Part of the EB-5 Investor Immigrant category is a Pilot Program for regional center investors. Regional Centers are a way for qualified EB-5 investors to pool their resources rather than focusing on individual investment projects. This means a larger amount of capital is able to be centralized in a region and directed towards many different types of projects more efficiently than if a single investor tried to manage each project independently. The Pilot Program also allows investors to be credited with creating jobs indirectly with their investments. Indirect job creation can be such things as construction workers employed during the development of investment projects or new jobs created as other non-affiliated business in a region grow in reaction to an investment project.

The Pilot Program currently has a “sunset” date of September 30, 2012. After this time, without an extension of the deadline, no new regional centers will be created and no new applications for EB-5 visas will be eligible to take advantage of indirect job creation. An I-485 “Petition to Register Permanent Residence or Adjust Status” must be approved for an EB-5 regional center applicant on or before the deadline to take advantage of this program, if it is not extended. If the extension is not made then Pilot Program visa will no longer be available and thus consular processing for a green card will also be affected. In response to the approaching sunset date, the United States Citizenship and Immigration Services is expediting the adjudication of both forms I-526 “Immigrant Petition by Alien Entrepreneur” and I-485. Since the EB-5 preference category does not allow for concurrent filing of forms I-526 and I-485, an approved I-526 is necessary before an I-485 can be submitted for approval. At this late date the submission of an I-526 will probably not leave enough time before the deadline to get approval and submit an I-485 to be approved. If an alien is already adjusting status or consular processing based on an approved Pilot Program I-526 when the sunset date is reached the USCIS and Consulates will hold pending applications until a final decision on the program is made by congress. If the sunset date is extended the adjustment of status or visa process will continue.

Since its creation in 1992, the EB-5 Pilot Program has been extended several times up to its current deadline of Sept. 30, 2012. While bills have been proposed in the past to make the pilot program a permanent element of the EB-5 preference category, none of these have yet passed. It is more likely that Congress will continue to extend the EB-5 category into the foreseeable future due to the large amounts of money involved in regional center investments.

Why the EB-5 Pilot Program is Beneficial

The likelihood of the EB-5 Pilot Program not being renewed is not very good. There is simply too much money involved in the program. Beyond the fact that the program brings in large amounts of capital to create jobs in regions of the US through investment, regional centers also act as providers of capital to local business interests as well. If banks are not lending, or are lending at rates unfavorable to business growth, EB-5 regional centers can take on the role of providing equity capital to a community’s projects almost like an investment bank.

With the wide areas being invested in by regional centers there is much more potential for expanded growth in job creation than if an investor were to start an investment project by him/herself. This benefit has been noted by the Congress, the President, AND the USCIS. Barring some unforeseen disaster in the next month this level of support suggests a planned extension of the program.

EB-5 Will Continue

The September sunset date should not be confused with a sunset date for EB-5 category in general, as only the Pilot Program will potentially be affected. The Sept. 30, 2012 sunset date does not affect the entire EB-5 program. Alien investors will still be eligible for immigration benefits based on investments after the sunset date. However, all future I-526 filings will have to be for investors who will individually create 10 direct jobs in connection with their investment. New applications will no longer be able to use the regional centers’ indirect job creation benefit of the past, but the EB-5 program itself will continue as there is not statutory time limit on the immigrant investment category itself.

Should Applicants Rush to Apply?

It is an uneasy situation to predict the future based on the past, but there is no reason to currently believe that the EB-5 Pilot Program will not be extended. There has been continued bi-partisan support for the program in the US congress and from the President and issues of fraud have not arisen to draw critical attention to the program’s immigration benefits. As has happened in the past, the Pilot Program is expected to be extended.

Yet, this is still not a certainty and questions of who should file and when become important in a “what if” scenario. As mentioned above, while the Pilot Program may end after Sept. 30, 2012, the EB-5 preference category will continue regardless. If the Pilot Program is not extended there will no longer be the creation of new regional centers and an alien’s investment will have to DIRECTLY create 10 new jobs for US workers, but there will still be the option of permanent residency for investors. So for aliens who would prefer to file an I-526 as a Pilot Program investor but have not started the process yet it may be beneficial to wait until a final decision is made on the extension of the Pilot Program to apply. Visa numbers are almost always current for the EB-5 category so an early priority date based on filing of I-526 is not as important as other employment-based categories. If the extension to the Pilot Program is made an alien can become an investor in a regional center and benefit from indirect employment creation. If not, the alien can still become an EB-5 permanent resident through the normal investment system.

For aliens who have an approved I-526 there is still enough time to receive an approved I-485 before the sunset date if the application is made quickly. This is not to say that an alien must rush to apply, but if all that is left is an I-485 application there is still that option (submitting an I-485 before the beginning of September is preferable).

All Forms I-526 and I-485 submitted as part of the Pilot Program submitted before the sunset date yet non-adjudicated will be held by the USCIS for a reasonable amount of time while a final decision on extension is made (it is possible that the sunset date could pass and an extension to the program happen sometime later). If the Pilot Program is extended then the petitions and applications will be based on the program to which they were applied upon submittal. If the Pilot Program is not extended then any I-526s and I-485s will be adjudicated based on the normal EB-5 criteria (mainly, direct job creation). With this in mind, if an alien wishes to apply immediately for a regional center-based I-526 it may be beneficial to account for this possibility of being adjudicated under standard EB-5 criteria. If submitting an I-526 this close to the deadline and alien could show how their investment will create 10 jobs directly, in addition to the regional center job creation, in an effort to cover both bases if the Pilot Program is not extended.

Conclusion

There is currently a bill in Congress, approved by the Senate and awaiting a decision from the House of Representatives, which would extend the EB-5 program for another 3 years. This is a good sign that the Pilot Program is a priority to the Government and will be extended by the deadline. Even if the sunset date comes and goes there is still the possibility that it will be extended yet again while petitions for the program are held in wait of a final decision.

An alien seeking EB-5 permanent resident status with either an approved I-526 or without having started the immigration process should contact an immigration attorney to determine the best path forward this close to the sunset date. Whether an alien wants to explore expedited adjudication or prepare there I-526 to meet both Pilot Program and normal EB-5 standards, and experience immigration attorney with years of practice in EB-5 petitions will be able to help pick the best and most efficient option of filing.

Sources:

Federal Register Vol. 76, No. 188

112th Congress, 2d Session: S.3245

DOS Foreign Affairs Manual, Volume 9: 9 FAM 42.32(e) N7-N10

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Founded in 1996, Zhang & Associates, P.C. offers legal services to clients nationwide in all aspects of U.S immigration law. We have successfully handled thousands of immigration cases.

At Zhang & Associates, P.C., our attorneys and supporting professionals are committed to providing high-quality immigration and non-immigration visa services. We specialize in NIW, EB-1, PERM, and I-485 cases. In the past sixteen years, we have successfully helped thousands of clients get green cards. If you plan to apply for a green card, please send your CV to Attorney Jerry Zhang (info@hooyou.com) for a free evaluation.

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(08/30/2012)