On January 28, 2015, two members of Congress, Jared Polis and Mark Amodei, officially submitted a bipartisan proposal to make the EB-5 program permanent. To some extent, this proposal can be seen as a result of the recent calls for reform in the EB-5 investment immigration sector, elevating the industry's reform demands to the level of legislation. This is indeed significant good news for the entire U.S. investment immigration community. Overall, this legislative proposal plays a crucial role in advancing the EB-5 reform process. Regardless of whether it ultimately passes, our wisest course of action is to respond to change with consistency and remain vigilant.
Here, we briefly share the contents of this immigration reform proposal.
1. Reform of the EB-5 Investment Immigration Program:
Preventing fraud in regional centers: Individuals who have committed civil or criminal fraud within the past five years, have been sentenced to more than one year in prison, or have been involved in securities fraud or money laundering cannot serve as owners, directors, or hold significant decision-making positions in regional centers. The Department of Homeland Security needs to collaborate with the Department of Commerce to jointly customize strategies for reviewing securities-related materials in immigration applications.
Reform of EB-5 Immigration Law Section 201(b)(1): Section 201(b)(1) needs to be supplemented regarding visa quota issues, stating that the spouse and children of investors should not be counted against the visa quota. After the conditions are removed, the principal applicant is allowed to have unmarried children under 21 years of age join the application within one year.
Reserve no fewer than 5,000 visa slots for investors in Target Employment Areas (TEA).
The definition of Target Employment Areas (TEA) will be determined by state governments, and the Department of Homeland Security should adhere to the designations made by state governments. Once an area is designated as a TEA based on census data, the designation will be valid for two years.
Regional centers: The primary purpose of establishing regional centers is to promote economic development, including increasing exports, regional productivity, employment, and domestic investment in the United States. Based on the plans provided, approved by the Department of Homeland Security, the Department of Commerce may offer opinions. Each regional center will have jurisdiction over a specific area, and its plan must include: 1) a new commercial enterprise that will accept foreign investor funds; 2) jobs created directly or indirectly by that investment; 3) other beneficial economic effects.
Employment models: The Department of Homeland Security, with consultation from the Department of Commerce, should recognize reasonable employment calculation models proposed by regional centers, including income generated from increased exports, improvements in regional productivity, or increased domestic investment.
Pre-approval: The Department of Homeland Security should establish a pre-approval process, allowing a regional center (or one that is applying) to seek approval for its new commercial enterprise from the Director of Homeland Security before foreign investors invest. This practice allows regional centers to supplement missing information before the immigration agency makes a final decision on the new commercial enterprise (project) and reduces the need for individual investors to submit duplicate project materials during their applications.
Compliance with previously approved applications: After the pre-approval process, except for material changes, fraud, or legal defects, the Department of Homeland Security should comply with previous decisions when reviewing investor immigration applications (I-526) and condition removals (I-829) for a particular commercial enterprise (project).
Approval time: The Department of Homeland Security should make a decision within 180 days of the application submission. If additional materials are required, a decision must be made within 30 days of receiving those materials.
2. EB-5 Visa Reform:
(1) Remove the visa number limits for each country.
(2) Amend Section 201(b)(1) of the Immigration and Nationality Act to include the principal applicant's spouse or children in the category of applicants not subject to direct numerical limitations.
(3) Establish age standards for investor children: If an investor's child submits an application before turning 21, as long as the child is unmarried and submits a permanent green card application within one year after the conditions of their temporary green card are removed, the child should not be considered to have aged out.
(4) Allow concurrent applications: When an applicant submits an application under Section 203(b)(5) of the Immigration and Nationality Act, if this application would allow the foreign investor's beneficiaries to immediately obtain a visa, then those beneficiaries should be allowed to concurrently submit a change of status application.
WorldWay Immigration experts analyze: We should maintain a rational and dialectical attitude towards the industry's calls for EB-5 reform and actions. Regarding this legislative proposal, it is indeed rare and systematically presents a complete set of EB-5 reform proposals, further advancing the EB-5 reform process from a legislative perspective. However, some contents of this proposal may be overly idealistic or counterproductive, potentially diminishing its effectiveness. Specifically, the new law has the following six major benefits:
Six Major Benefits of the New EB-5 Law:
1. Precisely define Target Employment Areas
When determining whether a certain area is a Target Employment Area, relevant government departments must make decisions based on reasonable and accurate data (including data from the U.S. Census Bureau and the Bureau of Labor Statistics). Furthermore, once an area is designated as a Target Employment Area, that designation will remain valid for two years. This measure further clarifies the standards for reviewing Target Employment Areas, allowing all parties involved in EB-5 to better assess investment risks and project conditions.
2. Expand the calculation of indirect jobs
The legislative proposal requires the Department of Homeland Security to consult with the Department of Commerce to develop reasonable job calculation methods and expand the scope of indirect job calculations. This undoubtedly increases the chances of success for investors and project developers.
3. Clearly define approval times
This legislative proposal clearly limits processing times: the approval time for visa applications from regional center investors must not exceed 180 days, and in cases where additional materials are required, the approval time must not exceed 30 days from the date of receipt of those materials. If the submitted materials do not meet the requirements for approval, the Department of Homeland Security must issue a written notice to the submitter within 30 days and provide an opportunity for correction. This significantly shortens the approval time, making the waiting period for investors much less prolonged.
4. More standardized regulation of the EB-5 industry
To combat the fraud issues that have emerged in EB-5 projects in recent years, the proposal strengthens the regulation of fraudulent activities. According to the contents of the proposal, the Department of Homeland Security will conduct background checks on the leaders and key personnel of regional centers, and individuals with blemishes will not be allowed to hold important positions. The Department of Homeland Security should also work with the U.S. Securities and Exchange Commission to establish review standards for securities materials in visa application materials or applications for the removal of temporary green card conditions.
5. Eliminate country-specific limits, increasing the success rate for applicants' families
By redefining the age standards for investors' children, allowing concurrent submission of change of status applications, including the principal applicant's spouse and children in categories not subject to direct numerical limitations, and increasing the number of investor visas for new enterprises, the legislative proposal aims to effectively improve the success rate of applicants and their family members, enabling more investors to successfully obtain U.S. permanent green cards alongside their families while investing funds in the United States.
6. Potentially alleviate visa backlog warnings
If the spouse and children of investors are not counted against the visa quota, the number of EB-5 visas issued each year could increase several times, potentially temporarily alleviating and delaying the onset of visa backlogs.
Responding to Change with Consistency: A Calm Perspective
We should always maintain a rational and calm attitude towards the industry's calls for EB-5 reform and actions. Regarding this legislative proposal, it is indeed rare and systematically presents a complete set of EB-5 reform proposals, further advancing the EB-5 reform process from a legislative perspective. However, whether this proposal can be passed in the near future remains uncertain. Investors should respond to change with consistency and calmly view this positive news.
Currently, there is a consensus in the immigration industry that visa backlogs, price increases, and policy changes are three major crisis events that will inevitably occur in U.S. investment immigration in 2015. Making a decisive choice of projects before the policy changes in 2015 is the best strategy to prepare for these three crises. Now is precisely the last golden period for U.S. investment immigration. To reduce approval times and strive for a successful outcome in one go, it is urgent to choose high-quality projects that have been approved by the immigration agency.
As a leading brand in U.S. immigration, WorldWay Immigration Group has focused on the concept of selecting quality projects for 18 years, creating numerous historical precedents in the U.S. immigration industry. In terms of selecting projects and effectively reducing risks, we are better suited to adapt to the new normal of "projects are king" during this critical period of U.S. investment immigration. Recently, WorldWay Group has comprehensively analyzed the many factors that will impact U.S. investment immigration applications in 2015 and has carefully selected two projects that have received I-924 approval from the U.S. immigration agency: the New York Liberty Garden Luxury Apartment Project and the Pennsylvania Highway Project.
The New York Liberty Garden Luxury Apartment Project stands out among numerous real estate EB-5 projects due to its prior I-924 approval from the U.S. immigration agency, making it an essential choice to address the EB-5 visa backlog in 2015. Moreover, the New York Liberty Garden Luxury Apartment Project boasts a high net asset guarantee of 14.5 times, and the developer, Lightstone Group, is one of the largest and most successful private real estate developers in the United States, with the founder providing a personal asset guarantee of 11.7 times.
The Pennsylvania Highway Project has received I-924 approval from the U.S. immigration agency and is funded by a loan from the state government, which has committed to repayment, making it a 100% U.S. government EB-5 project. The first phase of the Pennsylvania Highway Project was sold out in just two months. Currently, the second phase of the Pennsylvania Highway Project is experiencing even more enthusiastic demand than the first phase. For more information about the two approved U.S. investment immigration projects, please call 400-138-2929.
