According to multiple media sources and independently confirmed, last week U.S. Senator Rand Paul (R-KY) circulated a “Dear Colleague” letter seeking co-sponsors to a process called the Congressional Review Act (CRA) to negate the recently proposed Obama-era EB-5 regulations.
The CRA provides Congress with a 60-day window to seek sufficient support – here, 30 senators – on a Resolution of Disapproval requiring simple majority passage in both bodies, and presidential signature to negate the regulations.
According to EB-5Investors.com, a huge proponent of the EB-5 Program, Sen. Paul is seeking to stop the EB-5 modernization regulation from increasing the EB-5 minimum investment amount in targeted employment areas from $500,000 to $900,000, and the EB-5 minimum investment amount in non-targeted employment areas from $1 million to $1.8 million. He also hopes to stop the regulation from taking away, or at the very least, restricting states’ abilities to designate targeted employment areas, the blog notes.
If the new rule were to go into effect, Sen. Paul said, “…this rule may undermine the very purpose of the program, which is to create jobs and grow the economy.” This is because raising the minimum investment amount could soon make many foreign investors ineligible for the program.
If fewer foreign investors qualify for the EB-5 Program, it could mean less foreign investment in the U.S. This could have a significant impact on the U.S. economy.
The Congress will return from recess in September. We expect intense end-of-year fiscal negotiations that will include extension of the EB-5 program, Sen. Paul’s efforts, and other attempts to provide for more thoughtful legislated reforms.
Please contact your GT attorney with any specific questions, and check back here for updates.