The EB-5 Visa program is a popular program that allows foreign investors a green card for making a $500,000 minimum investment in projects that bring jobs to the U.S. The law is up for renewal in Washington in September of 2015.
While this is typically a perfunctory subject, as the program has bipartisan support, this year there is a push for substantial EB-5 changes. The lawmakers behind the proposed changes are Senators Chuck Grassley, an Iowa Republican and Vermont Democrat, Patrick Leahy.
Both senators believe the project has gotten away from its original intention of bringing jobs to poorer, rural regions, and seek to increase oversight in an effort to reduce the potential for fraud. Another major change proposed under the bill is increasing the minimum investment from its current $500,000 to $800,000.
Part of the reason the program has received such widespread support in both houses is that is has, within the last three years, created at least 103,000 jobs in 25 states and territories.
The senators proposing the changes argue that some states are circumventing the requirement through tricky maneuvering, like creating targeted employment areas by stitching together multiple census tracts in order to generate areas of higher unemployment rates so they can qualify. This is how these funds are flowing into cities like Manhattan rather than the poorer rural areas it was intended for.
Stricter oversite would curtail some of the creative zoning and help direct more funds to the areas where it would be most beneficial to the communities. The trouble is, these rural areas are often less attractive to the investors.
The consensus is that the program will be renewed. The doubt remains on whether the proposed EB-5 changes will take place.
If you’re a foreign investor interested in taking advantage of EB-5 benefits, it’s important to work with a highly skilled and qualified EB-5 attorney who can walk you through the process as it is now or be ready to help you navigate any changes that may come along as a result of the proposed legislation. David Hirson and Partners, LLP can help you navigate the tricky maneuverings required for your EB-5 investment dollars.