Timeline for Regional Center Creation

By Ali Jahangiri

The creation of an EB-5 Regional Center under the Immigrant Investor Pilot Program can be accomplished by any commercial business entity in the United States. No special license is needed to create a regional center and there are various advantages to EB-5 investment through a designated regional center. For example, regional centers are subject to more lenient job creation requirements and can count indirect jobs towards the number of full-time jobs created by the EB-5 investment.

EB-5 Regional Centers are designated and approved by United States Citizenship and Immigration Services (USCIS). The following is a timeline and description of the steps needed to create a Regional Center.

  1. Define the Scope of the Regional Center

    Regional Center Creation Timeline

    You must decide both the economic and the geographic scope of the regional center. The details to be determined include the industry, location, business model, required investment amount and the amount of total capital needed for the project. This step requires working with an EB-5 team, as outlined below, to get a better understanding of what best fits your needs.

  2. Hire an EB-5 Team

    A critical step in the creation of the regional center is the hiring of industry experts to begin working on the individual requirements necessary for approval of the regional center. Depending on who you know in the EB-5 industry, this could take anywhere from one week to one month. Also, choosing the right service provider is like choosing the right doctor; so be particular with who you select. The directories on EB5Investors.com are a good place to begin your search; we have many service providers in these categories.

    • Immigration attorney: The immigration attorney begins the designation application with USCIS, known as the I-924 application.

    • Corporate & securities attorney: A securities attorney will ensure that the investment is compliant with the regulations of the U.S. Securities and Exchange Commission (SEC) and that the investments are structured properly.

    • Business plan writer: The business plan writer produces the business plan. This business plan must be compliant with Matter of Ho. This is filed with your application. If you already have a business plan written, this expedites the process.

    • Economist: The economist will create the economic job forecast for your application by taking into consideration what type of business you are proposing to create and the specific areas you are designating in your regional center application. The economist plays a big role in the application process. Finally, the economist may also help you determine if the regional center is to be located in a targeted employment area, or TEA. TEA designation lowers the required investment from $1 million to $500,000 for each investor and is handled by each individual state1. A TEA is defined as a rural area or an area of high unemployment (equal to at least 150% of the national average).

    The economist will also prepare a calculation/job creation report.

  3. File the I-924 Application to Establish a Regional Center

    This process will take about one to three months. In order to have a complete application, you need to have the business plan and economic plan in place. Once these are ready, the attorney who is quarterbacking this process can file the I-924 application. The I-924 application2 for regional center designation must be filed with USCIS.

    Once the application is approved, the regional center may begin to receive EB-5 capital for EB-5 projects. The approval process is currently taking about 14 months.

    The I-924 is typically filed by an immigration attorney, but other types of attorneys occasionally file these forms.

    There are various pieces of evidence that are required within the I-924 application. Although they may vary depending upon the specific application, in general they include:

    • Proof that the regional center will create 10 full-time jobs for each EB-5 investor. Forms of evidence include:

      • A business plan,

      • An economic report,

      • SEC/offering documents, including subscription agreement, private placement memorandum and due diligence questionnaires/accredited investor questionnaires,

      • LP or LLC agreement for the EB-5 vehicle, and

      • Pro formas demonstrating how the funds will be spent/financial projections.

    • Proof that the regional center will remain compliant with the regulations of the EB-5 program. Forms of evidence include:

      • Articles of incorporation,

      • Escrow agreement, and

      • Drafts of investment agreements, contracts, investment offering letter, memorandums or agreements made with organizations that are going to engage in activities on behalf of the regional center.

    The above documentation shows the business structure of the regional center and the enterprises that will be associated with it.

    • A detailed account of the proposed promotional activities of the regional center. Forms of evidence include:

      • Evidence of funds allocated to promotional activities,

      • Budgets for promotional activities,

      • Description of how the regional center will ensure that the investments are from lawful sources, and

      • An operational and marketing plan of how the regional center will attract its investors.

    • A map of the geographic location of where the regional center will be located.

    Note that USCIS may or may not request additional information and there is a $6,230 filing fee for the I-924.

1Thus, timing of the TEA designation varies by state.

2The I-924 application may also be filed by existing regional centers wishing to amend their designation, obtain project pre-approval or seek exemplar. Amendments may include changes to geographic area, organizational structure, NAICS code designation/business plans.

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