Green Room

McAuliffe firm a “visa-for-sale” scheme?

posted at 12:19 pm on April 11, 2013 by

According to e-mails at the Virginia Economic Development Partnership (VEDP) released through a FOIA request, that was the concern when Terry McAuliffe attempted to get government investment in his GreenTech Automotive.  Stung by criticism that he had moved jobs outside of Virginia, the Democratic gubernatorial candidate claimed that the state wouldn’t cooperate with GreenTech.  Internal communications demonstrate why, Jim Geraghty writes at NRO:

“We had sites, we had meetings, and they chose that they weren’t going to bid on it,” McAuliffe declared. PolitiFact looked at the paperwork and rated that assertion false, concluding that “VEDP asked GreenTech to address its concerns and waited in vain for replies.”

But internal communications from VEDP now reveal that the state agency didn’t merely think that McAuliffe’s company had a risky business model. At least two high-ranking officials actually suspected that the company’s real aim was to make money by selling U.S. residency visas to wealthy foreigners.

In an e-mail dated November 17, 2009, Liz Povar, then the director of business development at VEDP, wrote to her colleagues:

Sandi et al. Even if the company has investors “lined up”, I maintain serious concerns about the establishment of an EB-5 center in general, and most specifically based on this company. Not only based on (lack of) management expertise, (lack of) market preparation, etc. but also still can’t get my head around this being anything other than a visa-for-sale scheme with potential national security implications that we have no way to confirm or discount. . . .

This “feels” like a national political play instead of a Virginia economic development opportunity. I am not willing to stake Virginia’s reputation on this at this juncture. 

The e-mails were revealed pursuant to a Freedom of Information Act request filed by PolitiFact; 79 pages of documents were posted online in January.

Before the Mississippi Development Authority, a state agency, loaned GreenTech $5 million to help get started and buy the land for its production facility in that state, the company sought assistance and incentives from Virginia. High on its list of priorities was the establishment of a “Regional Center” to help attract foreign investors who would also be interested in obtaining an EB-5 U.S. residency visa.

The term “sale” is not quite literal, Jim explains:

While the Regional Centers are not allowed to sell the U.S. visas, they are allowed to point out that investment in their projects may qualify a foreign citizen for a residence visa, and they may appear to suggest that one directly leads to the other. For example, at the top of the website for Gulf Coast Funds Management LLC, the Statue of Liberty’s torch is next to the slogan, “Invest in your future with EB-5.”

One of Gulf Coast Funds Management’s current clients is . . . GreenTech Automotive.

Povar wasn’t alone in her concerns at VEDP:

About an hour after Povar sent her e-mail, Roy Dahlquist, the international-investment manager at VEDP, replied, “Liz, please note that I agree with your observations and opinions on this subject.”

Dahlquist elaborated on his concerns in another e-mail the following day:

The executives involved with this project are not selecting Virginia based on its business value proposition. They are not evaluating Virginia based on the long term success of the company, its employees and the community partnership in general. They are choosing Virginia because we are the #1 best state for business and they are using our recognition as a selling tool to easily raise funding.They are also using our current political “opportunities” to rush this process prior to a new administration taking office.

At the time of that message, Republican Bob McDonnell had just won the state’s gubernatorial election and would be sworn in in January 2010.

It’s worth pointing out that VEDP’s suspicions aren’t proof that this was McAuliffe’s intent, but it’s certainly worth reading all the way through.

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