dismissed EB-3 Case: Accounting

dentiffing data deleted to 
prevent cIeas!y unwarranted 
invasion of personal privacy 
PUBLIC COPY 
U.S. Department of Homeland Security 
20 Mass. Ave., N.W., Rrn. A3042 
Washington, DC 20529 
U. S. Citizenship 
and Immigration -, 
.,$ . 
tz & 
FILE: WAC 04 141 53407 Office: CALIFORNIA SERVICE CENTER 
 Date: 2 1 2006 
PETITION: Immigrant petition for Alien Worker as a Skilled Worker or Professional pursuant to section 
203(b)(3) of the Immigration and Nationality Act, 8 U.S.C. § 1 153(b)(3) 
ON BEHALF OF PETITIONER: 
INSTRUCTIONS: 
This is the decision of the Administrative Appeals Office in your case. All documents have been returned to 
the office that originally decided your case. Any further inquiry must be made to that office. 
~o6e1-t P. Wiemann, Director 
Administrative Appeals Office 
WAC 04 141 53407 
Page 2 
DISCUSSION: The preference visa petition was denied by the Director, California Service Center, and is 
now before the Administrative Appeals Office (AAO) on appeal. The appeal will be dismissed. 
The petitioner is a reprographicstdigital printing company. It seeks to employ the beneficiary permanently in 
the United States as an accountant. As required by statute, a Form ETA 750, Application for Alien 
Employment Certification, approved by the Department of Labor, accompanies the petition. The director 
determined that the petitioner had not established that it had the continuing ability to pay the beneficiary the 
proffered wage beginning on the priority date of the visa petition. The director denied the petition 
accordingly. 
On appeal, counsel submits: 
Abrief; 
A transcript of a panel discussion at the 2004 American Immigration Lawyers Association (AKA) 
Annual Conference in Philadelphia, including William Yates, Associate Director, Operations, 
Citizenship and Immigration Service (CIS). 
The regulation 8 C.F.R. tj 204.5(g)(2) states in pertinent part: 
Ability of prospective employer to pay wage. 
 Any petition filed by or for an employment-based 
immigrant which requires an offer of employment must be accompanied by evidence that the 
prospective United States employer has the ability to pay the proffered wage. The petitioner must 
demonstrate this ability at the time the priority date is established and continuing until the beneficiary 
obtains lawful permanent residence. Evidence of this ability shall be in the form of copies of annual 
reports, federal tax returns, or audited financial statements. 
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the priority 
date, which is the date the Form ETA 750 Application for Alien Employment Certification, was accepted for 
processing by any office within the employment system of the U.S. Department of Labor. See 8 CFR 
204.5(d). 
Here, the Form ETA 750 was accepted on October 19,2001. The proffered wage as stated on the Form ETA 
750 is $29.20 per hour ($60,736 per year). 
The evidence in the record of proceeding shows that the petitioner is structured as a C corporation. On the 
petition, the petitioner claimed to have been established in March 1996, to have a gross annual income of 
$300,000, and to currently employ six workers. According to the tax returns in the record, the petitioner's 
fiscal years lasts from January 1 to December 31. On the Form ETA 750B, signed by the beneficiary on 
January 12, 200 1, the beneficiary claimed to have worked for the petitioner since June 200 1. 
With the petition, the petitioner submitted the following documents: 
The original approved ETA 750; 
Counsel's G-28; and, 
The petitioner's Form 1 120 for 2001 and 2002. 
On July 15, 2004, the director issued a Notice Of Intent To Deny, requesting additional evidence pertinent to 
the petitioner's ability to pay the proffered wage within 30 day or the director will deny the petition. 
WAC 04 141 53407 
Page 3 
In response, counsel asserted that the petitioner's submitted tax returns show its assets exceed the proffered 
wage; that in 200 1, it paid salaries of $1 17,63 1, and in 2002, it paid salaries of $152,663; and that it has a line 
of credit with Sumitomo bank. 
The director denied the petition on September 29, 2004, finding that the evidence submitted with the petition 
did not establish that the petitioner had the continuing ability to pay the proffered wage beginning on the 
priority date. 
On appeal, counsel asserts that the law does not mandate that a petitioner must show it has the ability to pay 
the proffered wage, and CIS lacks the authority to impose that requirement by regulation. Further, CIS has 
adopted regulations that have no real basis in accounting or finance, particularly the requirement of a positive 
net income or net assets in the first years of a petitioner's existence. Further, counsel challenges director's 
rejection of the petitioner's line of credit as evidence of its ability to pay the proffered wage. Finally, counsel 
asserts that the director erred in finding that the beneficiary was not working for the petitioner in 2001 or 
2002. 
In determining the petitioner's ability to pay the proffered wage during a given period, Citizenship and 
Immigration Services (CIS) will first examine whether the petitioner employed and paid the beneficiary 
during that period. If the petitioner establishes by documentary evidence that it employed the beneficiary at a 
salary equal to or greater than the proffered wage, the evidence will be considered prima facie proof of the 
petitioner's ability to pay the proffered wage. In the instant case, the beneficiary stated on the ETA 750 that 
she was working for the petitioner. However, the petitioner has not established that it paid the beneficiary the 
full proffered wage during the period from the priority date through 2002. There is no evidence in the record 
of proceedings (W-2s, Form 1099 MISC, etc.) showing the amount of compensation. 
If the petitioner does not establish that it employed and paid the beneficiary an amount at least equal to the 
proffered wage during that period, CIS will next examine the net income figure reflected on the petitioner's 
federal income tax return, without consideration of depreciation or other expenses. Reliance on federal 
income tax returns as a basis for determining a petitioner's ability to pay the proffered wage is well 
established by judicial precedent. Elatos Restaurant Corp. v. Sava, 632 F. Supp. 1049, 1054 (S.D.N.Y. 1986) 
(citing Tongatapu Woodcraft Hawaii, Ltd. v. Feldman, 736 F.2d 1305 (9th Cir. 1984)); see also Chi-Feng 
Chang v. Thornburgh, 719 F. Supp. 532 (N.D. Texas 1989); K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. 1080 
(S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. Supp. 647 (N.D. 111. 1982), aff'd, 703 F.2d 571 (7th Cir. 1983). 
The tax returns demonstrate the following financial information concerning the petitioner's ability to pay the 
proffered wage of $60,736 per year from the priority date. 
In 2002, the Form 1120 stated net income' of -$54,635. 
In 2001, the Form 1 120 stated net income of -$65,126. 
Therefore, for the years 2001 and 2002, the petitioner did not have sufficient net income to pay the proffered 
wage. 
If the net income the petitioner demonstrates it had available during that period, if any, added to the wages 
paid to the beneficiary during the period, if any, do not equal the amount of the proffered wage or more, CIS 
will review the petitioner's assets. We reject, however, the idea the petitioner's total assets should have been 
I 
 Taxable income before net operating loss deduction and special deductions as reported on Line 28. 
WAC 04 141 53407 
Page 4 
considered in the determination of the ability to pay the proffered wage. The petitioner's total assets include 
depreciable assets that the petitioner uses in its business. Those depreciable assets will not be converted to 
cash during the ordinary course of business and will not, therefore, become funds available to pay the 
proffered wage. Further, the petitioner's total assets must be balanced by the petitioner's liabilities. 
Otherwise, they cannot properly be considered in the determination of the petitioner's ability to pay the 
proffered wage. CIS will consider net current assets as an alternative method demonstrating the ability to pay 
the proffered wage. 
Net current assets are the difference between the petitioner's current assets and current liabilities.* 
 A 
corporation's year-end current assets are shown on Schedule L, lines 1 through 6. Its year-end current 
liabilities are shown on lines 16 through 18. If the total of a corporation's end-of-year net current assets and 
the wages paid to the beneficiary (if any) are equal to or greater than the proffered wage, the petitioner is 
expected to be able to pay the proffered wage using those net current assets. The petitioner had $10,349 net 
current assets for the year 2001, and for the year 2002, had -$54,635. 
Counsel asserts in his brief accompanying the appeal that there is another way to determine the petitioner's 
ability to pay the proffered wage from the priority date. Counsel states that the petitioner's proof of a line of 
credit evidenced its ability to pay the proffered wage. In calculating the ability to pay the proffered salary, 
CIS will not augment the petitioner's net income or net current assets by adding in the corporation's credit 
limits, bank lines, or lines of credit. A "bank line" or "line of credit" is a bank's unenforceable commitment 
to make loans to a particular borrower up to a specified maximum during a specified time period. A line of 
credit is not a contractual or legal obligation on the part of the bank. See Barron's Dictionary of Finance and 
investment Terms, 45 (1998). 
Since the line of credit is a "commitment to loan" and not an existent loan, the beneficiary has not established 
that the unused funds from the line of credit are available at the time of filing the petition. As noted above, a 
petitioner must establish eligibility at the time of filing; a petition cannot be approved at a future date after the 
petitioner becomes eligible under a new set of facts. See Matter ofKatigbak, 14 I&N Dec. 45, 49 (Comm. 
1971). Moreover, the petitioner's existent loans will be reflected in the balance sheet provided in the tax 
return or audited financial statement and will be fully considered in the evaluation of the corporation's net 
current assets. 
Comparable to the limit on a credit card, the line of credit cannot be treated as cash or as a cash asset. 
However, if the petitioner wishes to rely on a line of credit as evidence of ability to pay, the petitioner must 
submit documentary evidence, such as a detailed business plan and audited cash flow statements, to 
demonstrate that the line of credit will augment and not weaken its overall financial position. Finally, CIS 
will give less weight to loans and debt as a means of paying salary since the debts will increase the firm's 
liabilities and will not improve its overall financial position. Although lines of credit and debt are an integral 
part of any business operation, CIS must evaluate the overall financial position of a petitioner to determine 
whether the employer is making a realistic job offer and has the overall financial ability to satisfy the 
proffered wage. See Matter of Great Wall, 16 I&N Dec. 142 (Acting Reg. Comm. 1977). 
Further, counsel asserts that CIS has overstepped its authority by issuing regulations concerning the evidence 
needed to show the ability to pay the proffered wage. However, the regulations have been promulgated 
2 
 According to Burron's Dictionary of Accounting Terms 117 (3rd ed. 2000), "current assets" consist of items having (in 
most cases) a life of one year or less, such as cash, marketable securities, inventory and prepaid expenses. "Current 
liabilities" are obligations payable (in most cases) within one year, such accounts payable, short-term notes payable, and 
accrued expenses (such as taxes and salaries). Id. at 11 8. 
WAC 04 141 53407 
Page 5 
consistent with the requirements of the Administrative Procedures Act. The AAO must follow the law and 
regulations. Further, case law has consistently acknowledged AAO's ability to review an employer's ability 
to pay. See, as examples, Elatos Restaurant Corp. v. Sava, 632 F. Supp. 1049, 1054 (S.D.N.Y. 1986) (citing 
Tongatapu Woodcraft Hawaii, Ltd. v. Feldman, 736 F.2d 1305 (9th Cir. 1984)); see also Chi-Feng Chang v. 
Thornburgh, 719 F. Supp. 532 (N.D. Texas 1989); K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. 1080 
(S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. Supp. 647 (N.D. Ill. 1982), aff d, 703 F.2d 571 (7th Cir. 1983). 
Therefore, fiom the date the Form ETA 750 was accepted for processing by the U. S. Department of Labor, 
the petitioner had not established that it had the continuing ability to pay the beneficiary the proffered wage as 
of the priority date through an examination of wages paid to the beneficiary, or its net income or net current 
assets. 
The evidence submitted does not establish that the petitioner had the continuing ability to pay the proffered 
wage beginning on the priority date. 
The burden of proof in these proceedings rests solely with the petitioner. Section 291 of the Act, 8 U.S.C. 
3 1361. The petitioner has not met that burden. 
ORDER: The appeal is dismissed.