As deadline nears, EB-5 bills start hitting lobbyists inboxes Update of Sen. Grassley’s and Sen. Leahy’s 2016 proposal is making the rounds
From left: Sen. Patrick Leahy and Sen. Chuck Grassley
After months of close to no action, senators are finally updating their proposed reforms to the controversial EB-5 investor visa program and circulating draft legislation ahead of an April 28 expiration date. On Tuesday, the offices of Sen. Patrick Leahy (D-VT) and Sen. Chuck Grassley (R-IA), two of the EB-5 investor visas loudest voices for reform, began shopping a tweaked draft of a bill they introduced in the previous Congress.
Though still far away from where much of the real estate industry stands on EB-5, it does include some provisions that reflect changes that real estate lobbyists have said they could live with. Although the Department of Homeland Security under President Obama set forth a proposal to raise the minimum invest for a visa from $500,000 up to $1.35 million, Grassley and Leahy’s current legislative proposal would would usher in an $800,000 minimum.
That’s likely an acceptable figure for many EB-5 stakeholders: In a March 8 hearing in the House Judiciary Committee, Angelique Brunner, the president of EB5 Capital and EB-5 Investment Coalition s spokesperson, said she was hoping to see legislation that would result in a minimum much lower than $1.35 million and more in the neighborhood of $1 million. She previously said that the Obama-recommended minimum of $1.35 million would “kill the program.”
The bill also includes integrity measures that appear universally well received, such as requiring routine audits of regional investment centers to check for compliance with SEC regulations.
“The industry is viewing this as an offering of some type,” said Holland Knight lobbyist Ron Klein, who represents EB-5 clients like the US Immigration Fund. “This is their attempt to put something in front of everybody and ‘say let’s get back to work on this,’” Klein said, “but there are still some very substantial issues to be resolved here.”
Key issues the real estate industry is still waiting to debate include how the effective date爱上海同城论坛 s of any new reforms will be put in place, as they have the potential to rock deals already in progress, damaging project finances. There are also significant disagreements on the designation of Target Employment Areas (TEAs), in which foreigners must invest to qualify for the lowest possible investment amount, currently just $500,000 and $800,000 under Leahy and Grassley s proposal.
The proposal could change how TEAs are drawn and wrestle control away from the states, making TEAs conform with census tract criteria. Some in the real estate industry argue this is shortsighted, and that census-guided TEAs are a poor standard for measuring whether projects are impacting underserved communities.
The bill would further mandate that some EB-5 visas be reserved exclusively for rural 新上海贵族宝贝论坛 projects, which could mean the backlog fo[……]