February 7th, 2012
U.S. Citizenship and Immigration Services (USCIS) released a draft memorandum to address "certain foundational issues" in the EB-5 immigrant investor program. USCIS seeks stakeholder input on these foundational issues before providing greater detail and addressing additional issues.
On a conference call held on November 9, 2011, to discuss the draft memo, Mr. Mayorkas said that it differs from other policy memos in that it gives adjudicators the context of the EB-5 program: that it is important because it creates jobs for U.S. workers. Mr. Mayorkas said that this context should guide adjudicators. USCIS subsequently released a revised memo on January 11, 2012, and held a related stakeholder meeting the next day.
Among other things, the memo lays out the preponderance of evidence standard: "[T]he petitioner must establish each element by a preponderance of the evidence. That means that the petitioner must prove to us that what he or she claims is more likely so than not so. This is a lower standard of proof than the standard of 'clear and convincing,' and even lower than the standard 'beyond a reasonable doubt' that applies only to criminal cases. The petitioner does not need to remove all doubt from our adjudication, but must instead show that what he or she presents is more probable than not."
In general, the memo will only take effect when USCIS finalizes it. However, effective immediately, USCIS generally will defer to a state's targeted employment area (TEA) designation. The memo notes: "USCIS is to give deference to the state's designation of the physical boundaries of the geographic or political subdivision that will be the targeted employment area." It adds, however, that "USCIS must ensure compliance with the statutory requirement that the proposed area designated by the state in fact has an unemployment rate of at least 150 percent of the national average rate. For this purpose, USCIS will review state determinations of the unemployment rate and, in doing so, USCIS can assess the method or methods by which the state authority obtained the unemployment statistics."
The memo states that acceptable data sources for purposes of calculating unemployment include "Local Area Unemployment Statistics produced by a government agency, U.S. Census Bureau data, and data from the American Community Survey. State unemployment determinations should be based on the most recent publicly available data from the source relied upon."
The memo also clarifies that while the immigrant’s investment must result in the creation of jobs for qualifying employees, it is the new commercial enterprise that creates the jobs. An investor's money that goes into a new commercial enterprise can be used in a variety of ways, including bridge financing, hiring personnel, or operating the company.
USCIS Director Alejandro Mayorkas said the draft memorandum is a "work in progress," and that the agency is sharing it now "to obtain valuable real-time input and to define a collaborative approach with the stakeholder community." He noted that the draft memorandum "is not operative and will not guide adjudication decisions until it is published in complete and final form. Current policy memoranda continue to guide our adjudications." Mr. Mayorkas said that USCIS plans to consolidate all existing EB-5 memos into one. The second draft released on January 11 incorporated comments received from stakeholders.
Initial comments were taken until December 9, 2011. Additional opportunity to comment is available now that the second draft has been released.