dismissed EB-3 Case: Culinary

dentifjhg date deleted to 
pmvent dearly unwarranted 
invasion of personal privacy 
U.S. Department of Homeland Security 
20 Mass. Ave., N.W., Rm. A3042 
Washington, DC 20529 
U. S. Citizenship 
and Immigration 
Services 
 R I 
FILE: EAC 02 140 52693 Office: VERMONT SERVICE CENTER Date: my 1 2 200~ 
IN RE: 
PETITION: 
 Immigrant Petition for Alien Worker as a Skilled Worker or Professional Pursuant to 
Section 203(b) of the Immigration and Nationality Act, 8 U.S.C. 
 1153(b) 
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. 
/L 
mu 
Robert P. Wiemann, Chief 
Administrative Appeals Office 
EAC 02 140 52693 
Page 2 
DISCUSSION: The preference visa petition was denied by the Director, Vermont Service Center, and is 
now before the Administrative Appeals Office (AAO) on appeal. The appeal will be dismissed. 
The petitioner is a restaurant. It seeks to employ the beneficiary permanently in the United States as a 
specialty foreign food cook. As required by statute, a Form ETA 750, Application for Alien Employment 
Certification approved by the Department of Labor, accompanied 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 and denied the petition accordingly. 
The record shows that the appeal is properly filed, timely and makes a specific allegation of error in law or fact. 
The procedural history in this case is documented by the record and incorporated into thts decision. Further 
elaboration of the procedural history will be made only as necessary. 
As set forth in the director's June 10, 2004 denial, 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. 
Section 203(b)(3)(A)(i) of the Act, 8 U.S.C. 5 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 under this 
paragraph, of performing skilled labor (requiring at least two years training or experience), not of a temporary 
or seasonal nature, for which qualified workers are not available in the United States. 
The regulation at 8 C.F.R. 9 204.5(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. In a case where the prospective United States employer employs 100 or more 
workers, the director may accept a statement from a financial officer of the organization 
which establishes the prospective employer's ability to pay the proffered wage. In 
appropriate cases, additional evidence, such as profit/loss statements, bank account records, 
or personnel records, may be submitted by the petitioner or requested by [Citizenship and 
Immigration Services (CIS)]. 
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 was accepted for processing by any office within the employment 
system of the Department of Labor. See 8 CFR tj 204.5(d). The priority date in the instant petition is January 
20, 1998. The proffered wage as stated on the Form ETA 750 is $17.61 per hour or $36,628.80 annually. 
The AAO takes a de novo look at issues raised in the denial of ths petition. See Dor v. INS, 891 F.2d 997, 1002 
n. 9 (2d Cir. 1989)(noting that the AAO reviews appeals on a de novo basis). The AAO considers all pertinent 
evidence in the record, including new evidence properly submitted upon appeal1. Relevant evidence submitted on 
I 
 The submission of additional evidence on appeal is allowed by the instructions to the Form I-290B, which 
are incorporated into the regulations by the regulation at 8 C.F.R. 5 103.2(a)(l). The record in the instant case 
provides no reason to preclude consideration of any of the documents newly submitted on appeal. See Matter 
of Soriano, 19 I&N Dec. 764 (BIA 1988). 
EAC 02 140 52693 
Page 3 
appeal includes a letter from North Fork Bank showing a line of credit account of $5 1,000 and a loan account of 
$50,000, a promissory note from The Bridgehampton National Bank for $50 000 a romissory note from the 
Bridgehampton National Bank for $100,000, a copy of a statement from 
Y 
xplaining that he had 
loaned the petitioner $20,000 in 1998, and copies of the petitioner's 199 
 1 Forms 1120S, U.S. 
Income Tax Returns for an S Corporation. 
 Other relevant evidence in the record includes copies of the 
petitioner's 1997 and 1999 Forms 1 120S, and copies of the beneficiary's 1998 through 2002 Forms W-2, Wage 
and Tax Statements. The petitioner's 1997 through 2001 tax returns reflect ordinary incomes or net incomes of 
$15,2 19, $4,78 1, $16,495, -$7,437, and -$49,975, respectively. The petitioner's 1997 through 200 1 tax returns 
also reflect net current assets of -$18,679, -$8,597, $7,902, -$23,266, and -$105,835, respectively. The 
beneficiary's 1998 through 2002 Forms W-2 issued by the petitioner reflect wages of $1 1,700, $18,400, $20,800, 
$20,800, and $25,600, respectively. The record does not contain any other evidence relevant to the petitioner's 
ability to pay the proffered wage. 
On appeal, counsel states that the petitioner has established its ability to pay the proffered wage of $36,628.80 
based on its lines of credit, its depreciation, and its cash on hand. 
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 residence. 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 C.F.R. 204.5(g)(2). In 
evaluating whether a job offer is realistic, CIS requires the petitioner to demonstrate financial resources sufficient 
to pay the beneficiary's proffered wages, although the totality of the circumstances affecting the petitioning 
business will be considered if the evidence warrants such consideration. See Matter of Sonegawa, 12 I&N Dec. 
612 (Reg. Comm. 1967). 
In determining the petitioner's ability to pay the proffered wage, CIS will first examine whether the petitioner 
employed the beneficiary at the time the priority date was established. If the petitioner establishes by 
documentary evidence that it employed the beneficiary at a salary equal to or greater than the proffered wage, 
this evidence will be consideredprimafacie proof of the petitioner's ability to pay the proffered wage. In the 
instant case, on the Form ETA 750B, signed by the beneficiary on December 25, 1997, the beneficiary does 
not claim to have been employed by the petitioner. However, in support of petition, the petitioner submitted 
copies of the beneficiary's 1998 through 2002 Forms W-2 which reflect wages earned of $1 1,700 or 
$24,928.80 less than the proffered wage of $36,628.80 in 1998, $18,400 or $18,228.80 less than the proffered 
wage of $36,628.80 in 1999, $20,800 or $15,828.80 less than the proffered wage of $36,628.80 in 2000, 
$20,800 or $15,828.80 less than the proffered wage of $36,628.80 in 2001, and $25,600 or $1 1,028.80 less 
than the proffered wage of $36,628.80 in 2002. The petitioner is obligated to establish that it has sufficient 
funds to pay the difference between the wages actually paid to the beneficiary and the proffered wage. 
As an alternative means of determining the petitioner's ability to pay the proffered wage, CIS will next 
examine the petitioner's net income figure as 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 COT. v. Suva, 632 F. Supp. 1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Hawaii, Ltd. v. 
Feldman, 736 F.2d 1305 (9~ Cir. 1984)); see also Chi-Feng Chang v. Thornburgh, 719 F. Supp. 532 (N.D. Tex. 
1989); K.C.P. Food Co., Inc. v. Suva, 623 F.Supp. 1080 (S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. Supp. 647 
(N.D. Ill. 1982), afd., 703 F.2d 571 (7" Cir. 1983). In K.C.P. Food Co., Inc., the court held that CIS had 
EAC 02 140 52693 
Page 4 
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. 623 F.Supp at 1084. The court specifically rejected the argument that 
CIS should have considered income before expenses were paid rather than net income. Finally, there is no 
precedent that would allow the petitioner to "add back to net cash the depreciation expense charged for the year." 
See also Elatos Restaurant Corp., 632 F. Supp. at 1054. 
Nevertheless, the petitioner's net income is not the only statistic that can be used to demonstrate a petitioner's 
ability to pay a 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. 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. Rather, CIS will consider net 
current assets as an alternative method of 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 a corporation's end-of-year net current assets are equal to or 
greater than the proffered wage, the petitioner is expected to be able to pay the proffered wage out of those net 
current assets. The petitioner's net current assets in 1997 through 2002 were -$18,679, -$8,597, $7,902, 
-$23,266 and -$105,835, respectively. The petitioner could not have paid the difference between the actual 
wages paid to the beneficiary and the proffered wage in 1997 through 2002 from its net current assets. 
Counsel contends that the petitioner's depreciation should be considered when determining the petitioner's 
ability to pay the proffered wage. Counsel's argument that the petitioner's depreciation deduction should be 
included in the calculation of its ability to pay the proffered wage is unconvincing. 
A depreciation deduction does not require or represent a specific cash expenditure during the year claimed. It 
is a systematic allocation of the cost of a tangible long-term asset. It may be taken to represent the diminution 
in value of buildings and equipment, or to represent the accumulation of funds necessary to replace perishable 
equipment and buildings. But the cost of equipment and buildings and the value lost as they deteriorate is an 
actual expense of doing business, whether it is spread over more years or concentrated into fewer. 
While the expense does not require or represent the current use of cash, neither is it available to pay wages. 
No precedent exists that would allow the petitioner to add its depreciation deduction to the amount available 
to pay the proffered wage. Chi-Feng Chang v. Thornburgh, 719 F.Supp. 532 (N.D. Texas 1989). See also 
Elatos Restaurant Corp. v. Suva, 632 F.Supp. 1049 (S.D.N.Y. 1985). The petitioner's election of accounting 
and depreciation methods accords a specific amount of depreciation expense to each given year. The 
According to Barron 's Dictionary ofAccounting Terms 11 7 (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 118. 
EAC 02 140 52693 
Page 5 
petitioner may not now shift that expense to some other year as convenient to its present purpose, nor treat it 
as a fund available to pay the proffered wage. Further, amounts spent on long-term tangible assets are a real 
expense, however allocated. 
Counsel asserts that the petitioner's lines of credit should be considered when determining the petitioner's 
ability to pay the proffered wage. However, 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 eligbility 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 of Katigbak, 14 I&N Dec. 45, 49 (Comrn. 
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 loa~s 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). 
Counsel urges that the petitioner's Schedule L Cash should be added to its net profits in calculating the funds 
available to the petitioner to pay the proffered wage. That calculation would be inappropriate. Some portion 
of the petitioner's revenue during a given year is paid in expenses and the balance is the petitioner's net 
income. Of its net income, some is retained as cash. Adding the petitioner's Schedule L Cash to its net 
income would likely be duplicative, at least in part. The petitioner's Schedule L Cash is included in the 
calculation of the petitioner's net current assets, which are considered separately from its net income. 
Finally, if the petitioner does not have sufficient net income or net current assets to pay the proffered salary, 
CIS may consider the overall magnitude of the entity's business activities. Even when the petitioner shows 
insufficient net income or net current assets, CIS may consider the totality of the circumstances concerning a 
petitioner's financial performance. See Matter of Sonegawa, 12 I&N Dec. 612 (Reg. Comm. 1967). In Matter 
of Sonegawa, the Regional Commissioner considered an immigrant visa petition, which had been filed by a 
small "custom dress and boutique shop" on behalf of a clothes designer. The district director denied the 
petition after determining that the beneficiary's annual wage of $6,240 was considerably in excess of the 
employer's net profit of $280 for the year of filing. On appeal, the Regional Commissioner considered an 
EAC 02 140 52693 
Page 6 
array of factors beyond the petitioner's simple net profit, including news articles, financial data, the 
petitioner's reputation and clientele, the number of employees, future business plans, and explanations of the 
petitioner's temporary financial difficulties. Despite the petitioner's obviously inadequate net income, the 
Regional Commissioner looked beyond the petitioner's uncharacteristic business loss and found that the 
petitioner's expectations of continued business growth and increasing profits were reasonable. Id. at 615. 
Based on an evaluation of the totality of the petitioner's circumstances, the Regional Commissioner 
determined that the petitioner had established the ability to pay the beneficiary the stipulated wages. 
As in Matter of Sonegawa, CIS may, at its discretion, consider evidence relevant to a petitioner's financial 
ability that falls outside of a petitioner's net income and net current assets. CIS may consider such factors as 
the number of years that the petitioner has been doing business, the established historical growth of the 
petitioner's business, the overall number of employees, the occurrence of any uncharacteristic business 
expenditures or losses, the petitioner's reputation within its industry, whether the beneficiary is replacing a 
former employee or an outsourced service, or any other evidence that CIS deems to be relevant to the 
petitioner's ability to pay the proffered wage. In the instant case, the petitioner has provided five tax returns. 
However, none of these tax returns demonstrate that the petitioner has the ability to pay the proffered wage, 
and they are not enough evidence to establish that the business has met all of its obligations in the past or to 
establish its historical growth. There is also no evidence of the petitioner's reputation throughout the 
industry. In addition, although it appears that the petitioner has been in business since 1979, the petitioner has 
not submitted any evidence that it has been a successful and profitable business. In fact, the constant infusion 
of money into the business through credit lines and loans would indicate just the opposite. 
After a review of the record, it is concluded that the petitioner has not established its ability to pay the salary 
offered as of the priority date of the petition and continuing until the beneficiary obtains lawful permanent 
residence. 
For the reasons discussed above and the assertions of counsel on appeal, the evidence submitted on appeal 
does not overcome the decision of the director. 
In visa petition proceedings, the burden of proving eligbility for the benefit sought remains entirely with the 
petitioner. Section 291 of the Act, 8 U.S.C. 9 1361. Here, that burden has not been met. 
ORDER: The appeal is dismissed