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CMB Regional Centers' Analysis On The Reauthorization Of The EB-5 Regional Center ProgramMarch 11, 2022

The EB-5 Reform and Integrity Act of 2022 has officially been attached to the federal omnibus spending bill by the US House of Representatives, which is slated to be voted on and passed by House and Senate ahead of the March 11, 2022 deadline. The bill is the result of a lengthy bipartisan effort to reform the EB-5 Regional Center Program headed by Senator Chuck Grassley (R-IA).


The bill includes numerous changes to the EB-5 program, including new protections for investors, a change to the minimum investment amount, and new integrity and compliance requirements for regional centers. Below is a high level summary of some of the important changes that are included in the new law.


Effective Date and Authorization


The bill will extend the EB-5 regional center program through September 30, 2027. Although the changes to the minimum investment amount and TEA regulations (discussed below) will take effect immediately, the regional center program will not officially be reauthorized until 60 days after the bill passes.


Grandfathering


The new bill includes protections from future regional center program expiration for investors that have already filed their I-526 petition with the USCIS and new investors who file prior to September 30, 2026. If the regional center program were to lapse again, those investors that filed their petitions prior to September 30, 2026, would remain eligible to continue with the EB-5 immigration process.


CMB is very excited to see this language included in the bill as we saw this provision as necessary integrity to protect all investors that have invested into the EB-5 Regional Center Program. Now through September 30, 2026, EB-5 investors can now move forward with certainty that their immigration petitions will be adjudicated (even those in countries with a long wait list).


Minimum Investment Amounts


The new minimum investment amount will be $1,050,000, which is reduced to $800,000 if the EB-5 project is located in a Targeted Employment Area (TEA) or is an infrastructure project. A TEA includes an area of high unemployment or a rural area, and must qualify under the same requirements as the previous EB-5 regulations that were introduced in 2019. An infrastructure project is a public works project in which a governmental entity is the job-creating entity that receives the EB-5 capital from the new commercial enterprise.


Job Creation (Direct and Indirect Limits)


Indirect jobs can now only account for up to 90% of the job creation required for an EB-5 visa, or up to 75% if the construction of the project is less than two years. The remaining required job creation must be through direct job creation, which can be proven using reasonable econometric methodologies.


Visa Set Asides


A certain number of the total amount of approximately 10,000 annual visas allocated to the EB-5 program will now be ‘reserved’ through visa set asides each year for investors that invest in certain categories: 20% of all visas will go to investors who invested in projects that qualify as rural, 10% for high unemployment areas as defined under the new law, and 2% for infrastructure projects.


Regional Center Requirements


The bill includes numerous stringent new requirements for regional centers in relation to securities compliance, record keeping, ownership, and administration. All regional centers will undergo a USCIS audit at least once every 5 years. Additionally, a new integrity fund has been created in which regional centers must contribute $10,000-$20,000 annually (depending on the size of the regional center) to allow the USCIS to investigate and monitor the all of the parties within the EB-5 industry to ensure compliance.


Promoters


All direct and third-party promoters working in the EB-5 program must register with the USCIS. This includes broker-dealers in the United States and all migration agents, consultants, and finders in other countries. All fees paid to these promoters must be disclosed in writing to the investor in detail, which will be filed the investor’s petitions. Additionally, the promoters must comply with certain bad-actor requirements in order to be eligible to participate in the EB-5 program.


CMB Regional Centers


CMB is extremely excited for the future of the EB-5 program, as is protects past investors and provides the much needed integrity we have all been advocating for years. This new legislation paves the way to realize EB-5's full potential as a job creation tool for the U.S. economy.


As one of the oldest and most successful regional centers in the industry, CMB is looking forward to providing high quality EB-5 investment opportunities to those who want to pursue permanent residence in the United States.


Sincerely,


CMB Regional Centers

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