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USCIS fee changes, effective December 23, 2016

Shocked

The Department of Homeland Security (DHS) has published a final rule adjusting the fee schedule for many immigration applications and petitions processed by US Citizenship and Immigration Services (USCIS). The new fee schedule will become effective on December 23, 2016. Applications and petitions postmarked or filed on or after that date must include the new fees.

As determined by DHS, adjusting the fee schedule is necessary to fully recover costs and maintain adequate service. This is the first adjustment in the last six years.

Under this final rule, DHS will increase fees by a weighted average of 21 percent; establish a new fee of $3,035, covering USCIS costs related to processing the employment-based immigrant visa, fifth preference (EB-5) Annual Certification of Regional Center, Form I-924A; establish a three-level fee for the Application for Naturalization, Form N-400; and remove regulatory provisions that prevent USCIS from rejecting an immigration or naturalization benefit request paid with a dishonored check or lacking the required biometric services fee until the remitter has been provided an opportunity to correct the deficient payment.

While the fees for some petitions will remain the same, others will see significant increases. The highest increases are for the visas used by American businesses to bring skilled workers to the United States, immigrant investors creating jobs for Americans and immigrants acknowledged to have extraordinary ability.

The new fee schedule includes increased fee for the Form I-129 to $460 from $325. Form I-129 used for the most common work visas, including H-1B professional, O-1 extraordinary ability, and L-1 intracompany transfer visas, as well as E-1 treaty trader, E-2 treaty investor and E-3/FTA H-1B1/TN treaty professional visas processed in the United States rather than at an American consular post or preflight inspection unit abroad.

Fees for the Form I-140 used for EB-1, EB-2 and EB-3 employment-based immigrant visas were increased to $700 from $580.

One of the highest increases is for the Form I-526 required for an EB-5 immigrant investor creating at least ten jobs for American workers. Form I-526 fee was increased to an outrageous $3,675 from $1,500.

Family-based immigration fees are better, with only a 27 percent increase, to $535 from $420, for the Form I-130 used by US citizens and lawful permanent residents to sponsor certain close relatives to immigrate. The Form I-485 required for immigrants who process through the USCIS instead of an American consular post abroad was increased only slightly, to $1,140 from $985.

For a full list of the new fees please visit the USCIS website.

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USCIS fee changes, effective December 23, 2016

US green card availability to increase beginning October 1

visa-perm

Effective October 1, 2016, green cards will become more readily available for most people immigrating to the United States on employment-based (EB) immigrant visa categories.

The US State Department announced in the October 2016 edition of its Visa Bulletin that the agency is processing requests under the EB1 category for all countries of birth, effective October 1. This category includes aliens of extraordinary ability, outstanding professors and researchers, and multinational managers and executives, regardless of place of birth. During the summer, the agency reported a lengthy backlog for EB1 immigrants born in mainland China and India.

The EB2 category—for professionals with an advanced degree and aliens of exceptional ability—is also immediately available, except for individuals born in mainland China and India, for whom the category is backlogged to February 15, 2012, and January 15, 2007, respectively.

The EB3 category—for professionals and skilled workers—has limited available for all places of birth. That said, the backlog for most places is to June 1, 2016, and it is not likely to slow the process of immigration, since the Department of Labor generally takes more than four months to grant the alien employment certification application, often referred to as PERM, longer and that is a prerequisite for EB3 immigration.

The EB5 category—for investors—is currently available for all places of birth except mainland China, which continues to be where the majority of EB5 immigrants are born. EB5 is unavailable for China-born investors in projects in Regional Centers, while EB5 is available to China-born investors in non-Regional Center projects who have I-526 immigrant petition receipt dates on or before February 22, 2014.

There is an annual limited supply of immigrant visas in all EB categories that is replenished effective October 1, the first day of the new fiscal year. In categories where the annual demand tends to be greater than the limited supply, the Visa Bulletins issued for October through April often show the most movement. There is often more movement in the dates for individuals born in mainland China and India during these months. The EB1 and EB5 dates that have improved so much since the September 2016 Visa Bulletin are likely to retrogress once again later in the fiscal year, but the State Department did not release a prediction as to when or by how much.

The full text of the October 2016 Visa Bulletin can be found here.

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US green card availability to increase beginning October 1

US government immigration fee increase proposed

Rising Prices ahead

On May 4, 2016, the US Citizenship and Immigration Service (USCIS) published notice of a proposal to increase certain government filing fees and create a new fee. The average increase is 21 percent, but the highest increases are for the visas used by American businesses to bring skilled workers to the United States, immigrant investors creating jobs for Americans and immigrants acknowledged to have extraordinary ability.

A 42 percent increase is proposed for the Form I-129 used for the most common work visas, including H-1B professional, O-1 extraordinary ability, and L-1 intracompany transfer visas, as well as E-1 treaty trader, E-2 treaty investor and E-3/FTA H-1B1/TN treaty professional visas processed in the United States rather than at an American consular post or Preflight Inspection Unit abroad. A 42 percent increase is also proposed for the Form I-140 used for EB1, EB2 and EB3 employment-based immigrant visas.

If 42 percent seems outrageous, the increase proposed for the Form I-526 required for an EB5 immigrant investor creating at least 10 jobs for American workers is 145 percent.

Family-based immigration fares better, with only a 27 percent increase proposed for the Form I-130 used by United States citizens and lawful permanent residents to sponsor certain close relatives to immigrate. The Form I-485 required for immigrants who process through the USCIS instead of an American consular post abroad is proposed to increase only 16 percent.

The USCIS explains that the fee increases are required to recover costs for their services and to maintain adequate service. Current service is far from adequate. Although Congress mandated USCIS processing timelines in the American Competitiveness of the 21st Century Act of 2000 (AC21), almost 16 years later the agency continues to consistently fail to meet the standards set by law.

AC21 set 30-day processing times for most employer-sponsored nonimmigrant visas and 180-day processing times for most employer-sponsored immigration. Processing times tend to be at least twice as long or worse. Instead of 30 days, five months is the processing time currently reported for Form I-129 H-1B visa extensions, for example, and the USCIS California Service Center reported that as of February 29, 2016, the agency was currently processing Form I-485 immigrant applications received before May 17, 2014!

The agency has not increased fees in many years. Proposed fee increases usually become final fee increases without significant, if any, change—most likely later this summer.

There is a 60-day comment period. Guidance on how to submit comments is in the notice. The full text of the USCIS notice can be found online at the Federal Register.

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US government immigration fee increase proposed

EB-5 China backlog

Now later

The United States State Department announced in the May 2015 Visa Bulletin that conditional resident status based on the EB-5 immigrant investor visa is currently available only to individuals born in China whose I-526 immigrant petitions were received on or before May 1, 2013.  EB-5 remains immediately available to immigrants born in all other countries.  Further, this backlog does not impact pending I-526 and I-829 petitions, regardless of country of birth.

The fiscal year begins on October 1.  According to the State Department’s Visa Control and Reporting Division Chief, 2,525 EB-5 visas remain available this fiscal year to people born in all countries other than China.  China has already used 6,819  or 88.56% of the EB-5 allotment for this fiscal year.  Vietnam is the second largest user this year, with a mere 244 EB-5 visas, followed by Taiwan, India and South Korea.  The State Department anticipates that the other countries will not use up all of the remaining EB-5 visas and estimates about 1,000 more EB-5 visas will be released to immigrants from China before the current fiscal year ends on September 30, 2015.

EB-5 immigrants from all countries can continue to file and obtain approval of I-526 immigrant petitions.  In fact, filing the I-526 as early as possible is more important than ever, since it is the I-526 receipt, also known as the priority date, that is ultimately used for quota purposes.  Approximately 10,000 new EB-5 visas will become available on October 1, 2015, when the new fiscal year begins.

For more information, check out the May 2015 Visa Bulletin.

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EB-5 China backlog

Much ado about nothing

Work work work

On March 24, 2015, the Department of Homeland Security’s (DHS) Office of the Inspector General (OIG) issued a report critical of former Citizenship and Immigration Services (USCIS) Director and current DHS Assistant Secretary Alejandro Mayorkas’ handling of the EB5 immigrant investor visa program entitled “Investigation into Employee Complaints about Management of U.S. Citizenship and Immigration Services’ EB-5 Program. ”

One would be forgiven for thinking that a great problem with the EB5 program was revealed that needed immediate attention, from some politician press releases and reports from certain news services that seem to have only read these releases and not the 97 page report.

Not true.  Here is what the report concludes:

Mr. Mayorkas’ actions in these matters created a perception within the EB-5 program that certain individuals had special access and would receive special consideration. It also lowered the morale of those involved.

No finding of special access or special consideration, only “created a perception” of this to some USCIS staff who reported that “lowered the morale of those involved.”  I can already predict how John Oliver of Last Week Tonight will lampoon the government for these revelations.

To put this into context, former Director Mayorkas led the USCIS in 2013 when the DHS OIG issued an earlier report recommending that the agency and Congress make a number of changes to the way the EB5 program was handled.  That report is available at the DHS OIG web site.

Mr. Mayorkas led the implementation of those changes, which resulted in the creation of the Immigrant Investor Program Office (IPO) and major changes to the USCIS employees responsible for administering the program, including hiring new staff trained in securities law, fraud detection, and economics, and relocation of the office from California to Washington, which resulted in additional staff changes.  Further, he brought in Nicholas Colucci, then Associate Director at FinCEN – the Financial Crimes Enforcement Network, which is the anti-money laundering regulator for US financial institutions – to serve as IPO Chief instead of promoting from within.

That feathers were ruffled for a small group of 15 miffed USCIS employees comes as no surprise. As the President of the American Immigration Lawyers said in response to the report:

But when have you ever heard of a large organization in which everyone wholeheartedly embraced changes to the way things have “always been done”? Mr. Mayorkas was responsible for leading an agency with some 15,000 employees in 200 offices across the world. The EB-5 program was just one of dozens of programs led by Mayorkas, with many of them troubled by some of the problems that have plagued EB-5. All too often its decisions failed to meet the “fundamental threshold for rational decisionmaking,” in the words of one federal judge overruling a decision denying a visa petition.

The EB5 program creates jobs for American workers, most often in areas targeted for rates of unemployment 150 percent or more above the national average.  For every 10 fulltime-equivalent jobs for American citizens and lawful residents created, an EB5 immigrant makes a minimum $500,000 investment and sometimes more than twice that amount.

USCIS processing of EB-5 cases is slow, very slow.  Slower than any other immigrant visa petition handled by the agency.  While the USCIS processes most petitions within four to five months and even offers a 15-day premium processing service for many, EB-5 petitions on the average languish for three times as long or longer before an officer is assigned and begins work.  And that is just the first step of the multiyear process to obtain permanent resident status, with an immigrant’s invested funds committed to and at risk in the American investment during the entire period, often five years.  It is this slow agency processing that jeopardizes the EB-5 program more than anything else.  Leadership to improve the speed at which USCIS staff work should be encouraged even if it also lowers morale.

Congressional action is needed.  The pilot program portion of the EB-5 program expires September 30, 2015, as it has every three years since enactment.  Every three years, Congress waits until the last minute and then votes to renew the program for another three years, sometimes taking action only after the program expires.  Every three years this creates uncertainty for the American workers whose jobs are created by the EB-5 program, the American businesses that rely on the EB-5 immigrant investors for financing, and the immigrant investors themselves who rely on the EB-5 program to create a new home for their families in the United States.  Congress needs to act quickly to renew the program and not jeopardize this important tool for American job creation.

The full text of the report is available at the DHS OIG web site.

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Much ado about nothing

EB5 Escrow FAQ

Money sign

The employment-based, fifth preference immigrant visa (EB5) is an increasingly popular way for foreign nationals to immigrate to the United States by making a business investment that creates jobs for American workers.  EB5 is also an important source of business investment for local governments and entrepreneurs in search of funding for business development.  Lengthy processing times by US government agencies and the types of escrow terms used on many projects have delayed the creation of jobs for American workers, and increased the likelihood of denial of the EB5.  Now is the time to better understand and re-evaluate the EB5 escrow.

Here is a list of frequently asked questions regarding EB5 escrow intended to help Regional Centers, developers, and foreign investors to better understand how use of an escrow can hurt the chances of getting conditional residence and getting the condition removed two years later for the permanent residence.

Frequently Asked Questions – EB5 Escrow

What are escrow provisions for EB5?

For those EB5 projects that have escrow provisions, the escrow typically works as follows:

First, each immigrant’s funds are held by a financial institution and are not directly received by the new commercial enterprise (NCE) in which the immigrant invested.  The funds remain there and cannot be accessed by the NCE to create the jobs for American investors required for EB5.

Second, the immigrant’s investment funds are released to the NCE only after the US Citizenship and Immigration Services agency (USCIS) finally completes its long, slow process to make a final decision on the Form I-526 immigrant petition.

This process is repeated for each individual immigrant.  The result is that funds trickle into the NCE slowly.  USCIS processing times vary, but are always very slow. The USCIS web site reports an average processing time of 13.4 months as of June 30, 2014, but that only reflects how long it takes before the agency begins to work on a petition.  The USCIS also reports that investor petitions awaiting adjudication are at an all-time high.  Requests for Further Evidence (RFE) are very common and the time it takes for the agency to prepare the RFE, for the immigrant to prepare a response to the RFE, and for the USCIS to then make a final decision often means the I-526 approval often takes 2 years.  If funds are held in escrow during that time, then the funds are unavailable to create the jobs and the project is delayed for all investors.

There are many reasons why an RFE may be issued, but one of the most common is because the USCIS wants further documentation to show how the funds will be used to create the required jobs.  In cases where the funds are immediately available and job creation starts sooner, it is easier to minimize the risk of an RFE and to successfully respond to an RFE by showing how the funds are already being used to create jobs.  In contrast, the USCIS has delayed/denied I-526s where a business plan timeline is substantially delayed, even though the delay is a result of funds being held in escrow longer than intended due to slow USCIS processing times.

Does US law require escrow provisions for EB5?

No.

The USCIS regulation 8 Code of Federal Regulations Section 204.6(j)(2) requires documentation that the required amount of capital be placed at risk and actually committed to the NCE.  There is no endorsement or requirement of escrow provisions in the statute or regulations.

Can escrow provisions hurt the chances of obtaining approval of the conditional or permanent green card?

Yes.

Escrow provisions delay the release of funds that NCEs need to create the jobs for American workers that are required for EB5 success.  Ten new, full-time equivalent jobs for American workers are generally required to be created for each immigrant.

These jobs must be created before (or reasonably soon thereafter) the USCIS will grant the Form I-829 petition for the removal of the conditional residence and approve permanent residence.  If all ten jobs are already created before the I-829 is filed, then the petition is much easier and faster for the USCIS to approve.  If a delayed release of funds slows the required job creation, then the USCIS is more likely to deny the I-829 and then resident status can be lost.

Can escrow provisions be waived?

Yes.

An immigrant can waive escrow provisions and authorize the escrow agent to release funds to the NCE at any time. The NCE can then apply the funds to the required job creation activities and issue documentation faster.  The documentation can then be submitted in support of the I-526 when it is filed, used to supplement an I-526 already pending and/or used to better respond to an RFE.

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EB5 Escrow FAQ