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The program is positioned in a very odd and non-helpful administrative area for the stimulation of worldwide financial investment in the United States. Second, its scale is all wrong. We are offering away excessive for as well little of an investment. Further, increasing equity capital half a million dollars a tranche is, to state the least, ineffective.

The regional facilities, with their half-million systems, basically undercut the much more sensible million-dollar component of the EB-5 program. Third, such programs, if we have them in all, as they carry out in Australia, must have to do with creating service entities, not passive investments. It needs to be regarding producing real work, not clarify computations about the indirect production of jobs, which is currently part of the regulation.


Possibly that is just one of the reasons why it has actually failed every year to get to the legislative goal of 10,000 investment visas. Fifth, the Regional Facility Program is inherently awkward, and the program is too loaded with middlemen, both public and exclusive. The program has even more than its share of scandals, which I will certainly enter into later if anyone is interested.


This is an agency that likes to state yes to applicants, however as the table in my testament shows, USCIS officers have much extra trouble with EB-5 applications than others. I think that is something that no one has actually truly talked around much. EB5 Regional Center Program. There are high rates of internal denials in this program and permanently reason

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Seventh, in this program visas go to people who might not obtain them differently and to people whose organized financial investment is actually less, according to the Federal Reserve, than the ordinary mean total assets of all American families in 2007. Let me expand on one of my observations.


My quote based on the financiers' permit applications filed 2 years after the first investment-- these are the strong ones that stay and are accepted. This is 2009-- was that they had regarding $191 million validated-- that is my price quote. USCIS does not supply the kind of information that we might use on this.


So for each $100 of boosted foreign financial investment that year, the EB program contributed one cent. Under a a lot more shaky statistical base, the preliminary applications of would-be immigrant investors, USCIS is telling journalists that the level of investment in the just-concluded year had to do with $1.2 billion. Let us approve that.

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Thanks for paying attention to me. I look onward to your comments and inquiries. [The prepared statement of David North appears as a submission for the record.] Chairman Leahy. Thank you. Our next witness is Robert Divine. He is a shareholder of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the firm's migration technique group.

Divine functioned as Principal Counsel of the USA Citizenship and Migration Providers from July 2004 up until November 2006, the year in which he was Acting Director, and afterwards Acting Deputy Director. He has functioned thoroughly with site web the EB-5 program secretive practice. view it now He was elected, as I comprehend, vice head of state of the Organization to Invest in United States, the national industry association of local centers.


Divine, we are pleased to have you below. Please go on, sir. STATEMENT OF ROBERT C. DIVINE, ATTORNEY, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE HEAD OF STATE, PURCHASE THE USA (IIUSA) Mr. Divine. Thanks, Mr. Chairman, Legislator Grassley, and others. Thank you for having me.


At the majority of, if all 10,000 slots were utilized, it would be 1 percent of the immigration each year to the USA. It is not near that yet, however it is growing and getting toward that. Specifically as USCIS, the firm that looks after the program, has actually been making the policies clearer and the procedures extra rational and clear for individuals that are arranging investments and for the financiers that are investing, more people have been ready and able to put effort and money into the process to discover good tasks and develop them, and then more investors have actually been ready to invest their cash and take the risk and make use of the cash to create the tasks that is the point of the program.

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These projects do not wait about for life, and USCIS recognizes that and are attempting to speed up the program, speed the process - EB5 Regional Center Program. That does not indicate that they are unwinding their examination, and, in truth, they are ready to reject applications that are not certifying. And they do so, as was mentioned

The local facility part of the program is not. It is component of an appropriations expense that was passed in 1992, and given that then that program has been prolonged 5 times for 19 years. It is time for it to be irreversible, and it needs to be done currently and not nearer to the day of expiry in September.


The procedure takes a great while to function up a project and afterwards to get the investors authorized. And they do not desire their money moving via up until they have been authorized. And the specter of the expiry of this Regional Facility Program in September is already inhibiting the growth of jobs.

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I would love to clear visit site up that the Regional Facility Program is not the like the half-million-dollar point. The concept of half a million or a million is a feature of the routine EB-5 legislation that is component of the code. It simply is a reality that the majority of the local centers that are pooling financial investments have actually established those instead of high joblessness or in rural locations where fifty percent- million-dollar investments are permitted, and that makes sense.