On January 12, 2017, the Department of Homeland Security (DHS) advised that it would publish an advance notice of proposed rulemaking on January 13, 2017 to make regulatory changes to update the EB-5 Immigrant Investor Program. Comments will be due 90 days from the date of publication. As such, no regulatory changes have been made based on these proposals to date.
Increase in investment: The biggest change involves increasing the minimum investment amounts from $500,000 to $1.35 million in Targeted Employment Areas (TEAs; i.e. areas in which the unemployment rate is at least 150% that of the national average), and from $1 million to $1.8 million in non-TEAs. DHS also proposes adjusting the minimum investment amounts based on inflation rates every 5 years from the date the regulations are published.
Retaining priority date: Another big change would allow certain investors to retain their EB-5 immigrant petition priority date to use with any subsequent EB-5 immigrant petition. This change would be particularly helpful for investors with EB-5 immigrant petitions who may have had to file new EB-5 petitions due to circumstances beyond their control, such as if a regional center is terminated, which effectively terminates the petition of the investor who invested into a project affiliated with that regional center. This change would also benefit those who simply choose to make a change that would be considered “material” (i.e. a change that results in a substantial difference in the circumstances that USCIS relied on to make a decision on the case). Currently, investors are forced to lose their “place in line” for an EB-5 immigrant visa if they already filed an EB-5 petition and have to file a new one.
TEA designations: There are a number of changes aimed at eliminating regional differences in determining TEA designations. First, DHS proposes that it would directly establish TEAs, such that States would no longer be allowed to do so. Secondly, in addition to larger Metropolitan Statistical Areas (MSAs), cities and towns would also benefit from TEA designations if they experience high unemployment (i.e. at least 150% the national unemployment rate) and have a population of at least 20,000. Third, DHS proposes standardizing an alternative to the way that proposed TEA areas are designated by focusing on census tracts, as opposed to only doing so on a case-by-case basis. For instance, if an EB-5 project is located in a census tract that does not independently qualify as a TEA, DHS would routinely be able to provide a TEA designation if the weighted average of the project’s census tract and the directly-adjacent census tracts would qualify as a TEA.
Removal of Conditions: The proposed regulations would make it clear that derivative family members must file their own Form I-829 petitions to remove conditions on their green cards if they are not included in the principal investor’s Form I-829 petition, which is currently not clear in the regulations. The proposed changes would also provide greater flexibility in determining the interview location (if an interview is required) related to the Form I-829 petition.
Jackson & Hertogs will continue to keep our clients apprised of future developments. Do not hesitate to contact us for a consultation.
