I am a hotel developer who owns land in Paradise Valley, Arizona. We have a hotel project in mind that we would like EB-5 financing for. Does Paradise Valley qualify as a Targeted Employment Area (TEA)?
The potential investor in the project would need to contact the Arizona Department of Commerce to give them the coordinates of the exact tract of land in order to determine whether or not it qualifies. As attorneys, this is something that we do for our clients in the beginning of the process.
The project itself does not make a difference for a reduced amount of investment necessary for EB5 immigrant classification. Geographic location of employment creation is. According to USCIS "A targeted employment area is an area that, at the time of investment, is a rural area or an area experiencing unemployment of at least 150 percent of the national average rate. A rural area is any area outside a metropolitan statistical area (as designated by the Office of Management and Budget) or outside the boundary of any city or town having a population of 20,000 or more according to the decennial census." Look for a designation of Paradise Valley by Office of Management and Budget to determine if you can offer $500k investment packages to your investors.
You will have to contact the State Labor department or Paradise Valley City to check on their unemployment number. However, in order to qualify for TEA, the unemployment rate must be 150% of the national average according to the Bureau of Labor Statistics. According to BLS, Arizona is showing 7.8% unemployment, which is similar to the national unemployment number.
The TEA designation depends on the location of the business and the address of it.
You need to do some homework. If it''s in a rural area, you need to find whether it qualifies as a rural area within the definition under EB5 program. If it?s in a city, the city must experience a high unemployment rate defined under EB5. Or you can get a designation from your state officials.
TEAs are determined by your state. You would have to communicate with the agency that handles employment statistics and get certification that your area qualifies for TEA designation.
Each State has a state government agency which provides a frequent list of TEA''s,( TEA''s are areas of high unemployment or rural ares). Please note a TEA can be based on a political or economic subdivision.An Economist who is familiar with the EB5 rules and policies can assist in the analysis of whether a particular geographical area is a TEA.
A Targeted Employment Area is a local region (which can be loosely drawn) in which unemployment is greater than 150% of the national average. While this seems like a straightforward matter, there is actually a science (and an art) to selecting the appropriate census tracts (which are expected to feed workers to the Project and must be contiguous to the Project and/or each other) in order to achieve the requisite unemployment figures. Your question will require an analysis, which is beyond the scope of what can be expected on this forum.
If it qualifies as a rural area, nothing else is required. If not, you need to determine if the location has an unemployment rate of 1505 of the national average. If not, you need to obtain a state TEA designation letter based upon census tract aggregation.
A TEA is either a ''rural area'' or an area with an unemployment rate of at least 150% of the national average unemployment rate. Please seek the counsel of an experienced EB-5 professional to see if your project meets the definition of a TEA.
You would have to look at the unemployment data for your area of investment - if it is 150% of the national average (currently 7.8% so it would have to be an area where unemployment is 11.7%).
There are two ways it can qualify. One is if it is rural (not in a town of 20,000 or more people AND outside of an MSA). To determine if it is not in a MSA, the census bureau maps are helpful. http://www.census.gov/geo/www/maps/stcbsa_pg/stBased_200411_nov.htm The other way it can qualify is if the employment is at 150% of the national average. This is more difficult to determine as it varies by census tract. Some states and cities are helpful in ascertaining this information while others are not.
That is a determination made together with the attorney and economist.
Many states have prescreened census tracts to determine if an area qualifies for ''targeted employment'' status or not. Your best source is the department of labor in the state or the chief economist.
Contact the state agency has been designated by the governor.
Determining if a project is within a TEA depends on if it either A) meets the definition of "rural" under the regulations, or B) is located in a municipality, census tract, or within other political boundaries that have an average rate of unemployment that exceeds 150% of the U.S. national average.
Several options may be available. The regulations allow for a reduced investment $500,000 if the new commercial enterprise has or will create employment in a qualified "rural area" (meeting the rural area test) or in "high unemployment area" (meeting the high unemployment area TEA test). Rural area test may be met if the investment target is located outside a standard metropolitan statistical area (MSA) *and* also in a city or town outside MSA with a population of no more than 20,000 based on the most recent decennial census of the US. MSAs are geographic areas defined by the US Office of Management and Budget (OMB) for use by federal agencies. For statistics on a city or town population, USCIS expects evidence from the US Census Bureau. All evidence should come from the OMB and the Census Bureau. High unemployment statistics test may be met by the following evidence: 1. MSA, the specific county within the MSA, or the county in which a city or town with a population of 20,000 or more is located, in which the new commercial enterprise is principally doing business, has experienced an average unemployment rate of 150% of the national average rate (may be demonstrated by US DOL BLS National Unemployment Rate Report for national average and LAUS local unemployment statistics report for the area covering the new commercial enterprise (which could still be too generalized for smaller areas), or 2. As an alternative, a state designation letter from an authorized body of the government of the state (such as a state Employment Security Department), in which the new commercial enterprise is located, which certifies that the geographic or political subdivision of the MSA or of the city or town with a population of 20,000 or more, in which the enterprise is principally doing business, has been designated as a high unemployment area.
You can talk to an attorney who has filed these and see get an opinion. There is no preliminary opinion from USCIS, however.
A study needs to be done to prove if it is.
Contact the Arizona Department of Commerce. On October 6, of 2009, Governor Janice K. Brewer delegated the authority to the Arizona Department of Commerce to certify high unemployment areas that meet the qualifications for the EB-5 Immigrant Investor Visa Program administered by the U.S. Citizenship and Immigration Service (USCIS). You should call the AZ Department of Commerce.
You really need an economist to do an economic impact study. You can get a good idea based on the unemployment rate in the area.
There are two types of TEA - one is a rural designation that is determined by the federal government and the other is based on unemployment designated by the State. We would have to look at the census tracts and talk with the agencies involved to determine whether the area you seek would qualify as a TEA. Unfortunately there is no other way.
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