Understanding the Audience: Senator Leahy
November 3, 2021 50 Comments
The FY2022 Appropriations Act is the nearest-term hope as a vehicle for regional center program authorization, and I hear that all sides are committed to grasping that opportunity. (The appropriations act is due by December 3, 2021, and could well be delayed by Congressional fights unrelated to EB-5. But I’m relieved to hear that EB-5 negotiators are not counting on delay, but still hustling to be ready to catch the opportunity as soon as it could possibly come.) The appropriations opportunity focuses attention on Senator Leahy, who has a gatekeeper position as Chairman of the Senate Appropriations Committee. What are Senator Leahy’s interests and motivations when it comes to EB-5 legislation?
Senator Leahy is a long-time regional center program champion. His website celebrated in 2013 “Senator Leahy was the driving force behind every reauthorization since enactment.” He is also passionate about program integrity and reform, and long instrumental in EB-5 legislative efforts. The successes and difficulties of Vermont Regional Center have colored his efforts. Over the decades, Senator Leahy has published thousands of words about his EB-5 interests. I’m sharing below notes that I made when reading articles tagged with the “EB-5” category at leahy.senate.gov. I hope that reviewing Senator Leahy’s perspective can help shape advocacy that’s responsive to his priorities.
Senator Leahy’s EB-5 perspective as expressed in articles posted at leahy.senate.gov
Regional center program authorization
- Committed supporter of long-term regional center program authorization with reforms
- 7/22/2009: “For years this program has been reauthorized on a temporary basis. Currently, it is set to expire at the end of September. Making this program permanent is a critical first step to its continuing success. …I also remain committed to considering changes to improve the overall program. … I hope that this hearing will initiate a dialogue about how Congress, the agency and stakeholders can work together to ensure that the goals of job creation and security can be met, and at the same time make the program as effective and efficient as we can for those who are developing projects in communities around the country. I strongly believe this program has the potential to grow as a meaningful source of positive economic development around the United States.”
- 9/28/2012: “I appreciate the President’s support for this bill and the support we have drawn from both sides of the aisle. The president’s signature on this bill is one more step toward my goal of a permanent charter for the EB-5 program, along with additional measures to give U.S. Citizenship and Immigration Services (USCIS) the tools it needs to keep this program a strong, secure and vital part of our economy.”
- 12/4/2015: “The Regional Center should be reauthorized, but only if reformed. There is now bipartisan consensus around these reforms, and we cannot squander this opportunity.”
- 12/08/2016: “I believe we can still fix EB-5. But I cannot support simply extending it, yet again. While I do not come to this decision lightly, I cannot support a continuing resolution that leaves these flaws in place. The time has come to reform EB-5, or to end it.”
- 01/12/2017: “I remain committed to protecting investors and rooting out the rampant fraud within the program. If we cannot take these critical steps, I believe the time has come for the program to end.”
- 9/25/2019: “We are hopeful that Congress will finally take decisive action to address the fraud and other vulnerabilities that have come to define this program.”
- 6/25/2021: “Now that our bill has been blocked, the EB-5 visa program is unfortunately going to lapse in the days ahead and have untold economic consequences throughout the communities that rely on the program for development projects. I remain committed to reforming the EB-5 program should there be another opportunity to do so.”
Integrity Measures
- Promote accountability and transparency
- Prevent fraud and address national security vulnerabilities
- “Improve accountability of applicants, project managers and the projects themselves”
- “I remain committed to doing more to protect investors and to root out fraud within the program, such as increasing fraud investigations and requiring additional oversight of investor funds.”
- “Our proposal would require background checks and third party oversight of funds. It would create protections for defrauded investors. It would ban foreign government ownership of an EB-5 company.”
- “Congressional action is required to rectify documented fraud and national security vulnerabilities within the EB-5 Regional Center Program. The bipartisan EB-5 Reform and Integrity Act of 2021 establishes new disclosure requirements for EB-5 regional centers in order to protect investors and certify regional center compliance with program rules. It also requires the Department of Homeland Security to perform regular audits of and site visits to regional centers.”
- “I will not support mere window dressing. Proposals that do not require transparency and accountability for every EB-5 project are just that.”
TEA Incentives
- Protect “central purpose of promoting investment in rural and economically challenged regions” by “reining in abusive gerrymandering”
- “The incentives that Congress created to promote investment and create jobs in rural and high unemployment areas—the sole reason why I championed this program—have been rendered obsolete through economic gerrymandering.”
- “The fact that a luxury hotel in Beverly Hills can use gerrymandering to claim it is located in a distressed community is troubling. But the fact that this type of abuse now represents almost 90 percent of the entire EB-5 program is appalling. And an untold number of these luxury developments would be pursued regardless of EB-5 financing, casting doubt on whether the program is creating any jobs at all.”
Investment amounts
- Modernize EB-5 by providing “a much-needed increase” to “inadequate investment levels.”
Visa Relief
- (The website posts do not discuss this topic. Leahy’s co-sponsored bills have included age-out protection and concurrent filing. He has spoken warmly about the general goal of protecting investors, but not discussed EB-5 visa relief.)
Industry Prejudices
- “Small but powerful corporate interests must not be allowed to derail improvements that can help our most distressed communities. They must not be given credit for window-dressing reform proposals that do little to change the status quo.” (2/2/2016)
- “Gluttonous, shortsighted corporate greed blocked these critical reforms. Greed that was given a voice by the U.S. Chamber of Commerce. Republican leadership has allowed a couple of powerful developers who exploit this program’s flaws to derail critical reforms. I find it shameful: the worst abusers of this program have been given veto power over its reform.” (12/08/2016)
- “It’s really unfortunate that a bipartisan bill supported by the overwhelming majority of EB-5 stakeholders was blocked at the behest of a small minority that blindly opposes much-needed accountability and transparency in the program.” (6/25/2021)
This history can be a resource for people speaking with Senator Leahy today. Assuming industry can’t all to agree to just ask Leahy to attach Leahy’s own proposed EB-5 reform bill to FY2022 appropriations (of if only!), let’s at least carefully frame the alternative proposed EB-5 legislation in Leahy’s terms. Show him how any alternate TEA provisions and integrity measures still check his priorities for distressed and rural areas, accountability, and transparency. Identify and preemptively concede any proposed language that projects the opposite message. Discuss the integrity measures that likely mean much to Leahy in light of the Vermont RC case: fund administration, investor reporting, and regional center audits (previously not included in the industry bill). In choosing the advocacy approach, be cautious to navigate Leahy’s unfortunate image of parts of the industry. Speak to his goals, commitments, and existing knowledge. I trust that negotiators are being smart and strategic, and thinking in terms of audience. We can maximize the FY2022 appropriations chance by presenting language that makes Appropriations Chair Leahy able to respond “yes, this is something I want to help advance because it addresses my priorities and will help to protect my legacy in EB-5 and my reputation in Vermont.”
EB-5 Updates 
You are the best, thanks for all your efforts.
Thank you
Thank you.
Thank you. I love your words and way to address the matter.
Thank you.
I interacted with him on facebook and i hope he”ll help us.
Thank you so much.
I have sent a message to the Senator in which I remind him how it is important for us (EB5 investors) to get heard and be respected, but not put aside by the immigration process.
I hope our voice will be heard. Investors should be protected from the current expiration.
Are we in that infrastructure package?
$100 billion for immigration. This is part of the framework, but also separate since it requires a ruling by the Senate parliamentarian. This would constitute an investment to reform the immigration system, reduce backlogs, expand legal representation, and make order processing more efficient and humane.
Attended IIUSA’s Legislative Update panel today during the ongoing virtual conference. They seem to be highly confident and almost sure (note I didn’t use the word optimistic) about reauthorisation in Dec… They seem to have worked hard to make sure that all stakeholders are well aligned to the proposed bill language. Wonder if there is any catch? Any different points of view from anyone who sat through the update, or heard anything differently?
I missed the conference. AIIA said that is is unlikely for reauthorization in Dec. They hope to have a chance to include the reauthorization in March? https://goaiia.org/blog/f/newsletter-5—reauthorization-not-expected-until-next-year
I’m not sure who to believe at this point.
Very sad with a lot of uncertainty.
Very unfair for investors who have invested in America to create jobs for years before the expiration.
You should watch the replay of the panel by applying to watch the rest of the conference. It’s all free for investors… FYI, the panelists were truly confident – they even politely pooh pooh-ed AIIA’s blog which states that it’ll go into next year. They shared a lot of the detailed (hard) work they had done for alignment. And they felt it could be attached to either the FY-2022 Appropriations or the Continuing Resolution in case Appropriations is not finalised by Dec 3… let’s wait and watch…
Oh Ok, thank you very much. Best news in these days! Hope there will not be any depressing news later on! Yes, I trust IIUSA because they are the center of negotiation and reauthorization. They are the people who actually worked on the issues. We all understand that they worked hard, no question about it. But the reauthorization depends on so many parties.
In my opinion, regardless of reauthorization, USCIS should continue to process the previous I-526s. They treat investors badly while surrender illegal immigration.
Not to spoil the party, but mixed opinions everywhere:
https://www.forbes.com/sites/andyjsemotiuk/2021/11/08/which-way-forward-on-eb-5-investor-immigration-program/amp/
Don’t completely rely on AIIA they are just trying to take advantage of current scenario they are just like IV
Hi Geerish, I am the founder of AIIA and an EB-5 investor like you. We created AIIA in April because several of us investors and industry insiders knew this lapse situation was going to happen months before. Please go through our blogs and videos on YouTube and you’ll see for yourself that we’re just a group of investors trying to advocate for our own community.
Unlike IV, we’re only trying to advocate for a simple, common sense piece of legislation.
Have been following the work AIIA is doing, they have done some very good work, I don’t think they are like IV
They are always sure and positive to reassure there members. They were confident that the program wouldn’t laps this long but it did. However my take away from watching the video was that they are working as if Dec 3rd is the deadline. They don’t actually know when congress will actually pass an omnibus. I would seriously temper my expectations about re-auth coming on dec 3rd. An Omnibus bill is unlikely to pass this year due to so few days left and no agreement between parties. Additional legislation is not likely to get attached to a stop gap funding bill like IIUSA is implying or trying to do but I could be wrong. Only stuff like disaster relief gets attached to stop gap funding bills.
https://mp.weixin.qq.com/s/iKqb9esidEZU1zwQ8iFHjg
Latest from Jeff Campion https://vimeo.com/644405434
Well…should we send selfies to the senators 😂 ? I appreciate the video, but its like a weather forecast. Still i wouldnt recommend anyone to invest a penny. By the way… why he doesnt name the bill? Is there no new one? Why HR2901 has moved to the subcommittee by end of October?
Jeff Campion, shouldn’t have posted that clip. He said nothing about nothing. Just mouthfuls of useless words.
@Veedster,
I agree. However, giving credit where credit is due, I think he is the only top player in the regional center industry that is visible during this critical time. And for that, he deserves my respect. He is not afraid of addressing this disastrous situation directly while his peers have disappeared. The CEO of my regional center appears to have been abducted from the face of the earth (of course, he didn’t leave without leaving his minions urging new investors to do their due diligence as to be ready for the moment the program is reauthorized).
Despite being an extremely optimistic person, it’s hard not to be distrustful as we have a history of disagreement between the various factions of the EB-5 industry.
A “covet all, lose all” mindset brought us here, so skepticism is warranted based on the industry negotiation track record with Congress.
Even though they’re now apparently aligned, the question is, “Will they stay aligned once they listen to Congress feedback on their consensus bill? Perhaps the survival instinct kicks in this time…
Still, the above assumes they’ll be able to overcome a track record of broken trust between industry and several members of Congress.
So, it is against this backdrop, plus a Congress more divided than ever, that our dreams and destinies are to be decided. That’s the reason I believe grandfathering is our best chance. May God have mercy on investors who have invested life’s savings in good faith!
Lastly, it would be funny if it weren’t tragic, that an industry that moves billions of dollars, are now relying on investors phone calls and emails to Congressman staff to influence reauthorization. Of course, I believe phone calls and emails do no harm, but for me this is just a deceitful strategy to reverse the responsibility and be able to say that investors didn’t do their part in the event the reauthorization doesn’t pass. It is pathetic, to say the least. Remember folks, the industry has long been paid royally to secure our (and their own) interests in Congress via lobbying. It’s their fault… it’s their responsibility. They brought us here.
They all knew it. They had to accept HR2901 few months ago. But the industry wanted something else. There is nothing else than HR2901. Now the industry need to twist the story. Thats happening if someone wants more: you get nothing. „Good luck with the lost investments and have fun to explain it“. I am sure this was the answer from the lawmakers. Lets look forward now. Soon its reauthorized with HR2901 under the rules of the lawmakers, not „the industry“.
Thank you, Peter.
I read the SEC section with interest.
“(i) IN GENERAL.—The Secretary of Homeland Security may not permit any person to be involved with any regional center, new commercial enterprise, or job-creating entity if—
“(I) the person has been found to have committed—
“(aa) a criminal or civil offense involving fraud or deceit within the previous 10 years;
“(bb) a civil offense involving fraud or deceit that resulted in liability in excess of $1,000,000; or
“(cc) a crime for which the person was convicted and sentenced to a term of imprisonment of more than 1 year;
I am sure some operators were fighting this part tooth and nail. No wonder congress and the lobby groups are at loggerheads.
@veedster
Thank you. I agree. It will kick out some guys.
Now lets enjoy the tracker:
https://www.congress.gov/bill/117th-congress/house-bill/2901/text
After all we have learned that the public communication about EB5 is controlled and paid. Its also a nice move to provide an email to keep any conversation out of the web (above video). Who is willing to answer for free questions 😉
After reading this from top to bottom, to my layman’s eye, I do not see anything bad in it at all.
By enforcing accountability,t puts more and more burden of transparency, scrutiny , proof, and audit on operators, which in my view is a good thing for investors .
Why would they NOT agree to this? What do they want to hide?
I have an idea.
We ALL should send the HR2901 (04/28/2021) to our RC operators (every one of them) and ask them, which part of this Bill, that they do not agree with and why?
@veedster
Great idea. Lets start with Jeff Campion 🤫
TEA qualification and lower investment amounts are all they care about, so they can attract new fools to the program. Net, it is all about money!
Blinded by greed, and believing in Congress’ inertia in bringing integrity changes to the program, they clearly miscalculated this time.
They missed countless opportunities to work with Congress without the rope around their neck, and today without negotiating power and credibility with Congress, they are waiting for a miracle. The truth is that the regional centers have always benefited from this loose scenario that allowed them to make rules more flexible at their convenience or to act freely in the vacuum of the law. It is worth remembering that the inefficiency of the USCIS serves as their ally for the current state of affairs. An explosive combination impacting the lives of thousands of families.
The EB-5 indirect program should not be reauthorized in the absence of integrity measures for both the regional centers and the USCIS.
I have just read this statement from IIUSA :
https://iiusa.org/blog/advance-information-about-the-upcoming-december-visa-bulletin-and-the-latest-data-on-eb-5-waitlist-at-the-national-visa-center/
Could it mean that approved petitions for Regional centers applicants will finally be processed at NVC ?
Otherwise, this good news would only be interesting for chinese direct applicants, and there are probably not much of them
Any insider idea ??
I think the interesting news will be that all direct EB-5 applicants (including Chinese origin) will become current. This will be awesome news for Chinese origin applicants. Anyways, we’ll find out on Monday when the news gets published…
USCIS will continue to be the bottleneck if it doesn’t create a streamlined review process to address the application backlog, Net, if they remain unable to speed up processing, these additional EB-5 visas will just become lost as well.
Hey I guess I predicted right about all direct applications becoming current including!! But I guess it was quite obvious 😏
alas you werre right. and alas this is bad news for RC investors…
What does this mean for Regional centre investors?
For RC investors, it’s bad news because it means that the department of State does not ancitipate that the program be reauthorized soon. Read the previous (excellent) post from Suzanne about that (part 3)
I have to correct my previous comment. Reading the previous great post from Suzanne just gives the information that if all the direct EB5 applications become “current”, it will allow about 4000 more chinese to get the visa. So it’s not a small number at all.
But it is also said that making such a move in the visa bulletin would mean that it “would implicitly give up on regional center authorization happening any time soon”.
So if it would be a great news for chinese direct investors, it would also probably be VERY bad news for regional center applicants.
In both case, it means that what we will see next monday in the visa bulletin could be very significant.
Any other possibility ??
The good news can only be for direct eb5, as the regional centre doesn’t existed now. So if Charlie is saying there is good news for certain eb5 he can only have good news for something that exist, eb 5 direct. So where does it leave the regional centre investors? Still In limbo till next year? Any other views? I can’t see this any other way
Hello everyone,
I’m one of the direct investor country of birth bangladesh and I submit I-526 on October 4th 2019. Still I didn’t receive any approval or RFE. So there is no good news for direct investor either. I think USCIS doesn’t caring about investor program.
China EB5 direct investment is current now, so that’s gonna be good news for at least 4k people.
Senator Leahy is retiring. I wonder if this is a positive or a negative for RC re-authorization.
https://thehill.com/homenews/campaign/581625-leahy-retirement-shakes-up-vermont-politics
I believe his term ends Jan 2023. By then EB5 RC will either be reauthorized or dead. So his retirement should not affect.
I do not understand how he went for cheerful and enthusiastic about the program to hater and horrid blocker. There is something that does not make sense. Only because one developer cheated does not mean we are bad people. I hope he seems the humanity within the Problem I hope we give him courage to try to pass this legislation. I also do not understand how “the Industry” did not agree with it passing, or mas it Senator for Arizona?
Senator Leahy has not blocked EB-5 legislation; he has tried to get it passed repeatedly since 2015, and repeatedly been blocked by other senators at the behest of the EB-5 industry, most recently this year. Meanwhile, the very regional center that he celebrated and supported for years as a good example of what EB-5 can do turned out to be involved in a complicated and devastating fraud that’s been huge news in Vermont for the past several years. You can go to Senator Leahy’s website and read through the history of EB-5-tagged posts, if you want to know more. This background explains why Senator Leahy has become specifically a champion for reform.
Sen Leahy and Schumer need to understand that while they speak of “maintaining integrity of EB5 program”, allowing thousands of existing investors lose their money and immigration benefits is probably the biggest EB5 fraud in itself. They should have taken care of existing investors when they de coupled the EB5 rule from budget bill.
Merci. J’aime vos mots et votre façon d’aborder la question.
Merci beaucoup à votre information