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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 1
Submitted by:
Joseph P. Whalen
238 Ontario Street, No. 6
Buffalo, NY 14207
(716) 604-4322 (cell)
(716) 768-6506 (land-line)
IMMIGRANT INVESTOR PROGRAM OFFICE (IPO)
U.S. CITIZENSHIP AND IMMIGRATION SERVICES (USCIS)
DEPARTMENT OF HOMELAND SECURITY (DHS)
20 Massachusetts Ave., NW, MS 2235
Washington, D.C. 20529-2090
POSITION PAPER
IMMIGRANT INVESTOR VISA &
EB-5 REGIONAL CENTER
PROGRAM-SUGGESTED
REFORMS
I. Introduction
USCIS appears to be at a crossroads with the EB-5 Immigrant Investor Visa
and Regional Center Program. The Secretary of Homeland Security [Secretary]1 and the
American Immigration Lawyers Association [AILA]2 have each written to Senate leadership
and certain Senators have introduced EB-5 legislation.3 This paper will discuss the major
aspects of each and offer another perspective. I begin with the framework of the EB-5
Program per current law and then address each of the others’ points of view in turn before
pontificating from my own point of view. Especially due to my intimate dealings with EB-5
from both inside and outside of USCIS, I have a unique perspective and interest in seeing the
EB-5 Regional Center Program succeed.
1 https://plus.google.com/116040339968044139678/posts/A8cn7D7p4C5 or
https://ebfive.files.wordpress.com/2015/05/april-27-2015-letter-from-dhs-to-grassley-and-leahy-01987583.pdf 2 AILA Doc. No. 15060436. (Posted 6/4/15) at: http://www.aila.org/advo-media/aila-correspondence/aila-letter-
senator-leahy-eb-5-job-
eation?utm_source=Recent%20Postings%20Alert&utm_medium=Email&utm_campaign=RP%20Weekly 3 https://iiusa.org/blog/wp-content/uploads/2015/06/American-Job-Creation-and-Investment-Promotion-Reform-Act-
of-2015.pdf
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 2
After I began writing thus Position Paper, USCIS sent an unexpected e-mail
on June 16, 2015, that caught me, and probably the vast majority of EB-5 Stakeholders, by
surprise. It stated as follows:
USCIS Discontinues Electronic Form I-539, Form I-526, and Regional Center Document Library
On June 15, 2015, USCIS stopped accepting electronically filed Forms I-539, Application to
Extend/Change Nonimmigrant Status, and Forms I-526, Immigrant Petition by Alien Entrepreneur.
USCIS also discontinued the Regional Center Document Library.
This change will not adversely affect customers who have pending or draft cases that were created before June 15. We will adjudicate those cases to completion and allow the standard 30 days for customers to complete and submit their draft cases.
Recently, USCIS updated the Form I-539 and Form G-28, Notice of Entry of Appearance as Attorney or Accredited Representative. To ensure that the paper and electronic versions of these forms are consistent with each other, we must temporarily remove the current electronic versions until we develop these updated forms in our new USCIS online filing system, which launched in March 2015.
Filing a Form I-539 or Form I-526
Customers who need to file a Form I-539 or Form I-526 must now file the paper version of the form. If you already started an electronic Form I-539 or Form I-526, you will have 30 days from the day you began your application/petition to complete and submit it online. If you are unable to complete your electronic form within this 30-day time period, you will need to file a new paper application or petition.
For instructions on how to file a paper Form I-539, please visit our Form I-539 page.
For instructions on how to file a paper Form I-526, please visit our Form I-526 page.
If You Filed Electronically Before June 15, 2015
If you filed a Form I-539 or Form I-526 electronically, you will still be able to access your account to check your case status, change your address, and respond to requests for evidence while USCIS processes your case. If you filed a Form I-526 electronically, you will still be able to review and attest existing deal packages created by the Document Library Manager. However, Document Library Managers will not be able to create new document libraries or deal packages.
For More Information
If you have any questions about filing a Form I-539 or Form I-526 or accessing a Regional Center
Document Library, please contact us through our online help form or call customer service at 1-800-
375-5283 (1-800-767-1833 (TDD)). If you have questions about filing Form I-526 or accessing a
Regional Center Document Library, you can also email us
at [email protected]. …….
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 3
Almost immediately after that message came along, I received questions about
what this means. To be perfectly honest, I do not know, but I am willing to speculate and toss
around some ideas. Will you join me in that endeavor? Please. OK. Maybe USCIS is working
to make the system function better so they will be poised to accept I-924s as Dummy I-526s?
That eventuality is a feature of the proposed legislation and also contemplated via APA notice
and comment rulemaking. A mandatory examination of each and every proposed RC pooled
investment before any I-526 will be accepted for filing is likely to become a reality within the
next year or two. If the EB-5 Stakeholder Community wants a faster process then they must
be willing to accept some changes in order to make it happen. The EB-5 Stakeholder
Community must be at the top of the learning curve or they will be caught in the under tow.
Like it or not, big changes are looming—it will soon be time to sink or swim! I also urge
USCIS to work with Congress to help shape the EB-5 Regional Center Program into a safe,
efficient, transparent, well monitored, realistic, and user-friendly Program. I sincerely hope
that ELIS can be salvaged and made workable for EB-5 Regional Center Libraries and forms.
II. Obligatory Recitation of EB-5 Visa and Regional Center Program Basics
The Employment-Based, Fifth Preference, immigrant investor, or more accurately,
“employment creation”, visa classification is defined in the INA4 at § 203 (b) (5) [8 U.S.C.
§ 1153 (b) (5)], and is better known as EB-5. The basic underlying visa classification is a
permanent fixture in the statute and in no danger of expiring. The Regional Center aspect of
the Immigrant Investor Program is not a part of the permanent immigration statute. It is
instead a temporary enhancement to the EB-5 Visa Program which was proposed and passed
in 1992, via Pub. L. 102–395, title VI, §610, Oct. 6, 1992, 106 Stat. 1874, as amended; a.k.a.,
the Judiciary Appropriations Act of 1993, and is codified as 8 U.S.C. § 1153 Note:
Immigration Program5. The original “pilot” program having been buried in an appropriations
bill has since been poised to sunset on September 30th of various years because that is the end
of the federal fiscal year and thus various budgeted appropriations can run out on that date. It
is that public law that has been repeatedly amended6 by changing the end date for the program.
4 Immigration and Nationality Act (INA) is codified at 8 U.S.C., Chapter 12. 5 In the last program extension legislation, the pertinent section heading reads: “EB-5 Regional Center Program” but
the United States Code still reads: “Immigration Program” having simply dropped the word “Pilot” from that
amendment’s heading. 6 Pub. L. 102–395, title VI, §610, Oct. 6, 1992, 106 Stat. 1874 , as amended by Pub. L. 105–119, title I, §116(a), Nov.
26, 1997, 111 Stat. 2467 ; Pub. L. 106–396, §402, Oct. 30, 2000, 114 Stat. 1647 ; Pub. L. 107–273, div. C, title I,
§11037(a), Nov. 2, 2002, 116 Stat. 1847 ; Pub. L. 108–156, §4, Dec. 3, 2003, 117 Stat. 1945 ; Pub. L. 111–83, title V,
§548, Oct. 28, 2009, 123 Stat. 2177 ; and with Pub. L. 112–176, §1, Sept. 28, 2012, 126 Stat. 1325, being the most
recent as of this writing.
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 4
Later in the process, when the investors have to demonstrate that they have
achieved the objectives of appropriately spending the funds and creating the jobs, they are
complying with INA § 216A [8 U.S.C. § 1186b]. The present implementing regulations are
found at 8 C.F.R. § 204.6 [for the initial immigrant visa petitions and regional center
applications], and § 216.6 [for removal of conditions]7. The various USCIS forms used for
the program have detailed instructions that further clarify and enhance the requirements.
Those form instructions are given the force of regulation, where they do not contradict them,
or the statutes. See 8 C.F.R. § 103.2(a)(1).
III. Secretary Jeh Johnson’s Letter of April 27, 2015
Secretary Johnson has proposed a number of changes to the EB-5 Regional
Center Program. While he has asked Congress to pass legislation to give effect to certain
changes, he is willing to have USCIS take the slower option through APA Notice-and-
Comment Rulemaking where needed. If I am reading correctly between the lines; USCIS may
issue some Interim; or Direct Final Rules where that is possible. Direct Final Rules are
appropriate for internal changes and probably where public safety or national security is at
stake. The Secretary has specifically asked for, or has alerted Congress to, a variety of
program enhancements already made or in-process. I will not repeat them in full but will
instead just list the headings from his letter. I will expand on some of his points later in this
position paper. Those areas were the Secretary asked for program enhancements, or stated
that they have been made, or are in-process, include in full:
Authorize USCIS to Quickly Act on Criminal and Security Concerns;8
Protect Investors by Regulating 9 Regional Center Principals and Associated
Commercial Enterprises;10
Enhance Reporting and Auditing;
Provide Sanction Authority;
Improve Integrity of Targeted Employment Areas (TEAs);
Increase Minimum Investment Amounts;
Require Business Plan Filings in Advance of Investor Filings;
7 See also: http://www.slideshare.net/BigJoe5/original-ins-view-of-employment-creation-immigrants and
http://www.slideshare.net/BigJoe5/original-eb5-fr-notice-1991 8 The items in red are best achieved through legislation because implementing such changes through regulation would
likely be found ultra vires. 9 The items in green could be done through regulation but legislation would be faster.
10 Background checks are performed, and other safeguards are already in-place per SEC regulations as required.
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 5
Contacts with EB-5 Petitioners, Applicants, and Other Stakeholders;
Contacts with Members of the U.S. Congress and Congressional Staff; and
Leadership Intervention in Specific EB-5 Cases.
IV. AILA’s Letter of June 3, 2015
AILA primarily focuses on its support of the inclusion of indirect jobs
forecasted by input-output economic models. I support that objective as well and offer further
commentary on the topic.
V. S. 1501 Introduced June 3, 201511
Senate Judiciary Committee Chairman Charles Grassley (R-Iowa) and Ranking
Member Patrick Leahy (D-Vt.) introduced S. 1501 (American Job Creation and Investment
Promotion Reform Act of 2015) on June 3, 2015. The bill seeks to reauthorize and refine the
EB-5 Regional Center program, and to alter some aspects of the underlying EB-5 visa
classification and direct investment option. I like and agree with some, and dislike other, ideas
outlined in the legislation. First and foremost in my mind is that the Regional Center Program
should not be “reauthorized”, it needs to be made permanent. S. 1501 is a good start in
that it actually incorporates the Regional Center Program into the INA but with a sunset date.
Section 2 of the bill is reproduced below. It contains some questionable provisions. I am
adding highlighting and other obvious emphasis to the text of the bill and will add comments
below.
11 See also: https://www.congress.gov/114/bills/s1501/BILLS-114s1501is.pdf and http://thomas.loc.gov/cgi-
bin/thomas
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 6
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
(a) Repeal- Section 610 of the Departments of Commerce, Justice, and State, the Judiciary,
and Related Agencies Appropriations Act, 1993 (8 U.S.C. 1153 note) is repealed.
(b) Authorization- Section 203(b)(5) of the Immigration and Nationality Act (8 U.S.C.
1153(b)(5)) is amended by adding at the end the following:
`(E) REGIONAL CENTER PROGRAM-
`(i) IN GENERAL- Visas under this paragraph shall be made
available through September 30, 2020, to qualified immigrants (and
the eligible spouse and children of such immigrants) participating in
a program implementing this paragraph that involves a regional
center in the United States, which has been designated by the
Secretary of Homeland Security on the basis of a proposal for the
promotion of economic growth, including prospective job creation
and increased domestic capital investment.
`(ii) PRIORITY- In processing petitions under section 204(a)(1)(H)
for classification under this paragraph, the Secretary of Homeland
Security may give priority to petitions filed by aliens seeking
admission under this subparagraph. Notwithstanding subsection (e),
immigrant visas made available under this paragraph may be issued
to such aliens in an order that takes into account any priority
accorded under this clause.
`(iii) ESTABLISHMENT OF A REGIONAL CENTER- A regional
center shall operate within a defined geographic area, which shall be
described in the proposal and be consistent with the purpose of
concentrating pooled investment within the defined and limited
geographic area. The proposal to establish a regional center shall
demonstrate that the pooled investment will have a significant
economic impact on such geographic area, and shall include--
`(I) reasonable predictions, supported by economically and
statistically valid forecasting tools, concerning the amount
of investment that will be pooled, the kinds of commercial
enterprises that will receive such investments, verifiable
details of the jobs that will be created directly or indirectly
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 7
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
as a result of such investments, and other positive economic
effects such investments will have; and
`(II) a description of the policies and procedures in place
reasonably designed to monitor associated commercial
enterprises to ensure compliance with all laws, regulations,
and Executive orders of the United States.
`(iv) INDIRECT JOB CREATION- The Secretary of Homeland
Security shall permit aliens seeking admission under this paragraph
to satisfy up to 90 percent of the requirements under subparagraph
(A)(ii) with jobs that are estimated to be created indirectly through
investment under this paragraph in accordance with this
subparagraph.
`(v) COMPLIANCE-
`(I) IN GENERAL- In determining compliance with
subparagraph (A)(ii), the Secretary of Homeland Security
shall--
`(aa) permit aliens seeking admission under this paragraph to rely on economically and statistically
valid methodologies for determining the number of jobs created by the program, including, consistent
with this subparagraph, jobs estimated to have been created indirectly through revenues generated
from increased exports, improved regional productivity, job creation, and increased domestic capital
investment resulting from the program; and
`(bb) verify that the jobs described in item (aa) meet the requirements under this subparagraph by
using a methodology that has been accepted by the Bureau of Economic Analysis of the Department
of Commerce to be economically and statistically valid for such purposes.
`(II) PROJECTS INVOLVING CAPITAL
CONTRIBUTION FROM NON-ALIEN
ENTREPRENEURS-
`(aa) CREDIT FOR JOB CREATION- Alien entrepreneurs may accrue credit for job creation based
on capital investment provided by non-alien entrepreneurs only for the percentage of total jobs
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 8
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
created that is equal to the percentage of total capital investment provided by such non-alien
entrepreneurs in the commercial enterprise.
`(bb) LIMITATION- The percentage of jobs created for which alien entrepreneurs may accrue credit
under item (aa) based on such non-alien entrepreneur capital contribution may not exceed 30 percent
of all jobs created even if such contribution exceeds 30 percent.
`(III) INELIGIBLE JOBS- In determining compliance with
the job creation requirements under subparagraph (A)(ii),
the Secretary may not include jobs estimated to be created
under a tenant-occupancy methodology.
`(vi) AMENDMENTS- The Secretary of Homeland Security shall--
`(I) require approved regional centers to give advance notice
to the Secretary of significant proposed changes to their
organizational structure, ownership, or administration,
including the sale or rental of such centers;
`(II) approve or disapprove the changes referred to in
subclause (I) before any such proposed changes take effect;
and
`(III) approve the changes referred to in subclause (I) only
after--
`(aa) notice of any such proposed changes are made publicly available through a publicly accessible
website of U.S. Citizenship and Immigration Services for a period of not fewer than 30 days; and
`(bb) the Secretary determines that the regional center would remain compliant with this
subparagraph and with subparagraph (H).
`(F) BUSINESS PLANS FOR REGIONAL CENTER INVESTMENTS-
`(i) APPLICATION FOR APPROVAL OF INVESTMENT IN
COMMERCIAL ENTERPRISE- A commercial enterprise
associated with a regional center shall file an application with, and
obtain approval from, the Secretary of Homeland Security for each
particular investment offering through the commercial enterprise to
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 9
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
aliens seeking classification under this paragraph, which shall
include--
`(I) a comprehensive business plan for a specific capital
investment project;
`(II) a credible economic analysis regarding estimated job
creation that is based upon economically and statistically
valid methodologies;
`(III) documents filed with the Securities and Exchange
Commission under the Securities Act of 1933 (15 U.S.C.
77a et seq.);
`(IV) investment and offering documents, including
subscription, investment, partnership, and operating
agreements, private placement memoranda, term sheets,
management biographies, the description of the business
plan to be provided to potential alien entrepreneurs, and any
marketing materials used or prepared for use in connection
with the offering by the regional center or any associated
commercial enterprise, which shall contain references, as
appropriate, to any--
`(aa) investment risks associated with the new commercial enterprise and any other business
subsequently receiving investment capital from the new commercial enterprise;
`(bb) conflicts of interest that currently exist or may arise among the regional center, new commercial
enterprise, other business subsequently receiving investment capital from the new commercial
enterprise, or the principals of the aforementioned entities;
`(cc) the name and contact information of any person that has received or the commercial enterprise
knows will receive any fees or transaction-based compensation in connection with the investment,
and a description of the services performed or to be performed by such person which entitle them to
the fees or transaction-based compensation; and
`(dd) any pending litigation or bankruptcy or adverse judgments during the most recent 10-year
period affecting the regional center, new commercial enterprise, any other business subsequently
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 10
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
receiving investment capital from the new commercial enterprise, or any other enterprise in which
any principal of the aforementioned entities held majority ownership at the time;
`(V) a description of the policies and procedures reasonably
designed to ensure that the commercial enterprise, its agents,
employees, and attorneys, and any persons in active concert
or participation with the commercial enterprise, comply with
the securities laws of the United States in connection with
the offer, purchase, or sale of its securities;
`(VI) a certification that the commercial enterprise and its
agents, employees, and attorneys, and any persons in active
concert or participation with the commercial enterprise, are
in compliance with the securities laws of the United States
in connection with the offer, purchase, or sale of its
securities; and
`(VII) for a capital investment in a targeted employment
area, a credible economic analysis regarding estimated job
creation that is likely to occur--
`(aa) if the targeted employment area is located within a combined statistical area or a metropolitan
statistical area, in the combined statistical area or metropolitan statistical area; or
`(bb) if the targeted employment area is located outside of an area described in item (aa), in any
county that is included in the targeted employment area and counties adjacent to the targeted
employment area.
`(ii) EFFECT OF APPROVAL OF BUSINESS PLAN FOR
INVESTMENT IN REGIONAL CENTER COMMERCIAL
ENTERPRISE- The approval of an application under this
subparagraph shall be binding for purposes of the adjudication of
subsequent petitions seeking classification under this paragraph by
immigrants investing in the same commercial enterprise concerning
the same economic activity, and of petitions filed under section
216A, unless the Secretary of Homeland Security determines that
there is evidence of fraud, misrepresentation, criminal misuse, a
threat to public safety or national security, a material change that
affects the approved economic model, other evidence affecting
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 11
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
program eligibility that was not disclosed by the petitioner during
the approval process, or a material mistake of law or fact in the prior
adjudication.
`(iii) CONSIDERATION OF FRAUDULENT OR OTHER
CRIMINAL ACTIVITY IN ESTABLISHING ELIGIBILITY
CRITERIA-
`(I) IN GENERAL- The Secretary of Homeland Security
shall consider the potential for fraud, misrepresentation,
criminal misuse, and threats to public safety or national
security in establishing eligibility criteria under this
subparagraph.
`(II) GROUNDS FOR DENIAL OR REVOCATION- The
Secretary shall deny or revoke the approval of any business
plan application under this subparagraph with any particular
investment or business arrangement that, in the Secretary's
unreviewable discretion--
`(aa) presents a threat to public safety or national security; or
`(bb) presents a significant risk of criminal misuse, fraud, or abuse, including arrangements that
involve self-dealing or any other inherent conflict of interest between potential alien entrepreneurs
and the principals of a regional center or a regional center associated commercial enterprise.
`(iv) SITE VISITS- The Secretary shall perform at least 1 site visit
to each regional center associated commercial enterprise in
accordance with section 216A(c)(1)(C).
`(v) PREMIUM PROCESSING OPTION- The Secretary shall
establish a process for premium processing of business plan
applications under this subparagraph related to investment in a
regional center commercial enterprise, including making available
the expeditious execution of a site visit described in clause (iv),
which may include an opportunity for the applicant to address and
cure any deficiencies identified by the Secretary in the applicant's
business plan, investment documents, or statement regarding job
creation prior to a final determination. The Secretary shall impose a
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 12
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
fee for the use of the process described in this clause sufficient to
recover the costs of its administration.
`(vi) APPROVAL OF BUSINESS PLAN IN A TARGETED
EMPLOYMENT AREA- For a capital investment in a designated
targeted employment area, at least 50 percent of the estimated job
creation intended to form the basis of the job creation requirement
under subparagraph (A)(ii) shall be expected to occur within an area
specified in subparagraph (F)(i)(VII). If the estimated job creation in
such area is below 50 percent, the total number of jobs created by
the capital investment for which alien entrepreneurs may receive
credit shall be limited to the number at which 50 percent of the job
creation requirement occurs within an area described in clause
(i)(VII).
`(G) REGIONAL CENTER ANNUAL STATEMENTS-
`(i) IN GENERAL- Each regional center designated under
subparagraph (E) shall annually submit, to the Director of U.S.
Citizenship and Immigration Services (referred to in this
subparagraph as the `Director'), in a manner prescribed by the
Secretary of Homeland Security, a statement, including--
`(I) a certification by the regional center that it remains in
compliance with clauses (i) and (ii) of subparagraph (H);
`(II) a certification by the regional center described in
subparagraph (I)(ii)(II);
`(III) a certification by the regional center that it is in
compliance with subparagraph (K)(iii);
`(IV) a description of any pending litigation or bankruptcy
proceedings, or litigation or bankruptcy proceedings
resolved during the preceding fiscal year, involving the
regional center or an associated commercial enterprise;
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 13
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
`(V) an accounting of all foreign investor money invested in
the regional center and its associated commercial
enterprises; and
`(VI) for each new commercial enterprise associated with
the regional center--
`(aa) an accounting of the aggregate capital invested in the new commercial enterprise by alien
entrepreneurs under this paragraph for each capital investment project being undertaken by the new
commercial enterprise;
`(bb) a description of how such capital is being used to execute each capital investment project in the
approved business plan or plans;
`(cc) evidence that 100 percent of such capital has been irrevocably committed to each capital
investment project;
`(dd) detailed evidence of the progress made toward the completion of each capital investment
project;
`(ee) an accounting of the aggregate direct jobs created or preserved;
`(ff) a description of all funds, including administrative, loan monitoring, or loan management fees,
in addition to investor capital collected from alien entrepreneurs by any party in relation to the
investment or participation in the regional center program described in subparagraph (E), the entities
that received such funds, and the purpose for which such funds were collected;
`(gg) any documentation referred to in subparagraph (F)(i)(IV) if there has been a material change
during the preceding fiscal year; and
`(hh) a certification by the regional center and associated commercial enterprise that such statements
are accurate.
`(ii) AMENDMENT OF ANNUAL STATEMENTS- The Director--
`(I) shall require the regional center to amend or supplement
an annual statement required under clause (i) if the Director
determines that such statement is deficient; and
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 14
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
`(II) may require the regional center to amend or supplement
such annual statement if the Director determines that such
an amendment or supplement is appropriate.
`(iii) SANCTIONS-
`(I) EFFECT OF VIOLATION- If the Director determines
that a regional center or other individual affiliated with a
regional center, including an individual affiliated with an
associated commercial enterprise, and any legal
representative of such entities, has violated any certification
under clause (i) or that the regional center is conducting
itself in a manner inconsistent with its designation, including
any willful and material deviation by commercial enterprises
associated with the regional center from any approved
business plan for such commercial enterprises, the Director
shall sanction the violating entity or individual under
subclause (II).
`(II) AUTHORIZED SANCTIONS- The Director shall
establish a graduated set of sanctions based on the severity
of the violations referred to in subclause (I), as determined
by the Director, including--
`(aa) civil money penalties equal to not more than 10 percent of the total capital invested by alien
entrepreneurs in the regional center's associated commercial enterprises, the payment of which shall
not in any circumstance utilize any of such alien entrepreneurs' capital investment;
`(bb) temporary suspension from participation in the program described in subparagraph (E), which
may be lifted by the Director if the individual or entity cures the alleged violation after being
provided such an opportunity by the Director;
`(cc) permanent bar from program participation for 1 or more individuals associated with the regional
center or an associated commercial enterprise; and
`(dd) termination of regional center status.
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 15
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
`(H) BONA FIDES OF PERSONS ASSOCIATED WITH REGIONAL
CENTERS OR REGIONAL CENTER ASSOCIATED COMMERCIAL
ENTERPRISES-
`(i) IN GENERAL- No person shall be permitted by any regional
center or regional center associated commercial enterprise to be
directly or indirectly involved with the regional center or
commercial enterprise as its principal, representative, administrator,
owner, officer, board member, manager, executive, general partner,
fiduciary, marketer, promoter, or other similar position of
substantive authority for the operations, management or promotion
of the regional center or commercial enterprise if--
`(I) the person has been found liable within the previous 10
years for any criminal or civil violation of any law relating
to fraud or deceit, or at any time if such violation involved a
civil liability in excess of $1,000,000, a criminal conviction
with a term of imprisonment of more than 1 year or a
criminal or civil violation of any law or agency regulation in
connection with the offer, purchase, or sale of a security;
`(II) the person is subject to a final order of a State securities
commission (or an agency or officer of a State who performs
similar functions), a State authority that supervises or
examines banks, savings associations, or credit unions, a
State insurance commission (or an agency of or officer of a
State who performs similar functions), an appropriate
Federal banking agency, the Commodity Futures Trading
Commission, or the National Credit Union Administration,
which is based on a violation of any law or regulation that--
`(aa) prohibits fraudulent, manipulative, or deceptive conduct; or
`(bb) bars the person from--
`(AA) association with an entity regulated by such commission, authority, agency, or officer;
`(BB) engaging in the business of securities, insurance, or banking; or
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 16
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
`(CC) engaging in savings association or credit union activities;
`(III) there is reasonable cause to believe that the person is
engaged in, has ever been engaged in, or seeks to engage in-
-
`(aa) any illicit trafficking in any controlled substance or in any listed chemical (as defined in section
102 of the Controlled Substances Act);
`(bb) any activity relating to espionage, sabotage, or theft of intellectual property;
`(cc) any activity related to money laundering (as described in section 1956 or 1957 of title 18,
United States Code);
`(dd) any terrorist activity (as defined in clauses (iii) and (iv) of section 212(a)(3)(B));
`(ee) any activity related to human trafficking or a human rights offense;
`(ff) any activity described in section 212(a)(3)(E); or
`(gg) the violation of any statute, regulation, or Executive order regarding foreign financial
transactions or foreign asset control; or
`(IV) the person--
`(aa) is, or during the preceding 10 years has been, included on the Department of Justice's List of
Currently Disciplined Practitioners; or
`(bb) during the preceding 10 years, has received a reprimand or otherwise been publicly disciplined
by a bar association of which the person is or was a member.
`(ii) STATUS OF REGIONAL CENTER PRINCIPALS-
`(I) LAWFUL STATUS REQUIRED- No person may be
directly or indirectly involved with a regional center as its
principal, administrator, owner, officer, board member,
manager, executive, general partner, fiduciary, or other
similar position of significant authority for the operations or
management of the regional center unless the person is a
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 17
S.1501
American Job Creation and Investment Promotion Reform Act of 2015 (Introduced in Senate)
SEC. 2. REAUTHORIZATION OF EB-5 REGIONAL CENTER PROGRAM.
national of the United States or an individual who has been
lawfully admitted for permanent residence.
`(II) FOREIGN GOVERNMENTS- No foreign government
entity may be directly or indirectly involved with the
ownership or administration of a regional center.
`(iii) INFORMATION REQUIRED- The Secretary shall require
such attestations and information, including the submission of
fingerprints or other biometrics to the Federal Bureau of
Investigation, and shall perform such criminal record checks and
other background checks with respect to a regional center or
regional center associated commercial enterprise, and persons
involved in a regional center or regional center associated
commercial enterprise as described in clauses (i) and (ii), to
determine whether such regional center or regional center associated
commercial enterprise is in compliance with clauses (i) and (ii).
VI. Adding Confusion Through Overly Complicated Complexity
Confusing and Contradictory Formulas for Indirect Job Counts!
`(iv) INDIRECT JOB CREATION-
The Secretary of Homeland Security
shall permit aliens seeking admission
under this paragraph to satisfy up to 90
percent of the requirements under
subparagraph (A)(ii) with jobs that are
estimated to be created indirectly
through investment under this paragraph
in accordance with this subparagraph.
`(aa) CREDIT FOR JOB CREATION-
Alien entrepreneurs may accrue credit for
job creation based on capital investment
provided by non-alien entrepreneurs only
for the percentage of total jobs created
that is equal to the percentage of total
capital investment provided by such non-
alien entrepreneurs in the commercial
enterprise.
The above provisions seem to be at odds with each another. While one provision
limits the use of indirect jobs to 90% for alien investors the other allows all of the non-EB-5 jobs
for use by alien investors equal to the percentage of non-EB-5 capital. Let me see if I understand
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 18
this. Suppose that a RC Project costs $10 million; 4 aliens invest $1 million each (40%) and non-
EB-5 funds then equal $6 million (60%). The fund (NCE) makes a loan to the developer
(middleman). The Project which was fully described in the comprehensive business plan is the
building of a small niche year-round resort and amusement park (JCE) that has a staff 30 new
full-time workers in the resort with 15 indirect jobs within the supply chain and another 5 induced
jobs through new direct and indirect employee spending. This RC-affiliated project has added 70
new jobs and many other intangible benefits to the regional economy as verified by an accepted
economic impact analysis.
If we apply EB-5 definitions to the jobs, we have only indirect jobs. There are a
total of 70 new jobs BUT each alien may only use 9 jobs towards their 10 job requirement, this
means that no loan model may ever be used because without an ownership equity the alien cannot
lay claim to any EB-5 direct job. That “90% provision” has to be dropped because it will turn
virtually all EB-5 investments into dead-end propositions. If there were an ownership interest
instead of a loan, maybe it might work, but that would require a watershed change to doing
business in the EB-5 world. That would be a serious mistake. As for the “fair-share” provision, if
we use the same scenario, let’s see how that stacks up. We have 70 jobs total. 60% of 70 is 42
jobs. What does that mean in practical terms? At the $1 million investment threshold, the alien
investors are squeaking by, with a miniscule buffer of 2 jobs generated by their domestic partners.
That is without the 90% limit, or that 30% limitation—it’s enough to make you go crazy!
Now let’s suppose that the aliens each wanted to invest only $500,000. That would
mean that the math would have to change drastically because even at the present ability to use
100% indirect jobs, there are only 70 total jobs for an absolute maximum of 7 EB-5 investors with
no buffer or margin for error. It’s painful just thinking about it! These changes would be bad for
Republican business owners and bad for Democratic laborers. I give up!
VII. Now For Some Things I Like!
The mere fact that more attention is being paid to indirect job creation and
“reasonable predictions” of them is welcome. Overall, enhancements to the Regional Center
application process (especially mandated maximum processing times—it works for Blanket L
Petitions); mandatory site visits; enhanced reporting and self-monitoring, including explanations
of them as part of the initial application; and sanction authority are generally welcome. Also,
while charging enough to recover costs has long been the way benefits adjudication and
administration has functioned, the Secretary’s proposed $20,000 annual fee is out of line with
reality. I also favor restrictions on who may apply for Regional Centers and mandating
background checks and proof of compliance with securities law.
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 19
VIII. USCIS Processing Time Information for the Immigrant Investor Program Office12
Posted: June 15, 2015
Instructions on Using the Chart
Below is a chart that shows the form number, form name and processing times for the following
forms that are processed by the Immigrant Investor Program Office (IPO). Find the particular
form number (in the left column) or form name (in the center column) in which you are
interested. In the right column you will find a timeframe in months representing the average
processing time for that form type. Please note some cases may take longer to process. USCIS
offers a variety of services after you file. For a Form I-526 you can check the status of your case
online or email [email protected] if your Form I-526, Form I-
829, or Form I-924 is beyond the stated processing timeframe.
Average Processing Times for Immigrant Investor Program Office as of: April 30, 2015
Form Title Classification or Basis for Filing: Processing
Timeframe:
I-526 Immigrant Petition By Alien
Entrepreneur
For use by an entrepreneur who wishes to
immigrate to the United States 13.4 Month(s)
I-829 Petition by Entrepreneur to
Remove Conditions
Removal of lawful permanent resident
conditions (immigrant investors) 13.1 Month(s)
I-924
Application For Regional Center
Under the Immigrant Investor
Pilot Program
I-924 - Application For Regional Center
Under the Immigrant Investor Pilot
Program
12.2 Month(s)
The above processing times are thoroughly outrageous and unacceptable!
12 Found June 16, 2015, at: https://egov.uscis.gov/cris/processingTimesDisplay.do
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 20
IX. Some Suggestions From Left Field—My EB-5 Wish List
If either S.1501 or the Secretary’s framework or some amalgamation of them come
to pass, I would like to see some specific improvements and this is likely my last chance to blab
in a grand and public manner for the foreseeable future. I plan to make the most of it. I am going
to list some ideas that some EB-5 Stakeholders will like and probably some that others will hate.
Acknowledge the simple fact that Regional Center Designation is actually
“licensure” and adopt procedures applicable to licenses contained in the
Administrative Procedures Act (APA). 5 U.S.C. § 500 et seq. and § 700 et
seq.
Quickly get ELIS or some other e-filing system back online with the I-924
being the primary EB-5 functionality. This will mean that both initial
applications and amendments should be accepted.
Implement Mandatory Investment Petition Advance Vetting Procedures,
also known as Dummy I-526 or Exemplar I-526 Petitions.
o Allow and encourage enhanced direct communication regarding
Regional Center Project Plans during initial adjudication process.
o Acknowledge that an I-924 is fully amenable to “Perfection After
Filing” because it has no “priority date” consideration but will
serve as a foundation for individual I-526 filings by alien investors.
o Clearly state that an approval at this stage is Provisional and will
merely serve as a basis for filing individual petitions and for
conditional resident status.
o Make clear that I-829 adjudications are completely separate
proceedings that may be either dependent on the earlier vetted
plans or subject to a completely new review if based on a new plan.
Change the filing fee structure.
o Initial RC Designations need to be tougher, longer, and more
expensive. Applicants must demonstrate sufficient knowledge,
skills, and abilities (KSAs) to run a Regional Center and everybody
must get background a check, with individual biometric fees added
to the cost.
o Still allow the current three deference levels but only in conjunction
with an initial designation I-924 application.
o Mandatory Project-Based I-924 Amendment Applications must be
fast-tracked and must be limited to the highest deference level.
o Mandatory Single Project Amendments will be filed in greater
numbers and limited to a single RC-affiliated Project, so they
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IMMIGRANT INVESTOR VISA & EB-5 REGIONAL CENTER PROGRAM-SUGGESTED REFORMS - 21
should cost less to adjudicate even when fast-tracked*. These will
be limited to the project alone. No time need be wasted re-
examining RC Operation Plans, principals, or anything related to
individual alien investors. [*Not as fast as premium processing.]
o RC Ownership/Leadership Change Amendments should be stand-
alone amendments with individual biometric fees.
Individual I-526 Visa Petitions must not be accepted until after a Project-
Specific I-924 has been Provisionally Approved.
As was allowed in ELIS until it was discontinued, allow I-526 petitioners
to file project-specific attestations instead of complete sets of redundant
piles of virtually useless paper.
RC-affiliated I-526 petitions should be accepted at a reduced filing fee
since the shared project documentation will not be re-examined.
Only allow non-RC I-526 petitioners to file I-907s for Premium
Processing but it has to be at least twice as long as for other benefit forms.
Dependent family members should not be counted against the cap OR
remove the cap completely.
Do not mandate any other agencies* to be involved but leave it open to
negotiations between them & USCIS. [*SEC, FBI, ICE, CIA, etc..].
Whether through statute or regulation, specific minimum requirements and
filing prerequisites need to be made clear for Regional Center Designation.
There are some KSAs to be gleaned from the form instructions. However,
when the opportunity arose to address this issue, AAO declined to do so.
USCIS, through IPO, therefore needs to publish the long awaited proposed
regulatory changes so that formal comments may be submitted.
Processing times MUST shrink to meet the realities of the business world.
At 100+ employees, IPO must speed things up in order to justify its existence, the honeymoon is over!
Dated this 26th day of June, 2015
X /s/ Joseph P. Whalen
That’s my two-cents, for now!
