Lawyers representing EB-5 investors should be aware of the latest USCIS
adjudications trend challenging claims of construction jobs by means of
requiring third-party validation of construction data and regional industry
standards. Immigration lawyers should now ask the Investor's selected Regional
Center to provide such supporting evidence in advance of filing the I-526
petition or in anticipation of the RFE.
Ever since Matter of Ho, 22 I&N Dec. 206 (Assoc. Comm'r 1998),
USCIS has required the submission of a "comprehensive business plan" in the Form
I-526 filing to clarify the investor's claimed job creation projections. But
recently, the USCIS has expanded its standard requiring a more detailed and
verified analysis of any construction phase jobs.
When a Regional Center project claims a construction period exceeding 24
months, EB5 investors can claim direct, indirect and induced jobs resulting from
the construction phase activities and qualified construction expenditures. When
the business plan making such job claims is submitted to the USCIS as part of
the I-526 petition, the agency will apply the following test:
"Because construction will surpass two years, the petitioner must present a business plan with a more detailed and itemized construction timeline showing all relevant phases of the construction effort. The business plan must also provide transparent, objective, and verifiable data illustrating that the proposed construction timeline and budget are within a reasonable range when compared to industry standards."
In failing to meet this standard with an initial I-526 filing package, the
USCIS will issue an RFE for such records. In response, the Regional Center will
need to supply associated investors with an evidence package that contains
third-party opinions verifying or explaining business plan claims relating to
construction activity and assumptions. These may include following:
- General Contractor's Detailed Construction Timeline. This
report breaks down all phases of the build-out, by date and subcontractor
specialty/trade. The timeline should provide expected start and completion dates
for each distinct activity.
- Third Party Validation of Construction Timeline. This
expert opinion assesses the project's construction timeline claim and measures
the timeline against regional industry norms.
- Third Party Validation of Construction Costs. This expert
opinion assesses the itemized budget costs and compares them with verifiable
data, analysis, and industry standards. Reliable construction costs are
important to the USCIS because these are direct inputs to the economic modeling
that calculates job creation.
These are just a few examples of how a comprehensive business plan claiming
construction jobs may effectively utilize third-party verification of critical
construction data, budgets, timelines and assumptions to ensure Matter of Ho
compliance. Given the emerging USCIS trend in this area, EB5 lawyers should be
prepared to supply exhibits which contain transparent, objective, and verifiable
data illustrating that the proposed construction timeline and budget are within
a reasonable range when compared to industry standards. And note that such
third-party construction experts are not in lieu of the Regional Center's
economist calculating the job creation, but are rather in addition to the