Sens. Grassley, Leahy Oppose Reauthorization of Unaltered EB-5 Regional Center Program; Rep. Goodlatte Introduces EB-5 Reform Bill
A lot has been happening the last few days in the EB-5 world. The regional center part of the EB-5 immigrant investor green card program is scheduled to expire on September 30, 2016. On September 8, Sens. Chuck Grassley (R-Iowa) and Patrick Leahy (D-Vt.), chair and ranking member of the Senate Judiciary Committee, respectively, wrote a letter to Senate leadership opposing a straight reauthorization of the EB-5 regional center program without any changes. According to the letter, the EB-5 regional center program “has become plagued with fraud and abuse, and if not reformed it should be allowed to expire on September 30th.”
Then, late Friday afternoon, September 9, Rep. Bob Goodlatte (R-Va.), chair of the House Judiciary Committee, released a draft of an EB-5 reform bill. The 123-page bill would make significant changes to the EB-5 program, such as increasing the minimum investment amount from the current $500,000 to $800,000, and adding anti-fraud and securities law oversight provisions. The bill was re-released on September 12 with Rep. John Conyers (D-Mich.) as a co-sponsor. The revised bill contains a two-page addition for good faith defrauded investors. The revised bill was introduced as H.R. 5992.
Among other things, the bill would:
- Reauthorize the EB-5 regional center program for five years, until September 30, 2021
- Set aside 4,000 EB-5 visas for rural and “priority urban investment” areas to take effect October 1, 2016
- Allow investors 180 days after a regional center is terminated or debarred to associate the new commercial enterprise (NCE) with a new regional center or to invest in a new NCE
- Require investors to be at least 18 years old, effective after enactment
- Require an EB-5 investor’s tax returns for the last seven years
