Pursuant to the Immigration and Nationality Act (INA) § 286(m), 8
U.S.C. 1356(m), the Department of Homeland Security (DHS) retains express
authority to set fees for immigration adjudication and naturalization
services at a sufficient amount to “ensure recovery of the full
costs of providing all such services, including the costs of similar services
provided without charge to asylum applicants or other immigrants.”
The capital generated by these surcharges serves as the primary source
of funding for the U.S. Citizenship and Immigration Services (USCIS),
which utilizes the fees to cover expenditures related to processing immigration
In 2015, USCIS executed a comprehensive internal fee review and concluded
that the existing fee schedule provides insufficient revenue to fully
recover the annual operational expenses for EB-5 services performed by
the agency. The USCIS calculated its FY 2016/2017 total operating cost
would significantly exceed overall projected revenue; thus, if USCIS maintains
the current operational fee levels, it will experience an estimated $560
Recognizing the apparent necessity to adjust the current fee schedule to
recover the total base cost of filing EB-5 immigration requests, along
with further expenditures needed to improve the process for increased
applications, the DHS published a notice of proposed rulemaking in the
Federal Register on May 4, 2016. They provided an invitation for public
comment on a proposed adjustment in the USCIS Fee Schedule that had not
been updated since Nov. 23, 2010. If passed, the DHS proposal would increase
USCIS fees by a cumulative weighted average of 21 percent, with a far
greater percentage increase for EB-5 applications specifically.
Under the DHS’ proposed rule, EB-5 program applications are subjected
to excessive fee increases as compared to other programs. The rule would
implement both new fees in addition to fee bumps of more than 100 percent
for Forms I-526, Immigrant Petition by Alien Entrepreneur (from $1,500
to $3,675), and I-924, Application for Regional Center Designation Under
the Immigrant Investor Program (from $6,230 to $17,795).
Following the establishment of the Immigrant Investor Program Office (IIPO)
at USCIS in 2012, agency records indicate a significant increase in workload,
with USCIS receiving a total of 412 Form I-924 Applications for Regional
Center Designation in the thirteen-month window between Aug. 1, 2014,
to Aug. 31, 2015. As a result, staffing needs have increased to maintain
regulatory compliance, manage operational efforts, and ensure identification
of fraudulent activity, national security threats, and public safety concerns
related to the program.
Furthermore, the DHS claims that USCIS intends to conduct more site visits
to regional centers and commercial enterprise partners to authenticate
data provided in the regional applications and investor petitions. However,
the DHS proposal does not include a guarantee for more efficient processing
times or improved services as a result of the proposed fee hikes.
Additionally, the proposed rule would implement a new fee of $3,035 for
filing the EB-5 Form I-924A (Annual Certification of Regional Center),
which is an annual filing requirement for all approved EB-5 regional centers
to demonstrate ongoing eligibility as designating processing locations.
Despite the fact regional centers are required to file Form I-924A on
an annual basis, there is no current fee specifically earmarked for the
procedural requirement, and the DHS does not recover the processing costs
related to these filings.
The proposed rule justifies the new fee by claiming significant expenditures
incurred by the USCIS to review Form I-924A applications and administer
the expanding EB-5 regional center program that has added 460 new centers
since the end of FY 2013. Further increasing expected costs, the USCIS
plans a comprehensive regulatory revision of Form I-924A to include a
new segment enabling regional centers to independently withdraw their
designation and discontinue participation in the EB-5 program.
The window for public commentary on the DHS’ proposed rule officially
closed on July 5, 2016. If adopted, the rule would take effect sometime
in the fall of 2016. Clients currently considering creating or expanding
an EB-5 regional center, or planning to submit an EB-5 investment as an
alien entrepreneur should consider completing the process as soon as possible
to avoid these potentially increased filing fees.
Efforts to reform the EB-5 visa program have stalled in Congress, with
legislators instead choosing to continue funding the program until April
28, 2017, without any fundamental changes. The continuing resolution was
passed despite efforts from some lawmakers to add greater oversight to
a program that has seen its share of fraud. Senator Patrick Leahy, D-Vt,
has pushed reform legislation with others in Congress, saying, “Almost
everyone agrees it is broken. It is time we fix it. If EB-5 cannot be
reformed due to a paralysis of leadership, the time has come for it to
end, not be extended, without debate, in a continuing resolution.”
President Trump has already issued orders to reexamine the viability of
the H1B visa program that allows businesses to bring in skilled foreign
workers to fill vacant U.S. jobs. It remains to be seen how the incoming
administration will address the growing fraud issues seemingly permeating
throughout EB-5 projects, and when they will begin their review of the
continued feasibility and integrity of the program.
Kevin Kim for more information.