Dear EB-5 Clients and Strategic Partners,
I write today to provide you with an update on the EB-5 Regional Center Program (the “Program”), the authorization of which has been lapsed since July 1, 2021.
In sum, through the present date, Congress has not taken any meaningful public action since late June in attempts to pass reauthorization legislation. Accordingly, the Program is in substantially the same place that it was on July 1. Future opportunity to reauthorize the Program may present itself in February; however, it is currently too early to tell whether reauthorization or protections for existing investors may materialize at that time. Cases remain held in abeyance through Dec. 31, 2021. We have no evidence at this time that USCIS will deny or revoke any benefit thereafter.
Our opinion as of this time is that it remains more likely than not that legislative relief will be coming, although we cannot accurately predict the form and timing of that legislation.
To recap, the United States Senate sought to reauthorize the Program through unanimous consent in late June. The legislation that was then contemplated was somewhat controversial, which is a topic for another day. One senator objected to the request, and accordingly, the legislation did not move forward. Virtually no action has taken place on the floor of the Senate or the House of Representatives since that time.
But lack of action is not due to a lack of effort. Various EB-5 industry groups, including those with primarily Regional Center constituencies (such as IIUSA and EB-5IC), as well as the investor-driven American Immigrant Investor Alliance (“AIIA”), have expended enormous time and effort in trying to advance legislation that would reauthorize the program or, at least, allow all existing investors and their families to be processed in the normal course.
AIIA has received assurances from House Judiciary that they will assist with protective legislation if reauthorization ultimately fails. We have heard reports from representatives from IIUSA and EB-5IC that they have united on “consensus legislation” that would modernize and reauthorize the Program. Despite rumors to the contrary, our Firm has direct knowledge that this consensus legislation has been sent to various Congressional Member and Committee offices for review and markup. It is, however, unclear at this time how this proposed legislation has been received. It has not yet been introduced in either house by a Congressional Member.
There are hurdles to passing EB-5 reauthorization and/or reform. Any kind of immigration legislation is inherently politically charged given varying factions on Capitol Hill and their relative constituencies. Further, despite how incredibly important the Program is to your families and to our Firm, EB-5 is a relatively small visa classification with regards to demand and annual allocations, at least compared to EB-1, EB-2, and EB-3, as well as the family-based and diversity categories. To these ends, the Program’s allies have historically sought to incorporate EB-5 reforms into “must-pass” legislation that covers other topics, such as Continuing Resolutions (“CRs”) and omnibus spending bills which fund the entire federal government. One rationale is that Congressional Members are less likely to object to such legislation if, by doing so, the entire federal government’s funding were to fail.
The Program’s allies have had a few opportunities to incorporate EB-5 reauthorization into must-pass legislation, most notably on September 30th and with the CR contemplated by Congress last Friday, December 3rd. For various reasons – of which, some explanations may be speculative – these efforts have not yet been successful. The CR that passed last Friday will extend government funding until February 18, 2022. Accordingly, the Program’s allies have another opportunity to use this, and perhaps other deadlines for must-pass legislation (such as the DHS Appropriations) to enact Program reforms and effectuate reauthorization. However, as of today, December 7, 2021, it remains too early for practically any member of the public to accurately predict how these efforts will be received and whether they will be successful.
There are a few things we know for certain. Most importantly, USCIS updated its website on October 4, 2021 to clarify that the agency will not take any adverse action based on a pending regional center based I-526 petition or I-485 application through December 31, 2021. This policy statement does not mean that USCIS will take adverse actions on such filings in January. Indeed, we have no reliable evidence as of today suggesting whether USCIS will continue to hold cases in abeyance as of a date certain, or indefinitely, into the future. Upon learning of new policy developments, we will provide updates accordingly.
That said, we do not believe, at this time, there will be mass denials or revocations after the holiday season, and several of our peer firms hold this same belief. Further, USCIS continues to process Forms I-131, I-765, and I-829 for Program investors and their families. We can confirm same because several of you receiving this communication have received approvals of these forms during the lapse, as recently as yesterday.
Several of you have approved Forms I-526 and have cases pending with the U.S. Department of State as part of your efforts to obtain a visa interview. The DOS has instructed its document clearing house, the National Visa Center, to cease review of Immigrant Visa Applications (Forms DS-260) and scheduling of Program-dependent interviews abroad, even if you have paid immigrant visa fees. Our Firm is involved with this issue in pending litigation although ultimate resolution of this issue remains unclear at this time.
We share your family’s frustration and disappointment regarding the ongoing lapse of the Program and are optimistically hopeful that legislative relief will soon be enacted to end this dark chapter of EB-5’s history. While the above message reflects our understanding of the current status of reauthorization and attendant issues, please contact us with any questions regarding your and your family’s specific circumstances.
We thank you for your continued trust in our Firm and hope for brighter days ahead.