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The Department of Homeland Security (DHS) has issued a notice of proposed rulemaking to be published on January 13, 2017 to amend the regulations in relation to the employment-based, fifth preference (EB-5) immigrant investor classification and associated regional centers.  The purpose of the proposed amendments is to modernize the EB-5 program.  DHS will accept comments for 90 days, which must be received on or before April 11, 2017.  The program is currently set to expire on April 28, 2017, after having been given two short-term extensions from its original September 30, 2016 expiration date as part of the Continuing Resolution.

The notice of proposed rulemaking (NPRM) proposes a number of amendments that would greatly change the EB-5 program.  A summary of the major provisions are provided below:

Increases to the Investment Amounts – Increasing the Minimum Investment Amount 

– Increasing the Minimum Investment Amount for High Employment Areas from $1 million to $1.8 million

– Increasing the Minimum Investment Amount for TEAs from $500,000 to $1.3million

– Adjust the Minimum Investment Amounts every 5 years

– No mention of grandfathering or transition periods

TEA Designation

– Allows any city or town with high unemployment (150% of the national average) with a population of  more than 20,000 to qualify as a TEA

– Specific Counties within MSAs

– Defines a TEA as a Census Tract (CT) or contiguous CTs in which the New Commercial Enterprise (NCE) is located if there is high unemployment

– Also defines a TEA as a CT where the NCE is located and all other CTs spooled around the NCE CT if there is a weighted average of the unemployment at least 150% of the national average.

– Rural areas qualify as TEAs, but would be redefined to include areas within the outer boundaries of any city or town having a population of 20k or more if in an MSA

– Eliminated the ability of states to designate areas at high-unemployment.  This would all be done at the federal level

– No mention of grandfathering or transition periods

Priority Date Retention – This would allow EB-5 Investors to retain their place in the priority date line, if through no fault of their own, their petition is denied e.g. the RC is terminated, or if business conditions change that would result in an underperforming or failing investment project

Other Technical Changes

– Derivate family members must file their own petitions to remove conditions from their permanent residence in cases where they are not included in a petition to remove conditions filed by the principal investor (except in limited circumstances)

– Allows for flexibility of interview location at the I-829 stage

– Process for issuing permanent resident cards updated to conform to other procedures, i.e. the immigrant investor and derivatives will not need to report to a district office for processing of their permanent resident cards after approval of Form I-829

The NPRM’s stated aim is to reflect statutory changes and to modernize the EB-5 program.    Stakeholders are encouraged to review all materials and prepare to comment.

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Photo of Laura Foote Reiff‡ Laura Foote Reiff‡

Laura Foote Reiff is the Co-Managing Shareholder of the Northern Virginia Office. She also Co-Chairs the firm’s Labor & Employment Practice’s International Employment, Immigration & Workforce Strategies group. Laura focuses her practice on business immigration laws and regulations affecting U.S. and foreign companies,

Laura Foote Reiff is the Co-Managing Shareholder of the Northern Virginia Office. She also Co-Chairs the firm’s Labor & Employment Practice’s International Employment, Immigration & Workforce Strategies group. Laura focuses her practice on business immigration laws and regulations affecting U.S. and foreign companies, as well as related employment compliance and legislative issues.

Laura advises corporations on a variety of compliance-related issues, particularly related to Form I-9 eligibility employment verification matters. Laura has been involved in audits and internal investigations and has successfully minimized monetary exposure as well as civil and criminal liabilities on behalf of her clients. She develops immigration compliance strategies and programs for both small and large companies. Laura performs I-9, H-1B and H-2B compliance inspections during routine internal reviews, while performing due diligence (in the context of a merger, acquisition or sale) or while defending a company against a government investigation.

Laura represents many businesses in creating, managing and using “Regional Centers” that can create indirect jobs toward the 10 new U.S. jobs whose creation can give rise to EB-5 permanent residence for investment. She coordinates this work with attorneys practicing in securities law compliance, with economists identifying “targeted employment areas” and projecting indirect job creation, and with licensed securities brokers coordinating offerings. She also represents individual investors in obtaining conditional permanent residence and in removing conditions from permanent residence.

Laura’s practice also consists of managing business immigration matters and providing immigration counsel to address the visa and work authorization needs of U.S. and global personnel including professionals, managers and executives, treaty investors/ traders, essential workers, persons of extraordinary ability, corporate trainees, and students. She is an immigration policy advocacy expert and works on immigration reform policies.