The United States Citizenship and Immigration Services (USCIS) recently published the 2020 fiscal year statistics for all their visa categories. The statistics detail how many applications the government department received in each quarter of the 2020 fiscal year and of those how many were processed. Comparing the 2020 I-526 petitions for the EB-5 immigrant investor category against the 2019 I-526 petitions will provide an understanding of how the program performed under the 2020 circumstances.
It has been heavily reported how the Trump policies along with Covid-19 affected immigration into the U.S. holistically, however very rarely has it been presented along with statistical evidence indicating the extent in which these changes had on all visa categories. On November 2019, the EB-5 immigrant investor program faced its most critical program adjustment since its enactment with the increment of the required capital investment from $500,000 to $900,000 under the EB-5 modernization rule. Additionally, the Muslim Travel ban prevented foreign nationals from selected Muslim majority countries from entering the U.S.
In the first quarter of the 2019 fiscal year 1,808 I-526 petitions were received, of all the I-526 petitions in the system 2,175 were approved. By the end of the first quarter USCIS had 13,508 petitions pending review in the system. In comparison with the 2020 fiscal year, 4,264 I-526 petitions were received, 383 were approved leaving 17,468 petitions pending review in the system. Evidently the first quarter of 2020 fiscal year had more than double the amount of petitions submitted in fiscal year 2019. As the USCIS fiscal year starts in October it can be assumed that the reason for the increased number of applicants is due to the rush of petitions submitted before the capital investment amount was increased in November 2019.
The above analysis can be supported by looking at the statistics provided for the following quarter, according to USCIS only 21 I-526 petitions were submitted in the second quarter of the 2020 fiscal year. Now some may argue that this was due to Covid-19 or the travel restrictions however, the EB-5 program was exempt from all the travel restrictions. Meaning that prospective investors could have still continued to apply for their I-526 petitions regardless of the travel restrictions, barring only those that were from the banned Muslim majority countries. This decrease in applications should thus be directly attributed to the increased capital investment. The increased capital investment has made this program almost unattainable for the majority of prospective applicants that fall under the upper middle class category. Those that use their life savings as capital for investment.
The positive benefit of the USCIS receiving low applicants in the 2020 fiscal year is that it gave the officials an opportunity to tackle the backlog of applications. Based on the data the officials continued to process a similar amount of applications per quarter as they have done in previous years. This would allow for the number of petitions pending review to stay at a low number while the officials deal with the ones currently in the system. By the end of the fourth quarter of the 2020 fiscal year USCIS had 15063 I-526 petitions awaiting review. This means that over 2000 petitions in the system received resolve whether approvals or denials. This is also indicative of the latest update from USCIS of almost all countries being current and only China Mainland and Vietnam remaining with backlogged applications.
Overall, the 2020 fiscal year data may reflect the lowest number of applications received under the EB-5 program as compared to previous years. While these figures may be daunting they are not a direct reflection of the importance of this program to both the U.S. and the people that want to participate in it. They are a reflection of how people are reacting to the current changes to the program and further can be seen as a call for congress to reform the program and make it more accessible again.
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