The fight for EB-5 legislation continues

What is the path, timeline, and content for regional center program reauthorization legislation? This urgent question should be directed toward advocacy groups and official advisors, not to a business plan writer and spare-time blogger. But, a few notes and resources for reference, as we find ourselves in the drama-filled month of September.

The regional center program can be reauthorized as soon as (1) there is a vehicle to which reauthorization legislation could be attached, and (2) Congress agrees to reauthorization legislation that satisfies the EB-5 industry.

The first condition — available vehicle — potentially exists now, as Congress works on major funding and infrastructure bills. The industry’s best near-term hope for legislative vehicle for reauthorization may be the omnibus Appropriations Act, which is due to be passed by September 30 before the start of every fiscal year, and which must get passed eventually. (Here’s the recent history: FY2016 appropriations (due September 30, 2015) passed in December 2015; FY2017 appropriations was delayed until May 2017; FY2018 passed in March 2018, FY2019 passed in February 2019, FY2020 passed in December 2019, and FY2021 passed in December 2020.) The Hill speculated last week that the FY2022 appropriations act due the end of this month may also be deferred to December.

When Congress misses the September 30 deadline to fund the new year, as usual, they fill the gap with one or more Continuing Resolutions, which extend the deadline on the previous year’s appropriations act. CRs by nature are smaller and more limited than an appropriations act (fewer pages), and thus less hopeful for miscellaneous additions. It’s possible that a hefty EB-5 reform bill could be attached to a CR this month, but I’d be surprised. I assume that the larger appropriations act, whenever that passes, is the industry target for EB-5. (From 2015 to 2020, regional center program authorization was not specially mentioned in CRs, but extended by default in CRs thanks to RC authorization being attached to the previous year’s appropriations. This year, a CR deadline extension would not help in and of itself, because RC program authorization is now decoupled from the FY2021 appropriations deadline.) FYI my log of past regional center program extensions includes a list of continuing appropriations and appropriations acts for the past six years, with dates and links. Note that “610(b)” or “203(b)(5)” are search terms to locate EB-5 content in a bill. (The bare minimum language needed for reauthorization is this sentence: “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 [future date] for ‘’September 30, 2015’.” An EB-5 reform bill will include a sentence similar to “Section 203(b)(5) of the Immigration and Nationality Act (8 U.S.C. 1153(b)(5)) is amended…”)

The timing for the second reauthorization condition – agreement by Congress to industry demands – is an open question. I already discussed my understanding of the field in my post Sizing the Reauthorization Hurdle. EB5IC and AAED are still committed to advance an alternative to the sub-optimal Grassley/Leahy EB-5 reform bill — an alternative that would not only reauthorize the RC program but add provisions to make the program more viable. This ambitious agenda has powered through blocking the Grassley/Leahy bill in June, seeing the RC program expire, and missing the Senate infrastructure bill opportunity.  How long will it take for these ambitions to finally be either accepted by Congress or moderated by industry? Lobbyists realize that patience is limited, and are reportedly working very hard to get Congress to agree to reauthorization soon, before investors, USCIS and Department of State give up on regional center petitions and applications. (As evidence that “the last minute” has already arrived, a USCIS leaker tells me that 154 EB-5 investors withdrew their I-526 petitions just in the last two weeks. Action is needed soon to stop the bleeding.)

I see three theoretical possibilities for the content of reauthorization legislation: (1) what industry groups including EB5IC and AAED want (legislation not yet made public, but reportedly based on S.2778 from last Congress); (2) what Senators Grassley and Leahy want, based on their S.831/HR.2901; or (3) a reauthorization that simply extends the RC program expiration deadline short-term in connection with the appropriations deadline, with no attached reform provisions. I discussed these options in detail a couple months ago in my post EB-5 legislation and the question of options (Grassley’s S.831 vs. the “holistic” S.2778). Of these, only the first appears a practical possibility at the moment.

 #3 is what we got every year from 2015 to 2020: short-term extensions to give the industry more time to agree on EB-5 reform legislation. #3 looks less probable now, since Congressional leadership went out of their way in December 2020 to decouple RC program authorization from appropriations, ostensibly to force the EB-5 legislation that’s already been deferred for five years.

#2 also seems improbable, since Senators Grassley and Leahy have not demonstrated the power to overcome industry opposition to get their reform bill passed. True, Senator Leahy can claim credit as the “driving force” for all regional center program authorizations from 2003 through 2012, and IIUSA has been willing to support the continued Grassley/Leahy reauthorization effort. But EB5IC has celebrated success in blocking Grassley/Leahy EB-5 legislation since 2015 (with other industry groups including U.S. Chamber of Commerce and the Real Estate Roundtable), and industry most recently demonstrated the will and power to block the Grassley/Leahy reauthorization path in June 2021.

So we’re left to hope that Congressional decision-makers might eventually agree with what industry groups want with reauthorization. EB5IC and AAED report that legislation is drafted and ready to go behind the scenes, though the text has still not been disclosed to the public.  (“They love the darkness better than the light because____” “…because their bill text includes no poison pills for Congress and honors promises to industry stakeholders.” Maybe.) To be fair, Grassley/Leahy also tried to get their EB-5 reform bill passed last year without disclosing it until the very last minute. This is politics, apparently. EB5IC and AAED report having secured some key Congressional support for their legislation. We shall see whether the support is sufficient to get Congress to shortly attach reauthorization to a bill that will pass.

Whether the industry effort has universal industry support may be irrelevant at this point. The main issue and question is probably just Congressional support. (One thing I don’t know: whether industry forces that have kept entire public silence this time but influential in past legislative efforts (e.g. U.S. Chamber of Commerce, Related Companies, and U.S. Immigration Fund) may exercise veto power behind the scenes. Since IIUSA’s bottom line goal is reauthorization one way or another, I think it would and could not stand in the way of any bill moving forward. But not sure about the others.) In taking control of the ball for EB-5 legislation and running with it, EB5IC and AAED are now positioned to be showered in gratitude or criticism, depending on how their play turns out.  

Note that public-facing messages from EB5IC and AAED can be found on the Pathways EB5 Vimeo site and the AAED wechat. (If anywhere else, please let me know and I’ll publish.)

Separate from the regional center program authorization issue, the EB-5 category could be affected as part of other immigration proposals being discussed now. See “Democrats make immigration case to Senate parliamentarian” (September 10, 2021) in Roll Call and “Chairman Nadler Announces Committee Print for Full Committee Markup of Build Back Better Act” (September 10, 2021) at house.gov (including link to the proposed immigration provisions). This particular immigration proposal promises limited EB-5 impact, and I’ll wait to analyze it until it makes any progress. But something like this is probably the best hope for EB-5 visa relief. EB-5 visa relief bundled with reauthoriation legislation would just make the reauthorization controversial, by making it a stand-alone immigration issue rather than an economic development issue. EB-5 visa relief theoretically has better politics and opportunity as bundled with visa relief for other visa categories that are immigration priorities for the Administration, and supported by other powerful industries. (My post from a few months ago discusses Analyzing potential changes to EB-5 visa availability.)

Meanwhile, a reminder for those negotiating for Chinese investor interests to examine examine “parole.” The prospect of parole with work authorization appears to be a key bargaining chip within the industry for EB-5 legislation, and also wreathed in hopes that do not match the highly conditional and temporary benefits in existing immigration parole programs. See the Congressional Research Service report on “Immigration Parole,” for an overview, and program details on the USCIS page for Parole for Individuals Outside the United States.

I’d also like to repeat my hope and trust that the visa-set-aide proposal has already been excised from the S.2778 template. (Set-asides meaning 3,000 EB-5 visas per year set aside for new TEA investors, and thus deducted from the pool historically leftover from low-demand countries and issued to the oldest backlogged Chinese visa applicants). Lobbyists have publicly disclaimed queue-cutting set-asides. But just in case anyone is tempted to keep pushing set-asides despite lingering visa backlogs, I suggest reviewing Shakespeare’s Richard III, Act 4 Scene 4 (start at line 210). See how Richard approaches his sister-in-law Queen Elizabeth, whose sons he has slain, to woo her daughter as his wife. Richard counts on Elizabeth’s ambition to make it work, and argues the past sacrifice can be covered by future benefit for her. But Elizabeth points out that her daughter “cannot choose but hate thee, having bought love with such a bloody spoil.” I like to think that Chinese migration agents would stand up like Queen Elizabeth, if asked to take a bloody spoil of set-aside visas to woo new investors. How wonderful if the China market could re-open with visas available for new investment! But that bright possibility must depend on visa relief not bought with visa pain for past Chinese investors. There must be good faith with past investors — not merely in intention (“but we did not mean set-asides to hurt, and we did mean other provisions to compensate” — a classic Richard III line), but in the real-world results of legislative changes. Ideally we could get backlog relief, which is essential to EB-5 program health and future. At minimum, let’s all keep responsible to avoid net backlog harm from any new EB-5 legislation. Long-suffering Chinese investors deserve good advocacy now, considering that they already committed billions of dollars and spurred creation of tens of thousands of jobs in the U.S. economy.

UDPATE: As this post ended on rather a low note, see also We’re all in this together.

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.

39 Responses to The fight for EB-5 legislation continues

  1. EB5Forum says:

    You are moving from just an EB5 blogger to a full fledged writer! Richard III, the Bible…

    I like the Scripture quote:

    John 3:19 “This is why people are condemned: The light came into the world. Yet, people loved the darkness rather than the light because their actions were evil.” In this context, Jesus is that light.

  2. Peter says:

    Quote from your blog:

    …. But EB5IC has celebrated success in blocking Grassley/Leahy EB-5 legislation since 2015, and industry most recently demonstrated the will and power to block the Grassley/Leahy reauthorization path in June 2021….

    Quote and source: https://news.bloomberglaw.com/daily-labor-report/investor-visa-groups-haggle-over-expiring-programs-renewal

    “…EB-5 Investment Coalition board member Jeff Campion, CEO of a group of regional centers known as Pathways EB-5,…”

    It means the EB-5 Investment Coalition board member Jeff Campion, CEO of a group of regional centers known as Pathways EB-5, the guy from the videos on that blog is blocking through the EB-5IC lobby the bill since 2015?

    Unbelievable… its really a “punch in the face”. How we can blame always the lawmakers/congress? Should we blame a g…. lobby?

    • There are two perspectives on this. Either blame the industry lobby for the fact that long-term reauthorization hasn’t happened yet, or thank the lobby that the RC program stayed authorized as long as it did without Grassley/Leahy’s proposed changes. Most pending EB-5 applicants would not be here today if Grassley/Leahy had changed the program their way in 2015, for better or for worse. But if the industry lobby wants to end up on the thanks side, it definitely needs legislative success soon.

      • Peter says:

        6 years… no grandfathering bill, nothing…. lets hope if they all want to keep their income as well. The interest was not for the investors, it was for the money.

  3. Peter says:

    Hello Suzanne, this is Peter „part-time-blogger“.

    Quote from AAED:
    https://mp.weixin.qq.com/s/R6_wCVpy-Lb2RbwD-XeSbg

    …We are still waiting for the exact text of the final EB-5 reform bill being drafted by the office of Senate Majority Leader Sen. Schumer (D-N.Y.)….

    You didnt mention anything about that in your latest article. Do you know something about that?

    • This is the bill that I referenced in saying “The lobbyists reportedly have legislation drafted and ready to go behind the scenes, though the text has still not been disclosed to the public.” I also look forward to seeing the exact text. Since AAED and EB5IC have worked with Schumer, they know more about the bill content than I do.

  4. Roberto Virga says:

    Ah, it’s a shakedown. It’s all clear now.
    “Under the committee print, an employment-based immigrant applicant with a “priority date that is more than 2 years before” can adjust to permanent residence without numerical limits by paying a “supplemental fee of $5,000.” The fee is $50,000 for the EB-5 category (immigrant investors). The provisions expire in 2031.”
    https://www.forbes.com/sites/stuartanderson/2021/09/13/dreamers-and-legal-immigration-changes-highlight-new-house-bill/?sh=24c419d169a9
    So, first they let the program lapse. Then they present this choice to RC investors with an approved I-526: either pay up an additional $50K and get your green card, or you don’t get a green card ever, because the RC program has been terminated.

    • Roberto Virga says:

      If they’re talking non-conditional green card (and it looks like they are), I might take them up on this offer, even though it still makes me angry. Between lawyer’s and filing fee, a I-829 application can easily cost over $20K. For $30K more, I get to skip all that.

      • waitingi485 says:

        I believe they are talking about i485 (Adjustment of Status) waiting with PD’s older than 2 years than current dates.
        But happy to be proven wrong for Conditional Green Card case.

      • Katy B says:

        This is only for backlogged countries (visa retrogression) and for Adjustment of Status, not consular processing. Unless you are China-born and already in US on non-immigrant visa, it would not apply to you, if it is ever passed.

      • Roberto Virga says:

        Sorry for replying to my post (multiple times!). Upon a more careful reading, it looks like it applies only to investors already living in the US (under a non-immigrant visa). So that’s not an avenue available to me, even if I was willing to pay that extra 50 grand.

        • Indian says:

          Yes its applicable to everyone who is lawfully present in US before 1 st jan 2021, but if they are thinking of introducing a 50 k fee they might reauthorize the regional centre program I am also a investor in pain since 3 years fingers crossed and waiting

    • Ricardo says:

      I would pay $50k to finish that history.

  5. baklol says:

    Interesting to note that EB5IC and AAED driving this. IIUSA’s no role in this is concerning. They have the biggest and oldest RCs in the industry and they are just sitting on the sidelines. Very unfortunate.

  6. Peter says:

    It applies only for backlogged countries (visa retrogression) and for Adjustment of Status, not consular processing.

    In another way: Father, got approved. Son Liu is still at the us university in New York. Son Liu can file his adjustment of status for additional 50k and doesnt need to return to Guangzhou.

    Wonderful tool for the industry to calm down father Li to continue to wait and to give the opportunity for son Liu to stay with his friends. Nice side effect: cash for the government.

    Well, EB-5 is not a recommendation business neither an Amazon product. Otherwise we could give our reviews 😂

    Beside of that interesting statistic: https://travel.state.gov/content/dam/visas/Statistics/Immigrant-Statistics/WaitingList/WaitingListItem_2020_vF.pdf

  7. Veedster says:

    I heard that a bill was submitted to the congress on Monday. Anyone knows about this?

  8. EB5swordsmen says:

    It is very funny to watch you had a conclusion on the contributions of AAED.

    It is very ironic because they are selling private equity investments to Chinese investors at the same time with their legal entity registered Beijing, this is also the entity that receives lobby donations from Chinese investors. You can see EB5sir constantly posted their Ads for the private equity investments, and at the same time, ask donations from Chinese investors to support the lobby. So, I am wondering the donations money may be misused to supporting investment sales? Which looks like a red flag and security law violation to me.

    I am also wondering a foreign donation to impact U.S. legislation may be critical and controversial due to today’s U.S.-China relationship. They also promote their previous S.2778 with the “Parole” as a universal benefit to the EB5 investors in the past, which the current DHS Head applied to Afgan refugees. I personally believe the parole will not apply to rich Chinese investors, compared to the current status of Afgan refugees.

    The Chinese EB5 investors most want to see today is a simple extension of the EB5 regional center program, nothing else, really tired of the drama of EB5 reform in the past 5 years. The Covid, the US-China relationship, the chaos of the 2020 election, and the waiting have been reached that point of collapse. So there will be more withdraws started from Oct 1st, 2021. This will also have a huge impact on EB5 stakeholders and agencies in China as well. AAED’s regional center may face the same problem of EB5 withdrawal, this is their only motive to stop that happening and push on the extension of EB-5 regional center.

    In my opinion, AAED didn’t represent the Chinese EB5 investor’s community at all, but rather a Chinese regional center principle tries to catch some eyeballs and get in touch with rich investors for its own interest, such as PE investment selling. I heard that they hired staff to control and manage the Wechat groups for suspicious behaviors, like fake investor’s comments, manipulate comments, and reading counts. A lot of innocent investors maybe get fooled. It happened before there are faking investors act real ones and ask potential Chinese investors to participate in something.

    Similar to Ira’s lawsuit to the USCIS, which facilitated 1 million dollars from Chinese investors, and in the end, it became a lawsuit cooperated with a regional center nobody heard of. And investor even hard to access the accounting books of the lawsuit. The regional center and Ira got another stunning case, but most investors who donated the money, even don’t have a name on the plaintiff list.

    There always be somebody making benefit through this “bright heroic movement of Chinese Investors”, no matter that movement is successful or not. The “Somebody” uses investors fear and dumb to create an “optimal solution”, and ask for funding, such as Ira’s lawsuit, AAED lobby.
    I am not sure what they will come up next, but definitely no withdraw and refund EB5 capital and administration fees. Every time it fails, it left real Chinese investors in limbo and more struggle, but nobody cares, the same routine in the last 4 years.

    I am really sick of it. It has been 6 years since I exposed the Jay Peak Ponzi scheme to the Chinese general public, something has changed, something never changes. And, there are huge information barriers built by purpose between what real Chinese EB5 investor really wants V.S. what they want to be represented by some self-interested groups.

    As a long-term beneficial reader of your blog, really appreciated your contribution in the last decade, if you need any material support based on my above comments, let me know and keep in touch, but please keep me anonymous.

    If you can pass my voice to more people related to this matter in the U.S., It shall provide a better understanding of the “silent majority”.

    • Thank you for this detailed comment! If you can suggest groups and venues that you consider positive for Chinese investors, I am happy to help publicize them. Also, I hope that so many Chinese investors join AIIA that AIIA will become another informed and effective force for Chinese investor interests, as a key part of the mission to advance the interests of all EB-5 investors.

      • EB5swordsmen says:

        I think you can spread the fear of withdraws, that is the most efficient way.
        Chinese investors and Indian investors are not in the same boat if EB5 keeps half a million. And Chinese EB-5 investors are in bigger numbers. But, there are no needed two organizations to represent EB-5 investors anyway, because the donation only goes to one. If you guys want Chinese investor’s donations, expose the AAED and EB5IC’s mess up is a good strategy, which is you are currently doing it.

        • I do think that there’s need for an investor organization specific to Chinese investor interests, in addition to an organization advocating for EB-5 investor interests generally. I’d like to see Chinese participating in and represented by both. A general interest organization will probably not make visa relief a top priority, as it must be for Chinese investors, and not all paths to visa relief affect investors from all countries equally. As an example of an issue that can only have separate advocacy, country cap removal would be marginal benefit for a majority of past Chinese investors, but only a minority of EB-5 investors from other countries.

  9. AAED says:

    91/5000
    As you can see, based on your blog, many Chinese investors have concluded that 1) AAED blocked the reauthorization of the Regional center program and 2) AAED pushed for the provision of 3,000 visas in draft S2778. What’s your comment on that?

    • Peter says:

      S2778 Became never law.
      https://www.congress.gov/bill/116th-congress/senate-bill/2778?s=1&r=3

      We still do not have any reauthorization until
      today. Please explain in detail!

      Whats your comment on that? And why USCIS needs a 50K fee from certain kind of backlog countries?

    • I would say those conclusions are too simple and not what I conclude from what I wrote. Certainly I wouldn’t think that AAED pushed for the visa set-asides in S.2778. My understanding as outlined in my Sizing the Reauthorization Hurdle post is that industry groups (most recently EB5IC, but at one point even IIUSA) included set-aside as a priority. EB5IC has recently clearly stated that they do not support “harmful setasides,” and nothing would make me happier than to know that today no one is for set-asides, and that the current updated version of S.2778 will not include harmful set-asides. I would love to see net benefit for backlogged investors, which I understand is the top AAED priority. Net benefit could come if a final bill does not include any set-asides, if the bill includes set-asides but they are not harmful because they are still available to backlogged TEA investors not only investors in newly-defined TEAs, or if the bill includes set-asides that do not hurt the backlog because there’s no backlog left to hurt, thanks to very substantial visa relief also in the bill. I just worry about a bill I haven’t seen, which is why I wrote this post urging AAED and others advocating for Chinese investors to be very vigilant about this at the negotiating table, as things get added and subtracted from legislation. My blogs may have erred on the side of criticism of AAED and EB5IC for resisting the Grassley/Leahy bill to hold out for an as-yet unavailable bill with more beneficial but more controversial content. Such an action is not simply blocking reauthorization, since the Grassley/Leahy bill might not have passed either regardless. But I’ve spoken critically of it as a high-stakes gamble. But is there a better way to see it? I would love to hear more of AAED’s perspectives and clarifications! I’m not on WeChat and no one has answered my emails to the address on the AAED website, so most of my info about AAED advocacy is second-hand. I would love to publicize comments for the public from AAED on its core objectives and outlook for reauthorization and potential legislative/legal/administrative changes beyond reauthorization. Just send me links to posts.

      • AAED says:

        Thank you very much for your detailed comments. Your comments are very pertinent. You said that the reauthorization clauses promoted by EB5IC and AAED may be a high-risk gamble. I agree with you, but it is a helpless choice under a specific background and situation. I am a volunteer of AAED. I will suggest that the leaders of AAED establish a smooth communication channel with you.

        • Peter says:

          @AAED

          …helpless choice under a specific background and situation…

          Why helpless? Whats not in your interest? To have audit reports? To be monitored by DHS? Please explain it here.

          Its impossible that you are helpless to explain it right now.

          • I believe this is the calculation behind the sense of helpless choice:
            The regional center program is expired = no chance at a visa
            Estimated timeline to get a visa is up to 17+ years = realistically, a lot of people probably not getting that visa
            Therefore, if RC program authorization without visa relief and no RC authorization effectively lead to the same fatal result, in terms of visa hopes, then must try for RC program authorization with visa relief, despite the gamble. This is truly a hard knot. If only a comprehensive immigration form bill aside from RC program authorization could help untie the knot!

        • That would be great, thank you! If they don’t have time to communicate with me officially, it’s also fine if you just send me links to communications that already exist from AAED, that you think help to explain the position. And then I can help to publish that side. We’ve all had a chance to hear a lot from IIUSA explaining the helpless choices behind supporting the Grassley/Leahy bill, despite its drawbacks, but I haven’t had a chance to hear as much explanation of trade-offs on the holistic side.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.