By Ana Durrani
The FY 2023 report from the United States Citizenship and Immigration Services (USCIS) indicates that 231 Form I-956Fs were pending approval by the end of September 2023. Industry stakeholders say this number offers some telling takeaways.
“First, that’s a lot of projects, and this confirms that the long-term extension and the implementation of the RIA put EB-5 on a solid footing for project developers and investor families as a feasible path of raising EB-5 capital, creating American jobs and obtaining the U.S. green card,” says Greg Sheehan, director of EB-5 investment platform and USCIS Compliance at Behring Co.
The FY 2023 report also shows that 12 Form I-956Fs were approved across both high unemployment and rural targeted employment areas (TEA).
“Developers and investors are pleased to see approvals in both rural and high unemployment categories,” says Sheehan.
What is Form I-956F and why is it relevant to regional centers and EB-5 investors?
Form I-956F is a new petition introduced by USCIS with the EB-5 Reform and Integrity Act of 2022 (RIA). The regulation requires regional centers (RC) to file this form for every EB-5 investment before submitting an I-526E. Its approval signifies that USCIS has assessed and verified the compliance of the EB-5 project.
“Secondly, that’s a lot of visas to fill, and this is a double-edged sword,” says Sheehan. “Despite bumper crop years of visa inventory in FY 2024 and FY 2025, meaningful success of the RIA depends on the efficient and timely processing by USCIS and DOS to prevent unnecessary visa backlogs.”
He cautions that should the immigration agency fail to prevent backlogs, the carryover visas for the reserved categories, which he says most of the projects likely qualify for, will be wasted.
“In the face of extended visa backlogs for China and India, investor families may hesitate once again to look to EB-5, feeling echoes of 2015 and 2018, and these projects will not succeed in meeting their targets,” says Sheehan.
Vivek Tandon, the CEO and founder of EB5 BRICS, says the number of pending I-956Fs does not surprise him.
“Our platform for EB-5 investors that are looking for pre-vetted projects that have gone through extensive due diligence also tends to attract a lot of regional centers and developers,” says Tandon.
Tandon adds that in the current high interest rate environment without relief in sight, a growing number of projects are looking for EB-5 funding to optimize their cost of capital, which has caused more I-956Fs pending with USCIS.
“We’re seeing approvals in about nine to 12 months, but sometimes RCs are having to file writ of mandamus to get their file picked up for adjudication,” says Tandon.
Meanwhile, Dennis Tristani, managing attorney at Tristani Law, LLC, says the EB-5 industry is witnessing “a pronounced bounce-back,” as a result of positive changes through the RIA, such as concurrent I-485 filings, priority processing for rural cases, and new visa set-asides.
It has resulted in the EB-5 regional center industry seeing a rise in demand for EB-5 offerings, he says, particularly in rural areas, which have created a significant number of new I-956F filings to register new EB-5 projects.
“The new investment sustainment rules under the RIA may also be causing an increase in I-956F filings to secure approval for new projects with shorter return of investment timelines which would be more attractive to potential EB-5 investors,” says Tristani.
Most recently, USCIS finalized its filing fee increase schedule, which will take effect on Apr. 1, 2024. The I-956F fee is scheduled to increase 168% ($29,900) from $17,795 to $47,695, which Tristani says, “is likely causing regional centers to speed up filings before the massive fee hike.”
Sheehan believes there’s yet another important takeaway from the pending I-956Fs.
“The market is telling Congress that the market has an appetite for job creation. When given the chance to revisit the program’s efficiency in the future, legislators who see progress in their backyards need to know that the appetite is there, but it won’t last if visas are wasted and final action dates clog demand,” says Sheehan.
However, he notes that interest rates aren’t yet ideal, and with capital difficult to come by in some areas, “this program creates meaningful benefits without infusions of tax revenue into a growing debt ceiling.”
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