Washington Updates

EB-5 Program Status Topics:

Subject to frequent change; updated as of 2/16/2018

Calendar Summary

  • February __, 2018: The date indicated for posting a Final Rule for regulations on EB-5 program modernization (precise content and effective date unknown til we see the final rule, but it will change the EB-5 investment amount and TEA definition, among other provisions)
  • March 5, 2018: The date DACA protections are slated to end, and thus the date Congress is pushing to beat in passing a big immigration bill
  • March 23, 2018: The date when current government funding (and regional center program authorization) will expire, and the deadline for passing a new spending bill that could be a vehicle for longer-term RC program authorization
  • April-May 2018: The possible effective date for new EB-5 regulations, assuming that the rule is finalized in February with an effective date after 60-90 days

Legislation that could affect EB-5

Recent articles:

I do not know of any imminent EB-5 related legislation in Washington, and have just heard vaguely of negotiations with staffers behind the scenes. The funding omnibus that needs to be passed before March 23 seems to be the best hope for a longer-term RC program authorization and other program improvements. Attempts at comprehensive immigration legislation look doomed, and in any case none of the proposals so far have included provisions that would affect EB-5.

FYI here is my log of previous legislative proposals that would affect EB-5. (None are currently active, so far as I know.)

S.2344 – Immigration Innovation Act of 2018 (Senators Hatch, Flake) would free up employment-related visas in a way that would help EB-5 among other categories. But I doubt the it will gain any more traction this time than it did before, since it doesn’t fit in the administration’s immigration framework, and Hatch and co-sponsor Flake have already said their goodbyes to the Senate. The Hatch bill text does not, as misreported in some media, include RC program reauthorization or any direct reference to EB-5.

Regional Center Program Authorization

Regional center program authorization is currently extended through March 23, 2018IIUSA says “We believe that this new deadline on March 23rd will be the first time since December of 2015 that EB-5 reform could realistically have a legislative vehicle for reform and a long-term reauthorization. This gives Congress and the EB-5 industry six more weeks to come to a consensus on EB-5 negotiations.”

FYI, for inquiring minds, here’s the trail of language linking regional center program authorization to the CR passed on February 9, 2018:

  • Public Law 115-123 (H.R.1892 – Bipartisan Budget Act of 2018) Title 4 Subdivision 3 SEC. 20101 (PDF page 57) says “The Continuing Appropriations Act, 2018 (division D of Public Law 115–56) is further amended by—(1) striking the date specified in section 106(3) and inserting ‘‘March 23, 2018’’ …. which refers back to:
  • Public Law 115–56 Division D Section 106 (PDF page 13) which saysUnless otherwise provided for in this Act or in the applicable appropriations Act for fiscal year 2018, appropriations and funds made available and authority granted pursuant to this Act shall be available until whichever of the following first occurs: … (3) December 8, 2017.”  Division D Section 101 (PDF page 11) specifies that the authorities granted pursuant to the act include “continuing projects or activities…for which appropriations, funds, or other authority were made available in the following appropriations Acts: … (6) The Department of Homeland Security Appropriations Act, 2017 (division F of Public Law 115–31), except section 310” … which refers back to:
  • Public Law 115-31 Division F, which specifies regional center program authorization in Section 542 (PDF page 432) “Section 610(b) of the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 1993 (8 U.S.C. 1153 note) shall be applied by substituting ‘‘September 30, 2017’’ for ‘‘September 30, 2015’’ … which refers back to:
  • Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 1993 (Public Law 102-395) Section 610 (PDF page 47), established the regional center program: “SEC. 610. PILOT IMMIGRATION PROGRAM.—(a) Of the visas otherwise available under section 203(bX5) of the Immigration and Nationality Act (8 U.S.C. 1153(bX5)), the Secretary of State, together with the Attorney General, shall set aside visas for a pilot program to implement the provisions of such section. Such pilot program shall involve a regional center in the United States for the promotion of economic growth, including increased export sales, improved regional productivity, job creation, and increased domestic capital investment. (b) For purposes of the pilot program established in subsection (a), beginning on October 1, 1992, but no later than October 1, 1993, the Secretary of State, together with the Attorney General, shall set aside 300 visas annually for five years to include such aliens as are eligible for admission under section 203(bX5) of the Immigration and Nationality Act and this section, as well as spouses or children which are eligible, under the terms of the Immigration and Nationality Act, to accompany or follow to join such aliens.”

The last time Congress voted a significant regional center program extension was 2012. Since then, the program has been extended a few months at a time, in connection with government funding. When Congress finally manages a new funding bill through September 30, 2018, it will need to make a positive decision to include RC program authorization – which might be a months-long clean extension as in previous years, with no changes, or could incorporate a longer-term authorization with changes that would affect EB-5 investors generally. Or Congress could choose to to terminate the RC program, but past termination calls didn’t get momentum and I haven’t heard any such talk recently.

EB-5 Regulations

RIN 1615-AC07 (EB-5 Immigrant Investor Program Modernization) is a regulation designed to raise the minimum EB-5 investment amount, allow certain EB-5 petitioners to retain their original priority date, change the designation process for targeted employment areas, and make other miscellaneous changes to filing and interview processes. We had opportunity to review and comment on the draft rule in 2017. The final rule is expected to be posted in February 2018, and could take effect 30 to 90 days later. A second EB-5 regulation, related to regional center operations, is still in a preliminary stage.

Implications for Past & Future EB-5 Users

1. What happens if the regional center program is terminated?

If Congress moves to terminate the RC program, one hopes that the move will come with new language that protects good-faith regional center applicants already in the system. (I estimate about 95,000 people, regional center investors and family, are currently in the pipeline between I-526 filing and I-829 filing.) Current policy treats regional center termination as a material change that would abort the process for people waiting on a green card, but does not address what would happen were the entire program terminated.

Policy Manual 6 USCIS-PM G Chapter 4(C): Changes that are considered material that occur after the filing of an immigrant investor petition will result in the investor’s ineligibility if the investor has not obtained conditional permanent resident status. …Further, the termination of a regional center associated with a regional center immigrant investor’s Form I-526 petition constitutes a material change to the petition.

Policy Manual 6 USCIS-PM G Chapter 5(C): Further, with respect to the impact of regional center termination, an immigrant investor’s conditional permanent resident status, if already obtained, is not automatically terminated if he or she has invested in a new commercial enterprise associated with a regional center that USCIS terminates. The conditional permanent resident investor will continue to have the opportunity to demonstrate compliance with EB-5 program requirements, including through reliance on indirect job creation.

Direct EB-5 is not subject to reauthorization, and could continue as-is regardless of whether or not the regional center program is reauthorized

2. What happens if regional center program authorization lapses as part of a government shutdown?

See this post https://www.natlawreview.com/article/government-shutdown

3. Would any EB-5 program changes retroactively affect people who have filed I-526?

  • If the regional center program loses authorization, that would affect people who have already filed and depend on the regional center program for continued eligibility. (See question 1 above)
  • Changes to investment amounts and TEA rules proposed by the regulations would only apply to new petitions after a future effective date
  • Some people in Congress have called for investment amount and TEA changes to be applied retroactively to past investors, but there isn’t any current legislation on the table to this effect, to my knowledge.
  • Recent legislative proposals have suggested setting aside some visas as incentives for TEA investment. This could affect past applicants by reducing the visas available to them and making the backlog and visa wait time even longer.
  • If legislation increased available EB-5 visa numbers, people already waiting for a visa would benefit.
  • The priority date protection and I-829 process changes proposed by the regulations would affect people currently in the system.

4. Would proposed EB-5 changes affect direct EB-5?

Changes to investment amounts and TEA definitions would equally affect direct EB-5 and regional center EB-5. The main difference is that direct EB-5 doesn’t depend on re-authorization, and integrity measures in proposed legislation have largely ignored direct EB-5.

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