Search results for: economy

Business immigration visa quotas have long presented a major hurdle for employers and employees. There is no logic to the quota systems that Congress has in place, and quotas are not accurately connected with economic reality.

It is important for the US economy that Congress takes the necessary steps to update the employment-based visa system and reform the quota issue. Without these changes, employers will continue to struggle to fill jobs in many industries, such as nursing, and other highly skilled positions.

Continue reading the full article, published by Bloomberg Law Jan. 18, 2023.

In announcing the suspension of biometrics fees for EB-5 applicants last week, U.S. Citizenship and Immigration Services issued data about the number of I-526E and I-526 Petitions filed since September 2022. The announcement stated that 980 petitions had been submitted to USCIS since the reauthorization of the EB-5 regional center program, representing approximately $784,000,000 in EB-5 financing and signaling that the program is once again a popular source of financing for commercial real estate projects and a viable path to a green card for individuals wishing to seek residency in the United States.

The EB-5 program is a U.S. immigrant visa program established in 1990 to stimulate the economy and create jobs by encouraging foreign investment in U.S. businesses. The program allows foreign investors to obtain a green card for themselves and their immediate family members by investing in U.S.-based businesses. To qualify for the program, investors must invest into a U.S. business that will create or preserve at least 10 full-time jobs for U.S. workers. The investment amount is $1,050,000 or $800,000 if the business is located in a rural or high unemployment area known as a “TEA” (targeted employment area), or if the EB-5 project is an infrastructure project sponsored by a governmental entity. The program is popular because it is one of the few paths to U.S. permanent residency that allows self-sponsorship. As many European Golden Visa programs close their doors to new applicants, U.S. green card applications are surging.

The majority of EB-5 investments are made into real estate projects, which can range from commercial properties to residential developments. Real estate developers often use EB-5 financing to fund a portion of their project costs, with the remaining capital typically raised through traditional financing methods such as bank loans, private equity, and mezzanine financing.

EB-5 financing gained popularity as a low-cost source of capital for real estate developers. The interest rate on EB-5 financing is typically lower than other financing options, such as mezzanine financing, making it an attractive option for developers looking to reduce their borrowing costs.

EB-5 financing also offers longer repayment terms than traditional financing options, with terms ranging from five to seven years. This longer repayment period allows developers to defer repayment until the project is completed and generating revenue, reducing the pressure on cash flow during the construction phase. Moreover, EB-5 financing is a flexible financing option that can be structured to meet the needs of individual projects. Developers can customize the terms of the financing, including the interest rate, repayment terms, and collateral requirements, to suit their specific project requirements.

The EB-5 program was suspended for a portion of 2021-2022 while Congress worked out Program improvements and enhancements to increase investor confidence and combat fraud. In doing so, they also created new priority project categories to attract investments from nationals of countries such as China and India. The creation of the priority categories for rural, infrastructure, and TEA projects account for the current heightened interest in the program. If 980 applications are submitted at the lower $800,000 investment threshold, that would represent at least $784,000,000 raised in EB-5 capital in the last six months – but it is possible additional capital was raised. This is a boon to real estate developers looking for capital in a volatile market and amid increasing interest rates.

Want to learn more about EB-5 financing? Join the GT EB-5 team in our New York City office for an informational cocktail event Wednesday, March 29. Email Kate Kalmykov for more information.

On Nov. 2, former U.S. Ambassador to Portugal and Greenberg Traurig Senior Counsel Robert Sherman hosted Francisco Duarte Lopes, the current Portuguese Ambassador to the United States, at the firm’s Boston office. The meeting was attended by Kate Kalmykov, Co-Chair of the Immigration & Compliance Practice, members of the GT Boston office, and business leaders working in various sectors of the Portuguese economy including biotech, life sciences, technology, tourism, and education.

GT Immigration & Compliance attorneys represent investors from the United States and other countries seeking to participate in Portugal’s Golden Visa program, giving applicants the opportunity to obtain Portuguese permanent residency and, eventually, an EU passport. GT attorneys also provide tax counseling, estate planning, and strategic consultative advice, and they represent both individual and corporate clients interested in investing and developing business opportunities in Portugal.

Robert Sherman, Francisco Duarte Lopes, and Kate Kalmykov.
Robert Sherman, Francisco Duarte Lopes, and Kate Kalmykov.

Over the last four years the U.S. immigration policy has been through many drastic changes. The Trump Administration from the beginning promised significant reforms with an overarching theme of one its seminal Executive Orders of 2017 – Buy American Hire American.

Business immigration practitioners and employers that rely on their guidance have experienced significant upheavals in the way non-immigrant and immigrant visa processes are administered. There has been a sea of changes driven by proposed legislation to focus on Merit-Based Immigration to Executive Actions rolling back current programs and policies to protect the U.S. economy and U.S. workers, especially during a pandemic.

What would a new Administration led by Joe Biden and Kamala Harris do to change the current state of play?

Experience with the Obama/Biden Administration and a review of the stated immigration plans of the Biden/Harris campaign indicate that we might see the following:

Executive Actions

  • Reversal of Travel Ban Proclamations banning entry from those present in the Schengen area, U.K., Ireland, Brazil, Iran, and China
  • Reversal of the Ban on the Issuance of Immigrant Visas and Non-immigrant L-1 and H-1 Visas
  • Reversal of the Ban on Certain Students from China
  • Reinstatement of the DACA Program
  • New TPS Designations
  • Review of Interim Final and Proposed Rules impacting the H-1B and PERM programs
  • Withdrawal of Guidance Memorandums on Respecting Precedent in Adjudication of USCIS cases
  • Review of F-1 and J-1 proposed rules on Duration of Status
  • Additional Funding for USCIS/DOL/DHS
  • EB-5 Reform – Nullifying the EB-5 Rule and pushing for legislative reform
  • Withdrawal of Public Charge Attestations from those seeking certain Immigration Benefits

Litigation

  • In-depth review of current cases challenging immigration rules and the position of DHS/USCIS/DOJ

Legislation

  • Attempts to Pass HR 6 providing relief to DACA and TPS beneficiaries
  • A push to pass the Elimination of Per Country Quotas – The Fairness in High Skilled Immigration Act
  • Comprehensive Immigration Reform to include Reform of the NIV and IV Systems
  • EB-5 Reform – Nullifying the EB-5 Rule and pushing for legislative reform

While Inauguration Day isn’t until Jan. 20, 2021, and there is a lot to be sorted out between now and then, it is safe to say that a Biden Harris Administration would handle business immigration policy in a dramatically different way.

On Nov. 26, 2019, a complaint for Injunctive Relief and a Temporary Restraining Order was filed by Florida EB-5 Investments, LLC against the Department of Homeland Security (DHS) challenging a Nov. 21, 2019, DHS-issued final rule amending its regulations for the EB-5 program to purportedly modernize the rules (EB–5 Immigrant Investor Program Modernization, 84 Fed. Reg. 35750 (July 24, 2019). Case 1:19-cv-03573 FLORIDA EB5 INVESTMENTS, LLC v. WOLF et al.

The Rule proposed many changes to the EB-5 Program, including: (i) significant increases in the requisite investment levels; and (ii) a new targeted employment area (TEA) designation process that eliminates the input of the individual states in designating such areas in which investments are made. The complaint alleges statutory and constitutional grounds to challenge the rule, claiming that it violates the Administrative Procedures Act (APA), exceeds DHS’s authority, and violates the Tenth Amendment, among others. The complaint further alleges that the Rule’s changes impact the U.S. economy and were proposed without adequate studies or analysis.

For more on EB-5 modernization, click here.

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.

For more on EB-5 modernization, click here.

 

On June 4, 2019, the Kenan Institute released a timely policy brief, “Immigrant Entrepreneurship: An American Success Story,” on the value of highly skilled and motivated foreign entrepreneurs to the U.S. economy. The brief states, “When looking at the founding of the United States’ largest startups…[t]he immigrant-founded startups employ an average of more than 1,200 workers each, and have collective values of $248 billion.”

This brief follows a March 2019 comprehensive analysis of the EB-5 immigrant investor programs for fiscal years 2014 and 2015. According to the March release,

The study, prepared by Economic & Policy Resources, Inc. (EPR), estimated the economic benefits and job creation contributions of all EB-5 regional center projects that were active in federal fiscal years 2014 and 2015 using the most geographically robust methodology employed to date and a comprehensive EB-5 regional center project activity data set supplied by IIUSA. The study also showed that the regional center program contributed more than $23 billion in labor income to the U.S. economy and resulted in nearly $55 billion—or 3 percent—added to U.S. economic output.

‘Economic activity and job creation effects of this scale represent a call to the EB-5 industry and legislative policymakers to take action,’ said Jeffrey Carr, one of the report’s co-authors and President of EPR. ‘Absent that action, the economic contributions quantified in this study will merely represent “lost opportunity” for the U.S. economy. Tens of billions of future foreign investment dollars and hundreds of thousands of new U.S. job opportunities hang in the balance.’ Robert Chase, Senior Economist at EPR, was the report’s other co-author.

The Kenan Institute brief concludes by encouraging U.S. policies, such as EB-5, to attract global entrepreneurs:

Despite the empirical evidence that high-skilled immigrants contribute significant value to the U.S. economy, major hurdles exist for them to obtain visas that allow for starting new ventures. In the current era of global talent competition, we suggest that there are specific policies that the United States can implement to lower barriers for immigrant entrepreneurs, benefit from high-skilled immigrants and foster associated entrepreneurial economic growth.

For more on EB-5 and job creation, click here.

For more on EB-5 and the economy, click here.

On March 14, 2019, the EB-5 Investment Coalition, in cooperation with Invest in the USA (IIUSA), released the most comprehensive economic analysis of the EB-5 program to date. Laura Reiff, co-chair of Greenberg Traurig’s Immigration & Compliance Practice, commented on the report: “Without the typical data limitations and constraints on economic analysis, premier industry economists measured and determinized the billions of dollars in economic activity created by EB-5.  At a time of needed reauthorization and legislated reforms, we hope to present this data to the Administration and Congress to help make sound economic-based reforms to this vital economic engine and job-creating EB-5 program.”

For more on EB-5 and job creation, click here.

For more on EB-5 and the economy, click here.

˘ Not admitted to the practice of law

On Aug. 24, 2018, U.S. Citizenship and Immigration Services (USCIS) made a significant update to its Policy Manual, Part G: Immigrant Investors. In its Policy Alert, USCIS outlined the changes to the Policy Manual. Notable among the updates was the following:

Policy Highlight 5

Explains that USCIS considers a change in regional center affiliation a material change in cases where the change takes place after Form I-526 has been filed.

This is the first time USCIS has stated in writing that such a change in regional center sponsorship is considered a “material change.”  The impact on investors and projects could be significant:  a material change post I-526 Petition filing but before the investor is granted conditional permanent residence requires the filing of a new I-526 Petition.  For the following reasons, investors must carefully consider the potential consequences of this change:

  1. If an investor is subject to a visa backlog, the priority date (the date the I-526 Petition is received at USCIS) is critical to determining the length of time an investor will wait to achieve permanent residence.  For investors born in Mainland China and Vietnam, which are currently subject to visa backlogs, it can significantly increase the wait time if a new I-526 Petition is required.
  2. If an investor must refile his or her I-526 Petition, and he or she has a child that has reached the age of 21, that child can no longer immigrate with the family.
  3. Even if the investor is not subject to a visa backlog, it could significantly increase the wait time to come to the U.S. as a conditional permanent resident.
  4. If the regional center sponsoring the project has its designation terminated by USCIS, the investors may be innocent bystanders who may nonetheless be penalized by USCIS for failures on the part of the regional center.

The regulations at 8 CFR 204.5(j) require an immigrant investor to establish the following facts for I-526 petition approval:

  1. A new commercial enterprise has been established by the petitioner in the United States;
  2. Petitioner has placed the required amount of capital at risk for the purpose of generating a return on the capital placed at risk;
  3. Petitioner has invested, or is actively in the process of investing, capital obtained through lawful means;
  4. The new commercial enterprise will create not fewer than ten (10) full-time positions for qualifying employees.  To show that the new commercial enterprise located within a regional center approved for participation in the Immigrant Investor Pilot Program meets the statutory employment creation requirement, the petition must be accompanied by evidence that the investment will create full-time positions for not fewer than 10 persons either directly or indirectly through revenues generated from increased exports resulting from the Pilot Program. Such evidence may be demonstrated by reasonable methodologies including those set forth in paragraph (m)(3) of [Section 204.6]; and
  5. The petitioner will be engaged in the management of the new commercial enterprise, either through the exercise of day-to-day managerial control or through policy formulation.

Sponsorship of one regional center or another does not affect the approvability of a petition under 8 CFR 204.5(j)(1), (3), and (5).  Generally, the location of the new commercial enterprise (NCE) is not material to the adjudication of the I-526 petition in the case of regional center sponsorship, as the job creating entity (the JCE) and EB-5 project itself must be located within the boundaries of a regional center.  The only exception to this is if the NCE and the JCE are the same entity, in which case the NCE must be located within the boundaries of an approved regional center.  Assuming that the same NCE is legally in existence in the United States, the petitioner has invested capital obtained through lawful means, and the petitioner is engaged in the management of the NCE, then he or she meets the requirements of the regulations at 8 CFR 204.5(j)(1), (3), and (5), irrespective of which regional center is sponsoring the NCE.

The investor also must show that he or she has placed the required amount of capital at risk for the purpose of generating a return.  Matter of Izummi requires that if the NCE is a holding company, the full requisite amount of capital must be made available to the business(es) (i.e., JCE) most closely responsible for creating the employment on which the petition is based to meet the “at risk” capital investment requirement.  If the JCE is located within the boundary of a regional center approved by USCIS, then the immigrant investor meets the requirement of 8 CFR 204.5(j)(2) pursuant to Matter of Izummi.  If a new regional center, previously designated by USCIS and in good standing, becomes the new sponsor of an NCE, and the project is located within its approved geographic area, such a change cannot be considered to naturally affect the decision, and thus, cannot be found material to the adjudication.

Finally, under 8 CFR 204.5(j)(4), the investor also must show that the investment will create full-time positions for not fewer than 10 persons either directly or indirectly through revenues generated from increased exports resulting from the Pilot Program.  If a new regional center sponsors an NCE and that new regional center was designated previously by USCIS to cover the geographic area of the JCE and the project, then petitioner meets the standard outlined in Matter of Izummi, which requires the JCE to be located within the boundaries of a regional center.

Importantly, nothing in the regulations or the Policy Manual require all job creation to exist within the boundaries of the regional center, and this is established USCIS policy.  The statute states that visas shall be made available to qualified immigrants seeking to enter the U.S. for the purpose of engaging in a new commercial enterprise “which will benefit the United States economy and create full-time employment for not fewer than 10 U.S. citizens or aliens lawfully admitted permanent residents…” 8 USC §1153(b)(5)(A)(ii). Moreover, 8 CFR §204.6(j)(4)(iii) states that an NCE located within a regional center can show that it meets the statutory employment creation requirement by including evidence that the “investment will create full-time positions for not fewer than 10 persons either directly or indirectly through revenues generated from increased exports resulting from the pilot program.” Nothing in this regulation limits the job creation to the bounds of the regional center, so the boundaries of the regional center are not necessarily material to the adjudication of the petition under the instant regulation.  This is repeated in the Policy Manual, which states that “[i]ndirect jobs can qualify and be counted as jobs attributable to a new commercial enterprise associated with a regional center, based on reasonable methodologies, even if the jobs are located outside of the geographic boundaries of a regional center.”

Moreover, nothing in the regulations or the Policy Manual require that the modeled geographic area be exactly the same as the designated area of the sponsoring regional center; instead, USCIS reviews the economic methodology on a standard outlined in the Policy Manual.  Assuming the location of the project has not changed, and the project is located within the previously-approved boundaries of the new regional center, then USCIS must simply determine whether the economic model uses an area with a reasonable demographic structure, the area’s contribution to supply chains of the project, and the connectivity with respect to socioeconomic variables in the area.  Slight changes in regional center boundaries do not necessarily affect the adjudication of the petition.  To the contrary, USCIS must review the geographic area of the impact study separately from the geographic boundaries of the regional center pursuant to its own guidance using demographics, supply chains, and socioeconomic variables.  Therefore, a change in regional center where the new regional center’s geographic area covers the area of the JCE and project cannot be considered to naturally affect the decision, and thus, cannot be found material to the adjudication.

Should a new regional center sponsor an NCE, and the JCE and the project are located within the boundaries of the new regional center, then the eligibility criteria are not impacted for I-526 Petition approval.

A case-by-case analysis of the facts to determine whether a material change has occurred is more pragmatic and fair to EB-5 petitioners, NCEs, JCEs, and regional centers alike.

USCIS updated the Policy Manual previously to state that termination of a regional center following the issuance of conditional permanent residence is not fatal to an I-829 Petition, and that investors can continue to rely on indirect job creation.  Therefore, investors who have entered the United States on the two-year green card, and thereafter the regional center is terminated by USCIS, may still be able to rely on indirect job creation for I-829 Petition approval.

A business coalition and many of its members continues to work for passage of a permanent bipartisan legislation solution for Dreamers living, working, and contributing to our economy.   https://www.coalitionfortheamericandream.us/. More than 100 CEOs of businesses from across the industry spectrum and across the United States are represented in this effort.

The economics of DACA to the U.S. economy have been well-documented, most recently by the American Action Forum. The findings are below:

  • New AAF research finds that DACA recipients contribute, on net, roughly $3.4 billion annually to the federal balance sheet.
  • Previous AAF research found that DACA recipients currently contribute nearly $42 billion to the annual U.S. GDP, with an average economic contribution of $109,00 per worker.
  • Previous AAF research further found that physically removing all DACA recipients would cost between $7 billion and $21 billion and reduce U.S. GDP by 0.4 percent.

Read more here.

Business immigration issues are at the forefront of matters before the U.S. Congress. Please contact Laura Reiff and or Bob Maples if your business would like to join DACA advocacy or to discuss any other business immigration/workforce matters of interest.