VNIS Investment is pleased to report that the EB-5 Regional Center Program (“Program”) was reauthorized by Congress late last night! The EB-5 Reform and Integrity Act of 2022 was successfully attached to the fiscal year 2022 omnibus spending bill and is now headed to President Biden’s desk for his signature.
The Program’s reauthorization provides enormous relief to past investors who had filed EB-5 applications prior to the Program’s expiration on June 30, 2021. Their I-526 and I-485 petitions, which were held in abeyance by the United States Citizenship and Immigration Service (USCIS) for nearly nine months, will now move forward. This legislation is also welcome news to prospective investors who have been patiently waiting for the Program to reopen.
VNIS Investment is grateful to the members of Congress and their staff who worked diligently on this bipartisan effort to revitalize this important Program. We had always remained confident in this outcome, and while it took longer than we had hoped, we are pleased that the Program has finally been reauthorized.
For prospective investors who would like to file applications soon, VNIS Investment has available investment opportunities that qualify as a TEA. Please contact us for more information.
The EB-5 Regional Center Program is Reauthorized: What You Need to Know?
How do the new rules affect past investors whose petitions were held in abeyance by the USCIS since June 30, 2021?
Past investors’ petitions should now be processed by the USCIS. The new Program requirements only apply to new I-526 petitions.
How long has the Program been extended?
The Program has been extended through September 30, 2027. This is the first longer-term reauthorization of the Program after many years of short-term reauthorizations.
If the Program expires again, does the new legislation protect incoming investors who join the Program while it is still active?
Yes, the Program includes language to protect all investors who file petitions on or before September 30, 2026, which is one year before the next Program expiration date, should the program expire on September 30, 2027.
When do these new rules go into effect?
Most sections in the act will take effect immediately. The Regional Center Program reauthorization and related measures will become effective 60 days after enactment.
Will investors be able to file new petitions immediately?
Investors associated with a Regional Center should wait 60 days after the legislation is enacted to file for an existing project. I-924 project exemplars must also be filed prior to any I-526 petitions in a project. New filings must comply with the new TEA definition, the new investment levels, and the new source of fund rules. Investors should contact their immigration attorneys for further details on the necessary timeframe to prepare their applications.
What is the new minimum investment amount for a project located in a Targeted Employment Area (TEA)?
The new minimum investment amount for a project located in a TEA is $800,000. This amount will remain constant for the next five years. Beginning on January 1, 2027, and every five years thereafter, the investment amount will adjust based on a formula using the Consumer Price Index (CPI).
What are the new TEA requirements?
Under the EB-5 Reform Bill, TEAs will be determined by the Department of Homeland Security (DHS). TEA designations are active for two years and can be renewed for successive two-year periods. To qualify as a TEA, the average unemployment rate for the census tract(s) in which the project is located and any contiguous census tracts must be 150% of the national average. Rural areas continue to qualify as TEAs. Infrastructure projects may also qualify as TEAs if they meet certain criteria.
Does the new legislation provide more transparency and better measures to protect investors from fraud?
Yes, the new legislation includes measures to improve compliance with securities regulations; more transparency for investors; added oversight of projects and investor funds through mandatory site visits, audits, and fund administration; and tighter regulations on who may participate in the ownership and/or management of a regional center, NCE, or an affiliated JCE.
Since redeployment has occurred more often in recent years, are there any changes to how investors’ funds may be redeployed?
Yes, the rules clarify redeployment requirements and provide more flexibility as to the location of redeployment investments, thereby allowing the NCE to source the most appropriate redeployment options for its investors without regard for geographic location within the United States.
What capital needs to be documented as part of the source of funds process?
The requirements for source of funds now apply not only to the capital investment but also to any administrative fees or other fees – such as USCIS filing fees – associated with the investment. Investors should consult with immigration counsel on this process.