USCIS Director Mayorkas issued a draft memorandum and held a stakeholders conference call on November 9, 2011. Although the memorandum is in draft form, it represents the present thinking of USCIS.
It is anticipated that, in the coming months, the memorandum will be finalized after public comment. It will represent a comprehensive statement of USCIS policy on all major EB-5 issues. The EB-5 Committee of the American Immigration Lawyers Association, which I Chair, will be active participants in the development of the comprehensive policy memorandum.
For now, there are four important issues to note:
1. Premium Processing
USCIS is targeting spring 2012 for premium processing. (My personal estimate is summer 2012 at the earliest). At least initially, premium processing will be limited to new I-924 regional center designation applications. It will not apply to regional center amendments, separately filed exemplar I-526 project pre-approval applications or investor I-526 petitions.
2. State TEA Designation Letters
USCIS confirms that it will not challenge the state determinations of geographical areas to be designated targeted employment areas. USCIS reserves the right to make certain that the mathematical computations of 150% of the national average unemployment rate are correct. This is a significant development since USCIS, in the last 6 months, had challenged state geographical determinations in at least 5 states.
3. Bridge Financing
USCIS agrees that it is the new commercial enterprise – and not the EB-5 investors – that must create the jobs. This means that, if the project moves forward based on interim financing, and the interim financing is replaced by EB-5 investment money, the jobs created by the new commercial enterprise are qualifying jobs for EB-5 purposes. We believe it is beneficial to document that the bridge financing was made available to the new commercial enterprise based on the understanding it would be replaced by the EB-5 money. Note that this issue was discussed by Director Mayorkas but was not included in the draft memorandum.
4. Material Change
USCIS has denied a number of I-829 conditional removal petitions where there has been a “material change” in the business plan between the I-526 filing and the I-829 filing. This is problematic because it is an economic reality that many business plans change to adapt to economic and other conditions. The draft memorandum significantly recognizes that these changes do occur and that they do not necessarily prevent the investor from having conditions removed as long as the necessary jobs are created. We will be working on clarifying the language of the draft memorandum on this point.
Contact a Klasko Law attorney for further information.