[D]OVER — Mount Snow administrators say the federal government has approved the resort’s EB-5 foreign investment program, and they’re hoping that signals the imminent release of $52 million raised for snowmaking and lodge upgrades.
Funding for Mount Snow’s Carinthia LP project has been held in escrow while U.S. Citizenship and Immigration Services reviewed the resort’s plans and its foreign investors’ visa petitions.
Administrators announced this week that the first part of that review is complete and immigration officials have given the nod to the resort’s EB-5 project as a whole. Though further federal review is required before the $52 million is released, Mount Snow parent company Peak Resorts expressed optimism that the EB-5 effort finally is moving in the right direction.
“It is a positive step. It’s a positive move forward,” said Renee Ketels, an investor relations spokeswoman for Peak Resorts.
No further information was available from the federal government regarding Mount Snow. A Citizenship and Immigration Services spokesman on Thursday said that “as a matter of policy, we cannot comment on specific EB-5 projects.”
The federal EB-5 program allows foreign investors to gain permanent residency by contributing to job-creating projects in the U.S. The minimum EB-5 investment required in a federally designated “targeted employment area” like Mount Snow is $500,000.
Resort administrators have raised $52 million via the EB-5 program to fund Carinthia LP, which consists of the West Lake snowmaking project and Carinthia Ski Lodge. West Lake is expected to give Mount Snow six times the water storage capacity it currently has, and the new 36,000-square-foot lodge is to include a cafeteria, restaurant, two bars and a coffee counter.
Although lodge construction has not begun, the West Lake project is under way. But the resort’s EB-5 development has slowed to a crawl while administrators have waited for required federal approvals and the release of foreign funding.
Peak Resorts has blamed the delay on a “growing review backlog” at the federal level — a backlog that, according to immigration service statistics, has resulted in more than 20,000 pending visa petitions related to the EB-5 program.
Peak Resorts said it has already sunk more than $12 million into the Carinthia LP projects. That money is to be reimbursed when Mount Snow’s EB-5 funding is released, but company officials have acknowledged the delays have caused financial strain.
So this week’s federal approval of the Mount Snow EB-5 program is a good sign for Timothy Boyd, president and chief executive officer of Peak Resorts. “We are pleased that we received the EB-5 project approval and look forward to the funds being released from escrow soon so that we can resume our Mount Snow development projects,” Boyd said in a statement Wednesday.
Peak Resorts doesn’t have the money just yet, as federal officials have not completed review of an I-526 immigrant visa petition related to the project. Resort administrators noted in Wednesday’s announcement that “the related $52 million in funds raised from investors … will be released from escrow immediately following the approval of the first I-526 petition submitted by an investor in the Mount Snow EB-5 offering.”
The company also asserted that, “historically, the petition approvals occur shortly after program approval.” But Citizenship and Immigration Services did not confirm that, and Ketels said she couldn’t speculate on how soon the federal review might be finished.
“We really don’t have a more specific time estimate,” she said.
The EB-5 program has come under scrutiny in recent months after federal and state authorities alleged a $200 million “Ponzi-like scheme” in Vermont connected to EB-5-funded activities at Jay Peak resort and in Newport.
But Mount Snow representatives have stressed that they have no connection to Jay Peak. “It’s important to know that we are in good standing with the state of Vermont,” resort President Dick Deutsch said last month.