Changes from DHS and/or Congress? RC List Updates
June 10, 2016 4 Comments
01/11/2017 Update: USCIS published an Advance Notice of Proposed Rulemaking “EB-5 Immigrant Investor Regional Center Program” (Docket No. USCIS-2016-0008) and Notice of Proposed Rule-making EB-5 Investor Program Modernization (DHS Docket No. USCIS 2016-0006).
How close are we to getting the revised EB-5 regulations promised by USCIS? My best guess is: pretty close — at least by Spring 2025. The rulemaking process for a federal agency (according to Wikipedia) goes like this:
- give advance notice of proposed rulemaking
- publish actual proposed regulatory language (“notice of proposed rulemaking” or NPRM) in the Federal Register
- public comment period, which may last 30 to 180 days or so
- if comments precipitate drastic revisions, a second draft may be published in the Federal Register for further comments
- the proposed rule becomes a final rule, with minor modifications and full response to comments submitted by the public
- the final rule becomes effective (with most rules becoming effective some time after initial publication to give regulated parties time to come into compliance)
So far, DHS has accomplished Step 1 in this process for new EB-5 regulations, publishing Rule 1615-AC07 in the Office of Management and Budget’s Spring 2015 Rule list (and reposting in Fall 2015 and Spring 2016). The 2015/2016 OMB notice indicates general content areas for revision to EB-5 regulations: create distinct regulations for direct and regional center investors; and make changes to regulations for the designation of Targeted Employment Areas, indirect job creation, the required investment amount, material change’s effect on conditional residency, the regional center designation process, and monitoring for regional center compliance. USCIS held a stakeholder meeting and online feedback session on possible revised regulations in April 2014 and again in April 2016. But that’s all still Step 1, and we have no indication of when the process could progress to Step 2 and beyond. [UPDATES: DHS Secretary Johnson testified on 6/30/2016 that he foresees progressing to Step 2 as early as November 2016. IPO Chief Nicholas Colucci said in the 8/29/2016 EB-5 Stakeholder meeting that his office was actively working on the regulation but had no timeline for publishing it. The Fall 2016 OMB list notice gives a target date of 01/00/2017 for Notice of Proposed Rulemaking]
The entire rulemaking process could theoretically happen within a year, and there’s been plenty of talk about its urgency, but I’m not holding my breath. For context, the regulation dealing with EB-5 petitions approved 1995-1998 (RIN 1615-AA90) has appeared as a proposed rule the OMB agenda biannually since 2003, the proposed regulatory language was finally published in the October 2011 Federal Register, the public comment period was completed in November 2011, and the rule entered the final stage March 2015. It remains to be seen whether the promised new EB-5 regulations can be promulgated in less than thirteen years. We’ve heard since 2014 that USCIS is actively working on them, so two years down, at any rate.
If USCIS drags its feet on regulations, it can also make changes by publishing new policy. For example, you can now provide feedback on a new Interim Policy Memo on the topic (not EB-5 specific, but relevant to EB-5 applications and petitions) of Signatures on Documents Filed with USCIS. (UPDATE: In the 8/29 EB-5 Stakeholder Meeting, IPO reported that they are currently compiling existing policy for the EB-5 chapters for the USCIS Policy Manual, and expect to issue future new policy as amendments to the manual.)
How close are we to getting new legislation that affects EB-5? The tidbits and rumors I hear suggest (1) that we’re unlikely to see a substantial reform/reauthorization bill before September 30, considering the few Congressional workdays left and the election, (2) that substantial reform legislation is still in active discussion (Grassley and Leahy staffers met just last week with securities attorneys to discuss a forthcoming edition of the S.1501), (3) that the regional center program will probably get another clean short-term extension beyond September 30, 2016, to give more time for substantial legislation, and (4) that the next short-term extension is likely to be genuinely short, considering that the leaders motivated to insist on urgent program changes have even more ammunition and motivation than they did last year.
The House has a couple new bills with some relevance to EB-5. H.R.5203 – Visa Integrity and Security Act of 2016 would tweak the application and review process for all visa categories (not EB-5-specific, but could affect some EB-5 investors). The EB-5 Insights blog has a summary of key provisions, if you’re interested but don’t want to read the bill. H.R. 5398: Immigration for a Competitive America Act of 2016 doesn’t mention EB-5 but proposes to increase the total number of employment-based visas from 140,000 to 253,000 (+81%), which would effectively increase the EB-5 visa allocation by 81% as well. As of now the bills haven’t gotten far and GovTrack rates them at 0%-3% chance of being enacted, but FYI the proposals are out there.
Regional Center List Updates
Additions to the USCIS Regional Center List, 05/23/2016 to 06/10/2016
- Deictic Investment Group – California (California)
- Onefire Healthcare Services, LLC d.b.a. Onefire Regional Center (Oklahoma)
- Texas First Regional Center, LLC (Texas)
- Texas Regional Investment Center (Texas): www.texasric.com
- West Bridge Regional Center, LLC (Texas): www.westbridgeregionalcenter.com
No longer listed:
- TriHaven Investment Group Southern California (California)
- Palm Beach Raceway LLC (Florida) Terminated 5/31/2016