Certain portions of EB-5 visa will expire at the end of this month.
By Raif Karerat
Certain portions of the EB-5 visa program for foreigners, to expedite Green Cards in exchange for investment in projects in the US, are slated to expire on September 30, and critics are arguing one of the most ire-inducing provisions should just be let go.
Congress implemented the EB-5 program as part of an overarching overhaul of immigration policy in 1990. Initially, the visa was only for direct investors who spent $1 million and created 10 jobs, and a separate provision allowed people investing in rural or high-unemployment areas to spend just $500,000.
However, applications were sluggish, so in 1992, Congress decided to also allow private entities to apply to be “regional centers,” which essentially pool foreign investors’ money.
According to The Atlantic, it is the regional centers that have created so much controversy for the EB-5 program:
When it changed the law, Congress allowed regional centers to count the number of indirect jobs their project might create, rather than just direct jobs. So rather than a foreign investor saying he was going to open a factory and employ 15 people directly, a foreign investor could say he was investing in a construction project that would create jobs in a restaurant down the street that might serve construction workers. Now, about 95 percent of EB-5 visas are awarded through regional-center programs, rather than through direct jobs.
A group called the More American Jobs Alliance (MAJA) is one of the critics of regional centers who is advocating for their dissolution.
“There are more than enough direct-job projects in the country to take up the annual quota of EB-5 visas,” MAJA argued in a paid advertisement in The Wall Street Journal.
“The indirect jobs are just not tangible,” Ron Rohde, the group’s secretary-general, told The Atlantic. By contrast, in direct-job programs, he explained that there are “ten names, ten Social Security numbers, and that is who is getting the benefit.”
Foreign interest in the EB-5 program has exploded over the past few years. Applications were lackluster until the recession, according to Steve Yale-Loehr, an immigration lawyer at Miller Mayer and a professor of immigration law at Cornell Law School. However, when financing for construction projects was tough to locate domestically, some developers started to look overseas for funding.
There were only 700 visas issued in 2007; in 2014, for the first time ever, the program reached its quota of 10,000 visas through the EB-5 program and had to stop accepting applications altogether. The quota was reached yet again this year.