By Ana Durrani
For the first time since 2016, the U.S. Citizenship and Immigration Services (USCIS) has published a final rule adjusting EB-5 fees and other immigration and naturalization benefit request prices.
The final rule could enable USCIS to recover a larger portion of its operating costs and, in turn, bring quicker processing of new applications, the agency said in a statement.
“We knew fee hikes were coming, but we didn’t know when. Now we know, Apr. 1, 2024,” says Joey Barnett, partner at WR Immigration.
The update follows a price review required by law. Findings showed the current immigration fees schedule failed to meet the USCIS’ goals of recovering full costs of everything from agency operations to additional staffing requirements, among other essential investments.
USCIS Director Ur M. Jaddou noted in a statement that it was the first time in more than seven years that the USCIS increased fees “to better meet the needs of our agency, enabling us to provide more timely decisions to those we serve.”
Jaddou added that despite having years of insufficient funding, the agency’s “workforce has made great strides in customer service, backlog reduction, implementing new processes and programs, and upholding fairness, integrity, and respect for all we serve.”
Daniel B. Lundy, a partner at Klasko Immigration Law Partners, who heads the firm’s EB-5 Developer and Regional Center and Compliance practices, says he suspects USCIS’ workload forecast is inaccurate.
“Once a regional center is designated, it does not have to file an I-956 again unless there is a change, so I doubt there will be 400 being filed a year,” says Lundy. ” I think 600 is also overly optimistic for the number of project applications (I-956F) being filed each year.”
Lundy says he believes the agency may be basing its overall budget on these assumptions, meaning USCIS may have much less revenue than it expects.
“Since USCIS has a bad track record of adjudicating EB-5 applications and petitions in anything close to a timely manner, it is extraordinarily frustrating that it seems to be using EB-5 filing fees elsewhere instead of doing the right thing with EB-5 applications and petitions,” says Lundy. “The increased fees deter use of an already complicated and expensive program, and will prevent smaller projects from accessing EB-5 funds.”
What happens to EB-5 application fees?
The agency’s Frequently Asked Questions on its website provides a full list of the revised form fees that will take effect on Apr. 1, 2024. Notably, the USCIS said it will accept prior editions of most forms during a grace period between Apr. 1, 2024, and Jun.3, 2024.
It also said it will accept previous and new editions of certain forms filed with the correct fee during the grace period.
“Prospective investors should not wait to file I-526/I-526E unless they want to waste thousands of dollars,” Barnett says. “Those with I-829 filing windows open before Apr. 1, 2024, should submit the Form I-829 unless they want to waste thousands of dollars.”
For example, the current fee for the EB-5 forms I-526/I526E is $3,675 will increase to $11,160 and the price for form I-829 is $3,750 will rise to $9,525. These are some of the EB-5 application fees EB-5 investors must pay in the process.
“It is pretty clear USCIS is using EB-5 to bankroll other operations, because two I-956 or I-956 filing fees would likely pay the salary of one adjudicator for an entire year,” says Lundy. “It just isn’t plausible that an I-956, especially an amendment, or I-956F could actually cost anywhere near $48,000.”
In addition, the agency said it will use the postmark date of a filing to determine which form version and immigration fees are correct but will use the receipt date for any regulatory or statutory filing deadlines.
Lundy says with the exorbitant fee hike, EB-5 investors will rightfully expect the agency to process their petitions faster, but adds, “If history is any guide, investors are likely to be disappointed.”
Further, Lundy says the argument that EB-5 investors can afford the fee hike “is somewhat offensive given USCIS’ abysmal treatment of legacy EB-5 petitioners over many years, who currently face a published processing time of 56.5 to 86 months for an I-526 petition and 66.5 months for an I-829 petition.”
Barnett notes that the current fee increases are unrelated to the Fee Study that is required to be conducted by USCIS as part of the EB-5 Reform and Integrity Act of 2022. He says if or when the Fee Study is completed, “the EB-5 industry can likely expect even more fee increases.”
The RIA required USCIS to perform a Fee Study within a year of its enactment to calculate the cost associated with adjudicating EB-5 petitions and applications within specified time frames and to set fees to offset those costs, explains Lundy.
“USCIS claims that this study is underway, but conveniently released this fee rule and increased all EB-5 fees dramatically without the benefit of that study,” says Lundy. “In light of the implausibility of the need for such high fees to cover the cost of adjudicating EB-5 petitions and applications, one is left with one simple question — what is USCIS going to do with all the EB-5 revenue it collects?”
Other immigration fees updated by the USCIS
However, there will be no grace period for forms I-129 Petition for a Nonimmigrant Worker; I-129 CW, Petition for a CNMI-Only Nonimmigrant Transitional Worker; I-140, Immigrant Petition for Alien Workers; I-600A, Application for Advance Processing of an Orphan Petition (and supplement 1, 2 and 3); and I-600, Petition to Classify Orphan as an Immediate Relative. The USCIS said these forms still need revising with a new fee calculation, but filers can access a preview version of each new form edition before the Apr. 1 deadline.
The update follows the agency’s January 2023 notice of proposed rulemaking, through which it received more than 5,400 public comments. T the feedback from stakeholders was considered during the proposed rulemaking process, USCIS said.
The final fee rule includes reducing the USCIS’s required annual cost recovery by about $730 million and expanding fee exemptions for Special Immigrant Juveniles and victims of human trafficking, crime, and domestic violence, U.S. military service members and Afghan allies, and families pursuing international adoption.
It also gives special fee discounts to nonprofit organizations and small business employers. It allows for half-price Employment Authorization Document applications for applicants for adjustment of status and a reduced fee for adjustment of status applicants under the age of 14 in certain situations.
In addition, it expands eligibility for a 50% fee reduction for naturalization applications for individuals who can prove household income between 150% and 400% of the Federal Poverty Guidelines and establishes a standard $50 discount for online filers.
The USCIS said each fee in the final rule is the same or lower in the proposed rule. For most individual filers, the final rule will cap how much newly established fees may increase. New fees will not rise by more than 26% under the final rule, which is comparable to the increase in the Consumer Price Index since the last fee rule in 2016 was issued.
Although the agency said the fee increase would help offset overall costs, congressional funding would still be needed.
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