While The Regional Center Program may Expire On June 30, 2021 The Future of EB-5 Still Looks Bright

With the EB-5 Regional Center Program set to expire on June 30, investors will undoubtedly be anxious about the future of the program. Here’s our quick overview of what investors can expect in the future.

Reauthorization

Unfortunately, it’s unlikely that the regional center program will be reauthorized before June 30, 2021. While Senators Grassley and Leahy sought a unanimous consent vote on their EB-5 reform act, which would have reauthorized the EB-5 Regional Center Program through 2023, that effort was blocked by Senator Lindsey Graham. With the Senate currently out of session, the most likely outcome is that the EB-5 Regional Center Program will expire on June 30, 2021. 

However, investors and the EB-5 industry should not despair. While the program may expire on June 30, 2021, that does not mean it will be ended permanently. The EB-5 Regional Center Program is a valuable asset for the American economy and many senator’s constituents do not want it gone. 

The most likely path for reauthorization is for a bill to be passed later this year, after Senators and interests groups have had more time to negotiate what provisions would be included in such a bill. Although this would be less than ideal for investors it would help secure long term approval for the EB-5 Regional Center Program, and prevent another scramble to renew it in the future.

What Happens If the Program Expires?

While expiration of the program would be a setback for investors waiting to receive an EB-5 visa, it should only be a temporary one. To make an educated prediction of how the Department of Homeland Security (DHS) would handle expiration of the EB-5 Regional Center Program we only need to look back to December of 2018. On December 21, 2018 the EB-5 Regional Center Program expired after congress failed to pass a budget and the Federal Government was temporarily shut down. At the time DHS put out the following statement

 The EB-5 Immigrant Investor Regional Center Program expired at the end of the day on Dec. 21, 2018, due to a lapse in congressional authorization to continue the program. All regional center applications and individual petitions are affected. . . We will continue to receive regional center-affiliated Forms I-526, Immigrant Petition by Alien Entrepreneur, and Forms I-485, Application to Register Permanent Residence or Adjust Status, after the close of business on Dec. 22, 2018. As of Dec. 22, 2018, we will put unadjudicated regional center-affiliated Forms I-526 and I-485 (whether filed before or after the expiration date) on hold for an undetermined length of time.

All Forms I-829, Petition by Entrepreneur to Remove Conditions on Permanent Resident Status, filed before or after the expiration date, will not be affected by the expiration of the program.

USCIS will provide further guidance to the public if legislation is enacted to reauthorize, extend, or amend the regional center program.”

So while the EB-5 regional center program expired, USCIS continued to accept new I-526 applications and merely put pending USCIS Form I-526 applications, “on hold for an undetermined length of time.” 

If the EB-5 Regional Center Program expires, all indications point to DHS handling pending petitions in a similar manner to 2018. Pending petitions will likely be put on hold until the program is reauthorized, and USCIS would pick up where it left off once the program is reauthorized.

Can Investors Still Take Advantage of the $500,000 Investment Amount After the Program Expires?

Recently, a Northern District of California Judge struck down the 2019 EB-5 Modernization Regulations, resulting in a return to the lower $500,000 EB-5 investment amount (at least for investments in Targeted Employment Areas).  That raises an interesting question as to whether an investor can take advantage of the $500,000 investment amount if they submit an application after the EB-5 Regional Center Program expires on June 30, 2021, but before it renews in the future with a higher investment amount.

Obviously Congress may decide that keeping the lower $500,000 investment amount makes sense in order to reinvigorate the EB-5 visa program, which has lost some of its popularity as a result of the drastically increased investment amounts implemented in 2019.  EB-5 investment has led to billions of dollars in foreign direct investment into the United States, at no cost to the American taxpayer and keeping the lower investment amount may be the shot in the arm the U.S. economy needs right now.  

However, if the EB-5 Regional Center Program renews at a higher investment amount, and an investor has submitted an application prior to the renewal, they may have a compelling argument that they should benefit from the lower $500,000 investment amount.  It’s always advisable to consult with an experienced immigration attorney for important questions regarding EB-5.

Interestingly, some EB-5 regional centers have begun structuring their investment offering to accommodate a $900,000 investment, with an upfront investment of only $500,000, which investment can be modified in the future to reflect the future structure of the EB-5 Regional Center Program.   

Even though the EB-5 Regional Center Program is expiring, the opportunity to lock in the $500,000 investment amount is a compelling reason to get your application submitted as soon as possible. 

Interested EB-5 investors can fill out the contact form below to learn if they can qualify for the EB-5 Program.

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