In addition to preparing EB-5 jobs reports and obtaining TEA letters, we offer EB-5 economics due diligence services. As a part of this service, we review the business plan, economic impact study, and the TEA letter for consistency and point out any issues that might trigger an RFE. Anyone who has put together an EB-5 offering knows that the documents go through multiple revisions so it is important all of the materials are singing the same tune before they are submitted to the USCIS. Other than construction budget inconsistencies and timeline ambiguity, the most common issue we see in the projects we review has to do with the timeliness of the TEA letter. Given that the USCIS has cited “old” TEA letters as a common reason for RFEs, this is a critical piece of the EB-5 puzzle that can cause delays if not addressed.
An EB-5 project site needs to be shown to qualify as a TEA at the time the petitioner makes the investment in the project or when the petitioner’s I-526 is filed. Generally, a TEA is “current” from the time the state agency issues the letter until the state agency updates its TEA data. States typically update their data on an annual basis in the March to June time frame.
Recently we reviewed a project that had a letter from a consultant economist – not the state agency – that indicated the site would, in all likelihood, qualify as a TEA. That’s encouraging news for the developer and regional center but certainly not the type of evidence required by the USCIS. We suggested the developer obtain an official TEA letter keeping in mind that we were in TEA-data-limbo-time as new data were about to be released. No fooling, the developer obtained a TEA letter on April 1st using 2014 annual unemployment data, soon to be eclipsed by the 2015 annual data which was finalized and released last week. Unless the developer was obtaining a TEA letter for a petitioner who already made the investment or for a petitioner who planned to submit the I-526 in the next few days, the April 1st TEA letter is as worthless as the economist’s letter.
This post isn’t intended to disparage independent opinions on TEAs – actually this can be extremely helpful information when you are in the planning stages before submitting an I-526 petition. When clients contact us regarding a potential TEA site when we’re in TEA-data-limbo-time for that particular state, we answer two questions: (1) will the site qualify using the state’s current data and (2) is it likely the site will qualify using the state’s soon-to-be released data. One state, Illinois, regularly institutes a moratorium on TEA letters so as not to waste their time or the time of those seeking TEA letters in this TEA-limbo-period.
To sum up, make sure your TEA letter is current when you submit the I-526 petition or receive the investment and if you’re unsure of the timing just ask Impact DataSource.