How could this measure affect EB-5 investors and regional centers?
On January 3, 2023, United States Citizenship and Immigration Services (USCIS) issued a notice of proposed rulemaking (NPRM) to adjust the filing fees for its applications. While the filing fees for many USCIS applications across the various immigration programs are set to increase, it seems that the fees for EB-5 immigrant investors and regional center operators will undergo an especially sharp hike. Should USCIS follow through on the proposed fee increases, this measure could have a noticeable impact on the demand for the EB-5 industry and the program’s positive impact on the U.S. economy.
Why Has USCIS Proposed Higher Filing Fees?
Significant Filing Fee Increases for EB-5 Applications
The Path Ahead for EB-5 Investors and Regional Centers
Why Has USCIS Proposed Higher Filing Fees?
In an official press release, USCIS indicates that it reviews its filing fees every two years and has now realized the need for increased revenue (the filing fees have not been adjusted since 2016). Since 96% of the agency’s funding comes from the filing fees for the various immigration and naturalization applications—and not from congressional appropriations or other sources—increasing the filing fees would “allow USCIS to more fully recover its operating costs, reestablish and maintain timely case processing, and prevent the accumulation of future case backlogs.”
To this end, USCIS plans to “increase the number of adjudicators processing applications, implement technology improvements, and increase support provided to individuals seeking information and assistance from USCIS.”
It seems that the agency’s financial difficulties have largely been caused by the COVID-19 pandemic. At its height in 2020, COVID-19 significantly curtailed the volume of new USCIS applicants, which USCIS claims resulted in a 40% decrease in revenue. The press release further argues that funding constraints, compounded with a temporary pause on hiring and a reduced staff, have resulted in slower processing times and an increasing backlog of pending applications.
USCIS Director Ur Jaddou strongly supports the proposed measures and says this will allow the immigration authority to “more fully recover operating costs for the first time in six years and … support the Administration’s effort to rebuild the legal immigration system.”
While the EB-5 applications will be subject to much higher filing fees, USCIS says that the fee waiver eligibility criteria will stay the same for low-income and vulnerable populations. The agency also claims that the fee adjustments would “decrease or minimally increase fees for more than one million low-income filers each year.”
Before adjusting its filing fees, USCIS will allow for a 60-day public comment period during which it will receive feedback from the public. To this end, a public engagement session will be held on January 11.
Significant Filing Fee Increases for EB-5 Applications
USCIS proposes a steep increase for both applications for EB-5 immigrant investors and regional centers. As indicated in the graph below, the filing fee for Form I-526E, the initial application for a conditional Green Card, will increase from $3,675 to $11,160.
This represents an impressive 204% hike for the initial EB-5 immigrant petition.
Form I-829, the final petition for a permanent Green Card, will be adjusted from $3,835 to $9,525: a 148% increase.
Together, the new filing fees for EB-5 investors will now total $20,685. This constitutes more than 2.6% of the minimum EB-5 investment amount of $800,000. Prospective investors may be less inclined to begin the immigration process with such high upfront costs—and, per USCIS regulations, no guarantees of immigration success or contractual rights to repayment of their capital.
The USCIS applications for regional center designation will also become steeper. The filing fee for Form I-956, the petition for regional center designation, will increase 168% from $17,795 to $47,695. Form I-956F, the “project request” application required for all regional center offerings, will also be raised 168% from $17,795 to $47,695. And Form I-956G, the mandatory annual report for regional centers, will rise 47% from $3,035 to $4,470.
Steeper filing fees for both investor and regional center applications may hinder the EB-5 industry’s growth. A prominent EB-5 industry trade association calculates that EB-5 investors injected $20.6 billion into the U.S. economy between 2008 and 2015. Interestingly, approximately 93.4% of all EB-5 visas have been awarded to applicants who invested through a regional center, clearly illustrating the vital role of these entities. In addition, 207,000 jobs were supported through regional center funding in the 2014 and 2015 fiscal years.
This major support for the U.S. economy— even more valuable in view of steadily-increasing interest rates—may be reduced if fewer EB-5 investors and regional center operators are willing to submit applications to USCIS.
At the same time, USCIS processing times have not been getting significantly faster in recent months, leading many industry stakeholders to question whether these substantial fee increases are warranted.
The Path Ahead for EB-5 Investors and Regional Centers
USCIS will not adjust the filing fees until the 60-day comment period ends on March 6, 2023. While the proposed figures in the NPRM are not final, USCIS will likely adjust the filing fees shortly after March 6.
EB-5 investors and regional centers who would like to submit their USCIS applications at the current filing fees have a narrow timeframe to do so. EB5AN is currently offering consulting services for both EB-5 investors and regional centers to help them navigate the application process while staying abreast of the latest industry developments.
We invite you to schedule a free consultation with EB5AN today and find out the best way to begin the immigration process or raise EB-5 funding.
