Thursday, April 24, 2014
WASHINGTON – Members of Maine's congressional delegation are trying to keep up the pressure on the Department of Defense to buy footwear from U.S. manufacturers, a move that would likely benefit the state's New Balance sneaker factories.
In this May 2011 file photo, Ashley Smith stitches shoes at New Balance in Norridgewock.
Shawn Patrick Ouellette / Staff Photographer
Sharon Estes laces shoes at New Balance’s Norridgewock factory. The company employs roughly 900 people in factories in Norridgewock, Skowhegan and Norway, Maine.
Press Herald file photo/Shawn Patrick Ouellette
Under a 1941 federal law known as the Berry Amendment, the military is generally required to supply personnel with uniforms and equipment made domestically. But the Army and the Air Force issue vouchers or give allowances to new recruits to purchase athletic footwear for physical training, thereby exempting athletic footwear from the Berry Amendment in the eyes of the Department of Defense.
Members of Maine's delegation as well as some other members of Congress disagree, however. This past week, Maine's representatives introduced two bills -- one each in the House and Senate -- that aim to close what they claim is a loophole in the law. The measures would treat athletic shoes the same as any other uniform item.
"This is something the Obama Administration can do right now to boost the economy and ensure that our military is outfitted from head to toe in American-made uniforms," Rep. Mike Michaud, D-District 2, said in a statement.
Michaud was joined on the bill by Rep. Chellie Pingree, D-District 1. The Senate version is co-sponsored by Republican Sen. Susan Collins and independent Sen. Angus King.
"The president said in his State of the Union address that one of his top priorities is making America a magnet for new jobs and manufacturing. We share this priority," Collins said in a statement. "One way we can make that possible without increasing the federal deficit a single dime is to make sure that the athletic footwear purchased every year by entry-level military recruits is manufactured by U.S. companies like New Balance."
New Balance employs roughly 900 people at factories in Skowhegan, Norridgewock and Norway, and operates two facilities in Massachusetts as well. The company also manufacturers sneakers overseas but is one of the last remaining major sneaker manufacturers in the U.S.
Matt LeBretton, director of public affairs at New Balance, said compliance requirements under the Berry Amendment are much stricter than under the traditional "Made in the U.S.A." label. All products used to manufacture the shoe must come from domestic sources, he said.
Berry-compliant shoes also must meet different standards than typical consumer shoes, he said. New Balance would be one of multiple shoe manufacturers that would bid competitively to supply athletic footwear, but LeBretton estimated that 200 jobs would be created if all of the military branches bought Berry-compliant shoes for physical training just as they do for boots and dress footwear.
"To us, it is significant," LeBretton said. "At the end of the day, it's not necessarily a money-making opportunity. Really it is about predictability and following the letter of the law."
Delegation members have also written letters to President Obama and Pentagon officials asking that the military branches follow the Berry Amendment requirements for athletic footwear.
The Berry Amendment is not the only area where the delegation is working with New Balance to lobby the Obama administration. They are also asking to preserve tariffs on foreign-made sneakers as the administration negotiates another free-trade agreement, known as the Trans-Pacific Partnership, with Pacific nations from Australia to Peru.
Free trade agreements, which need approval from Congress, are sought after by business groups that perceive them as opening up additional markets but are controversial among businesses that fear impacts on their domestic manufacturing.
Aspects of the so-called "TPP" would likely benefit some business sectors in Maine by expanding their export potential. But several of the countries included in the so-called "TPP" -- such as Vietnam -- have major sneaker-manufacturing sectors, raising concerns at New Balance and other domestic manufacturers about having to compete against manufacturers in low-wage countries if tariffs are eliminated.
Last year, the Obama administration's top trade official, Trade Ambassador Ron Kirk, toured several New Balance factories in Maine and spoke with employees after meeting with company representatives in Washington several months earlier.
Afterward in a meeting with the Portland Press Herald, Kirk was careful to emphasize that the administration was not making any promises with regard to preserving the tariffs that New Balance officials have said are key to remaining competitive with overseas manufacturers.
Kirk said tariffs are often reduced in stages while, in other instances, the elimination is delayed for five to 10 years to give the U.S. manufacturers time to respond. Kirk has since stepped down. Negotiations on the TPP -- which was recently expanded to include Japan -- are ongoing.
"We have yet to get any type of assurance from the Obama administration that our interests will be maintained in the agreement, so we are still very nervous about the Trans-Pacific Partnership," New Balance's LeBretton said.
Kevin Miller can be contacted at 317-6256 or at:
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Debbie Foss washes shoes at the New Balance factory in Norridgewock. New Balance is one of the last remaining sneaker makers in the U.S.
Press Herald file photo/Shawn Patrick Ouellette