A Targeted Employment Area (TEA) offers EB-5 investors a very appealing option. If they choose to invest in a TEA, the EB-5 capital investment minimum requirement is lowered from $1 million to $500,000.

What is a Targeted Employment Area? (TEA?)

A targeted employment area is considered either a rural area or a location that has high-unemployment. An EB-5 investor will designate the preferred TEA on the immigrant investor's FORM I-526.

A rural area is one that is outside a metropolitan statistical area as designated by the Office of Management and Budget. As determined through the U.S. Census, it also must not be on the outskirts any town or city with a population of 20,000 or more.

To receive designation as a location with high-unemployment, the area must be experiencing unemployment of at least 150% of the national average rate. The high unemployment must also be in an area with a residential population of 20,000 or more.

Regional center investment:

If you decide that you would like to invest in a regional center, the regional center will notify you if their projects are located in TEAs. A regional center may be a great option for investors looking for a less hands on investment. Regional centers offer limited partnerships to EB-5 investors. While EB-5 investors must do their due diligence when choosing a regional center, a regional center provides them a fantastic option if they're less interested in doing all the daily tasks involved in commercial enterprise investment.

How to receive TEA designation from state agencies:

It may be necessary for a targeted employment area to be certified by a state governing body if the EB-5 applicant invests $500,000 or more capital, but less than $1 million. If the EB-5 applicant invests $1 million or more capital, TEA designation by a state agency may not be necessary.

TEA designation is adjudicated on the I-526 application. The EB-5 investor must provide evidence that the project is in a confirmed TEA. The investor should provide sufficient statistical documentation to prove their project will be in a TEA.

Many times, investors are misinformed on what qualifies as a TEA.

You can contact the U.S. Bureau of Labor Statistic's Local Area Unemployment Statistics (LAUS) office and obtain published data. You could also request a letter from a state body to provide evidence that a certain small area is rural or has high-unemployment.

USCIS requires that this evidence for the TEA be submitted to them. The investor must prove that the TEA, in which they want to invest their commercial enterprise, is in a location that has an unemployment rate is at least 150% of the national average.

A state governing body can also designate a TEA by providing a letter with evidence that the location of the proposed commercial enterprise would be in a high unemployment area.

A lot of states provide a list of certified target employment areas on their government websites.