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ILW.COM EB-5 Blog

What Is A “Targeted Employment Area”?

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The United States Citizenship and Immigration Services' (USCIS) EB-5 Immigrant Investor Program offers foreign entrepreneurs two options for obtaining permanent visas. Both options involve the investment of at least $500,000 in a commercial development in the United States. But investment alone is not enough; the commercial enterprise in which the investment has been made must preserve or create 10 full-time jobs.


USCIS has established two investment levels for the EB-5 program: $500,000, and $1,000,000. The same program requirements apply to each of these investment levels, with a few significant exceptions. Foreign investors with very high net worth may favor the more expensive route - the $1,000,000 investment option - because the commercial enterprise in which the investment is made can be located anywhere in the United States. The job creation requirements, however, remain essentially the same - 10 full-time jobs must be preserved or created within two years of the investment.


On the other hand, the $500,000 investment option represents a lower financial barrier to entry for foreign entrepreneurs seeking a permanent visa, but it comes along with an important condition: the commercial enterprise in which the investment is made must be located in what USCIS terms a "Targeted Employment Area," or TEA. According to USCIS, a Targeted Employment Area is one that is experiencing 150% of the national unemployment rate, or a rural area located outside a Metropolitan Statistical Area (MSA) or which has a population more than 20,000.



Because TEA is specifically defined by USCIS' EB-5 program regulations, it is important for foreign entrepreneurs to know how to obtain relevant information about a community in the United States where they are contemplating developing a commercial enterprise. The burden is on the investor to demonstrate to USCIS that the area in which the commercial enterprise is being developed is a Targeted Employment Area.


One way an investor can get information about TEAs is through an internet search. The EB-5 program has grown in popularity in recent years, and there are now dozens of websites that provide information (or links to information) about TEAs, MSAs, and statistical data that could guide an investor's research. The U.S. government itself can be quite helpful in this regard; the Bureau of Labor Statistics, the Census Bureau, and USCIS itself provide information that could be quite helpful for a foreign investor on their websites. Even county-level unemployment information can be found on the Census Bureau's website. These and other websites also allow investors to type in an address or view a geographic region to determine whether the community being looked at is a "rural area" within the USCIS' definition.


Some states, such as California, provide information about TEAs within their borders and even offer TEA certification letters for investors, which can then be submitted to USCIS. USCIS generally does not challenge state TEA certifications. If a state does not certify TEAs, the investor(s) must obtain TEA designation from USCIS - no commercial enterprise can qualify for the $500,000 EB-5 option unless USCIS signs off on the area in which it will be located.
However, investors must also be aware that the status of a TEA may change over time, even during the lifetime of an EB-5 commercial development. Therefore, if there is a change in the unemployment rate or population of an area in which an EB-5 commercial project is underway, the TEA certification could be revoked. The TEA status of an area is established when the foreign entrepreneur makes the $500,000 investment or files an EB-5 petition, whichever occurs first. It appears, then, that a foreign investor would be well-advised to file an EB-5 petition or make a financial investment very soon after a location for a commercial enterprise has been identified, in order to "lock-in" its TEA designation.

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