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First, the program is positioned in a very weird and non-helpful bureaucratic area for the excitement of worldwide financial investment in the United States. Second, its range is all wrong. We are giving away also much for as well small of a financial investment. Better, increasing equity capital half a million bucks a tranche is, to say the least, ineffective.


The regional facilities, with their half-million schemes, essentially undercut the a lot more reasonable million-dollar component of the EB-5 program. Third, such programs, if we have them in any way, as they carry out in Australia, need to be about creating company entities, not passive financial investments. It needs to be about creating actual work, not specify calculations concerning the indirect creation of work, which is currently component of the regulation.


Probably that is one of the reasons that it has actually fallen short time after time to get to the legal goal of 10,000 financial investment visas. Fifth, the Regional Facility Program is naturally clumsy, and the program is too full of middlemen, both public and exclusive. The program has more than its share of scandals, which I will enter into later if anybody is interested.


This is a firm that enjoys to state yes to applicants, but as the table in my testament reveals, USCIS officers have much extra difficulty with EB-5 applications than others. I think that is something that no one has really spoken about a lot. EB5 Regional Center Program. There are high rates of internal rejections in this program and forever reason

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Seventh, in this program visas go to individuals that might not obtain them any kind of various other means and to people whose planned financial investment is in fact less, according to the Federal Reserve, than the ordinary mean total assets of all American family members in 2007. Let me increase on one of my monitorings.


My quote based on the financiers' permit applications filed 2 years after the initial investment-- these are the solid ones that remain and are authorized. This is 2009-- was that they had about $191 million confirmed-- that is my price quote. USCIS does not give the sort of data that we can utilize on this.


For every $100 of enhanced international financial investment that year, the EB program added one dime. Under a much more wobbly statistical base, the preliminary applications of prospective immigrant financiers, USCIS is informing reporters that the degree of financial investment in the just-concluded year had to do with $1.2 billion. Let us accept that.

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Thank you for listening to me. I anticipate your comments and inquiries. [The ready statement of David North appears as an entry for the document.] Chairman Leahy. Thanks. 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 migration practice group.




Divine worked as Chief Advise of the USA Citizenship and Migration Providers from July 2004 until November 2006, the year in which he was Acting Director, and after that Performing Replacement Supervisor. He has actually functioned extensively with the EB-5 program secretive method. He was chosen, as I understand, vice president of the Association to Invest in U.S.A., the nationwide sector organization of regional facilities.


Divine, we are thrilled to have you right here. Please go ahead, sir. DECLARATION OF ROBERT C. DIVINE, LAWYER, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE PRESIDENT, BUY THE United States (IIUSA) Mr. Divine. Thanks, Mr. Chairman, Senator Grassley, and others. Thank you for having me.


At the majority of, if all 10,000 slots were made use of, it would certainly be 1 percent of the immigration every year to the USA. It is not near that yet, yet it is expanding and getting toward that. Particularly as USCIS, the firm that manages the program, has actually been making the regulations clearer and the processes more reasonable and clear for individuals that are arranging investments and for the capitalists who are spending, more people have actually been ready and able to put effort and cash into the process to find excellent tasks and establish them, and then much more investors have actually agreed to invest their cash and take the threat and utilize the cash to create the work that is the point of the program.

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These projects do not wait around forever, and USCIS recognizes that and are trying to speed up the program, speed up the procedure - EB5 Regional Center Program. That does not suggest that they are unwinding their examination, and, as a matter of fact, they are prepared to refute applications that are not qualifying. And they do so, as was stated


The local facility part of the program is not. It becomes part of an appropriations bill that was enacted in 1992, and since then that program has been prolonged 5 times for 19 years. It is time for it to be long-term, and it requires to be done currently and not nearer to the date of expiry in September.


The process takes a good while to develop a task and afterwards to get the investors authorized. And they do not want their money flowing via till they have here actually been authorized. And the specter of the expiration of this Regional Center Program in September is already preventing the advancement of tasks.

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I would like to clear up that the Regional Center Program is not the exact same as the half-million-dollar point. The concept of half a million or a million is a feature of the normal EB-5 legislation that is part of the code. It just is a fact that the majority of the regional facilities that are pooling investments have actually established those instead of high joblessness or in country locations where half- million-dollar financial investments are allowed, and that makes good sense.