Summary of the Draft EB-5 Reform Act

by Saul Ewing Arnstein & Lehr LLP

There appears to be significant momentum from the Republican contingent in the Senate and the House to pass an EB-5 reform bill entitled, "The EB5 Immigrant Investor Visa and Regional Center Reform Act" (the "Draft Bill") in a bid to attach the Draft Bill to the Omnibus on or before March 22nd.  As of the date of this blog, the Congressional Staffers tasked with writing the Draft Bill continue to make revisions and clarifications in a hope to garner support from the EB-5 industry. Therefore, the projected changes discussed herein remain subject to change. This author cautions readers to take note of the fluidity attached with the political process surrounding the Draft Bill’s ongoing negotiations.

What is clear is that if the Draft Bill passes in the form last circulated on or around March 10, 2018, it will dramatically change the EB5 program.  

The positive content in the Draft Bill includes:

  • the extension of the EB-5 program until September 30, 2023;
  • removal of any concerns related to retroactive application of the new provisions meaning that those investors who have filed or will file their I-526 petitions prior to the effective date will receive the benefit of the lower investment amount and the TEA status as of the time of filing;
  • the ability to priority process projects that meet set-aside criteria as set forth below; and
  • the ability, in the event of visa availability, to have concurrent filings of the I-526 petition and adjustment of status.

The Draft Bill contemplates a 120-day moratorium where no EB-5 related applications filings (I-526s or I-924s) would be accepted in an effort to allow USCIS to address the backlog of thousands of pending I-526, I-829 and I-924 petitions and to, otherwise, allow certain procedures to be implemented for the Draft Bill’s go-live date.  

Below are some of the highlights of some of the Draft Bill’s proposed changes:

Minimum Investment Amount

Increase the minimum investment from $500,000 to $925,000 for set-aside projects described below, and from $1,000,000 to $1,025,000 for non-set-aside projects.

Priority Urban Investment

Creates a new category of investment entitled “Priority Urban Investment” similar to the New Market Tax Credit Criteria. In order to qualify, a project must meet at least two of the three criteria: 1) unemployment rate of at least 150% of national level 2) poverty rate of at least 20% or 3) median family income that is not more than 80% of the greater of the statewide median family income or MSA median family income. A total of 1,450 visas are anticipated to be allocated to this category.

Rural Set-Aside

This is defined as a city/county, or an area consisting of census tract or adjacent tracts, outside the outer boundary of any city or town having a population of 20,000 or more, outside a MSA, within a county in a MSA having a population density of less than 225 persons per square mile, OR within any census tract greater than 100 square miles in an area and has a population density of fewer than 100 people per square mile. A total of 1,450 visas are anticipated to be allocated to this category.

Set-Aside for Infrastructure Projects

Homeland Security will determine such designations within 120 days, publish rural and priority urban areas or other criteria that will qualify, and the Secretary of Homeland Security will determine infrastructure classifications and will not be bound by any private or government entity on such designations. A total of 200 visas are anticipated to be allocated to this category.

Job Creation

There are anticipated changes from the current requirement of 10 full-time jobs per petitioner to be created as follows:

  • 12 full-time positions for United States employees, or
  • nine full-time positions for United States employees where the investment is made in a capital investment project:

    • physically located entirely in a rural or priority urban investment area,
    • physically located entirely in a U.S. territory,
    • physically located entirely within the geographic boundaries of any military installation that was closed, during the 25-year period immediately preceding the filing of an application for classification as an immigrant investor under this section, based upon a recommendation by the Defense Base Closure and Realignment Commission (“BRAC”), or
    • funded through a small business investment fund or a franchise fund.

Reserved Visas

The Draft Bill reserves 3,100 visas per year for those immigrants who invest in capital investment projects physically located entirely in rural areas (1,450), priority urban investment areas (1,450) and infrastructure projects (200) (as explained above).   

Source of Funds

Consistent with USCIS policy over the last couple years, the EB-5 Petitioner must source funds for both the investment capital and the administrative fees; provide seven years of tax returns both personal and corporate entities; if applicable, disclose any criminal, civil or administrative judgment/proceedings involving the EB-5 Petitioner; and, has been seemingly required under RFEs over the last year, the identity of all persons who transfer capital into the US on behalf of the EB-5 Petitioner.  Most crucially, it appears the EB-5 Petitioner cannot use non-US assets, such as homes, to secure financing to fund the EB-5 investment. This last point will drastically impact the ability of many investors who have, heretofore, been dependent on using home equity to fund their respective EB-5 petitions.

Premium Processing

Permits for the next six years filing of premium processing for rural areas and priority urban investment for a cost of $5,000. This is an interesting concept but one that author wonders is practical.  USCIS is simply not sufficiently staffed to allow for premium processing of these applications.

Concurrent Filing

Permits filing of AOS application if I-526 is filed and priority date is current.


If the I-526 petition has been approved before date of enactment, the EB-5 Petitioner may be able to amend his or her petition to seek redesignation to rural or PUIA or infrastructure, if the application is filed one year from date of enactment.  Immigrant visa priority dates can be retained and the same will not be deemed a material change; and the minimum investment amount will not be affected.  Note, this appears to be a point of contention and could get modified.

Adjustment of the EB-5 investment amount

Every three years based on CPI.  Adjusted amounts will be effective 90 days after publication.

Amendment for a Regional Center designation

The regional center must provide advanced notice of 45 days and the changes must be publicly disclosed through a website maintained by USCIS.

Regional Center Fees

There will be annual fees of $20,000 or $10,000 if the regional center supports less than 20 investors per calendar year.

Investor Filing Fees

$1,000 per each I-526 petition for the government fund and an extra $25,000 fee, with $12,500 paid by the regional center and $12,500 paid by the petitioner.  As a practical matter, it is likely that the investors’ administrative fee will be increased by $12,500 to cover the regional center portion of this fee. Such additional fees will make the program all the more expensive for EB-5 Petitioners.

Site Visits

It is contemplated that there will be even more site visits and audits of regional centers and projects and even investigations outside the US to combat fraud.

EB-5 Integrity Measures

It is contemplated that there will be significantly more stringent reporting and record-keeping requirements; background checks of all persons involved with Project (including JCE, NCE and investors); no foreign government involvement (this point requires some clarifications); annual site visits, the regional center would  need to certify compliance with SEC rules; 5-year record keeping requirements for the regional center; registration of direct and third party promoters with USCIS; certification of disclosure of fees and commissions paid to promoters. Each I-526 petition needs to be filed with the certification. The compliance burden on regional centers will increase dramatically and there will be a significant cost related thereto. The congressional intent appears to preclude foreign national ownership (excepting US residents) of interests or managerial control of regional centers.  

Treatment of Good Faith Investors in failed or troubled projects

Once the I 526 Petition is filed and approved, EB-5 Petitioners will still be allowed to remove conditions, etc. if within 180 days the NCE associates with an approved RC and EB-5 petitioner makes a qualifying investment in a new NCE. The EB-5 Petitioner will be eligible to remove conditions beginning on a date that is 2 years after the date of subsequent investment.

Petition from Qualified Alien Investors

If the investment is made at least 24 months before admission of petitioners to the US, the Petitioner may be granted lawful permanent residency without conditions.


If a subsequent petition needs to be filed and meets all requirements, children will retain age if filed not less than one year after termination of CPR.


USCIS shall not provide preferential treatment to any regional center or project and subjects USCIS the employee violator to fines if such preferential treatment is provided.

The Bill is undergoing many reiterations and a copy shall be made available once same becomes public.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Saul Ewing Arnstein & Lehr LLP | Attorney Advertising

Written by:

Saul Ewing Arnstein & Lehr LLP

Saul Ewing Arnstein & Lehr LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.