Perspective on reauthorization and S.831

This week IIUSA held a Leaders Advocacy Summit to help explain and build support for efforts to reauthorize the regional center program in advance of its June 30, 2021 sunset date. Particularly, the summit focused on the only active reauthorization legislation to date: Senator Grassley and Senator Leahy’s S.831 – A bill to reauthorize the EB-5 Regional Center Program in order to prevent fraud and to promote and reform foreign capital investment and job creation in American communities.

The IIUSA Leaders Advocacy Summit recordings are available for free. I recommend them for extensive primary-source information about what’s happening now with EB-5 legislation, and what we can do.

• The panel “Capitol Hill Update and IIUSA Advocacy Strategy” features commentary from IIUSA’s lobbyists. They discuss the process that resulted in the currently-proposed Grassley/Leahy bill, potential hurdles, milestone goals for the coming weeks, and influencing key decision-makers in Congress. The lobbyists acknowledged that EB-5 legislation is unlikely to get floor time as a stand-alone bill, but will depend on getting sufficient endorsements, co-sponsors, and attention that key decision-makers can recognize its importance and popularity and agree to attach the EB-5 bill to other legislation.
• The panel “Congressional Staff Roundtable” allows us to hear directly from the staff at Senator Grassley and Senator Leahy’s offices responsible for the proposed EB-5 legislation. They give interesting insights into their senator’s priorities and hopes for the bill, and practical considerations as the bill moves forward in the legislative process.
• The panel “EB-5 Legislation Review” gives an expert-guided tour of the text of S.831. I was interested to hear the panelists’ insight on what is and isn’t an actual change from current practice/existing law, and what resulted from IIUSA negotiation or remains in place despite negotiation. At least, S.831 is an improvement on previous iterations of Grassley/Leahy EB-5 legislation. For people struggling for reasons to support S.831 for what it contains, not just what it represents, this panel’s in-depth analysis offers some help.
• Other panels discuss media strategies and regional center reactions to the bill.

Hearing the IIUSA speakers struggle to present S.831 as a good bill reminds me of us last year trying to feel good about our presidential votes. S.831 is the Joe Biden and Donald Trump of legislation. Whatever happened that the choice came down to this? How many of us voted in last year’s election with a bitter taste, not for our candidate so much as from a calculation of alternatives? And that’s where I am with S.831. The bill is not well designed to accomplish its objective “to prevent fraud and to promote and reform foreign capital investment and job creation in American communities.” It does not address the factors that have depressed investment and stymied job creation. Its impractical reforms would help deter good use of the program (by making it exclusive to the few who can afford all the fees and red tape) and undermine USCIS accountability (by deferring judicial review) as much as deter fraud. S.831 will not make the regional center program work as intended — the truly needed changes will have to come in another bill after S.831 addresses the immediate reauthorization crisis. S.831 is only a stopgap, since a mere five-year authorization will not even cover the existing regional center backlog through the visa stage, much less provide needed stability for new investment in an environment of multi-year processing and visa waits. But I support S.831 because I must have some vote against the alternative, which is to allow the regional center program to lose authorization after June 2021. Supporting S.831 appears to be my only chance to vote against betraying the in-process EB-5 investor applicants who depend on on-going regional center program authorization to get visas, and to avoid undermining the projects deploying their billions in investment. And the negative way Grassley and Leahy frame S.831 – as a bill to solve problems and reduce risks, not as a bill to support immigrant investment – is plausibly the best way to make it uncontroversial in Congress and get reform+reauthorization a chance at passage.

Last Fall, I spent a moment with pen hovering over my presidential ballot, wondering if I could make myself feel better by writing in Joe Neguse. But I admitted that would be false comfort. And now too in the EB-5 legislation context, supporting a positive but nonviable option could be counterproductive. Consider the low probability of a significantly renegotiated S.831 (what we’ve got is already the fruit of six years of industry negotiation with Senators Grassley and Leahy), a bill that gives visa relief (who thinks that Schumer and Pelosi would dare be seen to help immigrant investors right now, while kids at the border, DACA, etc. remain unresolved?), a bill with investment amount/TEA changes (such a bill doesn’t exist yet, and would be a long shot if it did since the Biden Administration just ratified the regulations, and reducing the TEA incentive would look controversial to Congress), or another indefinite series of short-term extensions (an option that was already tenuous over the past six years, and which Congress apparently intentionally took off the table when it gave the RC program a new mid-year sunset date). I would love for someone to give me reason to hope for and way to support one of these alternatives. From my armchair, I do not see the realistic path around S.831 to get to reauthorization. But IIUSA, at least, sees alternatives in the path after S.831.

If my future business would be dead without RC program authorization, but equally dead if S.831 passes, why not gamble on holding out for a third alternative, however improbable? But gamblers must remember that someone else does have something to lose: tens of thousands of EB-5 investor families whose future immigration hopes depend on on-going regional center program authorization. S.831 is a bird in the hand that could protect them in the near-term, at least (and protect the projects that don’t want to be abruptly besieged now by tens of thousands of anxious/disappointed investors). We have a responsibility to these constituents — and should recognize that their public future success or failure affects our interest as well. Therefore, I have added my name to  https://www.saveandcreatejobs.org/members, where it can be used by lobbyists to help create the impression of support and enthusiasm that the Grassley/Leahy reauthorization bill will need to pass. And I encourage other industry stakeholders to do the same. Ah, democracy.

Note that I continue to update my Reauthorization page and Washington Updates page on an on-going basis, to avoid cluttering the blog feed.

I shall end this post with a bit of history, as context for how we got where we are today: My log of EB-5 legislative proposals 2015 to 2019, and my chart of regional center program authorization history.

And finally, because this reminder can’t come too often, the last count (from Charles Oppenheim in November 2020) of EB-5 investors and family still at NVC or USCIS without visas yet. The tens of thousands of regional center investors in this count will not be a happy constituency if the regional center category becomes “unavailable” in the Visa Bulletin — which will happen automatically starting July 1, 2021 unless and until the regional center program is reauthorized.