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Federal agency not yet ready to deal with EB-5 gerrymandering, as new draft memo still defers to state's mapmaking

A revised draft memo on EB-5 Adjudications Policy, issued today by the United States Citizenship and Immigration Services (USCIS) to further discussion of policy regarding immigrant investors, makes no attempt to deal with issues of gerrymandering the map to help those promoting projects to claim they are in areas of high unemployment.

Gerrymandering is crucial, because areas where unemployment is 150% of the national average qualify as Targeted Employment Areas (TEAs), where the minimum investment--for an immigrant investor who seeks green cards for his/her whole family--is $500,000, rather than $1 million.

That issue came to the fore last month after the New York Times published a front-page article describing the odd maps approved for New York projects and an editorial calling for reforms. (I had written previously about the "Bed-Stuy Boomerang" involving Atlantic Yards.)

In the Times, USCIS Director Alejandro Mayorkas expressed concern whether the spirit of the law is being followed. If he's urging reform, though, his agency apparently will wait until legislative renewal of the regional center program--the investment pools through which immigrants invest--rather than via regulation.

From the draft memo

The document states:
The regulation provides that a state government may designate an area within its boundaries as a targeted employment area based on high unemployment. Before the state may make such a designation, an official of the state must notify USCIS of the agency, board, or other appropriate governmental body of the state that will be delegated the authority to certify that the geographic or political subdivision is a high unemployment area. The state may then send a letter from the authorized body of the state certifying that the geographic or political subdivision of the metropolitan statistical area or of the city or town with a population of 20,000 or more in which the enterprise is principally doing business has been designated a high unemployment area. 8 C.F.R. § 204.6(h)(3)(i).
Pursuant to the regulation, 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. However, 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. 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.
(Emphasis added)

And that deference leads to gerrymandering.

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