[Federal Register Volume 75, Number 10 (Friday, January 15, 2010)]
[Notices]
[Pages 2491-2510]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-561]


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DEPARTMENT OF COMMERCE

Economic Development Administration


Trade Adjustment Assistance for Firms Program Fiscal Year 2009 
Annual Report

AGENCY: Economic Development Administration, Commerce.

Action: Notice.

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

SUMMARY: The Secretary of Commerce is directed by Section 1866 of the 
Trade and Globalization Adjustment Assistance Act of 2009 (TGAAA), 
which became effective May 17, 2009, to submit to Congress a report on 
the Trade Adjustment Assistance for Firms (TAAF) program by the 15th of 
December each year. The TAAF Program is one of four Trade Adjustment 
Assistance (TAA) programs authorized by the Trade Act of 1974 (Trade 
Act). The mission of the TAAF Program is to provide technical and 
financial assistance to U.S. firms affected by import competition. The 
program provides assistance in the development of business recovery 
plans, which are known as Adjustment Proposals under Section 252 of the 
Trade Act, and matching funds to implement projects outlined in the 
Adjustment Proposals. The TAAF Program supports a national network of 
11 Trade Adjustment Assistance Centers (TAACs) to help U.S. firms apply 
for assistance and prepare and implement strategies to guide their 
economic recovery.
    Overall, there has been an increase in the demand for the TAAF 
Program in fiscal year 2009, as demonstrated by the increase in the 
number of petitions for certification and Adjustment Proposals 
submitted to EDA for approval.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                           Avg. days        Avg. days
                                                       Petitions        Petitions        Petitions        Petitions         between          between
                    Fiscal year                         received       accepted for      certified          denied       submission and   acceptance and
                                                                          filing                                           acceptance     certification
--------------------------------------------------------------------------------------------------------------------------------------------------------
2009..............................................              281              247              212                1               28               45
2008..............................................              188          \1\ 190              183                0               11               45

[[Page 2492]]

 
Change............................................              49%              30%              16%               NA             155%               NA
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Two of the petitions accepted for filing in FY 2008 were received by EDA in FY 2007.

    Because of the spike in petitions and Adjustment Proposals, the 
Economic Development Administration (EDA) experienced challenges in 
meeting the 40-day processing deadline for petitions accepted for 
filing immediately after the new legislation was enacted. Beginning in 
the fourth quarter of FY 2009, the average processing time for 
petitions has started to decline below the 40-day requirement. 
Additional TAAF staff resources are expected to help improve the 
processing time even further for FY 2010.
    TAACs effectively reached small and medium-sized firms in FY 2009. 
The average employment, net sales, and productivity of firms certified 
in FY 2009 declined in comparison to the previous fiscal year. Sixty-
five percent of all firms proposed to implement a marketing/sales 
project or production/engineering project in their Adjustment 
Proposals, and 35 percent of all firms proposed support systems or 
management/financial projects.

----------------------------------------------------------------------------------------------------------------
                                                                                                       Avg.
                                                               Avg. employment  Avg. annual net  productivity at
                              FY                                      at            sales at      certification
                                                                certification    certification    (net sales per
                                                                                                    employee)
----------------------------------------------------------------------------------------------------------------
2009.........................................................               77      $10,715,785         $128,729
2008.........................................................               82      $13,081,993         $149,565
% Change.....................................................             (6%)            (18%)            (14%)
----------------------------------------------------------------------------------------------------------------

    The following table illustrates that in FY 2009 EDA approved an 
additional 33 Adjustment Proposals as compared to FY 2008 and proposed 
to spend an additional total of $2.4 million in government funds.

                                       Approved TAAF Adjustment Proposals
----------------------------------------------------------------------------------------------------------------
                                      FY 2003    FY 2004    FY 2005    FY 2006    FY 2007    FY 2008    FY 2009
----------------------------------------------------------------------------------------------------------------
Number of Plans Approved...........        162        177        132        137        126        139        172
Total Government Share (millions)..       $8.1       $8.5       $5.9       $6.7       $7.1       $7.9      $10.3
Total Firm Share (millions)........       $7.4       $8.1       $5.4       $6.0       $5.9       $7.5       $9.8
Total Projected Costs (millions)...      $15.5      $16.6      $11.3      $12.7      $13.0      $15.4      $20.2
Avg. Government Assistance Per Firm    $50,000    $48,023    $44,697    $48,905    $56,449    $56,827    $60,123
----------------------------------------------------------------------------------------------------------------

    The TGAAA identifies 14 measures that should be covered by this 
report. EDA currently is unable to provide any information on four 
measures: (1) The number of firms that inquired about the program, (2) 
the number of petitions certified by congressional district, (3) the 
number of firms leaving the program and why, and (4) sales, employment, 
and productivity at each firm upon completion of the program and every 
year for the two years thereafter. EDA is taking steps to collect and 
report on all of the missing measures for the FY 2010 Annual Report.

ADDRESSES: Trade Adjustment Assistance for Firms Division, Room 7106, 
Economic Development Administration, U.S. Department of Commerce, 
Washington, DC 20230.

FOR FURTHER INFORMATION CONTACT: Bryan Borlik, Director of the TAAF 
Program, 202-482-3901.

SUPPLEMENTARY INFORMATION:

Table of Contents

Introduction
Program Initiative
Program Description
Data for This Report
Results/Findings

    (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.
    (4) The average time for processing petitions.
    (5) The number of petitions filed and firms certified for each 
Congressional district of the United States.
    (6) The number of firms that received assistance in preparing 
their petitions.
    (7) Sales, employment, and productivity at each firm 
participating in the program at the time of certification.
    (8) The number of firms that received assistance developing 
business recovery plans (Adjustment Proposals).
    (9) The number of Adjustment Proposals approved and denied by 
the Secretary of Commerce.
    (10) The financial assistance received by each firm.
    (11) The financial contribution made by each firm.
    (12) The types of technical assistance included in the 
Adjustment Proposals of firms participating in the program.
    (13) The number of firms leaving the program before completing 
the project or projects in their Adjustment Proposals and the reason 
the project was not completed.
    (14) Sales, employment, and productivity at each firm upon 
completion of the program and each year for the two-year period 
following completion.

Discussion and Analysis
Conclusion

Introduction

    This report is provided in compliance with Section 1866 of the 
Trade and Globalization Adjustment Assistance Act of 2009 (Sec. 1866, 
Pub. L. 111-5, 123 Stat. 115, at 367) (TGAAA). This section directs the 
Secretary of Commerce to provide an annual report

[[Page 2493]]

on the Trade Adjustment Assistance for Firms (TAAF) program by the 15th 
of December each year. Section 1866 of the TGAAA states:

    IN GENERAL.--Not later than December 15, 2009, and each year 
thereafter, the Secretary of Commerce shall prepare a report 
containing data regarding the trade adjustment assistance for firms 
program provided for in chapter 3 of title II of the Trade Act of 
1974 (19 U.S.C. 2341 et seq.) for the preceding fiscal year.

    This report will provide findings and results to the extent that 
the data is available on the following 14 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.
    4. The average time for processing petitions.
    5. The number of petitions filed and firms certified for each 
congressional district of the United States.
    6. The number of firms that received assistance in preparing their 
petitions.
    7. The number of firms that received assistance developing business 
recovery plans (Adjustment Proposals).
    8. The number of Adjustment Proposals approved and denied by the 
Secretary of Commerce.
    9. Sales, employment, and productivity at each firm participating 
in the program at the time of certification.
    10. Sales, employment, and productivity at each firm upon 
completion of the program and each year for the two-year period 
following completion.
    11. The financial assistance received by each firm participating in 
the program.
    12. The financial contribution made by each firm participating in 
the program.
    13. The types of technical assistance included in the Adjustment 
Proposals of firms participating in the program.
    14. The number of firms leaving the program before completing the 
project or projects in their Adjustment Proposals and the reason the 
project was not completed.
    The TAAF program is one of four Trade Adjustment Assistance (TAA) 
programs authorized under the Trade Act of 1974 (19 U.S.C. 2341 et seq) 
(Trade Act). The responsibility for administering the TAA for Firms 
program is delegated by the Secretary of Commerce to the Economic 
Development Administration (EDA). EDA, through a national network of 11 
Trade Adjustment Assistance Centers (TAAC), provides technical 
assistance on a cost-shared basis to U.S. manufacturing, production, 
and service firms in all fifty states, the District of Columbia, and 
the Commonwealth of Puerto Rico.
    The other TAA programs are TAA for Workers, Farmers, and 
Communities, which are administered by the Departments of Labor, 
Agriculture, and Commerce through EDA, respectively.
[GRAPHIC] [TIFF OMITTED] TN15JA10.019

    The TAAF Program is relatively small. Between FY 2000 and FY 2009, 
its appropriations have ranged from $10.5 million to $15.8 million.

Program Initiative

    The mission of the program is to provide technical and financial 
assistance to U.S. firms affected by import competition. The program 
provides assistance in the development of business recovery plans, 
which are known as Adjustment Proposals under Section 252 of the Trade 
Act, and matching funds to implement projects outlined in Adjustment 
Proposals.
    The program's premise is that some U.S. firms, in particular small 
businesses, lack the internal capabilities or resources necessary to 
effectively respond to new import competition. The Trade Adjustment 
Assistance Centers' goal is to help U.S. firms increase profitability 
and retain employees while competing successfully in the global 
economy.

Program Description

    The TAAF Program supports a national network of 11 Trade Adjustment 
Assistance Centers (TAAC) to help U.S. firms apply for assistance and 
prepare and implement strategies to guide their economic recovery. 
Information about the TAACs may be found at www.taacenters.org. The 
current TAACs and the states they serve are listed in the table below. 
Please note that currently Puerto Rico has not been assigned to any 
particular TAAC. Firms

[[Page 2494]]

in Puerto Rico receive assistance from the TAAC that received the 
inquiry.

           Exhibit 2--TAACs and Their Respective Service Areas
------------------------------------------------------------------------
                      TAAC                             States served
------------------------------------------------------------------------
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.
Northwestern....................................  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, and
                                                   Tennessee.
Southwest.......................................  Louisiana, Oklahoma,
                                                   and Texas.
Western.........................................  Arizona, California,
                                                   Hawaii, and Nevada.
------------------------------------------------------------------------

    The TAACs' main responsibilities are:
     Assisting firms in preparing their petitions for TAAF. 
Firms are not charged for any assistance related to preparing a 
petition.
     Once a petition has been approved, TAACs work closely with 
company management to identify the firm's strengths and weaknesses and 
develop a customized Adjustment Proposal designed to stimulate recovery 
and growth. The program pays up to 75% of the cost of developing an 
Adjustment Proposal and the firm must pay the rest. EDA must approve 
all Adjustment Proposals to ensure they conform to statutory and 
regulatory requirements.
     After an Adjustment Proposal has been approved, company 
management and TAAC staff jointly identify consultants with the 
specific expertise required to assist the firm. The program pays up to 
$75,000 in matching funds for the cost of these consultants when 
implementing the Adjustment Proposal. After a competitive procurement 
process, the TAAC and the firm generally contract with private 
consultants to implement the adjustment plan.
    There are three main phases to receiving technical assistance under 
the program. The phases are (1) Petitioning for certification, (2) 
recovery planning, and (3) project implementation.
[GRAPHIC] [TIFF OMITTED] TN15JA10.020

    Eligibility to Apply for Trade Adjustment Assistance'' and any 
supporting documentation. Although a firm may complete a petition and 
submit it to EDA on its own, certification specialists within the TAACs 
generally work with the firm at no cost to complete and submit a 
petition to EDA. Once a petition has been accepted, EDA is required to 
make a final determination on a petition within 40 days.\2\
---------------------------------------------------------------------------

    \2\ 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.
---------------------------------------------------------------------------

    Certified firms may then submit an Adjustment Proposal for EDA's 
approval. It generally takes EDA between two weeks to one month to make 
a final determination on an Adjustment Proposal, depending on the 
workflow.
    The firm works with consultants to implement projects in an 
approved Adjustment Proposal. As projects are implemented and if the 
firm is satisfied

[[Page 2495]]

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 Adjustment Proposal's approval to implement it, unless 
they receive approval for an extension. Generally, firms complete the 
implementation of their Adjustment Proposals over a two-year period.

Data for This Report

    Most of the data used in this report were collected from the 
petitions for certification and the Adjustment Proposals submitted by 
the TAACs on behalf of firms. Data from these sources were recorded 
into a central database by Eligibility Reviewers at EDA. Results for 
average processing times and the number of approved and denied 
petitions and Adjustment Proposal were derived by EDA.
    All of the data available for Fiscal Years (FY) 2009 and 2008 were 
used for this report. One weakness to the data sets used is that a few 
records were incomplete. EDA has identified data collection 
deficiencies and plans to train EDA and TAAC staff in order to 
eliminate, to the extent possible, problems that result in incomplete 
records.
    The performance measures in this report were evaluated by looking 
at quarterly trends and comparing results for FY 2009 and FY 2008. In 
addition, characteristics of the petitioning and certified firms were 
aggregated and reported as averages to provide a general profile for 
these firms.

Results/Findings

    (1) The number of firms that inquired about the program.
    Because of the decentralized nature of the TAAF Program, EDA 
currently does not collect reliable information on the number of firms 
that inquire about the TAA program. EDA is working with the TAACs to 
collect this data and will include this measure in the revised 
quarterly report submitted by the TAACs to EDA. EDA is expecting to 
start collecting this data by the end of December 2009.
    (2) The number of petitions filed under section 251.
    (3) The number of petitions certified and denied.
    (4) The average time for processing petitions.
    In FY 2009, there was a 49 percent increase in the number of 
petitions received by EDA, a 16 percent increase in the number of 
certified firms, and on average the total petition processing time 
increased by 17 calendar days, which period is defined as the period 
between actual submission of a petition by the TAAC and final 
determination, that is certification or rejection, by EDA.
    After accepting a petition for filing, EDA has 40 calendar days to 
make a final determination. In order to avoid having to reject many of 
the petitions, EDA does not consider a petition accepted until all the 
necessary information is collected. When considering the duration 
between the time of submission and when a final determination is made, 
the processing time for petitions increased by 17 days in FY 2009 as 
compared to FY 2008. For the average petition, in both FY 2008 and FY 
2009 it took 45 days to make a final determination after it had been 
accepted for filing under section 251 of the Trade Act.

                                       Exhibit 4--Petitions for Certification FYs 2009 and 2008 Summary Comparison
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                           Average days
                                                             Number of       Number of       Number of       Number of        between      Average days
                           FY                                petitions       petitions       petitions       petitions    submission and      between
                                                             received      accepted for      certified        denied      acceptance for  acceptance and
                                                                              filing                                          filing       certification
--------------------------------------------------------------------------------------------------------------------------------------------------------
2009....................................................             281             247             212               1              28              45
2008....................................................             188           3 190             183               0              11              45
% Change................................................              49              30              16             N/A             155             N/A
--------------------------------------------------------------------------------------------------------------------------------------------------------
\3\ Two of the petitions accepted for filing in FY 2008 were received by EDA in FY 2007.


                                                Exhibit 5--Petitions for Certification by State and TAAC
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           FY 2009 Petitions for Certification
---------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                           Average days
                                                             Number of       Number of       Number of       Number of        between      Average days
               TAAC                        State             petitions       petitions       petitions       petitions      submission        between
                                                             received      accepted  for     certified        denied            and       acceptance and
                                                                              filing                                        acceptance     certification
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   IN...................               7               7               7               0
                                   MI...................              13              11              10               0  ..............  ..............
                                   OH...................               8               7               5               0  ..............  ..............
                                                         ----------------------------------------------------------------
Great Lakes......................     Total.............              28              25              22               0              25              43
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   AR...................               2               2               2               0  ..............  ..............
                                   KS...................               3               2               2               0  ..............  ..............
                                   MO...................              13              10               8               0  ..............  ..............
                                                         ----------------------------------------------------------------
Mid-America......................     Total.............              18              14              12               0              37              49
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   DC...................               0               0               0               0  ..............              41
                                   DE...................               0               0               0               0  ..............  ..............
                                   MD...................               0               0               0               0  ..............  ..............
                                   NJ...................               1               1             4 2               0  ..............  ..............
                                   PA...................              22              18              16               0  ..............  ..............

[[Page 2496]]

 
                                   VA...................               1               1               0               0  ..............  ..............
                                   WV...................               0               0               0               0  ..............  ..............
                                                         ----------------------------------------------------------------
Mid-Atlantic.....................
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                      Total.............              24              20              18               0              32  ..............
                                   IA...................               2               2               1               0  ..............  ..............
                                   IL...................              28              27              23               0  ..............  ..............
                                   MN...................               8               7               6               0  ..............  ..............
                                   WI...................              10               9               6               0  ..............  ..............
                                                         ----------------------------------------------------------------
Midwest..........................     Total.............              48              45              36               0              26              47
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   CT...................              10               9               9               0  ..............  ..............
                                   MA...................              28              25              24               0  ..............  ..............
                                   ME...................               2               1               1               0  ..............  ..............
                                   NH...................               8               8               6               0  ..............  ..............
                                   RI...................               8               8               7               0  ..............  ..............
                                   VT...................               0               0               0               0  ..............  ..............
                                                         ----------------------------------------------------------------
New England......................     Total.............              56              51              47               0              24              35
--------------------------------------------------------------------------------------------------------------------------------------------------------
New York State...................  NY Total.............              16              13              11               0              28              46
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   AK...................               1               0               0               0  ..............  ..............
                                   ID...................               0               0               0               0  ..............  ..............
                                   MT...................               2               1               0               0  ..............  ..............
                                   OR...................               5               6               5               0  ..............  ..............
                                   WA...................               6               5               5               0  ..............  ..............
                                                         ----------------------------------------------------------------
Northwest........................     Total.............              14              12              10               0              33              31
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   CO...................              12              11              11               0  ..............  ..............
                                   ND...................               1               1               0               0  ..............  ..............
                                   NE...................               0               0               0               0  ..............  ..............
                                   NM...................               2               2               2               0  ..............  ..............
                                   SD...................               0               0               0               0  ..............  ..............
                                   UT...................               4               3               2               0  ..............  ..............
                                   WY...................               0               0               0               0  ..............  ..............
                                                         ----------------------------------------------------------------
Rocky Mountain...................     Total.............              19              17              15               0              26              49
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   AL...................               0               0               0               0              31              44
                                   FL...................               2               2               2               0  ..............  ..............
                                   GA...................               4               4               3               0  ..............  ..............
                                   KY...................               0               0               0               0  ..............  ..............
                                   MS...................               0               1               0               0  ..............  ..............
                                   NC...................              13              11              10               0  ..............  ..............
                                   SC...................               0               0               0               0  ..............  ..............
                                   TN...................               0               0               0               0  ..............  ..............
                                                         ----------------------------------------------------------------
Southeastern.....................     Total.............              19              18              15               0              31              44
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   LA...................               2               1               1               0  ..............  ..............
                                   OK...................              12              11               9               1  ..............  ..............
                                   TX...................               9               8               7               0  ..............  ..............
                                                         ----------------------------------------------------------------
Southwest........................     Total.............              23              20              17               1  ..............  ..............
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                   AZ...................               1               1               0               0  ..............  ..............
                                   CA...................              15              11               9               0  ..............  ..............
                                   HI...................               0               0               0               0  ..............  ..............
                                   NV...................               0               0               0               0  ..............  ..............
                                                         ----------------------------------------------------------------
Western..........................     Total.............              16              12               9               0              44              37
--------------------------------------------------------------------------------------------------------------------------------------------------------
\4\ One of the petitions certified from FY 2009 was received by EDA in FY 2008.


[[Page 2497]]

     (5) The number of petitions filed and firms certified for each 
congressional district of the United States.
    EDA did not collect the number of petitions filed and certified by 
congressional district in FY 2009. EDA has revised Form ED-840P and is 
currently undergoing the required Paperwork Reduction Act (PRA) 
analysis. EDA has incorporated this measure into the revised Form ED-
840P, which is currently being submitted to the Office of Management 
and Budget (OMB) for PRA clearance. In the interim, TAACs have been 
instructed to identify applicants' congressional districts in 
supporting documentation submitted with the petition.
    (6) The number of firms that received assistance in preparing their 
petitions.
    Although EDA has not previously recorded whether a petitioning firm 
received assistance in preparing their petition, EDA understood that 
all firms who submitted petitions through TAACs received assistance 
from the respective TAAC. EDA has revised Form ED-840P to more 
accurately record whether firms receive assistance and from whom. 
Exhibit 6 shows the number of petitions submitted by each TAAC.
[GRAPHIC] [TIFF OMITTED] TN15JA10.021

    (7) Sales, employment, and productivity at each firm participating 
in the program at the time of certification.
    For those firms certified in FY 2009, average employment was by six 
percent below that for firms certified in FY 2008. Average net sales 
were 18 percent below, and average productivity was 14 percent below. 
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 was chosen as the productivity measure. This measure is used 
because it is simple and can be generally applied to all certified 
firms.

Exhibit 7--Summary Comparison of Average Employment, Net Sales, and Productivity for Firms Certified in FYs 2009
                                                    and 2008
----------------------------------------------------------------------------------------------------------------
                                                                                                     Average
                                                                   Average       Average annual  productivity at
                              FY                                employment at     net sales at    certification
                                                                certification    certification    (net sales per
                                                                                                    employee)
----------------------------------------------------------------------------------------------------------------
2009.........................................................               77      $10,715,785         $128,729
2008.........................................................               82      $13,081,993         $149,565
% Change.....................................................             (6%)            (18%)            (14%)
----------------------------------------------------------------------------------------------------------------


  Exhibit 8--Average Employment, Net Sales, and Productivity for Firms Certified in FY 2009 Classified by State
                                                    and TAAC
----------------------------------------------------------------------------------------------------------------
                                                                                                     Average
                                                               Monthly average   Averag annual     productivity
              TAAC                           State                employment       net sales      (net sales per
                                                                                                    employee)
----------------------------------------------------------------------------------------------------------------
                                  IN.........................               60       $6,563,817          $90,814
                                  MI.........................               88       13,511,133          169,359
                                  OH.........................              121       21,163,407          163,563
                                                              --------------------------------------------------
Great Lakes.....................     Average.................               86       13,039,777          143,050
----------------------------------------------------------------------------------------------------------------
                                  AR.........................               23        2,462,000          106,279

[[Page 2498]]

 
                                  KS.........................              114        7,847,500           69,224
                                  MO.........................              159        5,786,387           94,504
                                                              --------------------------------------------------
Mid-America.....................     Average.................              129        5,575,841           92,253
----------------------------------------------------------------------------------------------------------------
                                  DC.........................                0                0                0
                                  DE.........................                0                0                0
                                  MD.........................                0                0                0
                                  NJ.........................               53        6,195,713          115,674
                                  PA.........................               77        9,535,754          125,789
                                  VA.........................                0                0                0
                                  WV.........................                0                0                0
                                                              --------------------------------------------------
Mid-Atlantic....................     Average.................               74        9,164,638          124,665
----------------------------------------------------------------------------------------------------------------
                                  IA.........................               29        1,365,689           47,093
                                  IL.........................               66       11,027,769          153,625
                                  MN.........................               85        9,328,702          121,189
                                  WI.........................              249       33,110,952          158,130
                                                              --------------------------------------------------
Midwest.........................     Average.................               99       14,156,731          146,011
----------------------------------------------------------------------------------------------------------------
                                  CT.........................               54        8,008,737          116,324
                                  MA.........................               39        6,070,712          146,199
                                  ME.........................                8          405,912           49,501
                                  NH.........................               47        5,468,664          121,973
                                  RI.........................               79        6,903,936          164,784
                                  VT.........................                0                0                0
                                                              --------------------------------------------------
New England.....................     Average.................               48        6,368,535          138,096
----------------------------------------------------------------------------------------------------------------
New York State..................     Average.................               73        9,339,480          108,707
----------------------------------------------------------------------------------------------------------------
                                  AK.........................                0                0                0
                                  ID.........................                0                0                0
                                  MT.........................                0                0                0
                                  OR.........................              189        3,229,683           61,458
                                  WA.........................               11        1,500,700          103,599
                                                              --------------------------------------------------
Northwestern....................     Average.................              100        2,365,191           82,529
----------------------------------------------------------------------------------------------------------------
                                  CO.........................               97       34,035,214          140,439
                                  ND.........................                0                0                0
                                  NE.........................                0                0                0
                                  NM.........................               74        4,408,313           64,871
                                  SD.........................                0                0                0
                                  UT.........................               80       11,181,050          150,881
                                  WY.........................                0                0                0
                                                              --------------------------------------------------
Rocky Mountain..................     Average.................               92       27,037,738          131,755
----------------------------------------------------------------------------------------------------------------
                                  AL.........................                0                0                0
                                  FL.........................               78        7,084,047          138,109
                                  GA.........................               34        3,183,356          107,743
                                  KY.........................                0                0                0
                                  MS.........................                0                0                0
                                  NC.........................              111       24,225,837          155,842
                                  SC.........................                0                0                0
                                  TN.........................                0                0                0
                                                              --------------------------------------------------
Southeastern....................     Average.................               91       17,731,769          143,858
----------------------------------------------------------------------------------------------------------------
                                  LA.........................               45        3,121,252           69,361
                                  OK.........................               51        3,689,045           67,355
                                  TX.........................               46        5,504,869          110,700
                                     Average.................               48        4,403,338           85,321
                                                              --------------------------------------------------
Southwest.......................  AZ.........................                0                0                0
----------------------------------------------------------------------------------------------------------------

[[Page 2499]]

 
                                  CA.........................               51        7,904,808          143,021
                                  HI.........................                0                0                0
                                  NV.........................                0                0                0
                                                              --------------------------------------------------
Western.........................     Average.................               51        7,921,301          143,139
----------------------------------------------------------------------------------------------------------------


  Exhibit 9 \5\--Average Monthly Employment, Annual Net Sales, and Productivity at Each Firm Certified for the
                                             TAAF Program in FY 2009
----------------------------------------------------------------------------------------------------------------
                                                             Average monthly
                        Project No.                            employment     Annual net sales    Productivity
----------------------------------------------------------------------------------------------------------------
-2141167170...............................................                11        $1,196,902          $108,809
-2121444292...............................................                67         4,006,469            59,798
-2042247253...............................................               122        15,791,636           129,355
-2013118865...............................................               115         3,298,000            28,741
-1988436588...............................................                42         4,101,937            97,665
-1950117994...............................................                19         1,983,347           104,387
-1928548648...............................................                29         3,379,076           116,520
-1902999773...............................................                84        10,028,851           119,391
-1735872532...............................................                86         8,007,271            93,108
-1706525908...............................................                24         3,247,216           138,179
-1643182588...............................................               335        53,848,974           160,743
-1634468345...............................................                 5           442,494            88,499
-1546967690...............................................                93        14,127,000           151,773
-1506878533...............................................               203        38,116,000           187,764
-1414666091...............................................                48         8,416,445           175,343
-1399657793...............................................                21         3,327,060           158,431
-1370436615...............................................                52         6,348,965           122,095
-1204293136...............................................               113         1,312,194            11,633
-1178629643...............................................                51         3,523,858            68,691
-1144864381...............................................               113        21,591,273           191,073
-1119666282...............................................                27         2,393,550            89,312
-1097381894...............................................                 4           366,266            91,567
-1028400370...............................................                 4           712,071           178,018
-976697335................................................                45         3,575,314            79,451
-976135562................................................                15         1,693,508           109,968
-889718167................................................                53        10,400,385           195,606
-887612628................................................                 2            23,036            14,133
-879675653................................................               158        16,095,224           101,656
-854603118................................................                23           665,537            29,579
-764521341................................................                27         4,282,608           161,608
-739225309................................................                78         6,027,470            77,774
-721946507................................................                 8           405,912            49,501
-707088102................................................                23         5,357,515           233,748
-701972844................................................                95        12,076,738           127,567
-641759960................................................                24         3,274,000           136,417
-632530935................................................                10           112,451            11,245
-631287923................................................                35         1,924,226            54,978
-627002970................................................                21         2,442,947           119,168
-616871455................................................                15         3,975,576           265,038
-594868995................................................                85         8,341,277            98,133
-592625918................................................                58         6,641,978           114,517
-554756768................................................                93        32,349,000           347,540
-534793263................................................                17         2,346,672           136,434
-510304974................................................               218        23,152,444           106,409
-502336347................................................                75        14,316,003           190,880
-477438887................................................                31         4,527,483           146,048
-476833060................................................               178        15,320,292            86,069
-441231945................................................               174        16,688,000            95,770
-428234294................................................                69         9,989,294           145,405
-404256669................................................                80         7,044,108            87,777
-363836427................................................                37         2,853,566            77,543
-360147020................................................                61           807,976            13,246
-283996920................................................                78         9,189,018           118,308
-48958339.................................................               122        43,293,680           354,866
23230469..................................................               284        59,905,827           210,625

[[Page 2500]]

 
65254696..................................................                20         2,463,879           124,753
114629866.................................................                20         2,074,822           104,789
137101191.................................................                15           318,347            21,223
176434616.................................................               101        12,903,834           128,141
246147845.................................................                26         1,935,948            74,460
280418639.................................................                 9         3,207,749           341,250
526891792.................................................                39         3,514,280            90,110
540241037.................................................                87         9,939,297           114,905
587994808.................................................                98        17,905,792           182,712
631689182.................................................                35         2,995,661            85,590
639991136.................................................                17         2,949,494           173,500
674278170.................................................                13           836,017            65,570
675284787.................................................                11         2,494,392           220,743
675586291.................................................               223        19,226,471            86,217
712619105.................................................                 6           405,088            67,515
717100183.................................................                 7           717,780           106,338
726417873.................................................                38         6,404,000           167,425
744959677.................................................               344        42,310,370           122,995
775553880.................................................                17         1,020,236            60,014
819813906.................................................                33         8,930,078           274,772
838593384.................................................                58           950,292            16,384
915263089.................................................                 4           346,908            86,727
945015730.................................................               739           111,833               151
962067466.................................................                24         3,227,083           135,024
989234254.................................................                 6           358,000            61,407
1082975273................................................                22         1,650,000            76,142
1211737402................................................                99        10,494,800           106,115
1218148370................................................                50         4,085,428            81,709
1220532373................................................               174        25,421,539           146,101
1221594278................................................                26         2,622,892           102,457
1221842461................................................                28         3,202,408           113,039
1221849510................................................                19         1,514,723            81,524
1222114933................................................                91           408,844             4,493
1222703402................................................                36         2,153,350            59,272
1222797758................................................                20         1,985,109            99,255
1222976955................................................                33         5,407,901           163,876
1224271418................................................                49         7,677,627           156,686
1224872688................................................               103        13,265,206           128,788
1225120776................................................                28         4,903,000           175,107
1225133741................................................               137        13,773,487           100,720
1225201275................................................               326        50,549,619           155,060
1225287691................................................               292        48,371,484           165,656
1225810350................................................                12           749,609            62,467
1227042607................................................                 3           195,253            65,084
1227289294................................................               113        12,397,000           109,708
1227543460................................................               888           103,961               117
1227630320................................................                53         6,328,130           119,399
1227877017................................................                 8         2,468,000           300,976
1228925679................................................                 1           172,826           216,033
1229617894................................................                58         4,103,785            70,270
1229708794................................................                47         6,561,310           139,602
1230052412................................................                19         2,156,922           115,343
1230750559................................................                28         3,825,907           136,640
1231186429................................................                26         2,951,829           113,532
1231426311................................................                19         2,475,523           130,291
1232040671................................................                51         2,773,358            54,486
1232739420................................................                71        26,183,448           367,745
1232999637................................................                 4           261,470            65,368
1233087150................................................               167         8,650,171            51,797
1233153258................................................                89        25,373,011           285,090
1233239620................................................                11           660,126            57,906
1233327674................................................                60         8,141,100           135,685
1233338572................................................                46         5,741,356           124,812
1233673084................................................                78        13,219,682           169,483
1233691704................................................               147         7,407,619            50,392
1233760561................................................                88        22,565,731           257,306
1233842492................................................                20         2,408,353           120,418
1234275977................................................                69        10,463,729           151,648
1234966745................................................                16         3,997,722           249,858
1234980125................................................                 6           558,835           101,606

[[Page 2501]]

 
1235057791................................................                20         4,409,285           220,464
1235755384................................................               133        49,248,961           370,293
1235770548................................................                97        23,087,874           238,019
1236954447................................................                67         4,297,798            63,984
1237222818................................................               162        34,093,287           210,452
1237298215................................................                61         5,678,660            93,862
1237306159................................................                22         1,874,369            85,199
1237408034................................................                86         8,978,684           104,805
1237488333................................................                79        16,573,810           211,131
1237904074................................................                18         4,579,750           253,305
1237916053................................................               119         9,797,071            82,676
1238084904................................................                14           629,641            45,527
1238173195................................................               115         8,662,992            75,330
1238177474................................................                87        13,279,415           152,637
1238431176................................................                16         1,520,278            93,844
1238505614................................................                29         1,365,689            47,093
1238510711................................................                16         1,147,318            71,707
1238520242................................................                38         3,749,000            98,658
1238765788................................................                21         1,493,937            69,810
1238772555................................................                76        11,606,000           152,110
1239379144................................................                45         3,121,252            69,361
1239897775................................................                10           745,536            74,554
1239916845................................................                17        12,408,106           717,232
1240316759................................................               106        16,656,248           157,134
1240405972................................................                96        12,408,106           129,251
1240492021................................................               153        13,382,187            87,752
1240519189................................................               149        20,677,489           138,682
1242740530................................................                 4           196,390            45,672
1242766013................................................               392        24,305,183            61,956
1242847325................................................                69        14,182,980           205,550
1242997549................................................                89         6,572,979            73,688
1243013350................................................                52        16,549,376           318,257
1243436999................................................               644       328,918,000           511,139
1243524425................................................                 8         1,389,381           173,673
1243613130................................................                 2           232,398           116,199
1243957086................................................                32         3,546,513           112,588
1243968951................................................                23         1,664,125            71,422
1243971069................................................                57         4,043,125            70,808
1244043572................................................                60         4,750,412            79,174
1244055343................................................                99         4,731,197            48,032
1244058559................................................                 4           785,907           188,467
1244127442................................................                71        15,427,668           216,529
1244130026................................................                69         9,072,053           131,670
1244133405................................................                79         8,686,480           110,095
1244141043................................................                17           982,499            57,794
1245437191................................................                18         1,736,066            96,448
1246279087................................................               126        18,495,699           146,443
1246304644................................................               474       147,130,573           310,402
1246459021................................................                11           747,668            67,970
1246886248................................................                21         3,131,095           151,261
1246977066................................................                43         5,447,176           126,679
1246981790................................................                38         5,652,842           148,759
1246994607................................................               241        11,004,128            45,660
1247145245................................................                 8           442,710            55,339
1247147517................................................                 4         1,041,903           260,476
1247150638................................................                10         1,684,610           163,079
1247161869................................................                 9           204,767            21,947
1247238696................................................                13         1,965,636           151,203
1247754433................................................                97        18,745,787           194,257
1247831618................................................                50         8,934,942           178,699
1247835180................................................                29         2,441,616            83,332
1247836448................................................                72        10,851,151           150,710
1248180971................................................                 5           412,418            82,484
1248977837................................................               137        21,887,413           159,762
1249499924................................................                24         3,648,378           152,016
1249569202................................................                12           936,104            78,009
1249916490................................................                22         3,079,082           138,697
1250184197................................................               138        30,238,000           219,116
1250265178................................................               933        99,626,339           106,781
1327553155................................................                10         1,402,910           140,291

[[Page 2502]]

 
1447786180................................................                11           190,335            17,303
1531863717................................................               114        14,611,240           128,169
1583584994................................................                 8           364,976            45,622
1715521604................................................                 9           966,076           108,304
1741163169................................................                66         9,039,000           137,832
1745023300................................................                52         8,970,960           172,518
1874078704................................................                 7           454,718            67,767
1884248409................................................                 8           391,392            48,924
1892823557................................................               107        13,779,974           128,785
1962799420................................................                 9           235,598            27,080
1968260507................................................                32         4,751,162           150,021
1978491171................................................                36         9,163,974           254,555
2019516425................................................                10         1,669,942           169,882
2035965487................................................                10           341,614            34,161
2053807288................................................                66         3,595,710            54,480
2060034620................................................                 2           151,618            69,967
2092576996................................................                35         4,072,919           118,056
----------------------------------------------------------------------------------------------------------------
\5\ As reported by the petitioning firm for the most recent year of the firm's petition period (can be between 6
  and 12 months).

     (8) The number of firms that received assistance developing 
Adjustment Proposals.
    Although EDA has not previously recorded whether a certified firm 
received assistance in preparing their Adjustment Proposals, EDA 
understood that all firms who submitted Adjustment Proposals through 
TAACs received assistance from the respective TAAC. EDA requested that 
TAACs include such information in the Adjustment Proposals. Exhibit 10 
shows the number of plans submitted by each TAAC.
[GRAPHIC] [TIFF OMITTED] TN15JA10.022

    (9) The number of Adjustment Proposals approved and denied by the 
Secretary of Commerce.
    In FY 2009, EDA did not deny any Adjustment Proposals and approved 
172 plans.

                Exhibit 11--Characteristics of the Adjustment Proposals Approved in FYs 2003-2009
----------------------------------------------------------------------------------------------------------------
                                      FY 2003    FY 2004    FY 2005    FY 2006    FY 2007    FY 2008    FY 2009
----------------------------------------------------------------------------------------------------------------
Number of Business Recovery Plans          162        177        132        137        126        139        172
 Approved..........................
Avg. Firm Sales (millions).........       $7.2      $11.6       $8.4      $10.6      $11.2      $15.0      $16.4
Avg. Firm Employees................         68         88         64         91         68         81         80
----------------------------------------------------------------------------------------------------------------


[[Page 2503]]

[GRAPHIC] [TIFF OMITTED] TN15JA10.023

    (10) The financial assistance received by each firm participating 
in the program.
    (11) The financial contribution made by each firm participating in 
the program. Although the TAACs maintain records on actual government 
and firm expenditures for implementation of Adjustment Proposals, EDA 
currently does not collect or record this information in a central 
database. In FY 2010, EDA will include this measure in the revised 
quarterly reports submitted by the TAACs to EDA. Exhibit 13 shows the 
average government and firm cost share proposed by each firm at the 
time their Adjustment Proposals were approved.

                     Exhibit 13--Projected Costs To Implement Approved Adjustment Proposals
----------------------------------------------------------------------------------------------------------------
                                      FY 2003    FY 2004    FY 2005    FY 2006    FY 2007    FY 2008    FY 2009
----------------------------------------------------------------------------------------------------------------
Total Government Share (millions)..       $8.1       $8.5       $5.9       $6.7       $7.1       $7.9      $10.3
Total Firm Share (millions)........        7.4        8.1        5.4        6.0        5.9        7.5        9.8
Total Projected Costs (millions)...       15.5       16.6       11.3       12.7       13.0       15.4       20.2
Avg. Government Assistance Per Firm     50,000     48,023     44,697     48,905     56,449     56,827     60,123
 \6\...............................
----------------------------------------------------------------------------------------------------------------
\6\ Government share of project implementation costs as proposed in the Adjustment Proposals divided by the
  number of approved plans.

    (12) The types of technical assistance included in the Adjustment 
Proposals of firms participating in the program.
    Firms proposed various types of projects in Adjustment Proposals. 
More than half of all firms proposed to implement marketing/sales or 
production/engineering projects. Marketing and sales projects are 
geared toward increasing revenue, whereas production and engineering 
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. Sample projects are listed below in Exhibit 15.

                 Exhibit 14--The Frequency of Specific Projects Proposed in Adjustment Proposals
                                               [Presented by TAAC]
----------------------------------------------------------------------------------------------------------------
                                                   Number of firms that included the following projects in their
                                                                      business recovery plans
                      TAAC                       ---------------------------------------------------------------
                                                    Marketing/        Support       Management/     Production/
                                                       sales          systems        financial      engineering
----------------------------------------------------------------------------------------------------------------
Great Lakes.....................................              15              15              11              15
MidAmerica......................................               7               6               4               5
Mid-Atlantic....................................              15               5               5               9
Midwest.........................................              26              16               0              23
New England.....................................              33              20              27              31
Northwest.......................................               7               1               1               5
New York State..................................              10               6               2               9
Rocky Mountain..................................              16               6               4              14
Southeastern....................................              13               7               6               7
Southwest.......................................              13              10               1              11

[[Page 2504]]

 
Western.........................................               5               3               0               4
                                                 ---------------------------------------------------------------
    Total.......................................             160              95              61             133
----------------------------------------------------------------------------------------------------------------


                                          Exhibit 15--Sample Adjustment Proposals Projects Proposed in FY 2009
--------------------------------------------------------------------------------------------------------------------------------------------------------
           Marketing/sales                       Support systems                    Management/financial                  Production/engineering
--------------------------------------------------------------------------------------------------------------------------------------------------------
 sales planning/development    MRP/ERP selection and         succession planning,          Quality assurance/efficiency
 strategic market planning/    installation                          strategic business plan, financial    sys- tems
 marketing strategy                    IT systems upgrades           planning, investment planning,        production evaluation,
 sales and marketing staff     Software training             supply chain management strategy,     integration, analysis, and efficiency
 training/coaching/mentoring           strategic information         pricing strategy                      5S, lean manufacturing,
 market, technology,           technology plan                       JV and management project     Siemens, MRP, phase-gate system
 merchandising, consumer research      MIS/IT evaluation and         cost accounting/pricing       Industry certifications
 and analysis/export feasibility       recommendation                        system/cost studies/quoting/cost      Employee training
 study                                 Design software               estimating                            supply chain management
 business development/market   MIS reporting systems and     cost tracking/control         program/improvements
 expansion/customer diversification    server                                improvement                           bar coding
 brand recognition/            CRM and PM software           financial restructuring       PLCM improvement
 rebranding
 new product design and        product identification        human resources training,     Green manufacturing and
 development, production line          software                              employee training                     certification
 evaluation                            CAD software upgrade          management-leadership         site evaluation
 web site update/unitronix/    Vantage shop floor            development, managerial capacity      Job Boss Shop scheduling
 Design Online Web site improvements   management system                     building, management training and     system implementation
 kiosk ordering system/e-      Tele-conferencing             coaching                              Value stream map for the
 commerce                              capabilities                          interim leadership            manufacturing process
 trade show design/model kit   implement QuickBooks MIS      company fair market           patent requirements
 package/travel exhibit design         modules and financial reports         valuation                             materials test program
 visual imaging for            customer communication        government procurement        enhance testing and
 marketing/advertising tools           software upgrade                      assistance                            analytical capabilities
 Industry certification        CRM system                                                          program
 promotion campaign                    production and inventory                                            facility expansion and design
 sales pricing and sales       control modules/software                                                    prototype research, design,
 channel                               MIS system integration                                              and testing
 lead generation               quality controls                                                            develop capabilities for new
 after-market service plan                                                                                 production line/business
 install new computer                                                                                      production tooling design
 network                                                                                                           vendor stocking program
 automate kin controllers                                                                                  FSC chain of custody plan
                                                                                                                   calibrate equipment,
                                                                                                                   equipment installation and start-up,
                                                                                                                   facility/equipment design
                                      ....................................  ....................................   warehouse automation
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (13) The number of firms leaving the program before completing the 
project or projects in their Adjustment Proposals and the reason the 
project was not completed.
    EDA currently does not collect or record this information. In FY 
2010, EDA will include this measure in the revised quarterly TAAC 
report.
    (14) Sales, employment, and productivity at each firm upon 
completion of the program and each year for the two-year period 
following completion.
    Most, if not all, TAACs record the sales, employment and 
productivity of firms after completing the TAAF Program. However, EDA 
currently does not collect or record this information for the 2-year 
period following completion. In FY 2010, EDA will include this measure 
in the revised quarterly TAAC report.

Discussion and Analysis

FY 2009 Performance

    In FY 2009 as compared to FY 2008, the number of petitions 
submitted to EDA increased by 49 percent. Due to current economic 
conditions and the expansion of eligibility to service sector firms, 
increases in the number of petitions are expected to continue in FY 
2010. As the TAACs continue to strengthen their marketing channels to 
more effectively reach service firms, it is expected that the number of 
petitions will increase. If petitions continue to increase at the same 
rate, EDA can expect approximately 400 petitions in FY 2010.

[[Page 2505]]

[GRAPHIC] [TIFF OMITTED] TN15JA10.024

[GRAPHIC] [TIFF OMITTED] TN15JA10.025

    The average total processing time of petitions increased by 
approximately 17 days, a 30 percent overall increase. A spike in the 
number of petitions submitted and a recent decline in the number of 
eligibility reviewers have made it challenging for EDA to meet the 40-
day review deadline to provide a final determination on petitions. As 
of May 17, 2009, EDA is required to make a final determination within 
40 calendar days of a petition being accepted for filing under Section 
251 of the Trade Act. Before May 17, 2009 EDA had to make a 
determination within 60 calendar days. The average processing time has 
improved as of the fourth quarter of FY 2009. The addition of two new 
EDA Program Analysts (expected start dates between December 2009 and 
February 2010) and a new TAAF Program Director (start date August 30, 
2009) is expected to improve EDA's processing time for petitions for 
the remainder of FY 2010. For the average petition, Exhibit 18 shows 
that, EDA missed the 40 day deadline in the third quarter of FY 2009, 
but was able to meet the deadline in the fourth quarter of FY 2009.

[[Page 2506]]

[GRAPHIC] [TIFF OMITTED] TN15JA10.026

    EDA must approve all petitions for certification and Adjustment 
Proposals for firms to receive financial assistance. Although EDA has 
not previously recorded whether a petitioning or certified firm 
received assistance in preparing their petition or Adjustment 
Proposals, EDA understood that all firms who submitted petitions and 
Adjustment Proposals through TAACs received assistance from the 
respective TAAC. EDA has revised Form ED-840P to more accurately record 
whether and from whom firms receive assistance. Also, EDA requested 
that TAACs include such information in the Adjustment Proposals.
    EDA has assumed that eligible firms either do not have the capacity 
to submit petitions and Adjustment Proposals without assistance, or 
that doing so would cause unnecessary burden to small and medium-sized 
firms. EDA therefore understands that all firms receive assistance.
    As compared to FY 2008, average net sales of certified firms 
declined by 20 percent and average employment declined by six percent. 
The National Bureau of Economic Research (NBER) determined that a 
recession began in December 2007. It is likely that the recession has 
contributed to the decline in sales and employment of certified firms 
in FY 2009. Firm productivity, defined as net sales per employee, in 
certified firms has declined as well.
    The TAAF program strongly targets small and medium-sized businesses 
in the provision of assistance. In order to classify small and medium-
sized firms EDA used the Small Business Administration's (SBA's) size 
standards. Medium-sized firms are classified as those with less than 
500 employees for most manufacturing and mining industries, or less 
than $7 million in average annual receipts for most nonmanufacturing 
industries. Ninety eight percent of the firms certified in FY 2009 had 
fewer than 500 employees, and 58 percent had less than $7 million in 
annual net sales. This indicates that the TAAF program is mostly 
reaching small and medium-sized businesses.

[[Page 2507]]

[GRAPHIC] [TIFF OMITTED] TN15JA10.027

[GRAPHIC] [TIFF OMITTED] TN15JA10.028

    EDA experienced a 15 percent increase in the number of Adjustment 
Proposals it received for approval in FY 2009. In comparison, there was 
a 49 percent increase in the number of petitions in the same year. It 
is expected that the number of Adjustment Proposals submitted will be 
fewer than the number of petitions, since Adjustment Proposals often 
take more time to create and require firms to contribute funds for 
their development and implementation. Firms with limited working 
capital and limited access to credit will tend to develop and implement 
the Adjustment Proposals more gradually.

[[Page 2508]]

[GRAPHIC] [TIFF OMITTED] TN15JA10.029

    The number of approved Adjustment Proposals and the proposed 
financial assistance to be received from EDA and contributed by each 
firm increased in FY 2009. EDA approved an additional 28 Adjustment 
Proposals as compared to FY 2008 and proposed to spend an additional 
total of $2.4 million in government funds. The TAAF Program received an 
increase of approximately $1.7 million in Omnibus appropriations for FY 
2009.
    Approximately 65 percent of firms included marketing/sales projects 
or production/engineering projects in their Adjustment Proposals. 
Approximately 35 percent of firms included support system projects or 
management/financial projects in their Adjustment Proposals. This mix 
of project types proposed in the Adjustment Proposals indicates that 
firms are focusing on both revenue growth and cost reduction in order 
to improve their profit margin.
[GRAPHIC] [TIFF OMITTED] TN15JA10.030


[[Page 2509]]



Looking Forward: Data Collection

    The TGAAA identifies 14 measures to be included in each year's TAAF 
Annual Report. Of the 14 measures, EDA currently does not collect data 
on four. These measures are: (1) The number of firms that inquired 
about the program, (2) the number of petitions certified by 
congressional district, (3) the number of firms leaving the program and 
why, and (4) sales, employment, and productivity at each firm upon 
completion of the program and every year for the two years thereafter. 
There are another four measures that EDA does not collect data on 
directly, but has access to relevant information: These measures are: 
(1) The number of firms that received assistance in preparing their 
petition, (2) the number of firms that received assistance in preparing 
their Adjustment Proposal, (3) the actual government outlays for each 
firm implementing their Adjustment Proposal, and (4) the actual firm 
outlays for implementing the Adjustment Proposal. Most of these 
measures are recorded by the TAACs, but EDA has not required TAACs to 
report on them to EDA.

                       Exhibit 23--FY 2010 Data Collection Plan for the 14 Measurements Required for the Annual Report to Congress
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                                                                                                                              Procedure/policy changes
             Measurement                       Collected by EDA?                        Recordkeeping system                          required
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1. Number of Firm Inquiries.........  No................................  New Management Information system (MIS).........  TAACs should have a written
                                                                                                                             record of their response to
                                                                                                                             firm inquiries and submit a
                                                                                                                             copy of this notice along
                                                                                                                             with the firm's DUNS number
                                                                                                                             to EDA in the TAAC's
                                                                                                                             quarterly report. A new
                                                                                                                             information system will
                                                                                                                             need to be designed to
                                                                                                                             record the information
                                                                                                                             collected from the TAAC
                                                                                                                             quarterly reports.
2. Number of Petitions..............  Yes...............................  MIS.............................................  None.
3. Number of Petitions Certified and  Yes...............................  MIS.............................................  None.
 Denied.
4. Average Petition Processing Time.  Yes...............................  Derived from MIS................................  None.
5. Number of Petitions and            No................................  MIS.............................................  Form ED-840P will be revised
 Certifications by Congressional                                                                                             so that a firm's
 District.                                                                                                                   congressional district will
                                                                                                                             be recorded. The MIS has
                                                                                                                             been modified to include
                                                                                                                             this information.
6. Number of Firms that Received      To some extent....................  MIS.............................................  Currently, EDA receives all
 Assistance in Preparing their                                                                                               petitions directly from the
 Petitions.                                                                                                                  TAACs. Form ED-840P will be
                                                                                                                             revised so that firms can
                                                                                                                             indicate whether they
                                                                                                                             received assistance. The
                                                                                                                             MIS will be modified to
                                                                                                                             include this information.
7. Number of Firms that Received      To some extent....................  MIS.............................................  Currently, EDA receives all
 Assistance in Developing Their                                                                                              Adjustment Proposals
 Adjustment Proposal.                                                                                                        directly from the TAACs.
                                                                                                                             TAACs have been advised to
                                                                                                                             indicate the type of
                                                                                                                             assistance received by the
                                                                                                                             firms in the adjustment
                                                                                                                             proposals submitted to EDA.
                                                                                                                             The MIS will be modified to
                                                                                                                             include this information.
8. Number of Adjustment Proposals     Yes...............................  MIS.............................................  None
 Approved and Denied.
9. Sales, Employment, and             Yes...............................  MIS.............................................  For the large number of
 Productivity at Time of                                                                                                     firms in varying industries
 Certification.                                                                                                              being measured, few employ
                                                                                                                             or track the same
                                                                                                                             productivity measures. EDA
                                                                                                                             chose to use the simplest
                                                                                                                             and most universal metric
                                                                                                                             for productivity: sales per
                                                                                                                             employee.
10. Sales, Employment, and            No................................  New MIS.........................................  EDA will request this
 productivity at Each Firm Upon                                                                                              information from TAACs in
 Completion of the Program and Each                                                                                          their quarterly reports.
 Year for the Two-Year Period                                                                                                Also, EDA may continue to
 Thereafter.                                                                                                                 track firms through the Dun
                                                                                                                             and Bradstreet database to
                                                                                                                             collect sales and
                                                                                                                             employment figures.
11. Financial Assistance Received by  To some extent....................  New MIS.........................................  EDA records the proposed
 Each Firm Participating in the                                                                                              government expenditures on
 Program.                                                                                                                    each project, but does not
                                                                                                                             request information on
                                                                                                                             actual outlays for each
                                                                                                                             firm. EDA will request this
                                                                                                                             information from TAACs in
                                                                                                                             their quarterly reports.
12. Financial Contribution Made by    To some extent....................  New MIS.........................................  EDA records firms' proposed
 Each Firm Participating in the                                                                                              expenditures on each
 Program.                                                                                                                    project, but does not
                                                                                                                             request information on
                                                                                                                             actual outlays for each
                                                                                                                             firm. EDA will request this
                                                                                                                             information from TAACs in
                                                                                                                             their quarterly reports.
13. Types of Technical Assistance     Yes...............................  MIS.............................................  This information is now
 Included in the Adjustment                                                                                                  recorded by EDA. Previously
 Proposals of Firms.                                                                                                         this information was
                                                                                                                             submitted to EDA, but not
                                                                                                                             recorded in any MIS.
14. Number of Firms Leaving the       No................................  New MIS.........................................  TAACs will be advised to
 Program Before Completing the                                                                                               include this measure in
 Project(s) in their AP and the                                                                                              their quarterly activity
 Reason.                                                                                                                     reports.
Classification of Data by TAAC,       Yes...............................  MIS.............................................  None.
 State, and National Totals.
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    EDA is considering several steps to address the collection of the 
remaining measures.
    Following is a list of the steps EDA will take to address the 
current data collection gaps.
    (1) TAACs were instructed to upgrade their Adobe software to 
facilitate data collection. TAACs that only have Adobe Reader can use 
the Adobe fillable forms, but they cannot save the information on their 
computers. Upgrading the Adobe software will allow the remaining TAACs 
to save electronic records of the forms, and will allow EDA to 
automatically upload information into its management information system 
and no longer require EDA to re-type all of the information into the 
system.
    (2) EDA will issue several new procedures and guidelines to 
simplify data collection through a revised template for the quarterly 
TAAC activity reports.
    (3) As resources become available, the management information 
system (MIS) will be expanded to facilitate reporting.
    (4) EDA is in the process of seeking OMB clearance for a revised 
Form ED-840P to collect all required data.

Conclusion

    Overall, there has been an increase in the demand for the TAAF 
Program in FY 2009, as demonstrated by the increase in the number of 
petitions for certification and Adjustment Proposals submitted to EDA.
    Due to the spike in petitions and Adjustment Proposals, EDA 
experienced challenges in meeting the new 40-day processing deadline 
for petitions accepted for filing immediately after the new rule's 
implementation. However, since the fourth quarter of FY 2009, the 
average processing time for petitions declined below the 40-day 
requirement. New TAAF program staff members are expected to help 
improve processing time even further for FY 2010.
    TAACs effectively targeted small and medium-sized firms in FY 2009. 
The average employment, net sales, and productivity of firms certified 
in FY 2009 declined in comparison to the previous fiscal year. More 
than half of all firms proposed to implement a marketing/sales project 
or production/engineering project in their Adjustment Proposals.
    Of the 14 measures required for reporting, EDA was unable to 
provide any information on four measures, and provided limited 
information on another four measures. EDA is taking steps to collect 
and report on all of the missing measures for the FY 2010 Annual 
Report.

    Dated: January 7, 2010.
Bryan Borlik,
Director, Trade Adjustment Assistance for Firms Program.
[FR Doc. 2010-561 Filed 1-14-10; 8:45 am]
BILLING CODE 3510-24-P