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First, the program is placed in a very weird and non-helpful administrative area for the excitement of global investment in the USA. Second, its range is all incorrect. We are handing out too much for as well tiny of a financial investment. Even more, increasing equity capital fifty percent a million bucks a tranche is, to state the least, inefficient.


The regional facilities, with their half-million systems, essentially damaged the more sensible million-dollar part of the EB-5 program. Third, such programs, if we have them whatsoever, as they perform in Australia, ought to be regarding developing organization entities, not passive investments. It needs to have to do with producing real jobs, not clarify estimations about the indirect production of tasks, which is now part of the regulations.


Probably that is just one of the reasons that it has stopped working every year to get to the legislative objective of 10,000 investment visas. Fifth, the Regional Facility Program is inherently clumsy, and the program is also filled with middlemen, both public and private. The program has more than its share of rumors, which I will certainly enter into later if anybody is interested.


This is a company that loves to say yes to applicants, yet as the table in my testimony reveals, USCIS policemans have a lot more difficulty with EB-5 applications than others. I think that is something that nobody has really discussed a lot. EB5 Regional Center Program. There are high prices of interior rejections in this program and forever factor

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Seventh, in this program visas most likely to individuals who could not obtain them differently and to individuals whose organized investment is in fact less, according to the Federal Book, than the average mean web worth of all American families in 2007. Let me increase on one of my observations.


My estimate based upon the capitalists' permit applications filed 2 years after the first financial investment-- these are the solid ones that continue to be and are approved. This is 2009-- was that they had concerning $191 million confirmed-- that is my price quote. USCIS does not provide the kind of data that we could use on this.


For every $100 of increased international financial investment that year, the EB program added one penny. Under a far more shaky analytical base, the preliminary applications of potential immigrant capitalists, USCIS is informing reporters that the level of financial investment in the just-concluded year was concerning $1.2 billion. Let us accept that.

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Thanks for listening to me. I anticipate your remarks and concerns. [The prepared statement of David North shows up as a submission for the document.] Chairman Leahy. Thank you. Our following witness is Robert Divine. He is an investor of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the firm's migration practice team.




Divine worked as Chief Advice of the United States Citizenship and Immigration Services from July 2004 until November 2006, the year in which he was Acting Supervisor, and after that Performing Deputy Director. He has worked extensively with the EB-5 program in personal method. He was chosen, as I understand, vice head of state of the Organization to Buy USA, the nationwide sector organization of local centers.


Divine, we are thrilled to have you here. Please go ahead, sir. DECLARATION OF ROBERT C. DIVINE, ATTORNEY, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE HEAD OF STATE, INVEST IN THE United States (IIUSA) Mr. Divine. Thank you, Mr. Chairman, Senator Grassley, and others. Thanks for having me.


At most, if all 10,000 slots were made use of, it would certainly be 1 percent of the migration every year to the USA. It is not near that yet, but it is expanding and obtaining toward that. Especially as USCIS, the firm that supervises the program, has actually been making the regulations more clear and the procedures more sensible and clear for individuals who are organizing investments and for the financiers that are investing, more individuals have actually agreed and able to put initiative and cash into the process to locate great jobs and establish them, and after that more investors have been eager to invest their cash and take the risk and make use of the cash to create the tasks that is the factor of the program.

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These tasks do not linger forever, and USCIS recognizes that and are attempting to speed the program, speed up the procedure - EB5 Regional Center Program. That does not mean that they are relaxing their examination, and, as a matter of fact, they are prepared to deny applications that are not qualifying. And they do so, as was discussed


The regional facility component of the program is not. It is component of an appropriations costs that was passed in 1992, and ever since that program has actually been prolonged five times for 19 years. It is time for it to be permanent, and it needs to be done currently and not nearer to the date of expiry in September.


The process takes a great while to develop a job and after that to obtain the financiers accepted. And they do not want their money streaming with up until they have been accepted. And the specter of the expiry of this Regional Center Program in September is currently preventing the growth of jobs.

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I click here wish to make clear that the Regional Center Program is not the like the half-million-dollar thing. The concept of half a million or a million is a feature of the regular EB-5 law that becomes part of the code. It simply is a reality that the majority of the local centers that are pooling financial investments have actually set those in areas of high unemployment or in rural areas where half- million-dollar financial investments are permitted, and that makes good sense.