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The program is positioned in an extremely weird and non-helpful bureaucratic place for the excitement of international investment in the United States. Second, its scale is all wrong. We are handing out way too much for also tiny of a financial investment. Additionally, elevating financial backing fifty percent a million bucks a tranche is, to state the least, ineffective.


The regional centers, with their half-million plans, essentially damaged the more reasonable million-dollar part of the EB-5 program. Third, such programs, if we have them in all, as they perform in Australia, need to be about producing business entities, not easy financial investments. It needs to have to do with producing genuine jobs, not elaborate calculations regarding the indirect creation of tasks, which is currently part of the regulation.


Probably that is among the reasons why it has actually failed time after time to reach the legislative objective of 10,000 financial investment visas. Fifth, the Regional Center Program is inherently clumsy, and the program is also loaded with middlemen, both public and personal. The program has greater than its share of scandals, which I will certainly get into later on if any person is interested.


This is a company that loves to say yes to applicants, but as the table in my testament shows, USCIS officers have far more problem with EB-5 applications than others. I believe that is something that no one has actually actually chatted around a lot. EB5 Regional Center Program. There are high rates of interior rejections in this program and completely reason

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Seventh, in this program visas go to individuals that can not get them any kind of other way and to people whose organized financial investment is actually much less, according to the Federal Book, than the average mean web well worth of all American family members in 2007. Let me broaden on among my monitorings.


My price quote based upon the capitalists' copyright applications filed 2 years after the initial financial investment-- these are the solid ones that continue to be and are authorized. This is 2009-- was that they had regarding $191 million validated-- that is my estimate. USCIS does not supply the kind of information that we can make use of on this.


For every $100 of enhanced international financial investment that year, the EB program contributed one dime. Under a a lot more wobbly analytical base, the preliminary applications of potential immigrant investors, USCIS is informing journalists that the degree of financial investment in the just-concluded year had to do with $1.2 billion. Let us approve that.

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Thank you for listening to me. I anticipate your remarks and inquiries. [The prepared declaration of David North shows he said up as a submission for the document.] Chairman Leahy. Thank you. Our next check witness is Robert Divine. He is an investor of Baker, Donelson, Bearman, Caldwell, and Berkowitz. He is the head of the firm's immigration technique group.




Divine offered as Chief Advice of the United States Citizenship and Immigration Services from July 2004 until November 2006, the year in which he was Acting Director, and then Performing Deputy Director. He has actually functioned extensively with the EB-5 program in exclusive technique. He was elected, as I understand, vice president of the Association to Invest in U.S.A., the national industry organization of local.


Divine, we are happy to have you here. Please proceed, sir. STATEMENT OF ROBERT C. DIVINE, ATTORNEY, BAKER, DONELSON, BEARMAN, CALDWELL, AND BERKOWITZ, P.C., CHATTANOOGA, TENNESSEE, AND VICE PRESIDENT, PURCHASE THE USA (IIUSA) Mr. Divine. Thank you, Mr. Chairman, Legislator Grassley, and others. Thanks for having me.


At many, if all 10,000 slots were used, it would be 1 percent of the migration yearly to the USA. It is not near that yet, but it is growing and getting toward that. Especially as USCIS, the agency that looks after the program, has actually been making the regulations clearer and the procedures a lot more logical and clear for individuals that are arranging financial investments and for the capitalists that are spending, more people have actually wanted and able to put initiative and money right into the process to find good tasks and develop them, and afterwards extra investors have been prepared to spend their money and take the risk and use the cash to develop the jobs that is the point of the program.

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These tasks do not wait around permanently, and USCIS recognizes that and are trying useful source to speed the program, speed up the procedure - EB5 Regional Center Program. That does not imply that they are relaxing their analysis, and, as a matter of fact, they prepare to reject applications that are not qualifying. And they do so, as was mentioned


The regional center part of the program is not. It is part of an appropriations costs that was enacted in 1992, and given that then that program has been extended five times for 19 years. It is time for it to be permanent, and it needs to be done now and not nearer to the day of expiry in September.


The process takes a great while to develop a task and after that to obtain the capitalists accepted. And they do not desire their cash moving via till they have been accepted. And the specter of the expiry of this Regional Center Program in September is currently inhibiting the growth of jobs.

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I would certainly like to clear up that the Regional Facility Program is not the very same as the half-million-dollar point. The idea of half a million or a million is a feature of the routine EB-5 legislation that belongs to the code. It just is a truth that a lot of the regional centers that are pooling financial investments have set those instead of high unemployment or in backwoods where half- million-dollar investments are permitted, which makes good sense.