EB-5 Changes: Leahy & Grassley EB-5 Bill Proposal
EB-5 Changes for 2015 are Starting To Take Shape:
EB-5 changes are in the midst for 2015 as the program expires on September 30,2015. in its current form. Senate Judiciary Committee Chairman Charles Grassley (R-Iowa) and Ranking Member Patrick Leahy (D-Vt.) have introduced S. 1501 (American Job Creation and Investment Promotion Reform Act of 2015), legislation to reauthorize and initiate EB-5 changes and improvement. This is simply a bill and not a law and will likely undergo multiple revisions with content contributed from all angles of the industry. The bill is a positive FIRST STEP for the new EB-5 changes and it is a long journey to finalizing the reauthorization.
EB-5 Changes: Why is this important?
This is the first Bill where we have seen the main political stakeholders come together and actually draft a comprehensive reform bill. This is a major milestone for the conversations in general.
What are the EB-5 changes?
For the sake of time, I am placing the text from EB-5 Insights post about the summary of the Bill. Laura list the proposed EB-5 changes very clearly.
See the whole article here:
Bi-Partisan Legislation Introduced in the Senate
The content written by Laura Reiff of Greenberg Traurig
EB-5 Investment Coalition Applauds Bipartisan Effort on Reform
Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa) and Senate Judiciary Committee Ranking Member Patrick Leahy (D-Vt.) introduced bi-partisan legislation to extend and improve the job-creating immigrant investor visa program, known as EB-5, which is set to expire in September. The American Job Creation and Investment Promotion Reform Act would reauthorize the EB-5 Regional Center program for five years and add measures to improve the program’s integrity.
We now have bi-partisan bills introduced in both the House and Senate
. The bill will, among other things:
- Extend the program for five years;
- Provide increased authority to DHS to deny or terminate applications where there is fraud, criminal misuse, or a threat to public safety or national security;
- Establish an “EB-5 Integrity Fund” in which regional centers would pay an annual fee to be used by DHS to conduct audits and site visits to detect and investigate fraud in the United States and abroad;
- Require background checks of regional center and project developer principals;
- Require DHS to vet EB-5 projects earlier in the process, before investors submit applications;
- Require increased disclosures to investors regarding business risks and conflicts of interest;
- Require more oversight of projects and closer monitoring for securities compliance;
- Amend the definition of “Targeted Employment Area” (TEA) to favor more investment in areas with high unemployment and rural areas;
- Raise the investment threshold to $800,000 for TEAs and $1.2 million for non-TEAs; and
- Decrease petition processing times providing for expedited business plan approval and requiring fees be adjusted to the rate necessary to achieve efficient processing.
There is yet a lot of work to be done in both the Senate and the House to reach the right balance in this reform legislation.
The livelihood of many of the EB-5 stakeholders is hanging in the balance as the expiration of the program draws near. Please join us and the EB-5 Investment Coalition
to help keep EB-5 a viable option for our businesses.
As with all things EB-5, the Devil Lies in The Details…
All proposed additions, whether positive or negative need to be read carefully and groups like IIUSA and the EB-5 Coalition are sharpening their pencils to keep working on communicating the industries ideas to law makers about improving the program.
Before anyone gets too excited about the positive and negatives of the new bill, there will be major changes as all sides work to communicate suggestions and improvements to the content. One thing remains to be the consensus, that a large majority of stakeholders all favor the EB-5 program and its positive impact on the U.S. economy. The program will be protected and extended in some form or another but we need to wait for the details.
Other useful resources regarding EB-5 changes proposed by the new Leahy & Grassley bill: