- December 10, 2016
- Posted by: eb5-economist
- Category: About the EB-5 Program, EB-5 Economics, EB-5 Job Creation
Removing the conditions on a Green Card is the ultimate goal of EB-5 investors, and the burden of proof for demonstrating that all EB-5 Program requirements have been met generally falls to regional centers and project developers.
Two things must happen for the I-829 submission to be successful:
First, the regional center must prove that each investor’s funds were continuously invested in a new commercial enterprise. Typically, regional centers use proprietary or third party tools to track the flow of funds over the course of the investment.
Second, the regional center must prove that enough jobs were created per EB-5 investor. Demonstrating adequate job creation, however, is the biggest challenge for I-829 petitioners. Regional center projects do not typically track physical employees, so they must rely on other documentation to prove indirect and induced employment impacts. Using a project’s original economic report as a guide, regional centers and project developers should document all model inputs including hard and soft construction expenditures and operating revenues.
Depending on the actual project expenditures and revenues, a new economic report may be necessary to determine how many jobs were created by the time investors begin submitting I-829 Petitions. While USCIS does not require jobs to be created in the exact manner outlined in the original model, the agency does require I-829 Petitions to clearly demonstrate the requisite number of jobs have been created. In any case, it’s generally a good idea to submit an updated job creation exhibit as part of the I-829 filing package to remove any doubt that a sufficient number of jobs have been created.
With respect to the construction timeline, we’ve seen several issues arise if construction is longer or shorter than originally planned. Direct construction jobs can be counted only if the actual construction time lasts longer than 2 years. A new economic analysis will be required if the construction timeline was originally projected at more than 2 years but the actual construction time period lasted less than 2 years. On the flip side, projects that take longer than expected can count a greater number of jobs from construction, which can be beneficial if other areas, such as revenue from operations, experience shortfalls. In either instance, however, a new economic analysis is recommended.
Since the I-829 process begins at different dates for each investor, it is generally a good idea to begin updating job creation reports before the 1st applicant’s I-829 filing window opens. Our firm actively works with developers and regional centers to prepare I-829 economic reports, and we also help with the supporting documentation needed to successfully remove investors’ Green Card conditions. Email us or visit our services page today to learn more and get started.