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Initially, the program is placed in a really weird and non-helpful administrative place for the stimulation of international investment in the USA. Second, its range is all wrong. We are handing out excessive for as well tiny of an investment. Additionally, raising equity capital fifty percent a million dollars a tranche is, to state the least, inefficient.


The local centers, with their half-million schemes, basically undercut the more sensible million-dollar component of the EB-5 program. Third, such programs, if we have them whatsoever, as they do in Australia, should have to do with producing service entities, not passive investments. It should be regarding producing real work, not clarify calculations concerning the indirect production of tasks, which is currently part of the legislation.


Possibly that is among the reasons why it has failed time after time to reach the legislative goal of 10,000 financial investment visas. Fifth, the Regional Center Program is naturally clumsy, and the program is as well loaded with middlemen, both public and private. The program has even more than its share of scandals, which I will certainly enter later if anybody is interested.


This is a firm that enjoys to say yes to applicants, however as the table in my testimony shows, USCIS police officers have a lot extra trouble with EB-5 applications than others. I think that is something that nobody has truly spoken about a lot. EB5 Regional Center Program. There are high rates of internal rejections in this program and permanently factor

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Seventh, in this program visas go to people who could not get them otherwise and to individuals whose organized investment is in fact much less, according to the Federal Reserve, than the ordinary mean total assets of all American families in 2007. Allow me increase on among my observations.


My estimate based upon the financiers' permit applications filed 2 years after the initial financial investment-- these are the strong ones that remain and are accepted. This is 2009-- was that they had about $191 million validated-- that is my price quote. USCIS does not give the type of information that we could utilize on this.


So for each $100 of boosted foreign financial investment that year, the EB program added one dime. Under a much more wobbly analytical base, the first applications of would-be immigrant financiers, USCIS is informing reporters that the degree of investment in the just-concluded year had to do with $1.2 billion. Allow us accept that.

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Thank you for listening to me. I anticipate your comments and inquiries. [The ready declaration of David North looks like a submission for the document.] Chairman Leahy. Thanks. Our next witness is Robert Divine. He is an investor of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the firm's migration technique team.




Divine functioned as Chief Advise of the United States Citizenship and Immigration Solutions from July 2004 until November 2006, the year in which he was Acting Supervisor, and afterwards Performing Deputy Supervisor. He has actually worked extensively with the EB-5 program in private method. He was chosen, as I recognize, vice president of the Association to Spend in U.S.A., the national sector association of regional.


Divine, we are happy to have you below. Please go on, sir. STATEMENT OF ROBERT C. DIVINE, ATTORNEY, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE HEAD OF STATE, PURCHASE THE USA (IIUSA) Mr. Divine. Thanks, Mr. Chairman, Legislator Grassley, and others. Thank you for having me.


At more info most, if all 10,000 slots were used, it would be 1 percent of the migration annually to the United States. It is not near that yet, however it is growing and obtaining towards that. Specifically as USCIS, the company that manages the program, has been making the guidelines clearer and the processes much more sensible and clear for individuals that are arranging financial investments and for the capitalists that are investing, even more people have actually been willing and able to place initiative and cash right into the procedure to find excellent projects and develop them, and after that more capitalists have wanted to spend their cash and take the risk and use the cash to develop the work that is the point of the program.

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These jobs do not wait around permanently, and USCIS understands that and are trying to speed the program, speed up the process - EB5 Regional Center Program. That does not imply that they are unwinding their analysis, and, in truth, they prepare to reject applications that are not qualifying. And they do so, as was discussed


The regional facility component of the program is not. It belongs to an appropriations expense that was enacted in 1992, and since then that program has actually been extended 5 times for 19 years. It is time for it to be irreversible, and it requires to be done now and not nearer to the day of expiry in September.


The process takes an excellent while to develop a project and after that to obtain the investors accepted. And they do not desire their money moving with until they have actually been accepted. And the specter of the expiration of this Regional Facility Program in September is already discouraging the advancement of projects.

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I would love to make clear that the Regional Facility Program is not the exact same as the half-million-dollar thing. The concept of half a million or a million is a feature of the normal EB-5 regulation that is part of the code. It simply is a truth that the majority of the local facilities that are pooling investments have established those instead of high joblessness or in backwoods where half- million-dollar investments are allowed, which makes good sense.