The EB-5 Reform and Integrity Act of 2022 brought many changes to the EB-5 program. For the latest information, please click here.
The following provides my perspective on the state of the EB-5 program based upon what we have seen in the first quarter of 2013.
For prospective regional centers, the first quarter of 2013 has been more productive than the entirety of 2012. This was both predicted and predictable. For pending regional center applications, 2012 was almost a total void. From February 2012, when USCIS announced that it was reevaluating all tenant occupancy cases, to the end of December 2012, when USCIS issued its final tenant occupancy policy, virtually all applications remained in limbo. Applications pending 4 to 6 months as of February 2012 were pending 14 to 16 months by the time the calendar turned to the new year.
However, since the start of the new year, the pace of I-924 adjudications has hastened. We have received 3 new regional center approvals just within the last 3 weeks. We have received 2 exemplar I-526 approvals in the last month.
The bad news is that there are still many I-924s pending for more than a year. We hope to see the number of approvals increasing significantly as these backlogged cases are adjudicated.
It is still too early to analyze how USCIS is implementing its December 2012 tenant occupancy memorandum. Many, if not most, of the RFEs that were responded to in 2012 relating to tenant occupancy issues still remain pending as we begin the second quarter of 2013.
While I-924 adjudications have increased, I-526 adjudications for investors in regional centers have gone in the opposite direction. The processing times have gone from 6 months to 8 months to 10 months to now, in many cases, 12 months. It is difficult to say if this is a “robbing Peter to pay Paul” phenomenon (increasing resources on I-924 applications at the expense of I-526 applications), a result of the SEC investigation in Chicago and SEC reviews of many investment projects on the market or some other reason. Certainly it is true that, with the indefinite delays in new regional center applications in 2012, far more projects were marketed through existing, “adopted” regional centers, meaning that the projects have never been reviewed by USCIS when adjudicators receive the I-526 petitions from the investors.
From our experience, it appears that USCIS will take the longest period of time to adjudicate the first investors in a project. Once a number of investors have been approved (which means that USCIS has evaluated the investment project on multiple occasions), remaining I-526 petitions generally go to the same group of examiners and generally receive much faster processing. However, for speed of processing times, it appears that direct EB-5s are presently the quickest.
Finally, there is the backdrop of the impending move of the EB-5 unit to Washington. Presumably, there is substantial pressure to eliminate a significant portion of the backlog before the files are transferred to a new unit. There is also the impact of the recent appointment of Dan Renaud as the Acting Chief of the Immigrant Investor Program. Mr. Renaud has an exemplary background in overseeing efficient petition processing in other areas of USCIS, and we hope he will bring those same talents to EB-5.
We hope that some of the favorable trends that we have seen in the first quarter of 2013 will continue in the second quarter and that some of the lingering problems will be resolved in a manner that bodes well for the success of the EB-5 program.
