Lengthy processing times for I-526 petitions have long plagued the EB-5 Immigrant Investor Program, leaving qualified investors in limbo for years waiting for their conditional permanent resident status. For those unfortunate to hold a passport from a backlogged country—as of March 2021, China and Vietnam—waits are even longer. Despite the ever-growing processing delays, United States Citizenship and Immigration Services (USCIS) has done little to address inefficiency, instead focusing on staying afloat amid financial difficulties.
The long processing times have been turning prospective participants away from pursuing an EB-5 investment, and it’s understandable—the time and effort required for an EB5 investment may not be worth it if an investor would be satisfied with Canada’s or Australia’s residency-by-investment program or if they have children in danger of aging out of eligibility for a U.S. green card. However, in 2021, the situation is looking up for EB-5 processing times, and it may just be the perfect time to jump into an EB-5 investment.
Estimated Processing Times Don’t Match Historical Average Processing Times
When a prospective investor sees 35.5 to 68.5 months listed as the estimated processing times for an I-526 petition, they may lose motivation to make an EB5 investment. But the estimated processing time range is misleading for numerous reasons, the first being that the majority of I-526 petitions are processed outside the range. Indeed, the lower number indicates the time by which 50% of petitions are adjudicated, while the higher number shows the time by which 93% of petitions are processed. If the estimates are 100% accurate, that leaves 57% processed outside of the range, with 50% processed sooner than indicated.
USCIS’s historical average processing times back up this fact. The 35.5 to 68.5 months displayed in the estimated processing time range is a far cry from the 14.2 months indicated as the historical average processing time for I-526 petitions in 2020. Thus, even without changes to the EB-5 program, an investor’s petition has a high chance of being adjudicated far before they might expect. But changes are likely to come to the EB-5 program—changes that could significantly speed up the EB5 investment process.
Proposed EB-5 Reform
EB-5 investment stakeholders have long been rallying for reform to the popular residency-by-investment program, and 2021 may be the year it finally comes. Long-time EB-5 allies Chuck Grassley and Patrick Leahy, who have formed a bipartisan partnership, have introduced the EB-5 Reform and Integrity Act, which proposes to alter various aspects of the EB-5 program to increase security, better protect honest actors, and procure long-term authorization for the EB-5 Regional Center Program. The regional center’s approaching sunset date of June 30, 2021, acts as the impetus the industry needs to finally pass reform, as reform is seen as the key means to saving the regional center program.
Though the EB-5 Reform and Integrity Act concentrates on integrity measures, as suggested by its name, it includes a provision to speed up processing times. Under the bill, USCIS would be required to adjudicate investor petitions in under 240 days. If the EB5 investment was made in a targeted employment area (TEA), the processing time would be reduced to just 120.
Biden’s Proposed USCIS Reform
The EB-5 Reform and Integrity Act isn’t the EB-5 program’s only shot at reform in 2021. The Biden administration has also proposed an overhaul to the U.S. immigration system as a whole, and though this bill would not directly reform the EB-5 program, the changes it would bring would have a massive positive effect on the EB-5 industry.
Included in the bill, titled the U.S. Citizenship Act of 2021, are provisions to accelerate processing for all visas, including the EB-5 visa, as well as various proposals that would result in more visas available to EB-5 investment participants. For example, the bill endeavors to recapture unused visas and reuse them in the same program the next fiscal year instead of rolling them over to other programs, which could prove crucial for the EB-5 program to retain the thousands of extra visas allocated to it in FY2021. Another proposal—one that would see spouses and dependent children exempted from employment-based visa quotas—would free up thousands of EB-5 visas annually that would otherwise be claimed by investors’ immediate family members.
For Chinese investors, whose disinterest in the EB-5 program may be particularly strong given the massive Chinese backlog, Biden’s proposed USCIS reform offers important changes. One of them is a mandate for USCIS to clear its many lengthy backlogs, which could finally end the years-long wait Chinese EB5 investment participants have been subject to. A second change is the abolishment of country-based limitations, which would free up countless EB-5 visas for investors from China, Vietnam, and other high-population, high-demand countries.
Beat the Rush: The Best Time to Invest Is Now
Neither of these bills have been passed yet, but the best time to make an EB-5 investment is before they’re passed. Considering the massive, wide-reaching, and positive effects these proposed changes would have on the EB-5 industry, enactment of either one (or better, both) could see a flood of new I-526 applications, and those who beat the rush would clearly be in a preferable position. The outlook for new EB-5 applicants may look bleak, but the reality is that, with a combination of accelerated processing times and a larger supply of EB-5 visas, investors may receive their U.S. permanent residency rights far more quickly than expected.