sustained EB-3 Case: Digital Printing And Graphic Design

identifying data deleted to
preventcleartyunwarr~nted
invasIonofpersona~ pnvac)
PUBLICCOpy.
U.S. Department of Homeland Security
20 Mass. Ave., N.W., Rm. 3000
Washington, DC 20529
u.s.Citizenship
and Immigration
Services
FILE:
WAC 03 13350378
Office: CALIFORNIA SERVICE CENTER Date: APR 19 fOOl'
INRE: Petitioner:
Beneficiary:
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. § 1153(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.
Robert P. Wiema , hief
Administrative Appeals Office
www.uscis.gov
DISCUSSION: The Director, California Service Center, initially approved the employment-based preference visa
petition. In connection with the beneficiary~s Application to Register Permanent Resident or Adjust Status (Form 1­
485), the director served the petitioner with notice of intent to revoke the approval of the petition (NOIR). In a Notice
of Revocation (NOR), the director ultimately revoked the approval of the Immigrant Petition for Alien Worker (Form
1-140), and the petitioner appealed to the Administrative Appeals Office (AAO). On March 14, 2007, the AAO
rejected the appeal as untimely filed. However, at the same time of the rejection, the AAO certified the director's
decision, dated October 12,2006, the initial decision in this matter, to itself pursuant to 8 C.F.R. §§ 103.4(a)(4) and
(a)(5). The petitioner was granted thirty (30) days after service of the rejection notice to submit a brief to the AAO.
The AAO will withdraw the director's decision and approve the petition.
Section 205 of the Act, 8 U.S.C. § 1155, provides that "[t]h~ Attorney General [now Secretary, Department of
Homeland Security], may, at any time, for what he d~eins to be good and sufficient cause, revoke the approval of
any petition approved by him under section 204." The realization by the director that the petition was approved in
error may be good and sufficient cause for revoking the approval. Matter of Ho, 19 I&N Dec. 582, 590 (BIA
1988).
The petitioner provides digital printing and graphic design services for garment wholesalers and manufacturers. It
seeks to employ the beneficiary permanently in the United States as calibration laboratory technician. 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
revoked the approval of the petition accordingly.
The record indicates that the Immigrant Petition for Alien Worker (1-140) was filed on March 28, 2003. It was
initially approved on Aqgust 20,2003. The alien beneficiary filed an application to adjust his status to that oflawful
permanent resident. Following the receipt of information from both the petitioner and beneficiary relevant to the
beneficiary's application to adjust to permanent resident status, the director concluded that the 1-140 was approved in
error and issued an intent to revoke the petition on July 26, 2006. The director concluded that the petitioner had failed
to establish its continuing ability to pay the proffered wage as of the visa priority date. The petitioner's response and
subsequent submission of additional evidence failed to convince the director to revise his decision and the petition's
approval was revoked on October 12,2006, pursuant to section 205 of the Act, 8 U.S.c. § 1155.
On appeal, the petitioner, through counsel, provides previously submitted documentation and asserts that the director's
analysis did not accurately reflect the petitioner's ability to pay 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 iinmigrants 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. I
The regulation at 8 C.F.R. § 204.5(g)(2) provides in pertinent part:
Ability ofprospective 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
Page 3
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 ofLabor. See 8 CFR § 204.5(d). The priority date inthe instant petition is June 25, 2001: The
proffered wage as stated on the Form ETA 750 is $24.00 per hour or $49,920 annually.
The AAO takes a de novo lookat 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 pertinent
evidence in the record, including new evidence properly submitted upon appeal
l
. Relevant evidence submitted on
appeal includes previously submitted evidence and counsel's brief. The record does not contain any other evidence
relevant to the petitioner's ability to pay the proffered wage.
Relevant to the petitioner's ability to pay the proposed annual wage offer of $49,920, copies of the petitioner's Form
1120, U.S. Corporation Income Tax Return for·the years 2001 through 2005 are provided in the record. The director
concluded that out of the five years represented on the tax returns, the petitioner failed to show its ability to pay the
proffered wage in 2001 and 2002. Those tax returns contained the following information:
Net income
Current Assets
Current Liabilities
Net current assets
Net income
Current Assets
Current Liabilities
Net current assets
2001 2002 2003
$ 9,966 $ 0 $25,796
$ 473,137 $ 433,617 $458,462
$ 436,306 $ 399,795 $335,734
$ 36,831 $ 33,822 $122,728
2004 2005
$ 35,722 $ 16,536
$413,658 $505,325
$229,956 $257,216
$183,702 $248,109
Other relevant previously submitted evidence includes some of the petitione~'s bank statements2 and copies of pay
stubs, issued by the petitioner to the beneficiary, for the pay periods April 21, 2005 through May 4,2005 and May 19,
1 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. § 103.2(a)(l). The record in the instant case
provides no reason to preclude consideration of any ofthe documents newly submitted on appeal. See Matter of
Soriano, 19 I&N Dec. 764 (BIA 1988). . .
2 Counsel's reliance on the balances in the petitioner's bank accounts ismisplaced. First, bank statements are not
among the three types of evidence, enumerated in 8 C.F.R. § 204.5(g)(2), required to illustrate a petitioner's ability to
pay a proffered wage. While this regulation allows additional material "in appropriate cases," the petitioner in this
case has not demonstrated why the documentation specified at 8 C.F.R.§ 204.5(g)(2) is inapplicable or otherwise. .
Page 4
2005 through June 1, 2005. The beneficiary's pay stubs reflect wages paid of $960 each pay period. If the
beneficiary were paid that amount each pay period, the result would be the proffered wage of $49,920.
The petitioner must establish that' its job offer t6 the beneficiary is a realistic one. Because the filing of an ETA 750
labor certification'application establishes a priority date for an)' 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 perrrianent residence. The petitioner's ability to pay the
proffered wage is an essential element in evaluating whether ajob offer is realistic. -SeeMatter ofGreat Wall, 16 I&N
Dec. 142 (Acting Reg. Comm. 1977). See also 8 C.F.R. § 204.5(g)(2). In evaluating whether ajob 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 ofSonegawa, 12 I&N Dec. 612 (Reg. Comm. 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, the
evidence will be considered prima facie proof of the petitioner's ability to pay the proffered wage. In the instant
case, the petitioner provided no evidence of the wages it paid to the beneficiary during the requisite years with the
exception of part of2005. ' '
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 Corp. v. Sava, 632 F.
Supp. 1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Hawaii, Ltd. v. Feldman, 736 F.2d 1305 Wh Cir.
1984»; see also Chi-Feng Chang v. Thornburgh, 719 F. Supp. 532 (N.D: Tex. 1989); K.CF. Food Co., Inc. v. Sava,
623 F.Supp. 1080 (S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. Supp. 647 (N.D. lll. 1982), aff'd., 703 F.2d 571 (7th Cir.
1983). In K.CF. Food Co., Inc., the court held that 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. 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. 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.
paints an inaccurate financial picture of the petitioner. Second, bank statements show the amount in an account on a
given date, and cannot show' the sustainable ability to, pay a proffered wage. Third, no evidence was submitted to
demonstrate that the funds reported on the petitioner's bank statements somehow reflect additional available funds
that were not reflected on its tax retum, such as the petitioner's taxable income (income minus deductions) or the cash
specified on Schedule L that will be considered below in determining the petitioner's net current assets.
Page 5
(Emphasis in original.) Chi-Feng at 537.
The evidence in the record of proceeding shows that the petitioner is structured as a C corporation. According to
the tax returns in the record, the petitioner's fiscal year is based on a calendar year. The tax returns demonstrate
that the petitioner's net income in 2001 through 2005 was $9,966, $0, $25,796, $35,722, and $16,536. Therefore,
the petitioner could not have paid the proffered wage of $49,920 from its net income in 2001 through 2005.
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.3 A
corporation's year-end current assets are shown on Schedule L, lines led) through 6(d). Its year-end current
liabilities are shown on lines l6(d) through l8(d). 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 during the years in question, 2001 through 2005, were $36,831,
$33,822, $122,728, $18~,702, and $248,109, respectively. The petitioner could have paid the proffered wage of
$49,920 from its net current assets in 2003 through 2005, but not in 2001 and 2002.
On appeal, counsel claims that the petitioner's depreciation and the fact that the petitioner has paid the proffered
wage from the time the beneficiary became employed by it should be considered when determining the
petitioner's ability to pay the proffered wage of $49,920. However, 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 acpumulation 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. Sava, 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 petitioner may
3 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 118.
Page 6
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.
The fact that the petitioner has paid the beneficiary the proffered wage of $49,920 from the time the beneficiary
first became employed by it, some time in 2005, does not establish the petitioner's ability to pay the proffered
wage from the priority date of June 25, 2001 and continuing until the beneficiary obtains lawful permanent
residence. 8 C.F.R. § 204.5(g)(2).
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 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 ofSonegawa , 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, in light of the petitioner's long and continuing business presence (more than
16 years), since the petitioner has shown that it has paid total wages and compensation in excess of $1 million
yearly, and since the proffered wage offered to the beneficiary in the significant years is meager when compared
to the petitioner's continuous earnings of over approximately $3 million yearly, the AAO finds that the petitioner
could pay the proffered wage in 2001 and continuing to the present.
After a review of the record, it is concluded that the petitioner has 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
overcomes the decision ofthe director.
As always, the burden of proving eligibility for the benefit sought remains entirely with the petitioner. Section 291 of
the Act, 8 U.S.c. § 1361. Here that burden has been met.
. ORDER: The director's October 12, 2006 decision is withdrawn. The petition is approved.