The new EB-5 regulations, now in effect, provide a real incentive for EB-5 investment in rural areas.
This is because there is a big difference between the “targeted employment area” (TEA) investment level and the non-TEA investment level. Rural areas qualify as TEAs. The TEA investment level is USD 900,000 while the non-TEA investment level is twice that at USD 1,800,000.
The rules for qualifying as a rural TEA are not as familiar to the EB-5 industry and our regulators, I have found. This is understandable given the dominance of high unemployment TEAs. I have seen both U.S. projects providing inadequate rural TEA evidence and Investor Program Office examiners requesting the wrong TEA evidence.
It’s critical to get rural qualification right because we can’t count on USCIS to provide actionable feedback. USCIS’s reported processing times for I-924s on which to submit exemplars, initial regional center designations, or other amendments is 62 to 115.5 months. That’s no typo: it’s 5 to 9.6 years. That makes I-526 petition processing times look lightening quick at 31.5 to 52 months. By the time USCIS comes back to advise a project or investors that an area may not actually be rural, the time for course-correction will have long passed.
I have been advising rural projects since 2010. I’m proud of the diversity rural projects have brought to the EB-5 market and of their role in spreading EB-5 capital across the United States. One of the few lights the EB-5 Modernization Regulations bring is a leg up for rural projects. Here’s hoping that light will shine on some fantastic rural EB-5 projects to come.
CAROLYN LEE PLLC EB-5
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