 An article in the New York Times has highlighted a potential weakness in the EB-5 visa program that may impact on certain regional center projects. The EB-5 visa requires an applicant to invest $500,000 to $1,000,000 in what are termed regional centers; these centers are approved by The United States Citizenship and Immigration Service (USCIS).
The EB-5 visa has proved an increasingly popular choice in 2011, interest in the program has grown so fast that the USCIS are attempting to streamline the application process.
Given the tightening of credit availability the EB-5 has been viewed by some real estate developers as the ideal way to raise funds, particularly for construction projects.
The idea behind the program is to create jobs, ten per $500,000 investment in targeted employment areas [T.E.A’s]
An examination of the program by The New York Times suggests that in New York, developers and state officials could be stretching the rules to qualify projects for this foreign financing.
There is concern that developers are relying on gerrymandering techniques to create development zones that are meant to be in areas of high unemployment (thus qualifying for the $500,000 investment) but according to federal and state records are in prosperous ones.
The article mentions as a prominent project the International Gem Tower, a 34 storey glass tower in Manhattan that is to cost $750 million with one fifth of the funding coming from EB-5 applicants.
Although it is being built in an area that is reported as one of the wealthiest in the country, the Times reports that through the selective use of census statistics the project falls under (the $500,000) EB-5 requirements.
The newspaper reported that during an interview a senior federal immigration official, Alejandro Mayorkas, acknowledged that the program may need more scrutiny and maps being approved by certain states might not adhere to the spirit and intent of regulations.
There is mention of another area which has been classified as being located as an area that needs help attracting jobs; however there are concerns that the zone resembles a gerrymandered political district.
The article does raise an issue that may be of concern, in that if a particular EB-5 project is judged not to be in a properly qualified Targeted Employment or Rural area the $500,000 investment should actually be $1,000,000.
The continued importance of obtaining independent impartial advice before considering a move to the USA, using the EB-5 visa program, is critical. As a first step it is worth studying the only published consumer guide on the EB-5 process Green Card via the Red Carpet which is available at Amazon.
For personal, one-on-one, impartial information on the EB-5 visa contact Which EB-5 via Email or telephone at +1-561-771-1330
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