A little-noticed provision in the congressional bill overhauling the U.S. immigration system that President Donald Trump endorsed Wednesday would abolish a program that has brought billions of dollars into the United States — including hundreds of millions for Florida — from foreign immigrants who get visas and green cards in return for investments in job-creating projects.
Most of the extremely heated discussion of the plan has focused on its broadest features, including cutting the number of legal immigrants by half and de-emphasizing family reunification in favor of immigrants with particular job skills.
But a few paragraphs in the bill written in the opaque style of official Washington also eliminate the EB-5 visa program, which by some estimates has funneled more than $18 billion in overseas cash into U.S. business development since 2008.
“There’s a whole industry that will be eliminated with the stroke of a pen,” said Gerardo Menchaca, a San Antonio attorney who has helped channel EB-5 money into several South Florida development projects, including construction of Sonic drive-in restaurants in Miami Gardens and Lauderhill.
EB-5 money has helped finance everything from the huge downtown Miami station for the upcoming All Aboard Florida railroad line to SkyRise Miami, the thousand-foot skyscraper schedule to launch in 2020.
If the bill proposed by Sens. David Perdue, R-Ga., and Tom Cotton, R-Ark., and endorsed by Trump becomes law, though, the EB-5 program would be scuttled, their offices confirmed to the Miami Herald on Thursday.
The bill does include provisions to encourage immigrant investment in the United States. But it raises the minimum investment from $500,000 to $1.3 million and says the money can only be used in a business managed by the immigrant. That’s a marked difference from the EB-5 program, in which most investors put their money into a loan pool that funds major corporate development projects.
And even an investment that meets all those standards wouldn’t guarantee the prospective immigrant a green card. The bill would establish a system of assigning potential immigrant points for various things — job skills, age, English proficiency and others — and only those with a total of 30 would be eligible to live in the United States. An approved investment would be worth only 12 points.
The section of the bill abolishing the EB-5 was so cloudily written that many developers and immigration lawyers were still unaware of it on Thursday afternoon. Those who did know didn’t try to hide their dismay.
“This is going to dry up a huge pool of cheap money that’s created a lot of jobs for Americans over the past nine years,” said Menchaca, the attorney.
Menchaca noted that the investments are typically administered by so-called EB-5 regional centers, private institutions that pool and direct the money. “There’s about a thousand of these across the United States, which cost half a million dollars or more apiece to set up,” he said, pointing out that they will all have to close.
Other EB-5 supporters, however, said the bill was nothing to panic about — at least not yet. It still has to be passed by a Congress that’s deeply divided about immigration and has plenty of other prickly issues, from tax reform to a new budget, already on its plate.
“I’m officially not worried about this bill,” said Ronald Fieldstone, a Miami attorney who specializes in EB-5 investments. “I don’t think it’s going to pass, and I certainly don’t think it’s going to pass anytime soon.”
Follow Glenn Garvin on Twitter: @glenngarvin