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The EB-5 Visa program was started in 1991. In 1991, the Investor for an EB-5 Visa was required to make an investment of a minimum:
1. $1,000,000
2. $500,000 (in a targeted unemployment area)
The investment required the creation of 10 jobs.
For the first two years the program was only set up for those who were willing to invest and create their own business that would produce at least ten jobs. However, in 1993, the government began to designate certain businesses as regional centers. Original businesses that existed in an area where the unemployment rate exceeds the national average by 150% or the rural population is less than 20,000 fit within the regional center designation and were then eligible to be duly approved by the CIS (formerly the INS).
Between 1993 and 1998 several companies were designated as regional centers. These companies all competed for foreign capital from the foreign investors involved in the EB-5 Visa program. The competition that existed for the foreign capital and the newness of the EB-5 Visa program led to abuses of the system. Most of the
companies didn't offer sound investments and were really in business to collect fees rather than to fund an ongoing business. Many investment opportunities didn't raise the full $500,000 investment capital or hire the required number of employees.
CIS rightly wanted to stop these abuses of the program. In 1998, CIS wrongly applied their revised rules retroactively to people who already had approved petitions. CIS attempted to revoke these visa petitions. This started the litigation. The litigation that ensued put the program on hold from 1999-2002.
In 2002, Congress passed a new law to protect the pre-1998 investors. Also, in 2002, in a case commonly known as "Chang" the 9th Circuit Court of Appeals ruled that CIS may not apply their new rules retroactively. In August of 2003, CIS began approving regional center and EB-5 Visa petitions for the first time since 1998.
The EB-5 Visa Program was amended in 2002 by the following statute (Pl 107-273 Sec. 11037 – 2002):
“A regional center shall have jurisdiction over a limited geographic area, which shall be described in the proposal and consistent with the purpose of concentrating pooled investment in defined economic zones. The establishment of a regional center may
be based on general predictions, contained in the proposal, concerning the kinds of commercial enterprises that will receive capital from aliens, the jobs that will be created directly or indirectly as a result of such capital investments, and the other positive economic effects such capital investments will have.''
As of 2002, Investors may invest $500,000 in a regional center (in a targeted unemployment area) without the necessity of creating 10 jobs. For the $500,000 investment, an investor receives a “conditional green card.”
In January 2005, to improve and expedite EB-5 regional center related applications USCIS established an Investor and Regional Center Unit, (“IRCU”). The unit is the sole adjudicative jurisdiction for Regional Center applications pursuant to the Immigrant Investor Pilot Program for purposes of approval, denial and Requests for Evidence
(RFE's). The unit also monitors and follows up on the actions of approved Regional Centers to ensure compliance with the terms, scope, and conditions of their approval/designation relative to their approved business plans and indirect job creation methodologies. Finally, the unit develops and proposes EB-5 program, policy, and regulation changes or improvements to USCIS management.
The CIS is constantly continuing their efforts to expedite and organize the EB-5 program. Up until January 2009, there were three different filing locations for visa and/or regional center petitions. Currently the CIS has established a unit at the California Service Center and utilizes it as the sole location to file for the EB-5 program. This center is comprised of specially-trained adjudicators dedicated to
EB-5 adjudications. By consolidating adjudications at the center, USCIS believes that it will be able to reduce overall processing times and better monitor EB-5 related adjudications.
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