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EB-5: Understanding Regional Centers, Part 1

The EB-5 immigrant investor visa pathway may be complex, but it can be boiled down to a simple fundamental formula: An investment + job creation = a green card for you and family. Whether the EB-5 is right for you can be a challenging decision, and if you have questions about the EB-5 visa category, please contact our experienced immigration attorneys or call The Law Firm of Shihab & Associates, Co., LPA at the nearest office close to you to consult with an attorney.

Investment in Regional Centers and Targeted Employment Areas

A “regional center” is a public or private entity that has obtained a USCIS license, and that is focused on attracting investors for regional development and growth. They work with EB-5 investors typically either in an equity or loan model, either as general partners involved with the project, or as project financiers, collecting investor money and then loaning it to a third party project leader.

“Targeted Employment Areas” (TEAs) are often where regional centers are located. These are either in “high unemployment areas,” or “rural” areas. A “high unemployment area” is one having a documented unemployment rate of at least 150% of the published national average. “Rural areas” are designated areas distant from large metropolitan areas and towns with populations greater than 20,000 residents.

There are many benefits to investing with regional centers located in TEAs. Areas with “high unemployment” could be attractive urban downtown areas that are located near areas of high unemployment. There are also exceptions to normal USCIS requirements for TEAs and regional centers. For example, you only need to invest $500,000 instead of $1 million for your EB-5 petition in a TEA. Additionally, for a regional center investment, you do not need to show job creation for “actual” persons, but you can instead show “theoretical” job creation using economic models and other reasonable methodologies. These can include direct jobs, indirect jobs, or even induced jobs, which are the jobs created in the community involving housing, food, transportation, or entertainment that flow from the investment and the direct jobs created.

The Procedural Steps to Obtain Your EB-5 Visa

An EB-5 visa is a two-year conditional visa, which requires you to complete requirements by the end of the two-year period to have the conditions removed and to become a permanent resident.

The procedural steps of an EB-5 visa include:

  1. File an I-526 Petition: This requires you to document the lawful sources of your investment funds, give a comprehensive business plan that proposes to create jobs, show that you are a new commercial enterprise, and show that you will have some active managerial role in the enterprise.
  2. File a DS-260 or I-485: This is either an application for consular processing if you are located outside the U.S., or an adjustment of status petition if you are already within the U.S.
  3. File an I-829 Petition: At the end of the two-year period, you must document and show that the required funds were invested, jobs were created, and other conditions were met, and then your visa conditions will be removed and you will be granted permanent resident status.
Risks and Benefits to Consider as an EB-5 Investor

If you are a potential EB-5 investor, you are likely a successful business or property owner in your home country, and it is important to evaluate your goals and concerns. New investments carry potential risks, but also many potential possibilities for gain. Your new commercial enterprise has the possibility of greatly benefitting you, your family, and the local economy that is strengthened by your new business and the new revenue and jobs it creates. You may be concerned about business planning, tax, and family member immigration issues, and you will want to maximize your benefits and minimize your risks. You may even wish to maintain your existing successful business in your home country. When evaluating your immigration and business strategy, it is very important to have knowledgeable assistance who will consider all the factual and legal elements that may apply. If you have questions regarding the EB-5 visa category, please contact our experienced immigration attorneys at The Law Firm of Shihab & Associates, Co., LPA to consult with an attorney.

Federal Agencies Involved with the EB-5 Visa Process

While the USCIS is the primary federal agency involved with the EB-5 program, it has struggled to manage a visa category that requires a broad array of expertise in highly complex fields. Recently it has added in-house experts to assist with complex business and finance areas, but other agencies play a role in the process as well.

The Department of State (DOS) is involved with processing immigrant visa applications overseas at U.S. consulates and embassies. You will interact with DOS if you are filing a DS-260 application overseas.

The Securities and Exchange Commission (SEC) ensures that federal securities laws are followed, and they oversee regional center-based investments. This usually requires accurate truthful reporting and the disclosure of required investor information.

The Internal Revenue Service (IRS) will require new commercial enterprises to meet all tax obligations, and it is often critical for an EB-5 investor to obtain separate tax counsel to consider all the relevant tax considerations of their business plan.

The Office of Foreign Assets Control (OFAC) may become involved if the source of funds creates an issue with U.S. foreign policy or national security goals, such as investor funds from countries the U.S. has imposed sanctions against.

Contact Us

If you seek to immigrate to the United States as an immigrant investor, contact the experienced attorneys at The Law Firm of Shihab & Associates. Our lawyers have more than 50 years of combined experience in a variety of complex legal matters.

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