By Reid Thomas, NES Financial Executive Vice President
In 2009, the popularity of the EB-5 program increased significantly. According to USCIS-published statistics, in that year 1,265 I-526 petitions were approved, doubling that of the previous year. Since then, the number of I-526 petitions being approved each year continues to grow. In fact, in the last two years alone there have been a total of 7,376 I-526 approvals. That is more than the previous 10 years combined! This tremendous upsurge in a relatively short period of time will lead to a parallel increase in the number of I-829 filings in the near term.
After an I-526 petition is approved, the investor establishes a two year conditional residency period. He or she must file an I-829 petition within 90 days of the expiration of the conditional residency period. Considering the USCIS-published statistics on I-526 petition approvals, and assuming it takes three to six months from the I-526 approval date to establish conditional residency, we should expect to see a significant increase in the number of I-829 filings very soon.
This impending spike of I-829 activity (the “I-829 bubble”) is unprecedented and is expected to strain the EB-5 ecosystem in new ways. For some stakeholders (e.g. immigration attorneys, regional centers), this may be their first practical experience with the I-829 process. The USCIS may experience backlogs similar to what we saw with the I-526 and extend I-829 processing times. Due to these factors, the number of RFEs on I-829 petitions could start to rise as well. Regional centers and developers need to be ahead of the game by making sure they are prepared with the correct documentation and information needed for their filings.
From an investor perspective, the filing of the I-829 petition is perhaps the most critical part of the EB-5 process, as it is the final stage in determining the success or failure of the immigration effort by an investor. The stakes are extremely high. Without proper preparation, investors face potential for lost investments, delays in processing should the USCIS request additional evidence, or even deportation.
A successful I-829 submission requires proper evidence to support that the required investment criteria were met and that the necessary job creation goals were achieved. This requires producing a comprehensive audit trail with supporting evidence spanning several years for each investor. This is a task that, if left to the last minute, can be costly and fraught with the possibility of error. On the other hand, early preparation, setup, and implementation will save time, money, and significantly improve the likelihood of success.
Because of the significance of having a successful I-829 adjudication and the effects of the impending I-829 bubble, now is the time for EB-5 issuers to make sure they are well-prepared. Careful planning and consulting with industry experts is a great place to start.