DEPARTMENT OF LABOR

Employment and Training Administration

TA-W-40,320

ELK RAPIDS ENGINEERING
A DIVISION OF STAR CUTTER COMPANY
ELK RAPIDS, MICHIGAN

Notice of Negative Determination
Regarding Application for Reconsideration

By application dated May 16, 2002, a petitioner requested
administrative reconsideration of the Department's negative
determination regarding eligibility to apply for Trade Adjustment
Assistance (TAA), applicable to workers and former workers of the
subject firm. The denial notice was signed on May 7, 2002, and
published in the Federal Register on May 17, 2002 (67 FR 35140).
Pursuant to 29 CFR 90.18(c) reconsideration may be granted
under the following circumstances:
(1) If it appears on the basis of facts not previously
considered that the determination complained of
was erroneous;
(2) if it appears that the determination complained of
was based on a mistake in the determination of facts
not previously considered; or
(3) if in the opinion of the Certifying Officer, a mis-
interpretation of facts or of the law justified
reconsideration of the decision.


The petition for the workers of Elk Rapids Engineering, Elk
Rapids, Michigan was denied because the "contributed importantly"
group eligibility requirement of Section 222(3) of the Trade Act
of 1974, as amended, was not met. The "contributed importantly"
test is generally demonstrated through a survey of customers of
the workers' firm. The survey revealed that none of the
respondents increased their purchases of imported CNC controlled
machine tools while decreasing their purchases from the subject
firm. The subject firm did not import CNC controlled machine
tools.
The petitioner believes that their company as well as the
entire machine tool industry in the United States has been
significantly affected by increased imports of machine tools.
The petitioner attempts to support this claim by providing a
transcript of testimony given by the Association for
Manufacturing Technology before the Committee on Small Business,
U.S. House of Representatives on April 24, 2002. The petitioner
also indicates that customers are spending less and importing
more machine tools during the relevant period. The petitioner
further attached a summary of U.S. Machine-Tool Orders depicting
significant declines in orders during the last few years.
A review of the data supplied by the petitioner depicts
industry wide data that is not specific to the products produced
at the subject plant. The Department of Labor examines the
direct impact of imports that are "like or directly competitive"
with what the subject plant produced and if imports "contributed
importantly" to the layoffs at the subject plant. The
investigation revealed that imports of the product produced at
the subject plant did not "contribute importantly" to the layoffs
at the subject plant. The U.S. Machine-Tool Order data supplied
by the petitioner depicts declines in U.S. machine-tool orders
during the last few years. U.S. machine tool orders include
those for the export market, as well as the domestic market.
Thus a reduced demand for U.S. machine tools (depicted by orders)
does not reflect a definitive increase in imports. Examination
of industry data in which the subject firm's products are
categorized shows that U.S. imports of products like or directly
competitive with what the subject firm produced declined in 2001
over 2000.
Conclusion
After review of the application and investigative findings,
I conclude that there has been no error or misinterpretation of
the law or of the facts which would justify reconsideration of
the Department of Labor's prior decision. Accordingly, the
application is denied.
Signed at Washington, D.C. this 20th day of June 2002.

/s/ Edward A. Tomchick

EDWARD A. TOMCHICK
Director, Division of
Trade Adjustment Assistance