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The program is placed in a very odd and non-helpful bureaucratic area for the excitement of international financial investment in the United States. Second, its scale is all wrong. We are giving away also much for also small of a financial investment. Even more, increasing financial backing half a million bucks a tranche is, to claim the least, ineffective.


The regional facilities, with their half-million schemes, essentially damaged the much more reasonable million-dollar part of the EB-5 program. Third, such programs, if we have them at all, as they perform in Australia, need to have to do with developing service entities, not passive investments. It must be about creating genuine work, not clarify estimations regarding the indirect development of work, which is currently part of the regulations.


Possibly that is just one of the reasons that it has failed every year to get to the legal objective of 10,000 investment visas. Fifth, the Regional Facility Program is naturally awkward, and the program is also full of middlemen, both public and exclusive. The program has even more than its share of scandals, which I will enter into later on if anyone is interested.


This is an agency that loves to state yes to applicants, yet as the table in my statement reveals, USCIS police officers have a lot more difficulty with EB-5 applications than others. I assume that is something that nobody has truly talked around a lot. EB5 Regional Center Program. There are high prices of internal rejections in this program and forever factor

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Seventh, in this program visas go to people who could not get them any type of various other way and to individuals whose scheduled investment is actually less, according to the Federal Get, than the average mean net worth of all American family members in 2007. Allow me expand on among my observations.


My quote based upon the investors' permit applications submitted 2 years after the initial investment-- these are the strong ones that continue to be and are authorized. This is 2009-- was that they had about $191 million verified-- that is my price quote. USCIS does not give the kind of data that we can utilize on this.


For every $100 of increased international financial investment that year, the EB program added one dime. Under a much more unsteady analytical base, the preliminary applications of would-be immigrant capitalists, USCIS is telling journalists that the degree of investment in the just-concluded year was concerning $1.2 billion. Let us approve that.

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Thanks for paying attention to me. I anticipate your remarks and inquiries. [The prepared statement of David North shows up as a submission for the document.] Chairman Leahy. Thanks. Our following witness is Robert Divine. He is an investor of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the company's migration practice group.




Divine offered as Principal Advice of the USA Citizenship and Migration Solutions from July 2004 till November 2006, the year in which he was Performing Supervisor, and after that Performing Replacement Director. He has actually functioned extensively with the EB-5 program secretive method. He was chosen, as I comprehend, vice head of state of the Association to Spend in United States, the nationwide sector organization of regional.


Divine, we are delighted to have you below. Please proceed, sir. DECLARATION OF ROBERT C. DIVINE, ATTORNEY, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE PRESIDENT, INVEST IN THE USA (IIUSA) Mr. Divine. Thank you, Mr. Chairman, Legislator Grassley, and others. Thanks for having me.


At a lot of, if all 10,000 ports were made use of, it would be 1 percent of the immigration yearly to the USA. It is not near that yet, but it is expanding and getting toward that. Particularly as USCIS, the agency that manages the program, has actually been making the rules more clear and the processes much more logical and clear for the people that are organizing investments and for the investors that are spending, more people have actually wanted and able to put effort and cash right into the procedure to find great tasks and establish them, and after that extra investors have been ready to spend their cash and take the risk and utilize the cash to create the work that is the factor of the program.

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These jobs do not linger permanently, and USCIS recognizes that and are trying to speed up the program, speed the process - EB5 Regional Center Program. That does not mean that they are unwinding their scrutiny, and, as a matter of fact, they are all set to deny applications that are not certifying. And they do so, as was discussed


The regional facility part of the program is not. It becomes part of an appropriations costs that was established in 1992, and given that then that program has been expanded 5 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 date of expiration in September.


The process takes a great while to work up a task and after that to obtain the capitalists authorized. And they do not want their money flowing through until they have been approved. And the specter of the expiry of this Regional Center Program in September is currently discouraging the development of projects.

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I would certainly like to clarify 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 function of the normal EB-5 regulation that is part of the code. It simply is a reality that a lot of the local facilities that are pooling financial investments have established those instead of high unemployment or in backwoods where fifty percent- here million-dollar financial investments are enabled, which makes good sense.