EB-5 Litigation Update Post #8: USCIS reinstates Form I-526 from April 2019 with $500,000 investment amount: Too little too late for some.
Background: Behring Regional Center Vs. Chad Wolf et al.
In November 2019, the EB-5 Immigrant Investor Program experienced regulation changes that would prove to instantly stall the program from being used to invest, create jobs and immigrate. The new regulations included new regulations and increased investor and operating requirements. Most notably, the minimum investment amount increased 80% from $1 million to $1.8 million and the Targeted Employment Area (TEA) investment amount from $500,000 to $900,000. Here at the Behring Regional Center, we filed a lawsuit claiming that these regulation changes were unlawfully promulgated and ultimately needed to be vacated by the courts. In June 2021, Judge Jacqueline Scott Corley ruled in our favor, successfully vacating the “2019 EB-5 modernization rule” and effectively reinstating the old EB-5 investment regulations and requirements.
The Behring EB-5 Lawsuit Win, which vacated the EB-5 Final Rule brought new opportunity back to the EB-5 world, now allowing investors the ability to invest once again at the $500,000 level. Not only did the minimum investment amounts revert back to $1 million and $500,000 (TEA), the old rules brought back the more transparent, workable and reliable state designations of TEAs and roll back the ridiculous procedural requirements that were implemented in 2019. With the now-vacated 2019 modernization rule, USCIS was to certify whether a TEA works or not. This is not objectionable in theory, what was completely objectionable is that you should not expect an answer from USCIS until 2-4 years later after you filed an I-924 petition, or if you feel lucky, an actual Investor I-526 petition.
The long and hard-fought effort by Behring was eventually rewarded with the court’s decision on June 22, 2021. However, as is equally ironic and almost typical of the EB-5 industry, the very EB-5 Regional Center Program Behring fought to protect expired in Congress on June 30th and discussions for reauthorization are still ongoing. Would be EB-5 investors were offered a whole 7 days to make life-altering decisions. Nonetheless, many investors chose to brave the opaque path forward and see if EB-5 could work at the now more affordable level. The first thing to do was to find out “Is this real”? Investors asked a few very simple questions to help feel validated that what they had heard about the EB-5 program, the EB-5 lawsuit, and Behring was a reality:
- Why does the website still say $900,000?
- The form I-526 says I need to invest $900,000?
- Other attorneys/regional centers/friends say they are not sure what’s real, how do we know?
Behring Regional Center, our attorneys at Greenberg Traurig and any real professional that can read a legal judgment knew exactly the result and what it meant by vacating the 2019 modernization rule. The old pre-November 2019 regulations were back and it was as if the 2019 modernization rule never happened. Unfortunately, with only 7 days to act, this confusion by USCIS, their slow and inability to respond potentially robbed hundreds of families from securing the opportunity to invest in EB-5 at the only level they could afford, the newly recaptured $500,000 TEA investment. At the Behring Regional Center, we did what we could to walk people through the legal documents, the judgement and provided legal opinions from multiple 3rd party attorney’s who had reviewed the matter in depth. Some families moved forward with an I-526 filing, some did not. We did not blame those that chose to pass because of the ambiguity. There should not be pressured to decide in such a short amount of time but Congress and the 32+ times the EB-5 program has expired or been extended results in exactly that.
On July 7th, we can clearly show that USCIS has finally got caught up with the Behring EB-5 Lawsuit.
USCIS remained silent on the Behring lawsuit’s outcome. Today, USCIS has finally broken their silence.
The USCIS website has been updated:
- On July 7th, 2021, USCIS acknowledged this decision and released guidelines for the EB-5 industry, explaining that the Service will accept filings under the regulations in place before November 2019, including:
- No priority date retention based on an approved Form I-526;
- The required standard minimum investment amount of $1 million and the minimum investment amount for an investment is a Targeted Employment Area (TEA) of $500,000;
- Permitting state designations of high unemployment TEAs; and
- Prior USCIS procedures for the removal of conditions on permanent residency.
The April 2019 Form I-526, has now been reinstated:
- To help enact these changes, USCIS is accepting the as it does not reflect the November 2019 investment amounts and regulations.
If only USCIS had taken 15 min to post these two items the same day the judgment occurred, how much capital would have been invested into job-creating projects? How many jobs would have been created? How many families would have a path to becoming U.S. permanent residents?
Now, the only thing that make any of this feel any better is for Congress to act, act decisively, and reinstate the EB-5 regional center program permanently, and not subject the nation to the confusion, risk, and disappointment that just occurred for those who were paralyzed by USCIS innaction.