Latest EB-5 News
Surge, TEA and Grandfathering
The surge is over, for now. We filed many I-526s, exemplars, and new Regional Center (RC) applications before the EB-5 RC statute expiration on September 30, 2015. The Congress today extended the current EB-5 RC statute to December 11. No one knows for sure what Congress will do then, but my well placed Washington contacts think an appropriations bill in December will extend the RC statute with many changes including increasing the investment amount. Following is a discussion of some of the key issues on which Congress cannot yet seem to agree.
My sources in Washington D.C. say that Regional Centers are losing the TEA battle. What is winning the day is possibly a 3 tier system – $800,000 investment in a TEA and 10 jobs created per investor with the USCIS determining what is a TEA (i.e. no gerrymandered districts); a mid-tier $1 million investment and 15 jobs; or $1.2 million and 10 jobs. The thinking is investors will spring for the higher $1 million amount for “big” projects which are usually in urban areas.
If you don’t want to lose the TEA battle, you need to get into the office of your Senator and Congressional Representative. No one will win this battle for you.
The proposed Senate bill S. 1501 provides for grandfathering of the minimum investment amount at $500,000 in a TEA and locking in current TEA criteria with the filing of an exemplar. Congress is keen on raising the investment amount and they do not want Regional Centers to be able to take in a lower amount of capital for years to come. The final bill will probably require grandfathered $500,000 investors’ I-526s to be filed within 12 or maybe 24 months.
Some expect the final bill to require more than an exemplar or an investor’s I-526 filing to grandfather the entire project at the $500,000 investment threshold. It is unclear what more a project will be expected to accomplish for grandfathering.
Also, many believe the bill will require exemplars for all future projects, as provided in S. 1501, thus filing an exemplar before the new bill probably will not be for naught, as one will eventually be required.
I will keep you posted.