EB-5 Immigration Law Sunset Provisions

Meredith W. Barnette, Esq., Partner
[email protected]

While most of the immigration statutes are permanent and cannot be changed except by Congress, some are temporary and "sunset" after a period of time. These laws are generally valid for a period of several years, and so far, have been extended by Congress. They include those authorizing the EB-5 regional center investor green card, non-minister religious worker special immigrant green cards, and Conrad 30 foreign physician J-1 waiver programs. These programs were recently temporarily extended until December 11, 2015 through the continuing resolution that is funding the government until that date.

The EB-5 Immigrant Investor Program provides green cards to foreign nationals who invest $500,000 to $1,000,000 in the U.S. and create at least 10 full-time jobs for U.S. workers. The provision that allows an investment of $500,000 in a regional center is the sunset provision that is up for renewal every few years, and is much more popular than the traditional $1,000,000 investment requirement (roughly 90% of EB-5 investments are regional center investments). Regional centers are businesses that promote economic growth by increased export sales, improved regional productivity, job creation, and increased domestic capital investment. The regional center investment is $500,000 rather than the traditional $1,000,000 requirement since the business is located in a Targeted Employment Area (TEA), a rural area or an area that has experienced an unemployment rate of 150% of the national average. Despite the program's popularity, there is concern by the government around the program's integrity. Uncertainty about the lawful source of foreign funds and concerns about nonexistent projects deceiving investors have opened the program to a high risk of fraud, according to the Government Accountability Office. With the sunset provision looming, several bills have been introduced in the last few months aiming to continue, but reform, the regional center EB-5 program.

The most recent bills introduced related to the EB-5 program came after the program was temporarily extended in September. One from Senator Jeff Flake (R-Ariz), provides for 5,000 visas set aside for immigrants whose investments go to TEAs, designation of TEAs for qualifying geographic areas for a five (5) year validity, and various definitions for key phrases such as "high unemployment area", "rural" and "TEA". The other, from Senator Rand Paul (R-Ky) would make the regional center program permanent, reform the program to protect integrity, and provide an exemption for dependents from being counted toward the statutory immigrant visa numbers. Reform measures include blocking people with recent fraud violations from certain regional center positions. The Paul bill is the only one introduced that would count investors toward the immigrant visa number quota, not dependent family members, a key provision that would open up the program to more foreign investors.

Two other bills introduced prior to September and the temporary program extension would also make the regional center program permanent, while one would reauthorize the program for five (5) years, increase the minimum investment amount required, and give the Department of Homeland Security more power to regulate the program. Reauthorization of the regional center EB-5 investor green card program appears likely as all of the bills introduced provide for at least a temporary authorization of a few years, but the question remains as to what kind of reform will happen, especially given the existence of previous fraudulent activity in the program.

While up to now, the immigration programs facing sunset have been extended, the process leading to the extension has often created uncertainty within the Department of Homeland Security about petition processing while waiting for extension of the program, as well as uncertainty by religious communities on staffing, by investor businesses on future funding, and by foreign national physicians on ability to secure employment in the U.S. Such extensions are usually announced at the last minute, causing a rush to file cases before the deadline, and each new sunset date raises the risk of the programs' expiration. For now, at least, programs have been extended to December 11, 2015 and it appears that extensions are likely.

For more information on these programs please see our website at (http://garfinkelimmigration.com).