City of Dallas Regional Center program trades green cards for development capital
By RUDOLPH BUSH / The Dallas Morning News
In Dallas, like in so many parts of the country, cash for big-time development deals has all but dried up.
But City Hall thinks it has found a new money tree that backers hope will bloom, in time, with hundreds of millions of dollars in foreign investment.
After years of trips to China and other parts of the Far East, council member Ron Natinsky and city staff have crafted what they expect will be a powerful new development tool that could help fund the redevelopment of downtown and poorer areas of Dallas.
The program – known as the City of Dallas Regional Center – is a citywide adoption of a federal immigration program that trades green cards and the promise of permanent residency for investments of $500,000 or $1 million.
According to Natinsky, hundreds of investors – particularly from China but also from Mexico, South America and elsewhere – are lining up for the chance to get in.
“These are not people who are scraping together $500,000 or $1 million. These are people who have a high level of net worth,” he said.
At City Hall, there is hope that the foreign money will be targeted toward some of the city’s hardest development cases, including dilapidated downtown properties such as the Statler Hilton and 500 N. Ervay St.
But it’s also possible the money would go toward building warehouses in southern Dallas or retail centers in the north.
The investment program is complex and governed by strict federal immigration and customs rules that determine who gets in and who’s kept out. The process of clearing investors can take months.
Under the program’s rules, investors who put up $1 million can invest anywhere in Dallas. Investors who put up $500,000 must invest in areas where unemployment is 50 percent higher than the national average.
And every investor’s contribution must create at least 10 permanent jobs. So if 10 investors put up $10 million, their project has to directly or indirectly result in 100 new jobs.
In return, that money would be available to developers here at interest rates well below market – something that can make the difference between a project being viable or not.
Dallas could reap huge benefits from the program, largely because it is believed to be the first city in the country to adopt it on a citywide basis.
“We are ahead of the curve in the sense that few, if any, city governments have taken the initiative and done this,” said Karl Zavitkovsky, director of Dallas’ economic development department.
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EB-5 center OK’d: Company hopes to attract $50M in foreign funds
by Simon Shifrin, Idahobusiness.net
An Idaho company that hopes to plug the gap in financing for startups and other growing businesses in the state has won federal approval to serve as a “regional center” for foreign investment.
Invest Idaho LLC, formerly known as I-Cubed, joins the list of more than 70 centers across the country authorized to channel money from qualified foreign investors into the local economy under the EB-5 visa program.
The company plans to attract $50 million from qualified foreign investors as part of its initial phase, which will be used to set up a fund that could subsidize dozens of projects in any of Idaho’s 44 counties – bringing ideas out of university labs and startup garages, and helping small businesses test new products or markets.
“This really becomes a key – and, I think, historic – economic development milestone for all of Idaho,” said Miles Mahoney, chief executive officer. “Without capital, the great ideas die on the vine. … That’s the ‘valley of death.’ It’s a lack of seed funding. This is bringing $50 million of leverage capital into the state of Idaho.”
Rick Ritter, Invest Idaho’s chief operating officer and CEO of Idaho TechConnect, said too many good ideas in the state are getting bypassed by risk-averse banks and the angel funds and venture capital firms that are looking for massive rates of return as the economy begins to recover.
“None of those guys want to play with the kinds of folks we’re talking about,” he said. “The venture capital guys have moved upstream. Angel guys have moved upstream. It is now a worse problem than it was two years ago. That doesn’t mean we don’t have ideas. In times of economic downturn, we actually have more ideas, but less money than we had before.”
State officials have backed Invest Idaho’s efforts, with the Idaho Department of Commerce helping the company with its application to U.S. Citizenship and Immigration Services – the federal agency that oversees the program – and providing introductions to potential investors through its foreign trade offices.
Gov. C.L. “Butch” Otter has highlighted the EB-5 program as a “key element” of his effort to attract new foreign investment to Idaho as part of Project 60, his plan to grow the state’s annual gross domestic product to $60 billion from $52 billion.
“The value of U.S. residency, and being put on the fast track to citizenship, is an incredible tool to help us attract foreign investment in our Idaho businesses,” he said through a spokesman in response to the center’s creation. “We don’t want to miss this opportunity to infuse our economy with new investment that will stimulate job creation.”
The Department of Commerce says two other Idaho companies that plan to invest in resort development and tourism infrastructure are seeking regional center status. One of the companies has already submitted an application.
Invest Idaho submitted its application in March and received preliminary approval on Sept. 1, though it only confirmed the news to the Idaho Business Review last week.
The EB-5 program was launched under the Immigration Act of 1990. It offers green cards to foreign nationals who invest either $500,000 or $1 million in the United States and create at least 10 jobs within two years.
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Vermont delegation leaving for Asia
By Louis Porter, Vermont Press Bureau, TimesArgus.com
Gov. James Douglas, two other state officials and executives from Vermont businesses leave today for Asia to try and attract foreign business investors to the state.
In exchange for making an investment of $500,000 or more, foreign investors can receive green cards for the U.S., effectively in some cases jumping the line on the visa process. After two years in order to remain in the program, investors must demonstrate the projects have created ten jobs or more and meet other requirements.
Douglas said he doesn’t have a problem with the system of allowing preferential visas for investors, who have brought investment to the Jay Peak and Sugarbush ski resorts and which he hopes will put more money into Vermont firms. Overall immigration law needs to be reformed as well, in part to help farmers in Vermont and elsewhere be able to hire workers, Douglas said.
The program will help fulfill “the need to do everything we possibly can to position Vermont for recovery,” Douglas said.
U.S. Sen. Patrick Leahy of Vermont proposed an extension of the temporary EB-5 visa program, which passed the Senate Tuesday and is on its way to President Barack Obama. Vermont has also just won permission to use the program, which had been restricted to businesses related to tourism, for other firms involved in manufacturing and other work.
“This program has become an economic engine in Vermont, and we have proven it with the creation of hundreds of jobs,” Leahy said in a statement. “I want Vermont to stay on the cutting edge in harnessing these investments for economic development throughout our state. The biggest impediment to this program is its lack of permanence.”
Taxpayers will cover the roughly $5,000-per-person cost of the trip for Douglas, two Agency of Commerce officials and two state troopers. The private business people, including officials from the Vermont Chamber of Commerce, will pay their own way on the two-week trip which will include stops in China, Hong Kong, South Korea and Taiwan.
The governor arranged a previous economic development trip to China in 2007. Douglas and Commerce Secretary Kevin Dorn Tuesday did not point to any specific trade or business dealings produced by that trip, focused on building business for energy and environmental firms.
But Asia is growing in importance as a trading partner for the state, and it is important to have alliances and relationships with companies and officials there, Douglas and Dorn said.
“It is not like doing business in Vermont or in the United States,” said Dorn, who will accompany Douglas on the trip. “You don’t walk into the room and do a deal.”
A half-dozen Vermont companies that have approval or are seeking it for EB-5 investors are accompanying Douglas on the Asia trip. Another half-dozen people from the state who are interested in the possibility but are not applying – yet – to the program are also going along.
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