TEA reform is critical to long-term reauthorization, so let’s make sure we understand different proposals
By Peter D. Joseph
As executive director of Invest In the USA (IIUSA), the national trade association for the EB-5 Regional Center Program, I have had the honor of leading the industry in government and public affairs through a period of exponential growth since the financial crisis of 2008. Since 2008, demand for EB-5 visas grew over 1,200 percent with over 40,000 immigrant investors contributing well over $20 billion of foreign direct investment (FDI) into the United States to create jobs. IIUSA’s experience in balancing economic development, financial and immigration interests has reinforced a fundamental truth: capital markets (including EB-5) must be well informed to function properly and succeed in creating economic opportunity for people. That is why education of the EB-5 industry and the public are part of IIUSA’s core responsibilities. We want all program stakeholders to succeed because EB-5 is a rare example of where everyone involved can achieve their respective goals in ways that has real public benefit.
Recently, IIUSA has focused its education and analytical efforts to reform of Targeted Employment Areas (TEA), which has long been the EB-5 policy issue with the most diversity of opinion within the industry. Over the years, various reform proposals have been introduced by congress and/or considered by industry stakeholders. Most recently, the Department of Homeland Security (DHS) proposed new EB-5 regulations that include a TEA reform. With so many different proposals, IIUSA took it upon itself to move the TEA debate out of the abstract and into the practical realities. Not only did we publish the first of its kind national report to compare how different proposals would impact the EB-5 industry that will be updated periodically, we also published interactive maps online that bring the implications to life for all to see at www.iiusa.org/tea-maps.
The report compares seven proposals with variations of New Market Tax Credit (NMTC) and Economically Distressed Area (EDA) criteria for certain geographies (which has been proposed in legislation and by industry stakeholders in some form) and “Contiguous and Adjacent” criteria (which was proposed by DHS for regulatory reform). The report is available for anyone to download on IIUSA.org and uses the most recent 5-year American Community Survey (ACS) data to analyze more than 600 EB-5 project samples to generate a comprehensive look at the impact the different policy proposals would have on the EB-5 Regional Center program at both a national and state-by-state level.
Our community’s success in building a multi-billion-dollar capital market that supports hundreds of thousands of U.S. jobs annually has been possible by working closely with professionals around the world to educate stakeholders and the public on how EB-5 has become one of the most potent economic development tools of the 21st century by delivering job-creating investment capital that create American jobs in industries such as healthcare, energy, infrastructure, education, housing, science and technology, real estate and much more.
During a time of heated rhetoric around immigration in the U.S., there remain general principles that both major political parties continue to coalesce around: increased investment in the United States and more U.S. jobs without any cost to the taxpayer. How TEAs are reformed will shape the future success of EB-5 program and its ability to continue to deliver on its purpose to create jobs and investments in all corners of our nation. IIUSA remains committed to providing the EB‐5 industry, congressional offices, and the public at large with the policy analytical tools needed to understand the practical implications of any policy proposal. We strongly believe that IIUSA's interactive online tools and comprehensive reports can help diverse interests agree to a deal before Sept. 30.
We believe in EB-5 as a tool for community and economic development globally. EB-5 is a perfect example of U.S. policy and is why it has such broad support with the U.S. at the federal, state and local level. This would not be possible without the investment by immigrant investors who understand that opportunities afforded to them and their families when investing through the EB-5 program. Let’s be successful together by educating each other and creating the global community we want through economic bridgebuilding and comprehensive analyses that have the power to ground policy debates in real terms.