USCIS, IIUSA Letters Show a Failure to Communicate on EB-5!
By Mona Shah, Esq., and Rebecca S. Singh, Esq.
The year 2023 has had an eventful start (suggested fee hikes and all), with January now being punctuated by an exchange of letters between Invest in the USA (“IIUSA”) and the U.S. Citizenship and Immigration Services (“USCIS”), two organizations that seem to be at near-constant odds. They are not unlike arch-nemeses with a similar goal, but with different philosophies on how to accomplish it. This past week, they entered a new epistolary joust, sending correspondence to one another within a span of a day—a perhaps coincidental exchange, but one that suggests this year’s points of contention may soon reach a boiling point.
One thing you can say, and we are sure IIUSA would agree, about the delays informing USCIS’s business model, is that when it comes to dilly-dallying, the agency truly is consistent across the board!
Take USCIS’s January 17 letter to IIUSA, sent in response to a September request from the organization for, as IIUSA puts it, “a grace period on [EB-5 Integrity Fund] payments required under the RIA due to the lack of guidance provided by the agency.” The fund, created via the EB-5 Reform and Integrity Act of 2022 (“RIA”) for uses ranging from ensuring investor compliance to identifying fraud, is a veritable fount of financial burdens that regional centers (“RCs”) must contribute to (no doubt a fee that will eventually trickle down to all EB-5ers). These monetary albatrosses include a $3,675—slated, if USCIS gets its way, for a proposed increase to $11,160—filing fee for Form I-526E, which, as the letter states, “must include a separate payment of $1,000 as required by the RIA for all Form I-526E petitions filed on or after October 1, 2022.” RCs fare even worse: According to the letter, “USCIS must collect a $20,000 or $10,000 fee, as directed by the RIA, for the EB-5 Integrity Fund from each designated regional center.”
That is a lot of money, especially for RCs, which often are strapped for cash. An agency with competent personnel would recognize the urgency in clarifying the requirements for these entities and act swiftly to address them.
But USCIS is no such agency.
To its (minimal) credit, the letter does note that, vis-à-vis the filing fee for Form I-526E, the “additional amount does not apply to a Form I-526E amendment. There is no grace period for payment of the Form I-526E EB-5 Integrity Fund fee.” Regarding the RC fees, “USCIS anticipates publishing a Federal Register notice soon that will explain when and how the fee will need to be paid.” The letter continues: “As noted at the October 19, 2022, EB-5 National Stakeholder Engagement, USCIS will not charge a late penalty for payment of the regional center EB-5 Integrity Fund fee in 2022. USCIS will announce on uscis.gov when the Federal Register notice has been published.”
Yes, dear readers: It took four-plus months to send a letter communicating this.
There still is, as IIUSA points out, no final, official guidance for RCs on these fund contributions, but the very fact that the lag-prone agency divulged its plans to announce the publication of the Federal Register notice on the subject is at least something of a positive for RCs and other players in the EB-5 industry. Still, this cursory, ill-timed letter demonstrates that USCIS staffers still do not understand the immediate needs of the sector, and have not acted sufficiently to improve the quality and speed of their communications. Perhaps this is fodder for a future IIUSA missive; until then, the question remains: Do EB-5 practitioners really have to grin and bear it as the agency continues its slothful course?
We likely will not get any answer soon, but that has not deterred the EB-5 industry’s beloved IIUSA from asking USCIS for clarification on the oft-confusing mandates issued from the competence-challenged agency. Case in point: Only a day after USCIS sent the organization the aforementioned letter regarding EB-5 Integrity Fund payments, IIUSA sent out its latest communication, a letter asking for augmented conversations on components of the RIA. The letter does not lack IIUSA’s usual punch, but will it be strong enough to elicit viable change for the EB-5 set?
The missive—a joint effort among IIUSA, the American Immigration Lawyers Association (“AILA”), the EB-5 Investment Coalition (“EB-5IC”) and the U.S. Chamber of Commerce—aims to bolster USCIS’s relationship with these organizations in an effort to continue to foster an ongoing dialogue with the agency on issues relating to RIA. Yet some EB-5 practitioners believe the language is much too diplomatic. Indeed, the outstandingly polite expression of gratitude to USCIS for holding its Immigrant Investor Program Office (“IPO”) National Engagement on October 19, 2022, is notable for what appears to be a conciliatory approach to the concerns raised.
“It was helpful to be introduced to IPO leadership and learn directly about initiatives and priorities within the IPO,” the organizations opine in the letter, channeling the Behring decision by adding, “The point of such substantive engagement would be to avoid what the ruling judge in recent litigation against the USCIS deemed a ‘clearly erroneous’ interpretation of the RIA.” The letter goes on to state: “As the recent confusion surrounding the I-956 and I-956G filings by the end of last year showed, substantive engagement between stakeholders and USCIS in the post-RIA world is more critical now than it has ever been.” Furthermore, the letter explains that “[the] goals of such a dialogue would be to bring awareness about open interpretive questions and to engage in technical discussions examining the different possible interpretations and the impacts they would have on stakeholders.”
That’s a nice, straightforward way of saying to USCIS: “Will you please communicate with us more often about your convoluted, ever-changing requirements so everyone can be on the same page, thereby minimizing the potential for applications to be denied for ridiculous technical reasons?”
There’s a school of thought among EB-5 practitioners that IIUSA is being too soft with USCIS, given the agency’s seemingly endless obfuscating in its messaging. In the recent past, IIUSA has pointed to the need to present a moderate, not-too-strident approach to the organization’s USCIS lobbying, yet perhaps more is needed to spark action. Would it not be fair to communicate EB-5ers’ demands with regard to clarification on the RIA, as well as on problems ranging from processing delays to absurd fees, with more forcefulness? That might seem out of place when it comes to a government office that basically has a monopoly in the space, with no alternative option besides submitting to USCIS in sight. So, could this conceivably just serve to anger agency staff?
We think not. The tone of subsequent communications to USCIS need not be hostile or abrasive; rather, a judicious application of assertiveness could make a significant impact. The truth is, it has become quite obvious that USCIS needs the EB-5 industry. Without the extraordinary fees gleaned from the sector, the agency would be a lot poorer … and that is not a viable option for USCIS or those it services.
In this case, sterner letters could be the start of a less-beautiful but more actionable friendship among IIUSA, other EB-5 stakeholders, and USCIS—despite the preponderance of delays in getting there. Because if one wants something to get done, oftentimes being firm goes a lot farther than being polite.
Call it a lesson learned for both parties … if, that is, USCIS can learn anything at all.
Simon Butler and Aaron Muller also contributed to this article.