The Department of Homeland Security (DHS) has the authority under the Immigration
and Nationality Act (INA) to set and charge fees in association with naturalization
and immigration services. According to the act, the fees are to be structured
so as to recover the complete and full cost of the services provided.
After conducting an exhaustive review of the fee process, the agency determined
that as it stands, the current fee structure is inadequate, and increases
are warranted if the U.S. Citizenship and Immigration Services (USCIS)
is to continue providing the required level of service. The review concluded
that if the fees were to remain at their current levels, the 2016/2017
operating budget would run into deficits. The agency indicated that the
deficit could be upwards of $500 million unless the fees are increased.
So, in May, the (USCIS) proposed a rule in the Federal Register regarding
significant changes in the EB-5 fee schedule. The proposal invited public
comment for the proposed adjustments to the USCIS Fee Schedule, which
hasn’t been changed since 2010. The proposed changes will affect
the program by increasing the fees for some of the most commonly required forms.
The proposed rulemaking public comment ended on July 05, 2016, and below
is a list of the proposed changes:
- Form I-924A – Annual Certification of Regional Centers is $3,035 (New Fee)
- Form I-924 Application Filing – For new Regional Center Designation
or Amendment (including Amendment to Geographic Coverage, Project Exemplar
Application) increases from $6,230 to $17,795 (+186%)
- Form I-526 Petition Application – Increase from $1,500 to $3,675 (+145%)
- Form I-829 Petition Application – No change at $3,750
- Form I-485 Permanent Residence Application – Increase from $985 to
It appears that the proposed changes from DHS primarily affect the application
process. The new fee for Regional Centers, combined with significant fee
increases for both the I-526 and I-924 forms, more than doubles the cost
of an EB-5 application. An increase in interest in the EB-5 program has
resulted in a spike in applications. The DHS has stated that this has
led to increases costs with processing the applications and other related forms.
As the program continues to grow, the government has struggled to maintain
the proper oversight to ensure the process remains transparent, fair,
and free of fraud. To this extent, the USCIS has increased staff over
security concerns and to improve the way the overall program is managed.
Opponents of the fee increases have voiced concerns that the process is
not getting better, and there is no indication that an increase in fees
will strengthen the program. On the contrary, many feel it will bog down
the process in bureaucratic red tape and overregulation that will hinder
the program and extend EB-5 application processing times.
The sole new fee added is for the I-924A Annual Certification of Regional
Center. The form is required under current regulations to be filed annually,
confirming a Regional Center’s eligibility for the EB-5 program.
There is currently no fee to file the form and the DHS have stated in
the review that there are certain costs associated with filing the form
that are not recovered. With stricter review and oversight, DHS has made
the case that the new fee is required to cover the process associated
with managing each Regional Center and their designation. With hundreds
of Regional Centers across the country, and new centers expected to come
online this year, the USCIS claims they will have to allocate a substantial
amount of time, staff, and resources on this aspect of the program.
The public comment period for the proposed rule closed on July 5, 2016.
The DHS is currently reviewing comments, and the final rule should go
into effect in the fall of 2016. The fee hike will be applied separately
and apart from any EB-5 Visa Program legislation currently working its
way through Congress.
After the comprehensive
GAO review of the program in 2015, Democrats and Republicans are debating how much
benefit the program is providing the economy. While the GAO report focused
primarily on fraud, it also evaluated the number of jobs that the USCIS
claims was added to the economy and found that the agency’s methodology
for calculating its benefit may have been invalid. Although Congress is
considering renewing or reforming the process, it is yet to be determined
if the legislation will come to pass before the November election.
Regional Centers and companies utilizing the EB-5 investor program should
be preparing their applications and considering how the new fees will
impact their involvement, as well as that of their foreign investors.
here to read the proposed rule submitted to the Federal Register.
Contact Geraci Law Firm at (949) 298-8050 today, or contact
Kevin Kimfor more information.