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On March 11, 2022, Congress passed the EB-5 Reform and Integrity Act of 2022 as part of the Consolidated Appropriations Act, reauthorizing the regional center program after it spent nearly a year in limbo. Although the EB-5 program has directly led to the investment of billions of dollars into the American economy and created thousands of jobs, last June Congress was unable to pass legislation extending the authorization of the regional center program and allowed it to lapse. However, the EB-5 Reform Act of 2022 is not a mere band-aid that simply extends authorization of the regional center program, it is a piece of legislation that will ensure the stability of EB-5 for years to come. Here’s a brief overview of the EB-5 Reform and Integrity Act’s positive impacts.
Long Term Authorization
Last year’s lapse in authorization for the regional center program was not the first time the program has faced this issue. For years the regional center program’s authorization has received short-term renewals tied in with Congressional spending bills. While last year was the first extended lapse of authorization in the regional center programs history, securing long term authorization for the program has been a goal of EB-5 reformers for years. The EB-5 Reform and Integrity Act finally addressed this issue and authorized the regional center program through fiscal year 2027.
Processing Existing Investors
When the regional center program’s authorization lapsed last year one of the most pressing questions was what would happen to the backlog of EB-5 investors waiting to receive their visa. USCIS stated that processing of these applications would be placed on hold and resumed after the regional center program was reauthorized. With the passage of the EB-5 reform and integrity act the regional center program will be fully reauthorized by this May and begin processing applications again. Existing EB-5 investors will be glad to know that the EB-5 Reform and Integrity Act makes it clear their applications will be protected and processed.
Protections for Investors
Also included in the EB-5 Reform and Integrity Act are new measures to help protect investors from potential fraud. The bill includes formal requirements for regional centers to comply with existing securities laws. Regional centers will be required to pay a fee to the EB-5 Integrity fund which will fund enforcement of regulations. Although fraud is highly uncommon in the EB-5 program, additional protections for EB-5 investors are always welcome.
Lower Investment Requirements
Lastly, the EB-5 Reform and Integrity Act has lowered the required investment for the regional center program. Previously, regional center investors were required to invest a minimum of $900,000 for projects located in a targeted employment area (TEA), and a minimum of $1.8 million for projects outside of a TEA. The Reform and Integrity Act lowered these requirements to a minimum of $800,000 for TEA projects, and $1,050,000 in projects not in a TEA.
Simply put, the EB-5 Reform and Integrity Act is a huge win for the EB-5 program, securing reforms that proponents of EB-5 have advocated for years. Fill out our quick free evaluation form below and find out if the EB-5 program is right for you.
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