As mandated by the EB-5 Reform and Integrity Act of 2022, the Department of Homeland Security has published a notice in the Federal Register informing EB-5 stakeholders that the USCIS, the process of gathering funds for the EB-5 Integrity Fund, which will be responsible for managing the EB-5 Regional Center Program, will commence soon.
Beginning on March 2, 2023, the USCIS will charge each designated regional center an annual fee to fund the EB-5 Integrity Fund. The annual fee, due by April 1, 2023, for the current year, is $10,000 for EB-5 regional centers with fewer than 20 investors and $20,000 for regional centers with more than 20 investors. The fee may be paid online through Pay.gov, which is administered by the United States Department of the Treasury.
EB-5 Regional Centers Will Be Obligated to Pay a Fee of Up to $20,000 to USCIS In April
Beginning with the fiscal year 2024, the fee will be due between October 1 and October 31 at the beginning of each fiscal year (starting Oct. 1-31, 2023).
USCIS has determined to charge regional centers an "Integrity Fee" of $20,000 (or $10,000 for those with 20 or fewer investors), in addition to all other fees.
On October 1, 2022, the filing fee for Form I-526E, Immigrant Petition by Regional Center Investor, increased by $1,000 to include Integrity Fund fees.
Moreover, there has been a recent $1,000 surge in filing fees for the I-526E and a proposed significant hike in filing fees for visa applicants. Worse, adjudication times are getting longer and longer despite all the fees collected, which makes one wonder where all this money goes.
The alert stated that the agency could use EB-5 Integrity Fund fees to detect and investigate immigration fraud and other crimes. There will be no late fees assessed for payments due in FY2023. However, beginning in October 2023, the agency will begin charging late fees for payments that are more than 30 days late. Soon, the agency will announce the amount of the late penalty and the procedure for collecting it.
Failure to Pay the Fee Could Result in the Termination of EB-5 Regional Centers
In regard to the termination of regional centers, the USCIS states that, per RIA law, they are required to terminate any regional center that fails to pay the fee within 90 days of when it is due.
If a regional center intends to retire or cease operations, would it still have to pay this fee, or will it be waived upon termination? It is likely what they are seeking. Wolfsdorf asserts that USCIS must figure this out before imposing such fees without notice and opportunity for public comment.
According to the alert, before sending a notice of termination, the agency will send a notice of intent to terminate and an opportunity to provide evidence that the fee was paid on time.
Marko Issever, chief executive officer for America EB 5 Visa, LLC, does not believe the collection of the fee will discourage the submission of new EB-5 applications. According to him, however, the most common complaint from investors that his company receives is about the lengthy processing times and increased scrutiny of the source of funds.
The USCIS does not have enough personnel to handle the current backlog. In addition, the RIA mandates much quicker adjudications. Since these fees cannot be redirected to other pressing issues, they must find a way to clear the backlog, according to Issever.
To address this issue, the USCIS could free up some staff by eliminating the requirement for licensed US broker-dealers to file Form I-956K.
Many members of the EB-5 community believe that the agency's staffing issues have prevented it from doing more, although the RIA law increased supervision requirements.
The least USCIS could do to reduce their workload would be to require Form I-956K to be filed only by unregulated foreign migration agents and exempt US broker-dealers, according to Issever. The freed talent could then be applied to other pressing issues.
Note: This website's content is meant to be general; it does not constitute legal or financial advice. Only a licensed expert with a total understanding of all the information and circumstances of your specific situation can provide legal or financial advice. Before enrolling in the EB-5 program, you should contact a visa attorney with legal, immigration, and financial knowledge.