California Adopts a Broader Targeted Employment Area (TEA) Designation Policy Effective May 1, 2013.
California has adopted a broader Targeted Employment Area (TEA) certification designation policy effective May 1, 2013.
Generally, an immigrant investor must invest at least $1,000,000 in capital to qualify under the EB-5 Program. INA § 203(b)(5)(C). However, an EB-5 investor can qualify for the program with $500,000 in investment capital if the investor invests in a “targeted employment area” (TEA).
Q: How does one identify a targeted employment area (TEA)?
The U.S. immigration law defines TEA as (1) a rural area or (2) an area which has experienced unemployment rate of at least 150% of the national average rate.
Q: What is a rural area?
Rural area is defined as (1) an area that is not a metropolitan statistical area (MSA) as designated by the Office of Management and Budget or (2) an area within any city or town with a population of less than 20,000 based on the most recent U.S. census.
Q: How do I know if my business enterprise is doing business in a high unemployment area?
First, the business must be located within one of three areas: (1) metropolitan statistical area, (2) the specific county within a metropolitan statistical area, or (3) the county in which a city or town with a population of 20,000 or more is located. Second, the unemployment rate in the area must have experienced an average unemployment rate of 150% of the national rate. For example, in 2012, the Riverside County qualified as a high unemployment area. However, only some cities in Los Angeles or Orange counties qualified as a high unemployment area. Some of these cities include El Monte, Industry, Montebello, and Stanton.
The USCIS can designate the area as TEA based on the supporting documents submitted as part of an EB-5 investor’s petition. Some states can also issue a TEA certification letter to facilitate the EB5 process. Currently, many states including California, Texas, Florida and New York have agencies designated to certify TEA for the EB5 program.
Q: What is the California TEA certification procedure and what changes were made?
California maintains a list of the designated areas for certification. If your enterprise is principally doing business in an area designated under this list, then the state will issue a designation letter valid for one year. If the enterprise is not in the list, the procedure involves obtaining the unemployment rate using the census tract number.
The new policy allows a broader, special TEA certification letter based on an average unemployment rate of twelve or fewer contiguous census tracts and a supporting letter from the local government agency. This new policy means that California can now certify some projects, which previously did not qualify, as a TEA project.
Visatopia can quickly confirm whether your business is located within TEA and assist in obtaining the TEA certification letter. Please send your inquiries to info@www.visatopia.com.