dismissed EB-3 Case: Restaurant Management

US. Department of EIomeland Security 
20 Mass. Ave., N.W., Rrn. 3000 
Washington, DC 20529 
PUBLIC Copy 
identifying data deleted to 
 event dearly ~~nwarranted 
invasion of personal privacy 
U. S. Citizenship 
and Immigration 
Office: NEBRASKA SERVICE CENTER Date: APR 2 6 2007 
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. fj 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. 
Administrative Appeals Office 
DISCUSSION: 
 The preference visa petition' was denied by the Acting Director (Director), Nebraska 
Service Center, and is now before the Administrative Appeals Office (AAO) on appeal. The appeal will be 
dismissed. 
The petitioner is a Mexican restaurant. It seeks to employ the beneficiary permanently in the United States as 
a vice president/treaswer. As required by statute, the petition is accompanied by a Form ETA 750, 
Application for Alien Employment Certification, approved by the Department of Labor (DOL). 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 also noted that there is no 
evidence in the record to demonstrate that the beneficiary meets the requirements of item 15 of the labor 
certification, as the requirement that the beneficiary has the ability to read and speak Spanish has not been 
established. The director 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 the decision. 
Further elaboration of the procedural history will be made only as necessary. 
As set forth in the director's April 8, 2005 denial, the two issues in this case are 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, and whether or not the petitioner has demonstrated that the beneficiary is 
qualified to perform the duties of the proffered position. 
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. €j 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 shlled labor (requiring at least two years 
training or experience), not of a temporary nature, for which qualified workers are not available in the United 
States. 
The regulation 8 C.F.R. €j 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 C.F.R.. 5 
204.5(d). The petitioner must also demonstrate that, on the priority date, the beneficiary had the qualifications 
This is an identical petition the petitioner filed on the behalf of the beneficiary based on the same approved 
labor certification. The previous I- 140 immigrant petition (LIN-03- 176-52 170) was filed on November 7, 
2002 and denied on April 3, 2003 because the director determined that the petitioner did not establish its 
continuing ability to pay the proffered wage. A subsequent appeal was filed on May 6, 2003, however, the 
AAO dismissed the appeal based on withdrawal by the petitioner on July 22, 2004. 
stated on its Form ETA 750 Application for Alien Employment Certification 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. 
Cornm. 1977). 
Here, the Form ETA 750 was accepted on April 30, 2001. The proffered wage as stated on the Form ETA 
750 is $57.84 per hour ($120,307.20 per year). The Form ETA 750 states that the position requires four years 
of experience in the related occupation of restaurant manager and ability to read and speak Spanish. 
The AAO takes a de novo look at issues raised in the denial of this 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 
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pertinent evidence in the record, including new evidence properly submitted upon appeal . Relevant evidence 
in the record includes the petitioner's corporate federal tax returns for 2001 and 2002. The record does not 
contain any other evidence relevant to the petitioner's ability to pay the wage. 
The evidence in the record of proceeding shows that the petitioner is structured as an S corporation. The 
petitioner claimed to have been established in 1999. The petitioner did not provide information about its 
gross annual income, net annual income and current number of employees on the instant petition form. 
However, the petitioner claimed to have a gross annual income of $1,003,573, to have a net annual income of 
$32,491, and to employ 26 workers on the previously submitted Form 1-140. According to the tax returns in 
the record, the petitioner's fiscal year is based on a calendar year. On the Form ETA 750B signed on April 
16,2001, the beneficiary did not claim to have worked for the petitioner. 
On appeal, counsel asserts that the director did not properly consider all of the financial documentation 
submitted in determining the ability of the petitioner 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 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. 5 204.5(g)(2). In 
evaluating whether a job offer is realistic, Citizenship and Immigration Services (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. 61 2 (Reg. Cornrn. 1967). 
In determining the petitioner's ability to pay the proffered wage during a given period, 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, 
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The submission of additional evidence on appeal is allowed by the instructions to the Fonn I-290B, which 
are incorporated into the regulations by the regulation at 8 C.F.R. 5 103.2(a)(l) and 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). Counsel indicated on the Form I-290B that he needs 90 
days to submit a brief andlor evidence to the AAO. The AAO sent a fax on March 5, 2007 requesting that a 
copy of the additional evidence and lor brief be sent to the AAO within five business days. Counsel admitted 
that he did not file a brief or evidence in support of the appeal as he indicated on Form I-290B. Therefore, the 
AAO will review and make a decision based on the evidence in the record only. 
Page 4 
the evidence will be consideredprima facie proof of the petitioner's ability to pay the proffered wage. In the 
instant case, the petitioner did not submit any evidence to show that the petitioner paid the beneficiary any 
amount of compensation in the relevant years. In the initial submission letter counsel asserted that the 
petitioner paid salaries of $240,000 in 2001 and $270,000 in 2002 which were more than twice the salary to 
be paid to the beneficiary. In general, wages already paid to others are not available to prove the ability to 
pay the wage proffered to the beneficiary at the priority date of the petition and continuing to the present. The 
record does not name any workers who would be replaced by the beneficiary, state their wages, verify their 
full-time employment, or provide evidence that the petitioner has replaced or will replace them with the 
beneficiary. Moreover, the Form 1-140 indicates that the proffered position is a new position with the 
petitioner. Therefore, the petitioner could not document that any existing positions involve the same duties as 
those set forth in the Form ETA 750. If that employee performed other kinds of work, then the beneficiary 
could not have replaced him or her. Counsel also claimed that the petitioner paid the beneficiary consulting 
fees of $42,000 in 2003. However, the record does not contain any evidence to support his assertions. The 
assertions of counsel do not constitute evidence. Matter of Obaigbena, 19 I&N Dec. 533, 534 (BIA 1988); 
Matter of Ramirez-Sanchez, 17 I&N Dec. 503, 506 (BIA 1980). Going on record without supporting 
documentary evidence is not sufficient for purposes of meeting the burden of proof in these proceedings. 
Matter of Soffici, 22 I&N Dec. 158, 165 (Comm. 1998) (citing Matter of Treasure Craft of California, 14 
I&N Dec. 190 (Reg. Comm. 1972)). Thus, the petitioner failed to establish its ability to pay the proffered 
wage through wages paid to the beneficiary from 2001 onwards. 
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, 71 9 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)' afd, 703 F.2d 571 (7th Cir. 1983). 
Counsel's reliance on the petitioner's gross income and gross profit is misplaced. Showing that the 
petitioner's total income 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, 623 F. Supp. at 1084, the court held that the Immigration and 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. In the submission letter counsel also 
requested adding depreciation and amortization to the net income. Counsel's reliance on the petitioner's 
depreciation and amortization in determining its ability to pay the proffered wage is misplaced. The court in 
K.C.P. Food Co., Inc. v. Sava 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 the 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 and rejected. See Elatos, 632 
F. Supp. at 1054. [CIS] and judicial precedent support the use of tax returns and the net 
income figures in determining petitioner's ability to pay. Plaintiffs' argument that these 
figures should be revised by the court by adding back depreciation is without support. 
Page 5 
(Emphasis in original.) Chz-Fengat 537. 
The record contains copies of the petitioner's Form 1120s U.S. Income Tax Return for an S Corporation for 2001 
and 2002. The petitioner's tax returns demonstrate the following financial information concerning the 
petitioner's ability to pay the proffered wage of $120,307.20 per year from the priority date: 
In 200 1, the Form 1 120s stated a net income3 of $8,491. 
In 2002, the Form 1 120s stated a net income of $19,203. 
Therefore, for the years 2001 and 2002, the petitioner did not have sufficient net income to pay the proffered 
wage in these years. 
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 liabilitie~.~ 
 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's net current assets during 2001 were $(55,815). 
The petitioner's net current assets during 2002 were $(192,167). 
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 Where an S corporation's income is exclusively from a trade or business, CIS considers net income to be the 
figure for ordinary income, shown on line 21 of page one of the petitioner's Form 1 120s. The instructions on 
the Form 1120s U.S. Income Tax Return for an S Corporation state on page one, "Caution: Include only trade 
or business income and expenses on lines 1 a through 2 1 ." 
Where an S corporation has income from sources other than from a trade or business, net income is found on 
Schedule K. The Schedule K form related to the Form 1120s states that an S corporation's total income from 
its various sources are to be shown not on page one of the Form 1120s' but on line 23 of the Schedule K, 
Shareholders' Shares of Income, Credits, Deductions, etc. For example, an S corporation's rental real estate 
income is carried over from the Form 8825 to line 2 of Schedule K. Similarly, an S corporation's income 
from sales of business property is carried over from the Form 4979 to line 5 of Schedule K. See Internal 
Revenue Service, Instructions for Form 1120s (2003), available at http://www.irs.gov/pub/irs-prior/i1120s-- 
2003 .pdf; Instructions for Form 1 120s (2002), available at http://www.irs.gov/pub/irs-priorli 1 120s- 
2002 .pdf. 
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According to Barron'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 1 18. 
Therefore, for the years 2001 and 2002, the petitioner did not have sufficient net current assets to pay the 
proffered wage. 
The record before the director in the instant case closed on July 2, 2004 with the receipt by the director of the 
petitioner's submission of the initial filing. As of that date the petitioner's federal tax return for 2003 should 
have been available. However, the petitioner did not submit its 2003 tax return, nor did counsel explain why 
the tax return or other regulatory-prescribed evidence for 2003 was not submitted. In visa petition 
proceedings, the burden is on the petitioner to establish eligibility for the benefit sought. See Matter of 
Brantigan, 11 I&N Dec. 493 (BIA 1966). The tax returns would have demonstrated the amount of taxable 
income the petitioner reported to the IRS and further reveal its ability to pay the proffered wage. The 
petitioner failed to establish its ability to pay the proffered wage in 2003 because it failed to submit its 2003 
tax return or other regulatory-prescribed evidence. 
Therefore, from 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 continuing ability to pay the beneficiary the proffered wage as of 
the priority date through an examination of wages paid to the beneficiary and its net income or net current 
assets. 
Counsel asserted in his submission letter accompanying the initial filing that there was another way to 
determine the petitioner's continuing ability to pay the proffered wage from the priority date. Counsel 
recommended the use of retained earnings to pay the proffered wage. Retained earnings are the total of a 
company's net earnings since its inception, minus any payments to its stockholders. That is, this year's 
retained earnings are last year's retained earnings plus this year's net income. Adding retained earnings to net 
income and/or net current assets is therefore duplicative. Therefore, CIS looks at each particular year's net 
income, rather than the cumulative total of the previous years' net incomes represented by the line item of 
retained earnings. 
Further, even if considered separately from net income and net current assets, retained earnings might not be 
included appropriately in the calculation of the petitioner's continuing ability to pay the proffered wage 
because retained earnings do not necessarily represent funds available for use. Retained earnings can be 
either appropriated or unappropriated. Appropriated retained earnings are set aside for specific uses, such as 
reinvestment or asset acquisition, and as such, are not available for shareholder dividends or other uses. 
Unappropriated retained earnings may represent cash or non-cash and current or non-current assets. The 
record does not demonstrate that the petitioner's retained earnings are unappropriated and are cash or current 
assets that would be available to pay the proffered wage. 
The AAO finds that the director properly considered all of the financial documentation submitted in 
determining the petitioner's ability to pay the proffered wage. The evidence submitted does not establish that 
the petitioner had the continuing ability to pay the proffered wage beginning on the priority date. Counsel's 
assertions on appeal cannot be concluded to outweigh the evidence presented in the tax returns as submitted 
by the petitioner that demonstrates that the petitioner could not pay the proffered wage from the day the Form 
ETA 750 was accepted for processing by the Department of Labor. 
The second issue in this case is whether or not the petitioner has demonstrated that the beneficiary is qualified 
to perform the duties of the proffered position. The director noted in his April 8, 2005 denial that there is no 
evidence in the record to demonstrate that the beneficiary meets the requirements of item 15 of the labor 
certification, as the requirement that the beneficiary has the ability to read and speak Spanish has not been 
established. 
On April 21, 2005, counsel filed a timely appeal on the Form I-290B without any separate brief or evidence. 
Counsel states the reason for the appeal that "[tlhe reviewing officer did not properly consider all of the 
financial documentation submitted in determining the ability of the petitioner to pay the proffered wage." 
However, counsel has not provided any evidence to rebut the ground of denial that the petitioner failed to 
demonstrate that the beneficiary met the requirements of item 15 of the labor certification. Counsel has not 
even expressed disagreement with the director's decision on ths issue. In visa petition proceedings, the burden 
is on the petitioner to establish eligibility for the benefit sought. See Matter of Brantigan, 11 I&N Dec. 493 
(BIA 1966). The petitioner has not established that the beneficiary has the ability to read and speak Spanish. 
Thus, the ground of the director's decision that the petitioner failed to demonstrate that the beneficiary was 
qualified to perform the duties of the proffered position because it failed to demonstrate that the beneficiary 
met the requirements of item 15 of the labor certification is affirmed. 
The petition will be denied for the above stated reasons, with each considered as an independent and 
alternative basis for denial. In visa petition proceedings, the burden of proving eligibility for the benefit 
sought remains entirely with the petitioner. Section 291 of the Act, 8 U.S.C. 8 1361. Here, that burden has 
not been met. 
ORDER: The appeal is dismissed.