TEA drama on the 6/30 call

We know about recent cases in which USCIS has questioned state-designated TEAs, specifically designation of individual census tracts and groups of census tracts. And we were curious to see how they’d explain that in the 6/30 EB-5 Stakeholder’s Meeting. Here’s what went down. (With time references to my MP3 recording of the second half the meeting, as posted below.)

[minute 29]  Kevin Cummings of the Office of Policy and Strategy acknowledged current frustrations regarding inconsistency and unpredictability in TEA designations. “We’re examining a couple of different options in this regard, things we can do to make the TEA designation more predictable. But it’s something we’ll probably have to discuss at a senior level. And I expect that we’ll probably be able to discuss that with our senior leadership during the month of July.”

[minute 45] Q:Can my state give me a designation of a TEA area per their calculations?
Kim Atteberry: I would suggest that it should be a reasonable, transparent, and reproduceable methodology.

[minute 48] Q: The 2009 memo talks about USCIS not having the authority to question the governor’s designation of TEA status, but then within just a couple of lines it implies that USCIS does have that authority. So I’d like to get an answer if possible about whether USCIS has and can question a governor’s designation of a TEA.
Kevin Cummings: Like I said earlier, we are examining the TEA issues and that is one of the aspects that we’re taking a real close look at right now. So I’m not prepared to further comment on that right now at this time. But hopefully we will, um, resolve some of these issues within the next several weeks.
Q: Okay, has USCIS questioned, has USCIS overturned something in the past when there was a designation by the governor’s office?
[silence...whisper whisper whisper... silence]
Mary Herman: Sorry Sir, we’re just consulting.
Kevin Cummings: No, I mean you just have to look at the existing regulations at this time, and the TEA designations do have to be supported by valid methodologies. Um… so… I mean that’s all I can tell you on that at this point.
Q: Uh, okay, thank you.

[minute 50] Q: Regarding TEAs, are you seeing any trends toward using census block groups as qualifying political subdivisions?
[silence]
Sasha Haskell: A census tract or a grouping of census tracts is not a political subdivision. The only means by which a grouping of census tracts could qualify would be as a geographic area.
[silence]
Q: Okay, but my question was about block groups.
Kim Atteberry: Block groups are also just geographic designations, not political.
Q: So there’s neither bias for nor against using block groups?
[silence]
Kim Atteberry: Uh, I don’t think so. I think so long as you know, sound data is supported by you know transparent reasonable methodologies, then, no, that they’re just simply a grouping of census tracts.
Q: Well thank you very much.

[minute 55] Q: A quick follow-up to the discussion that was just had about census tracts. And I just want to be clear about this. So if the governor of a state designates a single census tract as a high unemployment area and that represents the most current data available — let’s say by BEA — that is or is not recognized by USCIS.
Kim Atteberry: I assume that it would be based on the appropriate BLS methodologies, etc. etc.
Q: Yup. It’s 2010 annual data. So it’s the most currently available.
Kim Atteberry: Yeah, I mean, I can’t see why… I mean… as long as methodology is there and you can see what’s going on, I don’t see why that would be a problem.
Q: I only ask because I thought that I heard that someone said that a census tract is neither a legal nor a political boundary.
Sasha Haskell: It is not. A political boundary. A census tract may qualify as being a geographic area but it is not, it doesn’t meet the definition of a political subdivision.
Q: So then we’re qualifying a single census tract under which of these two prongs? It’s either a legal boundary or a geopolitical subdivision?
Sasha Haskell: Well I would look at the regulations…
Q: Hahaha… It says “a single…legal or geo-”– I don’t have it in front of me — all I’m asking is does a census tract qualify for one of those two, if the state says “we designate a high unemployment area.”
[long pause]
Sasha Haskell: Yes, it probably would.
Q: Hahaha…
Sasha Haskell: You know, without seeing specifically what you’re talking about…
Q: This is a single census tract! That’s a period. It’s not like there’s a lot of ambiguity to it–
Mary Herman: Next question–
Q: We’re worried about aggregating or gerrymandering, but we’ve drilled it down to a single census tract–
Sasha Haskell: We’re not talking about gerrymandering. We’re talking about has the state followed the guidelines that are laid down in 204.6(5) by providing the methodology, and if the methodology is in keeping with what our memo says, then most likely if that is followed it would be qualifying. I really don’t know what to say beyond that.
Mary Herman: Thank you Sasha and thank you for your question David. Can we move on to the next question please…

1/12/2012 Update: the question of whether a census tract per se is an acceptable building block for a TEA was asked again at the 1/12 Conversation with Director Mayorkas, and did not receive a definitive answer. Director Mayorkas said that he would discuss with his team whether a single census tract or census tract group qualifies as a geographic area or political subdivision for TEA designation purposes.
I’m interested to note that no one refers to the Adjudicators Field Manual, which offers fairly clear guidance for what’s acceptable and specifically addresses the issue of right to question a state designation.

Adjudicator’s Field Manual Chapter 22.4(2)(F)(iii)

State Designation of a High Unemployment Area.

The state government of any state of the United States may designate a particular geographic area or political subdivision located within a metropolitan statistical area or within a city or town having a population of 20,000 or more within such a state as an area of high unemployment.

Before any such designation is made, an official of the state must notify USCIS of the agency, board, or other appropriate governmental body of the state which shall be delegated the authority to certify that the geographic or political subdivision is a high unemployment area.

Evidence of such a designation, including a description of the boundaries of the geographic or political subdivision and the method or methods by which the unemployment statistics were obtained, may be submitted in support of the Form I-526 petition in lieu of other documentary evidence of high unemployment in the area where the new commercial enterprise is located. See 8 CFR 204.6(i) . The statistics used in the analysis must reflect the national and local unemployment rates for these regions at the time of the alien investor’s capital investment. See 8 CFR 204.6(e).

The designation of high unemployment areas are within the purview of each U.S. state governor, or if applicable, his or her designee. USCIS personnel have no substantive authority to question or challenge such high unemployment designations, and therefore must rely on the high unemployment designations that conform to the requirements outlined above that are made by a U.S. state governor or his or her designee.

ISOs should notify the CSC EB-5 program manager and seek guidance regarding how to address the TEA issue in petitions that contains a state designation letter that does not conform to the requirements of 8 CFR 204.6(i) , utilizes statistics that do not reflect the national and local unemployment rates at the time of the alien investor’s capital investment, or has been issued by an official of a state that has not notified USCIS regarding who in the state government has the authority to issue such designations.

Note
State designations of high unemployment areas also include designations issued by the appointed government body with authority to make such certifications by the governors of the U.S. territories or the mayor of the District of Columbia.