The China
City of America
【Comment】
The US
government is on the alert for Chinese companies, one of which is Hua-Wei, a
PLA-related company, but it is not even aware of the impact of “The China City
of America.”
With more than 2,000 acres
and 1,000 residents, it is definitely not a traditional Chinese Town, not just a
block or two in the metropolitan areas.
According
to the US Immigration Act of 1990, any foreigner will get the US Permanent Residency
once he/she invests half million US dollar, which amount can only buy a 100
square-meters ordinary apartment in Taipei City.
The area
of the China City of America will make it a Chinese leased territory on the US
soil, but governed by Chinese civil law.
Another
question might be: How could we expect
China to effectively manage her own serious domestic problems, if the rich
could flee at such a tiny cost? Revised
at 20131207
美國政府只注意到中國公司華為，並未警覺到中國人造鎮的影響。這不是唐人街而已。
基於美國移民法的投資移民 EB-5，只要投資50萬美元就可以擁有永久居留權。中國已經在紐約附近建設純中國的的城鎮──當然比起單純的街區來得大。
50萬美元，不過1500萬新台幣，大概一戶台北中古大樓房屋的價格。
這會是租界──鎮內管理是依據美國法律，還是視同保留區行使中國法律？
問題是：假使中國富人可簡單離開中國，如何奢望，為富而仁？特別是上海空氣污染已經創記錄！
The China
City of America
The China City of America will house many
commerce, tourism and luxury businesses. This opportunity provides a gateway
for investment immigrations, company registrations, bilingual businesses, U.S.
government relations, public relations, and capital market financing.
美國中國之城項目是一個集商貿，旅遊，高級住宅的極具中國文化特色的專案，為新一代中國商人成功打開國際化平臺，社區整體配合客戶提供全方位服務，協助辦理客戶投資移民，公司開辦，中英文商務協助，美國政府關係，公共關係，資本市場融資和上市。美國中國城專案將成為中國文化，現代商業在美國境內的完美展示，實現零距離中美交流， 拓展無限商機，開創廣闊未來！
China City of America will use both English and
Chinese. China City of America will provide business opportunities to law
firms, accounting firms, travel agents, banks, nurseries, schools,
universities, hospitals, shipping, supermarkets, and logistics companies. These
companies will provide English and Chinese services to residents providing
investors and residents an easy transition into the United States.
整體園區採取中英文雙語配套管理，引進各類專業雙語服務機構，律師，會計，旅行社，銀行，托兒所，學校，大學，醫院，快遞，超市，海關報關行，物流服務。讓所有的中國家庭和企業能夠輕鬆進駐，立即適應可開展在美國的生活和業務，在園區的協助下快速進入美國主流社會。
中國家庭客戶群：Chinese family customer base:
China City of America will provide two
residential styles for investors. For Chinese investors that would like to stay
in the United States for a shorter amount of time or have a vacation home
overseas, China City of America provides timeshares. Chinese investors that
plan to reside in the United States or have children already studying abroad in
the United States, China City of America have complete single family houses.
針對中國家庭和投資移民群體的居住需求，公寓，別墅和四合院均可採取 (Timeshare) 時段分享產權購買模式，以滿足不同家庭的需要，時段分享產權可讓家庭選擇每年一週，兩周或更多，方便主要時間仍然在中國工作的家庭的短期回美需要。公寓，別墅和四合院也可根據客戶需求按整體產權購買，整體產權可讓有子女海外就讀，長期居住的的家庭擁有。
China's
Enterprise Customer Base:中國企業客戶群：
China City of America provides purchasing and
leasing of commercial offices and showrooms to Chinese companies that are
looking to expand business operations and increase brand recognition
internationally. Offices and showrooms can be built according to the companies’
request. China City of America’s retail space will provide outlets to companies
that deal with toys, clothes, shoes, hats, kitchen and bathroom supplies,
bedding, cosmetics, jewelry, sporting goods, furniture, appliances, artwork,
tools, agricultural, wedding services, and etc.
針對中國企業海外業務及辦事處的需求，商業大樓辦公室和展廳可按整體產權購買和租賃，可按客戶內部結構要求建造。園區除旅遊紀念品為自主品牌外，中華古城購物中心由中國零售商家和廠家直營店進駐，產品內容涵蓋廣泛：兒童用品玩具，衣服，鞋帽，廚房用品，浴室用品，床上用品，化妝品，首飾，運動用品，傢俱，家電，藝術品，建材，工具，農副產品，書店，結婚服務等。可在商業大樓設批發辦公室。
Visitors
customers:旅遊客戶群：
According to the U.S. Department of Commerce
announcement by New York Committee Gary Locke, U.S. tourism industry grew by
47% in 2010 and International tourists spent $ 122.7 billion U.S. dollars in
the United States last year. Tourism continues to be the highlight of the U.S.
economy, in the meanwhile 8 million jobs was created.
根據美國商務部紐約委員會Gary Locke 宣佈，美國旅遊業在2010年增長了47%，國際遊客2010年在美國花費了$1227 億美元。 旅遊業持續成為美國的經濟亮點，旅遊業在全美創造了8百萬個工作機會。
American
Family customers 美國家庭客戶群 ：
In a 2011 survey data, more than half of U.S.
households plan to spend rebate checks on travelling this year. Parks with
various children recreational facilities and malls with varieties of consumer
goods attract the attention of customers.
2011年的民調顯示，超過半數以上的美國家庭計畫將退稅支票花在旅遊上。由於園區有兒童喜愛的各種遊樂設施，可以吸引所有美國家庭前往旅遊消費，由於購物中心內有各種家庭成員的消費品，以及交通便利可以使美國家庭週末前往消費。
China City -- A perfect storm EB-5 proposal in
upstate New York○VOA（2013.12.03）http://www.voafanti.com/gate/big5/www.voachinese.com/content/bloomberg-offices-in-china-20131203/1802965.html
The latest EB-5 investor visa controversy is
based on the idea of building an all-Chinese
residential and commercial development, China City of America (CCOA),
about a 90-minute drive northwest of New York City at the southern edge of the Catskill Mountains.
It would be largely financed by funds from
immigrant investors, each of whom, in turn, would get a set of green cards for
their half-million-dollar checks. It
would be on Yankee Lake, in Sullivan County, N.Y.
Unlike most EB-5 schemes, it has created a
plethora of different kinds of controversies; in fact, as EB-5 projects go, it
is the perfect storm. Everything that
could possibly be wrong with such a project is wrong with this one, in spades.
In addition to the usual critical comments about
the shaky financial prospects and dubious job-creation claims of the promoters,
which so often accompany EB-5 proposals, this one also has generated adverse
reactions because of:
- A project budget bordering on the bizarre
- Its planned ecological impact on a previously pristine rural area
- The apparently ignored need to secure environmental permits from
state authorities
- The controversial land-development records of two of the proposal’s
(non-Chinese) local allies, and
- A charge from within the Chinese community that China City
is a stalking horse for the Chinese communist government in Beijing.
Let’s look at each of these controversies in
turn, but first at a sketch of what is proposed.
The China City Plan. The first version of the plan to emerge was a grandiose one. It would
cover more than 2,000
acres (more than three square miles) spread over the
towns of Mamakating and Thompson . It would include a
Chinese theme park, a city full of China-related businesses, a high school, a
college, and 1,000 residences. Every province in China would have an office
there and the place would be replete with symbols of Chinese culture. For more
on these plans see CCOA’s website, festooned with golden dragons and text in
both Mandarin and English.1 When
finished it would be a $6 billion project, its backers say.
It sounds like a cross between the old urban
Chinatowns of the United States and the planned American communities of the
last century, such as Reston, Va., and Columbia, Md.
A revised version of the initial offering was
proposed later; this would, as a modest start to the broader project, include a
college, an urban area, some family housing, and lots of student housing; it
would cover less than 600
acres and would all be in the town of Thompson, whose
officials, a local lawyer tells me, are somewhat less hostile to the plan than
those in Mamakating. It should be noted that municipalities called towns in New
York are often rural areas and might be called townships elsewhere in America.
The description we have of this smaller version
of the China City project is from a local environmental organization, the Basha
Kill Area Association (BKAA), a pro-wetlands group that is opposed to the
development.2 It is
based on a report by BKAA activist Paula Medley Thompson officials.
Both versions would be financed, in large part,
by the EB-5 program.
EB-5-Specific Problems. As is often the case with EB-5 proposals, there
are both criticisms of the economic model and the genuineness of its
job-creation claims.
The anticipated vehicle for the investments is
the proposed China City Regional Center. It is not yet a regional center
because its application for that status — something to be decided by U.S.
Citizenship and Immigration Services (USCIS) — has yet to be approved, though it
has been before that agency for about two years. Without USCIS approval of
regional center status none of the half-million-dollar investments can lead to
green cards for anyone.
The China City Regional Center website, which
provides what information is available, is written in the most general of terms
and it is hard to tell exactly what the promoters’ plans are, but one thing is
clear: the presentation, at least in English, is (to be charitable) sloppy,
though it carries the name of a Florida law firm. The presentation in Mandarin
may be letter perfect.
The first thing one sees on the website is this
document:
Now, I do not know if the promoters are seeking
to mislead anyone, but this USCIS document is misleading by its very nature. It
is printed in the style, and on the paper, used for U.S. bonds. It looks very
official. It says in large type: Notice of Action.
But the action is that the government has
received an application from China City Regional Center LLC; if you read
the small type carefully, you’ll see:
This notice does not grant any immigration
status or benefit.
This form has often been used by fraudsters to
mislead, and for this reason some time ago USCIS redesigned it to make it
harmless, as the Center for Immigration Studies reported earlier.3 But China
City is still using the old form.
Returning to the China City website: In addition
to the questionable use of the I-797C ,
it is replete with typos, offers a wildly optimistic time-line for the
processing of the investment-related immigration benefits, and says, in one of
its Q&A’s:
How is the investment structured?
The investment opportunity is structured as a
loan with interest to be paid to the EB-5 investor.
No. EB-5 investments are supposed to be at risk,
and cannot be loans, so that part of the website should lead to a USCIS
rejection of the application — assuming the application, now secret, agrees
with the website on this point.
There are two other basic problems with the
proposal, directly related to the EB-5 program. One relates to the control of
the land and its development, and the other to the claims of job-creation.
As far as site control is concerned, EB-5
projects can move forward only when the developer has either ownership of the
land, or the possession of an option, and local government planning
approval. (Recently an EB-5 project in Vermont died precisely because of, among
other things, the lack of such site control, as was reported in the local
press.4)
In this case, it is not property control, but
regulatory control, that is at stake. The land in question seems to be owned by
a single individual, Simon Gelb, who has played a controversial role in land
development in the region, a subject to which we will return. As far as China
City is concerned, he apparently has sold an option to that group or made a
similar arrangement and has appeared with the CCOA promoters at a meeting with
local officials.
The problem is, will local officials give
permission to CCOA for its sweeping plans? Will the local planning officials
accept the high-density design for a currently sparsely populated part of
Sullivan County? For reasons outlined later in this report, such approval seems
unlikely and one can argue that trying to get people to invest in a
construction project that cannot be built because of local planning decisions
borders on fraud.
The other ominous variable for the project is
the usually contentious question of job creation. Will the program be
able to create, directly or indirectly, 10 full-time jobs for legal U.S.
residents for each half-million dollars invested? This is a statutory
requirement that has been substantially watered down by both a congressional
decision that indirect job creation calculated by “any reasonable methodology”
can be accepted and by USCIS’s generous interpretation of those words.5 But the
requirement persists and should be a real obstacle to the approval of this
plan.
In this case, the job creation requirements for
the first phase of this project come to 2,550; this is the case because CCOA
(on its website) said that there would be $127.5 million raised from 255
investors through the EB-5 program, and 10 jobs would be needed for each
investment. The total investment for this phase, from all sources, is placed at
$325 million.
Writing in the Shawangunk (N.Y.) Journal
on September 5, two local critics, Michele
Eckerson and Michael Philips
Even without access to the I-924 application
(presumably being examined in the USCIS California service center) and only
able to secure information from the website, I see several very real problems
with reaching the needed 2,550 jobs.
First, no jobs can be created directly or
indirectly through the purchase of land — that’s a long-standing (and sensible)
EB-5 rule — and there is $26 million set aside for “land cost and project
inception”.
Second, no jobs beyond short-term construction
jobs can be created by building homes for people, which is part of the
long-term plan at CCOA.
Third, much of the work to be done on CCOA is to
be Chinese-style construction and decoration. It might be hard to recruit U.S.
residents with these skills, which might cause the importation of foreign
workers and jobs for foreign workers cannot be counted in the EB-5 system as
among the 10 jobs to be created for each investment. Further, it is known
worldwide that when mainland China money is invested, there is usually a demand
that mainland China workers be employed in the project. (USCIS is not
accustomed to policing work sites to see to it that this does not happen.)
Fourth, there is the question of jobs to be
created by the introduction of the college. This is a problem because EB-5 is
designed to provide funding to for-profit organizations and if the college is a
non-profit institution, as most are, no EB-5 moneys could used to create the
college and thus no jobs could be counted as being produced by the college.
China City documents and its CEO, Sherry Li Ms. Li
So will there be a college if the project
proceeds? Will it be a for-profit or a non-profit institution? Has USCIS ever
accepted EB-5 funding for a private, for-profit college before and, more
fundamentally, is investing in a for-profit college a plausible way to create
long-term, continuing jobs (at 20 jobs per million invested)? These questions
all relate to the job-creation claims of the backers.
For a variety of reasons, then, it appears
unlikely that the goal of creating 2,550 jobs in the first phase will be met.
The Bizarre Budget. The unrealistic nature of the job creation claims is buttressed when
the CCAO budget is examined, if only briefly.7
Let’s start with the three main components of
the $325 million initial investment. In addition to the $127.5 million from the
EB-5 aliens, there is to be $132.5 million from “equity investor including the
management investment institutions and high net-worth individual” and $65
million from the U.S. government.
One wonders: What arm of the federal government
is going to put $65 million into such a project? If that money fails to appear,
what happens to the project? I could find no specifics on what agency, or what
funding source, China City had in mind.
Secondly the “management investment” mentioned
above as part of the $132.5 million shows up later in another part of the
budget as a $78 million segment of the “one-time investment”, and later,
apparently as intangible assets, also valued at $78 million. One might guess
that this is to be the developer’s expected profit.
If one subtracts both the $65 million from the
government, and the $78 million in projected profit, then the actual investment
total would be $182 million, not $325 million. Hmmmm.
The breakout of the “one-time investment” that
adds to $325 million includes such items as “28 Chinese Horoscope Signs” for $7
million, the “Temple of Heaven” for $10 million, and “Gaming City” for $24
million. What federal agency would support 20 percent of each of those
expenditures? Further, what is the likelihood of a brand new community getting
state approval for one of the few gaming facilities authorized statewide?
Other queries might be raised about such budget
items as “Soft Cost”, $2.5 million, and “Unpredictable Cost”, $9.1 million.
The budget raises serious questions about the
integrity and viability of the whole project.
The Environmental Dispute. Usually EB-5 proposals are spared ecological
controversies; they are typically construction projects such as hotels, condos,
or office buildings in urban areas, sometimes depressed ones, and no one
objects from an environmental perspective.
Not so in this case.
The local critics, Eckerson and Phillips ,
complained about potential “destruction of our environment and natural habitat
of animal life, increased traffic, and pollution”.
Similarly, the Yankee Lake Preservation
Association, an organization of residents in the Mamakating part of the project
area, has started a letter-writing campaign to head off the proposed
development for similar reasons. The focus of this group, and its very rural
setting, is conveyed in this list of subjects in a recent newsletter:8
Bears ‘n Trash, Bear Facts, Fishing Tournament
Results, Fish Stocking, and China City Update.
Among the topics that concern this organization
is the potential impact of the proposed development on “traffic, noise
pollution, effects on wildlife, water pollution runoff, light pollution, and
the use of aquifer resources”. The reference to “light pollution” got to me.
Though a term that I have encountered only in recent years, it recalled
childhood memories of the family summer place in southern Michigan, of how
completely, comprehensively dark it can be at night in an isolated, rural area,
particularly when you are beyond the last of the power companies’ wires. China
City would put an end to that at Yankee Lake!
The Needed Environmental Permits. An environmentalist anywhere in the nation can
complain about a noisy, projected development, but in New York, particularly if
it involves a wetland, the environmentalist has a formidable ally: the state
government.
There are environmental permits required from
the state government that are above and beyond the zoning and building permits
issued by, or denied by, town governments.
The state guys are on the case. On October 25,
apparently not in response to a town of Thompson request of any kind, the
Department of Environmental Conservation wrote to the town’s planning officials
about the China City proposal, saying, among other things:9
The site contains several New York State
regulated wetlands and their respective 100 foot Adjacent Areas
[these are then listed] . . . A Freshwater Wetlands Permit pursuant to Article
24 of the New York State Conservation Law will be required by this office for
any physical disturbance within the wetland boundary or within the 100 foot adjacent area.
“Physical disturbances” would be numerous in the
planned development.
The letter would seem to indicate that there is
lack of such permits — and I suspect they are not issued easily in New York —
and that this is yet another unacknowledged obstacle to the China City plans.
If there are no permits there can be no construction and, if USCIS is aware of
the problem, no approval of these EB-5 plans.
China City’s Local Allies. CCOA has, presumably unwittingly, added a little
additional excitement to the controversy by its choice of local (and non-Asian)
allies.
Following a presentation10 to the
town of Thompson planning board, on May 15, 2013, local observers said that the
CCOA team must have decided that Ms. Li’s English was not up to the challenge
so it replaced her as the lead speaker at the next such local session (on
August 28, 2013) with Thomas J. Shepstone of Honesdale, Pa. Shepstone is known
in the region as a leading defender of the controversial fracking technique for
tapping natural gas, which worries environmentalists.11
An even more controversial local ally of CCOA is
the previously mentioned Simon
Gelb Kiryas
Joel
According to the Middletown, N.Y., Times
Herald-Record:12
According to the latest round of U.S. Census
figures, released late last year [2008], the village has the highest poverty
rate in the nation, and the largest percentage of residents who receive food
stamps. Only one other place in the 50 states has a lower median income. The
median household income in Kiryas
Joel
More than two-thirds of Kiryas Joel residents
live below the federal poverty line and more than 40 percent receive food
stamps, according to the American Community Survey, a U.S. Census Bureau study
of every place in the country with 20,000 residents or more.
China City, also to be built on Gelb-owned land,
presumably would be another mono-ethnic community, as Kiryas Joel Kiryas
Joel
A Split within the Chinese Community. And then there is yet another strand to the
discussion, floating over everything else, something like the dramatic piccolo
solo in “The Stars and Stripes Forever”. It is a sharp dispute over the project
within the American Chinese community.
As background to this aspect, Falun Gong is a
widespread movement in China that combines “slow-moving exercises and
meditation with a moral philosophy”; it is outside the control of the Chinese
government, which has persecuted its followers, according to Wikipedia13 and many
newspaper reports.
The movement has American branches, including
Dragon Springs Buddhist, Inc., in Cuddebackville, N.Y., near to the proposed
China City, and an affiliate in the Washington, D.C., metropolitan area, Falun
Dafa Association.
The latter organization has, I am told by three
excellent sources, raised objections with USCIS about the proposed project as a
vehicle for expanding the influence of the Beijing government within the United
States. It has suggested that at least some of the money funneled through EB-5
investments in all likelihood originally would be from the Chinese government.
Falun Gong sees this prospect as a threat to both the security of the United
States and to that of its own organization.
Unfortunately Falun Gong — despite some prodding
from me — has not yet decided to go public with its side of the issue, which is
too bad because that would provide both additional substance and spice to an
already interesting controversy.
This proposal, in short, has many more problems
than most EB-5 schemes; in fact, it seems to have attracted a world-class
collection of them.
Let’s see what USCIS, whose leadership loves the
EB-5 program, will do with this one.
End Notes
1
See the China Regional Center website.
2
The description, from an “Action Alert”, was on
the website of Basha Kill Area Association in early November, 2013, and was
subsequently replaced with more up-to-date text on China City developments.
3 David North, “USCIS Modifies Key Form — But the PR Department
Blurs the Achievement”, Center
for Immigration Studies blog, April 2, 2012.
4
Nat Rudarakanchana, “VTDIGGER Exclusive: State Pulls Plus on EB-5
Project”, vtdigger.org, April
3, 2013.
5 David North, “The Immigrant Investor (EB-5) Visa: A Program
that Is, and Deserves to Be, Failing”, Center for Immigration Studies Backgrounder, January 2012.
6 Michele Eckerson & Michael Phillips
7
See the China City of America website and go to
“financials”.
8
See the Yankee Lake website.
9
For the full text of the letter, signed by Joseph R.
Murray
10 Mamakating News, “China City Introductory Meeting, Town Of Thompson New York”, May 15, 2013.
11 Tom Shepstone, “Natural Gas Development Saves the Farm”, naturalgasnow.org, September 29, 2013.
12 Matt King, “KJ highest US poverty rate, census says: Expert
on Hasidic communities says large families, poverty linked”, Times Herald-Record (Middletown, N.Y.),
January 30, 2009.
13 See the Wikipedia entry “Persecution of Falun Gong”.
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