Connecticut recently introduced its first regional center, the New England Federal Regional Center, creating huge opportunity for economic growth and development in the Hartford area through the EB-5 visa program. Although a late start, the regional center will provide opportunities for job creation and the creation of new businesses.
The EB-5 program provides a valuable source of low interest funding for both current and future business owners. The program is administered by United States Citizenship and Immigration Services (USCIS) and was created by Congress in 1990 to stimulate the U.S. economy through job creation and to encourage foreign investment into the United States by offering green cards to qualified foreign investors and their families. The EB-5 program requires a foreign investment of $1,000,000, or $500,000 into a U.S. business.
Since its conception, the EB-5 program has developed a strong track record in stimulating the U.S. economy and creating jobs, especially in economically distressed areas. The program has created tens of thousands of jobs across the country, leading a number of senators, including Senator Patrick Leahy, to become proponents of making the program permanent in the U.S.
However, although the EB-5 program provides an opportunity for low interest financing, business owners must fully evaluate all aspects before proceeding. This evaluation should always involve an EB-5 attorney, corporate attorney, tax consultant, and an economist fully versed on all aspects of this complicated program.
Current and prospective business owners must completely understand the risks of using the EB-5 program to procure investments in their business. Regional centers are expected to have what is called an “exit strategy” in which the foreign investor withdraws from the investment. Most regional centers are structured so that the foreign investor can withdraw his or her investment after five to six years. While the investment is “at risk,” a prudent foreign investor looks for the likelihood of the return of the principal after said period of time. Therefore, having a sound exit strategy is a key factor for the success of investors, regional centers, and independent businesses.
With the U.S. lending market still recovering, the EB-5 program creates a plausible opportunity for Hartford businesses by providing low-interest loans for companies or developers. With a cap of 10,000 visas available each year, a sum of at least $5 billion is available for investment into U.S. businesses annually.
Hartford businesses looking to expand or develop may find the opportunity for low-interest loans highly appealing. However, all U.S. business owners should receive a full professional evaluation and understand the terms of receiving such loans before proceeding with the EB-5 program.
Attorney Marjan Kasra heads up the immigration practice at the Law Office of Marjan Kasra, LLC in Stamford, CT. She specializes in EB-5 practice, and actively counsels foreign investors, as well as local businesses. Attorney Marjan Kasra is an active member of AILA (American Immigration Lawyers Association), and a regular contributor to EB5Investors.com.