By Cory A. Richards and EB5Investors.com Staff
On May 14, 2014, Congressman Aaron Schock of Illinois and Congresswoman Tulsi Gabbard of Hawaii introduced bipartisan legislation with H.R. 4659 (also known as the “EB-5 Regional Center Extension Act of 2014”) that both permanently extends the EB-5 program and eliminates the program’s per country caps on visa allocations.
The bill joins a host of proposed EB-5-related legislation. Senator Patrick Leahy of Vermont has introduced the “Border Security, Economic Opportunity, and Immigration Mobilization Act” (S. 744). In the House, Congressman Jarod Polis of Colorado and three bipartisan cosponsors have introduced the “American Entrepreneurship and Investment Act of 2014” (HR 4178) and Congressman Darrell Issa of California has introduced the “Supplying Knowledge-Based Immigrants and Lifting Levels of STEM Visas Act” (HR 2131). So what is different about Schock and Gabbard’s bill?
The Schock and Gabbard bill is much narrower in scope than the other pieces of legislation. While the other bills address an array of issues relating to EB-5, the bill proposed by Schock and Gabbard has only the two objectives of making the program permanent and eliminating the cap. A representative of Schock’s office stated that the bill does not address any other EB-5-related issues because those issues might be better served when addressed as part of a comprehensive immigration reform package. While the bill would leave the program nearly entirely as is, the cap would be eliminated because the Congressman believes there is ample evidence that shows the cap has hindered investors, along with administration and enforcement of the program. The cap was instituted to ensure that investors from all countries would have an equal opportunity to participate in the program. However, with a handful of nations producing a high percentage of all EB-5 investors, Schock believes there is no need to limit investor capital from those nations because doing so will not impact participation of investors from other nations.
The EB-5 Regional Center program has been extended twice in the last five years. Most recently in 2012 the House voted overwhelmingly (412-3) in favor of the extension of the program until September 30, 2015. Of the program’s total number of investors, 90 percent invest in job creating entities through regional centers, meaning that allowing the Regional Center Pilot Program to expire would effectively destroy the main purpose of the EB-5 program: to create jobs.
“Repeatedly, EB-5 program extensions have received overwhelming bipartisan support,” stated Schock in his press release. “This much-needed legislation underscores the importance of an incremental approach to immigration reform as Congress seeks common ground to address our nation’s broken system.”
Job creation is at the forefront in Washington D.C. and at many kitchen tables across this nation. That said, the message that H.R. 4659 sends could not be timelier: The EB-5 Regional Center program is a remarkably effective catalyst for job creation and Congress should act expeditiously to permanently reauthorize it. The introduction of H.R. 4659, along with other legislation, shows that members of Congress are noticing the benefits that the EB-5 program creates for the U.S. economy. According to an IIUSA peer-reviewed study, the EB-5 program contributed $3.4 billion to U.S. gross domestic product (GDP) in 2012, supported 42,000 U.S. jobs, and generated $712 million in federal, state and local tax revenues. [1]
Schock and Gabbbard’s bill may provide Congress with an easy way to permanently extend the program because their bill has such a narrow focus. The other pieces of legislation would also make the program permanent, but they address a wide range of issues related to EB-5. While the program may certainly benefit from addressing these problems, these broader bills run the risk of getting bogged down in the legislative process. If Congress is not up for such a debate, the Schock bill provides a quick and viable alternative to keep the program moving forward.
[1] IIUSA “Economic Impact Report of the EB-5 Program 2012: An Economic Development Program for the 21st Century”
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