EB5 Capital hosted six webinars in four languages that focused on the reauthorization of the EB-5 Regional Center Program. When the Program lapsed on June 30, 2021, all pending I-526 petitions and I-485 petitions were put on hold by the USCIS. Investors who have yet to complete their consular processing with the National Visa Center were also held in abeyance. This blog post contains selective questions from these six webinars, answers to these questions by EB5 Capital’s President, Brian Ostar, and a revised update on the status of the Program.

We will be hosting additional webinars in the near future

How have investors with petitions on hold been impacted since the Program’s expiration?

So far, investors have lost five months of processing time. Since the Program is not likely to be reauthorized until December or early next year, investors may lose a total of six to eight months of time. The USCIS posted on its website recently that it will keep petitions on hold until at least the end of the calendar year until there is new guidance. This recent notice on the USCIS’ website is a reminder to Congress that, if the Program’s reauthorization is not resolved soon, the agency may feel compelled to start denying petitions. If this occurs, it will be politically problematic for Congress.

Are investors still able to file Form I-765 and Form I-131 with an expired Program?

Yes, these forms can still be filed if the individual has a pending I-485 application for adjustment of status. Form I-765 is filed to request an Employment Authorization Document (EAD). Form I-131 is filed to request a travel document, such as advanced parole. Both forms are typically filed concurrently with the I-485 application for adjustment of status. The USCIS has confirmed that it will continue to accept and adjudicate Forms I-765 and I-131 relating to pending I-485 applications to adjust the status based on an approved I-526 petition. We recommend consulting with your immigration attorney prior to any international travel or filing immigration applications.

What legal action can be taken if an investor is left waiting for an unreasonable length of time for the USCIS to adjudicate his/her petition? What is considered unreasonable and what can investors do?

There are a few options. The first thing an investor can do, if the USCIS denies a case due to the sunset, is file a lawsuit. I [Brian Ostar] don’t think this will happen because reauthorization or grandfathering language will likely come first. However, if there is a denial, there will almost certainly be a lawsuit. If an investor sues the USCIS, then all other denials will likely be put on hold, and the investor who sued will likely win. Second, once the Program is reauthorized, if the processing time is above the national average posted on the USCIS’ website, then investors may be able to file a “mandamus” lawsuit seeking a court order forcing the USCIS to adjudicate swiftly. This is another important question to confer with your immigration attorney.

What is the incentive for the USCIS to legacy in existing investors?

The incentive is for the United States to honor its commitments. If the USCIS does not follow through with its commitment to processing visas after investors have satisfied the Program requirements, then it would damage the reputation of the EB-5 brand, and more generally the image of the United States. EB-5 investors come from all around the world, and there is a vast range of petitioners – some are very connected in political circles. Tens and thousands of investors are already in the queue, and it would be a legal and political nightmare for the USCIS if investors were not made legacies. 

How does the Program’s expiration impact the return on capital for investors?

It doesn’t. The offering documents remain the same. The return of capital can only occur after two events have been satisfied: the completion of the investor’s Lawful Permanent Resident (LPR) period, along with the timely filing of their Form I-829 petition, and a capital event in the project. If reauthorization continues to lag, then the probability of redeployment increases, but the terms of the redeployment remain the same, consistent with the offering documents.

What impact does this expiration have on other parties outside of EB-5 investors?

I do not think anyone is benefiting from the lapse of the Program. Certainly, cities and states have been depending on this capital for a long time. Regional Centers, immigration attorneys, and all the other EB-5 stakeholders and parties involved are not benefitting either. The United States, in general, is not benefitting.

Why didn’t EB-5 receive the unanimous vote that it needed before June 30, 2021, when the EB-5 Reform and Integrity Act (S.831) was introduced?

Though Senator Lindsey Graham (R-SC) has been one of the most prominent supporters of EB-5, he objected to S.831 because it only addressed integrity measures. He would rather pass a broader package that focuses on a dozen different core issues. Although the entire industry agrees that there is a need for integrity measures, many stakeholders did not want to handle the legislation piecemeal. They wanted comprehensive EB-5 legislation covering many issues, not specifically related to integrity. For instance, S.831 did not address the investment amount, the short-term nature of the Program, visa availability, processing times, redeployment, and other issues.

Why didn’t the Program get reauthorized on September 30, 2021, when there was an opportunity for it to get reattached to the Continuing Resolution? Was there any legislation being discussed during the weeks leading up to September 30, 2021, or was it just an opportunity for a clean extension with the Continuing Resolution?

After June 30, 2021, the industry realized that we needed a more comprehensive package. That package was not ready for consideration by September 30, 2021. Plus, Congress had many other important priorities to consider such as the infrastructure bill, the raising of the debt ceiling, and the U.S. withdrawal from Afghanistan.

What is likely to happen next with the Program? What if EB-5 is not reauthorized before the end of the year? What is the new realistic timeline that people can expect for the USCIS to start adjudicating petitions?

Currently, there is comprehensive draft legislation being considered by congressional members and industry stakeholders, and these negotiations on Capitol Hill are making progress. We are finally seeing a level of compromise that we have been trying to obtain for several years and consensus is growing around key terms. After legislation is finalized, it needs to be attached to a vehicle like the 2022 fiscal appropriations. It is possible that by December 3, 2021, the government will extend the Continuing Resolution for two additional weeks, or even until Q1 2022.

The legislation includes protection for investors who filed prior to the Program’s expiration. If this legislation does not pass in December, there is a possibility that the executive branch could direct the USCIS to adjudicate petitions – or to, at least, continue to keep them on hold. Another option involves the courts. If an investor is denied and there is a lawsuit, then a court could overturn that decision and force the USCIS to start adjudicating petitions. So, there are multiple ways to protect investors.

What is your advice to people right now while we are in this limbo period?

Be patient. We are doing everything we can to move things along. The industry has banded together — IIUSA, EB5-IC, AIIA, AILA, the Rural Alliance, other influential Regional Centers, highly respected immigration law firms and lawyers, and others. Everyone is working on reauthorization around the clock, and there is not much a single investor can do except be patient and stay informed.

The EB-5 Program expired on June 30, 2021. There can be no assurance that the EB-5 Program will be reauthorized, or that applications submitted before the EB-5 Program’s June 30, 2021, expiration will be adjudicated by the USCIS if the EB-5 Program is not reauthorized. Therefore, a Limited Partner who has not obtained conditional permanent residence before the law’s June 30, 2021 expiration runs a risk of the loss of the opportunity for immigration status through the investment. Consequently, no assurance can be given that any Limited Partner will obtain approval of his or her particular immigration petition for conditional or permanent resident status by participating in a Redeployment into an Alternative Investment as a Limited Partner. This blog is provided to you for informational purposes only and is not intended as legal advice. You should consult with your own immigration counsel or advisor regarding the impact of the current program lapse on your EB-5 immigration process.