In the Title 8 of the Code of Federal Regulations (CFR), Section § 204.6 (i), a Targeted Employment Area (TEA) is defined as a rural area or an area experiencing high unemployment rates. TEA is designed using Census tract data. Eligible TEAs include Metropolitan Statistical Areas (MSA), Census Designated Places (CDP), counties, and cities. By doing so, Congress encourages immigrant investors to get money over areas that may be suffering from economic crisis. Targeted employment area designation is requested within the I-526 petition for an EB-5 $500,000 investment.
What is a Rural Area?
As designated by the Office of Management and Budget, a Rural Area is any area outside a metropolitan statistical area (MSA) that is outside the boundary of any city or town. Designated Rural areas must have a population of 20,000 or more, determined on the most recent decennial census of the United States.
There are specific criteria to qualify as a TEA Rural area, during an EB-5 project location petition.
What is a High Unemployment Area?
Any state government of the U.S. may label a particular geographic or political subdivision located within a metropolitan statistical area as an area of high unemployment, using the census-share methodology, as permitted by the U.S. Citizenship and Immigration Service (USCIS). This area may be designated by a state authority or independent economists for counties or cities, which have experienced unemployment of at least 150 percent of the national average unemployment rate. For example, based on the 2013 annual average U.S. unemployment rate of 7.4 percent, the minimum unemployment rate needed to qualify as a TEA was 11.1 percent.
In many states, a TEA may also be designated by combining multiple contiguous census tracts where the unemployment rate of the resulting region exceeding the high unemployment threshold.
An official of the state must inform the Associate Commissioner for Examinations of the agency, or any appropriate governmental body of the state which has to approve the high unemployment area.
High unemployment areas should also have a large labor force. High unemployment but low numbers in the labor force will not be profitable, as these calculations are weighted on averages.
How can you get a TEA designation?
The TEA denomination is a fundamental step of the I-526 petition. An Eb5 petition can receive TEA designation if the principal location of the project is located in a high unemployment area at the time the EB5 investment is made.
To get a TEA designation, you have to obtain a letter from State government body to provide rural area or high unemployment area evidence, and send it to the USCIS. Then, you have to keep in touch with the U.S. Bureau of Labor Statistic’s Local Area Unemployment Statistics (LAUS) office to obtain published technical bulletins. You have to provide any statistical documentation.
What are the advantages of investing in a Regional Center located in a TEA?
Here are the advantages of investing in a TEA:
– Less amount of capital necessary to make a qualifying investment ($500,000 rather than the $1,000,000);
– No daily management is required;
– The investor does not have to work or can be retired, he can live and work with his family anywhere in the U.S.;
– No necessity of creating 10 direct full-time positions. The jobs created from the investment can be direct or indirect;
– Finally, the enterprise will regularly and continuously provide goods and services that support job creation in areas suffering from economic crisis.
An experienced immigration lawyer can help you choose the most attractive Regional Center option and handle your EB5 Green Card application.