After Years-Long Decline, EB-5’s Survival Beyond Summer Deadline Is Dubious
Without action by Congress, the long-standing, sometimes tumultuous EB-5 visa program will sunset at the end of June, more than 30 years after its creation.
The Biden campaign didn't specifically mention the program among its immigration policy stances, and since taking office, President Joe Biden hasn't issued a position on EB-5 reform or renewal. A bill introduced in Congress more than a year ago to extend the program and make various changes didn't make its way into law during the Trump administration and is still pending, despite bipartisan support.
The lobbying effort to renew EB-5 is broad, including commercial real estate developers, the lodging industry, national and local chambers of commerce, economic development organizations and mayors from 19 states, Forbes reports.
The terms of the program specify that for certain levels of investment in the U.S. that create jobs, investors and their families are entitled to permanent residency. Frequently, wealthy overseas nationals have been less interested in the investments than in obtaining green cards, especially for their college-aged children.
During the Trump administration, investor interest in the EB-5 program dropped off considerably. In 2016, according to U.S. Citizenship and Immigration Services data, the United States received 14,147 applications for I-526 visas, which is the designation for visas under the program.
By fiscal year 2020, the number was 4,378, but the decrease didn't seem to have anything to do with the coronavirus pandemic, since the number of applications in 2019 was 4,194 and in 2018 was 6,424.
Regulatory revisions went into effect in November 2019 that increased the amount necessary for an EB-5 investment to $900K from $500K in high-unemployment parts of the country, the Center for Immigration Studies reports. Cases of fraud in the program have also come to light in recent years.
A persistent backlog of applications for the program, especially in applications from China, the result of an approval process that often stretches on for years, has further chilled the program. Although the 2020 total of pending applications, 15,063, is nearly 10,000 fewer than the 2017 total of 24,992, it remains higher than as recently as 2013, when the total was 7,131.
Still, investor interest could turn around, especially if Congress takes steps to renew the program.
"We had half a dozen people who were just waiting" to see the election results before seeking an EB-5 visa, Mona Shah, head of the law firm and visa specialist Mona Shah & Associates Global, told Axios.
"People are willing to come in and invest in the United States again," she said.
The 2019 bill, EB-5 Reform and Integrity Act, is still under consideration by the Senate Judiciary Committee. U.S. Sens. Chuck Grassley, a Republican from Iowa, and Patrick Leahy, a Democrat from Vermont, the bill's original sponsors, are expected to introduce a sizable amendment to it, Homeland Preparedness reports.
Besides reauthorizing the program for five years, the amendment would include integrity provisions, such as protections for good-faith investors and for lawful EB-5 Immigrant Investor Regional Centers.