By Robert P. Gaffney, Esq.
USCIS has announced that on July 24, 2019 it will publish the long-awaited EB-5 Immigrant Investor Program Modernization Regulation. The new rule which will go into effect on November 21, 2019 will make a number of significant changes to the requirements for immigration based upon investment. Principal changes under the new rule of interest to prospective EB-5 investors include the following:
Increase of Minimum Investment Amount.
The current minimum investment amount for projects principally doing business in a “targeted employment area” or “TEA” is US$500,000. Investments outside of a TEA currently require a minimum investment of US$1,000,000. Under the new rule, effective as on November 21 the minimum required investment for new EB-5 investors in projects located in a TEA will be US$900,000. The new rule requires a US$1.8 million investment amount for non-TEA projects. Petitions filed before November 21 will continue to qualify at the current investment minimums.
Targeted Employment Area Provisions.
For purposes of qualifying for the lower investment threshold, a TEA is defined as a rural area or an area that has experienced unemployment of at least 150 percent of the national average rate. The new rule takes away from the states the authority to designate areas of high unemployment which qualify as TEAs and grants exclusive jurisdiction for making TEA determinations to USCIS at the time of I-526 adjuciation. The new rule also makes several significant changes to the requirements for qualifying a project area for designated TEA status. Among these changes, the new rule restricts the ability to qualify a project for TEA designation by averaging unemployment across multiple census tracts, limiting TEA qualification to the census tract(s) in which the new commercial enterprise is principally doing business and any and all adjacent tracts. The impact of the TEA provisions of the new rule will include greatly restricting the ability of investors to qualify for investment at the reduced investment amount of $900,000 through investments in projects located in many of the more urban and economically advantaged areas which have attracted much EB-5 investment in recent years.
Priority Date Retention.
Current EB-5 regulations do not permit investors to use the priority date of an immigrant petition approved for classification as an investor for a subsequently filed immigrant petition for the same classification. The new rule will allow an EB-5 immigrant petitioner who has not already used an approved I-526 petition to become a permanent resident to use the priority date of an approved I-526 immigrant petition for a subsequently filed I-526 petition unless USCIS revokes the prior petition’s approval for fraud or willful misrepresentation by the petitioner, or revokes the petition for a material error.
In addition to the November deadline for filing petitions under the current EB-5 regulations, prospective investors should also note that while it is generally expected that the Regional Center program will be extended beyond its current expiration date of September 30, 2019, investors seeking to reduce the risk of program expiration will want to take steps to file their I-526 petitions before the end of September of this year.
If you are considering immigration through participation in the EB-5 immigrant investment program and have additional questions about the process, please feel free to contact our offices at [email protected] to schedule a consultation with one of our EB-5 experts.