Due to the hotel’s prestigious location in Chicago’s downtown financial district, where we already have developed two successful Marriott hotels (the 610-key JW Marriott and the 381-key Residence Inn) we have studied the economic benefits adding one more floor of hotel rooms so our new Marriott Autograph Collection Hotel would have 310 rooms instead of the planned 232 rooms at the 208 S. LaSalle Street location. Adding one more floor would cost approximately 15 million more to the project cost but will generate substantial additional income and value. The resulting return on cost will be enhanced, thereby reducing project risk.
We feel this is a positive development and will not require an increase in the current EB-5 funds that we intend to raise. We’re looking to start the construction in the beginning of 2019 and will keep you posted on the progress.
According to IIUSA, President Trump signed a short-term continuing resolution (CR) on Friday, September 28. This temporary funding bill defers the deadline for unmade decisions about government funding and programs, including the EB-5 Regional Center Program, to December 7, 2018.
Recall the last time Congress voted a prolonged regional center program extension was 2012. Since then, the program has been extended a few months at a time, relating to government funding.
Below is a graph of history of regional center program authorization since 1992
Figure. The History of Regional Center Program Authorization, 1992-2018. Adapted from “RC program authorization (12/7/2018),” by S Lazicki, 2018, EB-5 Blog. Retrieved October 4, 2018, from https://blog.lucidtext.com/category/eb-5-law-policy/
Invest In the USA (IIUSA). (2018). EB-5 Regional Center Program Extended Through December 7th. Retrieved from https://iiusa.org/blog/eb-5-regional-center-program-extended-december-7th/
On June 19th, 2018, the U.S. Senate Committee on the Judiciary held an oversight hearing on the Immigrant Investor EB-5 Program. The well-attended committee hearing focused on reported fraud, abuse, and national security risks related to the program, and also future path for EB-5.
Throughout the hearing, the sole witness was USCIS Director Francis Cissna. Director Cissna summarized the program background; reported USCIS’s recent steps to improve the program administration and integrity; narrated much-needed proposed policy changes to reform the current program. Furthermore, advocated for legislative reform to address needed authorities for USCIS and to make programmatic changes. Director Cissna indicated that the proposed EB-5 Modernization and Regional Center regulations may take beyond the current September program authorization date to accomplish due to there are multiple agency priorities at the current time.
Attending members seemed open to reform legislation and continuation of the program citing the economic success of EB-5 program in their states.
For more information, you can watch YouTube video record on the hearing at:
Cissna, Francis. (2018, Jun. 19). Hearing on “Citizenship for Sale: Oversight of the EB-5 Investor Visa Program” before the Senate Committee on the Judiciary on June 19, 2018 by USCIS Director L. Francis Cissna. Retrieved from https://www.uscis.gov/tools/resources-congress/testimonies-and-speeches/hearing-citizenship-sale-oversight-eb-5-investor-visa-program-senate-committee-judiciary-june-19-2018-uscis-director-l-francis-cissna
Greenberg Traurig, LLP. (2018, Jun. 19). Senate Judiciary Committee Holds Oversight Hearing on EB-5. Retrieved from https://www.natlawreview.com/article/senate-judiciary-committee-holds-oversight-hearing-eb-5
USCIS issued policy alert on immigrant investor (EB-5) cases involving tenant occupancy on May 15, 2018. Previously, the USCIS Policy Manual allowed for tenant-occupancy methodologies used by I-526 petitioners to prove their investment would satisfy indirect job creation request. The new policy guidance deemed the tenant-occupancy methodology cannot reasonably predict the indirect job creation, and states that it “results in a connection or nexus between the investment and jobs that is too tenuous,” and as a result, will no longer considered it a reasonable way to forecast.
The change has been effective as of May 15, 2018. The USCIS will continue to give deference to I-526 and I-829 filed prior to May 15, 2018, or I-526 petitions that will be filed in future for exemplar-approved projects, as well as approved I-526 petition(s) of another EB-5 investor.
U.S. Citizenship and Immigration Services. (2018). USCIS Policy Manual Updates: EB-5 Tenant Occupancy. Retrieved from https://www.uscis.gov/news/alerts/uscis-policy-manual-updates
Divine, Bearman, and Caldwell & Berkowitz, PC. (2018) . IIUSA Member Analysis: USCIS Evicts Tenant Occupancy Job Counting from EB-5. Retrieved from https://iiusa.org/blog/wp-content/uploads/2018/05/USCIS-Evicts-Tenant-Occupancy-Job-Counting-from-EB-5-1.pdf
Recent tweets from U.S. Citizenship and Immigration Services (“USCIS”) indicate that administrative changes to the EB-5 Program will be a priority for the Fiscal Year 2018. At present, it is almost certain that the proposed regulations introduced more than a year ago will soon be finalized.
The new USCIS Director Lee Francis Cissna, made it clearly that he wants new EB-5 regulations soon. After legislative proposals to reform the EB-5 Program failed to reach consensus in March, on April 5, Senate and House Judiciary Committee chairmen Chuck Grassley (R-Iowa) and Bob Goodlatte (R-Va.) and former Senate Judiciary Committee chairman Patrick Leahy (D-Vt.) in a joint letter to the Secretary of Homeland Security(“DHS”), urging Department to take immediate steps to finalize proposed regulations published in the Federal Register on January 13, 2017, entitled “EB-5 Immigrant Investor Program Modernization”, without further delay.
Important EB-5 reforms included in the “EB-5 Immigrant Investor Program Modernization” proposal are:
• Increased Minimum Investment Amount
• TEA Reforms.
• Priority Date Retention.
Hopefully, Congress will overcome its dysfunctional bi-partisanship and fix the EB-5 program soon.
Wolfsdorf Rosenthal LLP. (2018, Apr. 9). Regulations v. Legislation – On the Brink of EB-5 Reform. Retrieved from https://wolfsdorf.com/blog/on-the-brink-of-eb5-reform/
Grassley, Chuck. (2018, Apr. 5). Grassley, Goodlatte, Leahy Urge Trump Administration to Finalize EB-5 Regulatory Reforms. Retrieved from https://www.grassley.senate.gov/news/news-releases/grassley-goodlatte-leahy-urge-trump-administration-finalize-eb-5-regulatory
On Friday, March 23, 2018, proposed Omnibus bill (Consolidated Appropriations Act, 2018) has passed by Congress and signed into law by President Trump. The Omnibus bill 2018 extended the current EB-5 Program until September 30, 2018.
Earlier in March, IIUSA actively worked with Congress leaders and a group of industrial organizations to review and discuss a proposed “The EB5 Immigrant Investor Visa and Regional Center Reform Act” (EB-5 Reform Act, the “Draft Bill”) in a bid to attach the Draft Bill to the Omnibus, which will extend the EB-5 program until September 30, 2023. On March 20, IIUSA issued statement revealed that the proposed reform failed to receive bicameral support and would not be included in the federal funding bill. It was the 5th time that efforts to reform the EB-5 Regional Center Program have failed.
The current extension does not introduce any new elements into the EB-5 Program. It is critical for foreign investors planning to obtain U.S. residential status through EB-5 program to take immediate action, as to take advantage of the straight extended EB-5 Regional Center Program before its expiration. This straight extension will give lawmakers and the Department of Homeland Security needed time to make substantive changes to the program.
On March 20, 2018, Invest in the USA (IIUSA) issued a statement (https://iiusa.org/blog/iiusa-statement-missed-opportunity/)on the United States EB-5 program’s failure to receive bicameral support and would not be included in the upcoming federal funding bill, which Congress must pass by this Friday March 23. The possible inclusion of program reform and long-term extension in the omnibus bill had brought hopes to the EB-5 industry earlier in March. IIUSA revealed that the proposed reforms did “not gather support from all industry organizations”.
Even though failed to reform program and obtain long-term reauthorization, the draft bill has still included provisions for another temporary EB-5 program extension through September 30, 2018.
This month, members of Congress made a draft proposal to reform the EB-5 Program. The proposals, called the Immigrant Investor Visa and Regional Center Program Comprehensive Reform Act (EB-5 Reform Act), if passed, would be included with the government-spending bill on March 23.
Important aspects of the draft of the EB-5 Reform Act include:
• Re-authorization of the EB-5 Regional Center Program until 2023.
• Improvement and streamlining of the EB-5 process.
• Potential protections for investors whose projects did not pan out.
• 3,100 visas will be carved out from the 10,000 total number of EB-5 visas as set aside for several incentive categories.
• USCIS will not accept more petitions than that year’s quota. If, for instance, the quota is only 2,300, then that’s the maximum number of petitions they will accept that year.
• Minimum investment amount increase from $500,000 to either $925,000 or $1,025,000.
• Less strict targeted employment area proposals.
• Filing fee increases.
• An increase in the number of jobs that are required to be created from 10 to 12.
• The ability to count construction jobs as direct permanent jobs regardless of the duration of the jobs.
• Immediately after the bill is passed, no new EB-5 applications (I-526 Petitions) would be accepted for 120 days.
S Lazicki. (2018, March 11). EB-5 Reform Act, RC List Changes [Blog Post]. Retried from https://blog.lucidtext.com/category/eb-5-law-policy/
Wolfsdorf Rosenthal LLP. (2018, March 13). 10 Things to Know About the New EB-5 Reform Act. Retrieved from https://wolfsdorf.com/blog/10-things-to-know-about-the-new-eb-5-reform-act/
The EB-5 visa usage for Vietnamese applicants jumped 190% year-over-year from October to December 2017. Since almost half of the annual EB-5 visa allocations for Vietnam (approximately 700) has already been used in the first quarter of the current fiscal year, the Visa Office predicts that Vietnam will face over subscription by April , at which time a Final Action Date will be required.
Nearly 45% of EB-5 visas available to Vietnamese nationals in Fiscal Year (F) 2018 (312 out of 697) had already been issued by the end of the first quarter, that is from October 1, 2017 – December 31, 2017.
The DOS has indicated in the February 2018 Visa Bulletin that the Vietnam EB-5 category “will become subject to a Final Action Date no later than April. The China-mainland born, and Vietnam employment fifth preference dates would be the same.” The China Final Action Date is currently July 22, 2014, meaning Chinese investors who filed before this date can get final green card interviews, or file to adjust status. Once Vietnam becomes subject to the same date as China, any of the demand for EB-5 visas from Vietnamese nationals that cannot be allocated for the remainder of the fiscal year (based on DOS’ predictions) will be held in “pending” status.
Each country has less than 700 visas available annually for Vietnam. When one country uses all its available visas (like China for EB-5), applicants from those countries may be allocated unused visas available from the worldwide limit. Any excess EB-5 visas available to oversubscribed countries will be issued based on an investor’s priority date. Unfortunately, because there are so many Chinese investors with earlier priority dates, the Vietnamese will need to wait for those Chinese investors to clear first, or until the new annual limit becomes available at the beginning of FY 2019 (October 1, 2018).
With just hours to spare in order to avoid a government shutdown, the House and Senate approved on December 21 a short-term continuing resolution (CR) funding federal activities through January 19. The CR was approved in the House in a 231-188 vote, and in the Senate by a vote of 66-32. With passage of the CR, Congress has departed for the holiday break and is set to return on January 3. The CR extends the current authorization for the EB-5 Immigrant Investor Program while congressional leadership and interested stakeholders continue to negotiate a long-term measure to reform and reauthorize the program. A long-term reauthorization is unlikely to move as a stand-alone bill and could be included in any spending measure approved in January. Another option for a legislative vehicle would be immigration reform legislation, which has been highlighted by Senate Majority Leader Mitch McConnell (R-KY) as an opportunity for bipartisan cooperation in 2018.