EB-5 Integrity Fund FAQ, with notes on regional center status and investment period

Today, USCIS sent out an email alert with the title USCIS to Start Collecting Fee for EB-5 Integrity Fund, published a new EB-5 Integrity Fund page on the USCIS website, posted a Federal Register notice with information about the Integrity Fund, and created a new page for EB5 – Annual Fee for Regional Center at Pay.gov.  

We’ve known that annual regional center fees were coming, since Section 103(b)(J) of the EB-5 Reform and Integrity Act (RIA) created this new requirement. But we’ve been waiting for USCIS to clarify questions around the fee, including how and when to pay it, who qualifies as the “each regional center designated under subparagraph (E)” who needs to pay the fee, and who counts as “investors in the preceding fiscal year in its new commercial enterprises” for the purposes of calculating how much to pay.

Here are answers gathered from the documents published today by USCIS.

Who needs to pay the new EB-5 Integrity Fund fee, and when?

USCIS interprets RIA to mean that every regional center, regardless of when designated and regardless of when or if it sponsored investors, needs to make its annual Integrity Fund payment of $10,000 or $20,000 to USCIS between tomorrow and March 31, 2023. The fee due this month will apply to FY2023. (The next annual fee, for FY2024, will then come due in October 2023.) The Federal Register notice indicates that USCIS expects that all 630 previously designated regional centers will pay the fee, including those with no investors at all. The announcements give no indication that USCIS considered exceptions for regional centers that were not designated under the new law and do not have investors under the new law.  

What does the USCIS fee policy imply about USCIS treatment of previously-approved regional centers?

The fee policy apparently takes for granted that when RIA created a fee requirement applicable to “each regional center designated under subparagraph (E),” RIA did not actually specifically mean RIA subparagraph (E), but also the 1993 law Section 610.  

USCIS has yet to designate any regional centers under subparagraph (E) by approving I-956 applications. An unknown number of previously-approved regional centers have filed I-956 and chosen to solicit investors under RIA. This creates a grey area for the many regional centers that were only approved and only raised investment under the old law.  USCIS admitted as recently as October 2022, in meeting with the litigation plaintiffs, that “USCIS has not determined what will happen to regional centers that choose not to file Form I-956” and “whether any of the RIA requirements apply to them.”

But whoever drafted today’s USCIS fee policy did not recognize a grey area. The policy simply assumes, without argument or explanation, that new requirements applicable to regional centers designated under RIA also apply to regional centers previously designated under Section 610 of the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 1993. The drafters of the fee policy apparently did not consider the arguments in my Comment on the RIA impact on pre-RIA Regional Centers and investors.

What will happen to any regional center that does not pay the EB-5 Integrity Fund fee by March 31, 2023?

On May 31, 2023, USCIS will start to send out Notices of Intent to Terminate to every regional center whose fee was not received on-time. (For some RCs, the NOIT may be the first they hear about the fee requirement. USCIS explained that today’s publications will be the only notice, and that USCIS will not individually notify or send invoices to regional centers.) A regional center’s designation will be terminated following the NOIT, unless the regional center can document that it did indeed submit the full required fee amount by the deadline of March 31, 2023.

The termination threat is a concern primarily because the new law defines devastating investor consequences from regional center sponsor termination (as further discussed in my previous post). INA 203(b)(5)(M) stipulates that I-526 petitions will be denied and even conditional permanent residence status terminated upon regional center termination. And the escape route offered in (M) is only theoretical, since USCIS permission is no guarantee that a good faith investor or NCE can – in fact – have a viable option to associate with another regional center. The termination consequence places great weight on today’s fee announcement.

What is the required amount of the EB-5 Integrity fee? What does the fee policy imply about who’s an investor, and what’s the investment period?

RIA states that the required fee for a regional center depends on the regional center’s number of investors in the previous year  – with the $20,000 annual fee reduced to $10K for “each such regional center with 20 or fewer total investors in the preceding fiscal year in its new commercial enterprises.”

But who counts as “investors in the preceding fiscal year” for the purpose of fee calculation? The statutory language could justify a reading as limited as “people who invested and filed I-526/I-526E in the previous fiscal year under RC sponsorship” to as broad as “people at any immigration stage whose investment was still in some sense under RC custody in the previous fiscal year.” The USCIS fee policy published today in the Federal Register presents this reasoning:

  • A possible interpretation of “investor” is “someone still in the investment period”
  • “Investment period” means the period from I-526 filing through the point of I-829 filing, on the authority of a 2021 blog post by Canadian financial professional Rupy Cheema of EB5 Diligence. (I don’t know whether to laugh or cry at this evidence that the USCIS Office of Policy and Strategy was apparently not sweating over statute, regulations, or precedent decisions or its own Policy Manual but just casting about the Internet to find a policy for the EB-5 investment period, but props to EB5 Diligence for catching OPS’s eye and earning the footnote citation in the Federal Register notice!)
  • Since Rupy said in 2021 that the investment period goes approximately from I-526 filing to I-829 filing, and since USCIS has ready data for number of I-526 and I-829 filings while other calculations would be hard, therefore USCIS intends to estimate “total investors in the preceding fiscal year in its new commercial enterprises” as equal to the total number of pending and approved I-526 at year-end less the total number of I-829 filed at any time by principals. With the qualification that “USCIS adjudicators retain discretion to evaluate the Integrity Fund fee due and the number of investors on a case-by-case basis, accounting for any other facts or evidence in the record in the totality of the circumstances, including any evidence provided by a regional center that believes it has greater or fewer total investors.”

This is a sober recital of the content of the Federal Register notice.  What can we expect next from the Office of Policy and Strategy?

Everyone involved in the huge fight over defining the “investment period” (on the regional center side and investor side) will be interested in this paragraph from the Federal Register analysis:

“USCIS considered generally counting only the Forms I-526 that were filed within two years of the applicable period used for determining the EB-5 Integrity Fund fee given the expected two-year minimum timeframe for the investment, or sustainment period, under the 2022 Act. INA section 203(b)(5)(A)(i); 8 U.S.C. 1153(b)(5)(A)(i). However, that would likely be underinclusive given that many investors are actively in the process of investing (i.e. not yet fully invested) when they file their Form I-526 petition as permitted under applicable requirements and, additionally, would not align with the sustainment period for those who filed prior to the 2022 Act, which runs approximately to the point of the Form I-829 filing, regardless of when they filed their Form I-526 or made their investment.”

Do we have a chance to provide feedback on the fee policy?

The Federal Register notice states that “USCIS is imposing this fee without soliciting public comment prior because this is a general statement of policy and an interpretive rule exempt from notice and comment procedures.” The notice claims that “The statutory provision that requires the $20,000 and $10,000 fees contains little ambiguity for USCIS to resolve or explain.” (And this, after the notice grappled with ambiguities around the investor count and overlooked the major ambiguity of regional center applicability.)  I will update this post if I learn of a chance to respond with questions and concerns.

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.

7 Responses to EB-5 Integrity Fund FAQ, with notes on regional center status and investment period

  1. Fcl says:

    We were not expecting anything better from USCIS
    Funny to hear the big stances of the democratic administration about immigration and be at the the same time in this mess
    That just keep fighting against any honest and legal investor by all means they have

  2. Saurabh khanna says:

    Hey Sue
    I always appreciate your blog, with your blog, I always get some insight about my scenerio. I filled my I 526 on June 29, 2021 for me and my family. I am from India and living in buffalo, ny on my e2 visa. I applied with rc and rc guy told me that I am in 10 % high employment cetogary. I am little confuse when you said that it may take 4-5 years just for the conditional. Would they consider my case under 10% or unreserved.. I would appreciate your feedback.
    Thank you
    Saurabh

    • As a high-unemployment investor before the EB-5 Reform and Integrity Act was enacted, you qualified for “T5” or “R5” code visa at the time of filing. Since RIA passed, abolished the old TEA and regional center reserve visa allocations, and created new set-asides, T5 and R5 have now been made a subset of the new “unreserved” category (as you can see in the 2022 Annual Report of the Visa Office and any Visa Bulletin). Department of State does not plan to give pre-RIA investors in high-unemployment TEAs the option to qualify for new high unemployment reserve visas, as you can see from the Q&A at page 5 of this link: https://travel.state.gov/content/travel/en/News/visas-news/department-of-state-aila-liaison-committee-meeting-06-09-2022.html. This is non-intuitive, unjust, and unfortunate in my opinion, but the fact.

      • saurabh khanna says:

        Oh wow … that’s the surprise … thank you for answering…

        • Also note that it wouldn’t necessarily help you to qualify for one of the 10% visas reserved for high unemployment, because if you qualified, so could many of the 6,000+ Indians who applied before you and still waiting (the majority of pre-RIA investors being in high-unemployment projects). In fact, your situation could be worse if instead of qualifying for 7% of 68% of EB-5 visas, you and the rest of the crowd were made to exclusively qualify for 7% of 10% of EB-5 visas. Even among post-RIA applicants, the people with an assured good situation for high-unemployment reserves are people from countries that have never exceeded 70 visas annually, people from higher-volume countries who were among the first 35 of their countrymen to file I-526 after March 2022, and people who will reach the visa stage among the first 1,000 applicants (i.e. 500+ investors). (And my understanding is that new applicants are indeed limited to a visa in the category in which they apply; new applicants can’t share the unreserved pool with you unless they invest outside a TEA.) Everyone is facing limits.

          • saurabh khanna says:

            Ok.. so I guess I should be happy that I am not in 10% .. its just frustrating .. I am not wealthy and I had put my hard earned money in to a third person hands for who knows
            and how many years.. I just hope this gets better because I remember, I was told that it does not take more then 2 years for conditional and with this scenarios, I think it will be well over 4- 5 years .. I am glad there are people like for some transperacy.. thank you

          • Bhaskar says:

            These numbers are per year, correct? So people who apply after those numbers you mentioned will be next in the line for the following year?
            And the rural category will have double of these numbers?

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