Help us find specific legislation excluding Tootsie Roll Inc from paying sugar tariff
December 9, 2010 5:13 PM   Subscribe

GoogleFu Failure Filter: Help us find specific legislation excluding Tootsie Roll Inc from paying sugar tariff

I'm doing a group paper on tootsie roll inc. the company's CEO, Melvin Gordon, somehow convinced Dan Rostienkowski, a representative from IL to give the company a foreign trade exemption on sugar. we have all the sources talking about the exemption (aka what comes up on google when you search "tootsie" "free trade zone"), but we can't find the exact legislation. we think it's in a farm bill or an omnibus bill written in 1990.

is there a specific website that lets you easily search legislation for the word "tootsie"? we are at a research university with all the information access that entails.

posted by nanhey to Law & Government (13 answers total) 3 users marked this as a favorite
that should be Dan Rostenkowski (no 'i' after the t)
posted by nanhey at 5:17 PM on December 9, 2010

I don't necessarily trust this article too much, but it looks like the factory is located in the Illinois International Port District's Lake Calumet Harbor foreign trade zone, which would skirt the tariffs.
posted by Mister Fabulous at 5:20 PM on December 9, 2010

I just tried searching for "Tootsie" on Thomas and got no results. Most of the time, legislation like this doesn't mention specific company names. Instead, it'll say something like "this provision applies to all companies with [number of employees Tootsie Roll has] employees, based in [city where Tootsie Roll is based] with annual revenues of no less than [Tootsie Roll's annual revenues] and an annual tax liability of [Tootsie Roll's tax liability]. In other words, they create legislation that theoretically applies to anyone who fits the criteria, but the criteria are specific enough to push most other companies out. So you may need to substantially broaden your search criteria. If I were you, I'd go to your school or local library and ask the librarian for help finding the information you need.
posted by decathecting at 5:25 PM on December 9, 2010

According to a 1988 subcommittee briefing, your timing is off:
In 1984, Tootsie Roll company, a maker of penny candy, established sugar blending operations in a Free Trade Zone located at Lake Calumet Harbor in Chicago, Illinois.
In any case, what you're looking for is THOMAS full text search, which turns up some results for "Calumet" in 1990, but I can't find the specific text. It will probably require some close reading.
posted by shii at 5:27 PM on December 9, 2010

Here's what you were looking for:
The Foreign-Trade Zones Board has given the Chicago Regional Port District authority to establish, operate and maintain a foreign- trade zone (No. 22) in the Lake Calumet Harbor area.
Traffic World 1975
posted by shii at 5:36 PM on December 9, 2010

Following up on shii's research, I took a look at the Foreign-Trade Zones Board website (which, incidentally, I had never heard of before). I looked here for Zone 22 and the closest matches I could find were these two notices that appear to grant a company called Power Packaging, Inc. exemption from sugar import duties. Is/was Power Packing related to the Tootsie Roll company?
posted by mhum at 6:16 PM on December 9, 2010

Thanks for the help so far! Power Packing seems like separate entity not related to Tootsie. Tootsie Roll definitely has a sugar mixing facility within this foreign trade zone No 22...but I still can't find the language exempting them from the tariff.
posted by nanhey at 6:29 PM on December 9, 2010

Yeah, it looks like Power Packaging, Inc. really is a completely unrelated company. And, there doesn't appear to be any mention of Tootsie Roll in anything on the Foreign-Trade Zones Board site.
posted by mhum at 6:36 PM on December 9, 2010

According to what I saw, goods in a Foreign Trade Zone are officially classed as not having entered the US, so there'd be no opportunity to apply the tariff in the first place. I'd look up the legal language about the zones.
posted by shii at 6:38 PM on December 9, 2010

Hmm. According to this case, it looks like Tootsie Roll uses a subsidiary called Sweets Mix to actually avoid the sugar duties:
Sweets Mix, located at Lake Calumet Harbor, is a wholly owned subsidiary of Tootsie Roll Industries.   It purchases domestic and foreign sugar and makes it into sweeteners for use by Tootsie Roll Industries.   The factory's location is designed to take advantage of a “foreign trade zone,” which offers financial advantages by processing raw sugar before it is technically admitted into the United States via customs. [...]

The Sweets Mix factory is the sole source of sugar for candy production by Tootsie Roll Industries.   Though Sweets Mix is actually a separate corporation, all of the officers of Sweets Mix are also on the board of Tootsie Roll Industries, though the same is not true vice versa.
posted by mhum at 7:01 PM on December 9, 2010

I'm guessing that if they're in a FTZ, the tariff they would be charged on raw sugar must be higher than what they are charged on the finished product.

Running a search for "Tootsie Roll HTSUS" (HTSUS being the Harmonized Tariff Schedule of the United States), I got a hit saying that "Tootsie Roll Midgees" are classified under 1806.32.9000, which gives a 6% (General) tariff (but free if entered under one of several FTAs), and 40% from other countries.

Various types of sugars can have really ugly tariffs attached to them, some up to 40 cents per kg, or, in other case, up to 12% of value-- even in the "General" category, where tariffs are usually lowest. Sometimes even a combination of a per-kg charge and an ad valorem charge.

I don't know what kind of sugar they use, but it's not unreasonable to assume they're taking advantage of some kind of split in applicable tariffs between raw and finished product.
posted by holterbarbour at 7:18 PM on December 9, 2010

Meanwhile, you can get the entire text of the 1988 subcommittee hearing that shii linked to earlier here. There's some interesting stuff in there; search for "Tootsie Roll".
posted by mhum at 7:19 PM on December 9, 2010

Thanks a lot for the help!
posted by nanhey at 8:01 PM on December 9, 2010

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