Latest EB-5 News
Regional Center Revocation
The USCIS has begun to revoke some inactive RC’s designations.
In one decision USCIS states:
The regional center’s participation as a regional center in the Program … no longer serves the purpose of promoting economic growth. Regional center’s I-924A filings do not report any EB-5 capital investment or job creation for fiscal years 2011, 2012, or 2013.
Some question USCIS’ authority to revoke an approved RC. An Office of Inspection General’s report even commented that there was no such authority.
While it can take even very experienced developers quite some time to locate good projects, hire staff and secure overseas investors, many RC’s remain inactive without funding projects. Some developers wanting to enter the EB-5 field are looking to purchase companies that have an approved RC; however, few seem to be for sale, even if they have no projects.
In my opinion, it is important to use the RC or risk losing it. And if it will not be used, it may be wise to sell the company to someone who will actively run the EB-5 enterprise. We are now working on a RC sale transaction.
RUMORS IN CHINA
The China rumor mills are hot with many doom and gloom predictions, all different versions of the same concepts. They include:
Rumor: The U.S. government does not want EB-5 investors from China.
Martin’s reply: The USCIS is slow in processing all I-526’s, but it approved more EB-5 investors last year than ever before, 80% are from China.
Rumor: The EB-5 for China will end this Spring.
Martin’s reply: The EB-5 quota will backlog this Spring or Summer, NOT end. It will be similar to other immigrant visa categories – there will not be enough China EB-5 visa numbers because there are so many Chinese EB-5 immigrants and the 10,000 annual visas will be exhausted. Thus, there will be a backlog determined by the date of filing the I-526 EB-5 petition.
Rumor: EB-5 investment funds will increase from $500,000 to $800,000.
Martin’s reply: No one knows what Congress will do when the statute is up for extension in September. If $800,000 is a problem, invest now.
TEA TIME IN CALIFORNIA
In May, the State of California will issue its 2015 unemployment statistics for targeted employment areas (“TEA”). Some existing TEAs will no longer qualify; others will become TEAs and some “special” TEAs based on a combination of census tracts may have to be reconfigured.
The TEA for an investor is locked in upon A) the investor filing a I-526 if there is escrow; or B) all $500,000 EB-5 capital is contributed to the new commercial enterprise (not in escrow).