What You Need to Know about Potential Changes
Final Rule Announcement Expected November or December 2018
The U.S. Office of Management and Budget has published its Fall 2018 Unified Agenda of Regulatory and Deregulatory Actions, which contains updated timetables for two proposed EB-5 regulations and advance notice of a third. The regulation of greatest concern is RIN: 1615-AC07, “EB-5 Immigrant Investor Program Modernization.” This regulation has moved into the final rule stage and is expected to be published in November 2018. Some think these changes could take effect this year, though it’s unlikely based on what we are hearing in D.C. Since the election is over and the Democrats have taken control of the House, we now have an idea of who will chair the Judiciary committees in the Senate and House. Our indications however are that the new chairs will not be anti-EB-5. Continue reading below for a summary on the proposed regulations and potential policy changes:
The significance of Program Modernization Final Rule
If made final in November, the proposed rule could go into effect by the end of 2018. Petitions filed before the effective date of the final rule are expected to qualify under current policy, but once the final rule goes into effect, petitions will be subject to any changes to the EB-5 Program. With that said, we are being told that there may very well be legal challenges to these new proposed rules that could delay the implementation of the increase in investment amounts. Now is the time to file your I-526 petitions.
Anticipated Program Changes Made by the Final Rule
The exact EB-5 policy changes made by this rule will not be known until a final rule is published, but the rule as drafted in the notice of proposed rulemaking included the following primary changes:
(1) An increase to the minimum investment threshold: from $1,000,000 to $1,800,000 for standard investments and from $500,000 to $1,350,000 for investments in targeted employment areas (TEAs)
(2) A shift in TEA designation authority from individual states to the Department of Homeland Security
(3) A refined definition of “targeted employment area” to include metropolitan statistical areas, counties, cities, single census tracts, and limited groups of census tracts experiencing high unemployment rates
(4) Under certain circumstances, the ability for investors with approved I-526 Petitions to keep their priority dates while filing new I-526 Petitions
(5) The ability for spouses and children of petitioners to file I-829 Petitions even if they are not named on the investor’s petition
Actions to Take Now
This much is certain considering these upcoming, potential policy changes: now is the time to assemble project documents and file petitions before any potential changes go into effect. Because the minimum capital requirement is likely to increase substantially, now is the time for investors to make their investments. Nowhere does the proposed rule suggest the policy will be retroactive, which means if investors are able to file their petitions before the proposed policy is in effect, the qualifying investment amount will be $500,000 for investments in TEAs and $1,000,000 otherwise. For those to whom a Green Card for themselves and their families is of critical importance now is the time to act. DO NOT WAIT – for if you do you may find yourself paying twice as much for your Green Card and having to meet more stringent documentation requirements on your source of investment funds. Our office will continue to monitor and report on the potential policy changes, but please reach out to us if you have any questions. We are here to serve you.