1999, 2000, and 2001, manufacturers of two categories of worsted wool fabrics:

1. worsted wool fabric: containing 85 percent or more by weight of wool, with average fiber diameters greater than 18.5 micron (HTS 9902.51.11), and/or
2. worsted wool fabric: containing 85 percent or more by weight of wool, with average fiber diameters of 18.5 micron or less (HTS 9902.51.15¹).

Only manufacturers who weave worsted wool fabric in the U.S. as of the date of application shall be eligible for such grant funds.

(In addition, any manufacturer who becomes a successor-of-interest to a manufacturer of the worsted wool fabrics described in HTS 9902.51.11 or HTS 9902.51.15 during 1999, 2000 or 2001 because of a reorganization or otherwise, shall be eligible to apply for such grants.)

Grant Total of $2,666,000 for Each Fabric Type

Funding for the worsted wool fabrics grant program will be provided by the Department of the Treasury from amounts in the Wool Apparel Manufacturers Trust Fund. The total amount of grants to manufacturers of worsted wool fabrics shall be $2,666,000 for wool fabrics described in HTS 9902.51.11, and $2,666,000 for wool fabrics described in HTS 9902.51.15 in calendar year 2010.

Grants Allocated Based on Production Percentage

P.L. 108-429 also requires that each grant be allocated among eligible applicants on the basis of the percentage of each manufacturers' production of the fabric described in HTS 9902.51.11 or HTS 9902.51.15 for calendar years 1999, 2000, and 2001, compared to the production of such fabric by all manufacturers who qualify for such grants.

ITA Has Proposed to Terminate Worsted Wool Grant Program in 2011

As part of its fiscal year 2011 budget request, ITA requested a decrease of $5.3 million to eliminate these worsted wool grants. ITA stated that eligible manufacturers have already received approximately $25 million in subsidies over the past five years to invest in the productivity improvements necessary to counter increased foreign competition.

According to the ITA's budget proposal, continued "adjustment" subsidies are not warranted and the Administration is proposing to terminate the program in 2011.(See ITT’s Online Archives or 02/18/10 news, 10021820, for BP summary.)

(See ITT’s Online Archives or 07/06/10 news, 10070607, for BP summary of the ITC’s July 1, 2010 version of HTS, which includes the extension of the expiration dates for the Chapter 99 numbers for worsted wool fabrics.)

¹previously 9902.51.12 (2004)

(FR Pub 08/06/10, D/N GF001)