The EB-5 INVESTOR visa program, a source of funding for construction projects such as hotels, will expire in June. The newly proposed legislation would renew and reform the project to avoid losing another line of funding for projects as the industry begins to rebound from the COVID1-19 pandemic.
the 2021 Reform and Integrity Act EB-5, sponsored by Democratic Sen. Patrick Leahy, a senior member and former chairman of the Judiciary Committee, and Republican Sen. Chuck Grassley, would reauthorize the program while improving fraud safeguards. The program was created in 1990 and provides US immigration visas to foreign investors who invest their money in local economic development projects that create jobs.
While the program has been a way for developers to fill funding gaps on some projects, it has recently faced accusations of fraud from participants on both sides of the equation, according to Grassley and Leahy.
âIt’s no secret that the EB-5 regional center program has been a mess for years. Foreign investors exploited the program to get accelerated green cards, domestic developers exploited foreign investors to quickly get money for bogus projects, and government officials chose winners and losers for political favors â Grassley said. âThis has to change. The Obama and Trump administrations have taken significant steps to restore incentives to invest in rural and truly underserved areas, but Congress must act to correct other loopholes that invite fraud and abuse. Our bill corrects many flaws in the current program and improves accountability so that it works the way Congress intended. Without these fixes, this program should not be allowed to continue. “
In 2019, former President Trump’s administration passed regulations to restore incentives for EB-5 investment in rural and economically depressed areas, members of Congress said, but not enough was done to correct the fraud and national security vulnerabilities in the program. The bill would establish new disclosure requirements for EB-5 regional centers to protect investors and to certify regional centers’ compliance with program rules. The Department of Homeland Security should also carry out regular audits and site visits to regional centers.
The EB-5 program must be allowed to continue after June, said. Cecil Staton, President and CEO of the AAHOA in a report.
âThe travel industry, and in particular the hospitality industry, can and will rebound from this COVID-19 economic crisis, but only with support; in particular, the kind of non-traditional but reliable support offered by the EB-5 Regional Center program, âStaton said.
AAHOA joined the Coalition to Save and Create Jobs which supports the adoption of Law EB-5 on Reform and Integrity.
âOn behalf of CSCJ, Invest in the USA and its leadership are pleased and grateful to AAHOA to join our efforts,â said Aaron Grau, Executive Director of IIUSA. âWe hope that with our growing list of supporters across the country, leaders of Congress will bring in the 2021 Reform and Integrity Act EB-5 before the June 30 deadline.
Since its inception, the EB-5 regional hub program has attracted more than $ 41 billion in capital investment from around the world to support American businesses and has created more than 820,000 jobs for American workers.
Last July, the United States suspended entry of workers on programs similar to the EB-5, H-1B and H-2B visa programs. These programs are designed to allow US-based companies to hire foreign workers for long-term or temporary jobs.