Degree or an Alien of Exceptional Ability Pursuant to Section 203(b )(2) of the Immigration and Nationality Act, 8 U.S.C. § 1153(b)(2)
ON BEHALF OF PETITIONER :
INSTRUCTIONS:
Enclosed please find the decision of the Administrative Appeals Office (AAO) in your case. This is a non-precedent decision. The AAO does not announce new constructions of law nor establish agency policy through non-precedent decisions. If you believe the AAO incorrectly applied current law or policy to your case or if you seek to present new facts for consideration, you may file a motion to reconsider or a motion to reopen, respectively. Any motion must be filed on a Notice of Appeal or Motion (Form J-290B) within 33 days of the date of this decision. Please review the Form I-290B instructions at http://www.uscis.gov/forms for the latest information on fee, filing location, and other requirements. See also 8 C.F.R. § 103.5. Do not file a motion directly with the AAO.
Thank you,
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~· Rosenberg o Chief, Administrative Appeals Office www.uscis.gov
DISCUSSION: The preference visa petition was denied by the Director, Texas Service Center , and is now before the Administrative Appeals Office (AAO) on appeal. The appeal will be dismissed. The petitioner describes itself as a freight forwarding company. It seeks to permanently employ the beneficiary in the United States as a business manager. The petitioner requests classification of the beneficiary as an advanced degree professional pursuant to section 203(b )(2) of the Immigration and Nationality Act (the Act), 8 U.S.C. § 1153(b)(2). 1As required by statute, the petition is accompanied by ETA Form 9089, Application for Permanent Employment Certification, approved by the United States 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 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 July 19, 2013 denial, the primary 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)(ii) of the Immigration and Nationality Act (the Act), 8 U.S.C. § 1153(b )(3)(A)(ii), provides for the granting of preference classification to qualified immigrants who hold baccalaureate degrees and are members of the professions.
The regulation at 8 C.F.R. § 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 either 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 ETA Form 9089, Application for Permanent Employment Certification , was accepted for processing by any office within the employment system of the DOL. 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 ETA Form 9089, Application for Permanent Employment Certification, as certified by the DOL and submitted with the instant petition. Matter of Wing's Tea House, 16 I&N Dec. 158, 160 (Acting Reg'l Comm'r 1977).
Section 203(b )(2) of the Act provides immigrant classification to members of the professions holding advanced degrees , whose services are sought by an employer in the United States. p. 3 Here, the ETA Form 9089 was accepted on October 30, 2012. The proffered wage as stated on the ETA Form 9089 is $108,000 per year. The ETA Form 9089 states that the position requires a master's degree and twelve months of experience in the job offered or in the alternative a bachelor's degree with five years of progressive experience.
The AAO conducts appellate review on a de novo basis. See Soltane v. DOl, 381 F.3d 143, 145 (3d Cir. 2004). The AAO considers all pertinent evidence in the record, including new evidence properly submitted upon appeal.2
The evidence in the record of proceeding shows that· the petitioner is structured as an S corporation. On the petition, the petitioner claimed to have been established in 2008 and to currently employ three workers. According to the tax returns in the record, the petitioner's fiscal year is based on a calendar year.
The petitioner must establish that its job offer to the beneficiary is a realistic one. Because the filing of an ETA Form 9089 labor certification application establishes a priority date for any immigrant petition later based on the ETA Form 9089, 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, 144 (Acting Reg'l Comm'r 1977); see also 8 C.F.R. § 204.5(g)(2). In evaluating whether a job offer is realistic, United States Citizenship and Immigration Services (USCIS) 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. 612,614-15 (Reg'l Comm'r 1967).
In determining the petitioner ' s ability to pay the proffered wage during a given period , USCIS 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 has not established that it paid the beneficiary the full proffered wage during any relevant timeframe including the period from the priority date in October 30, 2012 or subsequently.
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, USCIS will next examine the net income figure reflected on the petitioner's federal income tax return, without consideration of depreciation or other expenses. River St. Donuts, LLC v. Napolitano, 558 F.3d 111, 118 (1st Cir. 2009); Taco Especial v. Napolitano, 696 F. Supp. 2d 873, 880 (E.D. Mich. 2010), aff'd , No. 10-1517 (6th Cir. Nov. 10, 2011) . Reliance on federal income tax returns as a basis for determining a petitioner's ability to pay 2 The submission of additional evidence on appeal is allowed by the instructions to the Form I-290B, which are incorporated into the regulations at 8 C.F.R. § 103.2(a)(1). 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, 766 (BIA 1988). p. 4 the proffered wage is well established by judicial precedent. Elatos Rest. Corp. v. Sava, 632 F. Supp. 1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Haw., Ltd. v. Feldman, 736 F.2d 1305 (9th eir. 1984)); see also Chi-Feng Chang v. Thornburgh, 719 F. Supp. 532, 537 (N.D. Tex. 1989); K.C.P. Food Co. v. Sava, 623 F. Supp. 1080, 1084 (S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. Supp. 647, 650 (N.D. Ill. 1982), aff'd, 703 F.2d 571 (7th eir. 1983). Reliance on the petitioner's gross receipts and wage expense is misplaced. Showing that the petitioner's gross receipts 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., 623 F. Supp. at 1084, the court held that the Immigration and Naturalization Service, now users, 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. The court specifically rejected the argument that users should have considered income before expenses were paid rather than net income. See also Taco Especial, 696 F. Supp. 2d at 881 (gross profits overstate an employer's ability to pay because it ignores other necessary expenses) .
With respect to depreciation, the court in River Street Donuts noted:
The AAO recognized that a depreciation deduction is a systematic allocation of the cost of a tangible long-term asset and does not represent a specific cash expenditure during the year claimed. Furthermore, the AAO indicated that the allocation of the depreciation of a long-term asset could be spread out over the years or concentrated into a few depending on the petitioner's choice of accounting and depreciation methods. Nonetheless, the AAO explained that depreciation represents an actual cost of doing business, which could represent either the diminution in value of buildings and equipment or the accumulation of funds necessary to replace perishable equipment and buildings. Accordingly, the AAO stressed that even though amounts deducted for depreciation do not represent current use of cash, neither does it represent amounts available to pay wages .
We find that the AAO has a rational explanation for its policy of not adding depreciation back to net income. Namely, that the amount spent on a long term tangible asset is a "real" expense.
River St. Donuts, 558 F.3d at 118. "[USerS] 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." Chi-Feng Chang, 719 F. Supp. at 537 (emphasis added).
The record before the director closed on July 9, 2013 with the receipt by the director of the petitioner's submissions in response to the director's request for evidence. As of that date, the petitioner's 2013 federal income tax return was not yet due. Therefore , the petitioner ' s income tax return for 2012 is the most recent return available. The petitioner's tax returns demonstrate its net income for 2012, as shown in the table below.
- In 2012, the Form 1120S stated net income 3 of $52,255.
Therefore , for the year 2012, the petitioner did not have sufficient net income to pay the proffered wage.
As an alternate means of determining the petitioner's ability to pay the proffered wage, USCIS may review the petitioner's net current assets. Net current assets are the difference between the petitioner's current assets and current liabilities. 4 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 tax returns demonstrate its end-of year net current assets for 2012, as shown in the table below.
- In 2012 , the Form 1120S stated net current assets of $11,355.
Therefore, for the year 2012, the petitioner did not have sufficient net current assets to pay the proffered wage.
Therefore, from the date the ETA Form 9089 was accepted for processing by the DOL, 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.
Counsel asserts on appeal that the director should have relied upon the petitioner's ability to pay the proffered wage in prorating the proffered wage from October 2012 through December 2012 and then comparing the prorated wage to the petitioner's net income for 2012. Counsel states that the prorated wage is about $18,000 and the petitioner's net income for 2012 is $52,255.
Counsel requests that USCIS prorate the proffered wage for the portion of the year that occurred after the priority date. We will not, however, consider 12 months of income towards an ability to pay a lesser period of the proffered wage any more than we would consider 24 months of income towards paying the annual proffered wage. While USCIS will prorate the proffered wage if the record contains evidence of net income or payment of the beneficiary's wages specifically covering the portion of the year that occurred after the priority date (and only that period), such as monthly income statements or pay stubs, the petitioner has not submitted such evidence .Not eligible at the time of filing
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 ETA Form 9089 was accepted for processing by the DOL.
USCIS may consider the overall magnitude of the petitioner's business activities in its determination of the petitioner's ability to pay the proffered wage. See Sonegawa, 12 I&N Dec. at 614-15. The petitioning entity in Sonegawa had been in business for over 11 years and routinely earned a gross annual income of about $100,000. During the year in which the petition was filed in that case, the petitioner changed business locations and paid rent on both the old and new locations for five months. There were large moving costs and also a period of time when the petitioner was unable to do regular business. The Regional Commissioner determined that the petitioner's prospects for a resumption of successful business operations were well established. The petitioner was a fashion designer whose work had been featured in Time and Look magazines. Her clients included Miss Universe, movie actresses, and society matrons. The petitioner's clients had been included in the lists of the best-dressed California women. The petitioner lectured on fashion design at design and fashion shows throughout the United States and at colleges and universities in California. The Regional Commissioner 's determination in Sonegawa was based in part on the petitioner's sound business reputation and outstanding reputation as a couturiere. As in Sonegawa, USCIS may, at its discretion, consider evidence relevant to the petitioner's financial ability that falls outside of a petitioner's net income and net current assets. USCIS may consider such factors as the number of years 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 USCIS deems relevant to the petitioner's ability to pay the proffered wage.
In the instant case, the petitioner has been in business since 2008 and employs three workers. In support of the instant petition, the petitioner has provided copies of its 2011 and 2012 federal income tax returns. Upon review of the tax returns and the evidence in the record, the salaries and wages reported in 2011 is $81,270, in 2012 $146,651; these amounts average approximately $38,000 per year for three employees. The proffered wage for the beneficiary's salary is more than twice- that average at $107,266 per year. The wages paid do not suggest realistically that the petitioner will be able to pay the proffered wage from the priority date. The petitioner has not established its reputation within its industry; any uncharacteristic business expenditures; and/or whether the beneficiary is replacing a former employee or an outsourced service. Thus, assessing the totality of the p. 7 circumstances in this individual case, it is concluded that the petitioner has not established that it had the continuing 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.
Further, according to USCIS records, the petitioner has filed one I-140 petition on behalf of another beneficiary. Accordingly , the petitioner must establish that it has had the continuing ability to pay the combined proffered wages to each beneficiary from the priority date of the instant petition. See Matter of Great Wall, 16 I&N Dec. 142, 144-145 (Acting Reg'l Comm 'r 1977).
The evidence in the record does not document the priority date, proffered wage or wages paid to the other beneficiary, whether the other petition has been withdrawn, revoked, or denied, or whether the other beneficiary has obtained lawful permanent residence. Thus, it is also concluded that the petitioner has not established its continuing ability to pay the proffered wage to the beneficiary and the proffered wage to the beneficiary of its other petition.
In visa petition proceedings, it is the petitioner's burden to establish eligibility for the immigration benefit sought. Section 291 of the Act, 8 U.S.C. § 1361 ; Matt er of Otiend e, 26 I&N Dec. 127, 128 (BIA 2013) . The petitioner has not met that burden.
ORDER: The appeal is dismissed.