California Firm Seeks Tax Break for Desalination Gear
Published Date: 6/15/2026
Notice
Summary
Energy Recovery Inc. wants to start making desalination equipment in their San Leandro, California facility inside Foreign-Trade Zone 18. This means they can bring in certain parts from other countries with lower or no import taxes, helping them save money and speed up production. People have until July 27, 2026, to share their thoughts on this plan.
Analyzed Economic Effects
3 provisions identified: 2 benefits, 1 costs, 0 mixed.
Import Parts at Low or No Duty
Energy Recovery Inc. plans to bring specified foreign parts (like stainless steel pump parts, titanium interconnects, and fiberglass housings) into its San Leandro facility under Foreign-Trade Zone procedures where duty rates on those parts range from duty-free to 2.8%. This lets the company avoid or reduce import taxes on those listed components.
Finished Product Duty-Free Status
The proposed finished product—high pressure exchanger units—has a duty rate of duty-free when produced in the FTZ facility in San Leandro. That classification is explicitly listed in the notification.
Section 122/301 Materials Must Get Privileged Status
The request notes some materials are subject to duties under section 122 or section 301 of the Trade Act of 1974 and must be admitted to FTZs in privileged foreign status under 19 CFR 146.41. That requirement applies depending on the country of origin for those materials.
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Key Dates
Department and Agencies
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