USCIS-2016-0006-0296 - Revised Rule PDF

35750 Federal Register / Vol. 84, No.
142 / Wednesday, July 24, 2019 / Rules and Regulations
DEPARTMENT OF HOMELAND C. EB–5 Immigrant Visa Process G. National Environmental Policy Act
SECURITY D. Final Rule H. Paperwork Reduction Act
III. Response to Public Comments on the
Proposed Rule I. Executive Summary
8 CFR Parts 204 and 216
A. Need for Rulemaking and Regulatory A. Purpose of the Regulatory Action
[CIS No. 2555–14; DHS Docket No. USCIS– Process
2016–0006] B. Priority Date Retention DHS is updating its regulations
1. Proposed Standards for Retaining a governing EB–5 immigrant investors
RIN 1615–AC07 Priority Date and regional centers to reflect statutory
2. Other Comments on Priority Date changes and codify existing policies.
EB–5 Immigrant Investor Program Retention This final rule also changes areas of the
Modernization C. Increases to the Investment Amounts EB–5 program in need of reform.
1. Increase to the Standard Minimum
AGENCY: U.S. Citizenship and Investment Amount B. Legal Authority
Immigration Services, DHS. 2. Use of CPI–U
3. Adjustments Every Five Years Tied to
The Secretary of Homeland Security’s
ACTION: Final rule.
CPI–U authority for this final rule can be found
SUMMARY: This final rule amends 4. Implementation of the Increase in in various provisions of the Immigration
Department of Homeland Security Investment Amount and Nationality Act (INA), 8 U.S.C. 1101
(DHS) regulations governing the 5. Increase to the TEA Minimum et seq., as well as the Departments of
employment-based, fifth preference Investment Amount Commerce, Justice, and State, the
6. Investment Level Differential Between Judiciary, and Related Agencies
(EB–5) immigrant investor classification Standard Investment Amount and TEA
and associated regional centers to reflect Appropriations Act, 1993, Public Law
Investment Amount 102–395, 106 Stat. 1828; the 21st
statutory changes and modernize the D. Revisions to the Targeted Employment
EB–5 program. In general, under the Century Department of Justice
Area (TEA) Designation Process
EB–5 program, individuals are eligible 1. Standards Applicable to the Designation Appropriations Authorization Act,
to apply for lawful permanent residence of a TEA Public Law 107–273, 116 Stat. 1758; and
in the United States if they make the 2. Proposal To Eliminate State Designation the Homeland Security Act of 2002
necessary investment in a commercial of TEAs (HSA), Public Law 107–296, 116 Stat.
enterprise in the United States and 4. Other Comments on Proposal To Change 2135, 6 U.S.C. 101 et seq. General
create or, in certain circumstances,
to Special Designation of High authority for issuing this final rule is
Unemployment Area found in section 103(a) of the INA, 8
preserve 10 full-time jobs for qualified 5. Other Comments on the TEA U.S.C. 1103(a), which authorizes the
United States workers. This rule Designation Process Secretary to administer and enforce the
provides priority date retention to E. Technical Changes
immigration and nationality laws,
certain EB–5 investors, increases the 1. Separate Filings for Derivatives
2. Equity Holders including by establishing such
required minimum investment amounts,
F. Other Comments on the Rule regulations as the Secretary deems
reforms targeted employment area
1. Processing Times necessary to carry out her authority;
designations, and clarifies USCIS
2. Visa Backlogs section 101(b)(1)(F) of the HSA, 6 U.S.C.
procedures for the removal of
3. Timing of the Rule 111(b)(1)(F), which establishes that a
conditions on permanent residence. 4. Material Change primary mission of DHS is to ensure
DHS is issuing this rule to codify 5. Comments Outside the Scope of This that the overall economic security of the
existing policies and change certain Rulemaking United States is not diminished by the
aspects of the EB–5 program in need of G. Public Comments and Responses on Department’s efforts, activities, and
reform. Statutory and Regulatory Requirements
programs aimed at securing the
DATES: This final rule is effective 1. Data, Estimates, and Assumptions Used
(Executive Orders 12866 and 13563) homeland; and section 102 of the HSA,
November 21, 2019. 6 U.S.C. 112, which vests all of the
2. Costs (Executive Orders 12866 and
FOR FURTHER INFORMATION CONTACT: Edie 13563) functions of DHS in the Secretary.
C. Pearson, Policy Branch Chief, 3. Other Impacts (Executive Orders 12866 The aforementioned authorities for
Immigrant Investor Program Office, U.S. and 13563) this final rule include:
Citizenship and Immigration Services, 4. Other Comments on the Regulatory • Section 203(b)(5) of the INA, 8
Department of Homeland Security, 131 Impact Analysis (Executive Orders 12866 U.S.C. 1153(b)(5), which makes visas
M Street NE, 3rd Floor, Washington, DC and 13563) available to immigrants investing in
5. Comment on Unfunded Mandates new commercial enterprises in the
20529; Telephone (202) 357–9350.
Reform Act (UMRA) United States that will benefit the U.S.
SUPPLEMENTARY INFORMATION: IV. Statutory and Regulatory Requirements
A. Executive Orders 12866 (Regulatory
economy and create full-time
Table of Contents employment for not fewer than 10
Planning and Review), 13563 (Improving
I. Executive Summary Regulation and Regulatory Review), and United States workers.
A. Purpose of the Regulatory Action 13771 (Reducing Regulation and • Section 204(a)(1)(H) of the INA, 8
B. Legal Authority Controlling Regulatory Costs) U.S.C. 1154(a)(1)(H), which requires
C. Summary of the Final Rule Provisions B. Small Business Regulatory Enforcement individuals to file petitions with DHS
1. Priority Date Retention Fairness Act of 1996 when seeking classification under
2. Increases to the Investment Amounts C. Regulatory Flexibility Act section 203(b)(5).
3. TEA Designations 1. Industry Classifications/NAICS Codes • Section 216A of the INA, 8 U.S.C.
khammond on DSKBBV9HB2PROD with RULES2
4. Removal of Conditions To Classify Regional Centers 1186b, which places conditions on

5. Miscellaneous Changes 2. Industry Classifications/NAICS Codes
permanent residence obtained under
D. Summary of Costs and Benefits To Classify NCEs
E. Effective Date 3. Sources of Revenue for RCs and NCEs section 203(b)(5) and authorizes the
F. Implementation 4. Other Comments on the RFA Secretary to remove such conditions for
II. Background D. Unfunded Mandates Reform Act of 1995 immigrant investors who have met the
A. The EB–5 Program E. Executive Order 13132 applicable investment requirements,
B. The Regional Center Program F. Executive Order 12988 sustained such investment, and
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Federal Register / Vol. 84, No. 142 / Wednesday, July 24, 2019 / Rules and Regulations 35751
otherwise conformed to the rather than being based on rounded see 8 CFR 204.6(d) and acknowledged in
requirements of sections 203(b)(5) and figures. the NPRM preamble, see 82 FR 4738,
216A. • The rule modifies the original 4739 n. 1 (‘‘An EB–5 immigrant
• Section 610 of Public Law 102–395, proposal that any city or town with a petition’s priority date is normally the
8 U.S.C. 1153 note, as amended, which population of 20,000 or more may date on which the petition was properly
created the Immigrant Investor Pilot qualify as a TEA, to provide that only filed. In general, when demand exceeds
Program (the ‘‘Regional Center cities and towns with a population of supply for a particular visa category, an
Program’’), authorizing the designation 20,000 or more outside of metropolitan earlier priority date is more
of regional centers for the promotion of statistical areas (MSAs) may qualify as advantageous than a later one.’’). This
economic growth, and which authorizes a TEA. change is for clarity.
the Secretary to set aside visas • The rule modifies the application of DHS also amends the originally
authorized under section 203(b)(5) of the rule, such that amendments or proposed regulatory text by changing
the INA for individuals who invest in supplements to any offering necessary ‘‘approved EB–5 immigrant petition’’ to
regional centers. to maintain compliance with applicable ‘‘immigrant petition approved for
securities laws based upon the changes classification as an investor, including
C. Summary of the Final Rule Provisions in this rulemaking will not immigrant petitions whose approval
DHS carefully considered the public independently result in denial or was revoked on grounds other than
comments received and this final rule revocation of a petition, provided the those set forth below,’’ and also
adopts, with appropriate changes, the petition meets certain criteria. ‘‘approved petition’’ to ‘‘immigrant
regulatory text proposed in the Notice of • The rule also makes other minor petition approved for classification as
Proposed Rulemaking (NPRM) non-substantive and clarifying changes. an investor.’’ The purpose of these
published in the Federal Register on This final rule makes the following revisions is to clarify that an investor
January 13, 2017. See EB–5 Immigrant major revisions to the EB–5 program may retain a priority date from petitions
Investor Program Modernization; regulations: that had been approved but have since
Proposed Rule, 82 FR 4738. This final 1. Priority Date Retention been revoked on grounds not
rule also relies on all of the specifically excepted in the provision.
The final rule authorizes certain EB–
justifications articulated in the NPRM, DHS further amends the originally
5 petitioners to retain the priority date 1
except as reflected below. proposed regulatory text by changing
of an approved EB–5 immigrant petition
This rule makes the following changes ‘‘based upon that approved petition’’ to
for use in connection with any
as compared to the NPRM: ‘‘using the priority date of the earlier-
subsequent EB–5 immigrant
• The rule clarifies that the priority petition.2 See final 8 CFR 204.6(d).
approved petition.’’ This revision makes
date of a petition for classification as an it clear that once a petitioner uses that
Petitioners with approved immigrant
investor is the date the petition is approved petition’s priority date to
petitions might need to file new
properly filed. obtain conditional permanent residence,
petitions due to circumstances beyond
• The rule clarifies that a petitioner their control (for instance, DHS might
that priority date is no longer available
with multiple approved immigrant for use on any later-filed petition.
have terminated a regional center Last, DHS amends the originally
petitions for classification as an investor associated with the original petition), or
is entitled to the earliest qualifying proposed regulatory text by adding the
might choose to do so for other reasons sentence: ‘‘In the event that the alien is
priority date; (for instance, due to business conditions
• The rule retains the 50 percent the petitioner of multiple immigrant
a petitioner may seek to materially petitions approved for classification as
minimum investment differential change aspects of his or her qualifying
between a targeted employment area an investor, the alien shall be entitled to
investment). This rule generally allows the earliest qualifying priority date.’’
(TEA) and a non-TEA instead of EB–5 petitioners to retain the priority
changing the differential to 25 percent This sentence was added to mirror a
date of a previously approved petition similar sentence at 8 CFR 204.5(e)
as proposed, thereby increasing the to avoid delays on immigrant visa
minimum investment amount in a TEA pertaining to other employment-based
processing associated with loss of a categories, and clarifies which date
from $500,000 to $900,000 (rather than priority date. DHS believes that priority
$1.35 million, as DHS initially applies should an investor have
date retention may become increasingly multiple approved petitions.
proposed); important due to the strong possibility
• The rule makes a technical that the EB–5 category will remain 2. Increases to the Investment Amounts
correction to the inflation adjustment oversubscribed for the foreseeable Pursuant to 8 U.S.C. 1153(b)(5)(C),
formula for the standard minimum future. DHS consulted with the Departments of
investment amount and the high In the final rule, DHS amends the State and Labor 3 to increase the
employment area investment amount, originally proposed regulatory text by minimum investment amounts for all
such that future inflation adjustments defining the term ‘‘priority date’’ to new EB–5 petitioners in this final rule.
will be based on the initial investment mean the date that the petition is See final 8 CFR 204.6(f). The increase
amount set by Congress in 1990, rather properly filed. See final 8 CFR 204.6(d). will ensure that program requirements
than on the most recent inflation DHS inadvertently left this definition reflect the present-day dollar value of
adjustment. Thus, for instance, the next out of the NPRM’s proposed regulatory the investment amounts established by
inflation adjustment will be based on text, see 82 FR 4738, even though this Congress in 1990. Specifically,
the initial minimum investment amount
definition is in the current regulation, consistent with the NPRM, the rule
of $1,000,000 in 1990, rather than this
increases the standard minimum
rule’s minimum investment amount of 1 An EB–5 immigrant petition’s priority date is
investment amount, which also applies
$1,800,000, which is a rounded figure. the date on which the petition was properly filed.
In general, when demand exceeds supply for a to high employment areas, from $1
This change better implements the
particular visa category, an earlier priority date is
intent of the proposed rule; it ensures more advantageous than a later one. 3 DHS includes in the docket for this rulemaking
that future inflation adjustments more 2 This is subject to conditions and limitations a letter from each department detailing the
accurately track inflation since 1990, described in more detail elsewhere in this rule. consultation.
35752 Federal Register / Vol. 84, No. 142 / Wednesday, July 24, 2019 / Rules and Regulations
million to $1.8 million. Final 8 CFR reserved for areas experiencing ‘‘contiguous’’ could be read to include
204.6(f)(1), (3). This change represents sufficiently high levels of census tracts beyond those directly
an adjustment for inflation from 1990 to unemployment, as Congress intended. adjacent to the census tract(s) in which
2015 as measured by the unadjusted DHS is making three changes from the the NCE is principally doing business.
Consumer Price Index for All Urban NPRM, with respect to TEA
designations. First, DHS is modifying its 4. Removal of Conditions
Consumers (CPI–U), an economic
indicator that tracks the prices of goods proposal on high unemployment areas The final rule revises the regulations
and services in the United States.4 This to include only cities and towns with a to clarify that derivative family
rule also makes a technical correction to population of 20,000 or more outside of members must file their own petitions
the inflation adjustment formula, so that MSAs as a specific and separate area to remove conditions on their
future inflation adjustments will be that may qualify as a TEA. See final 8 permanent residence when they are not
based on the initial investment amount CFR 204.6(j)(6)(ii)(A). By contrast, the included in a petition to remove
set by Congress in 1990, rather than on NPRM proposed to allow any city or conditions filed by the principal
the most recent inflation adjustment. town with high unemployment and a investor. See final 8 CFR 216.6(a)(1)(ii).
For investors seeking to invest in a population of 20,000 or more to qualify In addition, the rule improves the
new commercial enterprise that will be as a TEA, regardless of whether located adjudication process for removing
principally doing business in a TEA, the within an MSA. Under the current conditions by providing flexibility in
proposed rule would have decreased the regulatory scheme, TEA designations interview locations and updates the
differential between TEA and non-TEA are not available at the city or town regulation to conform to the current
minimum investment amounts to 25 level, unless a state designates the city process for issuing permanent resident
percent, thereby increasing the TEA or town as a high unemployment area cards. See generally final 8 CFR 216.6.
minimum investment amount to $1.35 and provides evidence of such 5. Miscellaneous Changes
million, which is 75 percent of the designation to a prospective EB–5
investor for submission with the Form The final rule updates the regulations
increased standard minimum
I–526. See proposed 8 CFR to reflect miscellaneous statutory
investment amount. However, based on
204.6(j)(6)(ii)(A). DHS recognizes the changes made since DHS first published
a review of the comments, the final rule
proposal was inadvertently over- the regulation in 1991 and clarifies
will retain the 50 percent differential,
inclusive because DHS intended the definitions of key terms for the
and only increase the minimum
proposal to provide non-rural cities and program.5 By aligning DHS regulations
investment amount from $500,000 to
towns located outside of MSAs with statutory changes and defining key
$900,000. Final 8 CFR 204.6(f)(2). terms, the rule provides greater certainty
In addition, the final rule sets the additional methods to qualify as a TEA,
but the proposal would have allowed regarding the eligibility criteria for
schedule for regular CPI–U-based
cities and towns with high investors and their family members.
adjustments in the standard minimum This final rule will apply to
investment amount, and conforming unemployment and a population of
20,000 or more located within MSAs to petitioners who file on or after the
adjustments to the TEA minimum effective date. To respond to concerns
investment amount, every 5 years, qualify. DHS did not necessarily intend
to permit cities and towns within MSAs regarding the potential effect of this rule
beginning 5 years from the effective date on existing petitioners, DHS has
of these regulations. to qualify or to create any new
distinctions between cities and towns of clarified in the final regulatory text that
3. TEA Designations various populations within MSAs. The DHS will not deny a petition filed prior
final rule modifies the proposal to to this rule’s effective date (or revoke an
Congress authorized DHS to set a
include only cities and towns with a approved petition) based solely on the
different minimum investment amount
population of 20,000 or more outside of fact that the underlying investment
for investments made in TEAs, or
MSAs as a specific and separate area offerings have been amended or
‘‘targeted employment areas’’ (i.e., rural
that may qualify as a TEA based on high supplemented as a result of this
areas and areas of high unemployment).
unemployment. See final 8 CFR rulemaking to maintain compliance
See INA section 203(b)(5)(C)(ii), 8 U.S.C.
204.6(j)(6)(ii)(A). with applicable securities laws. See
1153(b)(5)(C)(ii). The final rule reforms
Second, DHS is finalizing a technical final 8 CFR 204.6(n). This addresses
the TEA designation process to ensure
change to 8 CFR 204.6(i) and (j)(6)(B) by situations in which, for instance, an
consistency in TEA adjudications and
removing the mention of ‘‘geographic investor is actively in the process of
better ensure that TEA designations investing into an ongoing offering and
more closely adhere to congressional and political subdivisions’’ for special
designations. Because DHS proposed filed a Form I–526 petition that is
intent. Specifically, the final rule pending on the effective date of this
eliminates the ability of a state to and is finalizing the census tract process
for special designations, references to final rule, but the documents for the
designate certain geographic and offering need to be modified to ensure
political subdivisions as high other subdivisions are no longer
required. compliance with applicable securities
unemployment areas; instead, DHS will laws because of the increase to the
make such designations directly, using Third, DHS is making an additional
technical change to the description of minimum investment amounts resulting
standards described in more detail from this rulemaking DHS provides
elsewhere in this final rule. See final 8 special designation TEAs at 8 CFR
204.6(i) proposed in the NPRM, further detail on this provision below.
CFR 204.6(i). DHS believes these
replacing ‘‘contiguous’’ as it is used to
changes will help address 5 See final 8 CFR 216.6(a)(4)(i) and (c)(1)(i). DHS
describe additional census tracts that
inconsistencies between and within proposed this specific change to remove references
can be added to the census tract(s) in
states in designating high to the requirement that immigrant entrepreneurs
which the NCE is principally doing establish a new commercial enterprise, because the
unemployment areas, and better ensure
business, with ‘‘directly adjacent.’’ This requirement was removed by the 21st Century
that the reduced investment threshold is Department of Justice Appropriations Authorization
technical change was made to mirror the
Act, Public Law 107–273, 116 Stat. 1758. 82 FR at
4 See Bureau of Labor Statistics, CPI–U Inflation description of special designation TEAs 4751. However, this change was inadvertently left
Calculator, https://www.bls.gov/data/inflation_ elsewhere in the rule and to minimize out of the proposed regulatory text. This final rule
calculator.htm. confusion to the public, as the term reflects the appropriate changes.
D. Summary of Costs and Benefits • Modifies the original proposal that major categories of revisions that
This final rule changes certain aspects any city or town with a population of increase the investment amounts and
of the EB–5 program that are in need of 20,000 or more may qualify as a TEA, reform the TEA designation process.
reform and updates the regulations to to provide that only cities and towns DHS has no way to assess the potential
reflect statutory changes and codify with a population of 20,000 or more reduction in investments either in terms
existing policies. This final rule makes outside of metropolitan statistical areas of past activity or forecasted activity,
five major categories of revisions to the (MSAs) may qualify as a TEA; and cannot therefore quantitatively
existing EB–5 program regulations. • Modifies the application of the rule, estimate any impacts concerning job
Three of these categories, which involve such that amendments or supplements creation, losses or other downstream
(i) Priority date retention; (ii) increasing to any offering necessary to maintain economic impacts driven by these major
the investment amounts; and (iii) compliance with applicable securities provisions. DHS provides a full
reforming the TEA designations, are laws based upon the changes in this qualitative analysis and discussion in
substantive. The two other major rulemaking will not independently
the Executive Orders 12866 and 13563
categories, focused on (iv) the removal result in denial or revocation of a
section of this final rule.
of conditions; and (v) miscellaneous petition, provided the petition meets
changes, involve generally technical certain criteria; There are several costs involved in the
adjustments to the EB–5 program. • Makes a technical correction to the final rule for which DHS has conducted
Details concerning these three major inflation adjustment formula for the quantitative estimates. For the technical
substantive and two major technical standard minimum investment amount revision that clarifies that derivative
categories of changes are provided in and the high employment area family members must file their own
above sections, and in Table 2 in terms investment amount, such that future petitioners to remove conditions on
of benefit-cost considerations. inflation adjustments will be based on their permanent residence when they
Within the five major categories of the initial investment amount set by are not included in the principal
revisions to existing regulations, this Congress in 1990, rather than on the investor’s petition, we estimate costs to
final rule also makes some changes from most recent inflation adjustment; and be approximately $91,023 annually for
the NPRM. Most importantly, the • Makes minor non-substantive and those derivatives. Familiarization costs
reduced investment amount for TEAs clarifying changes. to review the rule are estimated to be
will be raised to $900,000 instead of the DHS analyzed the five major $629,758 annually.
proposed $1.35 million, in order that categories of revisions carefully. EB–5
investment structures are complex, and In addition, DHS has prepared a Final
the 50 percent differential between
investment tiers be maintained. The typically involve multiple layers of Regulatory Flexibility Analysis (FRFA)
other changes between this final rule investment, finance, development, and under the Regulatory Flexibility Act
and the NPRM are not expected to legal business entities. The (RFA) to discuss any potential impacts
create costs and are listed here: interconnectedness and complexity of to small entities. As discussed further in
• Clarifies that the priority date of a such relationships make it very difficult the FRFA, DHS cannot estimate the
petition for classification as an investor to quantify and monetize the costs and exact impact to small entities. DHS,
is the date the petition is properly filed; benefits. Furthermore, since demand for however, does expect some impact to
• Clarifies that a petitioner with EB–5 investments incorporate many regional centers and non-regional center
multiple approved immigrant petitions factors related to international and U.S. projects. As it relates to the FRFA, each
for classification as an investor is specific immigration and business, DHS of 1,570 business entities involved in
entitled to the earliest qualifying cannot predict with accuracy changes in familiarization of the rule would incur
priority date; demand for the program germane to the costs of about $401.
TABLE 2—SUMMARY OF CHANGES AND IMPACT OF THE ADOPTED PROVISIONS
Current policy Adopted change Impact
Priority Date Retention
Current DHS regulations do not permit investors to DHS will allow an EB–5 immigrant petitioner to use Benefits:
use the priority date of an immigrant petition ap- the priority date of an immigrant petition approved • Makes visa allocation more predictable for in-
proved for classification as an investor for a subse- for classification as an investor for a subsequently vestors with less possibility for large fluctua-
quently filed immigrant petition for the same classi- filed immigrant petition for the same classification tions in visa availability dates due to regional
fication. for which the petitioner qualifies, unless DHS re- center termination.
vokes the petition’s approval for fraud or willful • Provides greater certainty and stability regard-
misrepresentation by the petitioner, or revokes the ing the timing of eligibility for investors pur-
petition for a material error. suing permanent residence in the U.S. and
thus lessens the burden of unexpected
changes in the underlying investment.
• Provides more flexibility to investors to con-
tribute to more viable investments, potentially
reducing fraud and improving potential for job
creation.
Costs:
• None anticipated.
TABLE 2—SUMMARY OF CHANGES AND IMPACT OF THE ADOPTED PROVISIONS—Continued

Increases to Investment Amounts
The standard minimum investment amount has been DHS will account for inflation in the investment Benefits:
$1 million since 1990 and has not kept pace with amount since the inception of the program. DHS • Increases in investment amounts are nec-
inflation—losing almost half its real value. will raise the minimum investment amount to $1.8 essary to keep pace with inflation and real
Further, the statute authorizes a reduction in the min- million to account for inflation through 2015, and value of investments;
imum investment amount when such investment is includes a mechanism to automatically adjust the • Raising the investment amounts increases the
made in a TEA by up to 50 percent of the standard minimum investment amount based on the amount invested by each investor and poten-
minimum investment amount. Since 1991, DHS unadjusted CPI–U every 5 years. tially increases the total amount invested
regulations have set the TEA investment threshold DHS will retain the TEA minimum investment amount under this program.
at 50 percent of the minimum investment amount. at 50 percent of the standard amount. The min- • For regional centers, the higher investment
Similarly, DHS has not increased the minimum invest- imum investment amount in a TEA will initially in- amounts per investor will mean that fewer in-
ment amount for investments made in a high em- crease to $900,000. vestors will have to be recruited to pool the
ployment area beyond the standard amount. DHS is not changing the equivalency between the requisite amount of capital for the project, so
standard minimum investment amount and those that searching and matching of investors to
made in high employment areas. As such, DHS projects could be less costly.
will set the minimum investment amounts in high Costs:
employment areas to be $1.8 million, and follow • Some investors may be unable or unwilling to
the same mechanism for future inflationary adjust- invest at the higher levels of investment.
ments. • There may be fewer jobs created if signifi-
cantly fewer investors invest at the higher in-
vestment amounts.
• For regional centers, the higher amounts could
reduce the number of investors in the global
pool and result in fewer investors, thus poten-
tially making the search and matching of in-
vestors to projects more costly.
• Potential reduced numbers of EB–5 investors
could prevent certain projects from moving for-
ward due to lack of requisite capital.
• An increase in the investment amount could
make foreign investor visa programs offered
by other countries more attractive.
TEA Designations
A TEA is defined by statute as a rural area or an area DHS will eliminate state designation of high unem- Benefits:
that has experienced high unemployment (of at ployment areas. DHS also amends the manner in • Rules out TEA configurations that rely on a
least 150 percent of the national average rate). which investors can demonstrate that their invest- large number of census tracts indirectly linked
Currently, investors demonstrate that their investments are in a high unemployment area. to the actual project tract by numerous de-
ments are in a high unemployment area in two (1) DHS will add cities and towns with a popu- grees of separation.
ways: lation of 20,000 or more outside of MSAs as a • Potential to better stimulate job growth in
(1) Providing evidence that the Metropolitan Sta- specific and separate area that may qualify as areas where unemployment rates are the high-
tistical Area (MSA), the specific county within a TEA based on high unemployment. est, consistent with congressional intent.
the MSA, or the county in which a city or town (2) DHS will amend its regulations so that a TEA Costs:
with a population of 20,000 or more is located, may consist of a census tract or contiguous • This TEA provision could cause some projects
in which the new commercial enterprise is prin- census tracts in which the new commercial en- and investments to no longer qualify as being
cipally doing business, has experienced an av- terprise is principally doing business if in high unemployment areas. DHS presents
erage unemployment rate of at least 150 per- • the new commercial enterprise is located the potential number of projects and invest-
cent of the national average rate; or in more than one census tract; and ments that could be affected in Table 5.
(2) submitting a letter from an authorized body of • the weighted average of the unemploy-
the government of the state in which the new ment rate for the tract or tracts is at least
commercial enterprise is located, which cer- 150 percent of the national average.
tifies that the geographic or political subdivision (3) DHS will also amend its regulations so that a
of the metropolitan statistical area or of the city TEA may consist of an area comprising the
or town with a population of 20,000 or more in census tract(s) in which the new commercial
which the enterprise is principally doing busi- enterprise is principally doing business, includ-
ness has been designated a high unemploy- ing any and all adjacent tracts, if the weighted
ment area. average of the unemployment rate for all in-
cluded tracts is at least 150 percent of the na-
tional average.
Current technical issues: DHS will amend its regulations to include the fol- Conditions of Filing:
• The current regulation does not clearly define lowing technical changes: Benefits:
the process by which derivatives may file a • Clarify the filing process for derivatives who • Adds clarity and eliminates confusion for
Form I–829 petition when they are not included are filing a Form I–829 petition separately from the process of derivatives who file sepa-
on the principal’s petition. the immigrant investor. rately from the principal immigrant inves-
• Interviews for Form I–829 petitions are gen- • Provide flexibility in determining the interview tor.
erally scheduled at the location of the new location related to the Form I–829 petition. Costs:
commercial enterprise. • Amend the regulation by which the immigrant • Total cost to applicants filing separately
• The current regulations require an immigrant investor obtains the new permanent resident will be $91,023 annually.
investor and his or her derivatives to report to card after the approval of his or her Form I– Conditions of Interview:
a district office for processing of their perma- 829 petition because DHS captures biometric Benefits:
nent resident cards. data at the time the immigrant investor and • Interviews may be scheduled at the
derivatives appear at an ASC for USCIS office having jurisdiction over ei-
fingerprinting. ther the immigrant investor’s commercial
• Add 8 CFR 204.6(n) to allow certain investors enterprise, the immigrant investor’s resi-
to remain eligible for the EB–5 classification if dence, or the location where the Form I–
a project’s offering is amended or supple- 829 petition is being adjudicated, thus
mented based upon the final rule’s effective- making the interview program more effec-
ness. tive and reducing burdens on the immi-
grant investor.

• Some petitioners will benefit by traveling

shorter distances for interviews and thus
see a cost savings in travel costs and op-
portunity costs of time for travel and inter-
view time.
Costs:
Investors obtaining a permanent resident card:
Benefits:
• Cost and time savings for applicants for
biometrics data.
Costs:
Eligibility Following Changes to Offering:
Benefits:
• An amendment to a project’s offering
based on the final rule’s provisions might
not result in the denial or revocation of a
petition.
Costs:
Miscellaneous Changes
Current miscellaneous items: DHS will amend its regulations to make the following These provisions are technical changes and will have
• 8 CFR 204.6(j)(2)(iii) refers to the former U.S. miscellaneous changes: no impact on investors or the government.
Customs Service. • DHS is updating references at 8 CFR
• Public Law 107–273 eliminated the require- 204.6(j)(2)(iii) from U.S. Customs Service to
ment that alien entrepreneurs establish a new U.S. Customs and Border Protection.
commercial enterprise from both INA section • Removing references to requirements that
203(b)(5) and INA section 216A. alien entrepreneurs establish a new commer-
• 8 CFR 204.6(j)(5) introductory text and (j)(5)(iii) cial enterprise in 8 CFR 216.6.
reference ‘‘management’’; • Removing references to ‘‘management’’ at 8
• Current regulation at 8 CFR 204.6(j)(5) has the CFR 204.6(j)(5) introductory text and (j)(5)(iii);
phrase ‘‘as opposed to maintain a purely pas- • Removing the phrase ‘‘as opposed to maintain
sive role in regard to the investment’’; a purely passive role in regard to the invest-
• Public Law 107–273 allows limited partnerships ment’’ from 8 CFR 204.6(j)(5);
to serve as new commercial enterprises; • Clarifies that any type of entity can serve as a
• Current regulation references the former Asso- new commercial enterprise;
ciate Commissioner for Examinations. • Replacing the reference to the former Asso-
• 8 CFR 204.6(k) requires USCIS to specify in ciate Commission for Examinations with a ref-
its Form I–526 decision whether the new com- erence to the USCIS AAO.
mercial enterprise is principally doing business • Amending 8 CFR 204.6(k) to specify how
in a targeted employment area. USCIS will issue a decision.
• Sections 204.6 and 216.6 use the term ‘‘entre- • Revising sections 8 CFR 204.6 and 216.6 to
preneur’’ and ‘‘deportation.’’ These sections use the term ‘‘investor’’ instead of ‘‘entre-
also refer to Forms I–526 and I–829. preneur’’ and to use the term ‘‘removal’’ in-
• 8 CFR 204.6(i) and (j)(6)(ii)(B) use the phrase stead of ‘‘deportation.’’
‘‘geographic or political subdivision’’ in describ- • Removing references to ‘‘geographic or polit-
ing state designations of high unemployment ical subdivision’’ in 8 CFR 204.6(i) and
areas for TEA purposes. (j)(6)(ii)(B).
• The priority date of a petition for classification • Providing clarification in 8 CFR 204.6(d) that
as an investor is the date the petition is prop- the petitioner of multiple immigrant petitions
erly filed. approved for classification as an investor gen-
erally is entitled to the earliest qualifying pri-
ority date.
In addition to the above, applicants will need to read and review the rule to become familiar with the final rule provisions. Familiarization costs to read and review
the rule are estimated at $629,758 annually.
E. Effective Date F. Implementation II. Background

This final rule will be effective on The changes in this rule will apply to A. The EB–5 Program
November 21, 2019, 120 days from the all Immigrant Petition by Alien Investor As part of the Immigration Act of
date of publication in the Federal (Form I–526) petitions filed on or after 1990, Public Law 101–649, 104 Stat.
Register. DHS has determined that this the effective date of the final rule. Form 4978, Congress established the EB–5
120-day period is reasonable to ensure I–526 petitions filed prior to the immigrant visa classification to
that EB–5 petitioners and the EB–5 effective date of the rule will be allowed incentivize employment creation in the
market have time to adjust their plans to demonstrate eligibility based on the United States. As enacted by Congress,
to the changes made under this rule. regulatory requirements in place at the the EB–5 program makes lawful
DHS believes it will be able to time of filing of the petition. DHS has permanent resident (LPR) status
implement this rule in a manner that determined that this manner of available to foreign nationals who invest
will balance the equities of stakeholders implementation best balances at least $1 million in a new commercial
and avoid delays of processing these operational considerations with fairness enterprise (NCE) that will create at least
and other petitions. to the public. 10 full-time jobs in the United States.
See INA section 203(b)(5), 8 U.S.C.
1153(b)(5). The INA permits DHS to
specify a higher investment amount if demonstrate continued eligibility for the at a U.S. consular post. See INA sections
the investment is in a high employment designation by submitting an Annual 203(e) and (g), 221 and 222, 8 U.S.C.
area or a lesser investment amount if the Certification of Regional Center (Form I– 1153(e) and (g), 1201 and 1202; see also
investment is in a TEA, defined to 924A) on an annual basis or as 22 CFR part 42, subparts F and G. The
include certain rural areas and areas of otherwise requested by USCIS. See 8 petitioner must generally wait to receive
high unemployment. Id.; 8 CFR 204.6(f). CFR 204.6(m)(6)(i)(B). USCIS may seek a visa application packet from the DOS
The INA allots 9,940 immigrant visas to terminate a regional center’s National Visa Center to commence the
each fiscal year for foreign nationals participation in the program if the visa application process. After receiving
seeking to enter the United States under regional center no longer qualifies for this packet, the petitioner must collect
the EB–5 classification. See INA section the designation, the regional center fails required information and file the
201(d), 8 U.S.C. 1151(d); INA section to submit the required information or immigrant visa application with DOS.
203(b)(5), 8 U.S.C. 1153(b)(5). Not less pay the associated fee, or USCIS As noted above, the wait for the visa
than 3,000 of these visas must be determines that the regional center is no depends on the demand for immigrant
reserved for foreign nationals investing longer promoting economic growth. See visas in the EB–5 category and the
in TEAs. See INA section 203(b)(5)(B), 8 CFR 204.6(m)(6)(i). As of September petitioner’s country of birth.7 Generally,
8 U.S.C. 1153(b)(5)(B). 10, 2018, there were 886 designated DOS authorizes the issuance of a visa
regional centers. and schedules the petitioner for an
B. The Regional Center Program
immigrant visa interview for the month
Enacted in 1992, section 610 of the C. EB–5 Immigrant Visa Process
in which the priority date will be
Departments of Commerce, Justice, and A foreign national seeking LPR status current. If the petitioner’s immigrant
State, the Judiciary, and Related under the EB–5 immigrant visa visa application is ultimately approved,
Agencies Appropriations Act, 1993, classification must go through a multi- he or she is issued an immigrant visa
Public Law 102–395, 106 Stat. 1828, step process during which the investor and, on the date of admission to the
established a pilot program that requires must sustain the investment. The United States, obtains LPR status on a
the allocation of a limited number of individual must first file an Immigrant conditional basis. See INA sections 211,
EB–5 immigrant visas to individuals Petition by Alien Investor (Form I–526, 216A, and 221, 8 U.S.C. 1181, 1186, and
who invest through DHS-designated or ‘‘EB–5 petition’’) with USCIS. The 1201.
regional centers. The Regional Center petition must be supported by evidence Alternatively, an EB–5 petitioner who
Program was initially designed as a pilot that the foreign national’s lawfully is in the United States in lawful
program set to expire after 5 years, but obtained capital is invested (i.e., placed nonimmigrant status generally may seek
Congress has continued to extend the at risk), or is actively in the process of LPR status by filing with USCIS an
program to the present day. See, e.g., being invested, in a new commercial application for adjustment of status,
Public Law 115–141, Div. M, Tit. II, sec. enterprise in the United States that will Form I–485. See INA section 245, 8
204 (Mar. 23, 2018). create full-time positions for not fewer U.S.C. 1255; 8 CFR part 245. Before
Under the Regional Center Program, than 10 qualifying employees.6 See 8 filing such an application, however, the
foreign nationals base their EB–5 CFR 204.6(j). EB–5 petitioner must wait until an
petitions on investments in new If USCIS approves the EB–5 petition, immigrant visa is ‘‘immediately
commercial enterprises located within the petitioner must take additional steps available.’’ See INA section 245(a), 8
‘‘regional centers.’’ DHS regulations to obtain LPR status. In general, the U.S.C. 1255(a); 8 CFR 245.2(a)(2)(i)(A).
define a regional center as an economic petitioner may either apply for an Generally, an immigrant visa is
unit, public or private, that promotes immigrant visa through a Department of considered ‘‘immediately available’’ if
economic growth, regional productivity, State (DOS) consular post abroad or, if the petitioner’s priority date under the
job creation, and increased domestic the petitioner is already in the United EB–5 category is earlier than the
capital investment. See 8 CFR 204.6(e). States and is otherwise eligible to adjust relevant date indicated in the monthly
While all EB–5 petitioners go through status, the petitioner may seek DOS Visa Bulletin. See 8 CFR
the same petition process, those adjustment of status by filing an 245.1(g)(1).
petitioners participating in the Regional Application to Register Permanent Whether obtained through the
Center Program may meet statutory job Residence or Adjust Status (Form I–485, issuance of an immigrant visa or
creation requirements based on or ‘‘application for adjustment of adjustment of status, LPR status based
economic projections of either direct or status’’) with USCIS. Congress has on an EB–5 petition is granted on a
indirect job creation, rather than only on imposed limits on the availability of conditional basis. See INA section
jobs directly created by the new such immigrant visas, including by 216A(a)(1), 8 U.S.C. 1186b(a)(1). Within
commercial enterprise. See 8 CFR capping the annual number of visas the 90-day period preceding the second
204.6(m)(3). In addition, Congress available in the EB–5 category and by anniversary of the date the immigrant
authorized the Secretary to give priority separately limiting the percentage of investor obtains conditional permanent
to EB–5 petitions filed through the immigrant visas that may be issued on resident status, the immigrant investor
Regional Center Program. See section an annual basis to individuals born in must file with USCIS a Petition by
601(d) of Public Law 102–395, 106 Stat. any one country. Investor to Remove Conditions on
1828, as amended by Public Law 112– To request an immigrant visa while Permanent Resident Status (Form I–
176, Sec. 1, 126 Stat. 1326 (Sept. 28, abroad, an EB–5 petitioner must apply 829). See INA section 216A(c) and (d),
2012).
6 Under current USCIS policy, the investor must
Requests for regional center
7 When demand for a visa exceeds the number of

sustain these actions through the end of the visas available for that category and country, the
designation must be filed with USCIS sustainment period (2 years from the date the demand for that particular preference category and
on the Application for Regional Center investor obtains conditional resident status). The country of birth is deemed oversubscribed. The
Designation Under the Immigrant total amount of time will vary, however, depending Department of State (DOS) publishes a Visa Bulletin
Investor Program (Form I–924). See 8 on when the investor firsts invests or becomes that determines when a visa may be authorized for
actively in the process of investing as well as the issuance. See U.S. Dep’t of State, Bureau of
CFR 204.6(m)(3)–(4). Once designated, amount of time the investor may wait to obtain Consular Aff., Visa Bulletin, available at https://
regional centers must provide USCIS status due to oversubscription for the investor’s travel.state.gov/content/visas/en/law-and-policy/
with updated information to nationality. bulletin.html.
8 U.S.C. 1186b(c) and (d); 8 CFR respect to these regulatory amendments, administration. Another commenter
216.6(a)(1). Failure to timely file Form except where new or supplemental suggested that the proposed regulation
I–829 results in automatic termination rationale is reflected below. Section III exceeds the scope of legislative changes
of the immigrant investor’s conditional of this final rule preamble includes a recently discussed by Congress.
permanent resident status and the summary and analysis of public Response: DHS disagrees with
initiation of removal proceedings. See comments that are pertinent to the commenters that it was premature to
INA section 216A(c), 8 U.S.C. 1186b(c); proposed rule. A brief summary of propose the rule prior to the
8 CFR 216.6(a)(5). In support of the comments DHS deemed to be out of reauthorization of the EB–5 Regional
petition to remove conditions, the scope or unrelated to this rulemaking, Center Program and that the issues
investor must show, among other things, making a substantive response addressed in the final rule are best
that the commercial enterprise was unnecessary, is provided at the end of resolved through the legislative process.
established, that he or she invested or Section III. Comments may be reviewed The final rule addresses overarching
was actively involved in investing the at http://www.regulations.gov, docket issues concerning the EB–5 program
requisite capital, that he or she number USCIS–2016–0006. generally, not just the Regional Center
sustained those actions for the period of Program. Additionally, the Regional
III. Response to Public Comments on Center Program has been reauthorized
residence in the United States, and that
the Proposed Rule numerous times in recent years, without
job creation requirements were met or
will be met within a reasonable time. DHS reviewed all of the public reform. See, e.g., Public Law 115–123
See 8 CFR 216.6(a)(4). If approved, the comments received in response to the (Feb. 9, 2018); Public Law 115–120 (Jan.
conditions on the investor’s permanent proposed rule and addresses relevant 22, 2018); Public Law 115–96 (Dec. 22,
residence are removed as of the second comments in this final rule, grouped by 2017); Public Law 115–31 (May 5,
anniversary of the date the investor subject area. DHS does not address 2017); Public Law 114–254 (Dec. 10,
obtained conditional permanent comments seeking changes in U.S. laws, 2016); Public Law 114–223 (Sept. 29,
resident status. See 8 CFR 216.6(d)(1). regulations, or agency policies that are 2016); Public Law 114–113 (Dec. 18,
unrelated to the changes to 8 CFR 204.6 2015). DHS has worked diligently to
D. Final Rule and 216.6 proposed in the NPRM. This provide technical assistance to Congress
In response to the proposed rule, DHS final rule does not resolve issues outside since 2014 to reform the EB–5 program
received 849 comments during the 89- the scope of this rulemaking. through legislation. To date, Congress
day public comment period. In addition, has not passed comprehensive EB–5
A. Need for Rulemaking and Regulatory
DHS reviewed 11 comments submitted reform legislation.9 In fact, some
Process
to the docket USCIS–2016–0008, EB–5 members of Congress have specifically
Immigrant Investor Regional Center Comments: Multiple commenters requested that ‘‘because Congress has
Program, an advance notice of proposed expressed support for general integrity failed to reform or end this program, we
rulemaking (ANPRM) published in the reforms and measures that deter fraud, call on the Department of Homeland
Federal Register two days prior to the but recommended the legislative Security to expeditiously finalize
proposed rule,8 but which contained process to reform the program. A few regulations that would reduce the
content relevant to the proposed rule. commenters urged DHS to withdraw the widespread abuses of the EB–5
As a result, DHS considered a total of proposed rule because the proposed program.’’ 10 DHS would, of course,
860 comment submissions in response reforms should be under the purview of faithfully implement any new
to the proposed rule. Approximately Congress, as they stated that the reforms legislation, if passed.
560 of the comments were letters are better addressed through the DHS agrees with the members of
submitted through mass mailing legislative process. The commenters Congress who requested taking this
campaigns and 290 comments were stated that the legislative process regulatory action because of the lack of
unique submissions. Commenters generally requires consensus building legislative reforms. DHS is finalizing
consisted primarily of individuals, and input from various stakeholders. this NPRM to implement needed
including some investors, but also One commenter stated that legislative regulatory reforms in a timely manner.
included anonymous submissions, law reform would be more comprehensive, Although the legislative process has
firms, advocacy groups, EB–5 job- address interconnected impacts, and certain benefits, the regulatory process
creating entities, EB–5 new commercial provide for needed reforms that go is transparent and includes the
enterprises, regional centers, non EB–5 beyond the statutory authority for solicitation of input from the public.
entity companies, industry professional regulatory reform. The commenter also These regulatory reforms do not require
associations, industry trade/business expressed concern that pending EB–5 new legislation; the statutory authority
associations, community or social legislation has conflicting changes that, underlying these regulatory reforms is
organizations, members of Congress, if passed, would supersede many or
and representatives from state and local most of the proposed regulatory changes 9 A number of pieces of legislation have been
governments. or render them moot. Another introduced. See generally S.1501, the ‘‘American
Following careful consideration of commenter stated that collecting Job Creation and Investment Promotion Reform Act
comments on this rule prior to the of 2015’’, 114th Congress (2015–2016); S.2415, the
public comments received, DHS made ‘‘EB–5 Integrity Act’’, 114th Congress (2015–2016);
some modifications to the regulatory reauthorization of the EB–5 Regional S.2122, the ‘‘Invest in Our Communities Act’’,
text proposed in the NPRM. The Center Program was premature; the 114th Congress (2015–2016); H.R. 5992, the
rationale for the proposed rule and the commenter asserted that a legislative ‘‘American Job Creation and Investment Promotion
solution could address the issues in the Reform Act of 2016’’, 114th Congress (2015–2016);
reasoning provided in the background and S.727, the ‘‘Invest in Our Communities Act’’,
section of that rule remain valid with proposed rule without the need for 115th Congress (2017–2018).
rulemaking. These commenters called 10 Website of U.S. Senator Charles Grassley,
8 The ANPRM is titled, ‘‘EB–5 Immigrant Investor for the withdrawal of the proposed rule Grassley, Goodlatte Call on DHS to Finalize EB–5
Regional Center Program’’ and was published on and asserted that even if these changes Regulations End Unacceptable Status Quo, (Mar.
January 11, 2017 at 82 FR 3211. The eleven 22, 2018), available at https://
comments from the ANPRM docket considered
were effected through regulation, any www.grassley.senate.gov/news/news-releases/
were 0002, 0005, 0006, 0007, 0008, 0009, 0015, regulatory changes should be drafted grassley-goodlatte-call-dhs-finalize-eb-5-
0018, 0021, 0024, and 0025. from scratch under the new regulations-end-unacceptable-status-quo.
set forth at length in the preamble to the changes to the Regional Center Program. DHS allow a supplemental Form I–526
proposed rule and elsewhere in this DHS decided to publish an ANPRM to filing and priority date retention for
preamble. For example, when creating gather this additional information. As petitioners if, under USCIS policy, a
the EB–5 program, Congress clearly DHS did not merge the two proposals, material change to an investment project
intended that the administering agency DHS believes an extension to the almost would require the filing of a new Form
may periodically raise the minimum 90-day comment period was not I–526 petition, as long as the petition
investment amounts. The INA provides warranted. was approvable when filed.
that the Secretary of Homeland Security Response: The final rule requires that
‘‘in consultation with the Secretary of B. Priority Date Retention the Form I–526 petition be approved for
Labor and the Secretary of State, may 1. Proposed Standards for Retaining a an EB–5 petitioner to retain the priority
from time to time prescribe regulations Priority Date date associated with that petition. DHS
increasing’’ the $1,000,000 minimum disagrees with commenters’ proposals
Comments: Many commenters
investment amount.11 Yet, even though that a priority date should attach when
discussed the proposed standards for
the Immigration and Naturalization the petition is filed, rather than when it
retaining a priority date. Several
Service had recommended before the is approved (including (1) where the
commenters expressed general support
creation of the EB–5 program that the pending petition is denied through no
for the proposal to allow EB–5 investors
minimum investment amount in an fault of the petitioner, or (2) the petition
to retain the original filing date of their
investor visa program be ‘‘adjusted was approvable when filed but a new
Form I–526 petition as logical and
periodically based on some criteria such petition is required due to the USCIS
necessary, especially with
as the Consumer Price Index,’’ 12 this material change policy). Section 203(e)
‘‘retrogression’’ or oversubscription of of the INA provides that immigrant
has never been done in the quarter
the category (i.e., lengthening of the visas must be issued to eligible
century since the program’s creation.
period of time before a priority date immigrants in the order in which a
Nor do the regulatory reforms require
assigned to a Form I–526 petition petition on behalf of each such
revision solely by virtue of a change in
becomes current and an EB–5 visa immigrant is filed. USCIS determines
administration. Finally, promulgation of
becomes available for issuance). They such eligibility through its approval of
these regulatory reforms does not
asserted that priority date retention petitions. See also, e.g., INA section
preclude legislative reform of the EB–5
would provide flexibility to investors as 203(b)(5) and (f), 8 U.S.C. 1153(b)(5) and
program by Congress.
Comments: Other commenters conditions change and may encourage (f); INA section 204(a)(1)(H) and (b), 8
disagreed with the approach to bifurcate investment in the United States by U.S.C. 1154(a)(1)(H) and (b); 8 CFR
EB–5 issues into an NPRM and an protecting EB–5 petitioners from having 103.2(b)(8)(i). Requiring approval of the
ANPRM, stating that the issues to ‘‘restart the clock’’ on their petition petition prior to establishment of a
contained in both were interconnected due to circumstances outside of their priority date is consistent with DHS’s
and must be addressed together. The control. One commenter stated that this historical interpretation of eligibility
commenters asked DHS to withdraw the change will mitigate otherwise with respect to order of consideration
NPRM and amend the ANPRM to catastrophic results that would occur to for visa issuance under INA section
include the issues addressed in the some petitioners stuck in the visa 203(e), the Department of State’s
NPRM (namely the designation of TEAs queue. One commenter stated that regulation on priority dates for visa
and minimum investment levels), as preserving the priority date can give the issuance, and DHS’s priority date
issues for an extended public comment investor an incentive to reinvest in a retention regulation for other
process prior to rulemaking. In doing so, project. DHS agrees that priority date employment-based categories. See 8
the commenters said DHS should also retention would protect petitioners and CFR 103.2(b)(1) (mandating eligibility
extend the comment period for the encourage investment. from time of filing through
ANPRM for 60 days, in order to solicit Several commenters stated that all adjudication); 22 CFR 42.53(a); 8 CFR
more meaningful and data-driven EB–5 petitions should retain the priority 204.5(e) (priority date retention). USCIS
comments. date, even if the EB–5 petition is not yet determines a petitioner’s eligibility as
Response: DHS disagrees with the approved, but did not provide any part of adjudication of the petition, and
commenters. The NPRM focused on additional justification for this USCIS’s approval of the petition along
issues common to all EB–5 petitioners, statement. Other commenters proposed with the filing date establishes the order
whether or not they are associated with that the priority date also be retained for of consideration for a visa.
a regional center. The ANPRM focused those petitions that were denied due to Additionally, the commenters’
exclusively on the Regional Center no fault of the petitioner—for instance, proposals to revise USCIS’s material
Program. DHS believed bifurcating the if an associated regional center is change policy would have implications
proposals was critical for two reasons: terminated before adjudication of the beyond priority date retention and the
(1) The EB–5 program is in need of petition due to its failure to meet scope of this rulemaking. DHS did not
reform related to the issues addressed in program requirements—because propose to revise its material change
the NPRM and this final rule; and (2) circumstances can change as a result of policy as part of the proposed rule for
DHS believed the agency had sufficient potentially lengthy Form I–526 this action. Rather, DHS solicited public
data to support the changes proposed in processing times. One commenter feedback on potential changes to the
the NPRM for the entire EB–5 program suggested that DHS use the same policy in the EB–5 Immigrant Investor
at the time of publication, whereas DHS standard as INA section 245(i) to Regional Center Program ANPRM. See
determine whether an EB–5 petitioner
desired to solicit additional data from 82 FR 3211 (Jan. 11, 2017).

stakeholders regarding potential may retain a priority date from an Moreover, allowing petitioners to
earlier filed EB–5 petition, where establish a priority date prior to the
11 INA section 203(b)(5)(C)(i). benefits attach if a petition was adjudication of the petition has negative
12 LegalImmigration Reforms: Hearing Before the approvable when filed, defined by the policy and operational implications.
Subcomm. on Immigration and Refugee Affairs of
the Senate Comm. on the Judiciary, S. Hrg. 100–990
commenter as properly filed, DHS believes that assigning a priority
at 90 (1987) (INS responses to questions by Senator meritorious in fact, and non-frivolous. date to a pending Form I–526 petition
Paul Simon) (1987). This commenter also recommended would incentivize frivolous petition
filings solely to establish an earlier Response: As explained above, DHS is constitute a material change to the
priority date. By assigning priority dates only providing priority date retention to petition.14 A change is material if the
only upon petition approval, DHS hopes EB–5 investors with approved Form I– changed circumstances would have a
to eliminate the possibility that 526 petitions for a range of reasons. DHS natural tendency to influence or are
investors may file a petition that is also notes that no law, regulation, or predictably capable of affecting the
unlikely to be approved purely to lock- DHS policy requires that the petitioner’s decision.15 Material changes prior to the
in an earlier priority date, which may capital be invested prior to petition approval of an EB–5 investor’s Form I–
lead to further delays in adjudication. approval. On the contrary, INA section 526 petition would render the petition
Additionally, allowing petitioners to 203(b)(5)(A)(i) provides that an investor ineligible for the benefit sought.
retain priority dates for unapproved can qualify for EB–5 status by showing Similarly, material changes after the
petitions that may have been approvable that he or she is ‘‘actively in the process approval of the Form I–526 but before
when filed would present an of investing.’’ See also 8 CFR 204.6(j)(2). the petitioner has obtained conditional
operational burden that would Nothing prevents a petitioner from permanent residence, would constitute
complicate and prolong the holding his or her contribution of good and sufficient cause to issue a
adjudications process, as USCIS would capital in escrow until the petitioner has notice of intent to revoke, which if not
need to determine whether priority date obtained conditional permanent overcome would constitute good cause
retention is possible for these petitions resident status.13 to revoke the petition’s approval.16 This
separate from its normal adjudications Comments: Several commenters rule provides petitioners faced with
framework. stated the proposal does not protect revocation of an approved petition due
For these reasons, the final rule will victims of EB–5 scams where to a material change the means to retain
only allow an EB–5 petitioner to retain investment capital was diverted, the priority date of that approved
the priority date from an approved Form misappropriated, or subjected to an petition when filing a new petition,
I–526 petition. Priority date retention is asset freeze. Some commenters except in cases of fraud,
not available in cases involving fraud or suggested that such victims be allowed misrepresentation, or material error. See
willful misrepresentation of a material to choose another project for re- final 8 CFR 204.6(d). DHS did not
fact by the petitioner, or when DHS investment and retain the filing date of propose to change its current material
determines that it approved the petition the pending Form I–526 petition as the change policy, either with respect to
based on a material error. See final 8 priority date. They suggested that, pending petitions or its ability to revoke
CFR 204.6(d). DHS believes this change because currently many investors who approved petitions, and does not intend
will address situations in which are victims of various EB–5 scams and to do so in this final rule. Rather, the
petitioners whom USCIS has already other criminal activities conducted by final rule provides certain petitioners
determined meet eligibility regional centers and project managers, with the opportunity to retain the
the victims cannot withdraw and priority date of their approved petitions
requirements may become ineligible
reinvest their funding because they if they submit another Form I–526
through circumstances beyond their
would lose their original priority date. petition for which they are qualified.
control (e.g., the termination of a
One commenter suggested that allowing See final 8 CFR 204.6(d). This
regional center) as they wait for their
victims to reinvest and retain the additional protection helps reduce the
visa priority date to become current as
priority date would provide fairness to impact of material changes to EB–5
well as provide investors with greater
investors and prevent deliberate EB–5 investors with approved petitions due to
flexibility to deal with changes to
scams in the future since investors changed business conditions.
business conditions.
would not be forced to maintain their Comments: Some commenters
In contrast to the proposed rule, this
investment in a fraudulent project just recommended that investors who may
final rule also clarifies that an investor
to preserve a priority date. be ineligible for EB–5 status due to
may retain a priority date from a Response: For the reasons explained
petition that had been approved but has circumstances outside their control,
above, DHS is only providing priority specifically fraud or force majeure
since been revoked on grounds not date retention to EB–5 investors with
specifically described in the provision. (established by showing any extreme
approved Form I–526 petitions. circumstance beyond anyone’s control),
The final rule also clarifies that if an Although DHS is sympathetic to
investor has multiple approved should not lose the benefit of any period
petitioners with pending petitions who for which the age of the investor’s child
petitions, the investor is entitled to the are victims of scams and other criminal
earliest qualifying priority date. See has been frozen under the Child Status
activities conducted by regional centers Protection Act (CSPA) such that the
final 8 CFR 204.6(d). and project managers, a petitioner must
Comment: One commenter stated that child might ‘‘age-out.’’ Other
be eligible at the time of filing and commenters suggested ‘‘freezing’’ the
some EB–5 investors with pending Form remain eligible until the petition is
I–526 petitions may have already child’s age at the time the EB–5
adjudicated. Retention of a priority date applicant files his or her Form I–526
invested their funds and created jobs, does not relieve petitioners of their
but their petitions may no longer be without specific reference to the CSPA.
burden to meet the relevant eligibility Several commenters expressed specific
approvable due to circumstances requirements, including their statutory
outside of their control, such as regional concerns regarding the children of
burden of investing the required Chinese investors aging out of the
center termination. The commenter minimum investment pursuant to INA
stated that the proposal would be unfair program due to the visa backlogs, which
203(b)(5)(A)(i). may ultimately cause potential investors
due to processing times, as some
In addition, certain changes to a with young children to invest in other

investors awaiting approval may have pending Form I–526 petition, including
already achieved the goals of the countries.
a change in regional center and certain
program, but cannot retain the priority changes relating to the new commercial 14 See USCIS Policy Manual, 6 USCIS–PM G (Jun.
date, while other similarly situated enterprise or job-creating entity, may 14, 2017).
investors will retain their priority dates 15 Id.
simply because their petitions were 13 See USCIS Policy Manual, 6 USCIS–PM G (Jun. 16 USCIS Policy Manual, 6 USCIS–PM G (Nov. 30,
approved. 14, 2017). 2016).
Response: While DHS appreciates the turns 21 while waiting for an immigrant demand that outpaced the supply in
commenters’ concerns regarding minor visa to become available.19 A visa numbers). 82 FR at 4756. Absent
beneficiaries who may age out during commenter also suggested DHS allow priority date retention, petitioners who
the process, DHS does not intend to priority dates to transfer to a petitioner’s may have met all of the requirements to
change its guidance regarding the heir if the petitioner is deceased. participate in the EB–5 program may
applicability of the CSPA. DHS notes Response: As stated previously, face harsh consequences upon losing
that, by statute, once a person turns 21, section 203(e) of the INA provides that their place in the immigrant visa queue
he or she is no longer a ‘‘child’’ for immigrant visas must be issued to if a material change occurs through no
purposes of the INA, subject to certain eligible immigrants in the order in fault of the investor. Once a visa
statutory exceptions by which which a petition on behalf of each such becomes available and a petitioner
individuals who surpass that age are or immigrant is filed. USCIS determines becomes a conditional permanent
may be considered to remain a ‘‘child’’ such eligibility through its approval of resident, oversubscription is no longer a
by operation of law. See INA sections petitions and establishment of priority concern. DHS believes there are other
101(b)(1) and 203(h), 8 U.S.C. 1101(b)(1) dates. Determination of eligibility for protections already in place for
and 1153(h). The CSPA was enacted on one immigrant cannot be substituted for individuals who are conditional
August 6, 2002, and provides another; each petitioning immigrant permanent residents and who seek to
continuing eligibility for certain must qualify on his or her own merit. remove conditions. For example, an
immigration benefits to the principal or INA 203(e); see 8 CFR 103.2(b)(1) (‘‘An immigrant investor may proceed with
derivative beneficiaries of certain applicant or petitioner must establish the petition to remove conditions and
benefit requests after such beneficiaries that he or she is eligible for the present documentary evidence
reach 21 years of age. See Public Law requested benefit at the time of filing the demonstrating that, notwithstanding
107–208; INA sections 201(f), 203(h), benefit request and must continue to be deviation from the business plan
204(k), 207(c)(2), and 208(b)(3), 8 U.S.C. eligible through adjudication.’’ contained in the initial Form I–526
1151(f), 1153(h), 1154(k), 1157(c)(2), (emphasis added)).20 For that reason, petition, the requirements for the
and 1158(b)(3).17 the final rule explicitly states that a removal of conditions have been
The CSPA, among other things, priority date is not transferable to satisfied.21 Further, a priority date
protects minor beneficiaries from aging another alien. See final 8 CFR 204.6(d). cannot generally be re-used in other
out of their beneficiary status due to the Comment: One commenter suggested employment-based or family-based
length of time that it takes DHS to extending priority date retention preference categories once the
adjudicate petitions.18 By contrast, the benefits to investors who have already individual becomes a lawful permanent
priority date retention provision in this obtained conditional LPR status to resident. Thus, consistent with DHS’s
rule is meant to protect investors with alleviate the burden on investors who treatment of individuals who obtain
approved petitions from losing a will otherwise be unable to obtain permanent residence under other
priority date while awaiting an permanent LPR status through no fault immigrant classifications, DHS declines
immigrant visa. Protection against fraud of their own. The commenter also to create an anomalous carve-out for one
or force majeure is beyond the scope of asserted that delays in adjudicating class of immigrants allowing them to
the CSPA. DHS has not been presented I–829 petitions increase the risk to the repeatedly jump to the beginning of the
with any evidence of reduced interest in investor that ‘‘situations in which visa queue ahead of others who may
the EB–5 program due to its application petitioners may become ineligible have endured a lengthy wait to obtain
of the CSPA, and has no way of through circumstances beyond their a visa. Once a priority date is used by
determining in what manner application control (e.g., the termination of a virtue of the petitioner becoming a
of the CSPA will affect future regional center) may occur. conditional permanent resident, he or
investment levels under the EB–5 Response: As explained in the NPRM, she will have obtained the benefit
program. DHS notes, however, that DHS proposed priority date retention to connected to the priority date, and DHS
some children of principal beneficiaries provide flexibility to deal with changes
will not permit the priority date to be
of EB–5 petitions may benefit from to business conditions in light of
retained for further use.
priority date retention in that, if there is oversubscription of the program (i.e.,
a visa backlog, they may spend a shorter 2. Other Comments on Priority Date
amount of time in the queue, thus 19 INAsection 203(d) allows a spouse or child as Retention
defined in INA section 101(b)(1)(A), (B), (C), (D), or
reducing the possibility they will reach (E), 8 U.S.C. 1101(b)(1)(A), (B), (C), (D), or (E), to Comment: One commenter requested
an age that they no longer qualify as accompany or follow to join a spouse or parent as that USCIS clarify that priority dates for
derivative beneficiaries. a family-preference, employment-based, or diversity EB–5 petitions are determined based on
Comments: Some commenters immigrant. INA section 101(b)(1) defines a child as
the date of filing the initial petition.
suggested that DHS allow an EB–5 an unmarried person under 21 years of age.
Consequently, if a primary immigrant’s child has Response: DHS agrees with the
investor to freely gift and transfer his or turned 21 and has not yet immigrated, that child is commenter and has added language that
her priority date from an approved no longer eligible to accompany or follow to join was inadvertently left out of the NPRM
petition to another family member the primary immigrant.
20 In addition, INA 203(b)(5)(A) provides that
to the final regulatory text. See final 8
(either by switching the principal CFR 204.6(d) (‘‘The priority date of a
visas shall be made available to qualified
investor or having a family member file immigrants seeking to enter the United States ‘‘for petition for classification as an investor
a new Form I–526), such as a child, to the purpose of engaging in an NCE . . . in which is the date the completed, signed
prevent a child from aging out, or losing such alien has invested or is actively in the process petition (including all initial evidence
of investing . . . .’’ And INA 203(e) states that
the ability to immigrate if he or she and the correct fee) is properly filed.’’).
immigrant visas made available under subsection
(a) or (b) of this section shall be issued to ‘‘eligible Comment: One commenter expressed
17 Guidance on the agency’s application of the
immigrants in the order in which a petition in concern with DHS proposing priority
CSPA to visa petitions can be found in the USCIS behalf of each such immigrant is filed.’’ DHS
Policy Manual. See USCIS Policy Manual, 7 USCIS–
date retention along with changes to the
believes that these provisions, taken together, are
PM A (Nov. 30, 2016). best read as contemplating eligibility by a single investment amounts and TEA
18 See INA section 203(h); USCIS, Child Status petitioner whose visa is made available in the order
Protection Act, https://www.uscis.gov/greencard/ in which such individual petitioned and 21 USCIS Policy Manual, 6 USCIS–PM G (Nov. 30,
child-status-protection-act. established eligibility. 2016).
designation process. The commenter petition. The regulatory requirements, permanent residents. The final rule is
recommended that if DHS finalizes the including the minimum investment also intended to produce parity in
priority date retention provision, the amounts and TEA designation process, priority date retention between EB–5
following information will also need to in place at the time of filing the petition petitioners and beneficiaries of petitions
be clarified for investors during a will govern the eligibility requirements under other employment-based
transition period: (1) The amount of for that petition, regardless of the categories.
money investors need to invest during priority date. DHS believes this manner In response to commenter concerns
the transition period if they want to of implementation best balances the that a fraudulent project or sponsor
move their investment dollars to a needs of investors, parity of treatment could affect an innocent petitioner, DHS
different qualifying project (i.e., must among investors, and operational clarifies in the final rule that the fraud
they reinvest the amounts required concerns. or willful misrepresentation of a
under this rule or may they reinvest at Comment: One commenter stated that material fact must be done by the
the same investment level permitted the priority date proposal would create petitioner. See final 8 CFR 204.6(d)(1).
before the new regulatory requirements unexpected delays to petitioners who Comment: One commenter suggested
take effect); and (2) whether if investors had done their due diligence and that because a petition must be
who are able to reinvest at the earlier chosen a successful project. The approvable both at the time it was filed
levels and retain their priority date commenter believes that roughly 15 and also on the date it is adjudicated,
would be able to reinvest that money percent of projects are failing or have the priority date retention proposal
into a project that was located within a failed. The commenter argued that, if would create the potential for the
TEA in place before the new regulatory priority dates can be retained, then most retroactive application of the regulations
requirements have taken effect at the petitioners in failed projects are likely to to pending Form I–526 and Form I–829
amounts then authorized for investment re-file through a different project, thus petitions as well as to current
in TEAs. The commenter expressed a causing petitioners already in the queue conditional permanent residents. Citing
preference for allowing investment to wait longer for a visa that otherwise to Bowen v. Georgetown Univ. Hosp.,
consistent with the regulatory regime in would have become available due to the 488 U.S. 204, 208, 109 S. Ct. 468, 471
existence prior to this rule becoming failed projects. The commenter (1998), the commenter argued that there
effective, and allowing investment recommended that priority date is no precedent for retroactive
opportunities in any type of project, retention be restricted to projects where application of regulations.
regardless of the project’s future TEA Form I–829 petitions would be denied Response: The final rule does not
status once a final rule takes effect. only because of fraud committed by the change the longstanding requirement at
‘‘EB–5 sponsors,’’ rather than assisting 8 CFR 103.2(b)(1) that a petitioner
Response: DHS appreciates the investors whose projects fail for other
commenter’s concerns and has clarified demonstrate eligibility at the time of
reasons. Another commenter stated that filing and throughout adjudication, and
the effective date and implementation innocent investors should not be
process in this final rule preamble in thus it does not result in a retroactive
punished by fraud and scams application of regulations. The preamble
Sections I.E and I.F. The changes in this committed by the investment project.
rule will apply to any Form I–526 filed to this final rule also clarifies the
Response: As contemplated by effective date of this rule, as well as
on or after the effective date of the rule, Congress, the immigrant investor visa
including any Form I–526 filed on or implementation procedures in Sections
was a way to provide aliens an I.E and I.F. As explained above, the
after the effective date where the immigration incentive for investing and
petitioner is seeking to retain the changes in this rule will apply to all
creating jobs in the United States. For Form I–526 petitions filed on or after
priority date from a Form I–526 petition petitioners with approved petitions who
filed and approved prior to the effective the effective date of the final rule.
invest in projects that appear unlikely to Petitions filed before the effective date
date of this rule. A Form I–526 succeed after petition approval and
petitioner can retain the priority date will be adjudicated under the
while the investor is awaiting visa regulations in place at the time of filing.
from an approved Form I–526 petition availability, priority date retention
filed prior to the effective date of this As the final rule will only apply to
provides further incentive for them to petitions filed on or after the effective
rule, so long as the petitioner is not reinvest in another project in the United
lawfully admitted to the United States date, DHS does not anticipate that the
States as opposed to withdrawing their
as a conditional permanent resident final rule will be applied retroactively.
investment in the United States. In
based on that earlier-approved petition, addition, providing for priority date C. Increases to the Investment Amounts
and USCIS did not revoke the approval retention only where a Form I–526
based on the petitioner’s fraud or willful 1. Increase to the Standard Minimum
petition has been approved is consistent
misrepresentation or because USCIS Investment Amount
with Congress’s goal of issuing visas to
determined that it approved the petition eligible immigrants in the order Comments: Multiple commenters
based on material error. This rule petitions were filed, in that it allows stated that the proposed standard
becomes binding on petitioners on the investors to remain in the queue only if minimum investment amount is too
effective date; beginning at that time, the agency had deemed them eligible for high because it would greatly reduce the
any new petition, regardless of whether EB–5 classification. Although DHS number of investors in the EB–5
the petitioner had previously filed a acknowledges the commenter’s point program, but did not suggest an
Form I–526, must meet the eligibility that priority date retention could alternative. Similarly, many
requirements in place at the time of commenters agreed that the minimum
potentially result in a longer wait in the

filing. See 8 CFR 103.2(b)(1). DHS visa queue for some petitioners, the investment amount should increase, but
believes it would be operationally final rule provides equitable relief to stated that $1.8 million was too high
burdensome to set and adjudicate those EB–5 petitioners described in the because, combined with the TEA
different eligibility requirements for comment who find that, through no designation changes, the increase will
investors who want to move their fault of their own, their approved Form result in many projects that could
investment dollars to a different I–526 cannot be used to seek admission previously have been funded with
qualifying project and must file a new to the United States as lawful $500,000 individual investments now
needing $1.8 million individual exercised its authority to increase the U.S.-based commercial lending funds
investments. Several commenters noted minimum investment amount. As a due to the U.S. financial crisis in 2008
that the proposed amounts far exceed result, over time, inflation has eroded led to interest in alternative funding
those proposed and under consideration the present-day value of the minimum sources, such as the EB–5 program.24
by Congress, and one commenter investment required to participate in the The commenter who claimed that lower
suggested reducing the standard and EB–5 program—leaving it at little more utilization of the program in the past
TEA minimum investment amounts by than half its real value when the was due to the investment amount being
half of the current amount. Other program was created. Thus, after too high also acknowledged that the
commenters suggested DHS consider consulting with the Departments of demand for EB–5 funds from eligible
investment amounts ranging from State and Labor, DHS proposed in the projects is not dependent on the level of
$500,000 to $1.5 million. One NPRM to increase the minimum investment set by DHS. The commenter
commenter stated that the amount set in investment amount consistent with claimed that demand was instead set by
1990 was too high as evidenced by the increases in the CPI–U during the market factors totally independent of
program not being fully utilized before intervening period, for a new minimum EB–5, most notably risk tolerance of
2014 and suggested that setting the investment amount of $1.8 million. primary lenders and the level of the
investment amount too high will repeat DHS disagrees with the commenter premium charged by commercial
the mistake. The commenter asserted who suggested that lower utilization of lenders.
that job creation was the most important the program is evidence that the Regardless of what factors ultimately
principle and the investment amount investment amount was set too high accounted for higher utilization of the
was just a ‘‘gate keeping mechanism,’’ prior to 2014, because DHS has reason program, the reality is that the program
but did not provide additional support to believe other factors significantly has become and remains hugely
for these assertions. contributed to lower utilization of the oversubscribed at current investment
Several commenters expressed program. For example, in 2009, a CIS levels, DHS disagrees with commenters
support for the proposal to increase the Ombudsman’s recommendation for the who assert that raising the minimum
standard investment amount to $1.8 EB–5 program discussed various reasons investment amount would necessarily
million; some expressed support for the for the program’s lower utilization cause the number of EB–5 investors to
proposed increase, but did not focus on related to administrative obstacles and return to the levels in the earliest days
a specific amount. Commenters uncertainties that undermined of the program, or even to fall below the
supporting the proposed minimum stakeholder confidence, including number necessary to ensure full
investment increases stated that the uncertainty in the program, changes in utilization of the 9,940 visas available a
market can handle an increase in the guidance, concerns of insider access, as year, as demand is related to a range of
minimum investment amounts and that well as suspicions of abuse, internal and external factors.25
leading investor visa programs in other misrepresentation, and fraud.22 The The program makes available 9,940
countries require investment amounts Ombudsman also cited to a 2005 immigrant visas a year, and as of
higher than those recommended by Government Accountability Office December 1, 2018, there are 40,017
DHS. Several commenters agreed with (GAO) report which attributed ‘‘low beneficiaries (principals and immediate
updating the minimum investment participation to a series of factors that family members) of approved EB–5
amount to account for inflation. One led to uncertainty among potential petitions 26 waiting for the availability of
commenter agreed with the proposal to investors. These factors include an immigrant visas. According to the
increase the minimum investment onerous application process; lengthy Department of State’s Visa Bulletin for
amount to account for inflation, and adjudication periods; and the December 2018, petitioners from
stated the increase was necessary to suspension of processing of over 900 mainland China must have a priority
realistically achieve the goal of EB–5 cases—some of which date to date (the date of filing of the I–526
sustaining 10 full-time employees in 1995—precipitated by a change in petition with USCIS) before August 22,
light of the increases in national average [USCIS’] interpretation of regulations 2014, in order for an immigrant visa to
salaries from 1990 to 2015. Some regarding financial [qualifications].’’ 23 be available.27 In addition, as of
members of Congress noted that the Although neither the Ombudsman nor
increase is important in order for the the GAO expressly reviewed statutory 24 ‘‘A Roadmap to the Use of EB–5 Capital: An
program to recapture the real 1990 requirements such as the Alternative Financing Tool for Commercial Real
investment value and infuse additional Congressionally-set minimum Estate Projects,’’ Professor Jeanne Calderon and
capital in to the United States. They investment amount, and were instead Guest Lecturer Gary Friedland of the NYU Stern
further stated that the failure to adjust School of Business (May 22, 2015) (‘‘Despite the
focused on USCIS implementation of Program’s enactment by Congress in 1990, for many
the minimum investment amount for the EB–5 program and how that may years EB–5 was not a common path followed by
inflation has cost the U.S. economy have contributed to low participation, immigrants to seek a visa. However, when the
billions of dollars each year in potential both reports give DHS reason to believe traditional capital markets evaporated during the
investment funds, ultimately requiring Great Recession, developers’ demand for alternate
the program’s lower utilization in the capital sources rejuvenated the Program. Since
developers to attract more foreign past is due to a range of reasons. 2008, the number of EB–5 visas sought, and hence
investors than needed in order to raise In addition, DHS notes that other the use of EB–5 capital, has skyrocketed. EB–5
the desired amount of capital. trends led to higher utilization of the capital has become a capital source providing
Response: In 1990, Congress set the extraordinary flexibility and attractive terms,
program over the last 10 years. For especially to finance commercial real estate
minimum investment amount for the example, the reduction of available projects.’’).
program at $1 million and authorized 25 To the extent that the changes made by this
the Attorney General (now the Secretary 22 CIS Ombudsman, Employment Creation rule reduce the number of investors, the INA
of Homeland Security) to increase the Immigrant Visa (EB–5) Program Recommendations, provides that unused visas would be allocated to
minimum investment amount, in March 18, 2009, available at https://www.dhs.gov/ different employment-based categories. See
xlibrary/assets/CIS_Ombudsman_EB-5_ generally INA section 203(b), 8 U.S.C. 1153(b).
consultation with the Secretaries of
Recommendation_3_18_09.pdf. 26 According to internal program office and
State and Labor. INA section 23 GAO, Immigrant Investors: Small Number of adjudication records.
203(b)(5)(C)(i), 8 U.S.C. 1153(b)(5)(C)(i). Participants Attributed to Pending Regulations and 27 U.S. Dep’t of State, Bureau of Consular Aff.,
Neither the former INS nor DHS has Other Factors, p.3 GAO–05–256 (Apr. 2005). Visa Bulletin for December 2018, available at
December 1, 2018, USCIS had 13,125 investors may choose not to wait for noted that the comparison failed to
pending I–526 petitions that had yet to such an extended period of time before account for other investor immigration
be adjudicated.28 Using the average of they can immigrate to the United States, programs with minimum investment
1.81 derivative beneficiaries for each especially considering that most amounts ranging from $40,000 USD to
EB–5 principal who received an petitioners invest the required capital $1.8 million USD, including programs
immigrant visa over fiscal years 2014– well before their petitions are approved. in Antigua and Barbuda, Austria,
2016 29 and assuming that about 10% of This might at least in part account for Belgium, Cayman Islands, Cyprus,
petitions filed will be denied, the fact that the number of petitions Dominica, Grenada, Hong Kong, Ireland,
terminated, or withdrawn, this would filed has fallen each year since reaching Jersey, Malaysia, Malta, Monaco,
represent 33,193 potential beneficiaries. a high water mark in fiscal year 2015. Portugal, and Singapore.
Thus, there are already in the pipeline By fiscal year 2018, the number of Response: Even with the increase, the
approximately 73,000 beneficiaries or petitions filed had fallen by more than EB–5 program will remain competitive
potential beneficiaries—representing half.33 In the future, the number of with other countries’ visa programs as
over seven years’ worth of EB–5 foreign investors impacted by the per- discussed in the NPRM.34 In the NPRM,
immigrant visas as allocated by country cap and the resultant waiting DHS compared the EB–5 program to the
Congress. list for EB–5 visas who choose to file United Kingdom’s Tier 1 Investor Visa,
The inevitable result has been ever petitions may well further decline to the Australia’s Significant and Premium
growing wait times for immigrant visas point that total petitions filed each year Investment Programs, Canada’s
to become available for EB–5 petitioners may not even account for the 9,940 visas Immigrant Investor Venture Capital
with approved petitions born in allocated. This decline, of course, would Pilot Program, and New Zealand’s
mainland China (and their derivative be independent of the particular Investor 1 Resident Visa. See 82 FR at
beneficiaries). The annual EB–5 visa cap minimum investment amounts required 4757. DHS noted in the NPRM that it
was reached for the first time in fiscal by regulation, but may mitigate any has no means of ascertaining an
year 2014.30 In May 2015, the State decline that might be associated with investor’s preference for a given
Department found it necessary to such amounts. This is because some program, but believes an investor’s
establish a waiting list for petitioners prospective petitioners who might have decision would be based in part on the
with approved petitions born in foregone use of the program due to investment amount and country-specific
mainland China, when it announced increases in the investment amounts investment risk preferences of each
that immigrant visas were available only would have already foregone use of the investor. Id. DHS focused on the UK,
for such petitioners (with investments program due to overall waitlist issues. Australia, Canada, and New Zealand
in regional center projects and/or To commenters who suggest that DHS because these countries offer similar
projects in TEAs) whose priority dates establish a new standard minimum program requirements, immigration
were earlier than May 1, 2013.31 That investment amount below the $1 benefits, and comparable financial risk
waiting list has since grown, so that EB– million threshold, DHS notes that the to the United States.
5 visas are only now available for current investment amounts are the DHS disagrees with the comment
petitioners born in mainland China with minimum set by statute, and DHS does suggesting that these programs do not
priority dates before August 22, 2014— not have authority to reduce them carry risk. While the types of
which represents a wait of over 40 beyond those amounts. investments allowed in each program
months. As there are over seven years’ Comments: Many commenters differ, they carry varying levels of
worth of beneficiaries in the pipeline, suggested that the proposed increase financial risk. The UK requires
the wait time will likely only grow. would make the EB–5 program less
Given that over 80% of EB–5 competitive with other countries’ 34 The United Kingdom’s Tier 1 Investor visa
petitioners who receive immigrant visas programs. Several commenters requires a minimum investment of £2,000,000
do not adjust their status from within suggested that the proposed rule’s (approximately $2.7 million USD), and offers
comparisons to other investor visa permanent residence to those who have invested at
the United States, but receive their visas least £5,000,000 (approximately $8.1 million USD).
overseas,32 many potential EB–5 programs were flawed and failed to Tier 1 (Investor) Visa, Gov. UK, https://www.gov.uk/
account for the differences between the tier-1-investor/overview. Australia’s Significant and
https://travel.state.gov/content/travel/en/legal/visa- programs other than the investment Premium Investment Visa Programs require AU $5
law0/visa-bulletin/2019/visa-bulletin-for-december- amount, highlighting that the EB–5 million (approximately $3.9 million USD) and AU
$15 million (approximately $11.8 million USD),
2018.html. program stands alone in requiring respectively; its ‘‘investor stream’’ visa program
28 According to internal program office and
investors to place their investment at- requires an AU $1.5 million (approximately $1.2
adjudication records.
29 See DHS, 2016 Yearbook of Immigration
risk. Two commenters questioned DHS’ million USD) investment and a host of other
Statistics (table 7); DHS, 2015 Yearbook of
comparison to Canada’s closed requirements. Business Innovation and Investment
Immigrant Investor Venture Capital Visa, Australian Government, http://
Immigration Statistics (table 7); DHS, 2014 www.homeaffairs.gov.au/Trav/Visa-1/188-.
Yearbook of Immigration Statistics (table 7). Program, which they described as Canada’s Immigrant Investor Venture Capital Pilot
30 DHS, 2014 Yearbook of Immigration Statistics
having failed because it required a high Program required a minimum investment of CDN $2
(table 7). capital contribution and funds that must million (approximately $1.6 million USD) and a net
31 U.S. Dep’t of State, Bureau of Consular Aff.,
be placed at risk, instead of focusing on worth of CDN $10 million (approximately $8
Visa Bulletin for May 2015, available at https:// million USD) or more. Immigrant Investor Venture
travel.state.gov/content/travel/en/legal/visa-law0/ its Quebec Program. One commenter Capital Pilot Program, Government of Canada,
visa-bulletin/2015/visa-bulletin-for-may-2015.html. https://www.canada.ca/en/immigration-refugees-
This is a result of the interaction between the 33 In fiscal year 2015, USCIS received 14,373 EB– citizenship/services/immigrate-canada/immigrant-
employment-based green cards per-county caps and 5 petitions; in fiscal year 2016, 14,147; in fiscal year investor-venture-capital/eligibility.html. New
the fact that the overwhelming majority of EB–5 2017, 12,165; and in fiscal year 2018, 6,424. See Zealand’s Investor 1 Resident Visa requires a NZ
visas (75% in fiscal year 2017) go to beneficiaries U.S. Citizenship and Immigration Services, Number $10 million (approximately $7.1 million USD)
born in maintain China. See section 202 of the INA, of Form I–526, Immigrant Petition by Alien investment, and its Investor 2 Resident Visa
8 U.S.C. 1152; Bureau of Consular Affairs, U.S. Entrepreneur, by Fiscal Year, Quarter, and Case requires a NZ $3 million (approximately $2.1
State Department, Report of the Visa Office Fiscal Status 2008–2018, available at https:// million USD) investment. Investor Visas, New
Year 2017 (table V (part 3)). preview.uscis.gov/sites/default/files/USCIS/ Zealand Now, https://
32 In fiscal year 2017, 83% of EB–5 visas were Resources/Reports%20and%20Studies/ www.newzealandnow.govt.nz/move-to-nz/new-
issued overseas. See DHS, 2017 Yearbook of Immigration%20Forms%20Data/Employment- zealand-visa/visas-to-invest/investor-visa. Currency
Immigration Statistics (table 7). based/I526_performancedata_fy2018_qtr4.pdf. exchange calculations are as of January 2018.
investments in government bonds, share DHS reviewed each of the countries Comments: A few commenters
capital, or loan capital.35 Australia where government-provided suggested the increase would favor
permits investment in a variety of information was readily available.41 continued participation by wealthy
options, including bonds, stocks, and Some countries may require a lower investors only, instead of encouraging
equity funds.36 Canada required investment amount, but include innovative, forward-thinking
investment into an at-risk Immigrant additional requirements that the EB–5 entrepreneurs, small businesses, and
Investor Venture Capital Fund for 15 program does not require. For example, younger investors.
years.37 New Zealand’s investment to be considered for a visa/entry permit Response: Congress enacted the
options include government bonds, to enter the Hong Kong Special investor visa program to attract
residential property development, and Administrative Region for investment as entrepreneurs and job-creators into the
equity in public or private New Zealand an entrepreneur, the applicant must, U.S. economy 44 and infuse new capital
firms.38 Such investments present levels among meeting other requirements, into the country.45 Congress did not
of risk that are generally comparable to have a ‘‘good education background, specify any particular type of investor it
the level of risk associated with many normally a first degree in a relevant was seeking.46 As discussed previously,
EB–5 investments. field.’’ 42 In general, DHS found that DHS believes that the increase to the
With respect to the Quebec Program, none of the countries raised by minimum investment amount is
DHS does not believe it is comparable commenters present a straight-line appropriate because inflation has
to the EB–5 program. The Quebec comparison to the EB–5 program. There eroded the present-day value of the
program requires a CDN $800,000 is no way to quantify an individual’s minimum investment required to
(approximately $620,000 USD), 5-year desire to resettle in the United States or participate in the EB–5 program since
non-interest bearing investment.39 any other country. Each country has Congress set the initial investment
While this amount is lower than the varying requirements, and there is no amounts in 1990, and this final rule is
new EB–5 minimum investment universal standard of success for an an effort at remedying that erosion. In
amounts, that program also has immigrant investor program. That said, addition, DHS believes the increased
numerous other primary requirements DHS believes the increase is reasonable amount will attract the same type of
in order to qualify. These include when the minimum investment amount investment levels that Congress
requirements that the applicant have net is compared to the investor visa intended to attract in 1990.
assets of CDN $1.6 million DHS recognizes that many EB–5
programs of similarly developed
(approximately $1.2 million USD), petitioners do not necessarily take an
economies, such as the United
experience in management, as well as a entrepreneurial role in the operations of
Kingdom, Canada, Australia, and New
requirement that the investor intends to their new commercial enterprise;
Zealand, which typically require higher
settle in the Province of Quebec. The however, the EB–5 program has been
investment thresholds than what DHS and may continue to be used by
EB–5 program does not have additional proposes.43 petitioners who do take an
experience requirements. Additionally,
entrepreneurial role in the operations of
the EB–5 program does not require 41 Citizenship by Investment, Antigua & Barbuda,
their new commercial enterprise.
settlement in a particular location in the available at http://cip.gov/ag; Persons of
Independent Means and Investors, Cayman Islands, Moreover, under the current regulatory
United States, which would be highly
available at http://www.immigration.gov.ky/portal/ and statutory regime, the EB–5 program
restrictive. The investor simply loans page/portal/immhome/livinghere/ contains no specific entrepreneurship
his or her money to the Canadian independentmeans; Citizenship by Investment, requirements. DHS does not
government for 5 years. While there is Commonwealth of Dominica, available at http://
cbiu.gov.dm/faqs; Investment as Entrepreneurs, differentiate between and collects no
no risk posed to the investor in terms of
Hong Kong Immigration Department, available at data on petitioners who take an
losing some or all of the principal, the http://www.immd.gov.hk/eng/services/visas/ entrepreneurial role in the operations of
zero-interest condition means that investment.html; Investor and Entrepreneur their new commercial enterprise relative
investors in the Quebec program do Schemes, Department of Justice and Equality, Irish
Naturalisation and Immigration Service, available to those who do not. Accordingly, DHS
incur an opportunity cost of investing,
at http://www.inis.gov.ie/en/INIS/Pages/ has no data to support and there is no
as the present value of their investment New%20Programmes%20for%20Investors%20 persuasive reason to believe that raising
would be discounted for the five-year and%20Entrepreneurs; Jersey Immigration Rules, the minimum investment amount would
period.40 States of Jersey, available at https://www.gov.je/
travel/informationadvice/visitors/documents/ disproportionately decrease the number
35 Tier 1 (Investor) Visa, Gov.UK, available at
ld%20immigration%20rules%20jm%20130217.pdf; of petitioners who take an
https://www.gov.uk/tier-1-investor/overview.
Individual Investor Programme, Republic of Malta, entrepreneurial role in their new
available at http://iip.gov.mt/. commercial enterprise relative to those
36 Business Innovation and Investment Visa,
42 Investment as Entrepreneurs, Immigration
Australian Government, available at http:// Department, The Government of the Hong Kong
who do not.
www.homeaffairs.gov.au/Trav/Visa-1/188-. Special Administrative Region; available at http:// Comments: Several commenters
37 Determine your eligibility—Immigrant Investor
www.immd.gov.hk/eng/services/visas/ stated that the proposed increase to the
Venture Capital Pilot Program, Government of investment.html.
Canada, available at https://www.canada.ca/en/
standard investment amount would
43 See Madeleine Sumption and Kate Hooper,
immigration-refugees-citizenship/services/ result in long wait times for projects
‘‘Selling Visas and Citizenship: Policy Questions
immigrate-canada/immigrant-investor-venture- from the Global Boom in Investor Immigration’’, involving Chinese EB–5 investors due to
capital/eligibility.html. Migration Policy Institute (October 2014) at 7, currency control efforts in China that
38 Investor Visas, New Zealand Now, available at
available at https://www.migrationpolicy.org/ limit the transfer of funds, and
https://www.newzealandnow.govt.nz/move-to-nz/ research/selling-visas-and-citizenship-policy-
new-zealand-visa/visas-to-invest/investor-visa. concluded that the increase therefore
questions-global-boom-investor-immigration
39 Investor Program, Government of Quebec,

(‘‘Among the popular English-speaking will undermine almost any legitimate
available at http://www.immigration- destinations, the United Kingdom has the highest project. One commenter estimated the
quebec.gouv.qc.ca/en/immigrate-settle/ minimum threshold at GBP 1 million, followed by proposed increases in investment
businesspeople/applying-business-immigrant/three- New Zealand and Australia which require US $1.2
programs/investors/index.html.
amounts would extend the transfer time
million and US $1.3 million respectively. The
40 We refer to the Quebec program in the present United States’ minimum is significantly cheaper, at
44 136 Cong. Rec. S35,615 (Oct. 26, 1990).
tense because although it had been terminated US $500,000, but requires a more risky investment
45 S.Rept. 101–55, p. 21 (1989).
several years ago, it was reopened recently (2018) (in private-sector businesses rather than
for a temporary period. government bonds).’’). 46 136 Cong. Rec. S35,615.
by at least 5 times and another competitive in 2008, when the price of adequate capitalization of an EB–5
commenter suggesting the transfer time the investment program began to match enterprise, DHS believes that the CPI–U
would be close to 11 months. Other demand and the number of petitions also provides an appropriate reference
commenters suggested a more limited began to increase, or in 2011 when the point for the purpose of ensuring the
increase to encourage investors from visa allocation was fully utilized. statutorily required level of job creation.
countries other than China to continue Several commenters noted that 2011 DHS therefore believes that, as
to participate in the program. Another was the first year the number of Form proposed, the CPI–U is an appropriate
commenter stated the proposed increase I–526 petitions filed represented nearly measure for changes to the minimum
in investment amounts would render the supply of visas available (thus, visa investment amount.
the program dependent on investors supply nearly equaled visa demand). DHS recognizes that other alternative
from China. These commenters recommended that measures may provide a broader or
Response: DHS does not believe it is DHS calculate the adjustment to the more accurate measure of inflation for
appropriate to limit the increase to the minimum investment amounts from a certain purposes, but DHS also notes
minimum investment amount below base year later than 1990, such as 2008 that the government uses CPI–U for a
what was proposed in order to attempt or 2011. range of inflation adjustments. The
to attract investment from specific In addition, one commenter suggested technical change that DHS made to the
countries, nor does DHS believe that the DHS attempt some analysis of the price inflation adjustment formula in this rule
policies of any specific country should elasticity of demand for EB–5 visas (tying the adjustment back to 1990,
dictate the administration of the EB–5 before adjusting the minimum rather than to the prior adjustment) will
program. DHS believes the increase to investment amount based on the CPI–U ensure that disparities between different
the minimum investment amount based for the past 25 years in one adjustment. measures are not exacerbated over time.
on inflation is appropriate and justified Response: DHS considered a number Thus, DHS believes the CPI–U is the
for the reasons described. of different measures upon which to most appropriate reference point for
base the proposed adjustment and purposes of establishing the new
2. Use of CPI–U
future adjustments. DHS considered investment amount with respect to
Comments: Multiple commenters both the average household income and determining the present-day cost to the
provided input on the methodology average wage level as potential bases for investor.
used to calculate the proposed the proposed adjustments as the Some commenters recommended
investment amount increases or commenters suggested; however, both using average household income or
provided alternative approaches. only look at one factor to determine average wage level. The commenters
Several commenters stated that DHS inflation. DHS acknowledges that job stated that those measurements may
should increase the minimum creation outcomes depend on multiple better reflect the amount required to
investment amount by the annual create the requisite number of jobs.
factors in addition to the wage level.
household income growth rate because However, as stated above, DHS believes
Such factors may include, but are not
it is a better gauge of job creation over an adequately capitalized enterprise (as
limited to, the perceived level of
time than an unadjusted CPI metric and determined by the costs of goods or
economic stability and growth potential,
would better link the increase to job services required to do business) also
taxation, workforce availability, level of
creation. Another commenter strongly correlates to job creation, and
infrastructure development and price
commented that DHS should link the the CPI–U is valuable in this regard
stability.
investment amount increase to average because it is appropriately reflects the
DHS chose the unadjusted All Items
wage level because changes in wages change in costs of goods and services.
Consumer Price Index for All Urban
better show the amount required to DHS also believes it is appropriate to
Consumers (CPI–U) for the U.S. City
create the requisite number of jobs. adjust the minimum investment amount
Average (BLS CPI Series Id:
Other commenters stated that the upward based on inflation without
CUSR0000SA0) because it considers
increase should consider changes in directly correlating the minimum
multiple inflationary factors over
exchange rates since 1990, and how investment amount to the statutory
time.47 DHS appreciates that singular
those changes have affected foreign requirement to create a minimum of 10
investors. For instance, one commenter factors such as average wage and
jobs. As DHS stated in the NPRM,
stated that a $1 million investment income changes can reflect and
Congress did not provide for
would have cost 17 million Indian influence inflation, but because such
adjustments in the investment threshold
rupees in 1990, but would cost 65 factors are narrower in focus, DHS does
to be directly related to the EB–5 job
million Indian rupees in 2017. Another not believe that they translate to the
creation requirements.49 Indeed, the
commenter stated that the rule should overall cost of doing business in today’s
controlling statutory authorities permit
compare the value in U.S. dollars of the economy as well as the CPI–U does. The
varying investment amounts in various
currency of the country where the unchained CPI–U (BLS CPI Series Id:
circumstances (e.g., investment in TEAs
investor has earned or otherwise CUSR0000SA0) for all items is the
or high employment areas) while
accumulated his or her capital, because ‘‘broadest and most comprehensive
maintaining the requirement that 10
there are several countries where the CPI,’’ and is the most widely used
jobs be created.
current minimum investment amount is measure of inflation.48 Because the CPI– DHS also disagrees with comments
now higher than it was in 1990, in U is an indicator of the change in costs that suggest it should determine the
inflation-adjusted local currency. of goods and services necessary for impact of the minimum investment
Some commenters agreed with the use
47 CPI–U measures the average change over time

amount on the U.S. economy by
of CPI–U to calculate the proposed in the prices paid by urban consumers for a market considering the relative value of another
increase, but disagreed with calculating basket of consumer goods and services. Bureau of country’s currency, or the relative value
the increase from 1990. Some of these Labor Statistics, Consumer Price Index: Frequently of U.S. currency in other countries. The
commenters noted that the standard Asked Questions, available at http://www.bls.gov/ EB–5 program encourages investment in
cpi/cpifaq.htm; Bureau of Labor Statistics,
investment amount has never been Consumer Price Index: Addendum to Frequently the United States and thus it is
competitive. They stated that the TEA Asked Questions, available at http://www.bls.gov/
investment amount only became cpi/cpiadd.htm#2_1. (last accessed June 28, 2018). 49 82 FR at 4744.
appropriate to use the value of U.S. account for the 9,940 visas available a should not be automatic every five
currency in the United States as the year, solely because of the increase in years, but instead DHS should evaluate
focal point. Although some commenters the minimum investment amount, due whether an increase is appropriate at
claim that in many source countries, the to the numerous other factors involved, that time and how the increase would
contribution amount has gone up since including those that have led to higher affect investment and job creation.
1990 when their own currencies, utilization of the program since 2008. Response: DHS agrees with the
adjusted for inflation, are referenced, Notably, no commenters provided commenters who stated that it is
DHS believes it is more reasonable to concrete evidence to support the important to include a periodic
focus on the U.S. economy rather than speculation that demand would inflation-adjustment mechanism to
take into account currency value decrease so dramatically. avoid a recurrence of the current
fluctuations from certain source Finally, with respect to the situation, where the minimum
countries, or currency values commenter’s suggestion that an analysis investment amount remains unchanged
worldwide. DHS notes that the statute of the price elasticity of demand for the for a lengthy period and is eroded by
set specific minimum investment EB–5 visa would offer valuable inflation, and thus provides for
amounts that are meant to apply to all information regarding investor demand adjustment based on the change in the
investors. for the EB–5 visa and their price cumulative annual percentage change in
DHS also disagrees with calculating sensitivity, DHS observes that the CPI–U. DHS disagrees with basing the
the adjustment from a later year than commenter erroneously assumes DHS amount on the overall demand of the
1990. Commenters who recommend has access to certain data and can program, as the statute does not specify
using a later year rely on a supply and control certain variables. Since the that demand be the primary (or even a
demand rationale, arguing that the inception of the program in 1990, the necessary) factor in making a
investment amounts–or ‘‘price’’ of the required minimum investment amounts, determination to increase the minimum
program–only started to match demand for a standard investment or an investment amount. Moreover, demand
around 2008 or 2011, depending on the investment in a TEA, have never could fluctuate for a variety of reasons
commenter. As stated earlier, DHS changed. Calculating a price elasticity of outside of the minimum investment
disagrees that prior lower utilization of demand for the EB–5 visa would require amount and thus does not provide a
the program was due primarily to the that DHS know the ratio of the percent reliable, consistent metric that would
investment amounts being set too high. change in EB–5 visa demand to the permit USCIS and stakeholders to
Both the CIS Ombudsman and the GAO percent change in the investment anticipate adjustments (if any) to the
pointed out programmatic problems that amount. However, there are likely minimum investment amount for
contributed to the lower utilization of numerous factors that have influenced purposes of consistent adjudication and
the program. Therefore, DHS does not the growth of EB–5 investor investment structuring. Further, because
believe it is reasonable to assume that applications over the past several the minimum investment amount has
supply and demand reached decades. DHS cannot develop a model not been adjusted since the program’s
equilibrium simply due to the ‘‘cost’’ that controls for all of the specific inception, DHS does not have adequate
having dropped in present-day values; variables nor predicts future data to propose adjustment of the
rather, multiple factors contributed to unforeseeable events. DHS could not minimum investment amount based on
the program’s lower utilization in the accurately measure the influence of the the impact of such adjustments on
early years and its later two investment levels on demand for overall demand of the program.
oversubscription. DHS believes that past and future EB–5 investment
DHS also disagrees with the
calculating the increase to account for applications.
suggestion to evaluate how an increase
inflation from 1990 will ensure the
3. Adjustments Every Five Years Tied to would affect investment and job
program requirements reflect the
CPI–U creation prior to making future
present-day dollar value of the
Comments: Some commenters adjustments, rather than utilizing an
investment amount established by
supported increasing the minimum automatic increase. First, Congress did
Congress in that year.
Regarding commenters’ concern that investment amounts every five years. not explicitly tie the statutory
the increased investment amounts will One commenter agreed with the general investment amount to the aggregate
shrink demand for the EB–5 visa to concept of periodically increasing the level of investors, investment, or job
levels experienced in the 1990s and minimum investment amount to prevent creation. The statute contains only
early 2000s, DHS believes these past practice from repeating. One individualized requirements for each
suppositions fail to fully account for the commenter stated that applying the investor to invest the specified
range of factors that contribute to overall inflation in the U.S. economy to minimum amount of capital and create
demand (or lack thereof) for the the minimum investment amount every at least 10 jobs. It is therefore reasonable
program. As discussed in the sections in 5 years would compound the damaging for adjustments to the individual
the NPRM detailing potential benefits impact of raising the minimum investment amount to keep pace with
and costs, and now updated for this investment amount to $1.8 million now. inflation, as discussed elsewhere in this
Final Rule, DHS appreciates that the Another commenter suggested rule, rather than be tied to total
minimum investment amount is one key developing a different model that would investors, investment, or job creation.
factor that could affect utilization of the allow the minimum investment amount Moreover, DHS believes that an
program, and the increase in the to increase or decrease based on overall automatic adjustment based on CPI–U
demand for EB–5 immigrant visas and affords greater certainty for investment
minimum investment amount might

deter some investors, or otherwise make differences in demand between TEA decisions because stakeholders can
an investment under the EB–5 program and non-TEA investments (though this predict the level of adjustment on the
no longer affordable for some potential commenter acknowledged that the readily available CPI–U. As noted by the
investors. DHS does not anticipate, statute does not allow for decreases in Organization for Economic Co-operation
however, that the demand for the EB– the minimum investment amount below and Development (OECD):
5 visa will likely revert to 1990 levels, the statutory minimum). Two other The aim of policies for attracting foreign
or even fall to levels that fail to fully commenters suggested that an increase direct investment must necessarily be to
provide investors with an environment in Response: DHS considered phasing in commenter recommended that the TEA
which they can conduct their business the minimum investment amount over investment amount not be increased in
profitably and without incurring unnecessary the next five years, including increasing light of a recent GAO study, which
risk. Experience shows that some of the most
the amount every year or every other found that rural America only
important factors considered by investors as
they decide on investment location are: A year. However, DHS believes constantly accounted for 3 percent of the projects
predictable and non-discriminatory changing amounts would present under the EB–5 program. Some
regulatory environment and an absence of challenges to the EB–5 market, in that commenters said that an increased TEA
undue administrative impediments to continual, frequent increases would investment amount provides a
business more generally.50 commonly require different investment disincentive for the type of projects in
Given that uncertainty and perceived amounts for different petitioners within areas of high unemployment and rural
risk affect investment decisions, DHS the same investment project over a areas that the program should
believes that an automatic adjustment of period of time. Such differences would encourage, and would
the minimum investment amount that require frequent adjustments to offering disproportionately and negatively affect
occurs every five years provides documents that could overly complicate areas needing investment the most.
predictability and consistency to adjudications and place burdens on the Commenters proposed several
stakeholders so they can tailor business EB–5 market, including EB–5 alternative increases to the TEA
plans accordingly, without needing to petitioners. Most importantly, a phased- minimum investment amount. A
wait for DHS’ determination. in approach or transition period means commenter suggested investment levels
This rule also makes a technical the minimum investment amount would ‘‘somewhat less than’’ the levels
correction to the inflation adjustment not fully account for the change in proposed in recent legislation (e.g., H.R.
formula for the standard minimum inflation for another five years. DHS 5992, the American Job Creation and
investment amount and the high believes it is important to take steps to Investment Promotion Reform Act,
employment area investment amount, revise the program by making the which proposed a TEA minimum
such that future inflation adjustments adjustment now rather than continuing investment amount of $800,000)
will be based on the initial investment to delay the impact of the inflation- because such levels would not shock the
amount set by Congress in 1990, rather adjusted increase. investor market, would maintain the
than on the most recent inflation 5. Increase to the TEA Minimum competitiveness of the U.S. program
adjustment. Thus, for instance, the next Investment Amount relative to the costs of entry for similar
inflation adjustment will be based on investment-related immigration
the initial minimum investment amount Comments: Some commenters
programs in other nations, and could
of $1,000,000 in 1990, rather than this expressed support for the proposed
‘‘be reasonably supported by data
rule’s minimum investment amount of increase to the TEA minimum
investment amount from $500,000 to comparable to that cited by’’ another
$1,800,000, which is a rounded figure. commenter. The commenter did not
This change better implements the $1.35 million. A commenter stated that
the demand for EB–5 visas is high and identify which of the other commenter’s
intent of the proposed rule; it ensures data it found most relevant, and how
that future inflation adjustments more the program is oversubscribed, and a
higher minimum investment per visa data comparable to the other
accurately track inflation since 1990, commenter’s data would be used to
rather than being based on rounded will ‘‘increase the overall funding flow
and relieve some of the pressure/ support an $800,000 minimum
figures. investment amount.
challenge’’ to create 10 jobs per visa.
4. Implementation of the Increase in Many commenters stated that the One commenter suggested setting the
Investment Amount proposed TEA investment amount was TEA investment amount at $650,000
Comments: Multiple commenters too high. Many of these commenters now and gradually increasing the
provided suggestions on how to argued that the proposed increase amount to adjust for inflation. This
implement the increase in the minimum would be detrimental to the future commenter stated that the EB–5 market
investment amounts, with most of these viability of the EB–5 program, especially would not withstand an increase as
commenters advocating a phased-in in light of the fact that the vast majority dramatic as the one proposed; according
approach. One commenter suggested a of historical investments have been to the commenter, because the majority
transition period to ensure the made in TEA investments. Many of investments are currently made at the
minimum investment amount catches commenters made similar arguments $500,000 level, increasing the amount to
up to the ideal minimum investment against the proposal to increase the TEA $1.35 million will significantly reduce
amount without drying up access to minimum investment amount as they the investor pool and make the EB–5
capital. Other commenters made against the proposal to increase program an unattractive investment
recommended an incremental approach the standard minimum investment when compared with other countries.
because the market responds better to amount, such as: The proposed increase Other commenters suggested TEA
smaller increases over time rather than would make the EB–5 program less minimum investment amounts ranging
a single increase, and it would also competitive with the immigration from $600,000 to $1 million, similarly
minimize disruptions in EB–5 program investment programs of other countries; arguing that the proposed investment
activity. Several commenters the proposed increase would result in amounts are too high.
encouraged DHS to implement a minimum investment amounts far One commenter argued for applying
reasonable, stepped increase over the exceeding those under consideration by an inflation-based increase to the TEA
Congress; the proposed increase would minimum investment amount, rather
next 5 years.
have the unintended consequence of than the standard investment amount,
50 Christiansen, Hans, Checklist for Foreign Direct severely limiting the participation of so that the TEA minimum investment
Investment Incentive Policies, Investment and many successful mid-career amount would be $900,000. The
Services Division, OECD Committee on professionals and entrepreneurs; and commenter argued that if a further
International Investment and Multinational
Enterprises (CIME) OECD, 2003, available at
the proposed increase would especially policy goal is to reduce the TEA versus
https://www.oecd.org/daf/inv/investment-policy/ burden investors from China due to non-TEA differential to 25 percent
2506900.pdf. currency control restrictions. Another instead of the current 50 percent, then
the minimum for non-TEA investment differential between the TEA and non- high unemployment, but disagrees that
amount would become $1.2 million. TEA investments, are the primary tools this rule will discourage investment in
Response: DHS considered the that Congress gave the administering such areas. On the contrary, DHS
comments received on this proposed agency to achieve this goal.53 believes that the changes made in this
change and, for the reasons explained in Ultimately, DHS believes in a rule to the TEA investment amounts and
the Investment Level Differential meaningful incentive to invest in rural the TEA designation process will
Between Standard Investment Amount areas and areas of true high- increase total investment in rural and
and TEA Investment Amount section unemployment, and thus, upon careful high unemployment areas. As discussed
below, it will retain the 50 percent consideration of the comments related in greater detail below, the changes to
differential between TEA and non-TEA to this issue, DHS opted to retain the the TEA designation process made by
investment amounts. differential between TEA and non-TEA this final rule will help ensure that areas
DHS agrees with commenters who investments at 50 percent. eligible for the lesser investment
supported the proposed increase to With regard to commenters’ amounts as areas of high unemployment
$1.35 million in that DHS also believes suggestions that the current utilization are actually areas of high
a higher minimum investment per visa and oversubscription of the program are unemployment. DHS also maintains the
would ‘‘increase the overall funding mainly a result of the fact that presently 50 percent investment level differential
flow and relieve some of the pressure/ a significant number of investors can between the TEA minimum investment
challenge’’ to create 10 jobs per visa. afford to invest at the TEA level amount amount and the standard minimum
DHS notes that an increase from of $500,000, DHS believes that investment amount—rather than
$500,000 to $900,000, though not as minimum investment levels represent reducing it to 25 percent as proposed—
high as $1.35 million, will have a only one of a range of factors that likely in order to continue to incentivize
similar benefit. influence demand for the program, investments in TEAs. DHS believes that
Many commenters, however, asserted including as compared to other the increase in the minimum investment
that the proposed minimum investment countries’ investor visa programs. amount in TEAs, while less than
amount for TEAs was too high, or higher Commenters did not discuss other proposed, and the reforms to the TEA
than Congress has considered in recent factors, referenced earlier in this designation process will result in more
legislation. The proposed increase in the preamble, that likely account for the overall infusion of capital into rural and
minimum investment amount for TEAs program’s current and past utilization. high unemployment areas.
was intended in part to remedy the DHS considered commenters’ other DHS considered the alternatives
imbalance referred to in comments, objections that repeated those expressed proposed by commenters for the level of
where the vast majority of investments regarding the increase to the standard the TEA minimum investment amount,
are currently in entities in TEAs, minimum investment (the increase will such as setting the amount at a number
contrary to the balance Congress make the EB–5 program less competitive ranging from $600,000 to $1 million.
appears to have expected.51 While DHS against the immigration investment However, having determined to increase
continues to have some concern about programs of other countries; the the standard minimum investment to
the imbalance, the reforms to the increase represents amounts far $1.8 million based on the CPI–U
designation process for high exceeding those under consideration by inflation rate for reasons explained
unemployment TEAs finalized in this Congress; the increase would have the elsewhere in this preamble, investments
unintended consequence of severely in TEAs below $900,000 are not
rule will better ensure that, even if some
limiting the participation of many permissible under the controlling
imbalance remains, it is benefiting truly
successful mid-career professionals and statute.
deserving communities, as Congress DHS also disagrees with the proposal
intended. Also, it should be kept in entrepreneurs; and the increase would
especially burden investors from China to first adjust the TEA minimum
mind that Congress set aside thousands investment amount for inflation, and
of EB–5 visas a year for those investors due to currency control restrictions).
DHS disagrees with these commenters then determine the standard minimum
(and their immediate family members) investment amount based on that. In the
investing in TEAs. In fact, while no less for the same reasons stated earlier in
this preamble.54 DHS likewise disagrees statute, Congress set the standard
than 3,000 visas must be so set aside minimum investment amount and gave
each year, Congress left DHS with the with the commenter suggesting that the
DHS the authority to increase it. With
discretionary ability to set aside even TEA minimum investment should be
respect to targeted employment areas,
more.52 Congress did not reserve visas implemented gradually for the same
Congress authorized DHS to specify a
for investors investing in non-TEA reasons described earlier in this
minimum investment amount that is
projects. These features of the program preamble related to phasing-in the
less than, but no less than half of, the
provide additional indication that standard minimum investment amount.
DHS agrees with commenters who standard amount. Consistent with the
Congress considered the goal of mechanism for determining TEA
incentivizing investments in rural and assert that not enough EB–5 investment
has gone to rural areas and areas of truly minimum investments under the
high-unemployment areas of crucial authorizing statute, in this final rule
importance. This set-aside, along with DHS initially sets the standard amount
53 Congress also gave DHS the ability to set the
the provision authorizing DHS to and then establishes a lesser minimum
minimum investment amount in non-rural areas
institute a substantial investment with very low unemployment rates at up to three investment amount for targeted
times the standard minimum investment amount employment areas. INA section
51 See 136 Cong. Rec. S36,615 (Oct. 26, 1990) (or up to $5,400,000 under the revised initial
(statement of Sen. Simon). Senator Simon stated: minimum investment amounts under this rule).
203(b)(5)(C), 8 U.S.C. 1153(b)(5)(C). In
‘‘The general rule-and the vast majority of the Section 203(b)(5)(C)(iii) of the INA. This tool has addition, if the minimum investment
investor immigrants will fit in this category-is that never been utilized, but would be an option to amount for TEAs were adjusted for
the investor must invest $1 million and create 10 explore in the future. inflation first and the 25 percent
U.S. jobs,’’ but he was also ‘‘mindful’’ of the need 54 DHS also received comments on the investment
differential were maintained, as the
to target investments in rural areas and noted that level differential between the standard minimum
the higher the differential, the more encouragement investment amount and minimum investment
commenter suggests, the differential
there would be to invest in TEAs). amount for TEAs, which will be addressed in the between the two investment tiers would
52 Section 203(b)(5)(B)(i) of the INA. following section. have been only $300,000, which is
appreciably smaller than the differential capital’’ between TEA and non-TEA gerrymandered as discussed below.55
initially proposed ($450,000). As investments. DHS was also concerned that
discussed further below, the $300,000 Other commenters recommended that maintaining the 50 percent differential
differential could reduce the incentive the current 50 percent differential may result in too large of a dollar
to invest in TEAs. Therefore, the final should be maintained. One of these difference that may create unintended
rule applies the CPI–U-based increase to commenters argued that a substantial distortions in investment decisions, and
the standard minimum investment first. differential is essential as an effective that maintaining the differential at a
Id. incentive to make investments in TEAs, dollar amount similar to the one that
While DHS disagrees with some of the and that a substantial differential previously existed ($500,000 to
commenters’ bases for setting the reflects congressional intent. Another $450,000) could soften the impact of the
minimum investment amount for a TEA, multiple changes that will impact TEA
commenter stated that the rule should
DHS will ultimately set the amount investments. Thus, DHS settled on a
maintain the 50 percent differential
lower than proposed for the reasons midpoint between the maximum
between TEA and non-TEA minimum
discussed below. The final rule does not discount allowed by Congress of 50
investment amounts, or at the very least
reduce the differential between the percent, and no discount at all.
maintain the $500,000 differential by DHS continues to recognize that
standard minimum investment amount raising the minimum investments
and the TEA minimum investment addressing the imbalance between TEA
amounts to $750,000 in a TEA and $1.25 and non-TEA investments is
amount from 50 percent to 25 percent as million outside of a TEA (which would
proposed. Rather, this final rule sets the worthwhile; however, it must balance
represent a 40 percent differential). that concern with a continued interest
TEA minimum investment amount at Several commenters felt that revisions
$900,000, making the difference in providing a strong incentive to attract
to the designation of a high investments to rural areas and areas of
between the two investment tiers unemployment TEA would be effective
$900,000. true high unemployment under the
in directing funds to rural and high modified TEA designation standards, in
6. Investment Level Differential unemployment areas without changing order to promote those congressional
Between Standard Investment Amount the differential between the two aims. As noted by one of the
and TEA Investment Amount minimum investment amount levels. commenters, the NPRM quoted Senator
Comments: Some commenters One commenter agreed with DHS that Rudolph Boschwitz and Senator Paul
expressed support for the proposed the 50 percent differential between the Simon, both of whom expressed in 1990
standard investment amount and the the importance of attracting investment
investment level differential, reasoning
TEA investment amount has not struck to rural locations and areas with
that it will maintain a meaningful
the balance that Congress intended, but particularly high unemployment.56
incentive for foreign investors to invest
believes DHS’s proposed solution to this Notably, Senator Simon stated that the
in a TEA. One commenter stated that
problem would substitute one static lower the investment level for TEAs, the
the adjustment to a TEA minimum
differential for another, which is not more encouragement there would be for
investment amount that is 75 percent of
nearly as market driven as what the investments in those areas.57 The same
the standard minimum investment
commenter would propose to be commenter quotes an April 6, 2017
amount will continue to attract
implemented—a changeable differential letter from Senator Charles Grassley and
investors to investments in TEAs since
(the commenter acknowledged that such other lawmakers to Senator Mitch
the relative proportion of EB–5 McConnell and others identifying rural
investments that are made in TEAs is a differential would require
congressional action). This commenter and distressed urban areas as ‘‘the very
already very high. Multiple commenters communities this program was
stated that the differential between the also encouraged DHS to support
legislative resolution of this issue, originally intended to benefit.’’ 58 DHS
standard minimum investment amount finds the comment that a substantial
and the minimum investment amount contending that such solutions would
be much more effective in improving differential is essential as an effective
for TEAs should be decreased to incentive to make investments in TEAs,
encourage non-TEA investments. the program’s reputation and
operability. and that a substantial differential is
Referencing anecdotal evidence, a consistent with congressional intent, to
commenter recommended a differential Response: After reviewing the
be persuasive. DHS also feels that
no greater than $200,000 to create an comments, DHS decided that the final
active market for non-TEA investments rule should maintain the 50 percent 55 Cf. 136 Cong. Rec. S35,615 (Oct. 26, 1990)
and demand at both price points. minimum investment amount (statement of Sen. Simon) (‘‘The general rule—and
Another commenter recommended that differential between TEAs and non- the vast majority of the investor immigrants will fit
TEAs. In order to address the imbalance in this category—is that the investor must invest $1
the percentage discount for TEAs million and create 10 U.S. jobs.’’).
should be no more than 20 percent as between TEA and non-TEA 56 See 135 Cong. Rec. S7858–02 (July 13, 1989)
the only way to make a non-TEA investments, DHS had originally (statement of Sen. Boschwitz that the amendment’s
investment feasible. One commenter proposed reducing the differential purpose was to ‘‘attract significant investments to
recommended that the minimum between the investment amounts to 25 rural America.’’); 136 Cong. Rec. S35,615 (Oct. 26,
percent in addition to changing the way 1990) (statement of Sen. Simon: ‘‘[W]e are mindful
investment amount for a TEA of the need to target investments to rural America
investment should be two-thirds of the certain high unemployment TEAs are and areas with particularly high unemployment—
standard minimum investment amount, designated. DHS was concerned that areas that can use the job creation the most . . .
but did not supply any data to support maintaining the current differential of America’s urban core and rural areas have special
50 percent, a reduction of $900,000 from job creation needs.’’)

this differential. 57 Id.
Another commenter recommended a the increased standard investment 58 Letter from Senator Grassley, Senator Leahy,
more gradual decrease in the relative amount, might not adequately correct Senator Feinstein, Representative Goodlatte, and
difference between the standard the current imbalance between TEA and Representative Conyers to Senator McConnell,
non-TEA investments where the vast Speaker Ryan, Senator Schumer, and
minimum investment amount and the Representative Pelosi (Apr. 6, 2017), available at
TEA minimum investment amount to majority of investments are in TEAs, https://d2xxqpo46qfujt.cloudfront.net/downloads/
‘‘reduce the severity of the shift of many of which have been criticized as letter-to-leadership.pdf.
maintaining the 50% differential is rate,’’ these projects would have had to cities and towns with populations less
responsive to commenters who show an unemployment rate of in the than 20,000 that can currently qualify
suggested lower differentials and neighborhood of 7.725 percent.61 through state designation. The
discounts, as well as commenters who Accordingly, if DHS had looked at the commenter further added that the
suggested gradual implementation of the actual physical location of the projects, proposal mistakenly confused the
differential change, since the differential few would have qualified as being in population criteria for TEAs because the
will no longer be changing over time. high unemployment areas. 20,000 population requirement pertains
Further, DHS is satisfied that the reform Congress authorized DHS to create a to cities and towns residing in counties
to TEA designations and the move away multi-leveled investment framework outside of MSAs that do not meet the
from deferring to state TEA designations with different minimum investment requirements for rural TEA status. The
will address the concerns about amounts for investments in TEAs. This commenter stated the population
gerrymandering that contribute to the final rule retains the current 50 percent criteria should be 25,000 and not 20,000
imbalance between TEA and non-TEA differential between TEA and non-TEA because BLS data is only published for
investments: That investors may choose investment amounts. DHS believes it is cities and towns with populations of
TEA investments because the reasonable to conclude, as a matter of 25,000 or more.
designated areas are affluent, due to common sense, that the revisions to the Response: DHS disagrees with the
gerrymandering. It is possible that the high unemployment TEA designation commenter opposing this proposal but
percentage of petitioning investors standards and process finalized in this recognizes that the proposal was
seeking to invest in projects in TEAs rule will likely ameliorate the current inadvertently over-inclusive, because
will decrease simply because they no imbalance between TEA and non-TEA DHS intended the proposal to provide
longer will have the ability to invest in investments, although some investors additional options for non-rural cities
projects in affluent areas and at the may continue to favor investments in and towns outside of MSAs to qualify as
same time reap the benefits of investing more affluent urban areas. Even if the a TEA. DHS did not intend to create an
in TEA areas. The GAO found that of a imbalance remains, keeping the current additional option for cities and towns
random sample of petitioning investors 50 percent differential for TEA within MSAs. And DHS did not intend
(filing petitions in the fourth quarter of investments will benefit the areas to create an artificial distinction
fiscal year 2015) investing in high- intended by Congress by preserving the between cities and towns within MSAs
unemployment TEAs, 90% were incentive for investments in rural and that have a population of 20,000 or
investing in projects that relied on high unemployment areas. DHS more, on the one hand, and cities and
combining census tracts or census block acknowledges the commenter’s concern towns within MSAs that have a
groups.59 GAO also found that, for those that a static differential is not market population under 20,000, on the other.
petitioners that elected to invest in a driven. DHS also notes that this final The current regulations do not contain
high unemployment TEA, the rule in no way affects Congress’s ability such a distinction.
to pursue a legislative change, for which Accordingly, the final rule only
unemployment rate in the census
the commenter advocated. finalizes a portion of the proposal. The
tract(s) where the projects were
final rule allows designation of cities
physically located was: D. Revisions to the Targeted and towns with a population of 20,000
• 0–2% in 7% of EB–5 petitioners, Employment Area (TEA) Designation or more outside of MSAs as a specific
• greater than 2–4% in 29% of EB–5 Process and separate area that may qualify as a
petitioners, TEA based on high unemployment. See
• greater than 4–6% in 41% of EB–5 1. Standards Applicable to the
Designation of a TEA final 8 CFR 204.6(j)(6)(ii)(A). DHS is not
petitioners,
• greater than 6–8% in 12% of EB–5 finalizing the aspect of the proposal that
1.1. Proposal To Allow Designation of a
petitioners, allowed such designation for cities and
City or Town With High Unemployment
• greater than 8–10% in 3% of EB–5 towns with a population of 20,000 or
and a Population of 20,000 or More
petitioners, more within an MSA. The statute
Comments: Several commenters expressly excludes cities and towns
• greater than 10–12% in 3% of EB–5
discussed the proposal to allow cities with populations of 20,000 or more as
petitioners, and
• greater than 12% in 6% of EB–5 and towns with a population of 20,000 well as MSAs from qualifying as ‘‘rural’’
petitioners.60 or more to be independently designated TEAs and existing regulations have
as a TEA if the average unemployment permitted MSAs to independently
Joint commenters noted that GAO’s
rate for the city or town is at least 150 qualify as TEAs based on high
findings indicate that only 12 percent of
percent above the national average. unemployment, but non-rural cities and
EB–5 petitioners that qualified for the
Most of these commenters supported the towns with a population of 20,000 or
lower investment amount based on
proposal. Two commenters stated this more outside of MSAs have had only
being in high-unemployment TEAs were
was a logical extension of the current one expressly identified means to
actually investing in projects physically
policy. One commenter said that setting qualify as TEAs, i.e., based on the
located in census tracts with
clear guidelines will help clear up unemployment levels of the county in
unemployment rates of greater than 8
discrepancies and inconsistencies in the which they are located.62 In order to
percent. However, the national
EB–5 immigration process. One
unemployment rate in the fourth quarter
commenter stated that the addition of 62 Under the current regulatory framework, cities
of 2015 averaged 5.15 percent. The
municipalities will lead to robust and towns with a population of 20,000 or more
commenters stated that given that, inside an MSA can qualify as a high unemployment
economic growth and opportunities for

under section 203(b)(5)(B)(ii) of the INA, area through either their county or their MSA.
communities that need it most. One However, cities and towns with a population of
‘‘high unemployment’’ means ‘‘at least
commenter opposed to the proposal 20,000 or more outside an MSA can qualify as a
150 percent of the national average
contended that the proposal limits areas high unemployment area only through their county.
that can independently qualify as TEAs Under the final rule, cities and towns with a
59 GAO, Immigrant Investor Program: Proposed
population of 20,000 or more will each have two
Project Investments in Targeted Employment Areas, by removing the TEA possibility for all options to qualify as a high unemployment—
GAO–16–749R, at 7 (figure 2) (Sept. 19, 2016). through the county or MSA if inside an MSA or
60 Id. at 8 (table 1). 61 Id. through the city/town or county if outside an MSA.
address this lack of parity with respect included in an MSA ‘‘contain both project necessarily spans multiple
to TEA options available to NCEs urban and rural territory and census tracts, counties, and state
principally doing business in non-rural populations.’’ 64 The commenter boundaries. One commenter said the
areas outside of MSAs, DHS is finalizing suggested replacement text for 8 CFR TEA definition should be expanded to
the rule to expressly include cities and 204.6(j)(6)(i). include an area that is within the
towns with a population of 20,000 or Response: DHS disagrees with the boundaries of a state or federally
more outside of MSAs as a specific and commenters. The agency is bound by defined economic development
separate area that could independently the statutory framework established by incentive program, as each of these
qualify as a TEA if the average Congress in 1990 when it defined a designations is based on a multi-
unemployment rate is at least 150 ‘‘rural area’’ for TEA designation variable formula. Another commenter
percent of the national average. See final purposes as ‘‘any area other than an asserted that some states have rural
8 CFR 204.6(j)(6)(ii)(A). area within a metropolitan statistical cities with populations as low as a few
Under the EB–5 statute, cities and area or within the outer boundary of hundred residents each, but that these
towns with a population of 20,000 or any city or town having a population of cities fail to qualify for the rural TEA
more cannot qualify as ‘‘rural’’ TEAs, 20,000 or more’’. 8 U.S.C. designation because they sit on the
INA section 203(b)(5)(B)(iii), 8 U.S.C. 1153(b)(5)(B)(iii); INA 203(b)(5)(B)(iii). outskirts of a county that falls within a
1153(b)(5)(B)(iii), and DHS believes that Although, arguably, MSAs may include large MSA. The commenter suggested
maintaining the population criterion at rural territory and populations, for that the rule discriminates against rural
20,000 for cities and towns outside of purposes of the EB–5 program and this cities that happen to be in bigger states,
MSAs to qualify as a high regulation, DHS will continue to mirror and argued that ‘‘a rural city should be
unemployment area TEA comports with the statutory language. The final rule a rural city’’ no matter where it is
the overall statutory framework. revises the existing regulatory text to located. One commenter stated that TEA
Additionally, while DHS appreciates the conform with that statutory framework opportunities could be expanded by
comment regarding data availability as interpreted by the agency. See final granting rural TEA status to all census
from the Bureau of Labor Statistics, DHS 8 CFR 204.6(e). Further, this final rule tracts not within an urbanized area with
further notes that publicly available in no way adversely affects Congress’s a population of 50,000 or more, as
unemployment data for those cities or ability to enact relevant legislation. defined by the most recent decennial
towns with a population between With respect to consistency between the census data, if the individual census
20,000 and 25,000 can be found within definition of ‘‘rural area’’ at 8 CFR tract meets a predetermined minimum
other government sources of 204.6(e) and (j)(6)(i), the final rule size and maximum population density
unemployment data, such as the U.S. revises the definition of ‘‘rural area’’ at criteria, such as greater than 100 square
Census Bureau’s American Community 8 CFR 204.6(e) to be consistent with miles and population density of fewer
Survey (ACS).63 both the existing and revised regulations than 25 people per square mile. Another
Lastly, DHS notes that other at 8 CFR 204.6(j)(6)(i). DHS appreciates commenter suggested the definition
geographic areas with high the commenter’s proposed changes to 8 could be broadened to include regions
unemployment that are not specifically CFR 204.6(j)(6)(i), but believes the with high level of rent burden or
mentioned above and in the final rule revisions to the definition of ‘‘rural provide flexibility on the job creation
can pursue TEA designation through the area’’ at 8 CFR 204.6(e) achieves requirement if the investor provides
census tract approach. consistency between applicable affordable housing in the development.
regulatory requirements without Another commenter stated that TEA
1.2. Definition of Rural Area
disturbing the existing agency status should only be given to rural and
Some commenters commented on interpretation as found in both the high poverty areas in the urban MSAs.
DHS’s proposed amendment to the current and revised regulatory Some of these commenters opposed the
definition of ‘‘rural area’’ clarifying that requirements at 8 CFR 204.6(j)(6)(i). entire idea of a TEA. These commenters
qualification as a rural area is based on
1.3. Alternative Proposals for How To suggested that the non-TEA investment
data from the most recent decennial
Designate a TEA amount has never been competitive and
census of the United States. One
that visa set-asides would provide the
commenter supported the proposed Several commenters offered
necessary incentives for rural and
clarification on the definition of ‘‘rural alternative proposals for TEA
distressed urban areas.
area.’’ definitions for purposes of designation.
Comments: Some commenters stated Comments: A couple of commenters Response: DHS is bound by the
that there has been a larger legislative indicated that public infrastructure statutory definition of a TEA and rural
discussion about the definition of what projects, where the borrower and area at section 203(b)(5)(B) of the INA
qualifies as ‘‘rural’’ for purposes of a beneficiary of the EB–5 capital is solely and DHS cannot redefine a TEA in a
TEA, and accordingly, that ‘‘regulatory a governmental body, should be manner that is inconsistent with these
discussion should be held’’ until a automatically included in the definition statutory parameters. The statute defines
legislative resolution is enacted. of a TEA. These commenters were a TEA as a ‘‘rural area or an area which
Another commenter said proposed 8 concerned that without expressly has experienced high unemployment (of
CFR 204.6(j)(6)(i) must be revised for designating public infrastructure at least 150 percent of the national
consistency with the definition of ‘‘rural projects as TEAs, use of the EB–5 average rate)’’ and, in turn, defines rural
area’’ that appears in both Section 203 program by public infrastructure area as ‘‘any area other than an area
within a metropolitan statistical area or
of the INA and the substantive projects could be hampered because the
definition of ‘‘rural area’’ at 8 CFR within the outer boundary of any city or
204.6(e), as well as an Office of 64 OMB, Revised Delineations of Metropolitan town having a population of 20,000 or
Management and Budget (OMB) Statistical Areas, Micropolitan Statistical Areas, and more (based on the most recent
Combined Statistical Areas, and Guidance on Uses decennial census of the United States).’’
directive that states that many counties of the Delineations of These Areas, OMB Bulletin
No. 15–01 (July 15, 2015), available at https://
While several comments suggested areas
63 Available at https://www.census.gov/programs- obamawhitehouse.archives.gov/sites/default/files/ that may be in need of investment,
surveys/acs/geography-acs/areas-published.html. omb/bulletins/2015/15-01.pdf. Congress set the parameters within
which DHS may define a TEA; the final more encouragement there would be for all opposed the proposal to shift all TEA
rule fits within the statutory framework. investments in those areas.65 designation from the states to USCIS.
Each of the different alternative criteria The commenter cites to a publication Comments: Several commenters
suggested are not reasonable by Jeanne Calderon and Gary Friedland provided support for the proposal to
interpretations of the statute because of New York University’s Stern School shift the TEA designation authority from
they either (1) are not limited to areas of Business, who state that the states to DHS as written. Several of
as defined by the statute (public these commenters supported the
[T]he two essential ingredients to a
infrastructure projects focus on meaningful TEA incentive are (1) a narrowly proposal because it would standardize
activities rather than areas), (2) are defined area that limits the number of and streamline the TEA designation
contrary to the existing statutory projects that may qualify for the TEA process, provide much needed
definitions (smaller cities and towns in discount, and (2) a sufficiently wide TEA transparency, and align the TEA
outlying areas of a county within an spread between the minimum amount designations process with congressional
MSA are still within an MSA and thus required for a TEA project location and other intent. One commenter noted that most
cannot be rural), or (3) contain criteria location.66 TEA projects are not actually located in
that go beyond those mandated by the DHS agrees with the commenter that rural or economically distressed areas
statute (high rent burden, high poverty although the reforms to high because states have had such a high
(or low income) areas and population unemployment TEA designation and degree of flexibility to designate a TEA.
density are not based on unemployment process address the first ingredient, Many commenters argued that the states
or absolute population and areas with a reducing the differential undermines the have the most expertise with local
population of 50,000 or more exceeds second ingredient. Thus, in the final employment and unemployment data,
the population criterion of 20,000 or rule, DHS maintains a 50 percent as well as knowledge of local
more set by statute). For USCIS to base differential between the TEA investment demographics and economies to make
TEAs on economic indicators other than amount and non-TEA investment TEA designation determinations. In
unemployment data or to allow local amount in order to encourage addition, some commenters indicated
designations based on such indicators development outside of affluent areas their appreciation of working with local
would require a statutory change. and increase investment in TEAs. officials and that such coordination has
Finally, while DHS has the discretion to mutual benefits for the project and the
Additionally, many TEAs have been
adjust the minimum investment amount local economic development agencies,
criticized as being ‘‘gerrymandered’’ to
for investments within TEAs, the statute which they felt would be lost if states
qualify for the reduced threshold
nonetheless reserves 3,000 visas for were removed from the designation
amount.67 DHS believes the best
investment into TEAs and, therefore, process. One commenter stated that a
solution to deter ‘‘gerrymandered’’ TEAs
DHS may not eliminate TEAs entirely. state-based perspective is more likely to
and to more effectively utilize the
See INA sec. 203(b)(5)(B)(i), 8 U.S.C. capture an accurate reality of
congressionally mandated TEA
1153(b)(5)(B)(i). unemployment and the rural conditions
incentive is to reform both the TEA
of Indian tribes.
1.4. Other Comments on the Proposed definitions and designation process Response: DHS recognizes that states
Standards for Designating TEAs while maintaining the 50 percent may possess expertise in local
differential. DHS believes these changes demographics and economies and that
Comment: One commenter stated that will more optimally incentivize targeted
the proposal aims to tighten the TEA states may play an important role in
investment into areas of need that facilitating EB–5 projects. However,
definition, but hobbles the TEA Congress sought when establishing the
incentive by decreasing the monetary DHS must weigh such expertise against
TEA provisions of the EB–5 program. transparency in TEA designations and a
differential between TEA and non-TEA
investment amounts. The commenter 2. Proposal To Eliminate State state’s natural self-interest in promoting
stated that industry studies indicate that Designation of TEAs economic development.68 This self-
tightening the TEA definition could, by interest has resulted in the application
Multiple commenters discussed the
itself, have the effect of making a of inconsistent rules for designation of
proposed shift of TEA designation from
majority of EB–5 projects subject to the high unemployment areas by the states.
the states to DHS. Of those, most but not
standard investment level. The This inconsistency results in acceptance
commenter mentioned one study that of TEAs that are criticized as
65 See 136 Cong. Rec. S35,615 (Oct. 26, 1990)
notes that over 80 percent of EB–5 (statement of Sen. Simon).

‘‘gerrymandered.’’ 69 TEA designations
projects in the study’s database of large- made by states under the existing
66 Gary Friedland and Jeanne Calderon, EB–5
scale EB–5 projects would not qualify as system thus do not reliably fulfill the
Prescription for Reform: Legislation or Regulation?,
a TEA by solely changing the TEA NYU Stern School of Business, June 19, 2017, page congressional intent of the program to
standard for special designations of high 11 available at http://www.stern.nyu.edu/sites/
default/files/assets/documents/EB- 68 The Distortion of EB–5 Targeted Employment
unemployment areas. 5%20Prescription%20for%20Reform%20- Areas: Time to End the Abuse: Hearing Before the
Response: DHS agrees with the %20Legislation%20or%20 S. Comm. On the Judiciary, 114th Cong. 12 (2016)
commenter that decreasing the Regulation%206.19.2017%20draft.pdf. (statement by Gary Friedland, Scholar-in-Residence,
monetary differential between TEA and 67 For instance, one industry participant N.Y. Univ., Stern School of Bus.) (‘‘Compounding
expressed a belief that a clear majority of EB–5 the problem, often the state agency that is charged
non-TEA investment amounts capital was going to projects relying on ‘‘some form with making the TEA determination is the same
undermines the incentive to invest in of gerrymandering’’ to qualify for the reduced agency that promotes local economic
TEAs. As discussed above, Senator minimum investment requirement. Eliot Brown, development.’’) .
Rudolph Boschwitz and Senator Paul ‘‘How a U.S. Visa-for-Cash Plan Funds Luxury 69 See, e.g., ‘‘Eliot Brown, Swanky New York
Apartment Buildings; Program Meant to Spur Jobs Condo Project Exploits Aid Program,’’ Wall St.
Simon both expressed in 1990 the in Poor Areas Largely Finances Developments in Journal, Oct. 13, 2015, http://www.wsj.com/articles/
importance of attracting investment to Affluent Neighborhoods,’’ Wall St. J., Sept. 9, 2015, posh-tower-proposed-for-struggling-new-york-
rural locations and areas with available at https://www.wsj.com/articles/how- neighborhood-central-park-south-1444728781;
particularly high unemployment. immigrants-cash-funds-luxury-towers-in-the-u-s- Patrick McGeehan and Kirk Semple, ‘‘Rules
1441848965 (last visited Dec. 17, 2018) (citing Stretched as Green Cards Go to Investors,’’ New
Notably, Senator Simon stated that the Michael Gibson, managing director, York Times, Dec. 18 2011, available at https://
lower the investment level for TEAs, the USAdvisors.org). nyti.ms/2FgZoQq.
incentivize the investment of EB–5 provide a TEA designation in two weeks petitioners to determine on their own
capital in actual high unemployment or less. The commenter questioned whether the proposed location is a TEA
areas. To better adhere to this DHS’s ability to process TEA requests in by reviewing the census tract and, if
congressional intent, DHS believes the under 30 days, which the commenter necessary, the adjoining tracts.
EB–5 program is best served by shifting claimed is what would be required to This rule does not establish a separate
the designation of high unemployment make the system viable. One commenter application or process for obtaining TEA
areas from the states to DHS. noted that developers often seek designation from USCIS prior to filing
DHS also rejects the commenter’s multiple TEA designation letters from the EB–5 immigrant petition and USCIS
assertion that states are better states as part of their due diligence, will not issue separate TEA designation
positioned to determine the further compounding the adjudication letters for areas of high unemployment.
unemployment of Indian tribal areas. demands on DHS. One commenter DHS will make the determination as
The commenter failed to provide any expressed concern about resources at part of the existing adjudication process
data to support the claim that a state- USCIS being moved from Form I–526 and does not anticipate an impact to the
based perspective is more likely to and Form I–829 adjudications to TEA overall timing of the adjudication
capture an accurate reality of designation determinations, which process.
unemployment in and the rural would further increase petition backlogs DHS recognizes that this final rule
conditions of Indian tribal areas. The for all EB–5 forms. Two commenters represents a shift from the current
U.S. Census Bureau conducts outreach said it is unclear whether there will be process by which designations of certain
to Indian tribes to collect information, any ability for TEA designations to be high unemployment areas may be
including unemployment rates, from made prior to adjudication of the Form obtained from states in advance of
Indian tribes.70 I–526 petition or Form I–924 filing. If a regional center prefers to seek
Comment: One commenter stated that application. The commenters stated that TEA determination in advance of
because USCIS adjudications of TEA TEA designations should be available to investor petition filings, the regional
designations are not within the agency’s projects prior to filing of the Form I–526 center may file an exemplar application
area of immigration-law expertise, such or Form I–924. One commenter stated as part of a Form I–924 adjudication. If
adjudications would not receive that DHS should allow the filing of the exemplar application is approved,
deference under Chevron USA v. Forms I–924 and Forms I–526 while a the approval (including the TEA
Natural Resources Defense Council, TEA designation is pending, arguing determination) will receive deference in
Inc., 467 U.S. 837 (1984), if challenged that if the DHS process is uniform and individual investor petition filings
in federal court. The commenter predictable, investors and market associated with that exemplar in
suggested that the possibility of participants can proceed on an efficient accordance with existing USCIS policy
litigation over such adjudications was (for example, absent a material change
parallel track to expedite projects.
‘‘another reason to give serious in facts affecting the underlying
consideration to allowing the states to Response: The framework detailed in favorable determination or its
retain the authority to make [TEA] the NPRM and finalized in this rule applicability to eligibility for the
determination[s].’’ should not add a significant additional individual investor). For non-regional
Response: DHS disagrees with the burden to petitioners or to DHS in the center investors, unemployment data is
commenter’s interpretation of the case adjudication process. DHS is committed readily available by which they can
law, but in any case has elected to move to providing timely TEA designation determine if an investment in a
forward with its proposal for the reasons decisions as part of the adjudication particular area satisfies applicable TEA
expressed elsewhere in this preamble. process. DHS does not foresee an designation requirements. As a result of
Comments: Some commenters increase in petition backlogs based on the clearer, more objective designation
expressed concerns about the impact of handling high unemployment area standards under this final rule, this rule
the proposal on processing times. Some designations as the agency already should provide sufficient certainty
commenters argued that states have the reviews state designation evidence regarding the amount and timing of an
resources and capacity to process high provided by petitioners As in the investment to establish eligibility when
unemployment designation letters current process, EB–5 petitioners will be filing their petitions.
relatively quickly, whereas shifting the required to provide evidence to DHS notes that this change
high unemployment designation demonstrate the area in which the new harmonizes the process for all types of
authority to DHS would exacerbate commercial enterprise into which they TEAs—including rural areas, for which
processing backlogs and delay are investing is principally doing no preliminary determination process
investments and project progress. Some business is a TEA. The new framework, exists. In any event, if necessary, DHS
commenters explained that DHS must while implementing a new could raise associated fees to bring on
be committed to a speedy TEA methodology, still requires petitioners board additional adjudicators.
designation process, as the TEA to demonstrate that the area specified in Comments: Some commenters said it
designation must be secured early in the the regulations in which the NCE is is clear from the Federal Register and
process of analyzing whether a principally doing business has the the Adjudicator’s Field Manual that
particular project is suitable for EB–5 requisite unemployment level. DHS will congressional intent was to allow states
investment. One commenter stated that still review this data as it currently to have the right to issue high
currently, almost all states are able to reviews high unemployment area unemployment area designations. These
designation letters from states, by commenters referenced the issuance of
70 See Tribal Consultation Handbook:
reviewing the area for which TEA the EB–5 regulations in 1991 where
Background Materials for Tribal Consultations on designation is sought to confirm it legacy INS previously decided to
the 2020 Census, Fall 2015, U.S. Department of
Commerce, U.S. Census Bureau, available at complies with the new methodology for delegate the TEA designation process to
https://www.census.gov/content/dam/Census/ including census tracts. As DHS has the states and further cited the now-
library/publications/2015/dec/2020_tribal_ now set the parameters for the size of a superseded Adjudicator’s Field Manual
consultation_handbook.pdf. See also My Tribal
Area, a collection of American Community Survey
TEA, something states previously did, that explained how the agency provided
data for tribal areas, available at https:// there is no longer a role for the states. deference to decisions made by the
www.census.gov/tribal/. The new methodology allows states, emphasizing that USCIS has no
role in the determination process. One percent of all EB–5 petitions filed in compete with larger, better funded
commenter said that DHS assuming the 2015 were within state-designated high regional centers. Another commenter
role of high unemployment area unemployment areas, and according to suggested issuance of TEA designation
designation overturns two decades of the GAO’s analysis of I–526 petitions by DHS would be appropriate for
allowing the formulation of high from the fourth quarter of fiscal year regional center projects because these
unemployment areas to be determined 2015, the vast majority of EB–5 projects can cross state lines and the
by states. One commenter stated that the petitioners who purported to invest in size allows for more financial resources
proposal is directly contrary to the areas of high unemployment had to pay for independent economic
government’s asserted priority to invested in projects physically located studies. The commenter stated that, on
transfer authority from the Federal in a census tract or tracts with the other hand, TEA designation by
Government to the states, while another unemployment levels below the 150% DHS is not appropriate for direct
commenter expressed concern that the of the national unemployment rate investment projects because the projects
shift would ‘‘politicize’’ the designation threshold for high unemployment.74 tend to be smaller and in the same state,
process. DHS believes that this is inconsistent and because coordinating with the local
Response: DHS disagrees with the with clear congressional aims in government provides the project with
assertion that the congressional intent of enacting the EB–5 program and valuable economic and demographic
the EB–5 program was to allow states to therefore warrants a change in policy data.
designate high unemployment areas. mandating high unemployment area Response: DHS rejects the notion that
Commenters referenced no statutory text designations by DHS rather than by the its administration of the TEA
or legislative history to this effect. states. designation process will make it harder
Regulations promulgated by the legacy DHS disagrees with the proposition for direct investment projects. This final
Immigration and Naturalization Service that removing states from the high rule lays out a TEA designation process
(INS), the predecessor to USCIS, and not unemployment area designation process easily navigated by any petitioner—
INA section 203(b)(5), authorized the will ‘‘politicize’’ the designation whether associated with a regional
role of states in the TEA designation process. DHS has proposed a clear and center or not—for little or no cost. The
process. It is clear that the congressional objective high unemployment area data necessary for the TEA designation
intent of the TEA provision was to designation framework allowing high determination is publicly available from
incentivize EB–5 investment in areas of unemployment areas consisting of a the Bureau of Labor Statistics or U.S.
actual high unemployment. Currently, census tract, or contiguous census Census Bureau. A TEA designation
as a result of each state’s interest in tracts, in which the new commercial request alternatively can be supported
promoting investment with its borders, enterprise is principally doing business, with other data, public or private,
the states’ role in designating high if the weighted average of the provided that DHS can validate that
unemployment areas for purposes of the unemployment rate for the tract or tracts data. The TEA designation process will
EB–5 program has resulted in instances is at least 150 percent above the national not require additional costly studies, or
when high unemployment area average. Such determinations will not steps beyond what is already required as
designations include areas far outside of be based on subjective or political part of the Form I–526 petition, that
actual distressed areas that many have factors. DHS will make high would make TEA designation unviable
called ‘‘gerrymandered.’’ 71 For these unemployment designation for direct investment projects. More
reasons, DHS has determined that it is determinations based solely on publicly importantly, whereas DHS has laid out
necessary to shift the high available data. DHS believes this final a transparent process for all new
unemployment area designation from rule makes the process more transparent commercial enterprises to use, each
the states to DHS. and uniform and less subject to political state has a different high unemployment
DHS recognizes that eliminating the whims by eliminating the current area designation process that petitioners
state role in high unemployment area political pressures within each state must satisfy. Investigating and
designation represents a significant associated with the current process. complying with a particular state’s
change from the existing regulations.72 Comments: One commenter said requirements beyond those specified in
However, as pointed out in the NPRM, shifting designation responsibility to the the regulations, or with multiple states’
allowing states to make high Federal Government will invariably different requirements for direct
unemployment area designations has make it harder for direct investments investments that are either not location-
resulted in the application of (i.e., non-regional center investments) to specific or located in multiple
inconsistent rules by various states in jurisdictions, is likely to require more
order to facilitate EB–5 funding to The Distortion of EB–5 Targeted Employment financial resources than adhering to a
increase economic development within Areas: Time to End the Abuse: Hearing Before the single, uniform set of standards and
S. Comm. on the Judiciary, 114th Cong. 12 (2016)
those states.73 The result is that 97 (statement of Gary Friedland, Scholar-in-Residence, processes through DHS. DHS thus is not
N.Y. Univ., Stern School of Bus.) (‘‘USCIS’ persuaded that changes made by this
71 See, e.g., Eliot Brown, ‘‘Swanky New York continued delegation to the states of the TEA rule will be detrimental to or
Condo Project Exploits Aid Program,’’ Wall St. authority without guidelines results in the disproportionately affect direct
Journal, Oct. 13, 2015, http://www.wsj.com/articles/ application of inconsistent rules by the various
posh-tower-proposed-for-struggling-new-york- states. More important, each state has the obvious investment projects. Nothing in this rule
neighborhood-central-park-south-1444728781; self-interest to promote economic development would inhibit their ability to coordinate
Patrick McGeehan and Kirk Semple, ‘‘Rules within its own borders. Delegation presents an with units of local government.
Stretched as Green Cards Go to Investors,’’ New opportunity for the states to establish lenient rules Comments: Several commenters
York Times, Dec. 18 2011, https://nyti.ms/2FgZoQq. to enable project locations to qualify as a TEA.
72 DHS notes that no comments on this change Compounding the problem, often the state agency
suggested that DHS clearly
from any state government were submitted. that is charged with making the TEA determination communicate to the states a program-
73 Is the Investor Visa Program an is the same agency that promotes local economic wide set of well-defined, technically
Underperforming Asset?: Hearing Before the H. development. As a consequence, virtually every sound, and transparent guidelines,
Comm. on the Judiciary, 114th Cong. 62 (2016) EB–5 project location qualifies as a TEA.’’). standards, and rules, such as providing
(statement of Matt Gordon, Chief Exec. Officer, E3 74 See GAO, Immigrant Investor Program:
Inv. Group) (‘‘Generally, States quickly learned to Proposed Project Investments in Targeted
a limit of census tracts, or particular
be as permissive as possible in an attempt to attract Employment Areas, GAO–17–487T, at 8 (Mar. 8, data the state must use for the
ever greater amounts of EB–5 capital.’’); see also 2017). designation. This would allow the states
to continue to be the designators of high indicated a willingness to consider a industry with an overall more
unemployment areas, but would require census block approach for defining high statistically reliable area for high
the states to operate in a more unemployment area TEAs. In proposing unemployment area designation.
streamlined manner. the use of census blocks, commenters Commenters indicated some states are
Response: DHS rejects the proposal. generally suggested a limitation currently utilizing census block groups
While the changes in this rule to the regarding the number of census block in their high unemployment area
definition of a high unemployment area groups that could be used to define a designations and suggested that
that qualifies as a TEA could provide high unemployment area, as long as the numerical limitations could be placed
the rules for state designators, DHS limitation reflected the fact that census on the number of census blocks that
would still need to make individual block groups are a significantly smaller may be utilized, yet neither the use by
determinations on each state area. Commenters offered examples, states nor numerical limitations address
designation as to whether it complies such as San Antonio’s limitation to 24 the issues presented by census blocks
with those rules. DHS believes it would block groups and Houston’s 60-block- relative to census tracts discussed
be duplicative and wasteful, group limitation. above. The final rule contains a
administratively burdensome, and more Response: DHS disagrees with consistent and clear adjudication
difficult to evaluate the individualized commenters supporting the use of framework to reduce these issues.
determinations of the various states than census block groups in lieu of or in Comments: Some commenters stated
to implement and administer a addition to census tracts. While data is that limiting high unemployment area
nationwide standard on its own. available for both census block groups configurations to census tracts would
and census tracts in 5-year estimates,75 negatively affect the many states that
3. Proposal To Change Special currently utilize both block groups and
Designation of a High Unemployment census tract boundaries are delineated
with the intention of being maintained census tracts. These commenters stated
Area that the exclusion of census block
over a long period of time so that
Some commenters supported the groups would particularly affect states
statistical comparisons can be made
proposed changes to the special in the western United States, where less
from census to census.76 While census
designation of a high unemployment densely populated areas can result in
tracts are occasionally split due to
area. Several commenters said the census tracts that are several tens of
population growth or merged as a result
changes align with congressional intent square miles, even hundreds of square
of substantial population decline, such
to provide an incentive for projects miles, in size.
changes are generally reflected in
located in a truly high unemployment Response: While DHS appreciates the
census tract numbering to preserve
area and reduce TEA gerrymandering concerns raised, DHS disagrees with the
continuity for comparison purposes.
and manipulation. Other commenters commenters’ concerns about the impact
emphasized that TEA gerrymandering Census block groups do not offer the
to the western United States and
and manipulation has been well same longevity analysis and census
believes that because the final rule will
documented and criticized by Congress, blocks are not delineated based on
eliminate the states’ role in the high
the media, scholars, and industry population. In fact, many census blocks unemployment area designation
insiders. Other commenters appreciated are unpopulated.77 Thus, census tract process, it will result in uniform
the proposal as a reasonable data is ultimately more reliable for application across the United States. As
‘‘compromise’’ to the possible purposes of designating areas of high discussed elsewhere, census tracts are
definitions of the geographic area that unemployment, as census tracts, unlike drawn based on the total population
could constitute a TEA. census blocks, generally contain certain within the area. Tracts that are
levels of population at any given time, hundreds of square miles in size often
3.1 Alternatives—Use of Census Tracts which strengthens the reliability of the would not require a high unemployment
vs. Block Groups unemployment data collected for that area designation based on the census
Comments: Multiple commenters population.78 As DHS reviews areas to tract, but would instead qualify as a
suggested the use of block groups, determine whether they qualify for high rural area, and thereby be eligible for
which are the smallest geographic unemployment area designation at the TEA designation even if ineligible under
configuration for which employment time of investment or at the time of the high unemployment area criteria.
and unemployment data is available, filing the EB–5 petition, as appropriate, Further, even if such a large tract was
instead of, or in addition to, census DHS believes the use of census tracts not rural, any concentrated urban area
tracts. Commenters listed several provides both petitioners and the within that tract that is a city or town
benefits to using block groups instead of of sufficient population size could
75 See U.S. Census Bureau, American Community
census tracts. One commenter indicated independently qualify on that basis.
Survey (ACS): When to Use 1-year, 3-year, or 5-year
block groups allow TEAs to better Estimates, available at https://www.census.gov/ Finally, because the census tract is
reflect true high unemployment areas programs-surveys/acs/guidance/estimates.html (last based on population size, the size of the
that using larger areas will not allow accessed June 27, 2018). area of the tract is ultimately irrelevant.
76 See U.S. Census Bureau, Geographic Terms and
(e.g., in smaller pockets of high No matter the tract size, the
Concepts—Census Tract, available at https://
unemployment inner city areas). www.census.gov/geo/reference/gtc/gtc_ct.html (last methodology for determining whether
Another commenter noted that, in urban accessed June 27, 2018). the tract (or combination of tracts)
areas, block group high unemployment 77 See U.S. Census Bureau, Census Blogs: What
constitutes a TEA is the same, based on
areas are more equitable because are Census Blocks? Available at https:// the unemployment rate, with the
resident demographics can change www.census.gov/newsroom/blogs/random-
samplings/2011/07/what-are-census-blocks.html calculation being unaffected by the size

drastically from one city block to the (last accessed June 27, 2018). of the tract.
next. Commenters indicated that more 78 See U.S. Census Bureau, Geographic Terms and
than 15 states currently use census Concepts—Census Tract, available at https:// 3.2. Alternative—Commuter Patterns
block groups as allowable sub- www.census.gov/geo/reference/gtc/gtc_ct.html (last Comments: Numerous commenters
accessed June 27, 2018); U.S. Census Bureau,
municipal building blocks in the design Geographic Terms and Concepts—Block Groups,
stated that the designation of a high
of areas for high unemployment area https://www.census.gov/geo/reference/gtc/gtc_ unemployment TEA should include a
approval, and many other states have bg.html (last accessed June 27, 2018). ‘‘commuter pattern’’ analysis that would
focus on defining a high unemployment the census’s best available commuting that would fairly account for variances
area as encompassing the area in which data (which the commenter noted is across the country.80 In addition, DHS
workers may live and be commuting already used for current high could not identify a commuting-pattern
from, rather than just where the unemployment designations) and also standard that would appropriately limit
investment is made and where the NCE merge ACS unemployment data with the geographic scope of a TEA
is principally doing business. the Federal Highway Administration’s designation consistent with the statute
Multiple commenters stated that the online Census Transportation Planning and the policy goals of this regulation to
rule should recognize the relationship Products (CTPP). The commenter said address ‘‘gerrymandering’’ concerns and
between job locations and where its proposed ‘‘9-step’’ approach was more closely link the locus of
workers live and that urban centers consistent with statutory text, but investment and job-creation with areas
where the jobs are located are not encouraged closer analysis and actually experiencing high
necessarily a measure of where refinement of the proposed approach by unemployment.
unemployed residents reside. These industry and government experts. Assuming that a commuting patterns
commenters stated that limiting TEA Response: DHS disagrees with these model might result in jobs being created
designation to the project’s census tracts commenters. The statutory language for workers residing in high-
and any immediately adjacent tracts regarding TEA designations provides unemployment areas, the only way to
(sometimes called ‘‘spooled tracts’’ or that the targeted employment area (i.e., demonstrate that this is the case would
‘‘donuts’’) is unnecessarily restrictive, the area experiencing high be to require that petitioners provide
fails to take into account the linear unemployment or rural area) must be W–2s or other evidence demonstrating
economic development of cities the area in which the new commercial where the workers lived. Even where
following a block-by-block path and/or enterprise will create jobs.79 The such evidence could be provided, it
transit lines, and would make many proposals put forth by the commenters would be too complex and operationally
large job-creating projects in highly were either the same approach burdensome to determine which cases
concentrated urban areas ineligible previously analyzed by DHS and would be impacted and to review such
because the non-contiguous worker- already deemed inappropriate or similar evidence and link each worker to a
supplying areas (where significant job approaches that nonetheless presented separate area of high unemployment for
benefits would accrue) would be the same unresolved issues. While DHS each petitioner.
excluded from the TEA designation appreciates the arguments made by In any event, commuter pattern
calculations. Two commenters said the commenters regarding economic analysis would unduly limit the effects
rule inappropriately ignores that EB–5 development and commuting patterns, of TEA investments on the areas that
investment projects benefit U.S. workers DHS believes that the commuter-based Congress most intended to benefit. For
outside the specific project location who approaches presented do not adequately instance, the Leadership Conference on
use regional mass transit to commute to address the issue of selectively choosing Civil and Human Rights has argued that
urban centers of employment. One of among high unemployment commuting ‘‘it is imperative that Investor Visa
these commenters asserted that, if the areas rather than more comprehensively funds go directly into building
proposed TEA definitions are including all areas to and from which an infrastructure in communities in West
implemented, many large-scale urban individual may commute (including
projects that meet current requirements areas of low unemployment), which 80 DHS reviewed a proposed commuter pattern
and have benefited from significant may ultimately result in merely a analysis incorporating the data table from the
foreign investment would no longer different form of the same type of Federal Highway Administration, ‘‘CTPP 2006–
qualify for EB–5 investment. Similarly, ‘‘gerrymandering’’ that DHS seeks to 2010 Census Tract Flows,’’ available at http://
www.fhwa.dot.gov/planning/census_issues/ctpp/
some individuals wrote that the address with this regulation. Moreover, data_products/2006-2010_tract_flows/ (last updated
proposal to limit TEAs in urban cores to DHS believes that the statutory Mar. 25, 2014). DHS also reviewed the CTTP
a single census track or cluster of incentive for the reduced investment updated status report (January 2018) entitled
‘‘spooled’’ census tracts would unfairly amount in a targeted employment area ‘‘Small and Custom Geography Policy Change
Announcement CTPP Oversight Board is
disadvantage ‘‘the most economically is best effectuated by restricting its Discontinuing Census TAZ for Small Geography
viable urban projects’’—described by application to investments in new Data Reporting and Urging the Transportation
the commenters as those that create jobs commercial enterprises that create jobs Planning Community to Engage in 2020 Census
for workers commuting from the greater in the actual area experiencing high Participant Statistical Areas Program (PSAP),’’
which is available at: https://www.fhwa.dot.gov/
metropolitan area. unemployment or rural area—not in planning/census_issues/ctpp/status_report/sr0118/
Commenters offered various non-rural areas without high fhwahep18046.pdf, which will phase in slight
suggestions to implement a commuter- unemployment that are physically methodological changes over the next year. DHS
based approach. Two commenters distant or otherwise disconnected from found the required steps to properly manipulate the
recommended employing the Census Transportation Planning Product (CTPP)
selected outlying areas with high database might prove overly burdensome for
contiguous model approach with a state- unemployment from which prospective petitioners with insufficient economic and
defined limit of census tracts, which workers may commute. Moreover, as statistical analysis backgrounds. Further, upon
would limit the area that could be discussed in the NPRM, the commuter contacting the agency responsible to manage the
utilized, but still provide a wide enough CTPP data, DHS was informed that the 2006–2010
pattern approach previously considered CTPP data is unlikely to be updated prior to
perimeter to allow for commuting by DHS was deemed too operationally FY2018 to incorporate proposed changes to the data
pattern approach. Two commenters burdensome to implement as it posed table. U.S. Census is currently reviewing the CTPP
recommended that the rule include high challenges in establishing standards to proposed changes. As an alternative methodology
for TEA commuter patter analysis, DHS reviewed
unemployment, non-contiguous census determine the relevant commuting area data from the U.S. Census Tool, On the Map,
tracts (or block groups, as discussed available at http://onthemap.ces.census.gov, which
above) in the TEA designation. One 79 INA 203(b)(5)(B)(i) states: ‘‘No less than 3,000 is tied to the U.S. Census Bureau’s American
commenter recommended a statistically of the visas made available under this paragraph for Community Survey. Although the interface
driven, replicable commuter-based each fiscal year shall be reserved for qualified appeared to be more user-friendly overall, using
immigrants who invest in a new commercial this data would be operationally burdensome,
methodology for urban ‘‘high enterprise described in subparagraph (A) which will potentially requiring hours of review to obtain the
unemployment areas’’ that would create employment in a targeted employment area’’ appropriate unemployment rates for the commuting
combine ACS unemployment data with (emphasis added). area.
Baltimore and the South Bronx and the conforms to the statutory definition. entirely within either an MSA or
like. Projects in neighboring areas will With respect to areas experiencing high county. To further prevent attempts to
leave these communities of unemployment, petitioners may gerrymander TEAs for projects close to
concentrated poverty no better off in demonstrate that the metropolitan the border of MSA regions, some
terms of development and infrastructure statistical area in which their new commenters said the rule could include
after their conclusion.’’ 81 In comments commercial enterprise is principally a limit to the number of sub-municipal
to the proposed rule, the Leadership doing business has the requisite areas (e.g., a limit of 12 or 15 sub-
Conference similarly suggested that a unemployment. Because metropolitan municipal areas) if the TEA were to
commuter pattern analysis would be statistical areas themselves are defined cross an MSA or county boundary.
misused to continue the practice of by reference to commuting patterns, Response: DHS disagrees with these
cobbling together census tracts in order petitioners have a TEA option for non- commenters. The final rule continues
to get the TEA discount for an area that rural areas that is reasonably commuter- the existing policy of allowing an entire
is not in fact a high poverty area. based. MSA or county to be designated as a
DHS considers a variety of officially TEA. Further, the final rule clarifies that
recognized areas (e.g., metropolitan 3.3. Alternative—Tract/Block Limitation
a city or town with a population of
statistical areas and counties) for Comments: Multiple commenters
20,000 or more outside of an MSA can
determining whether a given area has stated that the proposed TEA definition
be designated entirely as a TEA if
experienced high unemployment. Under should be limited to a single census
otherwise eligible. Where a new
both the final rule and existing tract, the tract in which the project is
commercial enterprise is principally
regulations, petitioners may located. The commenters stated that this
doing business in a non-rural area that
demonstrate that the metropolitan would reduce the chance that the TEA
cannot qualify at the MSA, county, or
statistical area in which their new status of a project location might be
city/town outside of an MSA level, the
commercial enterprise is principally based on the economic condition of a
final rule offers the smaller geographic
doing business has the requisite remote tract that does not reflect the
characteristics of the project tract. area of a census tract(s) and the adjacent
unemployment; MSA designation is census tracts to qualify as a TEA. As
based in part on commuting ties among However, these commenters also
suggested that if DHS is determined to previously explained, DHS believes the
related counties.82 Thus, petitioners are census tract is the most appropriate and
not entirely without options to achieve allow contiguous/adjacent census tracts
to be included, all contiguous/adjacent smallest geographic area from which
TEA designation in non-rural areas that relevant, reliable data can be obtained
account for commuter patterns and that tracts should be taken into account
rather than allowing the applicant to regarding unemployment statistics. DHS
does not present the same issues as the rejects the use of census blocks, block
other approaches discussed above. ‘‘pick and choose’’ any single
contiguous/adjacent tract that, taken groups, or other smaller sub-municipal
Comments: Several commenters
together with the project tract, would areas for the reasons stated above.
stated that it would be inconsistent for
meet the high unemployment test. Allowing unlimited census tracts within
DHS to dismiss a commuter-based TEA
Response: DHS appreciates the an MSA or county would wholly or
option in the urban context because
concerns raised by the commenters. substantially continue the existing
‘‘rural’’ TEAs rely on key OMB and
While DHS believes that a single-tract practice of certain states along with the
Census Bureau definitions that depend
approach would be operationally attendant concerns regarding high
on commuting ties. These commenters
efficient to implement, DHS appreciates unemployment area designation
point to the U.S. Census Bureau’s
the concerns held by many other inconsistencies and inequities that the
definition of a core based statistical area
commenters regarding the changes to final rule eliminates.
(CBSA) as defined by the U.S. Census
Bureau: the TEA designation process. Allowing 3.4. Alternative—California Approach
petitioners the flexibility to incorporate
A statistical geographic entity defined by those tracts adjacent to the tract(s) in Comments: Several commenters
the U.S. Office of Management and Budget supported the approach implemented
(OMB), consisting of the county or counties which the new commercial enterprise is
associated with at least one core (urban area) principally doing business helps meet by California, which limits the
of at least 10,000 population, plus adjacent the policy goals of reducing geographic or political subdivision to 12
counties having a high degree of social and inconsistencies and inequities in contiguous census tracts. One
economic integration with the core as adjudications while also recognizing commenter said all gerrymandering
measured through commuting ties with the that a single-tract approach may itself be concerns can be fully addressed by
counties containing the core. Metropolitan inequitable to particular businesses with limiting the number of combined areas
and micropolitan statistical areas are the two to 12, or to some other agreed-upon
close connections to adjacent areas that
types of CBSAs.83
may cross census tract boundaries. DHS number when a TEA crosses MSA (or
Response: DHS is bound by the believes the compromise to allow for the county) boundaries. One commenter
statutory framework defining what inclusion, as needed, of adjacent census said the stated goal of uniformity can be
constitutes a TEA. As explained above, tracts will provide for some flexibility in attained by imposing a single federal
the statute specifically defines what business and economic development standard for TEA determinations, such
constitutes a rural area and the final rule while still providing significant as California’s rule which has a limit of
incentive to invest in a high no more than 12 contiguous census
81 Nancy Zirkin, Executive Vice President,
unemployment area as Congress tracts. The commenter also said that the
Leadership Conference on Civil and Human Rights,
concerns about gerrymandering can be
‘‘Is the Investor Program an Underperforming intended.

Asset?’’ U.S. House of Representatives, 3–4, (Feb. Comment: While supporting some adequately addressed by requiring the
11, 2016), available at https://docs.house.gov/ sort of tract limitation to prevent responsible state agency to articulate a
meetings/JU/JU00/20160211/104454/HHRG-114- gerrymandering, several commenters reasonable basis for its determination
JU00-20160211-SD004.pdf.
82 2010 Standards for Delineating Metropolitan
argued that there should be unlimited that investment at the project site will
and Micropolitan Statistical Areas; Notice, 75 FR configurations of census blocks, block have a beneficial job-creating impact
37246 (June 28, 2010). groups, or other political subdivisions if across the entire area of the TEA. One
83 76 FR 53042. the high unemployment area is located commenter supported the California
approach, but suggested a limit of 15 amount of census tracts or block groups, the U.S. Census Bureau’s American
contiguous census tracts. and suggested the incorporation of the Community Survey (ACS) data as an
Response: DHS disagrees with the ‘‘urban cluster.’’ Another commenter example in the NPRM because the
commenters that gerrymandering suggested use of the NMTC criteria as an survey provides publicly available
concerns would be fully addressed by alternative to the proposed rule’s unemployment data at smaller
limiting the number of combined areas limited geographic area for high geographic area levels such as the
when a high unemployment area crosses unemployment area designation, census-tract level, see 82 FR at 4749;
MSA or county lines. DHS expressed together with use of a single dataset to ACS’s unemployment data is based on
concerns in the NPRM that the use of a determine the unemployment rate. One its calculation of the civilian labor force.
limitation approach, such as the one commenter requested that DHS allow a Thus, the NPRM was not intended to
espoused by the California Governor’s Gateway City 85 TEA designation. require the use of total labor force.
Office of Economic and Business Response: While DHS appreciates Similarly, the final rule does not
Development, would not be appropriate these suggestions, the statutory provide one specific set of data from
for nationwide application. In definitions of a TEA includes rural areas which petitioners can draw to
particular, given the disparity in the size and areas experiencing high demonstrate their investment is being
and shape among potentially includable unemployment (of at least 150 percent made in a TEA. Rather, the burden is on
tracts across various regions in the of the national average rate). DHS the petitioner to provide DHS with
United States, DHS continues to believe believes the statute is best interpreted as evidence documenting that the area in
that the type of limitations on the limiting consideration to these two which the petitioner has invested is a
number of tracts used as suggested by factors. high unemployment area, and such
the commenters would still result in evidence should be reliable and
4. Other Comments on Proposal To
projects in certain regions being much verifiable. DHS believes that the
Change to Special Designation of High
farther removed from each of its unemployment data provided to the
Unemployment Area
constituent tracts than in other regions, public by both ACS and BLS qualify as
ultimately undermining the very Approximately 45 commenters
reliable and verifiable data for
purpose of reforming the high provided other input on the proposed
petitioners to reference in order to carry
unemployment area designation special designation process for high
their evidentiary burden.
process. The final rule does not adopt a unemployment areas.
Comments: One commenter stated Regardless of which reliable and
numerical limitation on the number of verifiable data petitioners choose to
tracts used to ensure that the analysis is that in the preamble to the proposed
rule, DHS incorrectly defined how the present to DHS, the data should be
focused specifically on the area in internally consistent. For example, DHS
which job creation is occurring, taking weighted average of the unemployment
rate is calculated, noting that all official notes that although both BLS and the
into account both the population Census Bureau rely on the concept of
density and geographic area. unemployment rate calculations derived
by BLS and individual states utilize the the civilian labor force in their
3.5. Alternative—New Markets Tax civilian labor force concept, not the unemployment rate calculations, they
Credit Program and Other Suggestions total/full labor force (which includes employ different methodologies. If
Comments: Several commenters military personnel). Another commenter petitioners rely on ACS data to
stated that a better approach to defining stated that the rule presents an oddly determine the unemployment rate for
TEAs would be to utilize the criteria complicated manner of calculating a the requested TEA, they should also rely
established under another proven weighted average, asserting that the on ACS data to determine the national
federal economic development program calculation for a TEA’s unemployment unemployment area to which the TEA is
called the New Markets Tax Credit is simple: Sum the number of compared.
(NMTC) program, rather than a single unemployed people across all of the Finally, DHS opted to use the
criterion (unemployment rate). A tracts, sum the number of people in the methodology in the final rule to ensure
commenter stated that NMTCs may be Civilian Labor Force across all of the proper weight is given to the more
applied based on three criteria,84 but tracts, and divide the number of heavily populated tracts. The method
because they do not focus solely on unemployed by the Civilian Labor suggested by the commenter reduces the
unemployment rates, Congress would Force. effect that a more densely populated
have to act in order to recognize the Response: DHS appreciates these area may have on the average.
NMTC criteria for determining a non- technical comments regarding the Comment: Several commenters
rural area as a TEA. One commenter unemployment data calculations. While suggested that USCIS should publish a
asserted that the use of single-variable the commenter references BLS single dataset covering the entire
definition (unemployment rate) is unemployment rate figures, BLS does country that practitioners must use for
contrary to economic development not make unemployment data publicly TEA unemployment calculations to
principles practiced elsewhere in the available for geographic areas with standardize the process and enhance
Federal Government, such as measures populations less than 25,000. predictability in designations.
used by HUD to establish beneficial DHS mistakenly indicated in the Response: DHS disagrees with these
geographies for the NMTC Program. NPRM that it would consider labor force commenters, as DHS believes there is
Another commenter provided potential to be ‘‘civilians ages 16 and older who already data available to the public to
guidelines and definitions within the are employed or employed, plus active use in calculating the unemployment
NMTC framework that could be adopted duty military’’, thus appearing to rely rate for particular areas, such as the data
in the TEA designation context, solely on total labor force. See 82 FR at provided by the U.S. Census Bureau in
suggested allowing use of an unlimited 4748 n.41. Elsewhere, DHS referenced the American Community Survey. To
invest at the reduced amount,
85 As an example of what the commenter means
84 The criteria used to determine low income
petitioners will be required to
communities for the purposes of the NMTC are (1) by Gateway City, see an explanation of the
median income levels of either the urban distressed Massachusetts Gateway City Initiative available at
demonstrate that their investment is
area or rural area; (2) poverty rate of the area; or http://www.worcestermass.org/city-initiatives/ within a TEA using reliable and
(3) unemployment rate of the area. gateway-cities-initiative. verifiable data such as data from ACS or
BLS to qualify under the requirements the requested TEA, they should also rely believe that congressional intent for the
of a high unemployment area. on ACS data to determine the national reduced investment amount incentive is
Comments: One commenter stated unemployment area to which the TEA is best served by locating investment into
that the methodology presented for compared. areas actually experiencing high
deriving the unemployment rate uses Comments: Some commenters unemployment rather than other
ACS data that is insufficiently current asserted that there is limited or no locations strung together to such areas
for EB–5 purposes, and asserted that all evidence that even the most egregious and to which individuals from such
states properly use ACS data in gerrymanders have done anything less areas could potentially commute for
conjunction with the latest available than create needed jobs for high employment. In order to best assist in
official county estimates in order to best unemployment regions. One commenter the revitalization of those areas, the
reflect current economic status. One wrote that ‘‘Manhattan for instance, a actual development must be located
commenter stated that the proposed rule big area of controversy for TEA critics, there. The final rule provides clear
did not specify which dataset should be has in fact had projects with criteria for the designation and
used for TEA calculations, gerrymandered TEAs. Even the most eliminates state involvement to ensure
recommending that USCIS follow the luxurious developments in Manhattan that the TEA incentive is not afforded to
guidance given by the BLS Local Area that boast condos with no less than $3 gerrymandered areas where high
Unemployment Statistics (LAUS) million price tag per unit, have created unemployment may not truly exist.
branch in their Technical Memo S–10– much needed jobs for construction Comments: A few commenters said
20. Another commenter presumed that workers in the Bronx, Queens, the proposed revisions to the method of
USCIS would utilize the most current Brooklyn, Harlem, and Long Island. If determining a high unemployment area
unemployment datasets and the census- the agency can find any research out would disproportionately favor rural
share methodology—ACS and BLS—to there that shows otherwise, please areas over urban areas and even further
create a mapping system that would provide that research before any final disadvantage the more densely
enable the user to readily determine rule on the TEA issue.’’ populated urban areas. One commenter
whether a project location qualifies as a Response: DHS appreciates these stated that the approach in the rule
TEA. A commenter urged the selection comments regarding gerrymandering skews in favor of certain American
of a single dataset from which the concerns. In addition to the DHS data towns and cities while disfavoring other
unemployment statistics are obtained, analysis detailed in the NPRM, the urban markets simply because they vary
recommending the ACS 5-year Government Accountability Office in population density, arguing that
estimates. (GAO) completed an audit of EB–5 TEA population density does not provide a
Response: DHS appreciates these data in 2016.86 GAO’s review rational basis to prefer certain urban
suggestions. DHS recognizes that ACS determined that approximately 90 TEAs to the detriment of others.
data for census tracts is currently percent of petitioners from the fourth Another commenter cited Census
provided in five-year estimates and that quarter of FY 2015 who elected to invest Tract 99 in New York County—a tract
states may have more recent data at the in a high unemployment TEA did so in that is the site of some EB–5 projects—
census tract level. However, given an area not consisting of a single census to illustrate some of the commenter’s
that—as the commenter tract, census block group, or county. Of key concerns about DHS’s TEA proposal
acknowledged—states utilize different those petitioners, 38 percent combined in the NPRM. The commenter argued
methodologies than ACS and BLS, 11 or more tracts in order to that BLS and ACS data, as well as data
petitioners may not be able to compare demonstrate the project was in a high made available through the U.S. Census
the state census tract data to a national unemployment area, with 12 percent Bureau’s Longitudinal Employer-
unemployment rate that utilizes the utilizing more than 100 census tracts. Household Dynamics (LEHD) tool, show
same methodology. Although DHS DHS believes the high percentage of that high unemployment tracts within
recognizes that there are benefits to petitioners utilizing so many census New York County are well within
limiting the unemployment statistics to tracts gives rise to a significant concern standard commuting distances to
a single dataset, the final rule does not that congressional intent relating to TEA Census Tract 99. The commenter stated
provide one specific set of data from that ‘‘[a]ccording to the NYC MTA, a
investments is too often not being met.
which petitioners can draw to person could board the subway at the
DHS believes this is because the
demonstrate their investment is being north end of Manhattan Island and
percentages likely reflect efforts to
made into a TEA because currently no travel to a subway station in the middle
artificially construct areas that meet the
one dataset is perfect for every scenario. of Census Tract 99 in 30–50 minutes for
unemployment threshold requirement
Thus, the burden is on the petitioner to $2.75 or less one-way. The DHS
to qualify for the reduced investment
provide DHS with evidence proposal should recognize that an
amount incentive rather than an
documenting that the area in which the unemployed person is unlikely to object
intention to locate the investment in the
petitioner has invested is a high to that kind of commute.’’ The
area actually experiencing high
unemployment area, and such evidence commenter also pointed out that a focus
unemployment. DHS recognizes that on unemployment rates in a particular
should be reliable and verifiable. DHS
believes that the unemployment data many investment projects regardless of area, rather than total numbers of
provided to the public by the U.S. location will create jobs, some of which unemployed persons, potentially
Census Bureau’s American Community might even be filled by individuals from obscures the impact that DHS’s proposal
Survey as well as data available from outlying areas experiencing high could have on economically distressed
unemployment (though verifying
the Bureau of Labor Statistics qualify as urban areas. The commenter stated that
reliable and verifiable data for whether jobs are being created for such in 2014, New York County had on
petitioners to reference in order to carry individuals would be a significant average 55,387 unemployed workers, as
their evidentiary burden, though, as challenge). Still, DHS continues to compared to 75,259 unemployed
noted above, the data relied upon 86 GAO, Immigrant Investor Program: Proposed
workers statewide for Iowa, and 14,302
should be internally consistent. For Project Investments in Targeted Employment Areas,
for Vermont. The commenter concluded
instance, if petitioners rely on ACS data GAO–16–749R, Published Sept. 19, 2016, available that any proposal should not seek to
to determine the unemployment rate for at http://www.gao.gov/products/GAO-16-749R. ‘‘fix’’ the lack of rural and highly
distressed urban project deal flow in the invest in these projects above the date that is 120 days after publication of
EB–5 program by establishing rules that minimums required. Foreign investors this rule, i.e., 90 days beyond the
discourage investment in some urban may also see investments in projects in minimum implementation period
areas. Rather, TEA designations should affluent urban areas to be more required by 5 U.S.C. 553(d), and 60 days
encourage new investment and new job prestigious. In addition, to the extent beyond the minimum implementation
creation under the EB–5 program in a that projects in affluent areas that can period required for major rules under 5
fair and predictable way, with positive no longer attract EB–5 capital still U.S.C. 801(a)(3). The implementation
inducements for projects to locate in proceed with other sources of capital, period is intended to provide additional
rural or distressed urban areas. The while more projects in poor or rural time for EB–5 petitioners and the EB–5
commenter ultimately supported the areas receive EB–5 capital without market to adjust investment plans. Even
‘‘New Markets Tax Credit’’-like which they could not proceed, overall those commenters that requested
approach that DHS has addressed investment in the U.S. economy may specific implementation periods longer
elsewhere in this preamble. increase. than 120 days (e.g., six months or one
Another commenter stated that DHS The final rule clarifies the year) did not provide clear, actionable
should strive to ensure that both urban requirements for TEA designation in data underlying such recommendations.
and rural projects have ‘‘equal high unemployment areas and also An implementation period longer than
opportunity’’ to improve their eliminates state involvement in the high 120 days would likely place an
respective communities. unemployment area designation process additional burden on agency operations
Response: DHS believes the final rule to better ensure consistent, equitable and potential petitioners, because it
does ensure that both urban and rural adjudications across the country. DHS is would likely result in an influx of new
projects have equal opportunity to bound by the statutory framework petitions prior to the effective date that
improve their respective communities. defining rural areas and areas of high could lengthen adjudication delays and
Petitioners have overwhelmingly unemployment (based on visa backlogs. Such an influx would
obtained TEA designation in urban (i.e., unemployment rate greater than 150 generally be consistent with past
non-rural) areas in recent years.87 percent of the national average rather experience during times when
Although projects in more affluent than total number of unemployed petitioners anticipate significant
urban areas may have created individuals). By utilizing the census changes to the program.
employment for employees living in tract (and/or adjacent tract(s)) in which DHS has detailed how it will
high unemployment areas within a the new commercial enterprise is implement the rule in Sections I.E and
reasonable commuting distance, DHS principally doing business, DHS is I.F of this preamble, and elsewhere in
notes that it is challenging to verify this, regulating consistent with the statutory this rule. As explained elsewhere, the
and would require the provision of W– framework to ensure that the area most changes in this rule will apply to all
2 forms or other sufficient directly affected by the investment and Form I–526 petitions filed on or after
documentation for direct jobs. In in which jobs are created is the focus the effective date of the final rule.
addition, allowing such areas to qualify regardless of population size or density. Petitions filed before the effective date
as a TEA may have deterred direct EB– will be adjudicated under the
5 funding in areas truly experiencing 5. Other Comments on the TEA
regulations in place at the time of filing.
high unemployment and in dire need of Designation Process
DHS disagrees with the commenter’s
revitalization. Also, developers of Multiple commenters provided other request that TEA designations be
projects in affluent urban areas may be input on the TEA designation process. available prior to Form I–924 and Form
able to market the projects to potential Comments: Numerous commenters I–526 filings. In accordance with the
EB–5 investors as more likely to (1) recommended grandfathering the statutory framework, under which TEA
result in the investors receiving green existing TEA methodology, including designation must be determined ‘‘at the
cards because the projects are less likely suggestions to allow for a ‘‘meaningful’’ time of the investment,’’ INA section
to fail, (2) result in the investors seeing transition period, or at least allow 203(b)(5)(B)(ii), 8 U.S.C.
their capital returned because they are petitioners who properly filed prior to 1153(b)(5)(B)(ii), and consistent with
less likely to fail, and (3) deliver a the change to continue to qualify. longstanding policy, a TEA
higher rate of return on the investors’ Several of these commenters asserted determination is made at the time the
investments.88 These factors could more that the rule should include a transition Form I–526 petitioner makes his or her
than compensate for the higher required or phase-in period or delayed effective investment or at the time the Form I–
investment amount. In fact, to the extent date to enable projects that are presently 526 petition is filed for petitioners who
that a higher rate of return and more in the market to make the necessary are actively in the process of investing.
safety for invested capital are expected, changes in their operations going As with the existing process, DHS will
foreign investors might actually prefer forward. One commenter expressed review the TEA designation evidence
to increase the amount of capital they uncertainty in how the revised TEA with the Form I–526 petitioner’s filing
designation process would be to determine eligibility at that time. For
87 See GAO, Immigrant Investor Program: implemented, particularly with respect petitioners who have a pending or
Proposed Project Investments in Targeted to its effect on current projects and approved Form I–526, already received
Employment Areas, GAO–16–749R, Published Sept.
19, 2016, available at http://www.gao.gov/products/ conditional permanent residents, conditional permanent resident status,
GAO-16-749R (showing that approximately 97% of pending Form I–526 and Form I–829 or a pending Form I–829 petition based
petitioners from the fourth quarter of fiscal year petitions, and exemplars approved by on a previously approved Form I–526, a
2015 were estimated to have invested into a high
DHS prior to the effective date of the TEA determination will have already
unemployment TEA).
88 ‘‘Foreign investors see glitzy projects in rule. been made or will be made based on the
gateway cities as more secure investments, both for Response: DHS believes that an regulations in place at the time of filing
getting their money back and for getting their green extension to the transition period is of those Form I–526 petitions.
cards.’’ Jeff Collins, ‘‘Need a Fast Track to appropriate, given the potential impacts Comments: A few commenters said
Citizenship? Invest in These Orange County Luxury
Hotels,’’ Orange County Register, (Oct. 13, 2015)
of the TEA designation changes on the final rule should clarify that the
(quoting Pat Hogan, president of CMB Regional current projects and investors. DHS is TEA designation is honored from when
Centers). therefore is providing for an effective the funds are actually invested, not
when the funds are placed in escrow, capital investment process. If the TEAs (rural and high unemployment
because a location’s TEA designation is commenters’ suggestion was followed, it areas).
subject to change based on changed would be unclear at what point the area DHS could eliminate the differential
circumstances. in which the NCE is principally doing between the standard minimum
Response: DHS disagrees with the business needs to qualify as a TEA. The investment amount and the TEA
commenters. Section 203(b)(5)(B)(ii) of moment at which the investor who was minimum investment amount, thereby
the INA provides that the area must actively in the process of investing at eliminating the two-tier investment
qualify as a TEA at the time of time of filing has completed that process amount system currently in place,
investment. However, section can vary depending on a number of leaving the visa set aside as the only
203(b)(5)(A)(i) of the INA also provides factors—including at some point after incentive for investment in TEAs.
that to be eligible for an EB–5 visa, a the adjudication of the Form I–526 However, DHS declines to do so and has
petitioner may either have invested or petition. In other words, because decided to maintain the 50 percent
be actively in the process of investing investments need to be structured prior differential to continue to incentivize
capital into an NCE. Applicable to filing the Form I–526 petition but investment in rural and high
administrative precedent decisions have may continue after the adjudication of unemployment areas. Removing the
further clarified that petitioners must the Form I–526 petition, the differential and leaving in place only
demonstrate that the NCE into which commenters’ proposed policy would the visa set aside as an incentive would
they have invested or are actively in the lead to circumstances where it could not not leave a sufficient incentive in place
process of investing is principally doing be known whether the area would for investment in TEAs. Congress
business in a TEA at the time of filing qualify as a TEA until after the Form I– permitted DHS to offer a two-tier
the petition.89 To make the TEA 526 petition has been adjudicated. This investment system, with reduced
determination in a manner consistent would create an untenable degree of minimum investment amounts in TEAs
with the statutory provisions and the uncertainty in the capital investment relative to outside of TEAs. DHS is
precedent decisions, and promote process. Furthermore, DHS would have addressing the current imbalance in
predictability in the capital investment no basis for determining TEA eligibility which almost all investments are made
process, DHS has implemented a policy at either the time of filing or at the time in potentially gerrymandered TEAs by
of making the TEA determination as of adjudication because the petitioner revising the designation of areas of high
follows: would have no basis to demonstrate unemployment that may qualify as a
• If the petitioner has invested capital TEA eligibility at such times. DHS TEA. This change, in combination with
into the NCE, and the capital has been recognizes the commenters’ concern maintaining the 50 percent differential,
made available to the job-creating entity that it is possible that some project will maintain a sufficient incentive for
(JCE) in the case of investment through tracts that qualify as a TEA at the time investment in TEAs while ensuring that
a regional center, prior to the filing of of filing of the petition might not qualify the TEAs benefiting from the incentives
the Form I–526 petition, then the TEA as a TEA when a petitioner who was align with congressional intent.
analysis focuses on whether the NCE, or actively in the process of investing at Finally, DHS does not have the
JCE in the case of an investment through time of filing has completed that statutory authority to reduce the
a regional center, is principally doing process. The change in policy suggested minimum investment amount for
business in a TEA at the time of by the commenters would create investments in a new commercial
investment. uncertainty and unpredictability in the enterprise that creates direct jobs. The
• If, at the time of filing the Form I– capital investment process; and would statute only authorizes a lower
526 petition, the petitioner is actively in render DHS incapable of determining minimum investment amount for
the process of investing capital into the TEA eligibility in cases where the investments made in a TEA.
NCE but the capital has not been made petitioner is actively in the process of
available to the JCE in the case of E. Technical Changes
investing at the time of filing the
investment through a regional center, petition. 1. Separate Filings for Derivatives
then the TEA analysis focuses on
Comments: Some commenters said Comments: Many commenters
whether the NCE, or JCE in the case of
the TEA process should be eliminated, supported the proposal that derivatives
investment through a regional center, is
along with the increased minimum file their own separate Form I–829
principally doing business in a TEA at
investment at the two-tier level, and petitions if not included in the
the time of filing the Form I–526
instead should be replaced by a set- principal’s Form I–829 petition for
petition.90
aside of visas for the desired targets reasons other than the death of the
The final rule does not change this
(rural, high unemployment, principal. The commenters stated this
policy. DHS believes that this policy is
infrastructure, and manufacturing). One would protect derivatives against
consistent with the relevant statutory
commenter suggested that DHS termination of their conditional
provisions and precedent decisions and
incentivize the creation of direct jobs by permanent residence when the principal
is the most fair to individual investors
allowing projects that do so to be investor’s conditional permanent
because it provides predictability for the
exempt from the necessity of being in a residence is abandoned. One commenter
89 See Matter of Soffici, 22 I&N Dec. 158, 159 TEA to be subject to the lower minimum disagreed with the proposal,
(Assoc. Comm. 1998) (‘‘A petitioner has the burden investment amount. recommending that USCIS retain what
to establish that his enterprise does business in an Response: DHS declines to adopt the the commenter believed to be the
area that is considered ‘targeted’ as of the date he commenters’ suggestions regarding current practice of allowing the spouse’s
files his petition.’’); see also Matter of Izummi, 22

I&N Dec. 169, 173 n. 3 (Assoc. Comm. 1998) (‘‘A TEAs. DHS lacks the authority to make or child’s biographical documents to be
petitioner must establish that certain areas are some of the changes requested by these ‘‘interfiled’’ when a family member is
targeted employment areas as of the date he files his commenters given the current statutory not included in the investor’s Form I–
petition; just because a particular area used to be framework of the EB–5 program. DHS 829 petition. The commenter stated that
rural many years ago, for example, does not mean
that it still is.’’). cannot completely eliminate TEA because the filings would be identical to
90 USCIS Policy Manual, 6 USCIS–PM G, Chapter designations because 3,000 visas are the investor’s filing, USCIS would not
2. statutorily set aside for investment in need to review project documents filed
with the spouse or child’s petition and Partners; or a corporation, which has backlogs based on handling TEA
USCIS should not charge a filing fee officers and directors. The commenter designations, because the agency
since it will not be re-adjudicating the stated that an LLC will either be currently reviews the TEA designation
I–829 project documents. member managed or manager managed. evidence provided by petitioners to
Response: DHS believes the Response: DHS believes the language determine TEA statutory eligibility. The
commenter who disagreed with the in the rule at final 8 CFR 204.6(j)(5)(iii) framework detailed in the NPRM and
proposal misunderstands the proposed is broad enough to encompass a variety finalized in this rule should not increase
change. DHS did not propose to change of different possible ownership and the burden to petitioners or to DHS in
the current process, under which management structures, including the adjudication process. As in the
derivatives may still request to be added members of both member-managed current process, EB–5 petitioners will be
to a principal’s pending Form I–829 if LLCs and manager-managed LLCs required to provide evidence to
they pay the biometric fee, and are because each of those types of LLCs demonstrate the area in which the new
otherwise eligible to be classified as the normally provide their respective commercial enterprise into which they
principal’s derivatives. Such derivatives members (equity holders) with different are investing is principally doing
may be added to the pending Form I– rights, duties, and powers. In the future, business is a TEA. The new framework
829 even in case of divorce during the DHS may consider issuing policy requires petitioners to identify the
conditional residence period. Instead, guidance to provide additional census tract(s) in which the NCE is
DHS proposed to standardize the clarification if deemed necessary. doing business and provide population
process for those derivatives who file an and unemployment statistics for that
individual Form I–829 petition and F. Other Comments on the Rule
tract and any other adjacent tracts that
cannot be included on the principal’s 1. Processing Times are relevant to the determination. USCIS
Form I–829, generally because the will review this data in a manner
principal fails or refuses to file a Form Comments: Multiple commenters
discussed current USCIS processing similar to how USCIS currently reviews
I–829. Under these circumstances, the high unemployment area designation
final rule clarifies the current DHS times or the impact the proposed rule
would have on processing times. Many letters from states; it will review the
practice of requiring all derivatives proposed area to confirm it is the area
connected to a single principal investor commenters expressed frustration with
USCIS processing times, stating that in which the NCE is principally doing
to file separately. Thus, for example, if business and review the underlying data
there are two derivatives (either a current wait times are harming
investors. Commenters recommended and methodology associated with the
spouse and child, or two children) and statistics provided.91 In fact, the use of
the principal refuses to file a Form I– electronic submissions and premium
processing to decrease delays. a uniform methodology for all TEA
829 petition, each derivative is required designations could improve the
to file a separate Form I–829 petition. Response: DHS appreciates the
concerns raised by these comments efficiency of these determinations as
This final rule only allows derivatives to adjudicators will be more familiar with
apply together on a single Form I–829 regarding USCIS processing times. DHS
is considering ways to improve the EB– the new framework. As such, DHS does
petition when the principal is deceased, not anticipate a negative impact to the
because INA 204(l) directs DHS to 5 program to decrease processing times.
However, DHS does not believe that the overall timing of the adjudication
adjudicate ‘‘notwithstanding the death process.
of the qualifying relative.’’ Because the changes made by this rule will have an
principal would have had the option to adverse effect on processing times. With 2. Visa Backlogs
file a single Form I–829 on behalf of the respect to Form I–526 petitions, this
Comments: Many commenters
whole family, the option remains even rule only raises the investment amounts
discussed visa backlogs in the EB–5
though the principal is deceased. This and provides more specific
program. Multiple commenters stated
rule does not change the current DHS requirements for petitioners investing in
that the current visa backlog was
practice, and DHS is simply clarifying targeted employment areas. These
negatively affecting participation in the
the language in 8 CFR 216.6(a)(1) to changes should not increase
EB–5 program. Several commenters
avoid a situation where derivatives adjudication times. With respect to
argued that if DHS intends to increase
filing separately do so incorrectly, Form I–829 petitions, this rule clarifies
the minimum investment amount, it
causing their petition to be rejected. when derivative family members must
should focus on fixing the visa backlog
file their own petition and seeks to
2. Equity Holders first or at the same time.
improve the adjudication process by Response: Congress, not DHS, has set
Comment: DHS received one providing flexibility in interview the annual visa allocation for the EB–5
comment on the proposal to consider locations. DHS does not anticipate this program. These concerns should more
equity holders in a new commercial will adversely affect Form I–829 properly be addressed to Congress.
enterprise as sufficiently engaged in processing times because the
policymaking if the equity holder is adjudication standards remain the same. 3. Timing of the Rule
provided with the rights, duties, and The recommendation regarding Comments: Most commenters were
powers normally provided to equity electronic submissions and premium concerned about the implementation
holders in those types of entities. This processing to decrease delays is outside and timing of the rule and its impact on
commenter indicated there is a the scope of this rulemaking. previously filed EB–5 petitions and
difference between equity holders that Comments: Numerous commenters current projects. Many commenters
manage the company and third party
expressed concerns about processing argued that the proposed rule, if

managers that manage the company, times in TEA designations as DHS takes finalized, should not apply
which should be clarified in the rule. over the designation process from the retroactively, and USCIS should
The commenter asserted that this states. grandfather currently approved and
clarification is important in the context Response: DHS is committed to pending petitions and applications, or
of limited liability companies (LLCs), providing timely TEA decisions as part
which, unlike limited partnerships, do of the adjudication process. DHS does 91 USCIS Policy Manual, 6 USCIS–PM G, Chapter
not have a General Partner and Limited not foresee an increase in petition 2.
grandfather in entire projects such that also thwart congressional intent by an option to withdraw their investment
future EB–5 petitioners in grandfathered allowing such projects to continue to as a result of applicable securities laws.
projects would only need to invest at attract investors using the incentives Accordingly, the offering documents
the lowered investment thresholds in that Congress intended for high associated with a Form I–526 petition
place prior to the effective date. Several unemployment and rural areas only, filed before the effective date of this rule
commenters requested a transition potentially reducing the amount of EB– may be affected, and such modifications
period before the rule’s effective date to 5 capital going to those areas. While normally would likely result in a denial
provide a grace period for the change DHS appreciates the comment of the petition based on a material
and prevent a chilling effect on the EB– suggesting that pending petitions be change. The regulatory text at final 8
5 investment market, and one subject to this rule due to the current CFR 204.6(n) provides that amendments
commenter suggested twelve months to backlog, implementation would be or supplements to offerings made to
allow certain projects additional time to difficult because petitioners for each maintain compliance with applicable
complete fundraising. Some pending petition would have to make securities laws, based solely upon this
commenters requested clarification on material changes to their petitions to rule’s effectiveness, will not
how the rule would affect current meet the new standards, including by independently result in ineligibility of
projects. One commenter stated that the investing additional amounts that they petitioners with pending or approved
petitions filed up to the date of did not anticipate. DHS believes this Form I–526 petitions who filed prior to
promulgation of the rule should only be would unfairly harm investors that filed this rule’s effective date and who
subject to the new requirements if they based on the eligibility requirements in remain invested, or who are actively in
are denied by USCIS because of project place at that time and invested in the process of investing, and who have
discrepancies, when adjudicated after projects that had been planned and no right to withdraw or rescind their
the date of enactment. Conversely, initiated with the investment amounts investment or commitment to invest
another commenter stated that due to in place at the time. For example, in into such offering when their petition is
the current visa backlog, DHS should addition to the fact that resulting project adjudicated. This addition clarifies that
apply the rule to pending EB–5 changes would likely be considered petitioners will not be adversely
applications because otherwise changes material changes, requiring pending affected by a change to offering
would not affect the EB–5 program for petitions to increase their investment documents, necessitated by this final
several years. could provide a project with too much rule’s changes, so long as the
Response: This final rule will become capital, and in turn potentially petitioner’s investment remains at risk
effective 120 days after publication, as precipitate a misappropriation of excess through adjudication and the petitioner
outlined earlier in this preamble. funds. DHS believes applying the new continues to meet program
Specifically, the provisions of this final rules to petitions filed on or after the requirements. Additionally, the
rule will apply to Form I–526 petitions effective date is the best way to provision that changes to offering
filed on or after that effective date. Form implement this rule. As such, and as documents should not include a right to
I–526 petitions filed prior to the mentioned above, DHS will apply the withdraw or rescind at the time of
effective date of the rule will be allowed regulatory scheme in place at the time adjudication allows petitioners to
to demonstrate eligibility based on the of filing when adjudicating Form I–526 remove or reject such provisions
regulatory requirements in place at the petitions, which means that this final because of changes necessitated by this
time of filing of the petition. rule will apply to Form I–526 petitions regulation without penalty, in
With respect to the commenter accordance with the existing material
filed on or after the effective date.
suggesting this rule be applied only to change policy.
denied petitions that fail to remedy While DHS is declining commenters’
project discrepancies prior to the suggestion to grandfather approved 4. Material Change
effective date of the rule, any petition projects, DHS has considered how Comment: One commenter
filed on or after the date of this pending petitions associated with recommended expanding the NPRM to
implementation will be required to existing projects could be affected and incorporate the material change portion
establish eligibility under the new rules. is making one revision to the regulations of the policy memorandum (PM–602–
This seems to reflect the commenter’s in this final rule to address a problem 0083) issued May 30, 2013, to avoid
suggested approach. that could affect some pending petitions confusion and codify the material
DHS disagrees with the comments as a result of this regulatory change. change policy. The commenter asserted
suggesting grandfathering approved DHS is adding one regulatory text that this change would make clear that
projects under the current rules. clarification at 8 CFR 204.6(n) regarding an investor who obtained conditional
Grandfathering of approved projects how this rule will be implemented with LPR status may proceed with the I–829
would result in unequal treatment of respect to petitioners with pending or petition, and provide evidence that the
petitions filed after the rule is in effect approved petitions who filed prior to requirements for the removal of
and would be overly burdensome the effective date of the final rule. conditions have been satisfied, without
operationally. Further, grandfathering Investment offering documents are the need to file a new Form I–526
approved projects would have the effect typically associated with a particular petition if there have been changes to
of delaying the application of this rule number of investors investing a specific the business plan since the Form I–526
for a substantial number of petitioners, dollar amount. Projects that are still was filed. The same commenter
which would tend to undermine the accepting new investors after the suggested that DHS expand its material
immediate effectiveness of the policy effective date of this rule may have to
change policy to allow those with

aims of this rule. It would grant existing change their offering documents to approved Form I–526 petitioners to
projects in affluent urban areas that account for the new minimum remain eligible for adjustment of status
have been marketed as TEAs an unfair investment amounts, or to maintain even if material changes occur in the
competitive advantage against new compliance with other securities interim.
projects in such areas, which will need regulations. The change in offering Response: DHS believes existing
to attract investors at the higher documents also could provide existing policy guidance on material change is
minimum investment amount. It would investors with pending petitions with sufficiently clear, specifically that
USCIS does not deny Form I–829 center funding is used to construct or center until an exemplar is
petitions based solely on the failure to renovate office or retail space; provisionally approved; 95
adhere to the business plan contained in • Placing meaningful limits on the • Encouraging more public
the Form I–526 petition,92 and thus will number of jobs created by non-EB–5 infrastructure projects to participate in
not codify the policy into regulation at capital that can be attributed to EB–5 the EB–5 program to facilitate the flow
this time. DHS also does not intend to investors; of much-needed capital to public
change its material change policy • Setting different differentials for infrastructure projects nationally, in
through this final rule, but did solicit regional center petitioners investing in order to save taxpayer dollars and fuel
public feedback on potential changes to TEAs, and non-regional center investors improvement initiatives that might
the policy in the EB–5 Immigrant investing in TEAs; otherwise be delayed by funding
Investor Regional Center Program challenges;
ANPRM.93 • Clarifying which indirect jobs may • Prohibiting the use of publicly
count towards the job creation tradeable securities, such as municipal
5. Comments Outside the Scope of This requirement; bonds, to qualify as an eligible use of
Rulemaking • Clarifying how the adjudications EB–5 capital;
DHS received many comments backlog affects the job creation • Allowing only investors who come
outside the scope of this rulemaking. requirement. The commenter stated that from countries that enforce similar labor
For instance, some comments suggested many construction jobs are temporary and financial laws as the United States;
potential ways to improve the EB–5 and disappear prior to the investor • Precluding roll-over of the required
program as a whole or sought guidance establishing conditional residency, 3,000 visas set aside for TEAs into the
regarding existing requirements that putting many investors at risk of having regular EB–5 visa pool and instead
would have been unaffected by the their petitions denied for failing to requiring the set-aside to remain
proposed rule. Because these comments create 10 jobs; available only for investments in rural
are outside the scope of this rulemaking, • Revamping or completely and depressed areas;
DHS is not providing responses to these eliminating the job-creating entity • Precluding reauthorization of the
comments. To the extent that the process in favor of making qualified Regional Center Program because of its
suggestions for program improvements investments in individual state- potential for fraud;
do not require congressional action to approved infrastructure projects; • Expanding the Regional Center
change the statutory authority governing • Amending the regulations to clearly Program to help spur the private market;
the EB–5 program, DHS may consider state that the I–924 amendments are not • Changing requirements to allow a
these suggestions when developing the necessary to amend the geography of a petitioner to remain eligible despite
proposed rule that DHS plans to issue previously filed I–924, or that a Form I– regional center termination;
following the ANPRM or in future 526 petition may be filed subject to the • Creating a mandatory
guidance materials. With respect to expansion of a previously filed and administrative appeals process for the
comments requesting guidance on pending Form I–924; 94 EB–5 program, requiring investors to
current requirements, DHS may exhaust their administrative remedies
consider including clarifications in • Allowing Forms I–924 to be
prior to going to the judicial system; 96
perfected after filing because, the
future guidance materials. • To ensure transparency, requiring
Comments from the public outside the commenter states, the critical point for
third-party administration of the
scope of this rulemaking concerned the demonstrating full eligibility is at time
investment funds that are being used in
following issues: of adjudication;
the EB–5 projects to show the investor
• Allowing stand-alone program • Authorizing expedited processing that there is compliance with the
petitioners to count indirect jobs, as for Form I–526 petitions and Form I– business plan;
indirect jobs relate to the impact of the 924 applications; • Prioritizing non-Chinese petitions
investment on the community where the • Allowing parole for all investors because there is a low likelihood that
project is located; who have already invested and filed a any visas for Chinese investors will be
• Creating a more balanced and fair Form I–526 petition; available in the near future;
approach to counting direct job creation • Allowing concurrent filing of the • Removing conditions on residence
for stand-alone projects; Form I–526 petition and the Form I– for investors with a visa backlog of more
• Encouraging more stand-alone EB– 485, Application to Register Permanent than two years;
5 investment projects ‘‘where actual, Residence or Adjust Status; • Modifying 8 CFR 204.6(j) to provide
full-time, permanent jobs are more that the list of evidence of property
likely to be created,’’ rather than • Requiring practitioners who prepare
source of funds documents to file an transferred from abroad for use in a U.S.
regional center construction projects enterprise is a list of possible, but not
which frequently depend on indirect attestation with the Form I–526 petition
stating that they performed certain due required, evidence;
jobs to satisfy the job creation • Not counting 2,000 EB–5 cases that
requirement; diligence checks;
the commenter indicated were
• Requiring that investors show that • Making regional center exemplar
processed late due to USCIS oversight
jobs established through indirect filings mandatory and prohibiting an
toward the visa quota because it would
modeling methodologies are full-time investor from filing a Form I–526
jobs and that the investors have actually petition in connection with a regional 95 DHS solicited public comment on the issue of
created the requisite number of jobs; mandatory exemplar filings in the January 11, 2017
• Eliminating projects that rely solely 94 Please refer to existing DHS policy guidance ANPRM (82 FR 3211).
on ‘‘tenant occupancy’’ to fulfill the job addressing these commenters’ concerns. See Form 96 Note that EB–5 petitioners can appeal decisions
I–924 Instructions, available at http:// related to their Form I–526 petitions to the
creation requirements in which regional www.uscis.gov/I-924; see also Update to March 3, Administrative Appeals Office (AAO) within
2017 Stakeholder Engagement Remarks, available at USCIS. USCIS, When to Use Form I–290B, Notice
92 USCIS Policy Manual, 6 USCIS–PM G (Aug. 23,
https://www.uscis.gov/sites/default/files/USCIS/ of Appeal or Motion, available at https://
2017). Working%20in%20the%20US/alert2017_ www.uscis.gov/i-290b/jurisdiction (last visited June
93 82 FR 3211 (Jan. 11, 2017). march.pdf. 22, 2018).
unfairly penalize investors for USCIS’s • Offer defrauded investors remedies, further study of the effects of the rule.
error; such as parole in place, employment DHS recognizes that EB–5 investment
• Modifying Department of State’s authorization, and age-out protections structures are complex and typically
Visa Bulletin; for minors. involve multiple layers of investment,
• Reducing visa wait times for DHS appreciates these proposals to finance, development, and legal
Chinese nationals; improve program integrity and combat business entities. Further, DHS
• Increasing the number of EB–5 visas fraud. DHS, however, did not address acknowledges that data limitations
to 30,000 or 50,000, or modifying the these issues in the proposed rule, and preclude a detailed analysis of the
number of visas through administrative therefore these suggestions fall outside potential quantitative costs of this rule.
remedies or legislation; of the scope of this rulemaking. As such, However, DHS does not see how
• Adjusting the EB–5 visa limit from DHS will not address these suggestions extending the timeline for implementing
10,000 individuals to 10,000 petitions, in this final rule. DHS, however, is the rule would be beneficial. Additional
30,000 individuals, or 10,000 families committed to strengthening the security time would not allow DHS to estimate
(excluding EB–5 derivatives from the and integrity of the immigration system with accuracy how many investors or
EB–5 visa quota); through efficient and consistent projects might be affected by the
• Increasing the number of visas adjudications of benefits and fraud proposal. When the NPRM was
allocated to TEAs; detection. published, DHS invited public
• Allocating 10,000 EB–5 visas for participation, in the form of comments,
rural areas, high unemployment urban G. Public Comments and Responses on
data, and other information, from EB–5
areas, and manufacturing and Statutory and Regulatory
stakeholders. DHS specifically sought
infrastructure projects; Requirements 98
comments on all aspects of the NPRM,
• Increasing administration fees; 1. Data, Estimates, and Assumptions including the economic analysis
• Allocating visas from other visa Used (Executive Orders 12866 and included in the NPRM. DHS believes
categories; and 13563) the 90-day comment period was an
• Recapturing unused visas in any adequate amount of time during which
Comments: Multiple commenters
given year. stakeholders could have submitted data-
discussed the data, estimates, and
Approximately 20 commenters based estimates and information on any
assumptions utilized by USCIS to
discussed fraud and integrity measures or all proposals of the NPRM, as
ascertain the costs of the rule. A
in the EB–5 program. Most of the exemplified by the fact that some
commenter stated that stakeholders
commenters supported the proposed commenters submitted data-based
require additional time to provide data-
rule, but many urged USCIS to go comments. All stakeholders, however,
based estimates regarding economic
further to prevent fraud in the program. had the same opportunity and nearly
impacts of the new investment amounts
Several commenters generally three months to provide data-based
and impacts on jobs. Some commenters
encouraged USCIS to take action to estimates of the potential effects of the
suggested that until additional data
address fraud in the EB–5 program. rule. DHS notes that Section 6 of E.O.
collection and analysis is conducted,
Example areas of fraud identified by 12866 recommends that, in most cases,
the rulemaking should not move
commenters include the following: the comment period be not less than 60
forward. Likewise, several commenters
• Document fraud and money days. In this case, DHS provided the
recommended that DHS withdraw the
laundering; public with approximately 30 more days
proposed rule so that the impacts of the
• EB–5 applicants applying for than recommended, and more time than
rule can be more thoroughly studied,
federal public benefits; and it has in recent years for other rules.
• Evasion of U.S. taxes through including how the proposed rule might
hinder the job benefits estimated by a Because DHS believes the changes to the
failure to disclose fully business profits EB–5 program made by this final rule
earned overseas. study conducted by the Commerce
Department. A commenter suggested are valuable for the reasons described
Several commenters recommended above, it will not delay further the
additional measures USCIS could that DHS did not calculate an expected
cost to stakeholders or the EB–5 effectiveness of the rule in response to
implement to address fraud in the EB– commenters’ requests. DHS appreciates
5 program, including the following: program goals based on the proposed
investment level and TEA definition. all stakeholder feedback it received on
• Audits and site visits not only for the NPRM.
regional center projects, but for The commenter concluded that, given
standalone projects as well; 97 enough time, it was willing to work 2. Costs (Executive Orders 12866 and
• Securities and Exchange with its members to quantify the 13563)
Commission oversight and regulation of impacts of the new investment levels on
ongoing and proposed projects and 2.1. General Economic Costs of the Rule
broker/dealers and agent activities
associated projects. Comments: Many commenters
anywhere investors are being sought;
Response: DHS disagrees with submitted comments concerning the
• Prohibit the sale or rental of
commenters suggesting that either more economic costs of the rule, including
regional centers;
time for comments is required or that it loss of jobs and adverse economic
• Mandatory interviews of immigrant
should withdraw the entire rule to allow impacts. Some commenters believed the
investors within 90 days of filing their
rule’s proposals would have a negative
Form I–829; 98 As noted above, numerous commenters impact on industry, generally impairing
• Disclosure and accounting of expressed concerns that the proposed investment the flow of EB–5 capital to projects in
commissions paid by developers to raise amount increase and TEA reform would disrupt the
the U.S. and hindering job creation and
capital on annual Form I–924A filings; program and reduce the number of projects and
economic growth. A commenter
• Monitor and regulate regional investments under the program. DHS has addressed
these claims in the appropriate portions of the anticipated the proposal would
centers; and preamble above. DHS also addresses some of these adversely affect current and future EB–
comments in the following discussion, because the
97 DHS notes that site visits are currently claims made by the commenters specifically allege
5 projects, while other commenters
conducted on both regional center and standalone potential economic impacts, such as effects on generally lamented the potential loss of
projects. investment and job creation. U.S. jobs. One commenter cited the
Commerce Department study that investments into the U.S.) provided no that a certain loss of EB–5 investment
analyzed the job-creating impact of the objective data to support those claims. necessarily translates to a
investor visa program,99 noting the Like DHS, commenters can only commensurate loss of jobs. Notably, the
study found 11,000 immigrant investors speculate as to precisely how the Commerce Study does not conclude that
provided $5.8 billion in capital for the increases will affect the EB–5 market. the predicted number of jobs expected
FY 2012 and FY 2013, supporting an DHS believes factors other than the to be created through EB–5 funding
estimated 174,039 jobs in the United investment amount significantly would not be created but for the EB–5
States. The commenter stated that these contribute to the program’s utilization. funding. Thus, the Commerce
positive economic impacts of the EB–5 Though the precise impact of the Department study was not helpful in
program are threatened by the rule’s increases on the EB–5 market is evaluating the impacts of the final rule.
proposal to increase the minimum unknowable, DHS believes it is
investment amounts, because such reasonable to increase the investment 2.2. Costs to Investors, Regional Centers
increases would ‘‘discourage investment amounts based on the CPI–U to reflect and New Commercial Enterprises
in American job markets that need it the present-day value of the amounts set Comments: Multiple commenters
most. Investors will have the option of by Congress in 1990 for the reasons discussed costs to investors, regional
going to Australia, or Canada—high discussed earlier in this preamble. centers, and NCEs, generally expressing
income countries with lower visa In addition, DHS acknowledges the concern regarding the impacts the
monetary requirements.’’ The Commerce Department study cited by proposed changes would have on
commenter stated that ‘‘USCIS has been one commenter that analyzed the job- various aspects of the EB–5 program and
unable to determine the possible impact creating impact of the investor visa ability of investors to participate in the
of the new rules.’’ One commenter program. The study did estimate that for program. A commenter warned that the
stated that the proposed increase to the FY 2012 and FY 2013, 11,000 immigrant proposed changes to the minimum
minimum investment amount was too investors provided $5.8 billion in investment amounts would create an
high and would effectively stop the flow capital that was ‘‘expected to create an influx of investment at the current lower
of $2.5 billion in foreign direct estimated 174,039 jobs,’’ 100 but the minimum investment level (in the hope
investments to the United States. study was based on forecasts made in of filing prior to the effective date of the
Response: DHS believes it is economic impact analyses provided by increase). The commenter asserted that
reasonable to increase the minimum petitioners, and not verification of jobs this rush to invest at the current
investment amount to account for actually created.101 DHS notes that the minimum investment levels would be
inflation to ensure the required majority of EB–5 investments have been costly to investors, giving them less time
minimum investment amounts reflect made through regional centers to evaluate projects and trapping the
the present-day dollar value of the (approximately 92 percent, as discussed investors in underperforming projects.
investment amounts established by below). Regional center investments use Relatedly, some commenters expressed
Congress. Given that the minimum methodologies that rely on indirect job concern that changes to the program
investment amounts have not been creation. Such indirect job creation would increase both the petition
increased since the program’s inception, estimates accrue to numerous processing times and the financial
and multiple factors have contributed to downstream industries, and therefore, it burden of obtaining visas, which will
increased or decreased utilization of the is not possible to verify exactly how further discourage investment in
program in the past, DHS cannot many new jobs could be attributed to a American job markets as investors look
accurately predict how the increase to specific EB–5 investment once it is to other options.
the minimum investment amounts will made (it is also possible that indirect job Response: DHS appreciates the
affect demand on the program. DHS forecasts may overstate actual job comments, but notes that it is an
acknowledges that it is reasonable to creation linked to any specific individual investor’s decision as to the
assume some number of investors will investment). The study also includes appropriate timing for his or her
be unwilling or unable to invest at the jobs associated with non-EB–5 investor investment and the individual’s
increased investment amount. However, sources of capital, which is allowed responsibility to evaluate and decide
their capital contributions may very under current regulations.102 Relatedly, whether to invest in specific projects.
well be more than replaced by other the GAO’s audit of EB–5 TEA data in No provision in this rule requires
investors investing at the higher 2016 revealed that in the GAO’s investors to make anything less than
minimum investment levels. In sampling from the fourth quarter of
fully considered and informed
addition, given the oversubscription of fiscal year 2015, the median percentage
investment decisions based on
the program—as long as a sufficient of total potential EB–5 investment in
individual circumstances at the time of
number of investors file petitions each petitioner projects was only 29 percent
the investment. DHS also disagrees that
year to account for the allotment of visas of the total estimated project cost, and
the provisions in this rule will increase
provided by Congress, the program’s the estimated mean percentage was 40
processing times. USCIS works
overall contribution of capital to the percent.103 Because jobs created by non-
diligently to adjudicate and process EB–
U.S. economy will increase. However, EB–5 funding can be credited to EB–5
5 petitions in a timely manner and will
commenters who claim that the investors, and many projects could still
continue to do so following the changes
increases to investment amounts will be viable without EB–5 funding given
that such funding makes up only a made in this final rule. In addition,
have a significant negative impact (e.g., USCIS has considered its staffing needs
the claim that the investment increase portion of overall funding, DHS does
following the promulgation this rule,
would stop $2.5 billion in foreign direct not believe it is reasonable to assume
and will remain attentive to such needs
99 Estimating the Investment and Job Creation 100 Id.
at 1–2. in the course of implementation of this
Impact of the EB–5 Program, Economics & Statistics 101 Id.
at 7. rule.104 Finally, as mentioned in several
Administration, Office of the Chief Economist, U.S. 102 8 CFR 204.6(g)(2).
Department of Commerce (2017), available at 103 GAO, Immigrant Investor Program: Proposed 104 See USCIS, EB–5 National Stakeholder
https://www.commerce.gov/sites/commerce.gov/ Project Investments in Targeted Employment Areas, Engagement Talking Points by IPO Acting Chief
files/migrated/reports/estimating-the-investment- GAO–16–749R, Published Sept. 19, 2016, available Julia Harrison (hereinafter ‘‘Harrison Talking
and-job-creation-impact-of-the-eb-5-program_0.pdf. at http://www.gao.gov/products/GAO-16-749R. Points’’) (Nov. 7, 2017), available at http://ilw.com/
earlier instances, DHS believes the exactly how many potential investors final rule will retain the 50 percent
increase in the investment amount is may be deterred from the program due differential between the general and
appropriate and that the EB–5 program to the rule’s provisions or how regional reduced investment amount and set the
will remain competitive relative to other centers may respond if some investors latter at $900,000. In response to the
countries’ immigrant investor programs. may be unable or unwilling to invest at comment, a general analysis conducted
Comments: Several commenters the higher minimum investment by DHS reveals that it would take a
stated that they anticipated that a amounts. substantial reduction in the number of
reduction in investors caused by the investors in order for TEA investment to
increased investment amount would 2.3. Costs of Increasing the Investment
decline taken in total. Adjusting the
ultimately put several of the regional Amounts
9,238 investments total from above for
centers out of business, noting that one Comments: Many commenters the TEA portion of all investments, 96
of the costs laid out by DHS in the discussed the costs of increasing the percent (discussed below), yields 8,868
NPRM is that some investors may not be investment amounts. Overall, the annual TEA investments amounting to
able or willing to invest at the proposed majority of commenters suggested that $4.43 billion in investment. At the TEA
higher investment level. Similarly, one changing the investment amounts investment amount of $900,000 in this
commenter suggested that raising the would result in a contraction of the EB– final rule, this same level of total TEA
investment amount increases an 5 program and lead to job loss, with investment would be achieved with
investor’s perception of risk in the commenters writing that the future 4,927 investors, which represents 44
investment, which would reduce marketability of the program is in percent fewer investors. Furthermore,
interest in the program, therefore forcing jeopardy. A commenter noted that small and even moderate reductions in
regional centers out of business. raising minimum investment amounts investors actually stand to generate
However, the commenters did not could possibly result in lower growth in total investment. For
provide verifiable evidence or data to investment levels in absolute terms example, investor declines of 10, 20,
support the claims. depending on how much demand is and 30 percent would grow aggregate
Response: In the NPRM, DHS reduced by raising the minimum TEA investment 62, 44, and 26 percent,
discussed the difficulties of quantifying investment amount. The same respectively. Investor declines would
the impacts of the rule’s provisions on commenter noted giving the largest however result in reductions in the total
EB–5 entities due to the absence of data, price hike to investors in targeted numbers of jobs required to be created.
such as data on regional center employment areas may not be wise from We emphasize that this analysis does
operating revenues. DHS wrote that it is an economic perspective, as those are not reflect DHS predictions about what
reasonable to assume that the changes in likely to be the more price-sensitive will happen to investment levels or job
the investment amounts may affect investors. creation, but is intended to convey,
some regional centers, but that it was Response: DHS recognizes that it is generally, that based on the number of
not possible to predict the extent of possible that the absolute amount of investors alone, it would take a
those impacts. In the Final Regulatory investment could decrease if the substantial reduction to actually reduce
Flexibility Analysis (FRFA) proportionate decline in investments TEA total investment from recent levels.
accompanying this final rule, DHS again outweighs the proportionate increase Thus, while DHS believes it is
discusses the rule’s potential impacts on from the higher investment amount. Of possible that some investors may be
regional centers, albeit mainly in the course, it could also increase. For deterred from investing at the higher
context of whether or not regional example, there were an average of 9,238 amount, evidence or data has not been
centers can be classified as small approved Form I–526 petitions annually provided by commenters to suggest that
entities. That discussion, however, is from 2015–2017. If the 80 percent the decrease in demand would be as
relevant to the commenter’s concerns. In higher levels of required investment do significant as claimed. In the absence of
that section, DHS recognizes that the not lead to a reduction in the number data indicating whether the final rule
increase in the investment amount of EB–5 investments, the absolute will lead to a decrease in overall
could deter some investors, but asserts amount of investment would increase investment, and by how much, DHS
that it cannot determine with accuracy by 80 percent.105 As is described in the believes it is reasonable to raise the
the quantitative effects of the rule, preamble above, DHS considered the minimum investment amounts, which
because it is not possible to know public comments and as a result, this have remained unchanged for decades,
for the reasons already addressed.
immigrationdaily/news/20171206.pdf (‘‘[w]e had 105 This calculation assumes that the proportion Finally, as it pertains to the reduced
just created a division of Adjudicators and of TEA and non-TEA investments will be the same investment amount of $1.35 million in
Economists who would focus on the I–829 going forward. Based on an average of 9,238 annual the proposed rule and the $900,000
adjudications and customer service inquiries. I am investments, with 96 percent in TEAs and 4 percent amount contained in this final rule,
happy to share that this restructuring has paid off. not in TEAs yields 8,868 investments made at
The collaboration and cross training of the $500,000 and 370 made at $1,000,000, for a total of DHS does not have enough information
Adjudications Officer and Economist have $4.80 billion. Taking these same numbers of or data to predict the likely difference
contributed to a reduction in the I–829 processing investments made at the new amounts, 900,0000 in aggregate investment as a result of
time. It’s just one month so far but I expect that and 1,800,000, respectively, yields a new amount of DHS’s determination to use the
trend to continue in FY2018 . . . A year ago it took $8.65 billion in investment, which is an 80 percent
us on average 20 days to resolve a customer inquiry. increase (calculation: (8.65/4.80)¥1). There could $900,000 amount. Total TEA investment
Now it takes us about 5 days to respond to be variation to these amounts. If, for example, a at the $900,000 level this rule finalizes
inquiries, some of which are resolved within that higher percentage of investments were in non-TEA could be greater or smaller than at the
time frame . . . Building on the success of the I– projects (since fewer projects would qualify for TEA
initially proposed $1.35 million.

829/Customer Service team, during the last half of status under the new standard), the increase in total
FY2017, IPO launched a multidisciplinary team investment would be even higher. If, due to this
Comments: One commenter cites to a
made up of Economists and Adjudications Officers rule or other circumstances, a higher proportion of specific report, the 2016 World Wealth
to focus on the Form I–526 adjudication . . . Some investments are made into TEAs, then total Report, and stated that 90 percent of
of the near term benefits gained from the new team investment could decline, although more high net worth individuals globally
include: The potential for an increase in staffing investment would flow to targeted areas. Since DHS
capacity and knowledge gained through training cannot accurately forecast the ultimate effects on
have a net worth of $5 million or less.
and the expansion of current employees’ skill sets. projects or their composition in terms of targeted The commenter further stated that such
This will allow IPO to better meet our mission.’’). areas, both possibilities exist. individuals will allocate up to 25
percent of their net worth to ‘‘long term, high for investors. Based on those assertions that demand would fall to a
low yield’’ investment. The commenter assumptions, the commenters estimated specific historical level based on price
recognized that EB–5 investors do not that the number of petitions would drop alone with a valid methodological
necessarily have the same investment by 88 percent when compared to the approach.
preferences (e.g., EB–5 investors ‘‘may number of petitions filed in 2011 and 97 Similarly, a commenter reported that,
well commit a significantly higher percent when compared to the number based on an informal survey of potential
amount just to reach their goal of U.S. of petitions filed in 2016. The investors, the proposed increases would
permanent residence’’). The commenter commenters concluded that the reduced reduce investors’ ability and willingness
estimated based on the above, and interest would be damaging to the U.S. to participate in the program. Although
practical experience, that investors with economy and reduce the number of jobs the commenter does not provide
a net worth as low as $1.5 million have created by the EB–5 program. substantive data or analysis to support
been willing to commit $500,000 in In addition, one commenter stated their claim, DHS recognizes that many
support of their immigration goals. The that it had asked ‘‘many potential potential EB–5 investors may prefer to
commenter suggested that if DHS investors and others about the impact of have as small a required investment
increases the minimum investment [the proposed] investment amounts on amount as possible, but may be
amounts as proposed, ‘‘most in this their interest and/or ability to invest in prepared to invest more if necessitated
category will not be willing to the [United States].’’ The commenter by law. DHS also acknowledges that
participate in the program.’’ reported that ‘‘[t]he proposed increase there could be a decline in investors.
Response: DHS disagrees that the would drastically reduce potential However, in the absence of objective
commenter’s assumptions about the investors’ interest and ability to invest.’’ evidence on the impacts of the proposed
willingness of investors to invest at the DHS notes that the commenter increases on demand, DHS believes that
increased investment amounts is referenced the specific proposed it is reasonable to increase the minimum
sufficiently supported by the source investment level of $1.35 million, but investment amounts to account for
cited. The comment relies on the report our response is not different in the inflation for the reasons stated
for the finding that 90 percent of high context of finalizing the reduced elsewhere, and to make future inflation
net-worth individuals have a net worth investment level of $900,000. adjustments based on the initial amount
of $5 million or less, and states, without Response: DHS disagrees with the set by Congress in 1990.
support, that the majority of EB–5 commenters’ basic premise that lower
utilization of the program in the 1990s 2.4. Costs of Shifting the TEA
investors fall into this category. The
was solely because even the reduced Designation Responsibility From States
commenter also relies on either the
minimum investment amount was too to USCIS
report or unnamed studies for the
assertion that such investors will high for investors. Rather, as discussed Comment: One commenter suggested
allocate up to 25 percent of their net in previous sections, DHS has reason to that the proposal to eliminate state
worth to ‘‘this type of investment (long- believe use of the program over time has involvement in the TEA designations
term, low-yield)’’, and states, without been affected by a range of factors, has the potential to reduce costs for the
accompanying citations or other including administration of the industry. The same commenter,
support, that EB–5 investors would be program, stakeholder confidence, and however, wrote that USCIS should
willing to invest up to one-third of their changes in the U.S. economy. For consider some process for local
total net worth. DHS believes the example, the CIS Ombudsman involvement in unusual circumstances.
commenter’s assumptions are concluded in 2009 that the lower Response: DHS agrees that the change
inadequately supported. In addition, the utilization level was ‘‘principally in the process for TEA designation has
commenter does not explain why EB–5 caused by significant regulatory and the potential to reduce costs for the
investments can be accurately described administrative obstacles, as well as industry. DHS, however, rejects the
as long-term 106 and low yield or how uncertainties that undermine investor commenter’s suggestion that there
EB–5 investments are comparable to and stakeholder confidence.’’ 107 In should continue to be local involvement
other types of investments, and also addition, Congress never chose to in TEA designation. As discussed in
fails to quantify the other factors that decrease the minimum required earlier comment responses,
may motivate an EB–5 investment based investment amounts during the years in congressional intent of the TEA
on objective data. Thus, the comment which the program was provision was to incentivize EB–5
does not establish a clear relationship undersubscribed for any reason, investment in areas of actual high
between the report cited and the including in order to specifically unemployment. Currently, the states’
quantitative estimates provided in the encourage more utilization of the dual role in both TEA designation and
comment. program. And as the minimum promoting investment within their
Comments: Some commenters investment amounts have not changed borders incentivizes states to secure
contended that DHS’s proposed since the program’s inception, DHS TEA designations through
increases to the minimum investment cannot predict with certainty what the ‘‘gerrymandering’’ without due regard
amounts would cause the number of impacts of the changes will be, with for whether the designated area truly is
EB–5 investors interested in respect to both the number of investors experiencing high unemployment. For
participating in the program to return to willing to participate in the program these reasons, DHS has determined that
the levels from the 1990s. These and any changes in potential job it is necessary to shift the TEA
commenters pointed to low utilization creation. DHS acknowledges that the designation mechanism from the states
of the program during that time and higher investment amounts could deter to DHS.
stated that even the reduced minimum some portion of investors. However,
investment amount of $500,000 was too commenters do not support their 2.5. Costs to USCIS
Comments: A few commenters
106 In fact, to be eligible for removal of conditions 107 CIS Ombudsman, Employment Creation
provided input on potential costs to
on their permanent residence status, EB–5 investors Immigrant Visa (EB–5) Program Recommendations, USCIS. One commenter noted that the
need only sustain their investment for the two-year March 18, 2009, at *17, available at https://
period of conditional residence beginning on the www.dhs.gov/xlibrary/assets/CIS_Ombudsman_EB- rulemaking would extend processing
date they obtain that status. 5_Recommendation_3_18_09.pdf. times, requiring an increase in USCIS
adjudicator staffing. Similarly, another workload. DHS therefore believes the enhancement. . . .’ ’’110 EB–5 capital
commenter wrote the rule would add operational burden for USCIS to create has also been characterized as ‘‘lower-
TEA designation to an already and publish a census tract-based map of cost capital with favorable terms.’’111
overwhelmed and short-staffed the United States would be prohibitive Further, DHS has no way to estimate
adjudications team. Conversely, a few and redundant given that this type of when and how such other sources of
commenters suggested that the data is publicly available to use in capital may be used to offset any
increased investment amounts will calculating the unemployment rate for a potential loss of EB–5 capital
drastically reduce the number of particular area. investment. DHS further believes the
investors, which would in turn reduce increases in the investment amount will
the workload for USCIS adjudicators. 3. Other Impacts (Executive Orders bring the investment amounts from 1990
Regarding the proposal to eliminate 12866 and 13563) in line with their real values today and
state involvement in the designation of 3.1. Impacts on the Number of Projects EB–5 capital will continue to be an
high unemployment areas, a commenter Receiving EB–5 Capital important source of investment for
suggested DHS consider the increase in projects.
USCIS workload that would result. The Comments: Some commenters 3.2. Impacts on Particular Sectors of the
commenter stated that USCIS should discussed impacts the proposed Economy and Geographic Areas
publish a ‘‘census tract-based depiction regulation would have on the number of
of the entire U.S, so regional centers and projects receiving EB–5 capital. Comments: Some commenters
developers can begin planning for the Commenters, including regional centers discussed sectors of the economy and
implementation of the new regulation.’’ and individuals, expressed general geographic areas that may be
The commenter suggested that USCIS concern that the increase in minimum disproportionately affected by the
should consider the resources required proposed rule. One commenter worried
investment amount would adversely
to produce such a publication. that certain industries, such as
affect current and future EB–5 projects
Response: DHS appreciates transportation and non-profit industries,
by decreasing capital available to the
commenters’ concerns over USCIS ‘‘where conventional capital is almost
EB–5 program participants. A couple of
staffing issues, but conveys to the public impossible,’’ have utilized EB–5 capital
other commenters expressed concern
that at a very broad level, staffing and in order to survive and create jobs.
that the lack of EB–5 investors would Some commenters expressed concern
adjudication time were considered prevent projects from moving forward
when the rule was proposed. that the proposed rulemaking
due to the lack of needed capital. (specifically, removing the ability for
Additionally, USCIS conducts a fee
study on a biennial basis which takes Response: As mentioned in the states to designate TEAs) would
into consideration volume projections of NPRM, due to the absence of data, DHS negatively affect job growth and
forms and staffing levels, among other is unable to determine the number of wellbeing of areas that need economic
things.108 USCIS staffing level plans are, current or future projects that may be development the most, notably rural
in part, based on these studies in negatively affected by the rule’s areas and high unemployment areas.
conjunction with anticipated regulatory provisions. This is in large part because Another commenter suggested that the
changes. Further, as noted above, DHS does not have data to estimate how proposed increase for TEA projects
USCIS’ Immigrant Investor Program this rulemaking or other factors may would unfairly affect the ability of rural
Office (IPO) has restructured into influence potential future investors’ projects to compete with projects in
multidisciplinary teams, which reduced behavior. In the NPRM, DHS wealthy census blocks of the U.S. cities,
Form I–829 adjudication times, and acknowledges that it is reasonable to as well as other countries, and proposed
launched a similar initiative for Form I– suggest that some individuals may be that the TEA investment amount
526 adjudications in late 2017.109 deterred from investing at the increased increase to no more than $800,000, and
Finally, DHS rejects the commenter’s investment amounts, and therefore some be maintained at 50% of the standard
suggestion that USCIS create and projects may be affected. DHS notes, investment amount.
however, that at the increased Response: Business plans and
publish a census tract-based depiction
investment amounts projects will have economic analyses submitted to DHS
of the entire United States. Foremost,
to recruit fewer EB–5 investors to meet associated with EB–5 petitions involve
census tract maps and unemployment
the same capital funding needs. DHS many industries and project types, and
data are otherwise publicly available,
also notes that, even where a project DHS does not dispute the commenter’s
and it will be up to the petitioner to
may not be able to obtain the full claim that conventional financing may
submit reliable and verifiable evidence
amount of EB–5 capital originally be difficult to obtain in some sectors.
to demonstrate that his or her
contemplated, there may be other However, the commenter submitted no
investment is within a TEA. See final 8
sources of potential capital that could be credible information or data to support
CFR 204.6(j)(6)(ii)(B). In addition, the
drawn upon to satisfy a given project’s the claim that the proposed changes to
commenter raises concerns over the
capital needs (for example, bank the program would cause a significant
increased workload to DHS involved in
financing, non-EB–5 equity investment, reduction in investment and job
taking over TEA designations from
etc.), although the financing from other creation to a particular industry or the
states, but does not say how publishing
sources could be costlier in terms of economy overall. DHS reiterates that the
a map would increase or decrease the
interest and other fees. One of the prime popularity and growth of the EB–5
108 In accordance with the requirements and advantages of EB–5 capital for program has likely been driven by
principles of the Chief Financial Officers Act of developers is that it can entail a low
1990, 31 U.S.C. 901–03, (CFO Act), and Office of 110 Eliot Brown, ‘‘How a U.S. Visa-for-Cash Plan
Management and Budget (OMB) Circular A–25,

cost of capital. ‘‘Many of such projects Funds Luxury Apartment Buildings; Program Meant
USCIS reviews the fees deposited into the could easily have been financed on the to Spur Jobs in Poor Areas Largely Financed
Immigration Examinations Fee Account (IEFA) private market, according to [New York Developments in Affluent Neighborhoods,’’ Wall St.
biennially. University Stern School of Business J., Sept. 9, 2015, available at https://www.wsj.com/
109 See Harrison Talking Points, available at articles/how-immigrants-cash-funds-luxury-towers-
http://ilw.com/immigrationdaily/news/
scholar-in-residence] Gary in-the-u-s-1441848965 (last visited Dec. 17, 2018).
20171206.pdf. Friedland. . . . ‘It’s a profit 111 Id.
numerous factors, including but not requirements lacked a sound economic Response: As noted above, Congress
limited to, its sourcing of capital or labor market rationale or basis, and enacted the investor visa program to
funding for projects across U.S. would result in loss of economic attract entrepreneurs and job-creators
industries. GAO’s analysis—taken from projects, investment, and potential job into the U.S. economy 113 and infuse
a random sample of 200 of the 6,652 creation opportunities. Some new capital into the country.114
petitions submitted by petitioners to commenters stated that the increased Congress did not specify any particular
participate in the EB–5 program in the investments and designation for TEAs type of investor it was seeking.115 As
fourth quarter of fiscal year 2015— would ‘‘destroy’’ the EB–5 program. discussed previously, DHS believes that
estimated that of the 99% of EB–5 Another commenter proposed that the the increase to the minimum investment
petitioners who elected to invest in a TEA designation requirements should amount is appropriate because inflation
TEA, about 3% chose to invest in rural ensure that urban and rural projects are has eroded the present-day value of the
areas and about 97% chose to invest in provided equal opportunity to improve minimum investment required to
a high unemployment area (GAO noted their communities through job creation. participate in the EB–5 program since
that the percentages do not add up to 99 Response: DHS disagrees with the Congress set the initial investment
due to rounding), and of the EB–5 commenter that the new TEA amounts in 1990, and this final rule is
petitioners who elected to invest in high requirements are arbitrary or would an effort at remedying that erosion. In
unemployment areas, only 12% randomly exclude high unemployment addition, DHS believes the increased
invested in projects actually located in areas. On the contrary, DHS believes the amount will attract the same type of
census tracts where the unemployment new high unemployment area investment levels that Congress
rate was over 8%.112 Thus, given that designation standard brings clarity and intended to attract in 1990.
only a small minority of investments are consistency to a process that lacked DHS recognizes that many EB–5
currently being made in either a rural uniformity nationwide. In developing petitioners do not necessarily take an
area or a project located in census tracts the proposed high unemployment area entrepreneurial role in the operations of
with an unemployment rate of over 8%, standard, DHS sought to ensure the their new commercial enterprise;
even though over 30% of visas (3,000 designation is made in a transparent and however, the EB–5 program has been
out of 9,940) are statutorily reserved for objectively defined manner, and not one and may continue to be used by
investments in TEAs, it is very possible in which the rules are subject to shifting petitioners who do take an
that the reforms contained in this rule applications by the states or other entrepreneurial role in the operations of
will increase the percentage of EB–5 interested entities based on economic, their new commercial enterprise.
capital going towards rural areas and political, or other rationales, some of Moreover, under the current regulatory
areas of true high unemployment. which may be unrelated to incentivizing and statutory regime, the EB–5 program
Additionally, and as discussed in EB–5 investment in areas of true high contains no specific entrepreneurship
earlier comment responses, DHS agrees unemployment. DHS disagrees that the requirements. DHS does not
that not enough EB–5 investment has new TEA designation standard, as it differentiate between and collects no
gone to rural areas and areas of truly applies to either or both the TEA data on petitioners who take an
high unemployment. The changes made geography reform or the TEA entrepreneurial role in the operations of
in this rule to the TEA designation investment amount increase, will their new commercial enterprise relative
process, and DHS’s decision to maintain destroy the EB–5 program, and notes to those who do not. Accordingly, DHS
the differential between the investment that the commenter provides no credible has no data to support and there is no
tiers at 50% (as one commenter evidence or information to support their persuasive reason to believe that raising
suggested), or $900,000, were intended assertion. As noted in other instances in the minimum investment amount would
to better reflect Congressional intent the preamble, we believe there will disproportionately decrease the number
with respect to incentivizing continue to be sufficient interest in the of petitioners who take an
investments in these areas.. In addition, EB–5 program notwithstanding the entrepreneurial role in their new
the higher minimum investment amount changes. Additionally, DHS adopts the commercial enterprise relative to those
will mean that more capital per investor new requirements to better align TEA who do not.
is being infused into those areas, and designation requirements with
Congressional intent and to ensure both 4. Other Comments on the Regulatory
with the changes to the TEA designation Impact Analysis (Executive Orders
process, DHS expects that more capital urban and rural areas are provided
appropriate opportunity to be 12866 and 13563)
overall will be infused in areas of truly
high unemployment. designated as TEAs (and qualify for the Comments: Approximately 10
reduced minimum investment amount commenters provided other input on the
3.3. Impacts of Change in the TEA incentive) in order to attract EB–5 Regulatory Impact Analysis. One
Designation Standard capital funding. commenter asserted that DHS has not
Comments: Several commenters 3.4. Other Comments on Impacts fulfilled its obligation, under Executive
addressed impacts of the proposed Orders 12866 and 13563, to share how
Comments: One commenter stated it weighed the option to pursue
changes to the TEA designation
that increasing the investment amounts regulatory action as opposed to not
standard. A commenter stated that the
would negatively affect the ability of taking action while Congress works to
proposed TEA requirement would
mid-career professionals and pursue partial reforms using the
arbitrarily exclude lower unemployment
entrepreneurs to participate in the EB– legislative process. According to the
areas that would otherwise attract a
5 program and this impact would
significant number, if not the majority, commenter, it is counterproductive to

deprive the economy of potential revise vital components of the program
of their workers from nearby higher
contributions of these younger while Congress is debating possible
unemployment areas. The commenter
investors. The commenter presented program reforms. Another commenter
stated that the proposed designation
anecdotal evidence to support the claim
112 GAO, Immigrant Investor Program: Proposed that investors would be less interested 113 136 Cong. Rec. 35,615 (Oct. 26, 1990).
Project Investments in Targeted Employment Areas, and less able to invest at the higher 114 S.Rept. 101–55, p. 21 (1989).
GAO–17–487T, at 4–5, 8 (table 1) (Mar. 8, 2017). investment amounts. 115 136 Cong. Rec. 35,615.
said the impact analysis should be finalizing this NPRM to implement Additionally, for the purposes of the
rejected as being an incomplete and not needed reforms in a timely manner. UMRA of 1995, this rule does not
fully-considered analysis of the Promulgation of these regulatory change impose costs exceeding the threshold of
implications of the proposed increases does not preclude legislative changes by $100 million (or the inflation-adjusted
in the proposed minimum investment Congress. value equivalent of $100 million in 1995
amounts. 5. Comment on Unfunded Mandates dollars).
Response: The commenters appear to
Reform Act (UMRA) IV. Statutory and Regulatory
misunderstand the requirements of the
Executive Orders. Executive Order Comment: One commenter disagreed Requirements
12866 is an exercise of the President’s with DHS that no unfunded mandates A. Executive Orders 12866 (Regulatory
authority to manage the Executive exist in the proposed rule. According to Planning and Review), 13563
Branch of the United States under the commenter, states have developed (Improving Regulation and Regulatory
Article II of the Constitution. The systems to track and review portions of Review), and 13771 (Reducing
implementation of the Executive Orders the EB–5 program as it relates to their Regulation and Controlling Regulatory
and OMB Circulars, and other internal state. The commenter provided Costs)
guidance, is a matter of Executive background regarding the State of
California’s process for analyzing Executive Orders 12866 and 13563
Branch consideration and discretion. direct agencies to assess the costs and
The fact that preparation of a regional center information and
determining census tracts that would benefits of available regulatory
regulatory impact analysis (RIA) under
qualify as areas of high unemployment. alternatives and, if regulation is
Executive Order 12866 is a matter of
The commenter suggested that the necessary, to select regulatory
Executive Branch discretion is
proposed federalization of the approaches that maximize net benefits
underscored by the terms of Executive
designation of high unemployment (including potential economic,
Order 12866, section 10, which provides
areas would eliminate the state-based environmental, public health and safety
that nothing in the Executive order shall
processes. The commenter urged DHS to effects, distributive impacts, and
affect any otherwise available judicial
consult with California and other states equity). Executive Order 13563
review of agency action. The Executive
with unique regulatory frameworks emphasizes the importance of
Order is intended only to improve the
prior to transitioning, and suggested quantifying both costs and benefits, of
internal management of the Federal
governors and mayors also be consulted reducing costs, of harmonizing rules,
Government and does not create any
to determine the needs of their and of promoting flexibility. Executive
right or benefit, substantive or
respective states and cities. Order 13771 (‘‘Reducing Regulation and
procedural, enforceable at law or equity
Response: DHS disagrees with the Controlling Regulatory Costs’’) directs
by a party against the United States, its
commenter that unfunded mandates are agencies to reduce regulation and
agencies or instrumentalities, its officers
imposed by this final rule. The UMRA’s control regulatory costs.
or employees, or any other person.
written statement requirements apply This rule has been designated a
The internal, managerial nature of this
when a Federal mandate is likely to ‘‘significant regulatory action’’—
and other similarly worded Executive
result in the expenditure by State, local, although not an economically
Orders has been recognized by the
and tribal governments, in the aggregate, significant regulatory action—under
courts, and actions taken by an agency
or by the private sector, of $100,000,000 section 3(f) of Executive Order 12866.
to comply with the Executive Order are
or more (adjusted annually for inflation) Accordingly, the rule has been reviewed
not subject to judicial review. Cal-
in any 1 year. 2 U.S.C. 1532(a). A federal by the Office of Management and
Almond, Inc. v. USDA, 14F.3d 429, 445
intergovernmental mandate means any Budget. This rule is a regulatory action
(9th Cir. 1993) (citing Michigan v.
provision in legislation, statute, or under Executive Order 13771.
Thomas, 805 F.2d 176,187 (6th Cir.
1986)). regulation that would impose an (1) Summary
DHS made a good faith effort to enforceable duty upon State, local, or
tribal governments (except certain This final rule changes certain aspects
analyze the impacts of this rule. DHS
conditions of Federal assistance or of the EB–5 program that are in need of
reviewed numerous studies and
duties arising from participation in a reform and updates the regulations to
requested comment from the public but
voluntary Federal programs). 2 U.S.C. reflect statutory changes and codify
received no credible data or information
658(5)(A). While one state might have existing policies. This final rule makes
that would provide a more accurate
voluntarily developed a system to track five major categories of revisions to the
estimate of the impacts.
and review portions of the EB–5 existing EB–5 program regulations.
DHS also disagrees that the current
program, this rule does not create any Three of these categories, which involve
rulemaking is counterproductive when
enforceable duties. See id.; 2 U.S.C. (i) priority date retention; (ii) increasing
legislative reforms are under
1555. Furthermore, by eliminating state the investment amounts; and (iii)
consideration. As mentioned in an
designation of high unemployment reforming the TEA designations, are
earlier comment response, some
areas, DHS is assuming the substantive. The two other major
members of Congress, commenting on
administrative burden (and relieving categories focused on (iv) procedures for
this rule, requested that DHS take this
states of the burden) of determining removal of conditions on lawful
regulatory action in part because of
which areas qualify as TEAs, rather than permanent residence; and (v)
Congress’ inability to enact legislative
relying on state designations. miscellaneous changes, involve
reforms over the 114th and 115th
generally technical adjustments to the
Congresses. In fact, the Chairs of the

EB–5 program. Details concerning these
House and Senate Judiciary Committees Regulations, End Unacceptable Status Quo, (March
22, 2018) available at https://judiciary.house.gov/ three major substantive and two major
noted that ‘‘Congress has failed to
press-release/goodlatte-grassley-call-dhs-finalize- technical categories of changes are
reform’’ the EB–5 program.116 DHS is eb-5-regulations-end-unacceptable-status-quo/. provided in above sections, and in Table
Senator Grassley had noted a few days earlier that
116 U.S. Senator Charles Grassley, U.S. members of Congress had been working on reform
2 in terms of benefit-cost considerations.
Representative Bob Goodlatte, Press Release: aggressively for years, but to no avail. See 164 Cong. Within the five major categories of
Grassley, Goodlatte Call on DHS to Finalize EB–5 Rec. S1778 (March 19, 2018). revisions to existing regulations, this
final rule also makes some changes from in this rulemaking will not downstream economic impacts driven
the NPRM. Most importantly, the independently result in denial or by these major provisions.
reduced investment amount for TEAs revocation of a petition, provided the There are several costs involved in the
will be raised to $900,000 instead of the petition meets certain criteria; and
final rule for which DHS has conducted
proposed $1.35 million, in order that • Additional minor non-substantive
quantitative estimates. For the technical
the 50 percent differential between and clarifying changes.
investment tiers be maintained. The DHS analyzed the five major revision that clarifies that derivative
other nonsubstantive changes between categories of revisions carefully. EB–5 family members must file their own
this final rule and the NPRM are listed investment structures are complex, and petitions to remove conditions on their
here: typically involve multiple layers of permanent residence when they are not
• Clarification that the priority date of investment, finance, development, and included in the principal investor’s
a petition for classification as an legal business entities. The petition, we estimate costs to be
investor is the date the petition is interconnectedness and complexity of approximately $91,023 annually for
properly filed; such relationships make it very difficult those derivatives. Familiarization costs
• Clarification that a petitioner with to quantify and monetize the costs and to review the rule are estimated to be
multiple approved immigrant petitions benefits. Furthermore, since demand for $629,758 annually.
for classification as an investor is EB–5 investments incorporate many In addition, DHS has prepared a Final
entitled to the earliest qualifying factors related to international and U.S.
Regulatory Flexibility Analysis (FRFA)
priority date; specific immigration and business, DHS
under the Regulatory Flexibility Act
• Modifying the original proposal that cannot predict with accuracy changes in
any city or town with a population of demand for the program germane to the (RFA) to discuss potential impacts to
20,000 or more may qualify as a TEA, major categories of revisions that small entities. As discussed further in
to provide that only cities and towns increase the investment amounts and the FRFA, DHS cannot estimate the
with a population of 20,000 or more reform the TEA designation process. exact impact to small entities. DHS,
outside of metropolitan statistical areas DHS has no way to assess the potential however, does expect some impact to
(MSAs) may qualify as a TEA; increase or reduction in investments regional centers and non-regional center
• Adding that amendments or either in terms of past activity or projects. As it relates to the FRFA, each
supplements to any offering necessary forecasted activity, and cannot therefore of 1,570 business entities involved in
to maintain compliance with applicable quantitatively estimate any impacts familiarization of the rule would incur
securities laws based upon the changes concerning job creation, losses or other costs of about $401.
TABLE 2—SUMMARY OF CHANGES AND IMPACT OF THE ADOPTED PROVISIONS
Priority Date Retention
Current DHS regulations do not permit investors to DHS will allow an EB–5 immigrant petitioner to use Benefits:
use the priority date of an immigrant petition ap- the priority date of an immigrant petition approved • Makes visa allocation more predictable for in-
proved for classification as an investor for a subse- for classification as an investor for a subsequently vestors with less possibility for large fluctua-
quently filed immigrant petition for the same classi- filed immigrant petition for the same classification tions in visa availability dates due to regional
fication. for which the petitioner qualifies, unless DHS re- center termination.
vokes the petition’s approval for fraud or willful • Provides greater certainty and stability regard-
misrepresentation by the petitioner, or revokes the ing the timing of eligibility for investors pur-
petition for a material error. suing permanent residence in the U.S. and
thus lessens the burden of unexpected
changes in the underlying investment.
• Provides more flexibility to investors to con-
tribute to more viable investments, potentially
reducing fraud and improving potential for job
creation.
Costs:

Increases to Investment Amounts
The standard minimum investment amount has been DHS will account for inflation in the investment Benefits:
$1 million since 1990 and has not kept pace with amount since the inception of the program. DHS • Increases in investment amounts are nec-
inflation—losing almost half its real value. will raise the minimum investment amount to $1.8 essary to keep pace with inflation and real
Further, the statute authorizes a reduction in the min- million to account for inflation through 2015, and value of investments;
imum investment amount when such investment is includes a mechanism to automatically adjust the • Raising the investment amounts increases the
made in a TEA by up to 50 percent of the standard minimum investment amount based on the amount invested by each investor and poten-
minimum investment amount. Since 1991, DHS unadjusted CPI–U every 5 years. tially increases the total amount invested
regulations have set the TEA investment threshold DHS will retain the TEA minimum investment amount under this program.
at 50 percent of the minimum investment amount. at 50 percent of the standard amount. The min- • For regional centers, the higher investment
Similarly, DHS has not increased the minimum invest- imum investment amount in a TEA will initially in- amounts per investor will mean that fewer in-
ment amount for investments made in a high em- crease to $900,000. vestors will have to be recruited to pool the
ployment area beyond the standard amount. DHS is not changing the equivalency between the requisite amount of capital for the project, so
standard minimum investment amount and those that searching and matching of investors to
made in high employment areas. As such, DHS projects could be less costly.
will set the minimum investment amounts in high Costs:
employment areas to be $1.8 million, and follow • Some investors may be unable or unwilling to
the same mechanism for future inflationary adjust- invest at the higher levels of investment.
ments. • There may be fewer jobs created if fewer in-
vestors invest at the higher investment
amounts.
• For regional centers, the higher amounts could
reduce the number of investors in the global
pool and result in fewer investors, thus poten-
tially making the search and matching of in-
vestors to projects more costly.
• Potential reduced numbers of EB–5 investors
could prevent certain projects from moving for-
ward due to lack of requisite capital.
• An increase in the investment amount could
make foreign investor visa programs offered
by other countries more attractive.
TEA Designations
A TEA is defined by statute as a rural area or an area DHS will eliminate state designation of high unem- Benefits:
that has experienced high unemployment (of at ployment areas. DHS also amends the manner in • Rules out TEA configurations that rely on a
least 150 percent of the national average rate). which investors can demonstrate that their invest- large number of census tracts indirectly linked
Currently, investors demonstrate that their investments are in a high unemployment area. to the actual project tract by numerous de-
ments are in a high unemployment area in two (1) DHS will add cities and towns with a popu- grees of separation.
ways: lation of 20,000 or more outside of MSAs as a • Potential to better stimulate job growth in
(1) providing evidence that the Metropolitan Sta- specific and separate area that may qualify as areas where unemployment rates are the high-
tistical Area (MSA), the specific county within a TEA based on high unemployment. est, consistent with congressional intent.
the MSA, or the county in which a city or town (2) DHS will amend its regulations so that a TEA Costs:
with a population of 20,000 or more is located, may consist of a census tract or contiguous • This TEA provision could cause some projects
in which the new commercial enterprise is prin- census tracts in which the new commercial en- and investments to no longer qualify as being
cipally doing business, has experienced an av- terprise is principally doing business if in high unemployment areas. DHS presents
erage unemployment rate of at least 150 per- • the new commercial enterprise is located the potential number of projects and invest-
cent of the national average rate; or in more than one census tract; and ments that could be affected in Table 5.
(2) submitting a letter from an authorized body of • the weighted average of the unemploy-
the government of the state in which the new ment rate for the tract or tracts is at least
commercial enterprise is located, which cer- 150 percent of the national average.
tifies that the geographic or political subdivision (3) DHS will also amend its regulations so that a
of the metropolitan statistical area or of the city TEA may consist of an area comprising the
or town with a population of 20,000 or more in census tract(s) in which the new commercial
which the enterprise is principally doing busi- enterprise is principally doing business, includ-
ness has been designated a high unemploy- ing any and all adjacent tracts, if the weighted
ment area. average of the unemployment rate for all in-
cluded tracts is at least 150 percent of the na-
tional average.

Current technical issues: DHS will amend its regulations to include the fol- Conditions of Filing:
• The current regulation does not clearly define lowing technical changes: Benefits:
the process by which derivatives may file a • Clarify the filing process for derivatives who • Adds clarity and eliminates confusion for
Form I–829 petition when they are not included are filing a Form I–829 petition separately from the process of derivatives who file sepa-
on the principal’s petition. the immigrant investor. rately from the principal immigrant inves-
• Interviews for Form I–829 petitions are gen- • Provide flexibility in determining the interview tor.
erally scheduled at the location of the new location related to the Form I–829 petition. Costs:
commercial enterprise. • Amend the regulation by which the immigrant • Total cost to applicants filing separately
• The current regulations require an immigrant investor obtains the new permanent resident will be $91,023 annually.
investor and his or her derivatives to report to card after the approval of his or her Form I– Conditions of Interview:
a district office for processing of their perma- 829 petition because DHS captures biometric Benefits:
nent resident cards. data at the time the immigrant investor and • Interviews may be scheduled at the
derivatives appear at an ASC for USCIS office having jurisdiction over ei-
fingerprinting. ther the immigrant investor’s commercial
• Add 8 CFR 204.6(n) to allow certain investors enterprise, the immigrant investor’s resi-
to remain eligible for the EB–5 classification if dence, or the location where the Form I–
a project’s offering is amended or supple- 829 petition is being adjudicated, thus
mented based upon the final rule’s effective- making the interview program more effec-
ness. tive and reducing burdens on the immi-
grant investor.
• Some petitioners will benefit by traveling
shorter distances for interviews and thus
see a cost savings in travel costs and op-
portunity costs of time for travel and inter-
view time.
Costs:
Investors obtaining a permanent resident card:
Benefits:
• Cost and time savings for applicants for
biometrics data.
Costs:
Eligibility Following Changes to Offering:
Benefits:
• An amendment to a project’s offering
based on the final rule’s provisions might
not result in the denial or revocation of a
petition.
Costs:
Miscellaneous Changes
Current miscellaneous items: DHS will amend its regulations to make the following These provisions are technical changes and will have
• 8 CFR 204.6(j)(2)(iii) refers to the former U.S. miscellaneous changes: no impact on investors or the government.
Customs Service. • DHS is updating references at 8 CFR
• Public Law 107–273 eliminated the require- 204.6(j)(2)(iii) from U.S. Customs Service to
ment that alien entrepreneurs establish a new U.S. Customs and Border Protection.
commercial enterprise from both INA section • Removing references to requirements that
203(b)(5) and INA section 216A. alien entrepreneurs establish a new commer-
• 8 CFR 204.6(j)(5) introductory text and (j)(5)(iii) cial enterprise in 8 CFR 216.6.
reference ‘‘management’’; • Removing references to ‘‘management’’ at 8
• Current regulation at 8 CFR 204.6(j)(5) has the CFR 204.6(j)(5) introductory text and (j)(5)(iii);
phrase ‘‘as opposed to maintain a purely pas- • Removing the phrase ‘‘as opposed to maintain
sive role in regard to the investment’’; a purely passive role in regard to the invest-
• Public Law 107–273 allows limited partnerships ment’’ from 8 CFR 204.6(j)(5);
to serve as new commercial enterprises; • Clarifies that any type of entity can serve as a
• Current regulation references the former Asso- new commercial enterprise;
ciate Commissioner for Examinations. • Replacing the reference to the former Asso-
• 8 CFR 204.6(k) requires USCIS to specify in ciate Commission for Examinations with a ref-
its Form I–526 decision whether the new com- erence to the USCIS AAO.
mercial enterprise is principally doing business • Amending 8 CFR 204.6(k) to specify how
in a targeted employment area. USCIS will issue a decision.
• Sections 204.6 and 216.6 use the term ‘‘entre- • Revising sections 8 CFR 204.6 and 216.6 to
preneur’’ and ‘‘deportation.’’ These sections use the term ‘‘investor’’ instead of ‘‘entre-
also refer to Forms I–526 and I–829. preneur’’ and to use the term ‘‘removal’’ in-
• 8 CFR 204.6(i) and (j)(6)(ii)(B) use the phrase stead of ‘‘deportation.’’
‘‘geographic or political subdivision’’ in describ- • Removing references to ‘‘geographic or polit-
ing state designations of high unemployment ical subdivision’’ in 8 CFR 204.6(i) and
areas for TEA purposes. (j)(6)(ii)(B).
• The priority date of a petition for classification • Providing clarification in 8 CFR 204.6(d) that
as an investor is the date the petition is prop- the petitioner of multiple immigrant petitions
erly filed. approved for classification as an investor gen-
erally is entitled to the earliest qualifying pri-
ority date.
In addition to the above, applicants will need to read and review the rule to become familiar with the final rule provisions. Familiarization costs to read and review
the rule are estimated at $629,758 annually.
(2) Background and Purpose of the Final EB–5 filings grew rapidly starting in percent) blended program capital with
Rule 2008, when the U.S. financial crisis capital from other sources. For regional
The preceding sections of the reduced available U.S.-based center NCEs sourced with blended
preamble review key historical aspects commercial lending funds and capital, the EB–5 portion comprised 40
and goals of the program, and specific alternative funding sources, such as the percent of the total capital outlay, while
justifications for the particular EB–5 program, were sought. Based on for non-regional center NCEs sourced
provisions in the final rule. This section the type of projects that Form I–526 with blended capital, the EB–5 portion
supplements and provides additional petitions describe, it appears that EB–5 comprised 50 percent of the total capital
points of analysis that are pertinent to capital has been used as a source of outlay.
this regulatory impact assessment. financing for a variety of projects,
A person wishing to immigrate to the including a large number of commercial (3) Baseline Program Forecasts
United States under the EB–5 program real estate development projects to
develop hotels, assisted living facilities, DHS produced a baseline forecast of
must file an Immigrant Petition by Alien
and office buildings. the total number of Form I–526 receipts,
Investor (Form I–526). Each individual
immigrant investor files a Form I–526 In general, DHS databases do not track beginning in the first year the rule will
petition containing information about the total number of investment projects take effect and extending for 10 years for
their investment.117 The investment associated with each individual EB–5 the period FY 2017–2026.121 This Form
must be made into either an NCE within investment by petitioners, but rather I–526 forecast includes the historical
a designated regional center in track the NCE associated with each trend of Form I–526 receipts from FY
accordance with the Regional Center individual investment. Any given NCE 2005 to FY 2015, the filing projections
Program or a standalone NCE outside of could fund multiple projects. DHS from the USCIS Volume Projections
the Regional Center Program (‘‘non- analysis of filing data reveals that for FY Committee (VPC), and input from IPO.
regional center’’ investment). The NCE 2014–2016, on average per year, 1,461 The VPC projects that the high rate of
may create jobs directly (required for unique NCEs were referenced in the growth in EB–5 investment filings,
non-regional center investments), or Form I–526 petitions submitted. On which averaged 39 percent annually
pool immigrant investors’ funds into average 51 percent of the overall since FY 2008, will slow to about 3.3
associated NCEs that in turn undertake number of unique NCEs were found in percent over the next 3 years and will
job-creating activities directly or, more petitions associated with regional subsequently level off. The program
typically, indirectly through JCEs which centers, and 49 percent of the overall grew exponentially starting in 2008 with
receive EB–5 capital from the regional number of NCEs, were found in non-
the economic downturn. At that time,
center (RC)-associated NCEs. With regional center-associated petitions.
commercial lending was extremely
respect to regional center investors, This suggests that on average, unique
NCEs are more common in non-regional difficult to obtain. As the U.S. economy
once a regional center has been
center filings, as 92 percent of has improved, commercial lending is
designated, affiliated investors can
individual petitioner filings are now more viable, resulting in fewer
submit Form I–526 petitions in the
concurrent year and in future years, associated with regional centers.119 overall petitions. In addition, in the
provided the regional center maintains DHS obtained and analyzed a random past, USCIS has experienced significant
its designation. Each year, the stock of sample of Form I–526 petitions that spikes in filings in anticipation of the
approved regional centers represents the were submitted in FY 2016. The files in possibility that Congress would either
previous year’s approved total, plus new the sample were pending adjudicative allow the Regional Center Program to
regional centers approved during the review at IPO in May 2016.120 As the sunset or implement new legislative
current year, minus regional centers that results obtained from analysis of this reforms that would increase the
are terminated in the concurrent year.118 random sample are utilized in required minimum investment amounts,
DHS analysis of Form I–526 filing forthcoming sections of this regulatory as investors sought to ‘‘beat’’ the new
data for FY 2014–2016 indicates that on analysis, it henceforth will be referred to levels. These spikes have occurred
average, 13,103 Form I–526 petitions as the ‘‘2016 NCE sample’’ for brevity. around the program’s anticipated sunset
were filed annually. Investments in A key takeaway from the review of the (e.g., September 2015, December 2015,
regional centers accounted for an sample is that a majority of all NCEs (80 and September 2016). USCIS believes
average of 12,042 such petitions that the filing growth rate will level off
annually, or 92 percent of all submitted 119 IPO NCE data records indicate that the
once the program is extended for longer
Form I–526 petitions, while non- disparity in the regional center petitioner filings
compared to unique NCEs—92 percent of total than one year at a time. DHS used this
regional center investments accounted petitioner filings compared to 49 percent of unique information to inform a forecasting
for an average of 1,062 Form I–526 NCEs—exists because regional center projects model based on a logistic function that
petitions annually, or about 8 percent. include 18 investors on average, while non-regional
center investments include only 1.5 investors on captures the past increase in receipts
117 To be eligible at the time of the Form I–526 average. from a low baseline, the exponential
petition’s filing, investors must demonstrate either
120 The figures for yearly volumes of Form I–526
growth that the program experienced
that they have already invested their funds into the filings are publicly available under DHS
performance data: USCIS, Number of Form I–526
from FY 2008–2015, and a very small
NCE or that they are actively in the process of
investing. Some investors choose to demonstrate Immigrant Petitions by Alien Entrepreneurs by rate of growth anticipated for the next
commitment of funds by placing their capital Fiscal Year, Quarter, and Case Status 2008–2016, 3 years leading to a leveling off of future
contribution in an escrow account, to be released available at https://www.uscis.gov/sites/default/ growth. The technical details are
irrevocably to the NCE upon a certain trigger date files/USCIS/Resources/Reports%20and%20Studies/
or event, such as approval of the Form I–526 Immigration%20Forms%20Data/Employment- provided in the accompanying footnote,
petition. based/I526_performancedata_fy2017_qtr2.pdf. The and as can be seen in the graph, the DHS
118 Between May 2008 and July 2017, 128 regional NCE data were obtained from file tracking data estimation technique closely fits past
centers have been terminated. USCIS, Immigrant supplied by IPO. Because the NCE file submissions
Investor Regional Centers, available at http:// contain detailed business plan and investor 121 DHS did not attempt a similar forecast for
www.uscis.gov/working-united-states/permanent- information, the NCE data are not captured in
Form I–924 receipts, because DHS does not have a
workers/employment-based-immigration-fifth- formal DHS databases that are provided publicly,
preference-eb-5/immigrant-investor-regional- but rather in internal program office and sound basis for predicting how the rule will affect
centers. adjudication records. such receipts.
filings and captures the expected trends 2016, compared with the past receipts Additionally, changes in receipts driven
alluded to earlier.122 for the same period estimated by our by this rule could cause variations in
Figure 1 graphs the volume of ‘‘past’’ forecasting function, plus the forecasts the future receipts that are not reflected
actual Form I–526 filings from 2005 to thereafter for future filings. in the present forecasts.
The forecast values are listed in Table relationship between the number of the termination of a regional center) as
3: NCEs and the number of Form I–526 they wait for their EB–5 visa priority
filings over time.123 The impact of these date to become current; and provide
TABLE 3—DHS FORECASTS FOR IN- provisions on the forecasts will be investors with greater flexibility to deal
VESTOR FORM I–526 RECEIPTS AND described in the relevant sections of this with changes to business conditions.
NCES analysis. For example, investors with an
approved petition involved with an
(4) Economic Impacts of the Major Rule
FY Investors NCEs underperforming or failing investment
Provisions
project will be able to move their
2017 ...................... 15,241 1,481 a. Retention of Priority Date investment funds to a new, more
2018 ...................... 15,685 1,524 promising investment project without
2019 ...................... 15,925 1,547 This rule will generally allow an EB–
5 immigrant petitioner to use the losing their place in the visa queue.
2020 ...................... 16,052 1,560
2021 ...................... 16,119 1,566 priority date of an approved EB–5 There will be an operational benefit to
2022 ...................... 16,153 1,570 petition for any subsequently filed EB– the investor cohort because priority date
2023 ...................... 16,171 1,571 5 petition for which the petitioner retention will make visa allocation more
2024 ...................... 16,181 1,572 qualifies. Provided that petitioners have predictable with less possibility for
2025 ...................... 16,185 1,573 not yet obtained lawful permanent massive fluctuations due to regional
2026 ...................... 16,188 1,573
residence pursuant to their approved center termination that could, in the
10-year total .. 159,900 15,538 petition and that such petition has not case of some large regional centers,
been revoked on certain grounds, negatively affect investors who are in
Annual Aver- petitioners will be able to retain their the line at a given time. This change
age ............. 15,990 1,554 priority date and therefore retain their will provide greater certainty and
place in the visa queue. DHS is allowing stability for investors in their pursuit of
The last column of Table 3 provides priority date retention to: Address permanent residence in the United
estimates of the total number of NCEs. situations in which petitioners may States, helping lessen the burden of
An assumption of the NCE forecasts is become ineligible through situations unforeseen by the investor
that there is no change in the circumstances beyond their control (e.g., related to their investment. In addition,
122 DHS utilized a logistic function of the format, focused on minimizing the sum of squared errors determined via input from EB–5 program
(C/(l + be¥ρt)) where input t is the time year code (such as least squares regression) or other fitting management.
(starting with zero), e is the base of the natural technique, and instead chose the parameters to 123 In other words, the assumption is that the
logarithm, and C, l, b, and r are parameters such reflect the past trend of actual receipts and the
current number of investors per NCE holds in the
that C/l asymptotically approaches the maximum expected leveling off in their growth rate. For the
level of the predicted variable, the Form I–526 final forecast run, the specific calibration was C = future. For the NCE projections, the 2016 value is
receipts. The parameters b and r jointly impact the 17,000, l = 1.05, b = 180, and r = .66. The set at the 2014–2016 average of 1,404. For each year
inflection and elongation of the sigmoidal curve. maximum expected level of receipts (equal to thereafter, the figure is based on the growth rate of
ER24JY19.012</GPH>
DHS did not attempt an estimation procedure 17,000/1.05 which is approximately 16,200) was predicted Form I–526 receipts.
by allowing priority date retention, information on investor income, wealth, source of the capital. As a result, a
investors obtain greater flexibility in or investment preferences. DHS change in the composition of capital
moving their investment funds out of therefore cannot estimate how many could change the overall profitability for
potentially risky projects, thereby past investors would have been unable one or more of the parties involved;
potentially reducing fraud and or unwilling to have invested at the new however, if the project on the whole
improving the potential for job creation amounts, and hence cannot make promises net profitability, taking into
in the United States. DHS cannot extrapolations to potential future account risk and potential returns from
quantify or monetize the net benefits of investors and projects. However, as other investments, it may proceed as
the priority date retention provision or noted earlier, it would take a substantial planned. The specific impact on each
assess how many past or future reduction in investors to actually reduce party for each project will vary on a
investors might be affected. total investment below current levels. If case-by-case basis, and will be
the 80 percent higher levels of required dependent on, among other things, the
b. Investment Amount Increase
investment do not lead to a reduction in particular financial structures and
DHS will raise the standard minimum the number of EB–5 investments, the agreements between the regional center,
investment amount from the current $1 absolute amount of investment would investors, NCE, and project developer. It
million to $1.8 million to account for increase by 80 percent. There is will also be determined by local and
the rate of inflation from the program’s currently about $4.43 billion in annual
inception in 1990 until the time of the regional investment supply and
TEA investment under the program. At
proposed rule. DHS will also raise the demand, lending conditions, and
the TEA investment amount of $900,000
reduced investment amount for TEA general business and economic factors.
in this final rule, this same level of total
projects to $900,000, which is 50 TEA investment would be achieved DHS also considers that an increase in
percent of the general investment with 44 percent fewer investors. the investment amount could make
amount.124 DHS will further adjust the Furthermore, small and even moderate other countries’ foreign investor visa
minimum investment amounts every 5 reductions in investors actually stand to programs more attractive and therefore
years. The standard level will be generate growth in total investment. It is there could be some substitution into
adjusted for inflation based on the 1990 entirely possible that total investment such programs. The decision to invest in
level and the reduced amount will be will actually increase, even if the another country’s program will depend
adjusted to maintain 50 percent of the number of investors were to decrease. in part on the investment and country-
standard minimum investment amount. In addition to the effect on investors, specific risk preferences of each
These increases are needed because the it is reasonable to assume that the investor. While DHS has no means of
investment amounts have never been changes to the investment amounts will ascertaining such preferences, it is
adjusted to keep pace with inflation, also affect regional centers. If the higher possible that some substitution into
thereby eroding the real value of the amounts reduce the number of investors non-U.S. investor visa programs could
investments. in the global pool, competition for fewer occur as a result of the higher required
DHS believes it is reasonable to investors may make it more costly for investment amounts. However,
assume that some prospective investors regional centers to identify and match according to DHS research, substitution
under the current rule may be unable or with investors. However, the net effect into another country’s immigrant
unwilling to invest at either of the on regional center costs is not investor program will likely be more
higher levels of investment under the something DHS can forecast with costly for investors than investing in the
new rule. However, DHS is unable to accuracy. EB–5 program even with increases in
estimate the potential reduction in DHS also believes that for both the EB–5 investment amounts. DHS has
investments either in terms of past regional center and non-regional center laid out some of the comparisons to
activity or forecasted activity, and investments, the projects and the
other countries’ immigrant investor
cannot therefore estimate any impacts businesses involved could be affected. A
concerning job creation, losses or other programs earlier in the preamble.
reduced number of EB–5 investors
downstream economic impacts driven could preclude some projects from There are numerous ancillary services
by the investment amount increases. going forward due to outright lack of and activities linked to both regional
DHS evaluates the source of investor requisite capital. Other projects will center and direct investments, such as,
funds for legitimacy but not for likely see an increase in the share of but not limited to, business consulting
non-EB–5 capital, such as capital and advising, finance, legal services,
124 The adjustment to the standard minimum
sourced to domestic or other foreign and immigration services. However,
investment amount is based on the CPI–U, which,
as compared to a base date of 1982–1984, was 130.7
sources. As alluded to in Section Two DHS is not certain how the rule will
in 1990 and 237.017 in 2015. The actual increase of this analysis, analysis of the 2016 affect these services. Similarly, DHS
in prices for the period was approximately 81.34 NCE sample reveals that 80 percent of does not have information on how the
percent, obtained as ((CPI–U2015/CPI–U1990)¥1)). NCEs blend EB–5 capital with other revenues collected from these types of
The $1.8 million investment amount is rounded.
See generally Bureau of Labor Statistics, Inflation &
sources of capital. DHS believes that the activities contribute to the overall
Prices, available at http://www.bls.gov/data/ costs of capital and return to capital revenue of the regional centers or direct
#prices. could be different depending on the investments.
In summary, DHS believes that the projects could be forgone while others index will be. The 1.5 percent estimate
increase in the minimum investment will proceed with a higher composition is based on the average rate of inflation
amount will bring the investment of non-EB–5 capital, with resultant for the period 2009–2017, which
amounts in line with real values. DHS changes in profitability and rates of economists generally consider to be
recognizes that some of the investment return to the parties involved. An relatively low compared to earlier
increase benefits could be offset if some overall decrease in investments and periods. The 3.2 percent estimate used
investors are deterred from investing at projects will potentially reduce some for the higher-end projection is based on
the higher amounts. DHS does not have job creation and result in other the 3.2 percent inflation rate in 2011,
the data or information necessary to downstream effects. which was the highest annual inflation
attempt to estimate such mitigating rate observed from the 2009 to 2017
c. Periodic Adjustments to the
effects. It is possible that the higher period. DHS believes it is appropriate to
Investment Amounts
investment amounts could deter some characterize the 3.2 percent rate as a
investors from EB–5 activity and In addition to initially raising the
‘‘moderate’’ inflation baseline, because
therefore negatively affect regional investment thresholds to account for
although it is higher than the average
center revenue in some cases, although inflation, DHS will adjust the standard
annual rate since 2009, it is not
the magnitudes and net effects of these investment threshold every 5 years (as
considered by economists to be high as
impacts cannot be estimated. It is also compared to $1,000,000 in January 1990
at the program’s inception) to account compared to other historical periods.125
possible that the higher investment
amounts could attract additional capital for future inflation, and to adjust the Table 4 lists the general minimum
overall and stimulate projects to get off reduced investment threshold for TEAs investment amounts and reduced
the ground that otherwise might not. to keep pace with the standard amount. investment amounts after 5 and 10 years
Due to the complexity of EB–5 financial DHS projected the effects of this if the amounts are raised initially as
arrangements and unpredictability of methodology using a relatively low, finalized in this rule. The figures are in
market conditions, DHS cannot forecast recent inflation index (1.5 percent) and millions of U.S. dollars and are rounded
with confidence how many projects a more moderate inflation index (3.2 to the nearest fifty-thousandth. DHS
would be affected by the increased percent). DHS made two separate notes that estimates are slightly different
investment amounts through a change projections based on two different than those provided in the proposed
in the number of individuals investing indexes because DHS cannot predict rule due to the modification to the
through the EB–5 program. Some with certainty what the future inflation inflation adjustment.
TABLE 4—PROJECTED INVESTMENT AMOUNTS AT 5-YEAR REVISIONS

[Figures are in millions of $]
Projected investment amount
Based on Based on
Revision
Provision: Initial increase average moderate
(year) inflation inflation
scenario, scenario,
1.5 percent 3.2 percent
Standard Investment Amount = $1.8 Million in 2018 .................................................................. 5 1.95 2.12

10 2.10 2.48
Minimum Investment Amount = $900,000 in 2018 ..................................................................... 5 .98 1.06
10 1.05 1.24
DHS attempted to assess the costs of predict the impact to the capital subdivision that constitutes the TEA,
these changes. As described earlier, the available for projects. although it is the responsibility of the
potential cost of the higher amounts petitioner to provide the supporting
d. Targeted Employment Areas
may result in a reduction in the number data and methodology involved in the
of investors and projects and a lower Under the current regulations, a state state TEA determination. DHS ensures
share of EB–5 capital for some projects, may designate an area in which the state designations comply with the
which could result in capital losses, enterprise is principally doing business statutory requirement that the proposed
fewer jobs created, and other reductions as a high unemployment TEA if that area designated by the state has an
in economic activity. Or, there could be area is a geographic or political unemployment rate of at least 150
an increase in overall EB–5 capital subdivision of a metropolitan statistical percent above the national average by
flowing into the economy, which could area (MSA) or of a city or town with a reviewing state determinations of the
result in more jobs created and increases population of 20,000 or more. As is the unemployment rate and assessing the
in economic activity. DHS is not able to current practice, state determinations method or methods by which the state
predict how many investors and for TEAs define the appropriate authority obtained the unemployment
projects will be affected, nor can we boundaries of a geographic or political statistics.126 Currently DHS does not
125 Allan Meltzer, ‘‘A Slow Recovery with Low 23, 2015), available at http:// research/files/wp2013-08.pdf. The inflation rates
Inflation,’’ Hoover Inst., Econ. Working Paper No. www.federalreserve.gov/econresdata/notes/feds- reflect the yearly seasonally adjusted average for the
13,110 (2013), available at http://www.hoover.org/ notes/2015/low-inflation-in-the-united-states-a- consumer price index for all urban consumers (CPI–
sites/default/files/13110_-_meltzer_-_a_slow_ summary-of-recent-research-20151123.html; Mary U) and are found at: https://www.bls.gov/cpi/tables/
recovery_with_low_inflation.pdf; see also Michael C. Daly and Bart Hobijn, Downward Nominal Wage
supplemental-files/historical-cpi-u-201808.pdf.
T. Kiley, Low Inflation in the United States: A Rigidities Bend the Phillips Curve, Fed. Reserve
126 USCIS Policy Manual, 6 USCIS–PM G,
Summary of Recent Research, FEDS Notes, Board Bank S.F., Working Paper No. 2013–08 (2014),
of Governors of the Federal Reserve System (Nov. available at http://www.frbsf.org/economic- Chapter 2.A(5).
limit the number of census tracts that a that 98 percent of regional center respectively. These too will be
state can aggregate as part of a high investments and 68 percent of non- unaffected by the specific TEA changes
unemployment TEA designation. TEA regional center investments are made proposed in this rule. Hence the first
configurations that DHS has evaluated into TEAs. Because the 2016 sample subgroup represents filings that would
from state designations have included significantly over-represents non- not be affected by the rule. The second
the census tract or tracts where the NCE regional center investments, DHS also subgroup is the remainder—those filings
is principally doing business (‘‘project determined the percentage of into high unemployment TEAs that
tract(s)’’), one or more directly adjacent investments overall that were applied to relied on three or more census tracts.
tracts, and others that are further TEAs. DHS found that 96 percent of This final rule will potentially affect
removed, resulting in configurations investments and 83 percent of NCEs some of the designations in this second
resembling a chain-shape or other were applied to TEAs.128 About 9 subgroup.
contorted shape. This final rule will percent of investments that were made Having broken out the filings to
remove states from the high into TEAs were made into rural TEAs. identify the segment that would
unemployment area designation The non-regional center share of rural potentially be affected, DHS proceeded
process; instead, investors will be TEA investments was slightly higher to estimate the shares of investments
required to provide sufficient evidence than that of regional centers, at 9 and 11 and NCEs potentially impacted, as well
to DHS in order to qualify for the percent, in order. as the actual numbers, on an annual
reduced investment threshold. Under DHS then parsed the TEA filings basis. There are two caveats to our
this final rule, DHS will generally limit comprising the 2016 NCE sample into analysis. Foremost, we emphasize that
the number of census tracts that could specific cohorts. Specifically, DHS is the figures presented represent potential
be combined for this purpose.127 interested in the number and share of and likely maximum impacts for the
Specifically, DHS will allow for a high projects and NCEs that would likely be following reason. Some of the group that
unemployment area to consist of an area affected by the rule. DHS thus split the relied on three or more tracts may have
comprised of the census tract(s) in sample of NCEs into regional center and been configured in a manner that could
which the new commercial enterprise is non-regional center groups, and then meet the new provision. The data that
principally doing business, including broke these into two subgroups each. DHS analyzed only contained the
any and all adjacent tracts, if the The first subgroup is the number of number of tracts, not the raw data to
weighted average of the unemployment filings that comprised rural, and then evaluate the actual geographical
rate for all included tracts is at least 150 high unemployment TEA filings that configuration and to determine if it
percent of the national average. did not rely on state designations to would meet the provision in the final
Additionally, DHS will allow cities and qualify. The TEAs in this cohort did not rule. Second, the figures for investments
towns with a population of 20,000 or require state designations because the and NCEs apply to petitions filed and
more outside of MSAs to qualify as a project was located in a specific thus not to actual approvals or
TEA based on high unemployment. See geographical unit that met the investments actually made. The
final 8 CFR 204.6(j)(6)(ii)(A). unemployment threshold.129 These weighted percentages and figures
In order to assess the impacts of the TEAs would be unaffected by the applicable are summarized in the Table
changes to the TEA designation changes being finalized in this rule as 5 below, noting that the amounts are
requirements, DHS performed further they pertain to TEA reform. This first based on the average of filings for FY
analysis on the 2016 NCE sample. First, subgroup also adds the filings that 2014–2016; potential changes in future
DHS determined, based on the sample, relied on one or two census tracts, filing patterns are discussed later.
TABLE 5—TEA METRICS

Investments NCEs
TEA cohort Share Share
Amount Amount
(percent) (percent)
Not affected by the rule ................................................................................... 6,207 46 832 57

Potentially affected by the rule ........................................................................ 7,075 54 628 43
127 According to USCIS policy in effect at the time • The new commercial enterprise’s day-to-day slight, at 1 percent. The weighted average for TEA
of issuance of this rulemaking: operation; and investments is the sum of the regional center share
A new commercial enterprise is principally doing • The new commercial enterprise’s assets used in of investments (.92) multiplied by the TEA share
business in the location where it regularly, the creation of jobs. found in the sample (.98), and the non-regional
systematically, and continuously provides goods or USCIS Policy Manual, 6 USCIS–PM G (Nov. 30, share of investments (.08) multiplied by the TEA
services that support job creation. If the new 2016). share in the sample (.68). The resulting weighting
128 To account for the over-representation on non-
commercial enterprise provides such goods or equation is .90 + .06 = .96 or 96 percent. The
services in more than one location, it will be regional center investments, DHS uses a weighted weighted average for TEA NCEs is the sum of the
principally doing business in the location most average approach to increase precision in the regional center share of NCEs (.51) multiplied by
significantly related to the job creation. estimates. In the 2016 NCE sample non-regional the TEA share found in the sample (.98), and the
center NCE investments constitute exactly half, but
Factors considered in determining where a new non-regional share of NCEs (.49) multiplied by the
more broadly they account for less than a tenth (8
commercial enterprise is principally doing business TEA share in the sample (.68). The resulting
percent) of submitted investments. This bias is not
include, but are not limited to, the location of: a feature of the sampling methodology but rather an weighting equation is .50 + .33 = .83.
• Any jobs directly created by the new inherent feature of the population, because non- 129 For the TEA geographies that met the high
commercial enterprise; regional center investments comprise almost half, unemployment threshold in the sample analyzed,
• Any expenditure of capital related to the 49 percent, of all NCEs. Note that there is a slight 90 percent utilized MSAs and the remaining 10
creation of jobs; sampling discrepancy in NCEs as well but it is very percent utilized counties.
As the table reveals, just over half (54 the only case in which a state limits the creation and have other downstream
percent) of investments, or about 7,075 number of census tracts to a specific effects.
annually, could potentially be affected, number. Analysis of the NCE sample In addition to the amendments
though we stress again that this is an revealed that for tract configurations examined in the preceding analysis,
upper bound estimate. In reality, some with two or more tracts, the average DHS will allow cities and towns with a
portion of the maximum cohort for number of tracts aggregated was 16, but population of 20,000 or more outside of
projects and NCEs will have continued the median was 7. The figures are MSAs as a specific and separate area
to qualify for TEA designation under the slightly higher at 17 and 8, respectively, that may qualify as a TEA based on high
changes by this rule. However, currently when the cohort is isolated to three or unemployment. This is a narrower
DHS does not have reliable, statistically more multiple tract configurations. The change than was introduced in the
valid information from which DHS can difference in the mean and median NPRM, where it was proposed to allow
more accurately estimate the share and indicates that the distribution is right- any city or town with a population of
number of projects and NCEs likely to skewed, characterized by a small 20,000 to qualify as a TEA based on
be affected by the rule. Slightly under number of very large-tract number high unemployment. DHS cannot
half, 43 percent, of NCEs could be compilations, evidenced by a sample estimate the additional number of NCEs
impacted. range of 198 tracts. DHS notes that there that will qualify as principally doing
DHS obtained Census Bureau data on is sufficient variation in the data to business in and creating jobs in a TEA
adjacent tracts that were utilized in preclude state locational bias, as 21 based on this amendment. However,
studies unrelated to the current states and the District of Columbia were DHS anticipates the change will provide
rulemaking provision.130 From the represented in the 2016 NCE sample. benefits in that additional areas may
population of 74,001 tracts provided in Ultimately, DHS did not choose this qualify as a TEA based on high
the Census dataset, DHS randomly alternative option because it is not unemployment, potentially offering
sampled 390 tracts, which is slightly necessarily appropriate for nationwide investors more opportunities to invest
more than the 383 needed for 95 percent application, as the limitation to 12 in a TEA at the reduced investment
confidence and a 5 percent margin of census tracts may be justifiable for amount, and encouraging job creation in
error. The average number of adjacent reasons specific to California but may more areas of high unemployment.
tracts was 6.4 and the median was 6, not be apt on a national scale. e. Other Provisions
with a maximum of 11, a minimum of DHS stresses that the maximum
3, and a range of 8. Since ‘‘partial’’ tracts DHS has also analyzed the other
cohorts presented in Table 5 overstate provisions in the rule:
are not viable under the EB–5 program,
the number and shares of future Removal of Conditions Filing. DHS is
the average was rounded to the nearest
investments and NCEs that will be revising its regulations to clarify that,
whole number and 1 tract was added to
affected by the TEA reform provision except in limited circumstances,
account for the primary tract for which
because some of the configurations that derivative family members must file
the adjacencies were counted, to yield
relied on multiple tracts (3 or more) may their own petitions to remove
an average of 7 total tracts. This suggests
be able to meet the requirements of the conditions from their permanent
that it may not be unusual for a TEA
rule. Furthermore, the number of residence when they are not included in
designation of three or more tracts to
affected investments and NCEs is also a petition to remove conditions filed by
satisfy the adjacency requirements of
likely to be lower because regional the principal investor. Generally, an
this final rule.
The benefit of this aspect of the final centers may be able to replace forgone immigrant investor’s derivatives are
rule is that it will prevent certain TEA projects in places that will not meet the included in the principal immigrant
configurations that rely on a large high unemployment criteria under the investor’s Form I–829 petition.
number of census tracts indirectly final rule with other projects that will in However, there have been cases where
linked to the actual project tract(s) by fact qualify. For example, a regional the derivatives are not included in the
multiple degrees of separation. As a center seeking to locate a project on one principal’s petition but instead file one
result, some investments may be re- city block that will no longer qualify as or more separate Form I–829 petitions.
directed to areas where unemployment a TEA may opt to locate the project on This final rule clarifies that, except in
rates are truly high, according to the 150 another block that could qualify as a the case of a deceased principal,
percent threshold, and therefore may TEA under the new rule. In that sense, derivatives not included in the
stimulate job creation where it is most the final rule may provide additional principal’s Form I–829 petition cannot
needed. incentive for investments in rural areas, use one petition for all the derivatives
DHS also considered an alternative because such investments will be combined, but must each separately file
provision, under which TEA unaffected by this rule, or in areas that his or her own Form I–829 petition.
designations would be subject to a are more closely associated with high Based on IPO review of historical filings
twelve-tract limit. This limit is used by unemployment. DHS believes that some for this group, on average over a 3-year
the State of California in its TEA regional centers will not be able to make period about 24 cases per year involved
certifications. DHS considered this limit such a substitution and that there may such circumstances. Biometrics are
as an alternative approach because it is be costs in the forms of forgone currently required for the joint Form I–
investments and projects, and 829 petition submissions, so the
130 As of 2016, the Census Bureau records show accompanying reductions in job provision requiring separate filings will
73,057 Tracts in the United States, including the creation and other economic activity not impose any additional biometric,
District of Columbia but not counting U.S. (unless other investments and projects travel, or associated opportunity costs.
Territories. U.S. Census Bureau, 2010 Census create compensatory or more than
Tallies of Census Tracts, Block Groups and Blocks,
The only costs expected from this
available at https://www.Census.gov/geo/maps- compensatory economic activity). specific provision in the final rule will
data/data/tallies/tractblock.html. The data utilized DHS has described some of the be the separate filing fee and associated
in this analysis is currently available publicly from possible negative consequences of a opportunity cost. DHS has attempted to
Brown University’s (Providence, RI) American
Communities Project website at http://
reduced number of investors. A quantify these new costs as follows. The
www.s4.brown.edu/us2010/Researcher/ decrease in investments and projects filing fee for a Form I–829 petition is
Pooling.htm. may potentially reduce some job $3,750. DHS estimates that the form
takes 4 hours to complete. DHS distance from the new commercial require them to report to a district office
recognizes that many dependent enterprise. Therefore, DHS clarifies that for processing of their permanent
spouses and children do not currently USCIS has authority to schedule an resident cards. DHS also benefits by
participate in the U.S. labor market, and interview at the USCIS office holding removing a process that is no longer
as a result, are not represented in jurisdiction over either the immigrant necessary.
national average wage calculations. In investor’s commercial enterprise, the Petitioner Eligibility Following a
order to provide a reasonable proxy of immigrant investor’s residence, or the Change in a Project’s Offering. DHS also
time valuation, DHS has to assume some location in which the Form I–829 modifies its regulations to indicate that
value of time above zero and therefore petition is being adjudicated. DHS amendments or supplements made to an
uses an hourly cost burdened minimum cannot currently determine how many EB–5 project’s offering in order to
wage rate of $10.66 to estimate the petitioners will potentially be affected maintain compliance with securities
opportunity cost of time for dependent by these changes. From fiscal years 2012 laws based upon the final rule’s changes
spouses. The value of $10.66 per hour to 2016, DHS received an average of to 8 CFR 204.6 shall not independently
represents the Federal minimum wage 2,137 Form I–829 petitions. While not result in denial or revocation of an
with an upward adjustment multiple of all of these petitioners will require an investor’s petition. DHS does not
1.47 for benefits.131 Each applicant will interview or face hardship to travel for estimate any additional costs for this
face a time cost burden of $42.64, which an interview, some of this maximum provision. This allowance will likely
when added to the filing fee, is population may be affected.133 Some benefit certain investors whose
$3,792.64. Extrapolating the past petitioners will benefit by traveling eligibility for the EB–5 classification
number of average annual filings of 24 shorter distances for interviews and may have been at risk, absent this
going forward, total applicant costs will thus see a cost savings in travel costs provision, because of an amendment to
total $91,023.36 annually.132 and opportunity costs of time for travel offering documents based on the
Removal of Conditions Interview. In and interview time. changes made in this final rule. The
addition to the separate filing Process for Issuing Permanent petitions for this narrowly defined
requirement discussed earlier, DHS is Resident Cards. DHS also amends population of investors will not be
improving the adjudication process regulations governing the process by denied or revoked under the
relevant to the investor’s Form I–829 which immigrant investors obtain their circumstances put forth at new 8 CFR
interview process by providing new permanent resident cards after the 204.6(n), provided the investors were
flexibility in interview scheduling and approval of their Form I–829 petitions. eligible at the time of filing their
location. Section 216A(c)(1)(B) of the Current regulations require the petitions and remain eligible at the time
INA, 8 U.S.C. 1186b(c)(1)(B), generally immigrant investor and his or her of adjudication.
derivatives to report to a district office Miscellaneous Other Changes. DHS is
requires Form I–829 petitioners to be
for processing of their permanent also making a number of other technical
interviewed prior to final adjudication
resident cards after approval of the changes to the EB–5 regulations. First,
of the petition, although DHS may
Form I–829 petition. This process is no DHS is updating a reference to the
waive the interview requirement at its
longer necessary in light of intervening former United States Customs Service,
discretion. See INA section 216A(d)(3),
improvements in DHS’s biometric data so that it will now refer to U.S. Customs
8 U.S.C. 1186b(d)(3). Under this rule,
collection program.134 DHS now and Border Protection. Second, DHS is
DHS is giving USCIS greater flexibility
captures the required biometric data conforming DHS regulations to Public
to require Form I–829 interviews and
while the Form I–829 petition is Law 107–273, which eliminated the
determine the appropriate location for
pending, at the time the immigrant requirement that immigrant
such an interview. Additionally, current entrepreneurs establish a new
DHS regulations allow for Form I–829 investor and his or her derivatives
appear at an Application Support Center commercial enterprise from both section
petitioners to be interviewed prior to 203(b)(5) and section 216A of the INA.
final adjudication of a Form I–829 for fingerprinting, as required for the
Form I–829 background and security Accordingly, DHS removes references to
petition, but require the interview to be this requirement in 8 CFR 216.6. Third,
conducted at the USCIS District Office checks. DHS then mails the permanent
resident card directly to the immigrant DHS is further conforming DHS
holding jurisdiction over the immigrant regulations to Public Law 107–273 by
investor’s new commercial enterprise. investor by U.S. Postal Service
removing the references to
However, there is no requirement that registered mail after the Form I–829
‘‘management’’ at 8 CFR 204.6(j)(5)
the immigrant investor reside in the petition is approved. Accordingly, there
introductory text and (j)(5)(iii). Fourth,
same location as the new commercial is generally no need for the immigrant
DHS is removing the phrase ‘‘as
enterprise, and DHS has determined investor and his or her derivatives to
opposed to maintaining a purely passive
through some preliminary surveys appear at a district office after approval
role in regard to the investment’’ from
conducted by IPO that many immigrant of the Form I–829 petition.
DHS does not estimate any additional 8 CFR 204.6(j)(5). Fifth, DHS is allowing
investors are located a considerable any type of entity to serve as a new
costs for this provision. This provision
commercial enterprise. Sixth, DHS is
131 Minimum Wage, U.S. DOL, available at http:// will likely benefit immigrant investors
amending 8 CFR 204.6(k) to remove the
www.dol.gov/dol/topic/wages/minimumwage.htm and any derivatives, including by
(indicating the Federal Minimum Wage is $7.25 per requirement on USCIS to specify in the
providing savings in cost, travel, and
hour). The benefits-to-wage multiplier is calculated decision on the EB–5 petition whether
as follows: (Total Employee Compensation per time, since this regulation will no longer
the new commercial enterprise is
hour)/(Wages and Salaries per hour). See Economic
News Release, U.S. Department of Labor, Bureau of 133 USCIS, Number of I–829 Petitions by
principally doing business in a TEA.
Labor Statistics, Table 1. Employer costs per hour Entrepreneurs to Remove Conditions by Fiscal Year, Finally, DHS is making revisions to
worked for employee compensation and costs as a Quarter, and Case Status 2008–2016, available at otherwise unaffected sections of section
percent of total compensation: Civilian workers, by https://www.uscis.gov/sites/default/files/USCIS/ 204.6 and 216.6 to replace the term
major occupational and industry group (June 2018), Resources/Reports%20and%20Studies/Immigration
available at https://www.bls.gov/news.release/ %20Forms%20Data/Employment-based/I829_
‘‘entrepreneur’’ with the term
archives/ecec_06082018.pdf. performancedata_fy2017_qtr2.pdf. ‘‘investor.’’
132 Calculation: The burdened wage of $10.66 per 134 DHS already has authority to collect this Since the NPRM, DHS is making six
hour multiplied by 4 hours. information under 8 CFR part 103. additional miscellaneous changes to (1)
remove references to ‘‘geographic or $100.28. The total cost of familiarization of the entities involved may be
political subdivision’’ in 8 CFR 204.6(i) is $629,758.4 annually based on the considered small entities.
and (j)(6)(ii)(B), (2) provide clarification current number of approved regional In the IRFA of the NPRM, DHS
in 8 CFR 204.6(d) that the petitioner of centers and non-regional center NCEs in explained that there were four main
multiple immigrant petitions approved the recent past.136 types of business entities involved in
for classification as an investor is EB–5 that could be affected by the
B. Small Business Regulatory proposed rule changes: Immigrant
entitled to the earliest qualifying Enforcement Fairness Act of 1996
priority date, (3) changing ‘‘approved Investors, Regional Centers (RCs), New
EB–5 immigrant petition’’ to ‘‘immigrant This rule is not a major rule as Commercial Enterprises (NCEs), and
petition approved for classification as defined by section 804 of the Small Job-Creating Entities (JCEs). DHS
an investor, including immigrant Business Regulatory Enforcement explained that the investors who invest
petitions whose approval was revoked Fairness Act of 1996. This rule will not funds and file Form I–526 petitions are
on grounds other than those set forth result in an annual effect on the individuals who voluntarily apply for
below,’’ and ‘‘approved petition’’ to economy of $100 million or more, a immigration benefits on their own
‘‘immigrant petition approved for major increase in costs or prices, or behalf and thus do not meet the
classification as an investor,’’ (4) significant adverse effects on definition of a small entity. Therefore,
changing ‘‘based upon that approved competition, employment, investment, the EB–5 investors were not considered
petition’’ to ‘‘using the priority date of productivity, innovation, or on the further for purposes of the RFA.
the earlier-approved petition’’ in final 8 ability of United States companies to DHS also explained in the IRFA that
CFR 204.6(d), (5) clarifying that a TEA compete with foreign-based companies the complex, multi-layered structure of
may include census tracts directly in domestic and export markets. most EB–5 investments, coupled with a
adjacent to the census tract(s) in which However, as some small businesses may lack of data concerning revenue and
the NCE is primarily engaged in be affected under this regulation, DHS employment, made it impossible for
business, and (6) making a technical has prepared a Final Regulatory DHS to determine if NCEs and JCEs
correction to the inflation adjustment Flexibility Analysis under the were small entities. These constraints
formula for the standard minimum Regulatory Flexibility Act. still apply and DHS cannot determine if
investment amount and the high these entities are small in terms of the
C. Regulatory Flexibility Act
employment area investment amount, RFA. DHS sought public feedback on
The Regulatory Flexibility Act of 1980 the topic but did not receive data or
such that future inflation adjustments (RFA), 5 U.S.C. 601–612, as amended by
will be based on the initial investment information that could facilitate an
the Small Business Regulatory appropriate small entity analysis for this
amount set by Congress in 1990, rather Enforcement Fairness Act of 1996,
than on the most recent inflation final rule.
Public Law 104–121, 5 U.S.C. 601–612, In the IRFA, DHS explained that RCs
adjustment. All of these provisions are requires Federal agencies to consider were difficult to analyze because of the
technical changes and will have no the potential impact of regulations on lack of official data concerning
impact on investors or the government. small entities during the development of employment, income, and industry
Therefore, the benefits and costs for their rules. The term ‘‘small entities’’ classification of the regional center
these changes were not estimated. comprises small businesses, not-for- itself. First, DHS explained that the
Miscellaneous Costs. Familiarization profit organizations that are not bundled investments that RCs typically
costs: DHS assumes that there will be dominant in their fields, and pool and structure as loans do not
familiarization costs associated with governmental jurisdictions with constitute revenue. Second, RCs
this rule. To estimate these costs, DHS populations of less than 50,000. An typically report the North American
relied on several assumptions. First, ‘‘individual’’ is not defined by the RFA Industry Classification (NAICS) codes
DHS believes that each approved as a small entity, and costs to an associated with the sectors they plan to
regional center will need to review the individual from a rule are not direct investor funds toward, but these
rule. Other than regional centers, the considered for RFA purposes. In codes do not generally apply to the RCs
NCEs will also need to be familiar with addition, the courts have held that the business themselves. In addition,
the final rule. Based on the 851 regional RFA requires an agency to perform a information provided to DHS
centers as having approved Forms I–924 regulatory flexibility analysis of small concerning RCs generally does not
and 719 non-regional center NCEs when entity impacts only when a rule directly explicitly include revenues or
this analysis was conducted (July 3, regulates small entities.137 employment.138 As a result, DHS was
2017), a total of at least 1,570 identified Consequently, any indirect impacts unable to make a determination
entities will likely need to review the from a rule to a small entity are not concerning the small entity status of
rule. DHS believes that lawyers will costs for RFA purposes. RCs in the IRFA.
likely review the rule and that it will However, the changes proposed by Since the IRFA, DHS was able,
take about 4 hours to review and inform DHS to modernize and improve the EB– despite data constraints, to obtain some
any additional parties of the changes in 5 program may have the potential to information under some specific
this final rule. Based on the BLS affect several types of business entities assumptions to develop a methodology
‘‘Occupational Employment Statistics involved in EB–5 projects. Therefore, to analyze the small entity status of RCs,
(OES)’’ dataset, the current mean hourly DHS prepared an Initial Regulatory as will be explained in detail under
wage for a lawyer was $68.22.135 DHS Flexibility Analysis (IRFA) under the section D. Therefore, DHS presents this
burdens this rate by a multiple of 1.47
RFA in the proposed rule because some Final Regulatory Flexibility Analysis
to account for other compensation and (FRFA), which includes this additional
benefits, to arrive at an hourly cost of 136 Calculation: 1,570 entities × 4 hours each ×
burdened hourly wage of $100.28. 138 DHS conducted a small entity analysis on EB–
135 Thewage figure reflects the May 2017 update 137 A Guide for Government Agencies How to 5 regional centers for the 2016 comprehensive fee
from Bureau of Labor Statistics, Occupational Comply with the Regulatory Flexibility Act, May rule, which went into effect on December 23, 2016.
Employment Statistics (OES) data set, provided in 2012 page 22. See Direct versus indirect impact See 81 FR 73292. However, the same data
HTML format available at https://www.bls.gov/oes/ discussion, available at https://www.sba.gov/sites/ constraints as described in the NPRM of this rule
2017/may/oes_nat.htm#23-0000. default/files/advocacy/rfaguide_0512_0.pdf. made it impossible to draw any conclusions.
analysis. In summary, DHS was able to suggested that DHS should review such As described in the proposed rule and
determine that a significant number of data, and that if most regional centers similar to challenges with identifying
RCs may be small entities. However, are small businesses, additional analysis RCs as small entities, DHS had
DHS was still not able to conclusively is needed to assess potential changes to challenges in trying to identify NCEs
determine the impact of this final rule the course of the regulatory process. and JCEs as small entities. The
on those small entities. DHS appreciates the commenter’s multiplicity of ways in which an NCE
suggestion on using the size standard can engage in the job creating activity
Final Regulatory Flexibility Analysis revenue found in NAICS subsector 523 make it difficult to assign a NAICS code
Small entities that may incur to determine the small entity status of to any particular entity that constitutes
additional indirect costs by this rule are RCs. However, DHS disagrees that or comprises part of what is considered
the RCs that pool immigrant investors’ subsector 523, and its corresponding the NCE. Additionally, DHS does not
funds into associated NCEs that in turn size standard revenue, is the only require RC applicants or petitioners to
undertake job-creating activities directly appropriate industry in which to submit on their applications or petitions
or, more typically, indirectly through classify RCs. Subsector 523 primarily the type of revenue and employment
JCEs that receive EB–5 capital from the engages in underwriting, brokering, or data appropriate for analysis, regardless
RC-associated NCEs (most often through providing other services related to of the type of NCE or how it is
loans). RC activity has grown securities, commodity contracts, and structured. Also, due to data capture
substantially since 2008, and as of July other financial investments and related limitations, it is not feasible for DHS to
3, 2017, there were 851 approved RCs. activities.139 However, other NAICS reliably estimate the number of JCEs at
RC-affiliated Form I–526 petitions categories might also apply to certain this time. DHS anticipates forthcoming
accounted for 13,103, or 92 percent, of RCs. For instance, DHS determined that form revisions that may collect
Form I–526 petitions submitted some RCs could be classified under additional data on JCEs that receive EB–
annually from 2014–2016. Since RCs, NAICS code 522310, Mortgage and 5 capital, and expects to be able to
NCEs, and JCEs all have a role to play Nonmortgage Loan Brokers, given the examine this more closely in the future.
in the EB–5 program, the regulatory prevalence of the NCE to JCE loan
model and the role that RCs typically 3. Sources of Revenue for RCs and NCEs
changes promulgated in this final rule
notice could affect all three types of occupy in facilitating such loans. NAICS A commenter stated that although
entities. However, as was discussed in industry 522310 is comprised of revenue and employee numbers for RCs
the IRFA of the NPRM, DHS does not establishments primarily engaged in and NCEs are not collected on the Form
have a way of knowing if NCEs and JCEs arranging loans by bringing borrowers I–924A for Annual Certification, the
are small entities. and lenders together on a commission or revenue and employee numbers are
1. A Statement of the Need for, and fee basis.140 The small business size contained in supplementary papers filed
Objectives of, the Rule. standard for NAICS industry 522310 is annually with the Form I–924A.
DHS is updating its EB–5 regulations based on a revenue level of $7.5 million DHS reiterates that the information
to modernize aspects of the EB–5 or less. Regardless of which NAICS code provided by RC applicants as part of the
program and improve areas of the applies to some RCs, however, DHS Form I–924 and I–924A processes does
program in need of reform. The rule will reiterates that the revenue of RCs is still not include adequate data to allow DHS
also reflect statutory changes and codify difficult to determine because of the to reliably identify the small entity
existing policies. Elsewhere in this lack of official data concerning income status of individual RCs or businesses
preamble, DHS provides further and employment of the RC. Therefore, entities, such as NCEs and JCEs, under
background and explanation for changes even if a NAICS code allows for their purview. Information provided to
being made in this final rule. industry classification of the RC itself, DHS concerning RCs generally does not
2. A Statement of the Significant application of the size standard is more include RC revenues or employment of
Issues Raised by the Public Comments challenging. The information provided the RCs themselves.
in Response to the Initial Regulatory by RC applicants as part of the Form I–
4. Other Comments on the RFA
Flexibility Analysis, A Statement of the 924 and I–924A processes does not
Assessment of the Agency of Such include RC revenues or employment, There were several other comments
Issues, and A Statement of Any Changes which would be necessary to compare concerning the RFA. One commenter
Made in the Proposed Rule as a Result against the SBA size standard. claimed that individual investors
of Such Comments. should be considered small entities for
2. Industry Classifications/NAICS Codes purposes of this RFA. A second claimed
DHS received several comments on
To Classify NCEs that although DHS has acknowledged its
the IRFA analysis provided with the
proposed rule. These comments are One commenter stated that if most responsibilities under the RFA, it is
summarized and addressed as follows: NCEs and JCEs consider projects within actually not compliant with the RFA
a few industries, it would not be because of the lack of detailed analysis.
1. Industry Classifications/NAICS Codes burdensome for DHS to review IPO A third claimed that the rule would
To Classify Regional Centers annual reports to make the most cause significant impacts on many small
A commenter that represents multiple economically sound conclusions as to businesses, but that DHS did not
regional centers stated that according to the NAICS codes for most EB–5 program seriously consider any alternative
its members, RCs typically are classified NCEs and JCEs. proposals. These commenters suggest
under NAICS code 523, Securities, that the rule should not be implemented
Commodity Contracts, and Other 139 2017 NAICS Definition of Subsector 523
until a more detailed analysis of small

Financial Investments and Related Securities, Commodity Contracts, and Other
Financial Investments and Related Activities,
entity impacts can be undertaken and
Activities. According to the commenter, available at https://www.census.gov/cgi-bin/sssd/ evaluated.
subsector 523 is identified in the Small naics/naicsrch?code=523&search=2017 NAICS DHS appreciates the commenters’
Business Administration’s (SBA) size Search. concerns but disagrees with the premise
140 2017 NAICS Definition of 522310, Mortgage
standard list as a small entity based on and Nonmortgage Loan Brokers, available at https://
that DHS did not comply with the RFA.
a revenue level of $38.5 million or less. www.census.gov/cgi-bin/sssd/naics/naicsrch?code= DHS has fully complied with the
See 13 CFR 121.201. The commenter 522310&search=2017 NAICS Search. requirements of the RFA, which are
procedural in nature. Sections 603 and of affected business entities could be under the purview of RCs can only be
604 of the RFA describe what small entities, as described below. determined after the Form I–924 is
information needs to be included in an 3. The Response of the Agency to Any approved. Thus, DHS cannot rely on
IRFA and FRFA. DHS has provided that Comments Filed by the Chief Counsel these early projections in determining
information. DHS notes the RFA for Advocacy of the Small Business RC revenue. But DHS can multiply the
provides analytical flexibilities to Administration in Response to the administrative fees by the number of
agencies and does not contain a Proposed Rule, and a Detailed associated EB–5 investors. Therefore, in
requirement for a detailed analysis; for Statement of Any Change Made to the an effort to reach a more accurate count
instance, section 607 of the RFA states Proposed Rule in the Final Rule as a of RC revenue, DHS manually matched
a quantitative analysis is not required to Result of the Comments. each RC EDD to the corresponding
comply with the RFA’s analytical No comments were filed by the Chief investors from the Form I–526.
requirements.141 Counsel of Advocacy of the SBA.
4. A Description of and an Estimate of Through the process described in the
DHS explained in the proposed rule
the Number of Small Entities to Which preceding paragraph, DHS obtained the
and in this final rule the reasons why
the Rule Will Apply or an Explanation number of investors per RC and
this data is difficult to obtain and assess.
of Why No Such Estimate Is Available. proceeded to refine the RC cohort by
Since the proposed rule, however, DHS
As mentioned above, DHS was able to removing RCs that did not have relevant
has attempted to seek some additional
obtain some additional information on data, RCs that have been terminated,
data on RCs and has included that
RCs since the publication of the NPRM. and those RCs that had no affiliated
analysis in this final regulatory
RCs file Form I–924 with DHS that Form I–526 petitions associated with
flexibility analysis. This additional
includes a plan of operations for the RC them (as those would present no
analysis provides an estimated
and information regarding fees and information that could be used in the
percentage of RCs that may be
considered small entities. As DHS has surcharges paid to the RC. Additionally, analysis). For those RCs included in the
described in this analysis and in the individuals investing through the RC analysis, DHS notes that the numbers of
published NPRM, DHS was not able to program file Form I–526 with DHS Forms I–526 filed under a specific RC
obtain additional data on JCEs. based on a specific NCE, which are (and related administrative fee
Additionally, aside from the suggestion affiliated with a specific RC. For this payments) are not spread evenly across
to review investor and RC filings analysis, DHS manually consulted years, as some years have more Form I–
(which, as described above, DHS has internal file tracking datasets on Form I– 526 submissions than others. This posed
done), commenters did not provide any 526 and NCE submissions for RC substantial challenges for DHS analysis,
data sources that would allow small investors. NCEs can have multiple because there is no natural cutoff (such
entity analysis for JCEs. investors, but each individual investor as a fiscal year or calendar year) for
DHS disagrees with the commenter must file a unique Form I–526. DHS analyzing the data and it does not allow
that investors must be considered under searched for filed Forms I–526 and DHS to capture the number of unique
the RFA. An investor who wishes to grouped them according to NCE. Then, investors to each RC. If DHS were to
immigrate to the United States through DHS connected the identified NCEs to extend the analytical cohort back to
the EB–5 program must file an the unique regional center. Through this earlier approvals in order to capture the
Immigrant Petition by Alien Investor process, DHS obtained the number of total number of investors unique to the
(Form I–526). Individuals who file Form investors and year of each investment RC, the timeframe for analysis would
for each of the approved RCs. span multiple years.143 Therefore, this
I–526 petitions apply for immigration
When reviewing Forms I–924 makes DHS’ ability to accurately assess
benefits on their own behalf and thus do
submitted by RCs to DHS, adjudicators RC revenue against the SBA standards
not meet the definition of a small entity.
and economists prepare economic due difficult.144
Therefore, DHS reiterates that investors
diligence reports (EDD) as part of the
need not be considered further for To address the timing issue, DHS
adjudication process. These EDDs are
purposes of regulatory flexibility analyzed the time-distribution of the
not captured in formal DHS databases.
analysis. filing of Form I–526 petitions associated
However, for this analysis, DHS
Finally, although the commenters with designated RCs and found that the
manually obtained EDDs for 574
claimed that there would likely be clear bulk of filings—exactly four-
regional centers with approved Forms I–
significant costs to small entities, they fifths—were made in the first year and
924 in FY 2017. The EDDs contain data
did not provide credible data or analysis the second year after a RC was
from the Form I–924 submission, such
to support the claim. As it pertains to designated, while only 7 percent of
as the administrative fee that the RC
compliance with regulatory flexibility filings were made in the same year the
may charge to investors as well as plans
analysis requirements, DHS complied RC was designated. Moreover, a larger
and projections concerning investors.
with such requirements. For instance, share, 13 percent, were made in the first
DHS assumes that these administrative
DHS considered several alternatives, fees contribute to the revenues of half of 2017), as is reported in Figure 2:
and determined that a significant share RCs.142 While the RCs submit
143 See ‘‘How to Comply with the Regulatory
141 Section
projections of anticipated numbers of Flexibility Act,’’ (2017) U.S. Small Business
607 of the RFA, Preparation of
Analyses, states that in complying with the
investors, the actual investments and Administration, Office of Advocacy, available at
provisions of sections 603 and 604 of this title, an related Form I–526 filings submitted page. 114, available at https://www.sba.gov/sites/
agency may provide either a quantifiable or default/files/advocacy/How-to-Comply-with-the-

numerical description of the effects of a proposed 142 The administrative fees charged to the investor RFA-WEB.pdf.
rule or alternatives to the proposed rule, or more may cover various charges related to the economic 144 The SBA Table of Small Business Size
general descriptive statements if quantification is impact analysis, legal fees, business plan Standards is found at: https://www.sba.gov/sites/
not practicable or reliable. development, and immigration services fees. default/files/files/Size.
For the purposes of this analysis, DHS and the first half of 2017 does not be classified under NAICS code
assumes that each Form I–526 filed exactly match the SBA size standard subsection 523, as either ‘‘an entity
under an RC represents an instance in time-frame, which is based on a single engaged in miscellaneous investment
which the RC will receive an calendar year. However, DHS believes activities’’ or ‘‘an entity engaged in
administrative fee that will contribute to that this is the best analysis that can be miscellaneous intermediation.’’
the RC’s revenue. Although DHS cannot conducted given the uniqueness of However, DHS believes that the coding
assume that administrative fees are paid regional centers. DHS believes that our we chose is the most appropriate to use
when the forms are filed, this analysis modified methodology provides a in the analysis because it applies to the
assumes the fees will be paid reasonable estimate of RC revenue.145 majority of regional center projects, and
eventually. To determine the appropriate size thus is a more accurate reflection of the
DHS believes that the Form I–526 standard for the RCs, DHS extensively regional center entities.146
filings made through RCs that were reviewed various NAICS codes. DHS DHS again caveats that due to the
designated in 2014 are a reasonable determined that NAICS code 522310, uniqueness of the RC business operation
benchmark for analysis that mitigate the Mortgage and Nonmortgage Loan system and constraints on data, this
aforementioned constraints as best as Brokers defined as an ‘‘industry [that] analysis incorporates some
possible. comprises establishments primarily modifications to the typical
For the RCs approved in 2014 that engaged in arranging loans by bringing methodology that DHS utilizes in its
had EDDs with viable information, and borrowers and lenders together on a rulemakings. Namely, DHS had to use a
were non-terminated and ‘‘active’’ commission or fee basis,’’ may be an three-and-a-half-year timeframe instead
(meaning that they actually had Form I– appropriate NAICS industry in which of the standard one-year timeframe and
526 filings in 2016), we obtained a RCs might be found given the typical was compelled to assign an industry
cohort of 95 RCs that were associated activities undertaken by RC-associated code based on a description of RCs that
with 6,308 individual investors. DHS NCEs (loaning EB–5 capital to the JCEs) is our best knowledge of how RCs tend
analysis reveals that the number of and the role typically undertaken by to function. Lastly, we note that the
investors per RC varies substantially, RCs in facilitating those activities. The number of investors utilized likely
with a range of 2,272. The distribution SBA size standard for the NAICS understates the true time-independent
is highly right-skewed, with a mean of category chosen is based on a revenue revenue of RCs since there will
85, a median of 39, and a skewness of $7.5 million. DHS compared the generally be forthcoming investments
value of 8. These results indicate revenues of the 95 RCs against this size (and associated fee payments) not
suggest that the median is a proper standard and concludes that measurable at the point in time when
measure for central location. Next, DHS approximately 89 percent of RCs may be the analysis was conducted.
analyzed the administrative fees in the small entities for the purposes of this While DHS believes the methodology
FRFA. Extrapolating this share to the described in this section can lead to
cohort. The distribution is tight (or
864 approved RCs would mean that reasonable assumptions on the number
clustered closely together) with both the
approximately 769 RCs may be small of small entities that may be RCs, DHS
mean and median at $50,000. Next DHS
entities. still cannot determine the exact impact
estimated revenues for each RC in the
DHS evaluated the suggestion from a of this rule on those small entities. Part
analytical cohort by multiplying the
commenter that regional centers should of this issue is due to the fact that DHS
total number of investors who filed a
is not sure how many, if any, investors
Form I–526 for each RC by its actual
145 An additional assumption in this FRFA will be deterred from the EB–5 program
administrative fee reported on the EDD,
analysis is that the only source of regional center

which yielded a median revenue revenue is administrative fees charged to each 146 DHS points out for the administrative record
amount of $1,250,000 over the period investor. DHS believes that some regional centers that even though a large majority of regional centers
considered. DHS recognizes that by may also obtain revenue from charges made to would be small entities under the analysis
using the total number of investors who NCEs for management, consulting, or loan undertaken, both classifications recommended by
arrangements. DHS does not have data on these fees the commenter would involve revenue based size
filed a Form I–526 for each RC over the and thus relies on the aforementioned assumption standards of $38.5 million, which means that an
course of 2014, when the RC was of the single revenue stream accruing to even larger share of regional centers would be small
designated, FYs years 2015 and 2016,
ER24JY19.013</GPH>
administrative fees charged to investors. entities.
due to the increased investment or political subdivision of TEA identify a commuting-pattern standard
amounts and the new TEA configurations to an area containing up that would appropriately limit the
requirements. DHS cannot estimate the to, but no more than, 12 contiguous geographic scope of a TEA designation
full potential impact of this rule on RC census tracts, an option currently used consistent with the statute and the
revenue. by the state of California in its TEA policy goals of this proposed regulation.
5. A Description of the Projected designation process.147 However, DHS With respect to the minimum
Reporting, Recordkeeping and Other is not confident that this option is investment amount provision, DHS
Compliance Requirements of the Rule, necessarily appropriate for nationwide proposed an alternative to setting the
Including an Estimate of the Classes of application, as the limitation to 12 reduced TEA investment amount to half
Small Entities Which Will Be Subject to census tracts may be justifiable for of the standard minimum amount
the Requirement and the Type of reasons specific to California but may ($900,000 instead of $1,350,000),
Professional Skills Necessary for not be practical on a national scale. consistent with the existing regulatory
Preparation of the Report or Record. Another significant alternative DHS framework.149 DHS initially proposed a
The final rule does not directly considered that would be relatively reduction to 75 percent rather than 50
impose any new or additional straightforward to implement and percent of the standard minimum
‘‘reporting’’ or ‘‘recordkeeping’’ understand would be to limit the amount to better balance the
requirements on filers of Forms I–526, geographic or political subdivision of Congressional aim of incentivizing
I–829 or I–924. The rule does not the TEA to the actual project tract(s). investment in TEAs with the goal of
require any new professional skills for While this option would be easy to put encouraging greater investment in the
reporting. However, the rule may create in practice for both stakeholders and the United States more generally. History
some additional time burden costs agency, it was considered too restrictive suggests that a 50 percent reduction
related to reviewing the proposed in that it would exclude immediately coincides with an imbalance in favor of
provisions, as is discussed earlier. As adjacent areas that would be affected by TEA investments. DHS continues to
noted, DHS believes that lawyers would the investment. have some concern about the imbalance,
likely review the rule and that it would DHS also considered options based on though Congress granted DHS explicit
take about 4 hours to review and inform a ‘‘commuter pattern’’ analysis, which authority to create this ‘‘imbalance’’ to
any additional parties of the changes in focuses on defining a TEA as incentivize investments in targeted
this rule. As was discussed above under encompassing the area in which employment areas. 8 U.S.C.
‘‘Miscellaneous Costs,’’ the current workers may live and be commuting 203(b)(5)(C)(ii). However, the reforms to
benefits-burdened hourly wage of a from, rather than just where the the designation process for certain high
lawyer is $100.28. At this rate each investment is made and where the new unemployment TEAs finalized in this
reviewing entity would face a commercial enterprise is principally rule will ensure that, even if some
familiarization cost of $401.12 doing business. The ‘‘commuter
While DHS has estimated these costs, imbalance remains, it is benefiting truly
pattern’’ proposal was deemed too deserving communities as Congress
and assumes that they may affect some operationally burdensome to implement
small entities, for reasons stated intended. Ultimately, DHS believes in a
as it posed challenges in establishing meaningful incentive to invest in rural
previously, data limitations prevent standards to determine the relevant
DHS from determining the extent of the areas and areas of true high-
commuting area that would fairly unemployment, and thus, upon careful
impact to the small entities. account for variances across the
6. A Description of the Steps the consideration of the comments related
country.148 In addition, DHS could not to this issue, DHS opted to retain the
Agency Has Taken to Minimize the
Significant Economic Impact on Small differential between TEA and non-TEA
147 See Cal. Governor’s Office of Bus. and Econ.
Entities Consistent with the Stated Dev., EB–5 Investor Visa Program, available at
investments at 50 percent.
Objectives of Application Statutes, http://business.ca.gov/International/ D. Unfunded Mandates Reform Act of
Including a Statement of the Factual, EB5Program.aspx.
148 In the NPRM and development of this final
1995
Policy, and Legal Reasons for Selecting rule, DHS reviewed a proposed commuter pattern
the Alternative Adopted in the Final The Unfunded Mandates Reform Act
analysis incorporating the data table from the
Rule and Why Each of the Other Federal Highway Administration, ‘‘CTPP 2006–
of 1995 (UMRA) is intended, among
Significant Alternatives to the Rule 2010 Census Tract Flows,’’ available at (http:// other things, to curb the practice of
Considered by the Agency Which Affect www.fhwa.dot.gov/planning/census_issues/ctpp/ imposing unfunded Federal mandates
data_products/2006-2010_tract_flows/) (last on State, local, and tribal governments.
the Impact on Small Entities Was updated Mar. 25, 2014). DHS also reviewed the
Rejected. CTTP updated status report (released in January
Title II of the UMRA requires each
While DHS has determined, via the 2018), entitled ‘‘CTPP Oversight Board is Federal agency to prepare a written
preceding analysis, that a significant Discontinuing Census TAZ for Small Geography statement assessing the effects of any
Data Reporting and Urging the Transportation Federal mandate in a proposed or final
share of regional centers may be Planning Community to Engage in 2020 Census
considered small entities, DHS does not Participant Statistical Areas Program (PSAP),’’
agency rule that may result in a $100
have enough data to determine the available at https://www.fhwa.dot.gov/planning/ million or more expenditure (adjusted
impact that this rule may have on those census_issues/ctpp/status_report/sr0118/ annually for inflation) in any one year
fhwahep18046.pdf, which will phase in slight by State, local, and tribal governments,
entities. Therefore, while many regional methodological changes over the next year. DHS
centers may be small entities, DHS found that the required steps to properly
in the aggregate, or by the private sector.
cannot determine whether this rule will manipulate the Census Transportation Planning The value equivalent of $100 million in
Product (CTPP) database might prove overly 1995 adjusted for inflation to 2016
have a substantial impact, positive or

burdensome for petitioners with insufficient levels by the Consumer Price Index for
negative, on those small entities. economic and statistical analysis backgrounds. As
DHS considered several alternatives an alternate methodology for TEA commuter
to reform the TEA designation process, pattern analysis, DHS reviewed data from the U.S. operationally burdensome, potentially requiring
but found that they did not adequately Census tool, On the Map, available at http:// hours of review to obtain the appropriate
onthemap.ces.census.gov/, which is tied to the U.S. unemployment rates for the commuting area.
accomplish the objective of INA section Census Bureau’s American Community Survey. 149 The current reduced minimum investment
203(b)(5)(B)(ii). One alternative DHS Although the interface appeared to be more user- amount ($500,000) is 50 percent of the standard
considered was limiting the geographic friendly overall, using this data would be minimum investment amount ($1,000,000).
All Urban Consumers (CPI–U) is $157 attempt to analyze a potential Status, Form I–829, Application for
million. environmental impact associated with Regional Center Designation Under the
As noted above, this rule does not changes to the agency’s administration Immigrant Investor Program, approved
include any unfunded Federal of the EB–5 program contemplated by OMB Control Number 1615–0045; and
mandates. The requirements of Title II this rule would be largely, if not Form I–924, Annual Certification of
of the UMRA, therefore, do not apply, completely, speculative. Specifically, Regional Center, and Form I–924A,
and DHS has not prepared a statement this rule changes a number of eligibility Supplement to Form I–924, approved
under the UMRA. requirements and introduces priority under OMB Control Number 1615–0061.
date retention for certain immigrant Specifically, the Form I–526 will
E. Executive Order 13132
investor petitioners. It also amends collect additional information about the
This rule would not have substantial existing regulations to reflect statutory targeted employment area and the new
direct effects on the States, on the changes and codifies existing EB–5 commercial enterprise into which the
relationship between the National program policies and procedures. petitioner is investing to determine the
Government and the states, or on the Additionally, the rule does not affect the eligibility of qualified aliens to enter the
distribution of power and number of visas which can be issued United States to engage in commercial
responsibilities among the various and for this reason as well would have enterprises. In accordance with the final
levels of government. Therefore, in no impact on the environment. DHS regulatory text, DHS is changing the title
accordance with section 6 of Executive does not know where new commercial of Form I–526 to ‘‘Immigrant Petition by
Order 13132, it is determined that this enterprises will be established, or where Alien Investor’’ from ‘‘Immigrant
rule does not have sufficient federalism petitioners will invest or live. To the Petition by Alien Entrepreneur.’’
implications to warrant the preparation degree that it is possible to ascertain DHS is also making two additional
of a federalism summary impact reasonably foreseeable impacts, DHS conforming changes. First, DHS will
statement. knows only that this rule does not update the references to the Form I–526,
change the number of visas Congress which will now be entitled ‘‘Immigrant
F. Executive Order 12988
initially authorized in 1990. Public Law Petition by Alien Investor’’ in Forms I–
This rule meets the applicable 101–649. With a current population in 829, I–924, and I–924A. Second, as this
standards set forth in sections (3)(a) and excess of 323 million and a land mass final rule replaces references to
(3)(b)(2) of Executive Order 12988. of 3.794 million square miles, an ‘‘entrepreneur’’ with ‘‘investor,’’ DHS
G. National Environmental Policy Act unchanged 10,000 visas annually is will replace the references to
insignificant by any measure. ‘‘entrepreneur’’ with ‘‘investor’’ in the
DHS Directive (Dir.) 023–01 Rev. 01 While DHS believes that NEPA Forms I–829, I–924, and I–924A.
and Instruction (Inst.) 023–01–001 Rev. frequently does not apply to USCIS Accordingly for Forms I–829, I–924, and
1 establish the policies and procedures rules, that analysis is unnecessary here I–924A, USCIS will submit a Form OMB
that DHS and its components use to because DHS has determined that if 83–C, Correction Worksheet, and
comply with NEPA and the Council on NEPA were to apply, this rule fits amended form and instructions to OMB
Environmental Quality (CEQ) within categorical exclusions number for review and approval in accordance
regulations for implementing NEPA, 40 A3(a) in Inst. 023–01–001 Rev. 01, with the PRA.
CFR parts 1500–1508. The CEQ Appendix A, Table 1: ‘‘Promulgation of
regulations allow federal agencies to rules . . . strictly of an administrative Overview of Information Collection-
establish, with CEQ review and or procedural nature’’ and A3(d) for Form I–526
concurrence, categories of actions which rules that interpret or amend an existing (1) Type of Information Collection:
experience has shown do not regulation without changing its Revision to a currently approved
individually or cumulatively have a environmental effect. information collection.
significant effect on the human This rule is not part of a larger action (2) Title of the Form/Collection:
environment (‘‘categorical exclusions’’) and presents no extraordinary Immigrant Petitioner by Alien
and, therefore, do not require an circumstances creating the potential for Entrepreneur.
Environmental Assessment (EA) or significant environmental effects. (3) Agency form number, if any, and
Environmental Impact Statement (EIS). Therefore, this proposed rule is the applicable component of the DHS
40 CFR 1507.3(b)(1)(iii), 1508.4. categorically excluded from further sponsoring the collection: Form I–526;
Inst. 023–01–001 Rev. 01 establishes NEPA review. USCIS.
Categorical Exclusions that DHS has (4) Affected public who will be asked
found to have no such effect. Inst. 023– H. Paperwork Reduction Act
or required to respond, as well as a brief
01–001 Rev. 01 Appendix A Table 1. Under the Paperwork Reduction Act abstract: Primary: Individuals. Form I–
Inst. 023–01 –001 Rev. 01 requires the of 1995 (PRA), Public Law 104–13, all 526 is used by the USCIS to determine
action to satisfy each of the following Departments are required to submit to if an alien can enter the U.S. to engage
three conditions: (1) The entire action the Office of Management and Budget in commercial enterprise
clearly fits within one or more of the (OMB), for review and approval, any (5) An estimate of the total number of
categorical exclusions; (2) the action is reporting requirements inherent in a respondents and the amount of time
not a piece of a larger action; and (3) no rule. See Public Law 104–13, 109 Stat. estimated for an average respondent to
extraordinary circumstances exist that 163 (May 22, 1995). USCIS is revising respond: The estimated total number of
create the potential for a significant one information collection in respondents for the information
association with this rulemaking action:
environmental effect. Inst. 023–01–001 collection is 15,799 and the estimated

Rev. 01 section V.B (1)–(3). Immigrant Petition by Alien hour burden per response is 1hour and
This final rule amends the regulations Entrepreneur (Form I–526), consistent 50 minutes.
implementing the EB–5 immigrant visa with the changes proposed in the (6) An estimate of the total public
program. The final rule purely relates to NPRM, and is making conforming burden (in hours) associated with the
the agency’s administration of the EB– changes to two information collections: collection: The total estimated annual
5 program. DHS does not believe that Petition by Entrepreneur to Remove hour burden associated with this
NEPA applies to this action as any Conditions on Permanent Resident collection is 28,912 hours.
(7) An estimate of the total public properly filed in accordance with the filed on or after November 21, 2019, the
burden (in cost) associated with the form instructions, with the appropriate amount of capital necessary to make a
collection: The estimated total annual fee(s), initial evidence, and any other qualifying investment in the United
cost burden associated with this supporting documentation. States is one million eight hundred
collection of information is $17,378,900. * * * * * thousand United States dollars
(c) Eligibility to file and continued ($1,800,000). Beginning on October 1,
List of Subjects 2024, and every five years thereafter,
eligibility. An alien may file a petition
8 CFR Part 204 for classification as an investor on his or this amount will automatically adjust
Administrative practice and her own behalf. for petitions filed on or after each
procedure, Adoption and foster care, (d) Priority date. The priority date of adjustment’s effective date, based on the
a petition for classification as an cumulative annual percentage change in
Immigration, Reporting and
investor is the date the completed, the unadjusted All Items Consumer
recordkeeping requirements.
signed petition (including all initial Price Index for All Urban Consumers
8 CFR Part 216 evidence and the correct fee) is properly (CPI–U) for the U.S. City Average
Administrative practice and filed. The priority date of an immigrant reported by the Bureau of Labor
procedure, Aliens. petition approved for classification as Statistics, as compared to $1,000,000 in
an investor, including immigrant 1990. The qualifying investment amount
Regulatory Amendments will be rounded down to the nearest
petitions whose approval was revoked
Accordingly, DHS amends chapter I of on grounds other than those set forth hundred thousand. DHS may update
title 8 of the Code of Federal below, will apply to any subsequently this figure by publication of a technical
Regulations as follows: filed petition for classification under amendment in the Federal Register.
section 203(b)(5) of the Act for which (2) Targeted employment area. Unless
PART 204—IMMIGRANT PETITIONS otherwise specified, for EB–5 immigrant
the alien qualifies. A denied petition
petitions filed on or after November 21,
1. The authority citation for part 204 will not establish a priority date. A
■ 2019, the amount of capital necessary to
continues to read as follows: priority date is not transferable to
make a qualifying investment in a
another alien. In the event that the alien
Authority: 8 U.S.C. 1101, 1103, 1151, 1153, targeted employment area in the United
is the petitioner of multiple immigrant
1154, 1182, 1184, 1186a, 1255, 1324a, 1641; States is nine hundred thousand United
petitions approved for classification as
8 CFR part 2. States dollars ($900,000). Beginning on
an investor, the alien shall be entitled to
■ 2. Section 204.6 is amended by: October 1, 2024, and every five years
the earliest qualifying priority date. The
■ a. Revising the section heading and thereafter, this amount will
priority date of an immigrant petition
paragraphs (a), (c), and (d); automatically adjust for petitions filed
approved for classification as an on or after each adjustment’s effective
■ b. In paragraph (e): investor shall not be conferred to a
■ i. Removing the terms ‘‘entrepreneur’’ date, to be equal to 50 percent of the
subsequently filed petition if the alien standard minimum investment amount
and ‘‘entrepreneur’s’’ and adding in was lawfully admitted to the United
their place ‘‘investor’’ and ‘‘investor’s,’’ described in paragraph (f)(1) of this
States for permanent residence under section. DHS may update this figure by
respectively, in the definitions for section 203(b)(5) of the Act using the
Capital, Invest, and Qualifying publication of a technical amendment in
priority date of the earlier-approved the Federal Register.
employee; petition or if at any time USCIS revokes
■ ii. Removing the terms ‘‘Immigrant
(3) High employment area. Unless
the approval of the petition based on: otherwise specified, for EB–5 immigrant
Investor Pilot’’ and ‘‘Pilot’’ and adding (1) Fraud or a willful
in their place the term ‘‘Regional petitions filed on or after November 21,
misrepresentation of a material fact by 2019, the amount of capital necessary to
Center’’ in the definitions for Employee the petitioner; or
and Full-time employment; make a qualifying investment in a high
(2) A determination by USCIS that the employment area in the United States is
■ iii. Adding a definition for Regional petition approval was based on a
Center Program in alphabetical order; one million eight hundred thousand
material error. United States dollars ($1,800,000).
■ iv. Revising the definitions for Rural (e) * * *
area and Targeted employment area; Beginning on October 1, 2024, and every
Regional Center Program means the five years thereafter, this amount will
■ v. Removing ‘‘entrepreneur’s Form I– program established by Public Law 102–
526’’ and adding in its place ‘‘investor’s automatically adjust for petitions filed
395, Section 610, as amended. on or after each adjustment’s effective
EB–5 immigrant petition’’ in the Rural area means any area other than
definition for Troubled business; date, based on the cumulative annual
an area within a standard metropolitan percentage change in the unadjusted All
■ c. Revising paragraphs (f)(1), (2), and
statistical area (as designated by the Items Consumer Price Index for All
(3); Office of Management and Budget) or
■ d. In paragraph (g)(1), removing the Urban Consumers (CPI–U) for the U.S.
within the outer boundary of any city or City Average reported by the Bureau of
term ‘‘entrepreneur’’ and adding in its town having a population of 20,000 or
place the term ‘‘investor’’; Labor Statistics as compared to
more based on the most recent $1,000,000 in 1990. The qualifying
■ e. Revising paragraphs (g)(2), (i),
decennial census of the United States. investment amount will be rounded
(j)(2)(iii), (j)(5) introductory text, Targeted employment area means an
(j)(5)(iii), (j)(6)(i) and (ii), and (k); and down to the nearest hundred thousand.
area that, at the time of investment, is DHS may update this figure by
■ f. Adding paragraph (n).
a rural area or is designated as an area
The revisions and additions read as publication of a technical amendment in

that has experienced unemployment of the Federal Register.
follows:
at least 150 percent of the national (g) * * *
§ 204.6 Petitions for employment creation average rate. (2) Employment creation allocation.
immigrants. * * * * * The total number of full-time positions
(a) General. An EB–5 immigrant (f) * * * created for qualifying employees shall
petition to classify an alien under (1) General. Unless otherwise be allocated solely to those alien
section 203(b)(5) of the Act must be specified, for EB–5 immigrant petitions investors who have used the
establishment of the new commercial area not located within any standard ■ a. Revising the section and paragraph
enterprise as the basis for a petition. No metropolitan statistical area as (a)(1);
allocation must be made among persons designated by the Office of Management ■ b. Removing and reserving paragraph
not seeking classification under section and Budget, nor within any city or town (a)(4)(i);
203(b)(5) of the Act or among non- having a population of 20,000 or more ■ c. Removing ‘‘entrepreneur’’ and
natural persons, either foreign or as based on the most recent decennial adding in its place ‘‘investor’’ in
domestic. USCIS will recognize any census of the United States; or paragraph (a)(4)(iv);
reasonable agreement made among the (ii) In the case of a high ■ d. Revising paragraphs (a)(5) and (6)
alien investors in regard to the unemployment area: and (b);
identification and allocation of such (A) Evidence that the metropolitan ■ e. Removing and reserving paragraph
qualifying positions. statistical area, the specific county (c)(1)(i); and
within a metropolitan statistical area, ■ f. Revising paragraphs (c)(2) and (d).
* * * * * The revisions read as follows:
(i) Special designation of a high the county in which a city or town with
unemployment area. USCIS may a population of 20,000 or more is
§ 216.6 Petition by investor to remove
designate as an area of high located, or the city or town with a conditional basis of lawful permanent
unemployment (at least 150 percent of population of 20,000 or more outside of resident status.
a metropolitan statistical area, in which
the national average rate) a census tract (a) * * *
the new commercial enterprise is (1) General procedures. (i) A petition
or contiguous census tracts in which the
principally doing business has to remove the conditional basis of the
new commercial enterprise is
experienced an average unemployment
principally doing business, and may permanent resident status of an investor
rate of at least 150 percent of the
also include any or all census tracts accorded conditional permanent
national average rate; or
directly adjacent to such census tract(s). (B) A description of the boundaries residence pursuant to section 203(b)(5)
The weighted average of the and the unemployment statistics for the of the Act must be filed by the investor
unemployment rate for the subdivision, area for which designation is sought as with the appropriate fee. The investor
based on the labor force employment set forth in paragraph (i) of this section, must file within the 90-day period
measure for each census tract, must be and the reliable method or methods by preceding the second anniversary of the
at least 150 percent of the national which the unemployment statistics were date on which the investor acquired
average unemployment rate. obtained. conditional permanent residence. Before
(j) * * * (k) Decision. The petitioner will be the petition may be considered as
(2) * * * notified of the decision, and, if the properly filed, it must be accompanied
(iii) Evidence of property transferred petition is denied, of the reasons for the by the fee required under 8 CFR
from abroad for use in the United States denial. The petitioner has the right to 103.7(b)(1), and by documentation as
enterprise, including U.S. Customs and appeal the denial to the Administrative described in paragraph (a)(4) of this
Border Protection commercial entry Appeals Office in accordance with the section, and it must be properly signed
documents, bills of lading, and transit provisions of part 103 of this chapter. by the investor. Upon receipt of a
insurance policies containing properly filed petition, the investor’s
* * * * *
ownership information and sufficient conditional permanent resident status
(n) Offering amendments or
information to identify the property and shall be extended automatically, if
supplements. Amendments or
to indicate the fair market value of such necessary, until such time as USCIS has
supplements to any offering necessary
property; adjudicated the petition.
to maintain compliance with applicable
* * * * * securities laws based upon changes to (ii) The investor’s spouse and
(5) Petitioner engagement. To show this section effective on November 21, children may be included in the
that the petitioner is or will be engaged 2019 shall not independently result in investor’s petition to remove conditions.
in the new commercial enterprise, either denial or revocation of a petition for Where the investor’s spouse and
through the exercise of day-to-day classification under section 203(b)(5) of children are not included in the
managerial control or through policy the Act, provided that the petitioner: investor’s petition to remove conditions,
formulation, the petition must be (1) Filed the petition for classification the spouse and each child must each file
accompanied by: under section 203(b)(5) of the Act prior his or her own petition to remove the
* * * * * to November 21, 2019; conditions on their permanent resident
(iii) Evidence that the petitioner is (2) Was eligible for classification status, unless the investor is deceased.
engaged in policy making activities. For under 203(b)(5) of the Act at the time If the investor is deceased, the spouse
purposes of this section, a petitioner the petition was filed; and and children may file separate petitions
will be considered sufficiently engaged (3) Is eligible for classification under or may be included in one petition. A
in policy making activities if the 203(b)(5) of the Act, including having child who reached the age of 21 or who
petitioner is an equity holder in the new no right to withdraw or rescind the married during the period of conditional
commercial enterprise and the investment or commitment to invest permanent residence, or a former spouse
organizational documents of the new into such offering, at the time of who became divorced from the investor
commercial enterprise provide the adjudication of the petition. during the period of conditional
petitioner with certain rights, powers, permanent residence, may be included
and duties normally granted to equity PART 216—CONDITIONAL BASIS OF in the investor’s petition or must each
LAWFUL PERMANENT RESIDENCE file a separate petition.
holders of the new commercial

enterprise’s type of entity in the STATUS * * * * *
jurisdiction in which the new (5) Termination of status for failure to
■ 3. The authority citation for part 216
commercial enterprise is organized. file petition. Failure to properly file the
continues to read as follows:
(6) * * * petition to remove conditions within the
(i) In the case of a rural area, evidence Authority: 8 U.S.C. 1101, 1103, 1154, 1184, 90-day period immediately preceding
that the new commercial enterprise is 1186a, 1186b, and 8 CFR part 2. the second anniversary of the date on
principally doing business within an ■ 4. Amend § 216.6 by: which the investor obtained lawful
permanent residence on a conditional petition to remove conditions for fails to overcome such derogatory
basis shall result in the automatic investors shall be conducted by a USCIS information or evidence that the
termination of the investor’s permanent immigration officer at the office that has investment funds were obtained through
resident status and the initiation of jurisdiction over either the location of other than legal means, USCIS may
removal proceedings. USCIS shall send the investor’s commercial enterprise in deny the petition, terminate the
a written notice of termination and a the United States, the investor’s investor’s permanent resident status,
notice to appear to an investor who fails residence in the United States, or the and issue a notice to appear. If
to timely file a petition for removal of location of the adjudication of the derogatory information not relating to
conditions. No appeal shall lie from this petition, at the agency’s discretion. any of these issues is determined during
decision; however, the investor may (3) Termination of status for failure to the course of the interview, such
request a review of the determination appear for interview. If the investor fails information shall be forwarded to the
during removal proceedings. In to appear for an interview in connection investigations unit for appropriate
proceedings, the burden of proof shall with the petition when requested by action. If no unresolved derogatory
rest with the investor to show by a USCIS, the investor’s permanent information is determined relating to
preponderance of the evidence that he resident status will be automatically these issues, the petition shall be
or she complied with the requirement to terminated as of the second anniversary approved and the conditional basis of
file the petition within the designated of the date on which the investor the investor’s permanent resident status
period. USCIS may deem the petition to obtained permanent residence. The
removed, regardless of any action taken
have been filed prior to the second investor will be provided with written
or contemplated regarding other
anniversary of the investor’s obtaining notification of the termination and the
possible grounds for removal.
conditional permanent resident status reasons therefore, and a notice to appear
and accept and consider a late petition shall be issued placing the investor in (d) Decision—(1) Approval. If, after
if the investor demonstrates to USCIS’ removal proceedings. The investor may initial review or after the interview,
satisfaction that failure to file a timely seek review of the decision to terminate USCIS approves the petition, USCIS
petition was for good cause and due to his or her status in such proceedings, will remove the conditional basis of the
extenuating circumstances. If the late but the burden shall be on the investor investor’s permanent resident status as
petition is filed prior to jurisdiction to establish by a preponderance of the of the second anniversary of the date on
vesting with the immigration judge in evidence that he or she complied with which the investor acquired conditional
proceedings and USCIS excuses the late the interview requirements. If the permanent residence. USCIS shall
filing and approves the petition, USCIS investor has failed to appear for a provide written notice of the decision to
shall restore the investor’s permanent scheduled interview, he or she may the investor. USCIS may request the
resident status, remove the conditional submit a written request to USCIS investor and derivative family members
basis of such status, and cancel any asking that the interview be rescheduled to appear for biometrics at a USCIS
outstanding notice to appear in or that the interview be waived. That facility for processing for a new
accordance with 8 CFR 239.2. If the request should explain his or her failure Permanent Resident Card.
petition is not filed until after to appear for the scheduled interview, (2) Denial. If, after initial review or
jurisdiction vests with the immigration and if a request for waiver of the after the interview, USCIS denies the
judge, the immigration judge may interview, the reasons such waiver
petition, USCIS will provide written
terminate the matter upon joint motion should be granted. If USCIS determines
notice to the investor of the decision
by the investor and DHS. that there is good cause for granting the
and the reason(s) therefore, and shall
(6) Death of investor and effect on request, the interview may be
issue a notice to appear. The investor’s
spouse and children. If an investor dies rescheduled or waived, as appropriate.
If USCIS waives the interview, USCIS lawful permanent resident status and
during the prescribed 2-year period of
conditional permanent residence, the shall restore the investor’s conditional that of his or her spouse and any
spouse and children of the investor will permanent resident status, cancel any children shall be terminated as of the
be eligible for removal of conditions if outstanding notice to appear in date of USCIS’ written decision. The
it can be demonstrated that the accordance with 8 CFR 239.2, and investor shall also be instructed to
conditions set forth in paragraph (a)(4) proceed to adjudicate the investor’s surrender any Permanent Resident Card
of this section have been met. petition. If USCIS reschedules that previously issued by USCIS. No appeal
(b) Petition review—(1) Authority to investor’s interview, USCIS shall restore shall lie from this decision; however,
waive interview. USCIS shall review the the investor’s conditional permanent the investor may seek review of the
petition to remove conditions and the resident status, and cancel any decision in removal proceedings. In
supporting documents to determine outstanding notice to appear in proceedings, the burden shall rest with
whether to waive the interview required accordance with 8 CFR 239.2. USCIS to establish by a preponderance
by the Act. If satisfied that the (c) * * * of the evidence that the facts and
requirements set forth in paragraph (2) If derogatory information is information in the investor’s petition for
(c)(1) of this section have been met, determined regarding any of these removal of conditions are not true and
USCIS may waive the interview and issues or it becomes known to the that the petition was properly denied.
approve the petition. If not so satisfied, government that the investor obtained
Kevin K. McAleenan,
then USCIS may require that an his or her investment funds through
interview of the investor be conducted. other than legal means, USCIS shall Acting Secretary of Homeland Security.
(2) Location of interview. Unless offer the investor the opportunity to [FR Doc. 2019–15000 Filed 7–23–19; 8:45 am]
waived, an interview relating to the rebut such information. If the investor BILLING CODE 4410–10–P

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35750 Federal Register / Vol. 84, No.

142 / Wednesday, July 24, 2019 / Rules and Regulations

4. Removal of Conditions To Classify Regional Centers 1186b, which places conditions on

Priority Date Retention

TABLE 2—SUMMARY OF CHANGES AND IMPACT OF THE ADOPTED PROVISIONS—Continued

Increases to Investment Amounts

TABLE 2—SUMMARY OF CHANGES AND IMPACT OF THE ADOPTED PROVISIONS—Continued

• Some petitioners will benefit by traveling

E. Effective Date F. Implementation II. Background

7 When demand for a visa exceeds the number of

desired to solicit additional data from 82 FR 3211 (Jan. 11, 2017).

In addition, certain changes to a with young children to invest in other

approved. 14, 2017). 2016).

child-status-protection-act. established eligibility. 2016).

potentially result in a longer wait in the

39 Investor Program, Government of Quebec,

47 CPI–U measures the average change over time

minimum investment amount might

50 percent, a reduction of $900,000 from job creation needs.’’)

economic growth and opportunities for

notes that over 80 percent of EB–5 (statement of Sen. Simon).

samplings/2011/07/what-are-census-blocks.html calculation being unaffected by the size

‘‘Is the Investor Program an Underperforming intended.

files his petition.’’); see also Matter of Izummi, 22

expressed concerns about processing argued that the proposed rule, if

change policy to allow those with

initially proposed $1.35 million.

Management and Budget (OMB) Circular A–25,

significant number, if not the majority, commenter, it is counterproductive to

Congresses. In fact, the Chairs of the

Priority Date Retention

TABLE 2—SUMMARY OF CHANGES AND IMPACT OF THE ADOPTED PROVISIONS—Continued

Increases to Investment Amounts

TABLE 2—SUMMARY OF CHANGES AND IMPACT OF THE ADOPTED PROVISIONS—Continued

TABLE 4—PROJECTED INVESTMENT AMOUNTS AT 5-YEAR REVISIONS

Projected investment amount

Standard Investment Amount = $1.8 Million in 2018 .................................................................. 5 1.95 2.12

TABLE 5—TEA METRICS

Not affected by the rule ................................................................................... 6,207 46 832 57

until a more detailed analysis of small

agency may provide either a quantifiable or default/files/advocacy/How-to-Comply-with-the-

analysis is that the only source of regional center

administrative fees charged to investors. entities.

have a substantial impact, positive or

environmental effect. Inst. 023–01–001 collection is 15,799 and the estimated

The revisions and additions read as publication of a technical amendment in

holders of the new commercial

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