America TonightMon-Fri 9:30pm ET/6:30pm PT

For von Trapps, visa program is music to their ears

Under a controversial federal program, foreign investors can nab US green cards for investments of at least $500,000

January 28, 2015 5:30PM ET

by Betsy Kulman @BetsyKulman & Adam May @adammaytv

STOWE, Vt. — After fleeing the Nazis during World War II, the von Trapp family — yes, those von Trapps — settled in the mountains of Vermont and opened a picturesque resort nestled in ski country.

Known around the world as the musical family that inspired "The Sound of Music," one of the last surviving relatives has launched a new chapter for their famous surname: Trapp Lager.

The von Trapp family, immortalized in the movie "The Sound of Music." Johannes von Trapp, the 10th and youngest child, is pictured seated on the left.

Courtesy of Johannes von Trapp

Five years after they started making their beer, Johannes von Trapp and his son Sam von Trapp said they couldn't brew enough to keep up with demand. They were making the beer in the basement of an old barn and needed money for a new brewery. They turned to a little-known and controversial government program called EB-5.

Here's how it works: Foreign investors and their families get green cards and a chance at full U.S. citizenship by writing checks of $500,000 or more to fund an American economic development project. The project must create 10 full-time American jobs per investor. Eight-five percent of the EB-5 investors are Chinese.

“If you agree that economic growth is good for the people, then this is a good program,” said Johannes von Trapp.

Thanks to millions of EB-5 dollars from Chinese investors, the new brewery will be shockingly big. Construction is underway and has already employed dozens of workers. Once complete, the brewery will be staffed by more than a dozen full-time employees. Government estimates show EB-5 has created more than 57,000 full-time jobs since Congress created the program in 1990 and pumped more than $8.5 billion into the U.S. economy. The program has won praise from people across the political spectrum, including casino magnate and major Republican donor Sheldon Adelson and the country's premier investor and liberal icon Warren Buffett.

‘I don’t think we should be selling visas to people whose principal claim to fame is that they’ve got some money.’

David North

fellow, Center for Immigration Studies

With investment through the program, the von Trapps are able to enjoy a significantly lower interest rate than a traditional bank loan. That's particularly helpful, they said, because their brewery will likely take some time to start earning back the cost.

"So often when you have a vision, some things are more difficult to fund through traditional methods," Sam von Trapp said. "Once the brewery is up and running and has proven itself, then it can be much easier to take out a traditional loan."

But not every EB-5 program is a winner. In South Dakota the FBI investigated a failed beef plant that left EB-5 investors broke. In Missouri a zero-calorie sweetener factory that promised 600 jobs went belly up.

Johannes von Trapp as a child and today.

America Tonight

According to David North, a senior fellow at the Center for Immigration Studies, a think tank that advocates for less immigration, too many EB-5 investors blindly put their money into projects they know little about and that don't necessarily end up creating long-term jobs.

“If you put up half a million dollars in a condo for instance, you're probably building a unit," he said. "How in God's name after the construction has stopped [will] you continue to attribute 10 jobs to the building of a one-condo apartment? ... I mean, that's just very unlikely."

More oversight is needed, North said, and not by the U.S. Citizenship and Immigration Services that currently oversees the program. He added that duty is more suited to an agency like the Small Business Administration or Commerce Department.

"This is the immigration people happily running a business-development scheme," North said. "It's about as appropriate as hiring the Marines to tell us what the temperature's like in the South Pole. You need someone with climate experience."

And for many like North, the concept that the wealthy foreign nationals can skip the line for a green card is at odds with America's traditional immigration story. Chinese billionaires aren't exactly "your tired, your poor, your huddled masses yearning to breathe free" famously inscribed on the Statue of Liberty.

"I don't think we should be selling visas to people whose principal claim to fame is that they've got some money,” he said. "We have an obligation as a country to take on some refugees and some asylums. We have an obligation to let citizens marry somebody who's not a citizen. These are real obligations. I don't think that bringing in somebody with half a million dollars is an equal obligation."

But Sam von Trapp said his grandparents, who have one of the world's most famous immigration stories, would be proud of the family’s involvement with EB-5.

"I think my grandparents would think it was great given the situation they found themselves in and being forced to emigrate in the way they were," he said. "I think that they would like something that provided the opportunity for people who earned their money honestly to be able to move to a country with this much potential."