McALLEN — Restaurant owner Rafael Lopez said he’s done everything the right way. The Mexican national has paid his taxes, operated and expanded a successful business, and legally employed dozens of people in his 10 years in the Rio Grande Valley.
But his status in the U.S. is under more scrutiny after a change to federal immigration law has altered renewal requirements for a visa known as the E-2. That visa, also called the treaty investor visa, allows foreign nationals to live and work in the U.S. if they are from a country that has a treaty of commerce with the U.S. — provided the visa applicants make a “substantial” investment. A number of E-2 visa holders, like Lopez, say that changes to the law create uncertainty and more hurdles for legal business owners. And if many of those business owners have to leave, advocates say, the economies of many cities along the border with Mexico could be significantly impacted.
Before changes were made in 2010, an E-2 visa remained valid for as long as five years. Now it must be renewed annually. If a visa renewal is denied, applicants must leave the country and have few options to return legally and operate their businesses here.
Lopez received his first E-2 visa in 2004 and opened La Pampa restaurant in the Rio Grande Valley. He renewed his visa in 2009 but six weeks ago was reminded that he would now have to renew his visa annually.
“It’s a huge problem. You can [renew] it by yourself, but in our case, we always hire an immigration attorney to help,” said Lopez, who now owns three restaurants. “You have to show financial statements, proof that taxes were paid, employment records. In our case, we have to show our menu.”
There is also an added layer of ambiguity. The Department of Homeland Security, not the Department of State, which issues the visa, determines how long a visa holder can remain. Though the visa must be renewed every year, it can be valid for up to two years, federal officials said.
"The one-year visa means that the individual can travel to the United States and 'knock on our door,' if you will, for the one year that the visa is valid," said Beth Fanin, a public information officer with the State Department’s Bureau of Consular Affairs. "After the traveler knocks on the door, the Department of Homeland Security decides how long the guest can stay."
The number of E visas, which includes the E1 visa specifically for importers and exporters, has risen since 2009. That year about 34,600 were issued, compared with about 50,100 in 2013, according to State Department statistics. No specific statistics for E visa holders in Texas were available.
If Mexicans who have had entrepreneurial success in Texas are frustrated with the changes, they can look to the Mexican government as a reason. The change to U.S. law followed a change to Mexican laws dealing with Americans living and working in Mexico with an FM3 visa, said Jaime Diez, a Brownsville-based immigration attorney.
“Mexico and the United States have a reciprocity when to comes to the issues of visas,” he said. “So when a U.S. citizen wants a visa to do business in Mexico, they only get one year. So the United States is going to apply the same rule for Mexicans.”
The U.S. government has also consolidated where applicants can interview with an immigration agent in Mexico: Ciudad Juárez, Mexico City and Monterrey.
“It takes six to seven weeks to review the application, then they send a letter asking for an interview,” Diez said. “I have people whose visas expired in April, the kids are in school, and suddenly they have to go to Mexico City and are stuck there for weeks.”
A denied application means applicants must remain in their country of origin regardless of how long they were in the U.S. or how much they have paid in taxes.
If the visa is not “renewed” or extended, the applicant is “out of status on the date of the renewal denial and should leave the United States in order to avoid accumulating unlawful presence,” said William Wright, a U.S. Citizenship and Immigration Services public affairs officer.
“An E-2 extension of stay application may be denied if the commercial enterprise is no longer operating, the enterprise is marginal … does not provide the investor with more than a minimal level of income and is unlikely to do so in the foreseeable future, or the E-2 investor is not developing and directing the enterprise.”
Diez said that despite the hurdles, Mexicans are still likely to try their luck and open up businesses here if they have the resources. He cited violence south of the border as one reason, though not the only one. There is no limit on how much of an investment is needed, Diez said, though the chances at getting approved are higher if the initial investment is at least $100,000.
Local economies also reap the benefits. Richard Cortez, the former mayor of McAllen and a certified public accountant, said about 40 percent of the estimated annual $13 billion in regional bank deposits are from Mexican nationals.
“You’re going to find the same thing in El Paso, in Laredo, in Eagle Pass,” he said. “And the reason is obvious: They have more confidence in the American banking system.”
Because the E2 is considered a “nonimmigrant visa,” applicants must affirm they do not intend to migrate permanently. That leaves few options for investors who wish to remain in the U.S. after they retire.
Wright said the E2 status must be abandoned if someone wants to apply for permanent residency.
“If their application for lawful permanent resident status is denied, the person will not be permitted to ‘regain’ his/her old E-2 status without first leaving the United States and subsequently seeking readmission in E classification,” he said.
Diez added that if the applicant’s children are foreign-born, they could only reside here while the parent’s E2 is valid, and only until age 21. The best option for them after that, he said, is to apply for a student visa.
Francisco Paez, who came to Texas 15 years ago on an E2 visa, is on the verge of opening his seventh sushi restaurant, part of a popular Rio Grande Valley chain called Kumori. He became a U.S. citizen after abandoning his E2 visa and applying for a change in status. He realizes it’s easier to run his business as a citizen and says he feels “more complete” after gaining citizenship. But he thinks that in the current debate over immigration reform, something should be done for E2 holders.
“In our case, we’re producing employees and paying taxes. In some form, it’s unfair that if there is a [immigration] law that is passed, someone who came here illegally pays a fine and that person is legal,” he said. “And those of us that have done everything the right way since the beginning, we don’t get the same opportunity.”