MORE ON SHOVEL READY EB-5 EXEMPLARS

In my last blog, I wrote about the section in the proposed regional center (“RC”) extension bill, S. 1501, that permits filing an exemplar application to lock in the $900,000 investment amount and TEA.

It is unclear under S. 1501 whether the project must be “shovel ready” for an exemplar. S. 1501, as drafted, does not refer to “shovel ready”, but says a “general” business plan and security documents are needed. Since the USCIS says they will give “deference” to the project after the exemplar is approved, I believe they will want considerable evidence to show it is about ready to proceed. To be on the safe side, many are assuming this exemplar concept provision for the investment amount and TEA will be in the new law and are preparing exemplar filings.

Today, exemplars have a few advantages. First, all issues should be decided together rather than the USCIS issuing different Requests for Evidence for various I-526s filed by the investors.

Second, an exemplar allows the RC to deal directly with the USCIS to resolve any issues. And, if needed, it gives the RC standing in court if litigation is needed.

Third, when granted, USCIS says they decide the I-526s on file for the project. The average I-526 processing time is 14 months. The average exemplar processing time is about 10 months. (Many cases take longer.) Thus, if the exemplar is granted in 10 months, this can speed up the I-526 processing. But, USCIS will also hold the I-526s until the exemplar is decided.

EB5 RC EXTENSION STATUTE RUMORS:

Some are speculating that S. 1501 proposed by Senators Grassley and Leahy is too big a bite to swallow. There are rumors that opposition to S. 1501 will mean the current regional center statute may be extended for three months or one year. The S. 1501 bill must be taken very seriously as it is a bi-partisan bill by the Senate Judiciary Committee leaders.