WASHINGTON DC (July 24, 2019) — Prepared floor remarks by Senator Charles "Chuck" Grassley on the EB-5 Program:
I want to talk about the new rule that the Department of Homeland Security published in the Federal Register today to finally bring some needed reforms to the EB-5 green card program.
As I mentioned in my remarks on this topic last week, this rule was first proposed in January 2017. Those of us who want to reform the EB-5 program have been waiting two-and-a-half years for this rule to become final, and we’ve been waiting much longer than that for some meaningful reforms to this fraud-laden program.
I think the President and his team deserve a lot of credit for pushing these reforms across the finish line and getting a big win for rural America.
As I have said on numerous occasions, Congress intended for the EB-5 program to help spur investment in rural and high unemployment areas when it was established in 1990.
Unfortunately, since that time, big-moneyed interests have been able to gerrymander EB-5 targeted-employment areas in a way that redirected investment away from our rural and economically-depressed communities and towards major development projects in Manhattan and other large cities.
Therefore, instead of providing much-needed investment for rural America as originally intended, EB-5 has become a source of cheap foreign capital for development projects in already-prosperous areas of the country. For the first time, this rule will help to change that.
Under the rule, states will no longer be allowed to game and gerrymander targeted employment areas. Instead, the Department of Homeland Security will make targeted employment-area designations directly based on revised requirements that will help to ensure rural and high-unemployment areas get more of the investment that they’ve been deprived of for far too long under this program.
Again, this is a major win for rural America. And I thank President Trump and his Administration for making this happen and looking out for the interests of my constituents in Iowa and other rural states.
This rule also addresses the minimum investment-threshold amounts that are required for EB-5 projects around the country. This is the first time the investment-thresholds have been adjusted since the program was created in 1990.
For projects that are outside of targeted employment areas, the threshold will be raised from $1 million to $1.8 million. For projects in targeted employment areas, the threshold will be raised from $500,000 to $900,000. The minimum investment amounts will automatically adjust for inflation every five years.
It’s ridiculous that our country’s major green-card program for investors has been operating with investment amounts that haven’t been adjusted a single time in 30 years. That makes no sense, and I’m glad the President and his team have taken necessary action to restore a little common sense to the EB-5 program.
There is more work to be done on the EB-5 program, but the President and his Administration deserve a lot of credit for finally implementing these first reforms that I and several other colleagues have championed for years.
I, more than most, understand the power and influence that the big-moneyed EB-5 interests have historically had in Washington, and how they have used that power and influence to consistently thwart any attempt to reform a program in such obvious need of it.
Their unrelenting efforts to stymie EB-5 reform over the years absolutely epitomize the swamp culture that so many voters rejected in the last presidential election. They are also representative of a culture in Washington that too often disregards the interests of the little guy in rural Iowa in favor of the interests of the rich and powerful.
I applaud the President and his team for standing up to them. I’m happy to say that, with the publication of this rule, the little guys in rural America finally got a win in the EB-5 program.
I now look forward to working with the President and my colleagues to build off of this win and bring further reform to the EB-5 program in the future.
