Thursday, March 18, 2021 – Today, honorable Senators Chuck Grassley (R-Iowa), Ranking Member of the Senate Judiciary Committee, and Patrick Leahy (D-Vt.), a senior member and former Chairman of the Judiciary Committee, introduced the EB-5 Reform and Integrity Act of 2021. The bipartisan bill supports the long-term reauthorization and transformation of the EB-5 Regional Center Program.
The bill will reauthorize the program through 2026 and provide additional transparency and integrity measures to improve accountability of applicants, Regional Centers, and economic development projects. This bill will not be applied retroactively to investors who already filed or have approved petitions, whose eligibility will be determined under existing law.
The big winner in this legislation is EB-5 investors. Here is why.
Key Benefits for EB-5 Investors:
1) 5-year reauthorization The largest benefit of the bill is that it gives investors the stability of a long-term authorization. This ensures EB-5 visas and green cards are available and authorized for issuance. Over the past 29 years, the program has been extended for various intervals of time, previously multi-year and most recently, for shorter intervals. Investors deserve long-term authorization instead of waiting frequently for short extensions.
2) Adjustments of Status If a visa is immediately available (your priority date is current on the visa bulletin) under the new law, petitioners could be permitted to concurrently file Adjustment of Status (AOS) applications with their I-526 petition. This saves time and brings EB-5 benefits in-line with those afforded to other employment-based immigrants.
3) Regional Center disclosures This requires regional centers to provide more information to investors before their subscription. While most Regional centers already have clear disclosures and controls in place, these new rules make sure that everyone is doing the right thing.
4) Bad actors Department of Homeland Security will run background checks on regional centers and certain project principals to disqualify bad actors from participating in the program.
5) Audits and site visits This bill requires the Department of Homeland Security to audit Regional Centers every 5 years and perform site visits to EB-5 projects. It also requires New Commercial Enterprises to provide annual statements accounting for investor capital and certifying compliance with program requirements. This gives investors a second set of eyes, as the government will verify Regional Center and Project compliance.
6) Good faith protections for innocent investors:
- Age-out protection for children
- Priority date retention
- Use of recovered funds for another investment
Under the existing law, investors dealing with non-compliance had limited options and remedies to get back into program compliance. This provision adds protections and allows defrauded investors the opportunity to continue participating in the EB-5 program, if they were not involved with the fraud, giving them clarity and a second chance with a new Regional Center fund manager.
7) Decrease petition processing times Over a decade ago our investors were processed in just 3 months, today that time is expressed in years. This bill acknowledges these massive delays and will require fees to be adjusted to the rate necessary to achieve quicker processing.
8) More visas? While this bill does not include more visas, it puts the EB-5 program in a stronger position to seek more visas in upcoming discussions. The Biden Administration has prioritized modernizing our immigration system, clearing backlogs for employment-based categories, and recapturing visas. With strong integrity rules, congress should have no objection to expanding and making the EB-5 program more accessible.
"I appreciate IIUSA’s support of this legislation. I have been working to reform the EB-5 Regional Center Program for years, and I hope, with IIUSA’s support, that we are finally able to get this long-term reauthorization and reform package across the finish line,” - Senator Grassley
How can you help this bill become a law? Join the Coalition to Save and Create Jobs (CSCJ) and ask your Regional Center to join Invest in the USA (IIUSA), the only non-profit trade association for the EB-5 Regional Center Program, in fighting for a bright future for EB-5 and our EB-5 investors!
About Invest in the USA (IIUSA)
Founded in 2005, Invest In the USA (IIUSA) is the national membership-based 501(c)(6) not-for-profit industry trade association for the EB-5 Regional Center Program. Bob Kraft, CEO of FirstPathway Partners is the President of IIUSA. Through dedicated advocacy work, education, industry development, and research, IIUSA advocates for the EB-5 Regional Center Program.
About Coalition to Save and Create Jobs (CSCJ)
CSCJ (Coalition to Save and Create Jobs) was established to promote economic recovery, development, and growth by assuring the good-government and long-term reauthorization of the EB-5 Regional Center Program through the bipartisan EB-5 Reform and Integrity Act, championed by U.S. Senators Chuck Grassley (R-IA) and Patrick Leahy (D-VT). CSCJ consists of trade associations, chambers of commerce, municipalities and mayors’ offices, community banks, economic development organizations, health care facilities, and more.