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First, the program is put in an extremely strange and non-helpful bureaucratic area for the excitement of international investment in the United States. Second, its range is all incorrect. We are handing out way too much for too little of an investment. Additionally, raising equity capital fifty percent a million bucks a tranche is, to say the least, inefficient.


The regional facilities, with their half-million schemes, essentially damaged the more practical million-dollar component of the EB-5 program. Third, such programs, if we have them in any way, as they do in Australia, ought to have to do with developing service entities, not easy financial investments. It should be regarding creating real jobs, not specify computations regarding the indirect creation of tasks, which is now component of the regulations.


Possibly that is just one of the reasons why it has actually stopped working every year to reach the legislative goal of 10,000 investment visas. Fifth, the Regional Center Program is inherently awkward, and the program is as well loaded with middlemen, both public and private. The program has greater than its share of rumors, which I will certainly enter later if anyone is interested.


This is a company that likes to state yes to candidates, but as the table in my statement reveals, USCIS police officers have much more problem with EB-5 applications than others. I think that is something that nobody has actually actually chatted around a lot. EB5 Regional Center Program. There are high rates of internal denials in this program and permanently reason

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Seventh, in this program visas go to people who can not obtain them differently and to individuals whose planned financial investment is really less, according to the Federal Book, than the typical mean net worth of all American families in 2007. Let me broaden on among my observations.


My estimate based upon the capitalists' environment-friendly card applications submitted 2 years after the first investment-- these are the strong ones that continue to be and are accepted. This is 2009-- was that they had concerning $191 million validated-- that is my price quote. USCIS does not offer the kind of information that we could make use of on this.


For every $100 of raised foreign investment that year, the EB program contributed one dime. Under a far more unsteady analytical base, the initial applications of potential immigrant investors, USCIS is telling journalists that the degree of financial investment in the just-concluded year was regarding $1.2 billion. Let us approve that.

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Thank you for listening to me. I look ahead to your remarks and questions. [The ready statement of David North looks like a submission for the record.] Chairman Leahy. Thank you. Our following witness is Robert Divine. He is a shareholder of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the company's immigration practice group.




Divine acted as Principal Advise of the USA Citizenship and Migration Providers from July 2004 until November 2006, view the year in which he was Acting Director, and after that Acting Replacement Director. He has worked extensively with the EB-5 program in exclusive practice. He was elected, as I comprehend, vice head of state of the Organization to Invest in U.S.A., the nationwide market association of regional centers.


STATEMENT OF ROBERT C. DIVINE, LAWYER, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE PRESIDENT, INVEST IN THE USA (IIUSA) Mr. Divine. Thank you, Mr. Chairman, Legislator Grassley, and others.


At a lot of, if all 10,000 ports were utilized, it would be 1 percent of the immigration yearly to the United States. It is not near that yet, but it is growing and getting toward that. Especially as USCIS, the firm that supervises the program, has actually been making the guidelines clearer and the procedures extra reasonable and clear for the people that are arranging financial investments and for the financiers that are spending, more individuals have agreed and able to put initiative and cash right into the process to find great tasks and establish them, and afterwards much more capitalists have wanted to spend their money and take the risk and make use of the cash to produce the work that is the point of the program.

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These tasks do not wait about forever, and USCIS recognizes that and are trying to speed up the program, speed the procedure - EB5 Regional Center Program. That does not suggest that they are my sources unwinding their analysis, and, in truth, they prepare to reject applications that are not certifying. And they do so, as was mentioned


The local center part of the program is not. It becomes part of an appropriations costs that was enacted in 1992, and ever since that program has been expanded five times for 19 years. It is time for it to be irreversible, and it requires to be done now and not nearer to the date of expiration in September.


The process takes an excellent while to develop a task and after that to helpful hints get the investors approved. And they do not desire their money flowing through up until they have actually been accepted. And the specter of the expiry of this Regional Center Program in September is currently inhibiting the development of projects.

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I want to clarify that the Regional Facility Program is not the very same as the half-million-dollar thing. The idea of half a million or a million is a feature of the routine EB-5 legislation that becomes part of the code. It just is a truth that the majority of the regional facilities that are pooling investments have actually set those instead of high joblessness or in rural areas where half- million-dollar financial investments are allowed, and that makes sense.