The first petition EB-5 Immigrant Investor Program participants submit is the I-526 petition, which has long been subject to lengthy processing times. Investors from a backlogged country—as of March 2021, Vietnam and China—have experienced especially long waits.
Despite long-standing processing delays, United States Citizenship and Immigration Services (USCIS) has not fixed the program’s inefficiencies and even had its own financial difficulties in 2020. However, long processing times discourage participation in the EB-5 investment program. Many prospective participants have understandably instead chosen to pursue the residency-by-investment programs offered by other countries, such as Canada or Australia, which is more expedient than an EB-5 investment. However, 2021 may just be the ideal time to make an EB5 investment, given that the EB-5 processing times situation looks to be somewhat improved.
Breaking Down USCIS’s Estimated Processing Times
USCIS’s posted I-526 petition estimated processing times, as of March 25, 2021, range from 29 to 57.5 months. This high number discourages many prospective investors—however, these figures are incredibly misleading as most I-526 petitions are adjudicated outside the range. The higher number represents the time by which 93% of petitions are processed, while the lower number represents the time by which 50% of petitions are adjudicated. Even if we assume that these estimates are accurate, 57% of I-526 petitions are processed outside of the range, with 50% being processed even sooner than 29 months.
USCIS’s historical average processing times support this interpretation. The 29 to 57.5 months represented in the estimated processing time range is quite different from the 14.2 months indicated as the I-526 petition’s historical average processing time for FY2020. Even without considering the likely changes to the EB-5 program, an investor’s petition is likely to be adjudicated far quicker than expected.
Proposed EB-5 Reform
EB-5 industry representatives have long advocated for reforms to the program, and it appears 2021 may be the year that this much-need reform finally materializes.
Bipartisan senatorial duo Patrick Leahy and Chuck Grassley have introduced to Congress the EB-5 Reform and Integrity Act, which would improve the EB-5 program by increasing security, better protecting honest actors, and procuring the long-term reauthorization for the EB-5 Regional Center Program. The regional center’s sunset date of June 30, 2021, serves as the impetus to finally pass reform, with reform considered the key to saving the regional center program.
Although the EB-5 Reform and Integrity Act focuses on integrity measures, it also includes a provision to shorten processing times. The bill would require USCIS to adjudicate investor petitions in less than 240 days. If the EB5 investment were located in a targeted employment area (TEA), this processing time would be just 120 days.
Biden’s Proposed USCIS Reform
The EB-5 Reform and Integrity Act is not the EB-5 investment program’s only chance at reform. The Biden administration is considering overhauling the U.S. immigration system, which, although not directly addressing the EB-5 program, would still benefit the EB-5 industry greatly.
The bill, called the U.S. Citizenship Act of 2021, includes several proposals that would increase the number of visas available to EB-5 investment participants as well as provisions to accelerate visa processing across all USCIS programs. The bill would recapture unused visas and then reuse them in the same program the next fiscal year instead of simply rolling them over to other programs. This would allow the EB-5 investment program to keep the thousands of extra visas allocated to it in FY2021. Another proposal would also exempt spouses and dependent children from employment-based visa quotas, freeing up thousands of EB-5 visas every year while still allowing immediate family members to immigrate with EB-5 investors. Biden’s proposed reforms offer important changes for Chinese investors specifically. Chinese investors have historically suffered massive backlogs, which have discouraged EB-5 investment from China. One reform, however, would require USCIS to clear its many lengthy backlogs, finally ending the long wait Chinese EB-5 investors have faced. Another reform would abolish country-based limitations, freeing up countless EB-5 visas from high-demand countries like China and Vietnam.
Why 2021 Is the Best Time to Invest
Neither bill has been passed yet. Considering the massive positive effects these changes would have on the EB5 investment program, the best time to invest in the program is before they’re passed. Otherwise, the enactment of either or both bills could see a wave of fresh I-526 applications, with those who had previously made an investment in prime position to take advantage of the program’s benefits. While the outlook for new EB-5 applicants may currently appear bleak, a combination of a larger supply of EB5 investment visas and accelerated processing times may cause investors to receive their U.S. green card status far quicker than expected.