Processing Changes and High Unemployment: The EB-5 Program in 2020

I-526 Visa Availability Processing Approach

On March 31, 2020, United States Citizenship and Immigration Services (USCIS) implemented the visa availability approach for processing I-526 petitions. Whether this new approach will have a consequential effect on processing time remains to be seen. As of May 2020, I-526 processing times are estimated at 31 to 50.5 months, a slight change from the 33 to 50 month estimate in March 2020.

On the other hand, historical processing times for I-526 adjudications reached a five-year record low of 12.9 months during the first quarter of 2020, which covers October 2019 to January 2020. Adjudications have reportedly increased since the start of the COVID-19 pandemic. Since adjudications are done behind the scenes, the closure of public USCIS offices does not hinder the work of the Immigrant Investor Processing Office (IPO). In fact, it may even be allowing the IPO to focus on adjudicating petitions more quickly, according to anecdotal reports.

Effects of COVID-19

Unemployment rates across the United States have soared since the start of the COVID-19 pandemic. The EB-5 Immigrant Investor Program, which offers foreign investors a pathway to obtaining a U.S. green card through investments in the U.S. economy, may be able to help during this unprecedented time. In particular, the EB-5 program offers incentives for foreign investors to invest in targeted employment areas (TEAs), which are areas with high rates of unemployment.

The criterion for designating a location as TEA—an unemployment rate at least 150% higher than the national average of the previous year—may hinder the ability of the EB-5 program to provide the economic stimulation needed in the aftermath of COVID-19. The impact of COVID-19 on TEA designation will not be obvious until 2021, when I-526 petitions will be filed with unemployment data from 2020. The final unemployment numbers will depend on a number of factors: when the crisis ends, the number of business that close permanently, and the speed at which the economy bounces back. Due to the relative employment model used in determining TEA designation, it is likely that the TEA program will provide investment incentives only for the locations with the worst COVID-19 job loss numbers, leaving other areas to fend for themselves.

Some modest changes to the TEA system, as well as the overall EB-5 program, would place the program in a better position to help stimulate the U.S. economy. However, with that said, there are currently no planned changes for the EB-5 programs, and the rumors of sweeping changes to the program are unfounded.