On Dec. 15, Congress agreed to extended the EB-5 immigrant investor program until Sept. 30, 2016, without changes as part of an omnibus spending bill. The program has provided funding that has reinvigorated neighborhoods throughout the country. However, some California developers and investors may not be aware that this program has been under fire since it was introduced in 1990.
The introduction of the EB-5 program allowed foreign investors to obtain U.S. visas when they invested $1 million in projects that create a minimum of 10 jobs. Later, the program was modified so that investors only needed to invest $500,000 in high-unemployment or rural areas to obtain visas. The number of EB-5 investor visas that United States Citizenship and Immigration Services can issue is capped at 10,000 a year, including up to two family members of the investors.
Congress added “regional centers” to the program, to which developers may apply to join so that foreign investors can pool together money for larger projects, such as hotel and ski resorts. The centers were created to pinpoint areas that need a boost in employment the most. According to statistics, about 90 percent of foreign investors go through the regional center.
USCIS estimates that the program has attracted more than $10 billion in funding and created over 77,000 jobs. Most of the foreign investors who participate in the program are Chinese, and they typically join larger development projects through regional centers. However, people are unsatisfied with the regional centers, arguing that related projects could be messed with so that developers can build luxury projects in upscale areas with money from the program. The misuse of funds and several instances of fraud have meant that foreign investors and U.S. developers have lost millions of dollars.
Some foreign investors may be interested in obtaining investor visas through the EB-5 program but need help gathering all of the documentation required. These foreign investors may want to obtain the assistance of an immigration attorney during the application process.
Source: SFGate, “Congress extends EB-5 ‘visa for investment’ policy until Sept. 30,” Kathleen Pender, Dec. 16, 2015