dismissed EB-3 Case: Construction

identifv;·1P"datadeletedto
preven. '.:,_~c1'Ky unwarranted'
invasionof~ pri~
PUBLICCOrpy'
u.s.Department of Homeland Security
20 Mass. Ave" ·N.W.,Rm. 3000
Washington, DC 20529 .
u.s.Citizenship
and Immigration
Services
FILE:
EAC 03 244 53602
Office: VERMONT SERVICE CENTER Date: N'R ,2 ~ '~... . - .
INRE: Petitioner:
Beneficiary: .
PETITION:. Immigrant petition for Alien Worker as a Skilled Worker or Professional pursuant to
section 203(b)(3) ofthe Immigration and Nationality Act, 8 U.S.C § 1153(b)(3) .
ON BEHALF OF PETITIONER:
t·
, 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. . .'
\ '.
""j
Robert P. Wiemann, Chief
Administra~ive Appeals Office
www.uscis.gov
Page 2
DISCUSSION: The preference visa petition was denied by the Director, Vermont Service Center, and the
Administrativ~ Appeals OffiGe (AAO) dismissed a subsequent appeal. The matter is again b~fore the AAO
on'a motion.to reopen: The motion will be granted, the previous decision.of the AAO'will be affirmed, and the'
petition ~n remained denied. '. ' ..' " .
The petitioner] is a builder. It seeks to employ the beriefiCiaryperm~nently in the United States as a mason.
As ~equired by statute, the petition is accompanied by a Form ETA 750; Application for Alien Employment
,Certification, approved by the U.S. Department ofLabor. The director determined that the petitioner h,ad 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 th~ petition accorqingly. . . '.
'The AAO affirmed the director's decision. The procedural history in this case is documented by the record
~md incorporated into the decision~ Further elaboration' ,of the procedural history will. be made only as
necessary.
As set forth in the dIrector's denial dated April 12,'2004, and, the MO's decision dated October ,20, 2005,
the single issue in this case is whether or not the petitioner has the ability to pay the proffered wage as of the
. priority date and continuing until the beneficiary obtains lawful permanent residence.
v • •
Accompanying the motion, counsel submits a legal' stat~rTIent and copies of the following documents: the
AAO's decision dated October 20,2005; a letter from 2 s accountant dated
November 14, 2005 with exhibits that are examples of financial statements 'for other companies and an
excerpt entitled "From Practitioner's Publishing Company" on the subject of current assets.. . .
The regulation at 8 C.F.R. § 103~5(a)(3) states:
Requirements for motion to reconsider. A mOJion to reconsider must state the reasons for
reconsideration and be supported by any pertinent precedent: decisions to establish that the
decisi~:mwas based on an incorrect application of law ~r [Citizenship and Immigration Services
] The petitioner and the applicant stated on the labor cei:1:ificati~n is ~Artisans Designers 'and Builders with
J j I noted as owner. We accept, and it is a basis of our decision, tha~ ••••.•••••
. trades and does business as Artisans Designers and Builders b~sed up,on statements found in
the record and financial evidence submitted. ' . .
2 While the financial statements were submitted as examples and they were not prepared for the petitioner, we "
note that they are reviewed not al,lditedfinancial statements. The regulation at 8 C.F.R. § 204,s(g)(2) makes
.clear that where a petitioner relies on financial statements .to demonstrate its ability to pay the proffered wage,
those financial statements must be audited. An audit is conducted in accordance with generally accepted
. auditing stanqards to obtain a reasonable assurance that the financial statements of the business are free of
material misst'atel11ents.The accountant's report that accompanied those financial statements makes clear that
they are reviewed statements, as opposed to audited statements. The unaudited finlmcial statements that,
counsel submitted with the motion are not persuasive evidence. Reviews '. are governed by the American
Institute of Certified Public Accountants' Statement on Standards for Accounting and Review Services
(SSARS) No.1., and accountants only express limited assurances in reviews. As the accountant's report
makes clear, the financial statements are the representations of management and the accountant expresses no
opinion pertinent to their accuracy. The unsupported representationsof'management are not reliable evidence
and are insufficient to demonstrate the ability to pay the proffered wage. ' .
",>;
:;'i
(CIS)] policy. A ~otion to ~econsider a decision ~n an application or petition inust, when filed,
also' establishthafthe. decision was incorrect based on the evidence of record: at the time of the
initiarciecision, '
The motion does not qualify as a motion to reconsider because counsel fails to identifY any erroneous
conclusion oflaw 0; ,statementoffact for the appeal, and, he asserts no precedent decisicinsfor any position.
Theregulation at 8 C.F.R. § 103.5(a)(2) states in pertinent part:
Requ,irementsfo; motion to reopen. A motion to reopen must state the new facts to be provided
in the reopened proceedi~g and be supported by affidavits or other documentary evideI?-ce.
The instant motion does q~litYas a motion to 'reopen.·There,are.ne~ facts pre~ented hereby c~unsel that
related to his initial evidence accompanying the petition, or:to the issue of whether or not on the priority date
, "of the alien labor certification application the petitioner had the ability to pay the beneficiary the proffered
'wage. ) . ,
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. § 1153(b)(3)(A)(i),
provides. for the granting of preference classification to qualified immigrants who are,capable, at the time of
petitioning for classification Ulider this, pa~agraph, of perf()rming skilled labor (requiring at least two years
training or experience), not ofa temporary nature, for which qualified workers are not available in the United
States.
The regulation at 8. C.F.R..§ 204.5(g)(2) states in pertinent part:
Ability ofprospective employer to pay wage. "Any petition filed by otfor 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 o(this .ability
shall be in the forin of copies of annual reports, federal tax return~, or audited
financial statements.
The petitioner must demonstrate the continuing ability, to pay' the proffered wage beginning on t1).e 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 ohhe U.S. Department of Labor. See 8 C.F.R. §
204.5(d). The petitioner must also demonstrate that, on the,priority date, the beneficiary had the qualifications
stated on its Form ETA 750 Application for Alien EmploymeritCertification as certified by'the U.S. Department
of Labor and submitted With the instant petition. Matter of Wing's Tea House, 16 I&N Dec. 158 (Act. Reg. '
Coll1rt1.1977). . ,
, . ., . 3 " .' ..,' . ,
Here, the Form ETA 750 was accepted on March 16,2001. The proffered wage as stated on the Form ETA
750 is $21.56 per hour ($44,844.80 per year). The Form ETA 750 states that the position requires two years
of experience in the proffered position. '
, ;t'
3 It has been, approximately six years since theAlienEmpl~yment .Application has been accepted and the
proffered wage established. According.to the employer certification that is part of the application, ETA Form
Page 4
Relevant evidence 'In the record of proceeding includes copies of the following documents: th~ onginal Form
ETA 750, Application for Alien Employment Certification, approved by the U.S; Department of Labor; Form
1099-MISC statements fro~ . (Federal Employer 'Identification
•
N.um.b.e.r,.,,'.'F.EIN," ,j to the beneficiary in his business name that is' ••••••••••
," for 2001, 2002 and 2003;4 a Wage and Tax Statement (W-2) from
Mgmt. Co., Inc'; t for year 2003 as well as his personal tax return for that year; U.S. Internal
Revenue Service Form 1120tax returns for 2001, 2002 and 2003' for '
letters from accountant dated February 5,2004, and May 10,2004 that
has an attachment marked ExhibH A; approximately 11 business checking account statements of the peti~oner
for the period February 1, ·2003 to December 31, 2003; and, copie~'" of documentation concerning the
bene,ficiary's qualifications as well as other documentation.
The evide~ce 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 1978
5
and, at the time the petition was prepared, to
employ five workers. According to the tax rehlrns in the record, the petitioner~s fiscal year is based on a
calendar year. On the Form ETA 750B, signed by the beneficiary on March 9, 2001, the beneficiary did not
claim to have worked for the petitioner, although' the beneficiary has worked for t~e 'petitioner as,'an
independent contractor in 2001 and 2002. '
on motion dated November 18, 2005, counsel 'asserts that the director should have considered "loans
receivable-shareholder in its calculations of net current assets:" Counsel contends that the "excess corporate
earnings" taken by t~e sole shareholder of the petitioner are evidence of theability to paY,the proffered wage.
Counsel asserts that the amounts received by the beneficiary as an independent contractor. together with
officer's compensation are evidence of the ability to pay the proffereq wage. Further, counsel states that the
fact that the petitioner has not paid the beneficiary the proffered wage in any year fOf which evidence h~s
been submitted is not eVidence, and according to counsel "does not impact," the petitioner's ability to pay the
proffered wage. '
The petitioner must establish that its job offer to the beneficiary is a realistic one. Because the ,filing of an
ETA 750 labor certification ,application establishes a priority date for any immigrant petition later based on
, the ETA 750, the petitioner must establish that the job offer was realistic as of the priority date and that the
offer remained realistic for each year thereafter, until the beneficiary obtains lawful permanent re~idence. The
petitioner's ability to pay the proffered wage is an essential element in evaluating whether a job offer is
realistic. See Matter of Great, Wall,16 I&N, Dec. 142 (Acting Reg. Comm. 1977). See also 8 CFR
§ 204.5(g)(2). In evaluating whether a job offer is realistic, CIS requires the petitioner to,demonstratefinancial
resources sufficient to pay the beneficiary's proffeted wages, although the totality of the circumstances affecting., . .
the petitioning business will be considered if the evidence warrants such consideration. See Matter ofSonegawa,
12 I&N Dec. 612 (BIA 1967). ' ' '
,/ "
750 Part A, Section 23 b., states "The wage offered equals or exceeds, the prevailing wage and I [the
employer] guarantee that; if a labor certification is granted, thl;': wage paid to the alien when the alien begins
work will equal or exceed the prevailing wage which is applicable at the time the alien begins work."
4 The FEIN number is obscured for privacy purposes: There is also a Form 1099-MISCsubmitted for 2000
but since it was issued prior, to the priority date,' it has no value as independent, ,objective evidence of the
petitioner's ability to pay the proffered wage from the priority date of March 16, 2001.
5 According to the tax returns s).lbmitted" Inc. was incorporated in 1984.
Page 5
, ' .
In,deterrriinihg the petitio~er' s ability to pay the proffered w~ge during ~ given period, CIS will first examine
whether the petitioner employed and paid the be~eficiary dufihg that period. C~unsei.states.on 'appeal that the
fact that the petitioner has not paid the beneficiary the proffered wage in any year for which evidence has
been ,submitted is not evidence, and according to counsel ,"does not impact," thepetltioner's ability to pay the
proffered wage. 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. Form 1099-MISC statements were submitted irito evidence
from Co., Inc. to the beneficiary in his business name'; , ) d/b/a
for 2001, 2002 and 2003. The Form 1099-MISC statements state compensation in. the
amounts of $18,880.00, $20,513.00 and $6,631.28 respectively for those years. In the instant case, the
petitioner has not established that it employed and paid the beneficiary the full proffered wage of $44,844.80
per 'year from the priority date.. It would have to demonstrate that it 'is able to pay the difference between
, wa,gespaid and the proffered ~age. '
If the petitioner does not establish that it employed and p~id 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 pI:offered wage is well
established byjudicial precedent. Elatos Restaurant Corp. y. Sava, 632 F:Supp. 1049, 1054 (S.D.N.Y. ~986)
(citing Torigatapu Woodcraft Hawaii, Ltd. v. Feldman, 7~6F.2d 1305 (9th Cir. 1984)); 'see also Chi-Feng
Chcmgv. 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. Pcibrier, 539 F.Supp. 647 (N.D~ IlL 1982), afj'd,703 F.2d ,571 (7th Cir. 1983).
Reliance, on the petitioner's gross sales and profits exceeded the proffered wage is misplaced. Showing that
the petitioner's gross sales and profits exceeded the proffered wage is insufficient. Similarly, showing that
, "the petitioner paid wages in excess of the proffered wage'is insufficient.
In K. c.P. Food Co., Inc. v. Sava, the court held that the Immigration ~nd naturalization service, now CIS, had
properly relied on the petitioner!s net income figure, as stated on the petitioner's corporate income tax returns,
rather than the petitioner's gross income. Id. at 1084. The court specifically rejected the argument that the
Service should have considered income before expenses ,were paid'rather than net income. The court in, Chi-
Feng Chang further noted: ,,'
Plaintiffs also contend that depreciation amounts on the 1985 and 1986 returns are
non-cash deductions. Plaintiffs thus request that the court sua sponte add back to net
cash the depreciation expense charged for the year. Plaintiffs cite no legal authority
for this proposition. This argument has likewise been presented before arid rejected. '
See Elatos, 632 F. Supp. at 1054. [CIS] and judicial. precedent support the use of tax
returns ancf the; net income figures in determining petitioner's ability to pay.
Plaintiffs' argument that these figures should be revised by the c9urt by adding'back
depreciation is without support. ' ' ,
(Emphasis in originaL) Chi-Feng at 537.
The tax returns demonstrate the following financial information concerning the petjtioner's ability to pay:
p,age 6
" , ' 6
• In 2001, the Form 1120 stated net income of$O.OO.
• ' In 2002, the Form 1120 stated net income of $0.00.
• In 2003, the Form 1120 stated net income of$O.OO.'
, ., . .
Since the proffered wage is $44,844'.80 per year, the petitioner did not have the ability to pay the proffered
wage from an examination of its net income for years 2001, 2002 and 2003; or the difference between
~ompensationaCtually paid and th~ proffered wage for those years.
If the net income the petitioner demonstrates it had available during the 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. The petitloner'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
busines's 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. Rather, CIS will consider net current
, assets as an alternative method of demonstrating the abil,ityto pay the proffered wage. '
Net currerit assets are the difference between the petitioner's current assets and current liabilities.7 A
corporation's year-end current assets are shown on Schedule L, lines 1 through 6 and include cash-on.;.hand.
Its year-end current liabiliti~~ 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's net current assets during 2001, 2002, and 2003 were
<$348,394.00>,8<$55:5,321.()0>, and <$414,859.00> respectively.
. Therefore, for the years examined, the petitioner did not have sufficient net current assets to pay the proffered
wage."
, Therefore, from the date the Form, ETA 750 was accepted for proce.ssing 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 or compensation paid to the. beneficiary, or its net
income or net current assets. '
Counsel asserts that the director should have considered' "loans receivable-shareholder" in its calculations of
net current assets." "Loans receivable-shareholder" has not been identitledby counsel with reference to the
tax returns. The financial statements containing this item are for other companies and are not relevant to the
6 IRS Form 1120, Line 28 that states the petitioner's taxable income before net operating loss deduction and
special deductions, will be referred to as net income in these proceedings.
7 According to Barron's Dictionary ofAccounting Terms 117 (3Td ed. 2000), "current assets" consist of items
haying (in most cases) a life of orie year or less, such as cash, marketable securities, inventory and prepaid
expenses. "Current liabilities?' are obligations payable (in most cases) within one year, such as accounts
, payable, short-term notes payable, and accrued expenses (such as taxes and salaries). Id. at 118.
8 The symbols <a number> indicate ,a negative number, or in the context of a tax return or other financial
, statement, a loss., "
Page 7
data in the petitioner's tax returns. Current assets are shown on Schedule L, lines 1 through 6 and include
cash-on-hand, and, c'urrentliabilities are shown on lines 16 through 18. "Loans receivable-shareholder" is not
one of the current assets line items. Further, if the petitioner wishes to rely on loans receiyable-shareholder 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 loans receivable-shareholder will augment and not
weaken its overall financial position.. Finally, CIS will give less weight.toloans 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 debt is 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). The petitioner has failed to submit a detailed business plan and audited cash flow statements
to support the contentions that'loims.receivable-shareholder are assets apd evidence of the ability to pay the
proffered wage. . .
Counsel asserts that officer's cOlnpensation is evidence of the abiiity to pay the proffered wage.' A
review of the record demonstrates that this assertion is counsel's statement not the petitioner's
statemene While the petitioner has received substantiation compensation on a yearly basis, there is '
no indication whatsoever that he 'would be willing' or able to forego any portion of the officer's
compensation.he received. The unsupported statements' of counsel on appeal or in a motion are not
evidence and thus are not entitled to any evidentiary weight. See INS v. Phinpathya, 464 U.S. 183,
188-89 n.6 (1984); Matter ofRamirez-Sanchez, 17 i&N Dec .. 503 (BIA, 1980). CIS m~y not;'pietce
the corporate veil" and look to the assets of the' corporation's owner to satisfy the corporatiOIi's
ability top'ay the proffered wage. It is an elementary rule that a corporation is a separate and distinct
legal entity from its owners and shareholders. See Matter ofM, 8 I&N Dec. 24 (BIA 1958), Matter
ofAphrodite Investments, Ltd., 17 I&N Dec. 530 (Comm. 1980), and Meitter of Tessel, 17 I&N Dec.
631 (Act. Assoc. Comm. 1980). Consequently, assets of its shareholders or of other enterprises or'
corporations cannot be considered in determining the petitioning corporation's ability to pay the
proffered wage .. In a similar case, the court in Sitar v. Ashcroft, 2003 WL 22203713 (D.Mass. Sept.
18, 2003) stated, "nothing in the governing regulation, 8 C.F.R.'§ 204.5, permits [CIS] to consider
the financial resources of individuals or entities who have no legal obligation to pay the wage."
." ..'. '
Counsel has submitted a statement from petitioner's accountant dated November 14,2005, that asserts in part
that the petitioner's earnings are deferred "until the job is totally complete." The.accountant stated in. the
letter that this and other accounting practices utilized reduced the gross profits of the petitioner. The amounts
shown on the petitioner's tax returns shall be considered as they were submitted to IRS, not as amended
pursuant to the accountant's adjustments. If the accountant wished to persuade this office that other methods
ofaccounting supports the petitioners continuing ability to pay the proffered wage beginning on the priority
.. date, then the accountant was obliged to prepare and submit audited financial statements pertinent to the
petitioning business prepared according to generally accepted accounting principles. Furthermore, a
petitioner must establish eligibility at the time .offiling; a petition cannot be approved at.a future date after the
,9. For example a signed and notarized declaration by the officer(s).. ,Going on record without supporting
clocumentary evidence is not sufficient for purposes of meeting the burden of proof in these proceedings.
Matter of Sofjici, 22 I&N Dec. 158, 165 (Comm. 1998) (citing Matter of Treasure Craft ofCalifornja, 14
I&N Dec. 190 (Reg. Comm. 1972».' .
'. :
Page 8.
petitione~or beneficiary becomes eligible under a new set of facts. Matter ofKatigbak, 14 I&N Dec·. 45, 49 .
(Comm.1971).·· . '.
. The evidence 'submitted fails to establish that the petitioner has tht;: continuing ability to pay the. proffered
wage beginning on the priority dat~. . . ... ..
The bunlen of proof in these proceedings rests solely with the petitioner. . Section 291 of tli.~ A<:.t,.8 U.S.C.
§ 136L The petitioner has not metthat burden. . ... .. .
", . .' .
, ..'
ORDER: The motion will be granted, the previous decision ofthe AAO is affirmed, an,d the petition will
remain denIed.
.'" ..