The 2020 U.S. presidential election has been one of the most contentious in recent history, with growing polarization fueling animosity on both sides of the political spectrum. After four tense days of Americans’ eyes glued to the results as they rolled out, Joe Biden was finally declared the projected winner of the election. It’s clear that the Biden administration will bring significant changes to the United States, but how will the EB-5 Immigrant Investor Program look in Biden’s America?
Changes to the program are inevitable, regardless of the election outcome, declared Aaron Grau, executive director of Invest in the USA (IIUSA), prior to the election. With the EB-5 regional center program set to expire on December 11, 2020, he expects the government to take a closer look at the program for its reauthorization. President Trump will still be in office during this review and could introduce changes, but subsequent reviews by president-to-be Biden may usher in even more changes in the future.
Trump vs. Biden: Who’s Better for EB-5?
In 1990, when the EB-5 program was enacted, it was approved in the House of Representatives by a whopping 423 to 3, clearly marking it as a nonpartisan program. Despite the broad approval from all both political parties, however, both Trump and Biden tread lightly when it comes to the controversial investment immigration program. Although the EB-5 program was passed to foster economy stimulation, the immigration aspect renders it a controversial program that can be politically dangerous to get too involved with.
Trump is known for being harsh on immigration, but he’s clearly not an enemy of the EB-5 program: EB-5 investors were spared from his April 22, 2020, executive order temporarily suspending immigration in light of the COVID-19 pandemic. When the executive order was extended to the end of 2020, it was expanded to include even more classes of immigrants, but once again, EB-5 investors were given the go-ahead to immigrate. Trump clearly recognizes the economic benefits of the EB-5 investment program.
Biden, conversely, is more supportive of immigration in aggregate, but a Biden presidency isn’t necessarily good news for EB-5 investors. Given the contentious nature of the program, he may prefer to sidestep it and focus on other areas of immigration. A Biden government may also improve the United States’ global image as a country that welcomes immigrants, as many foreign nationals have felt that the United States under Trump is not friendly to immigrants. However, with Biden yet to assume political office in the White House, it’s too early to know exactly what treatment the EB-5 program will receive from his administration.
Senate Control Matters
While most of the attention in U.S. politics is focused on the president, one mustn’t forget that the president isn’t the be-all and end-all. As of November 9, 2020, the Senate and House results have not yet been called, and even though the Democrats have won the federal election, the Senate and the House could still be dominated by Republicans, which would limit the changes the Biden administration could make to the EB-5 program.
The Senate oversees Homeland Security, which manages United States Citizenship and Immigration Services (USCIS), meaning the party that controls the Senate can exercise a lot of power over the EB-5 program. However, support for the EB-5 program isn’t that simple to calculate—as a nonpartisan program, it has support and opposition from both parties. Generally, support for the program is determined more by urban versus rural interests rather than Democratic versus Republican affiliations. The program is often preferred by those in rural areas or somewhat impoverished urban areas due to the targeted employment area (TEA) rules, which changed in November 2019 when the Modernization Rule came into force to more heavily favor EB5 investment in more in-need areas.
The Push for Reform
A further element in the political atmosphere surrounding the EB-5 program is the push for reform, particularly regarding integrity issues. Republican Senator Chuck Grassley of Iowa and Democratic Senator Patrick Leahy of Vermont have collaborated for years to bring about EB-5 reform and tighten its integrity measures. These two senators not only serve as a shining example of the EB-5 program’s ability to cross party lines but also as a real possibility for considerable change to the EB-5 program requirements.
An EB-5 program reform to improve integrity would broadly be welcomed by the EB-5 community, per Grau. Both the staff at USCIS and the Judiciary Committee staff in the House agree that any EB-5 program reform must involve integrity measures. However, when this reform will come, and what precisely it will entail, is still up in the air.