Stabilizing the EB-5 Program

The Consolidated Appropriations Act, 2021 passed the House and Senate yesterday (House amendment to the Senate amendment to H.R. 133). [Update: Finally signed by the President 12/27.] The EB-5 industry will note three significant points in this 5,593-page “Omnibus”:

  • No country cap change: The Omnibus does not include any version of the Fairness for High-skilled Immigrants Act, or any language that would change EB visa allocation or country caps. This was a close call. The next Congress will provide renewed opportunities to tackle the issue of excessive backlogs – hopefully with improved solutions that truly involve fairness for immigrants and wouldn’t simply retroactively reorder the visa wait lines.  For now, we have more time to educate Congress and the industry on unintended EB-5 consequences, and how they might be mitigated. I’m preparing a quantitative analysis that looks at issue from the perspective of different countries at various points in the EB-5 wait line (not only considering timing for the end of the line, as others have done).  
  • No EB-5 legislation: The Omnibus does not include the EB-5 Reform and Integrity Act of 2020, a belated and sadly little-noted attempt at EB-5 legislation. Neither of the co-sponsors, Senator Grassley and Senator Leahy, wrote about the legislative amendment on their websites. (So far I just found a nice mention from Rep. Brian Fitzpatrick.) I guess that few people in the EB-5 industry heeded the call to ask their Congressional reps to support the measure, considering that most of us didn’t even know it existed until a couple weeks ago and had no input into the content or process. The IIUSA Board of Directors had opportunity to deliberate on and decide to support the legislation, and made a brave but belated attempt to explain and sell the hard compromises to IIUSA members and other stakeholders. This bill was indeed an improvement on previous versions, but would have benefited from more broad-based involvement translating into wider buy-in and stronger support when opportunity arose for passage.
  • Change to regional center program authorization: The Omnibus extends regional center program authorization to June 30, 2021 – significantly, not to September 30, 2021, when the funding expires. (The extension is in Division O Title I Section 104, page 2,468: “Section 610(b) of the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 1993 (8 U.S.C. 1153 note) shall be applied by substituting ‘‘June 30, 2021’’ for ‘‘September 30, 2015.’’ ) This move finally decouples regional center program authorization from government funding. That can be good, considering how fraught the appropriations process has been, and also bad, since RC program authorization loses the benefit of inertia. Now the continued authorization of the regional center program will apparently depend on managing standalone EB-5 legislation. If you’re a regional center, pause to eat some cookies and watch the kids open presents, and then talk to your trade association/lobbyists.  Find out how you can support accomplishing legislation that will work for you, because the time is short and the stakes high. We now have a few months to do what we’ve been trying to do since 2015: get EB-5 legislation with long-term regional center program authorization and reforms that help protect and don’t kill the program. And assuming you are one of the majority of EB-5 users who’s not a fat cat and not a fraud, please also seek publicity.  Good legislation depends on changes to the popular perception of EB-5, and a better understanding by Congress of who’s using the program and how.

In order to maintain credibility, the EB-5 program needs stability. U.S. business people using immigrant investment make business decisions and execute contracts that rely on dependable estimates for cost of capital and the time horizon and rules for deploying capital. Potential immigrants invest hundreds of thousands of dollars in reliance on dependable estimates for the potential return on that investment.  EB-5 program costs, timeline, visa availability, eligibility rules, and very existence cannot be shrouded in uncertainty or subject to major volatility.  2020 has been tough, between no-notice retroactive Policy Manual updates and threatened retroactive legislative changes. The program requires better.  I look forward to changes in USCIS, Congressional, and industry leadership in 2021 and a path to more stable footing for the EB-5 program.

About Suzanne (www.lucidtext.com)
Suzanne Lazicki is a business plan writer, EB-5 expert, and founder of Lucid Professional Writing. Contact me at suzanne@lucidtext.com (626) 660-4030.

6 Responses to Stabilizing the EB-5 Program

  1. Shruti says:

    Thanks for the update Suzanne, relieved that HR1044/s386 didn’t make it into the omnibus. Any updates as to how things are at the IPO regarding pace of work or leadership changes?
    Shruti

  2. Cecilia says:

    Thanks again Suzanne for keeping us updated. Was waiting anxiously ( and loosing sleep of course) to see if FHSA made it’s way through somehow. Reading the “”close call” you mentioned I got the impression it won’t make it past the house so easily due to changes made in senate? Fingers crossed!
    Regarding the importance of long term authorization and new legislation , any tips on who I should write to explain who I am and why I chose EB5?

  3. Kim says:

    I am surprised that this post hasn’t elicited more comments. My lawyer is about to file my I-485 application any day now, and it is horrifically stressful to imagine the program expiring while my application is pending. I surely cannot be the only person in this situation.

    Thank you (as always) for your great work Suzanne throughout this year. I look forward to your insightful analysis in 2021 as well. Happy holidays!

  4. AWB says:

    US immigration policy is so absurd (and fickle in this case), even from the perspective of US citizens, irrespective of where you are on the political spectrum w.r.t. immigration. Immigrants, particularly from China, India, Vietnam and, may be, Mexico and other countries have resigned to their fate.. your mind gets more and more numb as time passes by. The political apathy is appalling!

    You know what this state reminds of… this reminds me of my childhood days in a neo-socialist state where simple tasks like requesting land records from the registry of deeds used to take weeks and months of time, bribing the officer in charge, and a lot servility to get it done. An honest person is resigned to fate for life… call it the numb middle and poor class resigned to the apathetic bureaucracy!

    No wonder Canada and, gradually, Europe are becoming more favorable places for immigrants with knowledge and entrepreneurial spirit!

  5. Katie says:

    Hi Suzanne,

    Wondering what would happen to approved I526 if EB5 regional center program be discontinued? So the regional center investors will lose their money and greencard?

  6. kishore says:

    This move finally decouples regional center program authorization from government funding – @Suzanne. Does this mean congress has to pass a bill new bill to keep RC program going or else it gets terminated on June 30th 2021 and everyone who does not have green card but a pending I-485 will go into tailspin unlimited wait time until congress gets its act together. So unlimited delay

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