EB 5 Newsletter March 2012

Joe Whalen’s EB-5 Roundup March 5, 2012There is More to the EB-5 ImmigrationPilot Program than Regional Centers Small-Scale, Single Project Regional Centers Need Not Apply!Some folks have begun to panic needlessly. The EB-5Immigration Pilot Program is not about to come to a If you believe the statute, then in order to obtainsudden demise. The Customer-Base has blossomed and approval as a Regional Center in the first place, youin their enthusiasm, some folks have cast their nets too cannot start too small as in with a single kind ofwidely, prematurely, or in an empty pond. I see some commercial enterprise. Some USCIS adjudicators seemunderlying issues that folks need to closely consider as confused about that issue as the would-be Regionalbefore venturing into EB-5 or re-examine prior to filing Center applicants.any challenges to CSC via Motions or AAO via Appeals. If you start with only one very limited possibility and itNot all the plans currently seeing RFEs are worth fails then you’re dead from the start with nowhere to go.fighting for “as is”. It may be more practical and In addition, the Regional Center is not supposed to be aeconomical to withdraw and file a new application later. short-term, single-project investment scheme with littleThere are some fundamental misconceptions floating or no growth potential.about that practitioners (as well as USCIS) need to meet What would be the point of placing the Regional Centerhead on and put to rest once and for all. into a Program if a single-shot developer could get Regional Center Designation and allow EB-5 investorsWhat is the True Nature of the to use it as a means to include indirect jobs for a singleImmigration Pilot Program? project and then close its doors? It would defeat the Congressional Intent of creating an on-going ProgramTo date, we have all been fooled (including yours truly) comprised of a new business infrastructure consisting ofinto referring to this visa pathway as the Immigrant Regional Centers as a conduit to drawing foreignInvestor Pilot Program. That is what INS named it in the investors into the U.S. economy. At least that’s how Iregulations. However, if you closely read the statute and see it.follow the threads (cross-references) it should be called I can see one large-scale, multi-faceted, mixed-usethe Employment Creation Visa Pilot Program. 1 project2 as a starting point upon which a Regional CenterThe Regional Center is a fundamental prerequisite entity can “cut its teeth” because it would addresscomponent of the EB-5 Pilot Program. A Regional multiple components. For example, a first effort mightCenter Proposal may be somewhat “general” but with include: retail space, food and beverage operations,enough specificity as to: the kinds of commercial transient housing, various types of office space, variousenterprises that will receive capital from aliens, a service businesses, and/or an entertainment venuelimited geographic area, as well as the direct and (theatre). If a huge factory is being built, it is likely toindirect jobs, and the other positive economic effects require specific infrastructure developments to supportsuch capital investments will have. it. Rail spurs, docks, road building and maintenance, utilities expansion, sanitation projects, services to theIn addition, the Pilot Program allows the EB-5 investors new workforce as well as the new business. Additional(through their Regional Center partners’ efforts) to independent projects that utilized any one or aestablish reasonable methodologies for determining the combination of the various “kinds of commercialnumber of jobs created. The preceding criteria have all enterprises” already addressed would then be availablebeen pulled directly from the statute so are of paramount for additional investment opportunities.importance to the successful establishment of a RegionalCenter.1 2 See http://www.slideshare.net/BigJoe5/what-is-the- See http://www.slideshare.net/BigJoe5/rc-affilated-eb5-immigration-pilot-program structure-option Visit me at: http://www.slideshare.net/BigJoe5 and http://eb5info.com/eb5-advisors/34-silver-surfer

Joe Whalen’s EB-5 Roundup March 5, 2012Piggybacking Efforts vs. Stolen Glory; take credit for the jobs already created by someone else’s efforts. So, if a Regional Center wants to count andand Too Much Risk Avoidance in EB-5 allocate the jobs from day one, they need to be committed at the groundbreaking or almost immediatelyThe next problem that I can readily see are situations thereafter. This is not to say that the Regional Centerwhere the RC hangs back searching for a project that has must obtain all of its EB-5 investors prior to breakingalready broken ground. If you wait until too late in the ground, merely that the Regional Center be committed toproject before committing to it, there is not much left for the project it wishes to promote to aliens seeking EB-5you to take credit for. Now, here are some possibly and visas early enough in order to reasonably lay claim tohopefully useful clichés to help you see this point better. those early jobs. It is also in these early commitment situations where the various potential financialThese first few relate to timing : maneuvers need to be laid out to USCIS. The Regional Center is more free to be creative than many incorrectly  The early bird gets the worm. (Right to claim believe. early created jobs.)  Arriving [too] late to the party. (Too few jobs created after joining in.) Joe Whalen has years of  Missing the boat. (Trying to buy-in to a experience in immigration completed project.) adjudication. He is most responsible for growing  Haste makes waste. (Committing TOO early to a the EB-5 Regional Center low job-yield project.) Program from obscurity  Life is passing you by. (Again, trying to buy-in into a thriving growth to a completed project.) industry.These next few clichés relate to nexus3: Joseph P. Whalen  Riding coattails. (Piggybacking off someone e-mail: Silver.SurferEB5@gmail.com or else’s success in a good way.) joseph.whalen774@gmail.com  Building a foundation. (Creating job creation opportunities for your “project partners”.) Upcoming In-Person Events  Stolen glory. (Piggybacking off someone else’s I will be discussing the latest developments in EB-5 success in a bad way.) especially to do with Regional Centers at two presentations  Someone “standing on your shoulders” vs. you in April. I will serve as a faculty member at the American “standing on theirs”. (Need to strike a balance.) Immigration Lawyers Association (AILA) 2012 EB-5 Investor & Regional Centers Conference: A Practice Skills Workshop to be held Friday - Saturday, April 20-So how does any of that relate to a Regional Center? 21, 2012 at the Atlantis Resort Hotel in Nassau, Bahamas.Risk avoidance is a natural instinct. Unfortunately, in Please check the AILA EB-5 Conference webpage for theEB-5 at any rate, too much risk avoidance defeats the Event Agenda. AILA has filed for CLE and specializedCongressional Intent of the Regional Center Program.Congress chose to reward aliens with visas for taking a credit in all jurisdictions with mandatory CLE andchance on the United States through their efforts to specialized requirements. Registrations Information isincrease employment opportunities and otherwise found here.promote economic growth. Congress did not envisionallowing aliens to usurp the successes of someone else The following week I will present at the Friday April 27,and “buy” a well-advanced or completed project and 2012, Event in NYC. See more at: http://www.eb5newyorksummit.org/ and3 See http://www.slideshare.net/BigJoe5/how-many-kinds-of- Register here: http://newyorksummit.eventbrite.com/ &nexus-can-you-find-within-eb5 See me at: http://eb5news.blogspot.com/ Visit me at: http://www.slideshare.net/BigJoe5 and http://eb5info.com/eb5-advisors/34-silver-surfer

EB 5 Newsletter March 2012

by Joseph Whalen on Mar 05, 2012

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