What about EB-5? After temporary extension, reforms still pending

With all the publicity regarding controversial national legislation and rulemaking, we might lose sign of the fact that the EB-5 investor visa program--used three times to bring cheap loans to Atlantic Yards/Pacific Park--has gotten a brief extension without reform.

As the law firm Mintz Levin noted 12/8/17, the most recent continuing resolution passed by Congress to extend current spending levels for two weeks also extended EB-5 with the current minimum investment levels, $500,000 in a so-called Targeted Employment Area, or TEA. Such TEAs, which are defined as rural areas or areas with high unemployment, are routinely gerrymandered.

The firm notes:

It is unlikely that any reform and reauthorization measure would pass as a stand-alone bill, but if consensus is reached on their proposal it could be attached to the next longterm spending bill making action unlikely until sometime in early 2018, but certainly possible by year end depending on how negotiations proceed leading up to December 22 and whether or not we see an omnibus bill.
Should reform and reauthorization not be achieved through legislation we should anticipate action on the regulatory front by April 2018.

The Wall Street Journal's Mansion Global, that same day, reported Controversial Visa Program for Wealthy Gets Reprieve and noted that reform efforts--which I'd call very much partial--"have stalled over whether to direct more development funding to impoverished and rural areas."

As I've written, the job-creation calculations are extremely generous; a leading EB-5 middleman, founder of the U.S. Immigration Fund (which has twice raised money for Atlantic Yards/Pacific Park), has admitted that projects he organizes don't create jobs. That means that the low-interest loans, which immigrant investors are happy to offer in exchange for a green card, enhance developer profits.

Changing minimums and a new program

An 8/28/17 post from the U.S. Immigration Fund noted some options:

One recent EB-5 reform bill was released in late July 2017 by Congressman Fitzpatrick (R-PA). The Fitzpatrick EB-5 bill proposed to continue the EB-5 Regional Center program but increase TEA investments to $800,000 and increase the investment threshold to $1.2 million for all other investments. This solution is similar to proposed legislation tabled in April 2017 – one by Sen. Cornyn (R-TX) to raise TEA investments to $800,000 and non-TEAs to $925,000, and another by Sen. Grassley (R-IA) to raise TEA investments to $800,0000 and maintain non-TEAs unchanged at $1,000,000.

However, it noted that Senators David Perdue (R-GA) and Tom Cotton (R-AR) have proposed changes in immigration--the RAISE Act--would "eliminate the EB-5 program and all other Employment Based immigration categories."

EB-5 is a program for passive investors; the proposed RAISE Act would offer incentives to those who invest at least $1.35 million or $1.8 million and then actively manage a new commercial enterprise.

Even in times when national politics have not been so fraught, few have tried to represent the public interest regarding EB-5.

The White House has been pretty much silent about EB-5, but President Trump's son-in-law and aide Jared Kushner's family company has benefited from EB-5 (and tried to benefit more).