Since the expiration of the EB-5 Regional Center Program on June 30, 2021, the EB-5 investment industry has been in a state of uncertainty. Regional center investments were suspended because Congress did not pass the EB-5 Reform and Integrity Act. This bill, which was introduced by Senators Patrick Leahy and Chuck Grassley, would have reauthorized the regional center program for several more years. To the dismay of the EB-5 industry, Senator Lindsey Graham blocked a unanimous consent request to pass the act and thus precipitated the suspension of regional center investments. As of August 12, 2021, the program has not been revalidated.
Many EB-5 investors are understandably worried. United States Citizenship and Immigration Services (USCIS) announced on its website that it would cease to accept EB-5 petitions associated with regional centers. Therefore, foreign nationals who made an EB-5 investment in a regional center before June 30, 2021, may be wondering if they will ever be able to obtain U.S. permanent resident status. This article explains what needs to happen for the regional center program to be reauthorized and shows why this is a critical issue for the entire EB5 investment industry.
How Regional Center Investments Could be Reauthorized
Most likely, the regional center program will resume only if Congress agrees to accept the EB-5 industry’s requests for reform or if industry members compromise and settle for legislation that does not make all their desired changes to EB-5 policies. A bill reauthorizing regional center investments will probably have to be passed as part of a larger legislative vehicle. Fortunately, the upcoming budget reconciliation and infrastructure bills could be used for this purpose.
The various stakeholders in the EB-5 investment industry seem unable to agree on what changes should be made to the EB-5 program. For instance, the Reform and Integrity Act did not stipulate significant changes to EB-5 policies: it only introduced new integrity measures. Many EB-5 industry members were looking for more substantial changes to the program, such as an increased number of available EB-5 visas. Controversial changes like this will likely be met with contention, so it is unlikely for thorough EB-5 investment reform to succeed in Congress.
If the upcoming bills do not result in reauthorization for regional centers, the EB-5 industry should lower its expectations for reform and focus on saving the regional center program. In that case, the Reform and Integrity Act may still be viable as it does not make substantial changes to the industry. Realistically, however, any long-term reauthorization of the regional center program will likely have to be accompanied by at least some of the desired changes to EB-5 policies.
The Importance of Revalidating the Regional Center Program
The EB5 investment industry should do all within its power to secure reauthorization for regional centers—the longer the program remains suspended, the greater the consequences. Many EB-5 visas could be wasted, and regional center investors may eventually lose hope and try to get their capital back. USCIS could even start to deny preexisting regional center I-526 petitions, and the EB-5 program’s reputation would be tarnished as a result.