EB-5 Benefits – The CMB Business Model

EB-5 Benefits with the CMB Business Model

The formation of CMB Export, as originally constituted, was intended to assist California communities in creating new American jobs in those specific areas which have experienced the devastating economic effects of military base closures due to the determinations of the Federal Base Realignment and Closure Commission (“BRAC”). The original CMB Export geographic scope included the counties of San Bernardino and Riverside in Southern California and the county of Sacramento in Northern California. The business or operational focus of the CMB Export Regional Center designation was the rehabilitation to civilian use of the closed or realigned military bases and the areas in which they reside.

The military bases named in our original CMB Export Regional Center were George Air Force Base, Norton Air Force Base, Mather Air Force Base, Sacramento Army Depot, McClellan Air Force Base and the realigned March Air Force Base. The CMB plan was to focus on communities that contain closed or BRAC-affected military bases and helping those same communities create new American jobs. Each of these communities have experienced the economic devastation of losing the jobs and commerce the military bases formerly provided to the areas for decades. Later, CMB decided to apply the lessons learned in the initial military base revitalization to all California communities and public and private partnerships. Since initial designation, CMB’s business model in creating new jobs has been concept-driven rather than industry-driven.

The concept-driven business model with an emphasis on infrastructure development was undertaken by CMB and its EB-5 investment partnerships for several reasons. Former military base communities faced numerous challenges to rebuild or reinvent their economy. Each former military base had old military infrastructure that would not meet current modern standards. Most former military bases are faced with environmental problems, such as asbestos abatement, contaminated water tables and other significant environmental remediation impediments. Often, demolition is the first step towards infrastructure improvement. Infrastructure is the backbone of community development and provides the foundation upon which all economic activity and job growth are based. Infrastructure costs frequently are the single largest obstacles to creating new jobs and increasing regional productivity in any community development plan. CMB EB-5 investment capital helps communities balance several factors that influence both the timing of infrastructure requirements and available revenues to fund them. CMB EB-5 funds have been used in the following manner to address the challenges stated above:

EB-5 Benefits With CMB:

The CMB business plan approach is simple. EB-5 Benefits with CMB EB-5 partnerships enter into a six-year loan that requires interest only payments. Depending on the particular project, these loan agreements are with Government Agencies, public/private partnerships or private developers. CMB EB-5 funds are combined with additional public and private funds to finance the construction of a specific project or projects. The benefit of this early-stage “seed” financing is to jump-start the activity of infrastructure construction, improvements, or repair in the absence of other reasonable funding sources. The timing and resources necessary to complete each project will vary depending on the nature of the project. Some projects are one-time events with a single participant, while other projects are multi-phase long-term projects. The availability of early-stage alternative financing for infrastructure and construction projects initiates a chain reaction of economic development that results in significant new American job creation.