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First, the program is positioned in a very weird and non-helpful administrative place for the stimulation of worldwide financial investment in the United States. Second, its scale is all incorrect. We are handing out excessive for too small of an investment. Better, elevating financial backing fifty percent a million bucks a tranche is, to state the least, inefficient.


The regional facilities, with their half-million systems, basically damaged the a lot more practical million-dollar part of the EB-5 program. Third, such programs, if we have them at all, as they perform in Australia, ought to be about creating service entities, not easy financial investments. It ought to be about developing actual tasks, not clarify calculations about the indirect creation of jobs, which is now part of the legislation.


Maybe that is just one of the reasons it has actually stopped working year after year to get to the legal objective of 10,000 financial investment visas. Fifth, the Regional Center Program is inherently awkward, and the program is also full of intermediaries, both public and personal. The program has greater than its share of scandals, which I will enter later on if any person is interested.


This is an agency that enjoys to say yes to applicants, yet as the table in my testimony shows, USCIS policemans have far more difficulty with EB-5 applications than others. I assume that is something that nobody has actually really discussed a lot. EB5 Regional Center Program. There are high prices of interior denials in this program and forever reason

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Seventh, in this program visas most likely to individuals who could not obtain them otherwise and to individuals whose organized financial investment is in fact less, according to the Federal Get, than the average mean total assets of all American family members in 2007. Let me broaden on one of my observations.


My estimate based upon the investors' permit applications filed 2 years after the initial financial investment-- these are the solid ones that remain and are approved. This is 2009-- was that they had concerning $191 million validated-- that is my quote. USCIS does not offer the kind of information that we can make use of on this.


For every $100 of increased foreign investment that year, the EB program contributed one cent. Under a much more wobbly analytical base, the initial applications of would-be immigrant capitalists, USCIS is telling journalists that the level of investment in the just-concluded year was regarding $1.2 billion. Let us accept that.

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Thank you for listening to me. I look onward to your remarks and questions. [The prepared statement of David North looks like a submission for the record.] Website Chairman Leahy. Thank you. Our following witness is Robert Divine. He is a shareholder of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the firm's immigration practice group.




Divine offered as Chief Guidance of the USA Citizenship and Related Site Migration Solutions from July 2004 until November 2006, the year in which he was Performing Supervisor, and afterwards Acting Deputy Director. He has actually worked extensively with the EB-5 program secretive practice. He was elected, as I comprehend, vice president of the Organization to Buy USA, the nationwide industry association of regional facilities.


Divine, we are pleased to have you right here. Please proceed, sir. DECLARATION OF ROBERT C. DIVINE, LAWYER, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE HEAD OF STATE, INVEST IN THE United States (IIUSA) Mr. Divine. Thank you, Mr. Chairman, Legislator Grassley, and others. Thanks for having me.


At most, if all 10,000 slots were utilized, it would be 1 percent of the migration annually to the United States. It is not near that yet, however it is expanding and obtaining towards that. Specifically as USCIS, the firm that oversees the program, has actually been making the rules clearer and the procedures more rational and clear for the people that are arranging financial investments and for the capitalists that are spending, more individuals have actually agreed and able to place initiative and money into the process to find good jobs and establish them, and after that much more investors have been eager to spend their cash and take the risk and make use of the money to create the work that is the point of the program.

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These tasks do not linger for life, and USCIS recognizes that and are attempting to speed visit this site up the program, speed the procedure - EB5 Regional Center Program. That does not imply that they are unwinding their scrutiny, and, in truth, they prepare to refute applications that are not certifying. And they do so, as was mentioned


The regional facility part of the program is not. It belongs to an appropriations expense that was enacted in 1992, and ever since that program has been extended five times for 19 years. It is time for it to be long-term, and it requires to be done now and not nearer to the day of expiry in September.


The process takes a great while to function up a project and afterwards to obtain the investors approved. And they do not want their money moving with until they have been accepted. And the specter of the expiration of this Regional Center Program in September is already inhibiting the advancement of tasks.

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I wish to clear up that the Regional Facility Program is not the exact same as the half-million-dollar thing. The concept of half a million or a million is a feature of the routine EB-5 regulation that is component of the code. It just is a reality that a lot of the local facilities that are merging investments have established those instead of high unemployment or in backwoods where half- million-dollar financial investments are enabled, which makes feeling.