EB5 Investment Amount
Daunting EB5 investment amounts can make green cards harder to obtain if you don’t have $1 million handy. However,you may qualify for a reduced EB5 investment amount of $500,000, if you consult your immigration lawyer and pursue a Targeted Employment Area.
A region is designated a TEA if it has an unemployment rate that is 150% of the national average. A TEA can also be a rural area.
You must establish the validity of a TEA before qualifying for an EB-5 investment amount of $500,000. You must also present documentation of TEA statistics to USCIS in support of your I-526 Petition.
According to the law (AFM 22.4 (c)(4)(F)(iii): “Evidence of such a designation, including a description of the boundaries of the geographic or political subdivision and the methods by which the unemployment statistics were obtained, may be submitted in support of the Form I-526 in lieu of other documentary evidence.”
To obtain a green card with an EB-5 investment amount of $500,000, the place in which you wish to invest must be considered a TEA, and your I-526 petition must be approved. To demonstrate to USCIS that your investment is in a TEA, you must submit statistical data proving that the region is either rural or has a high unemployment rate. Your immigration lawyer can help you obtain documentation from state and federal agencies confirming these statistics.
Rural TEA: EB-5 Investment Amount
According to CFR 204.6(j)(6)(i), USCIS will recognize a region as rural, and therefore a TEA, permitting EB-5 green card applicants to qualify with an EB5 investment amount of $500,000, if “the new commercial enterprise is principally doing business within a civil jurisdiction not located within an standard metropolitan statistical area as designated by the Office of Management and Budget, or within any city or town having a population of 20,000 or more as based on the most recent decennial census of the United States.”
In other words, there are two main requirements for a region to be designated a rural TEA:
- The region must be outside of a Metropolitan Statistical Area (MSA). An MSA has a population of at least 50,000 and includes counties with urban areas. In 2004, the Government Accountability Office (GAO), which monitors government spending of taxes, announced that 83 percent of the US population lives in MSAs, constituting 1,090 counties.
- The region must have a population of 20,000 or fewer.
Both of these requirements must be met for a region to be considered rural, and therefore a TEA. To determine whether the area in which you are interested in investing is within an MSA, you can determine the population of an area using the American Fact Finder section on the Census Bureau’s Website.
USCIS requires proof, ideally from the Census Bureau rather than local and state governments, for both of these requirements to justify your reduced EB5 investment amount. Your immigration attorney will help you locate this information and present it to USCIS, along with your I-526 petition.
High Unemployment TEA
A region with an unemployment rate that is 150% of the national average can also be designated as a TEA. For example, if, hypothetically, the national unemployment average was 6.2 percent, a region would have to have an unemployment rate of at least 9.3 percent to be considered a TEA.
To qualify for an EB5 investment amount of $500,000, the USCIS must view the unemployment statistics you present as credible. You should acquire your data from the Unemployment Statistic of the Bureau of Labor Statistics (BLS). The BLS determines and reports statistics to the government regarding labor and employment in the US.
Information released by the BLS is open to the public. Your immigration lawyer will help you examine the most recent Current Population Survey and National Unemployment Rate Report released by the BLS to determine the national unemployment average.
BLS also reports monthly data on unemployment rates in 7,300 areas in the US. Examine Local Area Unemployment Statistics (LAUS) with the help of your immigration lawyer to determine local unemployment rates. You can compare these with the national average to determine whether an option qualifies as a TEA, and therefore qualifies for a reduced EB5 investment amount.
When choosing a TEA in order to qualify for a reduced EB-5 investment amount, your immigration attorney may advise you to focus on a small region with high unemployment. However, keep in mind that LAUS covers large areas, and will not reveal unemployment rates of smaller districts or neighborhoods.
Since BLS does not gather or release unemployment statistics for individual neighborhoods and small portions of regions, your immigration lawyer will request a letter from the state government, certifying that the area in which you wish to make an EB5 investment has an unemployment level that is high enough to meet TEA criteria.
Nevertheless, merely receiving a letter of certification from the state government does not guarantee that your EB-5 investment amount will qualify at $500,000. A memorandum within 8 CFR 204.6(j) states “USCIS personnel have no substantive authority to question or challenge such high unemployment designations [as made by the state].” However, the law goes on to explain that USCIS can reject a state’s designation of a region’s TEA status due to high unemployment for several reasons. The state’s designation of high unemployment can be rejected if:
1.The letter of certification does not discuss the methods used to determine unemployment statistics.
2.The state uses statistics from a time other than when you make your EB5 investment.
3.The boundaries of districts are modified to manipulate whether or not a certain region is considered a TEA. This is called “gerrymandering” (This final point is a matter of contention and may or may not disqualify your letter of certification from the state. Its relevance to your EB-5 participation will be best understood by an experienced immigration lawyer).
To increase your chances of having your EB5 investment amount approved at $500,000, your immigration attorney will ask that the state certification letter include information on how the state determined that the region in question suffers from an unemployment rate that is at least one and a half times the national average. Your immigration attorney will also ask that the state provide statistics gathered at a time that coincides with your EB-5 investment in the region.
USCIS’ stance on state-determined TEAs is unclear, making it dangerous to proceed with your EB-5 investment and I-526 petition without the guidance of an experienced immigration lawyer. Gaining approval for a reduced EB5 investment amount in a TEA is a complex process. However, a skilled immigration lawyer will best understand what proof the USCIS requires in order to approve your EB5 green card petition.
Changes in TEA Status for EB-5 Investment Opportunities
State agencies examine regional data yearly to determine which areas qualify as TEAs. The status of the location of a regional center or another EB5 project at the time that you submit your I-526 petition will determine the amount you are required to invest to obtain an EB-5 green card. For example, if you invest in a regional center in a TEA in 2011, you will require an EB5 investment amount of $500,000, and will not need to increase your investment to one million dollars if the project is no longer considered to be within a TEA in 2012. Similarly, if the area in which you invest loses its TEA status after you have made your EB5 investment and obtained permanent resident status, your green card will not be revoked.
However, EB-5 participants who invest in the same regional center in 2012 must invest the full million, even if previous investors gained green cards with an EB5 investment amount of $500,000. USCIS maintains these regulations even if jobs and economic growth created by previous EB-5 investments eliminate the TEA status of a region.
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