Lame-Duck Congress Ignores Chance For EB-5 Reforms

The EB-5 immigrant investor visa program bolsters the U.S. economy through capital investment and job creation. Each year, up to 10,000 EB-5 visas are offered to international investors who place a minimum of $500,000 into development projects or into other investments that create at least ten full-time jobs for U.S. workers. The investor and his or her qualifying family members will receive green cards after two years, provided that the ten or more jobs have been created and that all other EB-5 requirements have been met.

EB-5 visa applications nearly tripled from 2013 through 2015, but the visa’s popularity has also exposed what critics say are serious flaws with the way the EB-5 investor visa program operates. Just before leaving Washington for the holidays, the last Congress renewed the EB-5 visa program for another four-and-a-half months as part of a year-end spending bill. Despite the controversies that surround the program, no reforms were made in 2016. Senate Judiciary Committee Chairman Chuck Grassley, one of the lawmakers who believe the program needs reform, said, “After another year, we have yet another missed opportunity.”

The EB-5 program – and the several controversies associated with it – will now be inherited by a new President and a new Congress. The EB-5 program was initially established during the first Bush Administration to encourage international investors to place considerable amounts of capital into new U.S.-based business ventures. In the years since, Congress has enhanced the EB-5 program’s appeal to foreign investors in a number of ways, including a less precise definition of job creation and a lower minimum investment amount.

WHAT IS THE APPROVAL RATE FOR EB-5 APPLICATIONS?

International investors have responded with rising interest in the EB-5 program, and the approval rate for the EB-5 visa is about 90 percent. The EB-5 offers international investors a path to U.S. citizenship if they invest at least $1 million in most instances, although a half-million dollar investment is the minimum that’s required if the investment is in an economically-depressed region.

A Government Accountability Office report published in September 2016 says that the Department of Homeland Security is currently addressing several potential fraud risks in the EB-5 program. And despite the President-elect’s well-known opposition to undocumented immigration, some advocates of the EB-5 are even expecting the program to flourish under the new Trump Administration.

“His strong stance [is] against illegal immigration,” said former New York Governor George Pataki at a recent investment conference in China. “And EB-5 is a legal immigration program. He understands the need for capital, the need for investment.” The executive director of the U.S. Immigration Fund, Charles Gargano, also believes that the EB-5 program will thrive because of Mr. Trump’s own experience as an investor. “Under President-elect Trump, a developer himself, he will magnify the need for a program like this,” Gargano explained to the same conference in Shanghai in November.

HOW SOON ARE EB-5 REFORMS LIKELY TO HAPPEN?

Mr. Trump’s son-in-law, Jared Kushner, is in charge of a Jersey City complex that has purportedly leveraged $50 million in EB-5 funds as a portion of its financing. And despite broad agreement that the EB-5 visa program needs reform, drastic change isn’t likely under the new administration and new Congress, according to David North, a spokesperson at the Center for Immigration Studies. “I don’t think the program’s going to get killed,” North adds.

Advocates of the EB-5 program say that more than $11 billion in investments and more than 220,000 U.S. jobs will vanish if the EB-5 visa program is eliminated. Peter D. Joseph, the executive director of the EB-5 trade group Invest in the USA, says, “We’re working for important reforms that improve rigorous vetting of projects and investors, so that the program can continue investing in communities and providing quality American jobs.”

The previous Congress made no changes to the EB-5 program in 2015 and 2016. A number of reform proposals were offered, but in the end the program was renewed without change. For now, to obtain an EB-5 visa, a foreign investor must put at least $1 million into a new U.S. business that creates ten or more full-time U.S.-based jobs, or the investor must put at least $500,000 into a “Targeted Employment Area.” An applicant must also prove that his or her investment dollars were received legally and legitimately. This requirement helps to ensure that the EB-5 program is not dealing with money laundered by crime networks or terrorists.

WHAT ARE EB-5 REGIONAL CENTERS?

Most EB-5 international investors work with the EB-5 Regional Center Program. Regional centers are private-sector groups that pool investment funds to develop resorts, hotels, retail centers, and other major projects. From 2005 through 2013, the EB-5 investor visa program brought more than $5 billion into the United States. Foreign investors can best take advantage of the EB-5 program by working from the start with an Ohio immigration attorney who routinely helps investors dealing with immigration issues. There is an annual cap – only 10,000 EB-5 visas are offered annually – so investors should initiate the application process as early as possible.

Anyone with any questions or concerns regarding the EB-5 investment visa or any immigration matter should speak as soon as possible to an experienced U.S. immigration lawyer. If you are an international investor considering a business investment in the United States, let an experienced Ohio immigration attorney work on your behalf. You can arrange for a consultation by email or by calling from anywhere in the world. The economy is rising strong once more in the United States, and excellent investment opportunities are found in every one of the fifty states.

All qualified international investors may petition for an EB-5 visa. The EB-5 visa does not require a sponsor or a labor certification. Through the EB-5 investor visa program, the U.S. allows international investors to invest in U.S.-based businesses and to live here with their immediate families. As the conditions of the EB-5 visa are satisfied, investors and their families qualify to receive green cards. Learn more about the EB-5 visa and other options for investors by speaking with an Ohio immigration attorney. The EB-5 visa is an excellent path to lawful permanent residency in the United States for the willing and able international investor.