It’s hardly a secret that the Biden administration is far friendlier toward immigration than the Trump administration was. While President Trump introduced various hurdles for newcomers to the United States, including an outright ban on most forms of immigration throughout 2020, President Biden has announced that comprehensive legislative reform to United States Citizenship and Immigration Services (USCIS) can be expected. Indeed, immigration reform was among Biden’s top talking points throughout his presidential campaign, and if his proposed plan is anything to go by, he will certainly make good on his promises. The full text of the bill has not yet been officially released, but the White House has published a fact sheet that provides a detailed outline of the changes to be proposed.
If the U.S. Citizenship Act of 2021 is passed, it will constitute one of the biggest legislative overhauls the U.S. immigration system has seen in decades. It would revolutionize the way the United States deals with immigration, with the White House citing “keeping families together, growing our economy, responsibly managing the border with smart investments, addressing the root causes of migration from Central America, and ensuring that the United States remains a refuge for those fleeing persecution” as the primary goals of the reform.
How Would the EB-5 Program Benefit from the Act?
The EB-5 Immigrant Investor Program is not explicitly named in the overview of the bill, and as a controversial residency-by-investment program, it is unlikely to garner significant focus from the president. Nonetheless, EB-5 investment participants stand to benefit greatly from the measures in the proposed bill favoring economic immigration. Here are five key measures that could dramatically improve the EB5 investment landscape.
Clearing Employment-based Visa Backlogs
Since 2014, the EB-5 program has been plagued with lengthy backlogs for EB-5 investment participants from particularly high-demand countries. China has led the pack in backlogs since the onset, but their southern neighbors in Vietnam joined the ranks a few years later. With thousands of EB5 investment participants with approved I-526 petitions awaiting visa availability per the monthly USCIS Visa Bulletin, backlogs dramatically delay an investor’s start to a new life in the United States while presenting the risks of necessary redeployment of EB-5 investment capital and dependent children aging out and becoming ineligible for a U.S. green card. Focusing on clearing the backlogs would change the lives of thousands of Chinese and Vietnamese EB-5 investors.
Recapturing Unused Visas
At the beginning of every fiscal year, USCIS designates a certain number of visas to each immigration program. If unclaimed visas remain at the end of the fiscal year, they are generally recycled into other programs more heavily favored by the U.S. government. Sometimes this can be good for the EB-5 program—for example, the unprecedented events of 2020 resulted in tens of thousands of unused family visas being rolled over to employment-based immigration in FY2021, with the EB-5 program receiving almost 10,000 more visas than usual.
Of course, most years won’t be like 2020, and recapturing unused visas will generally ensure that the EB-5 program doesn’t lose visas it was previously allocated. With USCIS having issued only a fraction of EB-5 visas five months into FY2021 despite the huge uptick in supply, the enactment of the proposed bill could save thousands of unused visas from rolling over into other programs.
Shortening Long Wait Times
As of February 2021, the typical wait time for I-526 petition approval—the first step on the EB5 investment journey toward U.S. permanent resident status—hovers around two to four years. For backlogged investors, this wait time is only elongated. USCIS’s inefficiency since FY2019 has resulted in ever-growing wait times for investors, markedly decreasing the attractiveness of the United States’ residency-by-investment program. Shortening wait times could boost the appeal of making an EB-5 investment, resulting in more investors embarking on the journey and funneling more capital into the U.S. economy.
Eliminating Country-based Visa Caps
U.S. immigration programs are subject to country-based visa caps, originally intended to spread immigration out across many countries. However, these caps are applied uniformly with no regard for the demand or population of a country, leaving China with the same number of permitted visas per fiscal year as Andorra. These caps are the reason behind the EB-5 backlogs, as the demand in large countries like China and Vietnam significantly outpaces the uniform country caps. Eliminating country limits for EB-5 visas could see the backlogs disappear rapidly, with thousands of Chinese and Vietnamese EB-5 investors finally receiving their long-awaited permanent resident status.
Exempting Spouses and Dependent Children from Employment-based Visa Quotas
Also contributing to the lengthy backlogs are EB-5 visas for spouses and dependent children cutting into the number of visas available for EB5 investment participants themselves. With roughly 10,000 EB-5 visas available per year, only around 3,000 go to investors. If spouses and dependent children are exempted from this pool, thousands more EB-5 investors will become eligible for visas, allowing USCIS to easily clear the long-standing backlogs and granting more families a brighter future in the United States.
Promoting Economic Growth with the EB-5 Program
EB-5 investors should monitor the U.S. Citizenship Act of 2021 eagerly, as its enactment could bring radical changes that significantly improve the outlook of an EB5 investment. The EB-5 program offers the Biden administration an excellent opportunity to fulfill its stated goal of immigration-driven economic growth, considering that the program has contributed billions in EB-5 investment capital to the U.S. economy over its three-decade history. The proposed bill would allow the EB-5 program to more efficiently stimulate the U.S. economy, attracting more investors and their EB5 investment capital.