With the provisions of the EB-5 Regional Center Program due to expire on 30th June, a bipartisan bill is currently working its way through Congress which supports the programs’ long-term reauthorisation and provides new investor protections to assure the programs’ integrity.
The introduction of H.R. 2901 by US Representatives Greg Stanton (D-Arizona) and Brian Fitzpatrick (R-Pennsylvania), supporting the long-term reauthorisation and reform of the EB-5 Regional Center Program was introduced in April as the companion to S.831, introduced in March by US Senators Chuck Grassley (R-Iowa) and Patrick Leahy (D-Vermont).
The bill, as written, would reauthorise the program through to 2026 and provide additional transparency and integrity measures to improve accountability of applicants, Regional Centers, and their economic development projects.
Invest in the USA (IIUSA), the only non-profit trade association for the EB-5 Regional Center Program, welcomed the move. “On behalf of CSCJ, IIUSA, and its leadership, I am pleased to share our unanimous support of the introduction of House companion bill,” said Aaron Grau, Executive Director at IIUSA. Grau continued, “For years, members of Congress and the EB-5 community have agreed that the Regional Center Program needs added integrity reforms to achieve long-term reauthorisation. Time is of the essence to turn this bill into law now and lay the groundwork for more program improvements in the future.”
“I’ve seen firsthand how the EB-5 program can attract foreign investment and create new jobs—lifting our economy and making us more globally competitive,” said Rep. Greg Stanton. “This bipartisan bill – with leadership from our colleagues in the Senate – we are addressing vulnerabilities the EB-5 program faced in the past and including integrity measures so that it functions as Congress intended. The reauthorisation of the EB-5 program is critical to our nation’s economic growth and I look forward to this bill becoming law.”
Rep. Brian Fitzpatrick commented, “As a longtime proponent of the EB-5 Regional Center Program, I’ve seen firsthand how the program has been a powerful tool for our nation’s economic development. This bipartisan reauthorisation represents Congress and the business community coming together to ensure communities across the country can continue to access capital for critical projects while increasing needed oversight and integrity measures to root out fraud and abuse.”
The EB-5 Regional Center Program was created to attract investments from foreign individuals who meet specific capital and job creation requirements. EB-5 investments have filled funding gaps and have provided a vital source of capital for local economic development projects that create and support jobs, infrastructure, and services across the country. Since its inception, the EB-5 Program has drawn in more than $41 billion in capital investment from across the globe to support American businesses and created at least 820,000 job opportunities for US workers.
The program had a challenging year in 2020 due to the COVID-19 pandemic’s disruption of travel and trade and the reduced demand for the EB-5 investment program following the Modernization Rule’s enactment in 2019. In addition, many investors are concerned about their long-pending EB-5 petitions, or whether they’ll be subject to sunset clauses should the program not be renewed.
Most EB-5 industry stakeholders believe EB-5 will be reauthorised in some form after 30th June, but this is not a given, and many commentators also think that it will not be passed without some of the reform proposed in the latest legislation.
If the regional center program were terminated, it is believed that many foreign nationals would seek out similar residency-by-investment programs offered by other highly developed countries, such as Canada, Australia or the UK.
How can I show my support for EB-5?
The Coalition to Save and Create Jobs was established to promote economic recovery, development, and growth by assuring the good-government and long-term reauthorisation of the EB-5 Regional Center Program. CSCJ consists of trade associations, chambers of commerce, municipalities and mayors’ offices, community banks, economic development organisations, healthcare facilities, and more. For more information on how you can support the Coalition to Save and Create Jobs, visit https://www.saveandcreatejobs.org/