with Nataliya Binshteyn

On March 5, 2013, the Office of the Citizenship and Immigration Services Ombudsman (“USCIS Ombudsman’s Office”) held a meeting for stakeholders of the EB-5 Immigrant Investor Program (“EB-5 program”) to address issues ranging from persistent adjudication delays to the conflict between agency standards and business realities. The gathering, which featured speakers from government and the private sector, emphasized the following key themes for improving the EB-5 program and expanding its reach to stakeholders abroad and in the United States.

Predictability

The lack of reliable adjudication standards and accurate processing times undercuts business development and stymies legal practitioners. It also discourages prospective investors, who are increasingly seeking out similar programs in Australia and Canada because they are easier to navigate and more transparent. For example, current processing times can be as long as 18 months to two years and accurate information about adjudication timelines cannot be obtained.

Requests for Evidence

Stakeholders reported a close to 100% Request for Evidence (RFE) rate for Form I-924, Application for a Regional Center Under the Immigrant Investor Pilot Program, petitions. Many also noted that “unduly burdensome” RFEs often announce new standards for evaluating the merits of such cases, making it impracticable and unnecessarily difficult to prepare a successful petition. Furthermore, approval rates of less than 40% indicate that investors and their counsel are finding it difficult to understand the applicable legal standard and prepare strong petitions.

Communication and Transparency

Stakeholders were universal in their criticism of the USCIS’ EB-5 communication channels, emphasizing the absence of meaningful dialogue, useful email responses, and case status tracking. As noted above, stakeholders often learn agency policies through the issuance of RFEs and no direct telephone or substantive email outlet between petitioners, regional center representatives and adjudicators exists. Furthermore, opaque and unannounced adjudication delays are frustrating, inefficient, and very harmful to often time-sensitive business priorities.

Unsettled Policy and Adjudication Issues

The legal basis for requiring NAICS codes and regional center job creation before the end of the conditional residence period is currently unsettled, contributing to a status quo that some stakeholders call “per se unreasonable.” In addition, key questions about the applicability of tenant occupancy jobs, bridge loans, and multiple economic models to support job creation remain unanswered.

Leadership

Stakeholders voiced concerns about the practical impact of moving EB-5 processing operations from the California Service Center to DC headquarters, noting the likelihood of additional costs and delays during the transition period. In addition, leadership and accountability were among the key issues raised by stakeholders who questioned the USCIS’ “institutional commitment” to the EB-5 program and critiqued the lack of commercially reasonable and objective-driven parameters for guiding its growth in the legal, business and international investor communities.

For up-to-date news and commentary about EB-5 issues, please visit www.eb5insights.com.