July 15, 2025
By Jennifer Williams
As the tariff topic has been extensively discussed for months, we would be remiss to ignore an important factor in the tariff war – Foreign Trade Zones (FTZs).
Created by Congress for economic development, these zones exist “outside the customs territory of the United States.”
According to advertising literature for Logistics Park KC (LPKC) in Edgerton, Kansas, benefits include:
- Accelerated Supply Chain
- Reduced merchandise processing fees
- Duty savings
- Decreased inventory tax
If this is true, does this also include duty savings on Trump’s tariffs?
If so, will we see a spike in the use of FTZs in order to eliminate or reduce the tariffs?
The obvious answer would be, yes.
Companies will use whatever means necessary to delay tariffs by using Foreign Trade Zones. They could even eliminate tariffs entirely if imported products are then exported directly from the FTZ instead of being released into the U.S. market.
This brings me to my biggest concern:
National Security Threats and Foreign Trade Zones
Over a year ago, while we were working in Kansas to persuade legislators to ban land ownership of foreign adversaries, I put together a presentation on Foreign Trade Zones.
In it, I showed how the local economic development machine (Grantee) was not doing their due diligence in background checks, by allowing companies like the CCP-connected CNANO to own land at the former Olathe Naval Air Station and current New Century Air Center.
I was given the opportunity to share it with Kansas Attorney General, Kris Kobach, showing my very legitimate safety concerns with Foreign Trade Zones (FTZs) – the biggest being the lack of oversight and no inspections of inventory coming into the FTZs.
I also pointed out the conflict of interest of the program Grantees (those fast-tracking the foreign companies’ approvals for FTZ status) because those involved in approving the companies for the zones (and reviewing the companies’ self-generated annual inventory reports) were also the ones who directly or indirectly are profiting from the construction contracts and economic development deals.
In the presentation I stated:
Not only are these FTZ’s governed by local economic development investors with public-private partnerships with local developers and businesses benefitting from the growth, it is ultimately under the umbrella of Border Patrol and Customs, a Federal organization that has failed citizens miserably and subjected them to repeated attacks and foreign invasions.
While we are watching the invasion at the Southern border, our heartland has a gaping hole with little to no oversight.
It is time for Kansas to play offense, instead of defense.
This is a National Security threat!
Although AG Kobach was shocked to learn some of the facts I presented, his answer was extremely disappointing and shows just how much “States Rights” have taken a beating in the name of National Commerce Clauses and Federally-mandated power plays.
Kobach said he could do nothing about it because Federal Commerce Clauses prevent States from having any authority or control over Foreign Trade Zones. (Solidifying the concerns with federally-mandated ai taking away the States’ power, because we see a perfect example here how our hands are tied at the State level with the inability to pass laws needed to protect our interests and security due to the commerce clause. We don’t need to get in the same situation with ai.)
I suggested, at a minimum, that we push for Kansas to have control over naming the FTZ Grantee, so we could be certain that it was an independent party with no profit motives and that inventory inspections were happening and inventory reports were accurate, so that no one was turning a blind eye to national security. However, nothing has been addressed since.
For the remainder of this article, I’m mostly going to show you screenshots from my presentation that included screenshots from the KC area Foreign Trade Zone website – ThinkKC and the Kansas City Area Development Council.
I want the reader to see the potential conflicts, straight from the source documents, without wondering if any of my concerns are fabricated or unsubstantiated.
In my belief, Foreign Trade Zones are a national security risk and should be revisited by Congress in order to put common sense safe guards and inspections in place to protect citizens from the potential of inappropriate and dangerous items being routed through the zones without oversight.
We need protection from our foreign adversaries, not a fast-tracked backdoor loophole for the potential importing of guns, drugs, weapons of mass destruction, trafficked humans, or even foreign soldiers invading our homeland.
FTZs receive inventory sealed, outside of customs
This was one area AG Kobach was not aware of; yet, the KC SmartPort and ThinkKC openly brag about in their promotional literature:
“Swift customs clearance at the Port of Entry for shipping directly to the FTZ. Remove seals and enter into inventory without Customs supervision.”
To me, that is akin to advertising to overloaded trucks that the weigh station is closed on a busy highway, so no fear of getting caught running heavy on weight – because no one is there to catch you.
Only this time, we are talking about inventory coming fast-tracked outside of customs, and border protection is not going to catch you importing something dangerous or illegal. One example damages roads, the other could destroy lives.
How is this possible?
The current FTZ manual dated 2011 states, “For many years, CBP (customs and border protection) protected the revenue in zones through physical supervision of all merchandise receipts and deliveries to and from the zone, and of all zone processing operations. Zones and subzones are now managed by CBP under an audit-inspection method which means that CBP does not maintain inventory records and CBP personnel are not routinely physically assigned to the premises (TD 86-16).”
So if Customs and Border Protection are not routinely assigned to the FTZ premises and no inventory records are maintained, who are the foreign companies reporting to? The Grantee.
“The privilege of establishing, operating, and maintaining Foreign-Trade Zone No. 17 has been granted to the Grantee by the FTZ Board . . . All operators of Foreign-Trade Zone No. 17 shall submit to the Grantee information required for the Grantee to prepare and file an Annual Report to the FTZ Board, pursuant to 15 C.F.R 400.51(c).”
Who’s Who in FTZs?
Let’s take a moment to identify the flow chart of players to have a clear understanding of terms:
Who is the Grantee for FTZ 15 & 17 in the Heartland?
The Greater Kansas City Foreign Trade Zone (GKCFTZ)
“The Greater Kansas City Foreign Trade Zone, Inc. (GKCFTZ) is a regional grantee of the national FTZ program. GKCFTZ has been the grantee since 1974 and was the first non-profit organization to be designated a grantee. GKCFTZ sponsors both Foreign-Trade Zone No. 15 in Kansas City, Missouri, and Zone No. 17 in Kansas City, Kansas. Zone 15 serves FTZ needs in 22 contiguous counties in the western half Missouri. Zone 17 presently serves 9 counties in metropolitan Kansas City, Kansas.
GKCFTZ is one of the largest zone operators in the country with over 450 million square feet of approved foreign trade zone space that includes General Purpose and Subzone space in both Kansas and Missouri. The Kansas City trade zones handle more volume than those of Chicago, Dallas, Denver, Minneapolis and St. Louis and have more available space than any other area in the country.”
However, in January 2023, it was announced that KC SmartPort would be operating the Greater Kansas City Foreign Trade Zone (GKCFTZ).
From the above announcement:
“KC SmartPort, the industrial business attraction organization for the Kansas City region, announced it is now operating the Greater Kansas City Foreign Trade Zone (GKCFTZ). The GKCFTZ is the regional grantee for the national Foreign Trade Zone (FTZ) program and will remain an independent nonprofit entity.
As the new operating team for the GKCFTZ, KC SmartPort, an affiliate of the Kansas City Area Development Council, will manage the organization’s grantee duties and responsibilities with Chris Gutierrez now leading both organizations as president.”
It goes on to say, “The GKCFTZ is overseen by an independent, volunteer board of directors, comprised of leadership from top companies and civic organizations throughout the Kansas City region. The 2023 executive committee members include Gino Serra, Bryan Cave Leighton Paisner; Reid Schulz, RS Electric; Ken Hoffman, Dysart Taylor Cotter McMonigle & Brumitt; and Connie Kamps, Hunt Midwest Real Estate Development.”
This is where I believe the conflict of interest between economic development and national security comes to a head.
Can a board of economic developers and business owners motivated by profit and more “jobs and taxes” properly vet businesses in the FTZs for national security concerns?
Do they even care to?
The Grantee’s website brags about quick FTZ approval in “as little as 30 days.”
Is that really enough time to properly vet a foreign company?
In the case of CNANO in Johnson County, Kansas, the answer would be a resounding NO!
In June 2023, as the Johnson County Board of Commissioners tried to fast track approval of CNANO, they originally never even referenced the company’s name in the staff reports, only referring to them as “the company.”
It took the work of a local resident investigating to discover “the company” had ties to the CCP with no prior history in the United States.
Was this a willful oversight of the Grantee and JoCo BOCC, or negligence on the part of a group of “investors” trying to get the controversial and heavily subsidized Panasonic (another KCADC project) off the ground?
We may never know, and what’s done is done because even the 2025 Kansas Legislator’s restrictions on foreign land ownership, grandfathered CNANO in and does not retroactively apply to their land purchase at the airport.
What we do know is that three of the major players involved in approving (and profiting on) the development and the land sale – Johnson County Kansas Government, the Johnson County Airport Commission, and their exclusive developer for the New Century Air Center, VanTrust Real Estate – are on the Board of Directors and “investors” of the Kansas City Area Development Council (KCADC), an affiliate of the FTZ Grantee as shown above.
We also know CNANO was approved for the Foreign Trade Zone by the Grantee, and then needed the local government approval by Johnson County Board of Commissioners and the Johnson County Airport Commission.
With the same players working across organizations, it’s too easy to avoid transparency and force something through “for the team” and the larger regional agenda of the KCADC.
Meanwhile, residents bringing valid security concerns ( including one Chinese- American who had escaped China and the CCP in 1949 and warned the commissioners of the dangers of the CCP) were ignored and even accused by Chairman Mike Kelly of trying to “marginalize our Asian American friends” as he tried to sweep the concerns under the rug in order to push the regional agenda for the stakeholders.
(Concerned citizens have recently been vindicated from Chairman Kelly’s racism accusations with the continual proof of the very real national security threat of allowing CCP- affiliated individuals and companies to own our farmland, homes, and specifically near military bases. Thankfully as of July 10, Senator Josh Hawley introduced The Protecting Our Homes and Farms From China Act, to ban CCP-tied individuals from owning farmland. This is a coordinated effort with the Federal Government, titled the National Farm Security Action Plan. Defense Secretary Pete Hegseth warned of the national security risks of the CCP owning land near military installations. See 23:46 in attached video link)
This further supports that the conflicts of interest of the key players pushing the CNANO project, shown below, were not in the best interest of public safety or welfare.
Who are the major organizations associated with the FTZ Grantee?
Greater Kansas City Foreign Trade Zone (GKCFTZ),
Kansas City Area Development Council (KCADC),
KC Smart Port,
ThinkKC,
OneKC,
KC Global Design,
KC Heartland (KC Strong) –
all branding names and organizations under the same 30 West Pershing Rd. roof and cogs in the wheel of the economic development machine
Foreign Trade Zone 17 is operated as a public utility.
When working with their investor, Port KC, their port authority allows them to issue bonds, reclaim land (eminent domain), and enter into contracts to develop that land.
Employees and Board members work across organizations in the economic development machine
Who is the Kansas City Area Development Council (KCADC) and What is Their Mission?
As shown in the screenshot, their website says:
About KCADC
The Kansas City Area Development Council (KCADC) is a private, non-profit organization. We are charged with representing the economic interests of the entire two-state, 18-county Greater Kansas City region of 2.5 million. KCADC’s clients consistently rank our team among the top regional economic development groups in the nation.
Mission: Engage the world to invest in the OneKC region.
Our role:
- Attract new companies and talent to the 18-county, two-state KC region.
- Enhance awareness of our metro’s assets to create positive perceptions.
- Promote the KC region as a business and lifestyle location of choice.
- Brand the KC region as one product to stimulate economic growth.
- Equally support all of our regional communities and investors.
- Facilitate relocation/expansion process between a company and its selected KC community.
Foundational Principles
Three guiding principles lay the foundation for all that KCADC does:
- Both the states of Kansas and Missouri, and our constituent communities, are always dealt with fairly, open-handedly, and with balance. A regional marketing effort is the only effort that will be successful over time.
- The client’s view of metro Kansas City will be one of a smooth, seamless whole, united behind an effort to successfully locate the client in our community. Competition for these clients among our community partners is brokered through KCADC in order to present the best possible business opportunity for the client. It is also done in a manner that never disparages the alternate state or alternate communities.
- A success anywhere in the metro is a success shared by all.
Find out more about KCADC’s beginnings and our story of regionalism.
As you can see from their website, they are an economic development machine that not only focuses on regional branding, but also becomes the middle man broker for their “community partners” where all deals are supposed to go through them, like the Godfather or a mob boss. (Kansas City does have a rich mob history, and perhaps this is the modern day version of its historical past.)
A local city council member, who spoke to me anonymously on this topic, said that his day job employer has done some work for KCADC, but they are never allowed to get the actual project contracts for the work they design because they are not “investors” – meaning they did not “pay to play.”
Who are the “investors” that do get the contracts and opportunities?
The following are screenshots showing some names of investors and partners.
By no means am I accusing any company of anything nefarious. I am simply showing those associated with the machine, per their own website.
These NGOs, public-private partnerships, and incestuous business relationships can give the appearance of impropriety, further proving the need for a true checks and balances, as our government was founded on – with public transparency, participation, awareness and approval.
When too many of the same names serve on multiple boards across the participating organizations, it sets up the potential for unfair deals, creating a private club instead of a transparent and neutral non-profit organization. It can force an agenda on the public without true “due process” instead of protecting public trust and interest by remaining neutral and impartial.
Why are we not putting true separation of powers and unaffiliated parties in place to keep honest people honest?
How is this even ethical? Or legal?
KC SmartPort’s Chairman is President and CEO of the Midwest’s “Real Estate Powerhouse” and has been involved personally with over 100 million sq. ft of industrial, office, etc development
Joe Caldwell is listed as both an officer of KC SmartPort and an investor. Does his firm get the contracts engineering the approved projects – compromising judgment as a FTZ Operator in vetting potential threats due to his company profiting off the development? That is an unknown conflict concern and not an accusation.
Cary Hutchings is an officer of KC SmartPost and is the Director of Corporate Real Estate for BNSF.
Jim Kuecker is an officer at KC SmartPost and Chief Commercial Officer for KPI Solutions, a warehousing and distribution company potentially benefitting from the developments.
Tim Cowden, President & CEO of the KC Area Development Council and Officer of KC SmartPort
KDOT favors global development projects at expense of local residents’ concerns—see 4-lane Highway for Panasonic through Kansas farms.
Free Market and Economic Dangers
This “pay-to-play” model sets up a regional monopoly that focuses on money and development but not individual freedom, a free market, or national security.
In a free and fair market of capitalism, all businesses would have equal access to all economic opportunities.
In this regionalism public-private partnership approach, fair and free markets are hijacked by cronyism, special deals, and favors that distort the market and removes natural competition.
“When the government favors and chooses, the little guy loses.”
Regionalism removes or dilutes the local voice of individual municipalities, shuts down the public, and forces an agenda that is “best for the region.”
This is not the way a Constitutional Republic should work but is more akin to a top-down Marxist approach, complete with government-favored “investors,” businesses, and “stakeholders.”
That’s exactly what’s happening with this regional machine.
They have branded themselves ThinkKC.
Miami County has jumped on board with ThinkMiamiCounty.
In a Kansas Open Records Act (KORA) request last year to Miami County Kansas Economic Development Director (that cost me over $300,) I learned the Miami County government pays $10,000 per year to be a member of the KCADC to keep “apprised of economic opportunities affecting Miami County including current or potential development projects, upcoming state-related development projects and projected development costs,” per the county administrator.
With this KCADC machine, city and county governments are involved and can rubber stamp deals (again, think CNANO or Panasonic’s special favoritism and approval) despite public resistance at city council, county commission, and state-level meetings.
The state investors at the Kansas Department of Transportation (KDOT) can “pave the way” with connecting roads and funding needed for goods movement.
The Kansas Commerce Department can favor certain deals with grants or special funding.
Banks, engineers, developers, real estate agents, and more are investor-partners, oiling the machine with the ability to line their pockets. “Investor” lawyers go to bat speaking in favor of projects at government meetings or threaten to sue when the people get in the way.
But where is the transparency and accountable to the constituents and the free market?
Governments are not supposed to be in the economic development business! That is the role of private enterprises – free of government favoritism, subsidies, kickbacks, special zoning or tax deals.
All people should have an equal playing field, where the citizens tell the government how they want things to run, not the government forcing backroom deals, despite opposition by the public they are supposed to be representing.
In this screenshot below of a monthly Miami County Economic Development Report, it shows they “Keep KCADC in the loop with key Miami County initiatives, so that both parties can work in a mutually beneficial fashion as resources and partners in helping the region grow and prosper.”
It also states “staff and city representatives interact with KCADC staff regularly.”
This sounds like the earlier-listed requirement of KCADC membership – repeated below:
Facilitate relocation/expansion process between a company and its selected KC community.
The client’s view of metro Kansas City will be one of a smooth, seamless whole, united behind an effort to successfully locate the client in our community. Competition for these clients among our community partners is brokered through KCADC in order to present the best possible business opportunity for the client.
They are working for the client, but who is protecting We The People?
This “regional” partnership goes directly against the feedback of citizen surveys, stating Miami County residents want to be separate of KCMO and maintain a rural, small-town feel.
Miami County’s Economic Development Department’s involvement in the KCADC, MARC, Kansas City Chamber, et all is forcing the regional agenda on Miami County in an alliance not authorized by the people.
As a resident of Miami County, I believe it is none of KCADC’s business what Miami County does, and I take offense to my tax dollars paying staff and membership fees to an out-of-state organization that is getting control and a say in my county’s future development. They don’t deserve a “stakeholder” or brokerage position and should never be a middle man between businesses and government.
Especially when KCADC is so intertwined with other organizations with differing values and goals than the people have expressed they want.
As shown in the wiki page for KC SmartPort:
The original “feasibility study” that founded KC SmartPort was jointly commissioned by the Mid America Regional Council (MARC), The Greater Kansas City Chamber of Commerce, and the Kansas City Area Development Council – all partners, investors, and benefactors of the formation and all organizations that we have reported concerns on (see links above.)
Why is a “non-profit, investor-based organization in charge of economic development and national security with no oversight?
As we see their preferred industries, it starts to make sense why warehouses, data centers, and battery storage have been forcing out homeowners despite public opposition and even lawsuits for inappropriate zoning.
As KC SmartPort and KCADC invest in marketing to show why the Midwest is a prime location for their massive foreign trade zone, I believe – like in the earlier weigh station example- that we are only advertising that gaping hole in our heartland and showing potential foreign adversaries how easy it would be to enter our trade zone with untracked “inventory,” sealed outside of customs, and spread it quickly across the country – reaching 90% of the country in less than 2 days.
Rail, road, air, water, intermodal – the FTZs are a prime location for a foreign invasion and our States need the ability to protect the citizens from these national security concerns.
Sources:
FTZ Information for U.S. Customs and Border Protection
http://www.trade.gov/sites/default/files/2020-08/FTZ_Info_for_CBP.pdf
Foreign Trade Zones Manual by U.S. Customs & Homeland Security
https://www.cbp.gov/sites/default/files/documents/FTZmanual2011.pdf
Port KC Strategic Plan
https://portkc.com/wp-content/uploads/2016/03/StrategicPlan_Vision.pdf
Greater Kansas City Foreign Trade Zone
https://kcsmartport.thinkkc.com/site-selection/kansas-city-foreign-trade-zone
Foreign-Trade Zones Resources
https://www.trade.gov/foreign-trade-zones-board