Businesses want to expand foreign investment
07/23/09 7:34AM By Ross Sneyd
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(Host) Several Vermont businesses say they've been able to expand and add jobs by relying on capital from foreign investors.
But they say ready access to that money could dry up unless Congress reauthorizes a special immigration program that encourages such investment.
VPR's Ross Sneyd reports.
(Sneyd) Bill Stenger traveled to Washington to make a pitch for the "EB-5 Immigrant Investor Regional Center Program."
Stenger is president of Jay Peak Resort and he says the fancy-sounding program has been a way to direct foreign investment into economically distressed areas like the Northeast Kingdom.
And he says that's been especially welcome in the current recession.
(Stenger) "In today's economy what is strangling the small business community in Vermont and nationally is the lack of access to capital. Affordable capital is almost nonexistent in this marketplace. However, through the EB5 Regional Center pilot program at Jay Peak we are well on our way to raising $100 million of equity capital."
(Sneyd) The EB-5 program allows foreign residents to invest $500,000 or more into a project.
In return, they get a conditional "green card" for two years that gives them the legal right to live in the United States.
They have to prove that their investment has created at least ten jobs within two years.
Stenger says he's relied on the program to expand Jay Peak's facilities so it gets business year-round, not just during the ski season.
(Stenger) "This country needs all the equity investment it can get right now. The EB5 program is a wonderful example of an economic stimulus that is tax-free, not a burden to anyone, and has nothing but good benefits for all involved."
(Host) But not everyone thinks as highly of the program. Some critics say it's a way for rich people to get visas to live in the United States.
Senator Patrick Leahy rejects the criticism. He says the program benefits both foreign investors and American businesses.
(Leahy) "We have 12 million illegal aliens in this country. I would like to have people who are legal and are creating jobs and are paying the bills."
(Sneyd) But the program has always operated under temporary authorizations and it's due to expire again in September.
Business people say if it were permanent, they might have more confidence to use it.
Leahy says that might happen soon. He's won Senate approval for a bipartisan amendment that would make the EB-5 program permanent. Leahy expects to serve on a conference committee on the bill and says he'll make sure the investment provision stays in the legislation.
For VPR News, I'm Ross Sneyd.