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What to Expect: Possible Outcomes of EB-5 Reauthorization

Following the EB-5 Regional Center Program’s expiration on June 30, 2021, many interested immigrant investors have spent the past several months exploring other options. After a lengthy wait filled with uncertainty, reauthorization could finally be around the corner. Since Congress is making progress with other issues that held first priority, the Appropriations Bill – which is the bill that EB-5 reauthorization is expected to be attached to – is expected to be addressed in the coming months. This begs the question of what reauthorization could potentially look like?

The Upcoming EB-5 Reform and Integrity Act

Senators Patrick Leahy (D-VT) and Chuck Grassley (R-IA) have recently co-drafted the Reform and Integrity Act which almost passed in June of 2021. At the time this bill was drafted, the minimum investment amount for the Regional Center Program was still $900,000 USD. The policy at the time also included very strict TEA guidelines. Consequently, due to Grassley and Leahy’s endorsement of the investment level and TEA guidelines at the time, their Reform and Integrity Act had no mention of minimum amounts or TEAs. However, the bill did include numerous improvements in investor protection and transparency. This is largely positive news for investors.

“The renewal of the Regional Center Program will be great in terms of enhancements to investor protections and transparency, regardless of how much the minimum amount will increase,” says Roberto Contreras IV, who serves as Managing Director of Houston EB5.

Senator Leahy – who coincidentally is the head of the Appropriations Committee – will have the final say as to what gets included in the Appropriations Bill and has already signaled that he is willing to include his own Reform and Integrity Act. At present, it is widely recognized that both Congress and the USCIS are displeased with the current TEAs and minimum investment amounts. Additionally, key EB-5 Industry lobby groups (IIUSA and EB5IC) are currently in negotiations with Congress about what TEA designations and minimum amounts will eventually be.

Taking into Account the Details of Past Bills

As a clue about what to expect, simply look at the American Job Creation and Investment Promotion Reform Act of 2015, a bill Senators Grassley and Leahy co-authored 6 years ago in an attempt to reauthorize the EB5 program. In that bill, the minimum investment amount was set at $1,000,000 unless the project involved infrastructure or manufacturing in a census tract experiencing high unemployment and/or rates of poverty – if this exception were the case, the project would qualify for a minimum of only $800,000 instead.

“Without a doubt, past and current evidence indicates Congress is most interested in creating jobs in areas that truly need the job creation,” Roberto Contreras IV says.

What Will Be the New Minimum Investment Amount?

In other heavily developed parts of the world, English-speaking countries have higher investment amounts for their immigration programs as well – specifically in Australia ($1.5 million AUD), the United Kingdom ($2 million GBP), and Canada ($1.2 million CAD). Congress is aware of this fact and does not feel like the U.S. should be lower.

“The truth is that the minimum investment amount is going to increase and Targeted Employment Areas are going to get stricter,” warns Roberto Contreras IV.

Despite the overwhelming evidence, many Regional Centers are telling clients to wait for reauthorization in an attempt to get them to hold off so they will invest in their projects instead of other current opportunities. The worst part for many clients is that if they do in fact choose to wait, the very projects they have been waiting for may not even qualify as Target Employment Areas in the future. This could lead to an investor passing up a minimum $500,000 Direct Investment project in a Target Employment Area today in favor of a Regional Center project that will later require up to $1,800,000 million all because a Regional Center sold the investor on wishful thinking.

It would be very misleading for any industry professional to say that Target Employment Areas and/or minimum investment amounts will go unchanged when the program is reauthorized, especially since the entire industry is strongly anticipating change.

One important detail to note is that Houston EB5 is a functioning Regional Center in addition to offering Direct EB-5 investments. There is no bias on the part of Houston EB5’s Investment Relations Managers other than finding the right solution for each individual client’s immigration dreams.

At the end of the day, if you are willing and able to invest $900,000-1,800,000 USD, then it is generally okay to wait for the Regional Center Program to come back. Oppositely, if you are unable or unwilling to make such an investment, then now is the best time to make an investment via a Direct EB5 project.

Immigrate Through a Safe, Secure EB-5 Investment in a Thriving Business

With each new location opened by Moderno Porcelain Works, an average of 60 total jobs in a TEA are created. Since each location is pooling 4 investors, the USCIS minimum of 10 new U.S. jobs is met with a buffer to boot. Houston EB5 has now successfully allocated over 40 investors in 14 Moderno facilities including Houston, Dallas, Austin (San Marcos), Miami, Orlando, Los Angeles, San Diego, Sacramento, Denver, Atlanta, Phoenix Tampa Bay, Minneapolis, and Nashville.

At the moment, investment spots are quickly being filled for the following new Moderno locations:

  • Nashville
  • Chicago, IL
  • Albuquerque, NM
  • Orange County, CA
  • Las Vegas, NV

If you’re looking to immigrate to the U.S. through a safe, secure EB-5 investment by going the direct route, schedule a confidential, no-obligation meeting to review your options. The committed team at Houston EB5 is ready to assist you and your family next!