Textile Mills Economic Assistance Clears Hurdle

USDA made available the User Agreement for textile mills participating in the Economic Adjustment Assistance Program authorized by the Food, Conservation, and Energy Act of 2008.

December 12, 2008
Contact: Marjory Walker or T. Cotton Nelson
(901) 274-9030

MEMPHIS - USDA today made available the User Agreement for textile mills participating in the Economic Adjustment Assistance (EAA) Program authorized by the Food, Conservation, and Energy Act of 2008.

The EAA program authorizes the Secretary of Agriculture to provide assistance to U.S. textile manufacturers that invest an equivalent amount of funds in capital improvements to their operations by acquiring, constructing, installing, modernizing, developing, converting or expanding land, plant, buildings, equipment, facilities, or machinery. Payments under the program are based on the amount of cotton (domestic or foreign) consumed by the textile manufacturer after August 1, 2008.

The National Cotton Council (NCC) and the National Council of Textile Organizations (NCTO) expressed support for the program and their appreciation to USDA officials for their work in successfully implementing the program in a manner consistent with the statute and Congressional intent. 

NCC Chairman Larry McClendon of Marianna, Ark., stated, "U.S. growers appreciate the importance of the U.S. domestic textile industry and are hopeful this program will help the industry improve its competitive position in the textile and apparel marketplace."

NCTO Chairman/NCC Director Anderson Warlick of Gastonia, NC, said, "The timely release of funds under the Economic Adjustment Assistance program is critically important given the financial challenges faced by U.S. textile manufacturers dealing with uncertain credit markets, a sluggish economy and continued erosion of U.S. markets by subsidized textile and apparel imports. These funds can be an important component of our continued efforts to modernize our facilities and maintain competitiveness.”

Warlick noted that the program called for benefits to be provided as of August 1, 2008, and that participants would need to carefully review the applicable regulations and guidelines before they sign the User Agreement and apply for assistance. The User Agreement is at http://www.fsa.usda.gov/FSA/webapp?area=home&subject=coop&topic=landing.

McClendon stated that given the intense competition in the worldwide textile and apparel market, it was appropriate for the United States to help U.S. textile firms take steps to enhance their efficiency and improve their competitiveness.

"U.S. cotton producers worked with Congress to ensure this program would be budget neutral, even to the point of agreeing to a slight reduction in their own benefits in the 2008 farm bill,” McClendon said.

The NCC and the NCTO worked closely to promote inclusion of the new program in the recently enacted farm law. Program costs were offset by adjustments in the cotton program in order to make the program budget-deficit neutral.

Warlick stated that, "NCC and NCTO leaders look forward to working with USDA to ensure that the program achieves its objectives and that participants fully comply with all provisions of the regulations and User Agreement."