FY2019 Q3 EB-5 Forms Processing Data

In her talking points for the EB-5 Modernization Stakeholder Call (September 9, 2019), Investor Program Office Chief Sarah Kendall made the following statement regarding processing times.

3. IPO UPDATES AND PROCESSING TIMES

USCIS continues to process applications from regional centers and petitions from immigrant investors in a manner that strives to ensure timely adjudication while maintaining program integrity.

Over the past few years, IPO has been working diligently to reduce processing times by onboarding additional personnel, resulting in adjudicating more than 14,900 Immigrant Petitions by Alien Entrepreneur (Form I-526) in fiscal year 2018, which was an approximate 69% increase over the average completions for the previous five fiscal years.

During fiscal year 2019, the sunset of the Regional Center program during the last part of December and through most of January, cost IPO adjudicative time even after the program was reauthorized. IPO was forced to pivot to stand alone petitions and I-829 work and halted production on I-924s and I-526s associated with a Regional Center.

Additionally, IPO has taken significant steps in building more robust quality assurance and control programs to better ensure consistent adjudication practices, including conducting an extensive training session for all I-526 adjudicators and economists.

These reasons, along with temporary assignment of some staff to other agency priorities, have resulted in longer processing times, which you may have noticed with the May update to our online processing times.

These talking points do not suggest a crisis. The statement leads by emphasizing strong performance in 2018, and attributes the “longer processing times” that we “may have noticed” in 2019 to temporary factors: the few-week lapse in regional center authorization in December/January, a training session, and temporary reassignment of staff. There’s no suggestion of a major and persistent problem.

USCIS has now published FY2019 Q3 processing data for EB-5 forms on the Immigration and Citizenship Data page, and the numbers are concerning.

• IPO is approving dramatically fewer I-526 than ever before:
  • Completion rates for I-526 have fallen 63%, comparing FY2019 with FY2018 year-to-date.
  • In FY2019 Q3, IPO processed fewer I-526 than ever before in its history – only 579 completions for the whole quarter, as compared with 3,000-4,400 completions per quarter last year.
  • In FY2019 Q3, a record number of I-526 decisions were denials — 42%. The average I-526 denial rate is 20% in FY2019 YTD, as compared with 9% in FY2018 YTD.
• IPO is processing dramatically fewer forms in total than ever before:
  • Completion rates across EB-5 forms (I-526, I-829, I-924) have collectively fallen 59%, comparing FY2019 with FY2018 year-to-date. This demonstrates that IPO is not merely reallocating resources internally, but has become less productive across the board.
  • In FY2019 Q3, IPO processed more I-829 than in the previous quarter, but still a low volume – lower than average 2017/2018 performance for I-829.
  • Both IPO and the industry seem to have given up on I-924, with just a few handfuls of I-924 receipts and completions in the last two quarters. (And no wonder, when the current Processing Times report indicates that an I-924 is only considered “outside normal” processing after 90 months.)
• Reduced performance combined with backlogs threaten long processing times.
  • FY2019 Q3 processed 579 Form I-526, and ended the quarter with 13,070 pending I-526. If IPO were to continue at the same processing volume, then the pending I-526 would take 13,070/579=23 quarters=5.6 years to process. If IPO had kept up (or can soon return to) last year’s volume of 3,000+ completions per quarter, then the same backlog would take just one year to process.
  • FY2019 Q3 processed 613 Form I-829, and ended the quarter with 9,295 pending I-829. If IPO were to continue at the same processing volume, then the pending I-829 would take 9,295/613=15 quarters=4.8 years to process.
• The processing crisis at IPO is reflected in every quarter so far of FY2019, with each quarter worse than the last, and all together much worse than IPO’s performance from 2015 through 2018. I very much hope that the contributing factors are temporary, as Sarah Kendall suggested. I wish that she’d mentioned any expectation or intent to improve any time soon — at least to previous performance levels. Otherwise, one’s left to suspect an unspoken reason: that IPO has a new policy to maximize time spent per petition. But that would be a terrible move for program integrity. Long processing times benefit fraudsters, who can flourish in the expectation of years before USCIS gets around to reviewing investor petitions and catching the fraud. The worst harm and deterrent from long processing times falls on the best users — projects that genuinely need EB-5 investment and care about their investors. I hope that USCIS recognizes this important integrity issue, and soon improves — at least returning to the performance levels achieved in recent years.
• Meanwhile I-526 receipts remain low, with the pre-regulations surge not in evidence yet as of June 2019.

For links to previous articles on processing data, see my EB-5 Timing Page.

Understanding the Visa Bulletin

The forthcoming Visa Bulletin for July 2019 includes an EB-5 final action data for India for the first time, and no change from June to the EB-5 final action dates for China and Vietnam.

Chart A. Final Action Dates for Employment-Based Preference Cases [excerpt from July 2019 visa bulletin]

Chart B. Dates for Filing of Employment-Based Visa Applications [excerpt from July 2019 visa bulletin]

For people who want to understand these charts, I suggest: ignore us bloggers and read the visa bulletin itself from top to bottom. Department of State takes care to explain clearly what the dates and charts mean, and what to expect going forward. The internet, on the other hand, is currently awash in confusing and faulty information.

So read the bulletin, and try this quiz. Are the following statements true or false?

1. The EB-5 category is current, and expected to remain current, for everyone except applicants born in China, Vietnam, and India. Current means that EB-5 visa numbers can be issued to all applicants as soon as they are qualified, with no wait for visa availability.
2. During July 2019, India-born EB-5 applicants abroad can still continue to submit documents to NVC regardless of priority date, but only those with priority dates before May 1, 2017 can receive visas.
3. During July 2019, I-485 can be neither filed nor approved for India-born EB-5 applicants with priority dates more recent than May 1, 2017.  Those with priority dates before May 1, 2017 are free to file I-485 and may receive visas.
4. In general, I-485 filings must follow the Final Action Dates in Chart A, not the Dates for Filing in Chart B, unless USCIS specifies otherwise on its www.uscis.gov/visabulletininfo page.
5. During August and September 2019, Department of State does not expect to issue any EB-5 visas to India or Vietnam. It expects to use up 2019 visas available to those countries in July. It’s possible that a few more EB-5 visas may be issued to China-born applicants in August and September.
6. A final action date in the July 2019 visa bulletin means that DOS counted up known qualified applicants of June 6, 2019, and determined that qualified applicants exceeded the number of visas available for the year. Known qualified applicants include people documentarily qualified at the National Visa Center and adjustment of status applicants, as reported by consular officers and USCIS.
7. The final action date for India means that May 1, 2017 marks the head of the line of Indian applicants who can’t yet move forward with the visa process. It means that  DOS thinks it has only enough 2019 EB-5 visas left to accommodate currently-qualified Indian applicants with priority dates of April 30, 2017 and earlier.
8. When 2020 visas become available in October 2019, then the final action dates for Vietnam and India will move forward again. In October, Department of State expects to start issuing EB-5 visas to Indians with priority dates in summer or fall 2017, and to Vietnamese with priority dates in fall or early winter 2016.
9. The July 2019 visa bulletin applies to July 2019. While it’s still June, we operate under the June 2019 visa bulletin, which has no final action date for India.

The above statements are all true, according to the visa bulletin.

1. Answered in the Visa Bulletin Chart A (in the Employment Based section) and Section G (near the bottom of the page)
2. Answered in the Visa Bulletin Chart A and B (in the Employment Based section)
3. Answered in the Visa Bulletin Chart A and B (in the Employment Based section)
4. Answered in the Visa Bulletin opening paragraph #2
5. Answered in the Visa Bulletin Section F and G (near the bottom of the page)
6. Answered in the Visa Bulletin opening paragraphs
7. Answered in the Visa Bulletin opening paragraphs
8. Answered in the Visa Bulletin Section F and G (near the bottom of the page)

And to again combat a persistent and pernicious misconception, a reminder: today’s visa bulletin does not provide a visa time estimate for today’s investors.

Here’s a story problem. Let’s say you enter an office and pick a number that determines when you’ll be served. The office had opened at 6 am, and started issuing numbers at that time starting with number 1. The office can serve about 700 people per hour, and has been operating at capacity since 6 am. When you arrive, you get number 5,852.  While you were arriving, the intercom was announcing, “now serving #1,750, Fred Smith.” How do you calculate when you will be served? Which information provided is relevant to solving the problem?

The simplest answer is 5,852/700=8.4.   6 am + 8.4 hours = 2:24 pm for expected service. The intercom announcement when you walked in the door is irrelevant to your time. Fred’s wait time does not bear on your wait time.

A guy at the door may point to the intercom and reassure you “Don’t worry, the wait won’t be long. Listen, Fred Smith is already getting service and it’s only 8:30 am – so the wait must be 2.5 hours at most.” Ignore that guy. Your time of service results from the time it takes to process the 5,851 people who got into the office before you did. Your wait time is unlikely to match the wait of someone with 1,749 people earlier than he was.

Now to align this analogy to EB-5. A couple months ago, Charles Oppenheim estimated that there were 5,851 Indians in line for EB-5 visas as of May 6, 2019, and therefore an India-born investor entering the end of that line on May 6, 2019 would wait 8.4 years for a visa. The wait time for someone with a May 6, 2019 priority date is determined by the time it takes to move the applicants with earlier priority dates through the system at a rate of approximately 700 per year. Today’s visa bulletin announcement is irrelevant to the 2019 investor’s wait time. Someone will say “Don’t worry, the wait won’t be long. Look, the July 2019 Visa Bulletin says the Indian applicant with April 2017 priority date can get a visa in July 2019 – so apparently we’re looking at a modest visa wait of 2.5 years.” Ignore that. The wait time for the person with a 2017 priority date does not translate to someone entering with a 2019 priority date at the end of a larger backlog.

Consider the May 2015 visa bulletin, which gave China its first final action date of May 2013. “Just two years to wait, not bad,” thought some new investors, and the market continued to flourish in ignorance. But Chinese who invested in May 2015 are still not even close to getting a visa now, four years later. The May 2015 visa bulletin gave a wait time for May 2013 petitions, not for May 2015 petitions. China-born investors in May 2015 needed to know, instead, the size of the China backlog in May 2015, and the number of visas available going forward.

Back to India, what can we do with this equation: 5,852/700=8.4

8.4 years is not a good number for marketing to India. Many would say that’s too long to wait for conditional permanent residence, and creates too much risk from material change and redeployment during the wait time. And the time has only been getting longer as more people have invested and added to the backlog.

We need a result less than eight years, which means that the numerator (5,851+applicant backlog) needs to be smaller, or the denominator (about 700 visas per year)  needs to be larger.  Some promoters with knowledge of the market make the numerator smaller by asserting that Department of State/USCIS have unreliable data that overestimated the number of people in the backlog. These promoters estimate that the true backlog is at least 50% smaller, and wait times thus at least 50% shorter, than estimated by Charles Oppenheim. The numerator will become smaller if many past investors give up or lose eligibility over the course of the wait time. Meanwhile, our people in Washington are, we hope, trying their best to make the denominator larger by advocating for more visa numbers. So long as the country wants a lot of investment, it must have enough visas to accommodate that investment. Otherwise, wait times are discouraging for potential investors from China, India, and Vietnam who believe the backlog data and do the math, and tragic for previous investors who were not informed about the backlogs.

Finally, a reprise of my handy image of the EB-5 process. And a few reminders. My data repository is on the EB-5 timing page. I set up an EB-5 Timing Estimate Service for anyone who wants a mathematical time estimate and explanation specific to his or her own priority date, or to the priority dates of their investors. And for those more worried about China than India, IIUSA promises to have a new post up soon that gives further analysis of Oppenheim’s China wait calculation from May 2019.

Forecasting Visa Availability: 5/6 Oppenheim projections and big picture

[Post updated 6/19/2019] Today Charles Oppenheim, Chief of the Visa Controls Office at the U.S Department of State, gamely appeared again at IIUSA’s EB-5 Advocacy Conference to discuss EB-5 visa availability.

So far Twitter just reports a few headlines from his talk. India is expected to reach its limit and get a cut-off date by July 2019, and to start FY2020 with a final action date in Summer or Fall of 2017. Rough estimates for visa wait times for I-526 filed today: 16.5 years for China, 8.4 years for India, 7.6 years for Vietnam, and 2.4 years for South Korea. I trust that IIUSA will again support program integrity by publishing a blog post with the detail and slides from Mr. Oppenheim’s talk. When that happens, I’ll update this post with a link. [UPDATE: Here is IIUSA’s post on the Oppenheim presentation, with a link to his slides.] But for the moment, some background and comments on what the estimates do and do not mean.

Future visa wait times rest on several uncertain variables, and thus impossible to calculate with certainty. Mr. Oppenheim has gotten flack for attempting long-range predictions that aren’t and can’t be perfect. But rough headline-making projections serve a purpose: to highlight the existence of real visa availability issues, even if with a significant margin of error.  Hearing “16.5-year wait” at least alerts EB-5 users to a problem with China visa availability, though an accurate year estimate could be longer or shorter depending on which assumptions one chooses to use for the calculation. [I have a request pending with IIUSA to clarify Oppenheim’s assumptions.]

There are two ways to go wrong in interpreting future EB-5 visa wait time estimates. One is to interpret them as some kind of official guarantee, and blindly follow or furiously attack them as such. The other is to dismiss them as mere hot air, conclude that wait time projections are prohibitively complex, and thus disregard wait time as a factor in EB-5 decision-making. Some past EB-5 investors make the first error. Unscrupulous promoters hope that all prospective EB-5 users will make the second error.

In the past I’ve delved into the detail and complications behind EB-5 visa availability, with my 10-tab spreadsheet of data, log of visa allocation statutes, and scenario analysis. But examining the trees can mean losing sight of the forest. So for this post, I want to focus on the solid big picture behind all our varied and flawed attempts to quantify EB-5 wait times in detail.

First, an image to clarify how the EB-5 queue works. It’s the kind of queue where you enter a waiting room, take a number, and sit down to wait, watching a notice board for your number to be announced to show that your turn has come. Meanwhile, other people are also moving through the process and getting their turns and leaving, while others enter, and the notice board updates regularly.

[Image updated 6/19/2019]
In EB-5, the place-holding number is “priority date” – the date of I-526 filing. The notice board is the monthly Visa Bulletin, which signals which priority dates can get service at any given time.

Figure 1 illustrates the stages in the EB-5 process up to conditional permanent residency.

• Step 1: File I-526. This step initiates the EB-5 process, and assigns a priority date that marks each investor’s place going forward. There is no constraint at this stage; as many people as want to file I-526 can file I-526.
• Step 2: Waiting for I-526 approval. In principle, I-526 adjudication is first-come-first-served without regard to nationality, but it’s not strictly by priority date. In recent years, most people have waited 1-2 years at this stage. This stage is only constrained by USCIS efficiency in processing petitions. The USCIS Processing Times Report gives a rough indicator of progress in I-526 processing. Step 2 must be completed before the investor can apply for a visa. We have data for I-526 receipts, approvals, and pending petitions at various points in time. (Such data only counts number of principal investors, so need to multiply by an estimated number of family members when making total visa demand estimates.)
• Step 3: Wait for a fee bill from the National Visa Center (consular processing), and wait for the visa bulletin to indicate that one is qualified to move forward in the process.
• Step 4 to 5: Investors plus family members can proceed to get green cards through consular processing or I-485 status adjustment once visa numbers are available to them. At this stage, priority date and nationality determine order of service, and the Visa Bulletin announces each month who can proceed. We have data for the number of people waiting at Stage 3-4 from different countries at various points in time. (Such data already counts investors plus spouse and children – don’t multiply by derivatives again or you’ll overcount.)
• Step 5 has the major process constraint – the annual EB-5 visa quota. The annual limit: about 10,000 total EB-5 visas worldwide, of which at most only about 700 can go to each country other than China, and none to China except what’s leftover from the rest of the world (which has been 4,000 – 9,000 visas in recent years). Steps 3-5 can be less than a year wait for applicants born in countries that are “current” in the Visa Bulletin (not at risk of exceeding the 700/year visa limit). Steps 3-5 involves multi-year waits for applicants born in countries that do exceed the annual quota. The more in excess of the quota, the longer the wait.

Some points that I tried to highlight in Figure 1, to combat misconceptions:

• The person just entering at Step 1 can look up at the notice boards and see who’s currently getting service. He can see from the current processing times report that most I-526 from before 2017 have already been processed, and from the current visa bulletin that China-born applicants who filed I-526 in October 2014 are now getting green cards. But that’s just info about the end of other peoples’ process — indicating who’s being served now, and how long they waited. It does not look forward to indicate when May 2019 priority dates will be served, or how long the person at Step 1 will wait.  To forecast into the future, and guess about future notice dates, the person in Step 1 needs to look around and forward — at how many other people are entering Step 1 and waiting in Step 2 to Step 4 in front of him. Charles Oppenheim attempts to help with such guesses.
• Wait times result from backlogs building up against the major constraint in the EB-5 process – the annual visa quota. Unfortunately for efficiency, this constraint is in the last step. To estimate his personal wait time, the person in Step 1 needs to estimate how big the backlog will be once he gets to Step 3. Again, this requires looking around and forward — at how many other people are entering Step 1 and waiting in Step 2 to Step 4 in front of him. The variables are clouded by spotty information and judgment calls, but the equations themselves are simple. If I’m an India-born person in Step 1, then my visa wait = (A) qualified India-born visa applicants with priority dates earlier than mine divided by (B) about 700 visas per year limit. Variable (A) is equal to India-born investors waiting in Step 2 in front of me, minus attrition from I-526 denials and withdrawals, plus family members who will join the approved India-born I-526 in Step 3-4, plus India-born applicants already waiting in Step 3 and 4, minus India-born applicants who will drop out or receive visas during my time in Step 2-4.
• It’s good to step back sometimes from the confusing variables to the simple equations, as a reminder of the big picture and basic logic of wait times. The basic logic is that visa waits are mainly a function of I-526 volume. Unknowns about future denials and withdrawals and family size and processing times will vary forecast calculations this way and that, but this is sure: a lot of I-526 filings will result in a lot of people eventually ready for a visa. A lot of visa applicants will mean long backlogs and wait times in front of the visa quota constraint. People at the beginning of a surge in I-526 filings will wait less time for a visa than people after a surge.
• With that in mind, one last figure, the most telling of the numbers in my backlog calculation file. If I were a lawyer counseling EB-5 users about big picture timing issues, I would have them consider the numbers in Table 1. How many investors plus family are likely to end up at Step 5, and when, considering how many investors have started at Step 1? What future wait times are implied in that past demand, considering visa number limits? It’s impossible to look at I-526 numbers and predict exact backlogs and wait times, considering all future variables, but it’s easy to see the general issue. For example, over 700 Vietnamese investors filed I-526 in 2018, and only 700 Vietnamese investors plus their spouses and children can get visas in a year, so Vietnam is clearly looking at a backlog and wait time situation at the visa stage — a situation exacerbated by excess demand in 2016 and 2017 as well. A Vietnamese investor had better not rely too heavily on specific future estimates from Charlie Oppenheim or anyone else, but she can and should have a chance to see the fact and consider the consequences of excess demand.
  

NOTE: I’ve added a EB-5 Timing page to collect links to data and posts related to EB-5 visa availability, visa allocation, and wait times. If you would like to order a personalized timing estimate, see the EB-5 Timing Estimates Page.

FY2018 Q4 Petition Processing Data

USCIS is finally starting to update its Immigration & Citizenship Data page with data for petitions processed in FY2018 Q4 (July to September 2018). As usual, I’ve made charts to highlight salient features.

I like to look at annual trends in receipts and adjudications, because this reflects demand and allows understanding and predicting processing times at the Investor Program Office.

The backlog of pending petitions grows and processing times increase when IPO receives more petitions in a year than it can process in a year. That happened for I-526 from 2010 to 2017, when IPO finally started to catch up. In 2018, IPO surged ahead, processing more than twice the number of I-526 received. At this rate, the entire backlog of I-526 pending as of year-end 2018 will be adjudicated in 2019, and new I-526 can expect processing times of less than one year. I-526 processing times were a major factor for people who filed during peak demand in 2015 and 2016, and thus faced years-long processing on average. I-526 processing times will fade as a consideration, as new petitioners can expect months-long waits on average. (My I-526 prediction spreadsheet forecasts future processing times from petition volume.) Meanwhile, I-829 faces continued long processing times because adjudication volume is so small compared to the backlog. So long as IPO can only process less than 3,000 I-829 in one year, it will take 2-3 years just to get through the backlog of 7,660 I-829 pending as of October 2018. But we hope to see I-829 volumes improve considerably in 2019.

IPO’s total output was about the same in FY2018 Q4 as in Q3, just with a few more I-829 processed at the expense of a few fewer I-526. Meanwhile, the number of forms received by IPO remained relatively low in Q4. There was a small I-526 surge in advance of the September 30, 2018 regional center program sunset date, but nothing like in previous years. There continue to be very few new regional center applications and amendments, and high denial rates for previously-filed I-924.

I’m putting out my PayPal link again, particularly as an appeal to industry colleagues who depend on me to research and report news. How much more work would you have to do, if blog.lucidtext.com weren’t here to watch for and process EB-5 updates? If this blog saves you considerable time and effort, consider helping to make it worthwhile for me. (I am also contemplating advertising options, but have not settled on a strategy for appropriate and effective presentation within the constraints of the blog format.)

FY2018 EB-5 Visas by Country

The US Department of State has published Report of the Visa Office 2018 Table V Part 3, which gives a tally of visas (conditional green cards) issued by country for the Employment Fifth preference (EB-5) in FY2018. The major story in the FY2018 report is the increase in EB-5 visas issued to applicants born outside of mainland China.

EB-5 in the early 2000s used relatively few visa numbers overall, and only really took off with the increase of EB-5 interest from/in China after 2008. Then China-born investors drove growth and claimed a majority of visas until the total number of EB-5 visas possible to issue hit its ceiling: the annual quota of about 10,000 visas. Since that ceiling was reached in FY2014, there’s been no room for EB-5 to grow — China and the rest of the world just have to jockey each other for the available annual visas. The decreasing number of EB-5 visas issued to China-born applicants since 2014 does not primarily reflect decreasing demand from China (China still dominates the backlog), but increasing demand from other countries that decrease the number of visas available to China.

FY2018 data shows a marked increase not only in total number of applicants from outside China, but also in the number of countries supplying those applicants, and in the number of countries with a relatively large number of applicants each. EB-5 marketers care about this, because it helps identify the range and depth of market potential outside of China. Past China-born investors care about this, because their future wait times depend on the nature of incoming non-China demand (with best case scenario being demand concentrated in a few countries that will become blocked by the per-country cap, and worst case being large total demand spread out over many countries).

We want to read EB-5 visa reports and draw conclusions about demand for EB-5 investment opportunities. So a few reminders to qualify such conclusions:

• The Visa Office report indicates the number of green cards issued for conditional permanent residence. To track visa numbers back to investor detail, it’s necessary to factor in the time between investment and visa issuance (about 1 to 5 years in 2018 depending on investor origin and I-526 processing time), and the number of visas per investor (about 3 on average).
• The Visa Office report only directly reflects demand for countries that take significantly less than 700 visas (ie less than the 7% per-country cap). For countries that exceed the cap, the number of visas issued is not the number they demanded, but the number they could get. In FY2018, Vietnam got 7% of total EB-5 visas pursuant to the per-country cap, regardless of how many Vietnamese were ready to apply, and China got 48% of visas because that’s what was left for the oldest applications after demand from undersubscribed countries was satisfied. On the other hand, India remained under the per-country cap in FY18, so its 585 visas directly reflect the number of FY18 applicants (more than threefold increase from the previous year). But keep in mind, lengthy I-526 processing times mean that the FY18 surge in India visa applications reflects a surge in investments from India that happened 1-2 years ago. For a better sense of recent demand trends, see the log of pending I-526 by country and priority date that USCIS published in October 2018.

I’ve expected to see an increasing number of visas associated with direct EB-5 investments, but that hasn’t been true so far. Regional center investments accounted for 94% of EB-5 visas issued in FY2018, as compared with 93% in FY2017 and 91% in FY2016. For reference, here is my post on FY2017 EB-5 Visas by Country

I haven’t had time yet to update and recalculate my backlog calculation spreadsheet. But I will add one table here as follow-up to ILW’s article EB-5 Industry Misunderstands Retrogression (12/31/2018). The article estimates that “India generated close to $500 million in EB5 investments in 2018, and it is on track to generate $1 Billion in 2019 and $2 Billion in 2020. Indian EB-5 is a $3 Billion opportunity in the coming two years.” The article goes on to rightly correct misconceptions about how EB-5 visa allocation works, but omits one important calculation: what happens if one puts $3 billion dollars (12,000+ visa applicants) from one country in line to a gate that can only issue about 700 visas annually.

If we want to make Row A in that table a reality, and how wonderful that would be, then we have to deal with the constraints that turn successful markets into backlog tragedies. Let’s put the pressure on Congress for visa relief. Otherwise, ethical promoters will have no option but to reduce the amount of investment they try to raise, or to support proposals dramatically increasing the minimum investment per investor.

UPDATE: I’ve added a EB-5 Timing page to collect links to data and posts related to EB-5 visa availability, visa allocation, and wait times. If you would like to order a personalized timing estimate, see the EB-5 Timing Estimates Page.

Applying data to questions (I-526 timing, visa timing)

This post applies data that’s recently become available to practical questions that EB-5 issuers and past/potential investors keep asking. [FYI: many edits made since first posting.]

Question 1: How long does I-526 take?

This question has a nice answer for new petitioners: much less time than before.

As inventory falls and flow rate increases, processing times fall. People who filed I-526 in 2016/2017 entered at the top of a mountain of pending petitions (as illustrated in Figure 1), and have suffered long processing times as a result. But people who file I-526 now in November 2018 are just standing on a molehill by comparison, plus benefiting from improved completion rates. They can expect their petitions to be processed in less than a year, I estimate. (I estimate processing times based on USCIS data for pending and processed petitions. See my I-526 time spreadsheet.)

As I-526 times improve, the many countries in the world with no visa wait (all but China, Vietnam, and (soon) India) will be able to enjoy EB-5 as a fast track once again. And project companies, investors, and program integrity all benefit from prompt attention by USCIS to investor petitions.

Question 2: If I’m a Vietnam-born person with pending I-526 or pending visa application, how long can I expect to wait for EB-5 visa availability?

This question has a better answer than many people fear. Last month when Charles Oppenheim of Department of State predicted a 7.2-year wait for Vietnam-born, he was giving a prediction for one point: people filing I-526 on October 30, 2018. If that point-in-time prediction is correct, then the wait time will be less than that for everyone who filed I-526 before October 30, 2018. The blue columns in Figure 3 mark the data points we have: actual wait times for past applicants (calculated by subtracting Final Action Date from Visa Bulletin Date in past Visa Bulletins), and Oppenheim’s future predictions. Fit a trend line through those points, and you can estimate wait times for other priority dates, between the past actual and future predictions. (The trend won’t turn out neatly linear in real life, but I think this is good for a rough estimate. If you want a better trend line, you can factor in quarterly fluctuations in I-526 filing and approvals, and guidelines for allocating visas by quarter. Or you could push for legislative/administrative fixes that would change the picture entirely.) These charts and source data are in the “Vietnam Calc” tab of my Backlog calculation spreadsheet.

[NOTE: When I first put up this post, I included a Figure 2 for China with linear trend through past visa bulletin waits for 2014 priority dates up through Oppenheim’s 14-year prediction for Chinese filing in October 2018. But the more I thought about it, the more I disliked the China chart — because that 14-year estimate for 10/2018 is questionable, and because complicating factors will likely make the China trend look more like the craggy mountain in Figure 1 than a slope. So I edited out Figure 2.]

Question 3: If I’m an India-born person with pending I-526 or pending visa application, can I expect to get a visa number in FY2019, before visas for India get used up for the year (i.e. before Department of State sets a Final Action Date for India)?

This question is tough, because the answer depends on predicting which petitions get adjudicated in the next few months, and how many. Table 1 and Table 2 below highlight the data points (from among those provided in the 10/30/2018 presentation by Charles Oppenheim) that I consider particularly relevant to the question. (These tables are also in the “India Calc” tab of my Backlog calculation spreadsheet.)

The worst case scenario is that in the next couple quarters, USCIS approves a lot of the I-526 pending for India-born people who filed I-526 in 2013-2017. If that happens (and the newly-approved petitioners quickly become documentarily qualified for a visa), the result could be that no one born in India who filed I-526 more recently will get a visa number in FY2019, no matter how quickly their I-526 was/will be processed or when they filed I-485 or the visa application. This risk exists because visa numbers get issued to qualified applicants in order by priority date, not based on when they filed their visa applications. The risk is accentuated by the fact that Charles Oppenheim at DOS is required by statute to dole out available visas gradually over the course of the fiscal year (no more than about 27% each quarter in the first three quarters), not all at once to as many people as qualify for them. That delay gives time for the pool of documentarily qualified applicants to grow, as USCIS approves more petitions.

The best case scenario is that in the next couple quarters, the pool of India-born people qualified for a visa doesn’t grow much, and additions to the pool mainly consist of people who filed I-526 recently. In that case, everyone already qualified for a visa as of Q1 FY2019 (500+ people) could actually get a visa in FY2019. Plus a few more people (about 60 investors with their families) who will get I-526 approval and become documentarily qualified in FY2019 may also get allocated visas before the approx 700 visas available for FY2019 run out. The best case scenario is possible because expedited projects have been popular with Indians, USCIS can be slow to process older I-526 (and has a lot of older petitions in the backlog from countries besides India), and the process between I-526 approval and becoming documentarily qualified can also be very slow.

The facts in Table 1 and Table 2 suggest to me that an India-born person filing I-526 today is unlikely to get a visa number in FY2019, regardless of how quickly they can get I-526 approval and qualified for a visa. There are just so many older petitions and applications already in the system. I don’t have my life savings and family on the line, however.  If you do have a major life decision depending on EB-5 timing, you should spend more time with the reports and spreadsheets to make your own estimate between the best and worst case possibilities. And talk with the immigration lawyer about limitations and benefits of being at various points in the process (I-526 pending, I-526 approved but not yet documentarily qualified, I-485 pending, documentarily qualified at NVC…) at the time when DOS publishes a Final Action Date for India.

For anyone who doesn’t manage to get a visa number in FY2019, don’t be too discouraged. India will have a trend line, like Vietnam as discussed above. You don’t automatically wait 5.7 years for a visa by virtue of having been born in India. Your wait time will depend on your priority date, with dates before October 2018 promising shorter wait time.

My post EB-5 Visa Waiting Line and Visa Allocation explains in more detail how visa allocation works. FYI, the Telegram group https://t.me/EB5VisaGroup notified me that they assembled their own India prediction spreadsheet. I’m not posting it here because I don’t know how to explain all their calculations and sources, but you can reach out to the group to request their additional analysis.

To the extent that my analysis and reporting benefits your decision-making, please consider my PayPal contribution option (corrected link). My spreadsheets and posts take a lot of time and thought that can only be rewarded if others share their benefit. I hope the work helps my clients who need information, and an industry that needs transparency, but it’s a sacrifice for me personally as a service provider dependent on new EB-5 business.

AILA/IIUSA Forum Updates (Kendall, Oppenheim, visa availability)

Last week I attended the 2018 AILA & IIUSA EB-5 Industry Forum, which featured appearances by new IPO Chief Sarah Kendall and Department of State Visa Control Office Chief Charles Oppenheim.

Ms. Kendall is a career civil servant and spoke accordingly. She gave the impression of being competent, in control, and unlikely to say anything unexpected. I didn’t note anything major in her speech that I hadn’t already heard from the USCIS Policy Manual, OMB Unified Agenda, or previous stakeholder meetings. (UPDATE: Here is a copy of Ms. Kendall’s prepared remarks.) The headlines: no update on regulations beyond what OMB said, and no significant new input on the hot issues of redeployment, bridge financing, material change, or minors as investors. Stakeholder meetings are not the proper venue for policy announcements, so I suppose there’s really not much to do but repeat existing guidance and say “thank you, we’ll consider it,” for everything else. One would expect Ms. Kendall to have a law enforcement orientation, considering her background. And indeed she stated that “focus must be on program integrity,” and listed these objectives for IPO: improve transparency, protect national security, lawful administration of our nation’s laws.  I appreciate that she started with transparency, which is foundational to the other two objectives. And it was gracious of Ms. Kendall (and former Interim Chief Julia Harrison) to attend the AILA/IIUSA event and take time to chat with attendees.

In the past I’ve sometimes felt like a lone crusader with my spreadsheets and numbers reports. I attended the AILA/IIUSA forum in person partly because I suspected that Charles Oppenheim would give information about visa numbers and wait times that my clients need to know, and no one else would process it or publicly report on it. But I was wrong. A wonderful panel on visa numbers not only provided a very extensive data set but analyzed and drew actionable conclusions from it, and then IIUSA made the right choice to promptly publish the full presentation where anyone can access it. And now other people are already reporting on it, without pausing to worry about messaging. Integrity depends on transparency – an important lesson for everyone.

Here is the gold mine: Presentation Materials from Department of State Visa Control Office Chief Charles Oppenheim (UPDTATE: IIUSA has also published commentary on the presentation.)

The slides provide the most comprehensive and current set of visa-availability-related data yet, with helpful interpretation and conclusions. Bottom line: how long should an investor filing I-526 on October 30, 2018 expect to wait for an EB-5 visa number?  Mr. Oppenheim made the following prediction: China, 14 years; Vietnam, 7.2 years; India, 5.7 years; South Korea, 2.2 years; China-Taiwan, 1.7 years; Brazil, 1.5 years. Here’s the famous slide:

These time predictions refer to the time between I-526 filing and visa availability for people filing I-526 on October 30, 2018. People who filed I-526 before October 30, 2018 have fewer people ahead of them in line, and thus can expect correspondingly shorter wait times. People who file later can probably expect longer waits (unless trends or rules change, as they could). The predicted visa wait times for South Korea, Taiwan, and Brazil are now short enough as to be likely imperceptible (i.e. even shorter than I-526 processing time). Mr. Oppenheim foresees that South Korea, Taiwan, and Brazil will remain current (no cut-off date) through 2019 and probably 2020. The predicted wait time for an India-born investor filing today has lengthened since the last prediction from April, but not as much as I’d feared. Mr. Oppenheim now predicts that the Visa Bulletin will have a Final Action Date for India “no later than July 2019.” In other words, the annual EB-5 visa allocation available to India in FY2019 is expected to run out in July. In October 2019, when new FY2020 visas become available, India will have a Final Action Date in 2017, meaning that India-born applicants with priority dates before the 2017 Final Action Date will then be able to apply for visas.  As for China, Mr. Oppenheim predicts that by October 2018, the Final Action Data for China-born applicants will progress to 10/22/2014 (best case) or 10/8/2014 (worst case), and that China will advance (at best) two months in 2019. Mr. Oppenheim expects to be able to move Vietnam’s Final Action Date as far as September 2016 this year, before the FY2019 visas available to Vietnam run out.

For the full background to these predictions, and very helpful commentary on how the visa process and allocation work, potential variability, and what we do and do not know, see the full slide presentation and my voice recording of the panel. (And if you want all the backlog-related data I know, though all you really need is Charlie’s predictions, see my backlog spreadsheet.)

A shout-out to other colleagues reporting on the conference:

• EB-5 Update – New State Department Data Released, by Bernard Wolfsdorf, Robert Blanco, Joseph Barnett, and Vivian Zhu
• Department of Sate Gives EB-5 Backlog Projections and Anticipates Cutoff Dates, by Matthew Galati
• 7 Things We Learned from New EB-5 Program Chief Sarah M. Kendall, by Joseph Barnett

Wolfsdorf Rosenthal is holding a free webinar on 11/8 to discuss the DOS data and implications.

See also the conference program/RCBJ Business Journal available online. I particularly recommend these articles:

• Analyzing the Recent Trend of EB-5 Expedited Processing, by Joseph Barnett, Partner, Wolfsdorf Rosenthal LLP
• Summary and Analysis of Litigation to Expand EB-5 Visa Capacity, by Carolyn Lee, Partner, Miller Mayer

Regarding legislation and potential developments in Washington, I did not hear anything particularly newsworthy. Industry lobbyists say that they see hope for the future because they are finally united for the first time. This talking point would be more encouraging if we hadn’t heard the same statement last year, before the last attempt at EB-5 legislation that excluded most of the industry until the 11th hour and then met with industry discord. The panel last week did not specify compromises or concessions that have been made since then, and did not reflect specifically on what went wrong. The panel foresaw possibility for renewed legislative efforts in 2019, initiated in the House. EB-5 has best chance of getting attention after border wall funding and DACA are no longer taking all available oxygen, and after more representatives have been educated on EB-5. The panel hinted that we might be looking at more continuing resolutions in December, particularly for DHS funding if Democrats do well in the midterms. The proposal to eliminate per-country caps (in the Yoder amendment to the House version of the DHS funding bill, and H.R.392) got little mention, and no one said they thought it likely to be enacted.

FY2018 Q3 EB-5 Form Processing Statistics

After months of famine we suddenly have a feast of EB-5 numbers: data for FY2018 EB-5 form completions through September 2018 from the USCIS/IIUSA meeting on October 5, data for pending I-526 as of October 2018 from an IPO mailbox response to my blog reader, per-country I-526 data through FY2017 on sale by IIUSA, data relevant to the EB-5 visa waiting line from a wonderful panel with Charles Oppenheim at the AILA/IIUSA conference, and now official figures from USCIS for EB-5 forms received, approved, denied, and pending in the third quarter of FY2018 (April to June 2018). I’ve already reported on the first two data sets, and will cover the Oppenheim presentation in a forthcoming post when I’ve had time to process the information. As time permits, I may also do a post that tries to make sense of how these various data sets intersect, and some apparent contradictions and mysterious gaps. But for now, here are my charts highlighting trends in the official FY2018 Q3 data. The numbers come from the USCIS Immigration and Citizenship Data page, with Form I-526 and I-829 data in the Employment Based subsection, and Form I-924 data in the Forms subsection in the “All Forms Report.”

A few notes:

• Overall, IPO is receiving fewer forms and processing more forms than before. That should be a good sign for processing times at least, and will result in smaller backlogs. However, performance improvement is currently all focused on I-526. Q3 showed a record-breaking number of I-526 processed (22% improvement over the previous quarter) but drop in number of I-924 and I-829 processed.
• Q3 I-526 receipts were lower than any quarter I’ve recorded since 2013, likely reflecting concerns about visa wait time.
• In Q3, I-829 receipts exceeded I-526 receipts for possibly the first time ever.
• I-829 completion rates look terrible, with an almost-linear 65% drop in completions over the last four quarters. What’s happening, I-829 team? Why are you getting fewer and fewer I-829 adjudicated? IPO should put more resources on I-829 adjudication, considering the receipt trend across all forms.
• A surprising 51% of Form I-924 adjudicated in Q3 were denied. The denial rate for I-829 was higher than usual, at 13%. The I-526 denial rate remained at 9%.
• USCIS is not infallible when it comes to inconsistencies, and the Q3 reports contain significant revisions to the Q2 and Q1 numbers previously reported. In the I-829 reports, for example, the May report indicated 1,046 receipts in Q1, the July report indicated 694 receipts in Q1, and now the October report indicates 862 receipts in Q1. You make us doubt that you know what happened in with I-829 in Q1, USCIS! This should make USCIS recognize and sympathize with the difficulty of reporting consistent numbers, even with the best of intentions. FYI, here is my file on the ongoing mystery of the pending petition count.

Pending I-526 by country as of 10/2018

There’s an EB-5 Support page on the USCIS website that provides an email address for IPO, and instructions for how and when to communicate through the IPO mailbox. I’ve dismissed this contact option, having only heard and experienced reports that emailing the IPO mailbox yields nothing but a canned response and no action. But what do you know, sometimes it works. On October 25, 2018, IPO responded to an email from one of my readers with this extremely valuable information: “Shortly after replying to your email, Immigrant Investor Program Office management asked the webmaster to post online a table containing I-526 data. Here’s the link: https://www.uscis.gov/sites/default/files/USCIS/Working%20in%20the%20US/i526list.pdf” The link leads to a table that breaks down all I-526 pending at IPO as of October 2018 by investor country of origin and priority date. (UPDATE: USCIS removed the file in July 2019. Here is the copy I saved.) Thank you IPO management for this transparency! Program integrity depends on informed decisions, which in turn depend on information. We understand that these figures are probably subject to change since they’re so recent, and haven’t gone through the months-long review process that normally precedes public data posting. That’s just fine — our decisions need data timeliness far more than minute precision. And thank you reader for making the request and for bringing the answer to public attention. Otherwise this data treasure might have rested unnoticed on the USCIS website, or been hoarded by a few.

The charts and tables below highlight features of the data that I consider particularly interesting. The pending I-526 numbers by country help explain why Department of State predicts backlogs and visa wait times for certain countries. The pending I-526 numbers by receipt date illustrate how long currently-pending petitions have been waiting for adjudication. And the figure for total pending petitions, combined with data from other sources, suggests that I-526 receipts may have plummeted in FY2018. That’s bad news for the US economy, job creation, and destitute business plan writers like me whose revenue depends on new EB-5 demand. But it’s good news for EB-5 program sustainability. So long as the EB-5 visa cap remains at about ten thousand for investors plus family, the program can unfortunately only sustainably accommodate three to four thousand investor I-526 per year on average.

UPDATE: I’ve added a EB-5 Timing page to collect links to data and posts related to EB-5 visa availability, visa allocation, and wait times. If you would like to order a personalized timing estimate, see the EB-5 Timing Estimates Page.

FY17 per-country I-526 data, SEC action (registration)

Per-Country I-526 Data
IIUSA has received another year of per-country data for I-526 filings through the Freedom of Information Act process, and prepared a report for IIUSA members. Being ambivalent about freedom of information, IIUSA has decided to share this much with the public.
The full FOIA data set for I-526 filings, approvals, and denials FY2016-FY2017 is being sold for $1,500 (discounted to $300 for IIUSA members).

People who seek EB-5 investors will be interested to note shifts in the top six countries for EB-5 demand. Data on I-526 filings gives a better demand indicator than visas issued, since visas are usually issued 2+ years after the investment.

Past Chinese investors will note with concern the rising number of I-526 filings from other countries that aren’t oversubscribed. But Chinese can also take heart that increased demand in FY16/17 was concentrated in two countries that have (Vietnam) or will (India) exceed their cap and receive a demand-dampening cut-off date since FY2017. Only applicants from undersubscribed countries with no cut-off date can advance ahead of Chinese in the visa waiting line.

Indians will appreciate the clue to future EB-5 visa demand and wait time. Table 1 shows that Indians filed 354+587=941 I-526 from FY16 to FY17. Let’s say 941 I-526 filed * 85% I-526 approval rate * 2.9 visas per I-526 approval = 2,320 visas demanded. (I’m using historical worldwide averages as variables for this estimate, though I guess Indian approval rates may be lower and family size higher than the China-dominated average.**) About 2,320 EB-5 visas demanded by Indians * 1 year/696 EB-5 visas available to India = about 3.3 years to issue the EB-5 visas demanded by India in FY16 and FY17. 3.3 years/2 years = 1.6 more demand than supply = backlog coming. Processing time information indicates that USCIS is only just now approving I-526 from 2016, so many of those I-526 filers haven’t reached the visas application stage yet. When they do, they’ll exceed the per-country cap and lead to a visa bulletin cut-off date for India. When that will happen depends on USCIS’s speed in adjudicating I-526. The length of the visa wait time will vary for people with different priority dates. If only we had FY2018 data as well! Charlie Oppenheim at Department of State probably has these numbers, and I look forward to hearing what he has to say at the AILA/IIUSA EB-5 Industry Forum in a few weeks. I also look forward to USCIS finally publishing FY2018 Q3 data for worldwide EB-5 petitions filings (which they’re very late in doing). Because good business decisions depend on information, I continue to update and share my spreadsheet of available data related to EB-5 visa availability.

**UPDATE: I’ve since realized that DOS publishes a report of Monthly Immigrant Visa Issuances that contradicts my assumption about family size. I logged the monthly reports of EB-5 visas issued to Indians and Vietnamese so far in FY2018 (See Tab 2 Column AS of my backlog spreadsheet), with this result:

• India: 347 EB-5 visas issued Oct 2017-August 2018, of which 130 were to principal applicants (average 2.67 visas per principal)
• Vietnam: 658 EB-5 visas issued Oct 2017-August 2018, of which 171 were to principal applicants (average 3.85 visas per principal)

SEC Action on Unregistered Sales of Securities
The SEC has set a gentle example to the EB-5 community in a recent enforcement action. The SEC targeted EB-5 giant CMB Export for violations of registration requirements and improper transaction-based compensation until 2015, and settled for $11.6 million in penalties (not much, considering the amount of investor funds involved) and compliments to CMB’s compliance efforts since 2015. In its press release, the SEC emphasizes the intended moral of the story: “All securities, including EB-5 securities, must comply with registration provisions, which are essential to protecting investors. In the EB-5 industry, strong compliance policies can help ensure that companies meet their registration obligations under the federal securities laws.” Other regional centers will be interested to read the SEC Order and consider their own past and future policies. Note that previous actions have made an issue of transaction-based compensation to unregistered broker-dealers, but this is the first SEC action to target offering partnership interests without first registering the offering, or having a valid exemption from registration.

I-526 and EB-5 visa wait times; country-specific effects of potential changes

I’ve written separately about I-526 processing time and the EB-5 visa wait time, but find that people get confused about how those times interact. How does I-526 processing time affect the total time to get an EB-5 visa? From what point do we calculate the visa wait? What factors and potential changes could compress or expand the full process from priority date to green card for people from different countries?  This post addresses such questions.

Note that the path to conditional permanent residence has two separate, sequential steps (Step 1 and Step 2 in Figure 1), but we usually calculate timing for each step from the same starting point (Time A and Time B in Figure 1).  An immigrant investor’s priority date – the date that USCIS received his I-526 petition – marks his place in line for I-526 processing (which is first-come-first-served in principle) and also his place in line for a visa. An investor must wait for I-526 approval before he can take the next step and submit a visa application or file for status adjustment.  But once he gets to the visa application stage (Step 2), his place in the queue for a visa doesn’t depend on the date he finished Step 1 (I-526 approval) but on the date he started Step 1 (I-526 receipt). This is so because anyone who files I-526 is effectively putting herself in the visa queue, even though she hasn’t progressed yet to the point of being qualified to file the visa application or I-485.  INA 203(e)(1) stipulates that available EB-5 visas are issued to eligible immigrants in the order in which the immigrant petition was filed. So when Charlie Oppenheim at the Department of State Office of Visa Controls estimates a two-year wait time for Country A, he is talking about two years from priority date to visa availability, not two years from I-526 approval.  To estimate wait times for new applicants today, it’s necessary count both chickens (documentarily-qualified applicants currently ready to file for a visa) and eggs (people who have filed I-526 petitions that may eventually hatch and yield visa applications). Therefore, with reference to Figure 1:

• For an investor of any nationality, Time B is, at minimum, longer than Time A, because an investor isn’t qualified to apply for a visa until after I-526 approval.
• For investors from countries without excessive demand, Time A can be the major factor determining the length of Time B. I-526 processing times have tended to be lengthy for all countries (averaging around 2 years). But once having received I-526 approval, the investor from a country with no cut-off date will have a visa number available right away and can progress straight to the visa application or status adjustment process to claim that visa. Only investors from countries over or near the annual per-country limit need to worry about waiting years for a visa number, making Time B very much longer than Time A.
• For an investor from a country exceeding the annual 7% per-country limit, Time A becomes relatively insignificant (personally) because Time B will be long regardless of the individual’s Time A. As a Chinese investor, I may not care about the timing of I-526 approval if  have a decade to wait for conditional permanent residence regardless. The visa queue is ordered by priority date, not date of I-526 approval, so an expedite in Time A doesn’t expedite Time B for investors from significantly oversubscribed countries.
• Because the visa waiting line technically starts with priority date, we have to look at I-526 receipts, not just I-526 approvals or current visa applications, to estimate Time B. Prospective Indian investors may wonder why there’s already an informal visa wait time estimate for Indians filing today, even though India shows as current in the Visa Bulletin. That’s because today’s Visa Bulletin just reflects what’s currently happening in Step 2. The prospective investor needs to predict how the Visa Bulletin will look in the future, when he can progress to Step 2. And that future Visa Bulletin will depend on what’s happening in Step 1 now, and the volume and nationality of people entering the system and receiving priority dates.

How long is Time B, for various countries? The latest rough estimates (as of April 2018) suggest the following time between priority date and visa availability for new investors from different countries filing today: China, 15 years; Vietnam, 6 years; India, 5 years; Brazil and South Korea (and maybe Taiwan), 2 years. (Update: see estimates as of October 2018 here.) Times for everyone else are just based on estimated petition processing times, assuming no wait for a visa number. (There’s a potentially significant time factor between visa availability and actually getting a conditional green card, depending on how busy the appropriate consulate or service center happens to be, but this time is so variable that I haven’t tried to account for it in my Time B calculation.)

Many factors could change the estimates for Time B, or cause the reality to be longer or shorter for people of various nationalities who have entered the EB-5 process.

Possible Change: USCIS improves I-526 processing, increasing volume of adjudications and reducing I-526 processing times.

• Likelihood of this change: High. IPO processed 30% more I-526 in FY2017 than FY2016, and hopes to continue to improve performance
• Impact of this change, if it occurs:
  • China: Negative effect. More approved I-526 means more approvals for countries other than China, which means more visa applications from outside China and fewer leftover visas available to the China backlog. Fewer leftover visas annually means longer Time B for Chinese investors.
  • Vietnam, India, Brazil, S. Korea, Taiwan: Mixed effect. These countries are or will be too new in the backlogged category to compete for leftover visas in any case (since China has enough older backlogged applicants to claim all leftover visas for years). An increased volume of rest-of-the-world applicants may not hurt countries that can’t expect more than their personal allotment of 700 visas a year regardless. However, more and faster I-526 approvals could mean that India, Brazil, and possibly South Korea and Taiwan get cut-off dates sooner than expected. (Charlie Oppenheim knows that they’re already probably oversubscribed, based on counting eggs, but he doesn’t set cut-off dates until the eggs actually hatch into chickens, i.e. until immigrant investor petitioners are documentarily qualified to apply for a visa.)
  • Rest of the world (any countries well below 250 investors per year): Positive effect. So long as a country doesn’t risk generating over 700 visa applications in a year, its investors can only benefit from improved I-526 processing time/volume. With no hold-up to wait for a visa number, short Time A means short Time B.

Possible Change: Legislation removes the per-country numerical limit for the EB-5 category, such that individual countries aren’t limited to 7% of EB-5 visas when the category is oversubscribed.

• Likelihood of this change: Possible. Border Security and Immigration Reform Act of 2018 (H.R. 6136), the compromise immigration legislation just introduced by House GOP leadership, proposes this change in Sec. 2102 (page 192).
• Impact of this change, if it occurs:
  • China: Positive effect. With no per-country limit, the visa waiting line would simply be in order by priority date. Having been held back with cut-off dates for years, Chinese applicants have the oldest priority dates in the system. Thus, with no per-country limit, the huge pool of backlogged China-born investors would move to the front of the line for visas. Based on the number of old Chinese applications in the system, they could take 100% of available visas for the next 2-3 years, and be on equal footing with contemporary applicants from other countries thereafter. Time B for a China-born investor with priority date from 2014-2016 would decrease dramatically. Time B still wouldn’t be short for a China-born investor filing today (about 9+ years unless many previous applicants drop out, as they might), but that’s much better than the current estimate of about 15 years.
  • Vietnam, and any soon-to-be oversubscribed countries (India, Brazil, etc.): Negative effect. The per-country limit means that each backlogged country can expect to get at least about 700 visas annually. Without the per-country limit, all more recent applicants would find themselves in line behind tens of thousands of China-born applicants with earlier priority dates. Time B (currently estimated at 5+ years for new investors from Vietnam/India and 2+ years for Brazil/South Korea) would likely expand to 9+ years for all new investors regardless of country, in absence of per-country limits.
  • Rest of the world: Negative effect. The per-country limit currently protects low-volume countries from the effects of excess demand for EB-5 visas. Even with a decade of current/potential visa applications already in the system, new applicants from low-volume countries can expect a visa promptly because high-volume countries get held back. With no country-specific limits, new investors would join a line that’s about a decade long without regard to nationality.

 Possible Change: Legislation increases the number of EB-5 visas available annually.

• Likelihood of this change: Possible. We need this change so badly, and advocacy dollars should focus on this issue. But I haven’t seen EB-5 visa number increases in any recent legislative proposals – not even in H.R. 6136, which proposes additional visa numbers for every EB category except EB-5.
• Impact of this change, if it occurs: Positive for all past and future EB-5 investors from all countries.

Possible Change: Legislation or regulations implement higher minimum investment amounts that significantly depress new demand for EB-5. (Or other factors significantly depress new demand: e.g. investors in potentially-high-volume countries get discouraged by wait times, the U.S. becomes a less attractive destination for immigration or investment, EB-5 becomes a less attractive financing option for U.S. companies.)

• Likelihood of this change: High. All legislative and regulatory proposals include higher investment amounts. The most imminent proposal – regulations possibly on schedule to be finalized in August 2018 – have investment amounts high enough to kill demand almost entirely, many EB-5 promoters say. Even if investment amounts do not increase, or increase only moderately, EB-5 has plenty of challenges and complications with potential to moderate future demand.
• Impact of this change, if it occurs:
  • China: Positive effect. Fewer incoming immigrant investors means less competition from rest-of-the-world for available visa numbers
  • Vietnam, and any other high-demand countries: Positive effect. Reduced demand reduces risk for investors already in the system that their countries will become or stay oversubscribed.
  • Rest of the world: Neutral. Low future demand does not improve wait times for people already in the system from countries with no cut-off date.

Possible Change: Demand for EB-5 grows, and countries besides China produce a sufficiently high volume of EB-5 petitions to exceed the per-country limit.

• Likelihood of this change: Fairly high. The Department of State already predicts cut-off dates in the next couple years for five to six countries in addition to China. And media reports indicate aggressive EB-5 promotion outside of China, particularly in India and Brazil.
• Impact of this change, if it occurs:
  • China: Positive effect. Time B for China-born applicants depends primarily on the number of visas leftover each year from the “rest of the world” with no cut-off date. As soon as another country exceeds the per-country limit and gets a cut-off date, it’s removed from and reduces the size of that “rest of the world” pool, thus leaving more visas on the table for older China-born applicants.
  • Vietnam, and any other countries to be oversubscribed: Negative effect. Time B expands dramatically for a country as soon as it’s oversubscribed. Vietnam and subsequent countries don’t benefit the way China does from each additional country to get a cut-off date, because these countries don’t have applicants old enough to compete with China for visas leftover from the rest of the world.
  • Rest of the world: Positive effect. Each additional country to get a cut-off date reduces competition for available visa numbers.

Possible Change: Demand for EB-5 diversifies, with more investors coming from outside China, but spread out so that few individual countries exceed the per-country limit.

• Likelihood of this change: Moderate. It’s much easier to raise a lot of EB-5 money from one country than from many countries, so concentration has been the rule to date in EB-5. But data has suggested a trend toward diversification.
• Impact of this change, if it occurs:
  • China: Negative effect. Time B for China-born applicants depends primarily on the number of visas leftover each year from the “rest of the world” with no cut-off date. As that “rest of the world” pool grows, visa availability for China shrinks, and wait times grow.
  • Vietnam, and any other countries to be oversubscribed: Neutral effect. They aren’t competing for “rest of the world” visas anyway, thanks to China’s earlier priority dates.
  • Rest of the world: Negative effect. Each new applicant with no cut-off date increases competition for available visa numbers.

Possible Change: People already in line for an EB-5 visa despair about Time B and withdraw in large numbers from the EB-5 process. (Or other attrition factors come into play: more petitions get denied, more projects fail, more deaths and divorces occur, children age out or don’t get born.)

• Likelihood of this change: Moderate. On the one hand, current wait time estimates are devastating for some investors (especially, China-born investors in the past couple years), undermining their immigration objectives and their investment projects. This could precipitate voluntary withdrawal, not to mention attrition from children growing up and more time for divorce and death and project failure. On the other hand, EB-5 investments are major and real at-risk investments, committed regardless of the immigration process. Giving up is not easy. Also, many people do not read my blog and are not well-informed about timing issues.
• Impact of this change, if it occurs:
  • China: Positive effect for some. Each China-born applicant who withdraws from the process reduces the time that more recent China-born applicants have to wait for a visa.
  • Vietnam, and any other countries to be oversubscribed: Mixed effect. Mass exodus of past investors would reduce competition for available visas, but also involve collateral damage to the EB-5 program as a whole (in terms of public relations and damage to companies deploying EB-5 investment, not to mention the human cost for the prospective immigrants involved).
  • Rest of the world: Mixed effect. Countries without cut-off dates do not compete with the backlog anyway, so reducing the backlog has little effect on timing for these countries. But large-scale failure of previous EB-5 applications would damage the EB-5 program as a whole.

Other related posts:
AILA/IIUSA Forum Updates (Kendall, Oppenheim, visa availability) November 5, 2018
Visa Numbers (FY2018 Q3 and conference update) July 27, 2018
How Long Does I-526 Take? (III) May 18, 2018
Visa Numbers (China, Vietnam, India, Brazil, S. Korea, Taiwan) April 23, 2018
EB-5 Visa Waiting Line and Visa Allocation April 8, 2018
EB-5 Timing Issues and Visa Wait: Process and Data October 13, 2017

Benefit from this blog? Please support the effort behind it. As the EB-5 industry changes, your contribution can help preserve this space for conscientious and freely-available EB-5 reporting. Contributions go to Lucid Professional Writing, a for-profit business, to fund work on this blog. Thank you!

How Long Does I-526 Take? (III)

8/2019 UPDATE: I-526 timing factors and calculations have changed significantly and become more complicated in 2019. I am not updating this post because it still reflects officially-provided information, while my more recent insights are mainly from unofficial/uncitable sources. I have set up a timing estimate service, for anyone who would like a personalized calculation and estimate based on most recent data and rumors from IPO regarding I-526 processing.

— Original Post —

This post combines, updates, and replaces my two previous posts on I-526 processing times. I’ve divided the post into six sections:

• Interpreting Official USCIS Processing Time Information
• Predicting Average Processing Times
• Understanding Variation in Processing Times
• Expedited Processing
• Individual Processing Time Experience
• Resources for Investors

How much time does USCIS take to process an I-526 petition? The short answer: usually between 3 and 33 months. The rest of this post provides the long answer.

Interpreting Official USCIS Processing Time Information

USCIS addresses the processing time question on the EB-5 filing tips page:

How long does USCIS take to process a Form I-526 petition?
For current estimates, see USCIS Processing Time Information. However, processing times can vary depending on the circumstances of each case. These include factors such as the time it takes to complete a background check and whether we need to request additional evidence.

Since, March 23, 2018, the USCIS Processing Time Information page for I-526 has looked like this:

The report claims that “We generally process cases in the order we receive them,” and provides two pieces of information: an estimated time range, and a case inquiry date.

• What “Estimated time range” means:  This month range gives a theoretical average processing time and an upper limit. The lower number (25 months) is an average that’s calculated by dividing the number of I-526 petitions pending at IPO by the average number of petitions that IPO has been processing in a month. The higher number (32.5 months) is “generally” the lower number multiplied by 1.3. Cases that take longer than 32.5 months to process have exceeded an arbitrary “upper limit” for “normal” processing times, and considered outliers. The month range provides a reasonable theoretical estimate for I-526 processing times. However, we have no evidence that the dates broadly reflect the actual ages of cases currently being adjudicated at IPO. Quite the contrary, in fact, as discussed below. (Source of my interpretation: USCIS’s More Info page, which says that we “continue to use our old method to calculate processing times” for non-pilot forms such as I-526, combined with an Office of Inspector General report exposing the “old method” for calculating processing times in the I-485 context, and corroborated by reproducing USCIS’s presumed time range calculation using public data on I-526 pending petitions and volume of adjudications.)From March 23, 2018 to May 18, 2018, the Processing Time Information Report Estimated Time Range for I-526 has remained unchanged: 25 to 32.5 months. Since the Estimated Time Range appears to be a broad theoretical calculation, not dependent on fluctuating reality, I expect it to remain unchanged in the report indefinitely, regardless of what’s happening on the ground at IPO. [Update: on 5/31/2018, the report was updated to show 20-25.5 month range for I-526.]
• What “Case inquiry date” means: As the Processing Time Information page explains,
  

  We have posted a Case Inquiry Date … to show when you can inquire about your case. If your receipt date is before the Case Inquiry Date, you can submit an “outside normal processing time” service request online.

  From March 23, 2018 to May 18, 2018, the Case Inquiry Date for I-526 has remained constant: today’s date minus 971 days. (I spot check the webpage periodically, and log the reports in my IPO Times file.) The webpage claims that the report gets updated “around the 15^th of each month,” but that has not been true yet.

  Like the Estimated Time Range, the Case Inquiry Date appears to be merely theoretical and functional. It’s more-or-less simply the upper end of the Estimated Time Range, converted from a month into a calendar date. It does not claim to be the date of cases that IPO is processing now. It’s just the cut-off date that IPO has set for complaints – and naturally IPO would choose to put that date back as far as possible. If you want to estimate when you may start to complain, add 971 days to your priority date. But your I-526 will get a decision before that date, unless it’s an outlier. And I predict that variable currently set at 971 will be adjusted downward eventually, assuming that IPO continues to improve processing speed. [Update: on 5/31/2018, the report was updated to show I-526 case inquiry date of 761 days ago, rather than 971 days ago]

Predicting Average Processing Times

Average processing time is theoretically a function of inventory (number of pending petitions) and flow rate (rate at which IPO approves and denies petitions). You can get the input data for this equation from the USCIS Immigration and Citizenship Data page, which posts quarterly reports for I-526 and other forms. My I-526 Time spreadsheet turns the quarterly data into a prediction model that estimates average processing times as a function of petition volume at different points in time (with some assumptions about future trends). The last quarterly report indicated 24,627 I-526 pending at IPO in December 2017 and an average of 2,954 petitions processed per quarter over the last four quarters. 24,627/2,954 = 8.3 quarters to process the pending petitions (estimated average). So an I-526 petition filed in January 2018 would be theoretically likely to wait 8.3 quarters (25 months) for processing, other factors being equal. That’s consistent with the Processing Times Information page, which starts the Estimated Time Range at 25 months. But unequal reality leads to some petitions being processed more quickly.

Understanding Variation in Processing Times

Here’s what IPO has said about I-526 time variation (summarized from communications copied in my log of IPO communications on processing times).

• DHS estimates that the average Form I-526 gets 6.5 hours of touch time.  That means an adjudicator spends less than a day handling the case —  the remaining (and most variable) processing time is queue time and time spent waiting for additional evidence or supervisory approval.
• IPO has at least three queues going for I-526 petitions: (1) a queue for direct EB-5 petitions; (2) a queue for regional center petitions based on investment in projects that haven’t yet been reviewed; (3) a queue for regional center petitions based on investment in projects that have Exemplar I-526 approval or previous I-526 approvals.  The following chart illustrates my understanding of IPO Deputy Chief Julia Harrison’s description of the process.
  
  IPO indicates that each queue has dedicated staff working on it. Petitions within each queue are ordered by earliest filing date. A regional center petition for a project not previously reviewed must wait in Queue 2 (for project-specific adjudication) and then again in Queue 3 (for investor-specific adjudication). RC petitions for previously-approved projects advance straight to Queue 3. IPO encourages communication between team leaders on the Queue 1 and Queue 2/3 side to ensure that direct and RC petitions filed at the same time move forward concurrently. With this complex process, it’s unsurprising that IPO appears far from its intention to process cases more-or-less in the order in which they are received.
• Factors that can speed I-526 processing per IPO:
  • Investing in a project with an approved Exemplar and/or previously-approved I-526
  • Having a clear, high-quality petition (this is important when evidence requests and supervisory approval are the major variables — besides queue time — in overall processing time)
  • Having an approved expedite request (this shortens the queue time, not the adjudicator touch time).
• Factors that can slow I-526 processing per IPO:
  • Having a petition that’s poor-quality, unclear, problematic, or otherwise inspires IPO to request additional evidence
  • Filing with/after a surge of other people who filed poor-quality petitions
• Factors that don’t affect I-526 processing time per IPO:
  • The investor’s nationality. (IPO does not currently sort petitions by nationality. There is no hold-up for China-born petitioners at the I-526 stage, as there is at the visa stage. However, IPO asks whether they should change that — considering that fast I-526 approval doesn’t help China-born investors facing a long visa wait regardless. Also, stats show that I-526 denial rates are much higher for some countries than others, which makes me suspect that IPO finds some countries’ source of funds and background checks more challenging than others – which could naturally be associated with longer processing times. So even if the process is FCFS for all nationalities, it’s probably not FIFO for all nationalities.)
  • Whether the petition is for a direct or regional center investment. (IPO claims that they try to move direct and RC petitions forward concurrently. However there may be some regional center advantage in practice since direct petitions are often the first in a project and cannot take advantage of Exemplar approval.)
  • Project size. (IPO reports that they do not privilege petitions for big projects with many investors. But some anecdotal evidence suggests otherwise.)
  • TEA status. (Some legislative reform proposals have suggested offering quicker processing to petitions based on investment in a Targeted Employment Area, but IPO does not report having any such policy now.)

Expedited Processing
EB-5 forms, like other immigration forms, can apply for and benefit from expedited processing under certain limited conditions. Expedited processing reduces the time a form takes to reach an adjudicator’s desk. It does not reduce the time to adjudicate the petition, and does not reduce the visa wait time for petitioners from countries with a cut-off date.

• For official information, see https://www.uscis.gov/forms/expedite-criteria
• Here is the most balanced and helpful article I’ve read on the topic: Analyzing the Recent Trend of EB-5 Expedited Processing by Joseph Barnett, Partner, Wolfsdorf Rosenthal LLP (originally published in the 2018 Q3/4 Regional Center Business Journal)
• This article gives historical context: Anatomy of a Successful EB-5 Expedite Request (May 2013)
• This article gives the perspective of counsel representing a client who promotes expedited processing: Successful Expedited Case Processing in EB-5 (September 2018)
• This article provides a critique: The Great EB-5 “Expedited Processing” Debate: The Issue of “False Inducement” (September 2018)

Individual Processing Time Experience

Individual processing time variation means that some people wait longer than the theoretical average 25 months for I-526 approval, while others receive approval much more quickly.

My best evidence for faster-than-average approval is priority dates for pending visa applications. If all I-526 take 2 years to process, then Department of State should have been receiving applications in 2017 from people who filed I-526 in 2015. In fact, as of October 2017 Department of State reported having over 1,500 pending visa applications based on I-526 petitions filed in 2016 and 2017. Assuming an average 3 visa applications per approved petition, that reflects about 500 I-526 petitions approved and advanced to the next stage within a year of filing. And the DOS report only mentioned pending applications for five countries, not counting all applications for the year. I-485 inventory statistics likewise show many pending status adjustment applications with recent priority dates.

I set up a Google Form to collect reports of processing time experience from individual investors. (Entries still welcome!) In the very limited sample of entries so far (which appear in this Google Sheet), I-526 approvals in 2017/2018 that were reported to me had an average processing time of 19 months, with standard deviation of 7 months. The following tables summarize results reported in my Form so far.

Resources for Investors

• I set up an EB5 Forum for investors to discuss EB-5 experience. (Right now it’s private but anyone’s free to join – just sign up. I participate in the conversation occasionally as I have time.)
• Some blog readers have set up a group using the Telegram app to share I-526 experience. I’m not on this myself, but I hear that discussion has been lively. Here’s the link to join: https://t.me/EB5VisaGroup If you know of other social media for EB-5 investors, alert me and I’ll publish links here.
• Here’s my I-526 Time spreadsheet with data and prediction tool, and my log of communications from USCIS regarding processing times. Keep the links; I update the files regularly as new information becomes available.
• My post I-526 and EB-5 visa wait times; country-specific effects of potential changes (June 18, 2018) examines the separate question of the time to get an EB-5 visa (conditional permanent residence).
• Helpful article: Options for EB-5 Investors When Form I-526 Petitions Are Pending Too Long (Wolfsdorf Law)

Additional Note

My series of timing posts is missing an important piece: analysis of the steps and time factors (for countries with no cut-off date yet) between receiving the Form I-797, Approval Notice for the I-526 and claiming an EB-5 visa number. Especially Indians are trying to calculate: if I can count on receiving I-526 adjudication in the next few weeks, can I count on getting allocated a visa number in the advance of the Visa Bulletin giving a cut-off date for India? The point at which the visa number actually gets allocated, and the factors/timing between I-526 approval and that point, vary between I-485 and consular processing, and I don’t understand it all yet. But potential investors should include this in discussions with counsel, because delays can be considerable for consular processing anyway. I’m hearing reports of USCIS taking  8+ months just to forward I-526 approvals to the National Visa Center. Ironically, it seems that the faster USCIS adjudicates I-526, the more it drags its feet on advancing that approval to the next stage. But this is a developing situation, and I have limited examples. Here is my background reading list so far FYI. Please email me any additional helpful articles and current timing information.

• NVC Timeline for Consular Processing (October 11, 2017) Miller Mayer
• Adjustment of Status Process (June 20, 2017) Miller Mayer
• The Operation of the Immigrant Numerical Control System Department of State
• The “Red Combo Card” Option for EB-5 Indian Nationals – Will It Work? (September 8, 2018) Wolfsdorf Rosenthal

UPDATE: I’ve added a EB-5 Timing page to collect links to all data and posts related to EB-5 visa availability, visa allocation, and wait times. If you would like me to make a timing estimate personalized to your situation, see the EB-5 Timing Estimates Page.